SAB Biotherapeutics, Inc. (formerly Big Cypress Acquisition Corp.) — Form 10-Q
Reporting period: Quarter ended September 30, 2021. This filing reports the pre-combination blank-check company, not SAB Biotherapeutics’ operating results. The business combination closed on October 22, 2021, after quarter-end.
Financial results and position
| Metric | Three months ended September 30, 2021 | Nine months ended September 30, 2021 |
|---|---|---|
| Operating revenue | None | None |
| Operating costs | $335,552 | $704,011 |
| Operating loss | $335,552 | $704,011 |
| Net income (loss) | $(330,829) | $440,230 |
| Basic and diluted earnings (loss) per share | $(0.02) | $0.03 |
| Net cash used in operating activities | $(553,341) for the nine months |
- The nine-month net income chiefly reflected a $1,495,871 noncash gain from a decrease in warrant-liability fair value; the quarter recorded a smaller $1,794 gain on that measure.
- At September 30, cash outside the Trust Account was $667,873; Trust Account marketable securities were $116,158,244, including $8,244 of interest. Trust assets were primarily money market funds investing in U.S. Treasuries and were intended principally to fund the business combination.
- Total assets were $116,928,859; total liabilities were $10,072,188, including $5,529,312 of warrant liabilities and a $4,220,500 deferred underwriting fee. No debt was outstanding; the related-party promissory note had been repaid.
- Liquidity and operating margins are not representative of the post-merger biotechnology business: the predecessor had not commenced operations and had no operating revenue.
Changes, transaction, and unusual items
- The company restated prior-period presentation of redeemable common stock, classifying all 11.5 million public shares as temporary equity. The filing states the restatement did not change total assets, liabilities, or operating results; it changed equity classification and earnings-per-share presentation.
- On October 22, 2021, the merger closed. OLD SAB shares and preferred shares were exchanged using an agreed $300 million equity value and a $10.10 conversion rate. Up to 12 million earnout shares and shares underlying earnout RSUs were tied to conditions over the five-year earnout period.
- The filing reports 43,474,779 common shares issued and outstanding as of November 15, 2021, after the transaction; this is not the September 30 share count.
- No guidance or outlook for the combined operating company is provided in this pre-combination 10-Q. Management said COVID-19 could adversely affect the predecessor’s financial position, operations, or target search, but the specific impact was not determinable.
Risks, controls, and contingencies
- Management concluded disclosure controls were ineffective at September 30, 2021, due to a material weakness in internal control over financial reporting associated with prior errors and restatements. A remediation plan included enhanced review, documentation, and GAAP compliance procedures; management cautioned remediation was not assured.
- The $4,220,500 deferred underwriting fee was payable only upon completion of a business combination. Sponsor indemnification intended to protect Trust funds from certain third-party claims may be limited: the company had not verified the Sponsor’s ability to pay.
- The filing identifies potential need for additional financing if transaction costs or redemptions exceeded available funds. It reports no off-balance-sheet arrangements and no legal proceedings.
Key facts for investors to verify
- Review the post-combination filings for SAB’s operating-company revenue, cash burn, liquidity, financing proceeds, and outlook; this 10-Q does not provide those results.
- Confirm the merger’s final capitalization, share count, redemptions, and any earnout conditions or dilution.
- Track remediation of the disclosed material weakness and whether subsequent filings report effective controls.
- Assess the availability and restrictions on transaction cash, as the Trust Account balance was not equivalent to unrestricted cash available at September 30.