Part I Business This blank check company, formed in May 2021, aims to acquire a business in the next-generation mobility sector within 15 months of its IPO - The company is a blank check company formed in May 2021 to effect a merger, asset acquisition, or similar business combination, and has not yet selected a specific target24 - The company intends to focus its search for a target business in the next-generation mobility sector, including areas like digital mobility platforms, sensor technologies, autonomous computing, next-generation aviation, and sustainable infrastructure2427 - The company must complete its initial business combination within 15 months from the closing of its IPO, or it will cease operations, redeem public shares, and liquidate67107 - The target business must have a collective fair market value equal to at least 80% of the balance in the trust account at the time of executing a definitive agreement78 - As of March 15, 2022, the company has approximately $306,000,000 held in its trust account available for a business combination63 Risk Factors The company faces significant risks including its blank check nature, intense SPAC competition, management conflicts of interest, potential shareholder dilution, and external market factors - The company is a blank check entity with no operating history or revenue, providing no basis for investors to evaluate its ability to achieve its business objectives135 - There is increased competition from a large number of other SPACs, which may make attractive targets scarcer and potentially increase the cost of an initial business combination225226 - Officers and directors have conflicts of interest as they allocate time to other businesses, including another SPAC (ACA I), and have financial incentives to complete a business combination that may not be in the best interest of public stockholders206207212 - The nominal purchase price of approximately $0.0035 per share paid by the sponsor for founder shares may result in significant dilution to public shares upon a business combination265 - The search for a target business may be adversely affected by the COVID-19 outbreak, geopolitical conflicts, and unfavorable debt and equity market conditions175177 Unresolved Staff Comments The company has no unresolved staff comments from the SEC - There are no unresolved staff comments289 Properties The company does not own any properties, with its executive office provided at no cost by a sponsor affiliate - The company does not own any real estate or other physical properties, and its principal executive office at 6 St Johns Lane, Floor 5, New York, NY 10013 is provided by an affiliate of the sponsor at no cost290 Legal Proceedings There is no pending litigation against the company or its officers and directors - To the knowledge of management, there is no litigation currently pending against the company or its officers and directors291 Mine Safety Disclosures This section is not applicable to the company - Not applicable292 Part II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's securities trade on Nasdaq, with its January 2022 IPO raising $300 million and placing $306 million into a trust account, and it does not intend to pay dividends - The company's units, common stock, and warrants trade on the Nasdaq Global Market under the symbols ACABU, ACAB, and ACABW, respectively, with trading commencing in January and March 2022295 - The company consummated its IPO of 30,000,000 units at $10.00 per unit on January 13, 2022, generating gross proceeds of $300,000,000300 - Simultaneously with the IPO, the sponsor purchased 13,850,000 private placement warrants at $1.00 each, generating gross proceeds of $13,850,000300 - Following the IPO and private placement, a total of $306,000,000 ($10.20 per unit) was placed in a trust account302 - The company has not paid any cash dividends and does not intend to in the foreseeable future298 Management's Discussion and Analysis of Financial Condition and Results of Operations As a blank check company, it reported a $1,793 net loss from inception to December 31, 2021, with post-IPO liquidity of $1.8 million cash and $1.75 million in potential sponsor loans - For the period from May 20, 2021 (inception) to December 31, 2021, the company had a net loss of $1,793, consisting of operating and formation costs311 - As of December 31, 2021, prior to the IPO, the company had no cash and its liquidity needs were met through $25,000 from the sale of Founder Shares and loans from the sponsor312 - Post-IPO, the company has approximately $1,819,051 of cash held outside the trust account for working capital purposes471481 - The sponsor has committed to provide up to $1,750,000 in loans to fund working capital deficiencies or finance transaction costs, of which up to $1,500,000 may be convertible into warrants319320 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of December 31, 2021, with no material changes to internal controls - Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures and concluded they were effective as of December 31, 2021334 - There were no changes in internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls338 Part III Directors, Executive Officers and Corporate Governance The company's seven-member Board of Directors, including key executives, is divided into three staggered classes and operates with independent audit, compensation, and governance committees Directors and Executive Officers | Name | Title | | :--- | :--- | | Shahraab Ahmad | Chief Executive Officer and Chairman of the Board of Directors | | Anthony D. Eisenberg | Chief Strategy Officer and Director | | Jason Chryssicas | Chief Financial Officer and Director | | Burt Jordan | President and Director | - The Board of Directors is divided into three staggered classes (Class I, II, and III), with each class serving a three-year term354355 - The Board has three standing committees: Audit, Compensation, and Nominating and Corporate Governance, and each committee is composed solely of independent directors358 - Dominick J. Schiano serves as the chair of the audit committee and qualifies as an audit committee financial expert360 Executive Compensation No cash compensation has been paid to executive officers or directors, who are reimbursed for expenses, with future compensation to be determined post-business combination - No cash compensation has been paid to any officers or directors for services rendered to the company376 - Individuals will be reimbursed for out-of-pocket expenses incurred in connection with activities on the company's behalf, such as identifying potential target businesses376 - Compensation for management after the initial business combination will be determined by the directors of the post-combination company377 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The sponsor and initial stockholders collectively own approximately 20% of common stock, subject to a one-year lock-up, granting them significant voting influence Beneficial Ownership | Name of Beneficial Owner | Series B Common Stock Beneficially Owned | % of Total Voting Power | | :--- | :--- | :--- | | Atlantic Coastal Acquisition Management II LLC (Sponsor) | 7,200,000 | 19.2% | | All executive officers and directors as a group (9 persons) | 7,450,000 | 19.9% | - The initial stockholders beneficially own approximately 20% of the issued and outstanding shares of common stock385 - Founder shares are subject to a lock-up agreement, generally restricting transfer until one year after the consummation of the initial business combination, with certain provisions for early release389 Certain Relationships and Related Transactions, and Director Independence Related party transactions include the sponsor's $25,000 founder share purchase, a repaid promissory note, and a $1.75 million working capital loan commitment, alongside noted management conflicts and independent board majority - The sponsor purchased founder shares for an aggregate price of $25,000393 - The sponsor provided a promissory note of up to $250,000 to cover initial costs, which was fully repaid on February 22, 2022395 - The sponsor has committed to provide up to $1,750,000 in working capital loans to finance transaction costs, of which up to $1,500,000 may be convertible into warrants396 - Potential conflicts of interest are noted, as officers and directors have fiduciary duties to other entities, including Atlantic Coastal Acquisition Corp. (ACA I)411413 - A majority of the board members are independent directors as defined by Nasdaq rules428 Principal Accountant Fees and Services The company paid $41,200 in audit fees to Marcum LLP for the period from inception to December 31, 2021, with no other fees for audit-related, tax, or other services Accountant Fees | Fee Category | Amount (for period from May 20, 2021 to Dec 31, 2021) | | :--- | :--- | | Audit Fees | $41,200 | | Audit-Related Fees | $0 | | Tax Fees | $0 | | All Other Fees | $0 | Part IV Exhibits, Financial Statement Schedules This section indexes all exhibits filed with the 10-K, including corporate governance documents, securities agreements, and financial statement references - This section provides an index of all exhibits filed with the 10-K, including the Amended and Restated Certificate of Incorporation, Public Warrant Agreement, and Registration Rights Agreement439443446 Financial Statements Audited Financial Statements (as of December 31, 2021) The audited financial statements for May 20 to December 31, 2021, show $361,372 in total assets and a $1,793 net loss, with subsequent events including a $306 million trust account placement post-IPO Balance Sheet as of December 31, 2021 | Category | Amount ($) | | :--- | :--- | | Assets | | | Deferred offering costs | 361,372 | | Total Assets | 361,372 | | Liabilities & Stockholder's Equity | | | Accrued expenses | 1,793 | | Accrued offering costs | 236,095 | | Promissory note - related party | 100,277 | | Total Liabilities | 338,165 | | Total Stockholder's Equity | 23,207 | Statement of Operations (May 20, 2021 - Dec 31, 2021) | Category | Amount ($) | | :--- | :--- | | Formation and operating costs | 1,793 | | Net loss | (1,793) | - Subsequent to the balance sheet date, the company consummated its IPO on January 19, 2022, generating gross proceeds of $300 million469 - Following the IPO, $306 million from the net proceeds of the IPO and the sale of private placement warrants was placed in a trust account472
Atlantic Coastal Acquisition Corp. II(ACABU) - 2021 Q4 - Annual Report