Business Context and Reporting Period
This Form 8-K reports the consummation of the Initial Public Offering (IPO) by Mudrick Capital Acquisition Corporation (the "Company"), a Special Purpose Acquisition Company (SPAC). The report date is February 13, 2018, covering events occurring between February 7, 2018, and February 12, 2018. The Company is incorporated in Delaware and is classified as an emerging growth company.
Key Financial Metrics
- IPO Gross Proceeds: $200,000,000 from the sale of 20,000,000 Units at $10.00 per Unit.
- Private Placement Proceeds: $7,500,000 from the sale of 7,500,000 Private Placement Warrants at $1.00 per warrant.
- Total Funds in Trust: $202,000,000 deposited in a U.S.-based trust account at J.P. Morgan Chase Bank, N.A.
- Trust Composition: Includes $194,500,000 from IPO proceeds (incorporating $7,000,000 of deferred underwriting discount) and $7,500,000 from private placement proceeds.
- Over-Allotment Option: Underwriters granted a 45-day option to purchase up to 3,000,000 additional Units.
Material Changes
The filing represents the Company's transition from a private entity to a publicly traded SPAC. Key material changes include:
- Capital Structure: Issuance of 20,000,000 Units, each consisting of one share of Class A common stock and one warrant exercisable at $11.50 per share.
- Corporate Governance: Filing of an Amended and Restated Certificate of Incorporation on February 8, 2018.
- Liquidity Position: Establishment of a trust account holding $202,000,000, which is restricted until the completion of an initial business combination or a redemption event.
Outlook, Risks, and Contingencies
- Business Combination Deadline: The Company must complete an initial business combination within 24 months from the closing of the IPO (by February 2020).
- Redemption Rights: Public shareholders may redeem their shares if the Company fails to complete a business combination within the 24-month period or if shareholders vote to amend the certificate of incorporation regarding redemption obligations.
- Warrant Restrictions: Private Placement Warrants held by the Sponsor and Cantor Fitzgerald are subject to transfer restrictions until 30 days after the initial business combination and are non-redeemable while held by these parties.
- Use of Funds: Funds in the trust account are generally not accessible for operations except for interest earnings used to pay taxes.
Investor Verification Checklist
- Verify the exact terms of the 45-day over-allotment option and potential dilution if exercised.
- Confirm the specific conditions under which the $202,000,000 trust funds may be released prior to a business combination.
- Review the Amended and Restated Certificate of Incorporation (Exhibit 3.1) for specific redemption thresholds and voting rights.
- Assess the Sponsor's commitment to purchase additional Private Placement Warrants if the over-allotment is exercised.
- Note that the filing text does not provide operating revenue, profit, or cash flow metrics as the Company is a pre-operational SPAC.