Business context and reporting period
Important identity distinction: This June 30, 2022 Form 10-Q is filed by AMCI Acquisition Corp. II, a blank-check company and shell—not by an operating company named LanzaTech Global, Inc. AMCI had not yet completed its proposed combination with LanzaTech NZ, Inc.; the filing’s financial statements are AMCI’s.
The filing covers the quarter and six months ended June 30, 2022. AMCI reported no operating activity or revenue; its activity related to formation, its August 2021 IPO, and pursuing a business combination.
Financial results and position
- Revenue: None. AMCI said it would not generate operating revenue before completing a business combination.
- Quarterly results: Net income was $3.35 million for Q2 2022, versus a $443 loss for Q2 2021. Q2 2022 included a $3.41 million gain from changes in warrant fair value and $227,000 of trust investment income, offset by a $283,000 operating loss.
- Six-month results: Net loss was $188,000, compared with a $1,569 loss from inception through June 30, 2021 (not a comparable six-month period). The 2022 loss included a $3.07 million operating loss, partly offset by a $2.64 million warrant fair-value gain and $239,000 of trust investment income.
- Cash flow: Cash used in operations was $345,000 for the six months. Cash at June 30 was $7,802; trust investments were $150.24 million.
- Liquidity and liabilities: Current liabilities were $3.33 million and working capital deficit was approximately $2.9 million, excluding approximately $99,000 of tax obligations potentially payable from trust investment income. Total liabilities were $11.55 million, including $5.25 million of deferred underwriting commissions and $2.97 million of warrant liabilities. No working-capital loan borrowings were outstanding; a sponsor facility of up to $1.5 million was available but not committed funding.
- Debt and margins: The filing does not report operating-company debt or meaningful revenue margins. The redeemable Class A shares, carried at $150 million, are classified as temporary equity, not conventional debt.
Material changes and transaction
On March 8, 2022, AMCI agreed to combine with LanzaTech NZ, Inc. The proposed consideration values LanzaTech’s equity at $1.817 billion, with shares valued at $10 each. A proposed private investment in public equity (PIPE) would issue 12.5 million shares for $125 million, subject to closing. Closing conditions include stockholder approvals, regulatory and registration requirements, Nasdaq listing, at least $5.0 million of net tangible assets, and at least $250 million of cash at closing after redemptions and transaction expenses.
Compared with December 31, 2021, operating cash fell from $343,399 to $7,802; current liabilities rose from $751,356 to $3.33 million, principally reflecting higher accrued expenses and amounts due to related parties. Warrant liabilities fell from $5.61 million to $2.97 million, producing a non-cash fair-value gain.
Outlook, risks and unusual items
- AMCI’s deadline to complete a business combination was August 6, 2023. Management said failure to complete one by then would require liquidation and dissolution and disclosed substantial doubt about the company’s ability to continue as a going concern. Management expected to obtain additional capital, but said that was uncertain.
- The trust account is generally reserved for a business combination or redemptions; public shareholders may redeem shares in connection with a completed transaction. Third-party claims could reduce trust assets, and the filing said the sponsor’s ability to meet its indemnity obligations was not assured.
- Management said COVID-19 could adversely affect AMCI’s financial position or its search for a target, but the impact could not be determined. No adjustment for this uncertainty was included in the financial statements.
- The filing reports no legal proceedings, no off-balance-sheet arrangements, and no material changes to previously disclosed risk factors. Management concluded disclosure controls were effective and said a previously identified material weakness had been remediated during the quarter.
- Results are materially affected by non-cash warrant remeasurement; quarterly profit should not be read as operating performance. No operating-company guidance or LanzaTech financial results are provided here.
Key facts investors should verify
- Confirm the filing issuer and period: AMCI Acquisition Corp. II, quarter ended June 30, 2022—not LanzaTech Global’s operating results.
- Check the subsequent status and final terms of the proposed LanzaTech transaction, including approvals, closing conditions, PIPE funding, redemptions, and cash available at closing.
- Assess AMCI’s very limited cash outside the trust, working-capital deficit, going-concern warning, and August 6, 2023 transaction deadline.
- Distinguish recurring operating costs from trust income and non-cash warrant fair-value gains when evaluating reported earnings.