References to the "Company," "our," "us" or "we" refer toBlack Mountain Acquisition Corp. , a blank check company incorporated onFebruary 10, 2021 as aDelaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this Quarterly Report on Form 10-Q as our "initial business combination." References to our "Sponsor" refer toBlack Mountain Sponsor LLC , aDelaware limited liability company. References to the "SEC" are to theU.S. Securities and Exchange Commission . References to our "Public Offering" refers to our initial public offering, which closed onOctober 18, 2021 (the " Closing Date "). References to "public shares" are to shares of our Class A common stock sold as part of the units in our Public Offering. References to "public stockholders" are to the holders of our public shares. The following discussion should be read in conjunction with our unaudited condensed financial statements and related notes thereto included elsewhere in this report. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Some statements contained in this Quarterly Report on Form 10-Q are forward-looking statements in nature. Our forward-looking statements include, but are not limited to, statements regarding our or our management team's expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the following risks, uncertainties and other factors: • our ability to complete our initial business combination, particularly in light of disruption that may result from limitations imposed by the COVID-19 outbreak and other events (such as terrorist attacks, natural disasters or other significant outbreaks of infectious diseases); • our being a company with no operating history and no revenues; • our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; • our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense reimbursements; • our potential ability to obtain additional financing to complete our initial business combination; • our pool of prospective target businesses; • our ability to select an appropriate target business or businesses; • our expectations around the performance of the prospective target business or businesses; • the ability of our officers and directors to generate a number of potential acquisition opportunities; • our public securities' potential liquidity and trading; 19
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Table of Contents • the lack of a market for our securities; • the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; • the trust account not being subject to claims of third parties; • our financial performance; or • the other risks and uncertainties discussed in "Risk Factors" and elsewhere in this Quarterly Report on Form10-Q. The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in the section entitled "Risk Factors" in our Annual Report on Form 10-K filed with theSEC onApril 14, 2022 . Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Overview
We are a blank check company incorporated on
InFebruary 2021 , we issued an aggregate of 5,750,000 shares of our Class B common stock (the "Founder Shares") to our Sponsor in exchange for a capital contribution of$25,000 , a purchase price of approximately$0.004 per share. The number of Founder Shares issued was determined based on the expectation that such Founder Shares would represent 20% of the outstanding shares upon completion of our initial public offering (our "Public Offering"). The per share purchase price of the Founder Shares was determined by dividing the amount of cash contributed to the Company by the aggregate number of Founder Shares issued. InOctober 2021 , in connection with our Public Offering, our Sponsor forfeited a total of 90,000 Founder Shares to us for no consideration, and we then issued 30,000 Founder Shares to each of our three independent directors at their original purchase price. Also inOctober 2021 , in connection with our Public Offering, we effected a stock dividend of 1,150,000 Founder Shares on the Founder Shares, which resulted in our Sponsor owning 6,810,000 Founder Shares. Such stock dividend has been accounted for retroactively to all periods. The holders of our Founder Shares prior to our Public Offering are referred to in this Quarterly Report on Form 10-Q as our "initial stockholders." On the Closing Date, we consummated our Public Offering of 24,000,000 units (the " Units ") and, onOctober 22, 2021 , the underwriters in our Public Offering purchased an 3,600,000 additional Units upon the full exercise of their over-allotment option, resulting in the sale of 27,600,000 Units in the aggregate. The Units were sold at a price of$10.00 per unit, generating gross proceeds to us of$276,000,000 . Each Unit consists of one share of our Class A common stock and three quarters of one warrant. Each whole warrant (a " public warrant ") entitles the holder thereof to purchase one whole share of our Class A common stock at a price of$11.50 per share, subject to adjustment, and only whole warrants are exercisable. The warrants will become exercisable on the 30th day after the completion of our initial business combination and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the Closing Date, simultaneously with the consummation of our Public Offering, we completed a private placement of 11,600,000 private placement warrants (the " Private Placement Warrants ") at a purchase price of$1.00 per warrant to our Sponsor, generating gross proceeds to us of approximately$11,600,000 and, onOctober 22, 2021 , simultaneously with the consummation of the over-allotment option, we completed a private placement of 1,440,000 20
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additional Private Placement Warrants at a purchase price of
Approximately$281,520,000 of the net proceeds from our Public Offering and the Private Placement has been deposited in a trust account established for the benefit of our public stockholders (the " Trust Account ").
We received gross proceeds from our Public Offering and the sale of the Private
Placement Warrants of
The Founder Shares that we issued prior to the Closing Date will automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in our Public Offering and related to the closing of the initial business combination, the ratio at which the shares of our Class B common stock will convert into shares of our Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of our Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of our Class A common stock issuable upon conversion of all issued and outstanding shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of our Public Offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the initial business combination (after giving effect to any redemptions of shares of our Class A common stock by public stockholders and excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination and any private placement warrants issued to our Sponsor, any affiliate of our Sponsor or any of our officers or directors upon conversion of any working capital loans). OnNovember 9, 2021 , we announced that, commencingNovember 12, 2021 , holders of the Units sold in our Public Offering may elect to separately trade the shares of Class A common stock and public warrants included in the Units. The shares of Class A common stock and public warrants that are separated will trade on theNew York Stock Exchange (" NYSE ") under the symbols "BMAC" and "BMAC WS," respectively. Those Units not separated will continue to trade on the NYSE under the symbol "BMAC.U".
Results of Operations
We have neither engaged in any operations nor generated any revenues to date.
Our only activities from
For the three months ended
For the six months ended
For the three months ended
For the six months ended
Liquidity, Capital Resources and Going Concern
As of
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Our liquidity needs up to
In
In order to finance transaction costs in connection with a Business Combination,
our Sponsor or an affiliate of the Sponsor or certain of our officers and
directors may, but are not obligated to, provide Working Capital Loans. As of
In connection with the Company's assessment of going concern considerations in accordance with FASB Accounting Standards Update ("ASU") 2014-15, "Disclosures of Uncertainties about an Entity's Ability to Continue as a Going Concern," management has determined that the Company has and will continue to incur significant costs in pursuit of its acquisition plans which raises substantial doubt about the Company's ability to continue as a going concern. Moreover, we may need to obtain additional financing either to complete our initial Business Combination or because we become obligated to redeem a significant number of our Public Shares upon consummation of our initial Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial Business Combination. If we are unable to complete our initial Business Combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the Trust Account. In addition, following our initial Business Combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.
In connection with the Company's assessment of going concern considerations in accordance with FASB ASC 205- 40, "Presentation of Financial Statements-Going Concern", management has determined that if the Company is unable to complete a Business Combination byApril 19, 2023 (the "Combination Period"), then the Company will cease all operations except for the purpose of liquidating. The date for mandatory liquidation and subsequent dissolution as well as the Company's working capital deficit raise substantial doubt about the Company's ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after the Combination Period. The Company intends to complete a Business Combination before the mandatory liquidation date. Related Party Transactions Founder Shares
On
The holders of the Founder Shares agreed, subject to limited exceptions, not to transfer, assign or sell any of their Founder Shares until the earlier to occur of: (i) 180 days after the completion of the Initial Business Combination or (ii) subsequent to the Initial Business Combination, the date on which the Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Company's stockholders having the right to exchange their shares of common stock for cash, securities or other property.
Registration Rights
The holders of the Founder Shares, Private Placement Warrants and warrants that
may be issued upon conversion of working capital loans (and any shares of
Class A common stock issuable upon the exercise of the private placement
warrants or warrants that may be issued upon conversion of working capital loans
and upon conversion of the Founder Shares) will be entitled to registration
rights pursuant to a registration rights agreement, requiring us to register
such securities for resale (in the case of the Founder Shares, only after
conversion to our Class A common stock). The holders of at least
Related Party Working Capital Loan
In addition, in order to finance transaction costs in connection with an Initial
Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of
the Company's officers and directors may, but are not obligated to, loan the
Company funds on anon-interest bearing basis as may be required ("
Working Capital Loans
"). If the Company completes an Initial Business Combination, the Company will
repay the Working Capital Loans out of the proceeds of the Trust Account
released to the Company. Otherwise, the Working Capital Loans would be repaid
only out of funds held outside the Trust Account. In the event that the Initial
Business Combination does not close, the Company may use a portion of proceeds
held outside the Trust Account to repay the Working Capital Loans but no
proceeds held in the Trust Account would be used to repay the Working Capital
Loans. Except for the foregoing, the terms of such Working Capital Loans, if
any, have not been determined and no written agreements exist with respect to
such loans. The Working Capital Loans would either be repaid upon consummation
of the Initial Business Combination or, at the lender's discretion, up to
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Related Party Promissory Note
OnFebruary 10, 2021 , the Sponsor agreed to loan the Company an aggregate of up to$250,000 to cover expenses related to the Proposed Public Offering pursuant to an unsecured promissory note (the " Note "). This Note was non-interest bearing and payable upon the earlier of (i) the date that is 180 days following the date of the Note and (ii) the closing date of the IPO. Prior to the consummation of the IPO, the Company borrowed$195,000 under the Note. The Note was fully repaid onOctober 20, 2021 from the proceeds of the IPO.
Administrative Support Agreement
Beginning on
Critical Accounting Policies and Estimates
The preparation of unaudited condensed consolidated financial statements and
related disclosures in conformity with accounting principles generally accepted
in
Class A Common Stock Subject to Possible Redemption
As a result of the right of stockholders to redeem their Public Shares in connection with a tender offer for shares or an Initial Business Combination, all such Public Shares are recorded at redemption amount and classified as temporary equity upon the completion of the IPO, in accordance with FASB ASC 480, "Distinguishing Liabilities from Equity."
Offering Costs associated with the Initial Public Offering
The Company complies with the requirements of the ASC
340-10-S99-1.
Offering costs consisted of legal, accounting, underwriting fees and other costs
incurred through the Initial Public Offering that were directly related to the
Initial Public Offering. The Company incurred offering costs amounting to
Net Income (Loss) per Share
Net income (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. We apply the two-class method in calculating earnings per share. Adjustment associated with the redeemable shares of Class A common stock is excluded from earnings per share as the redemption value approximates fair value.
Off-Balance
Sheet Arrangements
As ofJune 30, 2022 , we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K.
Contractual Obligations
As of
The underwriters of the Initial Public Offering were entitled to underwriting
discounts and commissions of 5.5%, of which 2% (
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JOBS Act
The Jumpstart Our Business Startups Act of 2012 (the " JOBS Act ") contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an "emerging growth company" and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our unaudited condensed financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an "emerging growth company," we choose to rely on such exemptions we may not be required to, among other things, (a) provide an auditor's attestation report on our system of internal controls over financial reporting pursuant to Section 404 of the JOBS Act, (b) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (c) comply with any requirement that may be adopted by the Public Company Accounting and Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the unaudited condensed financial statements (auditor discussion and analysis) and (d) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of our Chief Executive Officer's compensation to median employee compensation. These exemptions will apply for a period of five years following the closing of the Initial Public Offering or until we are no longer an "emerging growth company," whichever is earlier.
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