Lanzatech Global, Inc. quarterly report, Q2 FY2021

Full document

Filing identity and reporting period

Important identity mismatch: The supplied filing is AMCI Acquisition Corp. II’s Form 10-Q for the quarter ended June 30, 2021, not a LanzaTech Global, Inc. filing. AMCI was a blank-check company (SPAC) formed to pursue a business combination; it had not selected a target and reported no operating activity or revenue through June 30, 2021.

Financial results and position

  • Revenue: None through June 30, 2021. The company expected to generate operating revenue, if any, only after a business combination.
  • Net loss: $443 for the three months ended June 30, 2021; $1,569 from inception on January 28 through June 30, 2021. Losses reflected general and administrative expenses.
  • Cash flow: From inception through June 30, operating cash use was $569 and financing cash inflow was $1,000, leaving ending cash of $431.
  • Balance sheet: Cash was $431 and deferred offering costs were $300,887. Current liabilities totaled $277,887, comprising $162,981 of accrued expenses and a $114,906 related-party note. Stockholders’ equity was $23,431.
  • Liquidity: Management reported a working-capital deficit of $277,455 and said it expected available working capital and potential sponsor or affiliate borrowing to be sufficient through the earlier of a business combination or one year from the filing. The approximately $115,000 sponsor note was repaid at the IPO closing.
  • Margins and debt: Not meaningful for this pre-operating SPAC. No interest-bearing third-party debt or Working Capital Loans were reported at June 30; the related-party note was outstanding at period-end.

Changes and subsequent developments

There is no prior-year comparable operating period because AMCI was formed in January 2021. The filing reports a $443 second-quarter loss compared with a $1,126 loss for the first quarter, and a $1,569 cumulative loss from inception through June 30.

After quarter-end, AMCI completed an IPO of 15,000,000 units at $10 per unit, generating $150 million of gross proceeds, and sold 3,500,000 private placement warrants to its sponsor for $3.5 million. The filing says $150 million was placed in the trust account. IPO-related costs were approximately $7.3 million, including $5.25 million of deferred underwriting commissions payable upon a business combination. The underwriters also had a 45-day option to purchase up to 2,250,000 additional units.

Outlook, risks, and notable terms

  • AMCI had no target and had not begun substantive discussions with a prospective target as of June 30. It had 24 months from the IPO closing to complete a business combination or redeem public shares and liquidate.
  • Public shareholders generally could redeem shares in connection with a business combination. The transaction would be subject to trust-account, voting, and other conditions described in the filing.
  • Management said COVID-19 could adversely affect the company’s financial position, results, or target search, but the impact was not determinable; the financial statements included no related adjustments.
  • The sponsor’s trust-account indemnity may not fully protect public shareholders: AMCI had not verified the sponsor’s ability to pay, and believed the sponsor’s assets consisted only of AMCI securities.
  • Following the IPO, AMCI agreed to pay its sponsor $10,000 per month for administrative services. Founder shares were subject to forfeiture depending on exercise of the over-allotment option and could convert into Class A shares in connection with a business combination.
  • Management concluded disclosure controls were effective as of June 30, 2021, and reported no material change in internal control over financial reporting during the quarter. The filing reported no legal proceedings or off-balance-sheet arrangements.

Most important facts to verify

  1. Confirm the intended issuer: this document identifies AMCI Acquisition Corp. II, not LanzaTech Global, Inc.
  2. Verify the IPO closing date and related transaction details: the notes state the IPO closed August 6, 2021, while another section describes it as consummated August 3, the registration-statement effective date.
  3. Review the trust-account balance, redemption terms, and the 24-month business-combination deadline against later filings.
  4. Assess whether sponsor or affiliate funding would be available if needed, and the practical value of the sponsor’s indemnity.
  5. Track subsequent target announcements, redemptions, founder-share dilution, and payment of deferred underwriting commissions.