Business context and reporting period
This is AMCI Acquisition Corp. II’s unaudited Form 10-Q for the quarter ended March 31, 2022, filed May 16, 2022. Although the request identifies Lanzatech Global, Inc., the filing is by AMCI, a pre-combination SPAC; it does not report LanzaTech’s operating results. AMCI had not begun operations or generated revenue.
On March 8, 2022, AMCI agreed to combine with LanzaTech NZ, Inc. The proposed transaction contemplated $1.817 billion of equity consideration, valued at $10 per New LanzaTech share, plus a PIPE subscription for 12.5 million shares at $10 each. Closing remained subject to approvals and other conditions; the filing does not assume the transaction closes.
Financial results and position
| Metric | Q1 2022 / March 31, 2022 | Comparable period / December 31, 2021 |
|---|---|---|
| Revenue | None; no operating revenue | None; prior comparison is inception through March 31, 2021 |
| Net loss | $3.543 million | $1,126 for inception through March 31, 2021 |
| Operating loss | $2.785 million | $1,126 for inception through March 31, 2021 |
| Trust investments | $150.010 million | $150.006 million |
| Operating cash | $8,315 | $343,399 |
| Working capital | Deficit of approximately $2.8 million | Not clearly stated for comparison |
| Total liabilities | $14.775 million | $11.611 million |
| Warrant liabilities | $6.380 million | $5.610 million |
Q1 expenses included $2.652 million of general and administrative costs, $30,000 of related-party administrative fees, $53,583 of capital base tax and $49,365 of franchise tax. A $770,000 loss from the change in warrant fair value was partly offset by $12,550 of trust investment income. Basic and diluted loss per share was $0.19.
Net cash used in operating activities was $344,084; $9,000 of trust investment income was released, resulting in a $335,084 net decrease in cash. AMCI reported no borrowings under its working-capital loans at quarter-end and no outstanding off-balance-sheet arrangements. Its $150 million trust balance is distinct from the limited cash available for operating and transaction costs.
Material changes, outlook and risks
- Net loss increased substantially from the very small inception-period loss in early 2021; the periods are not directly comparable. Accrued expenses increased to $2.556 million from $229,733 at year-end, while operating cash fell to $8,315.
- Management concluded it would not be able to meet obligations as they come due within one year after the financial statements’ issuance and said the liquidity condition raises substantial doubt about AMCI’s ability to continue as a going concern. A sponsor working-capital loan of up to $1.5 million was available, but was not obligated to be funded and had no balance outstanding at quarter-end.
- The merger requires, among other conditions, stockholder approvals, an effective registration statement, Nasdaq listing, at least $5,000,001 of net tangible assets and at least $250 million of cash at closing after redemptions, PIPE proceeds and transaction expenses. Public-share redemptions could affect closing liquidity.
- AMCI’s business-combination deadline was August 6, 2023. Failure to complete a combination by then would require redemption of public shares and liquidation, subject to applicable requirements.
- Management said COVID-19 could adversely affect the company’s financial position or search for a target, but the effect was not determinable. The filing also notes that trust assets may be exposed to creditor claims and that the sponsor’s ability to meet its indemnification obligations is not assured.
- Disclosure controls were deemed ineffective because of a material weakness in accounting for complex financial instruments. The weakness had resulted in a restatement of the August 6, 2021 balance sheet; management described additional analyses and ongoing remediation efforts.
- The company reported no legal proceedings and no material changes to the risk factors in its prior Form 10-K.
Key facts for investors to verify
- Confirm the filing entity and reporting scope: this 10-Q covers AMCI, not LanzaTech’s standalone business or financial performance.
- Review the merger agreement, PIPE subscriptions, redemption levels and closing cash/net-tangible-asset conditions; the transaction was proposed, not completed in this filing.
- Assess AMCI’s very low operating cash, working-capital deficit, going-concern disclosure and whether sponsor financing was ultimately provided.
- Track remediation of the material weakness and any subsequent changes in financial reporting controls.
- Review the trust-account protections, creditor claims, warrant-liability valuation and the SPAC deadline and liquidation terms.