Mountain Lake Acquisition Corp-A(MLAC) - 2024 Q4 - Annual Report

Part I Business Mountain Lake Acquisition Corp. is a Cayman Islands blank check company formed to acquire a growth-poised business within 18 months or liquidate - The company is a blank check company, or Special Purpose Acquisition Company (SPAC), incorporated on June 14, 2024, for the purpose of effecting a business combination[19] Initial Public Offering (IPO) and Trust Account Details | Metric | Value | | :--- | :--- | | IPO Consummation Date | December 16, 2024 | | Units Offered | 23,000,000 (including 2,000,000 over-allotment units) | | Price per Unit | $10.00 | | Gross Proceeds from IPO | $230,000,000 | | Private Units Sale | 805,000 units at $10.00 each | | Gross Proceeds from Private Sale | $8,050,000 | | Total Amount in Trust Account | $231,150,000 | | Initial Redemption Value per Share | ~$10.05 | - The company has 18 months from the closing of its IPO to complete an initial business combination, otherwise it will redeem 100% of public shares and liquidate[56][57] - The business combination target must have a fair market value of at least 80% of the assets held in the trust account[58] - The management team, led by CEO Paul Grinberg and CFO Douglas Horlick, possesses extensive experience in M&A, capital raising, and public company oversight, a key competitive strength[30][37] Risk Factors The company faces significant risks as a blank check company, including inability to complete a business combination, dilution, regulatory changes, and management conflicts - Risks Related to Business Combination: The company may not complete an initial business combination within the required 18-month period, which would result in liquidation and the expiration of public rights[155][159] - Financial & Dilution Risks: The ability of public shareholders to redeem shares may make the company's financial condition unattractive to targets, and the nominal price paid by the sponsor for founder shares ($0.003 per share) will result in significant dilution to public shareholders upon a business combination[149][226] - Regulatory & Compliance Risks: The company could be deemed an investment company under the Investment Company Act, imposing burdensome requirements and potentially forcing liquidation, while changes in SEC regulations for SPACs could adversely affect transaction completion[183][190] - Management & Conflict of Interest Risks: Officers and directors have other business obligations, creating conflicts of interest in time allocation, and their financial incentive to complete any deal before the deadline may not align with public shareholders' best interests[254][264][273] - Market & External Risks: The search for a target may be adversely affected by geopolitical unrest (e.g., conflicts in Ukraine and Gaza), pandemics, and market volatility, impacting the ability to raise necessary financing[156][157] Unresolved Staff Comments The company reports no unresolved staff comments from the SEC - There are no unresolved staff comments[308] Cybersecurity As a SPAC with no operations, the company faces minimal cybersecurity risk and has no formal program, with no material incidents identified - The company does not consider itself to face significant cybersecurity risk due to its nature as a SPAC with no operations[309] - No formal cybersecurity risk management program has been adopted, with the management team responsible for incident response[310] - As of the date of the report, no cybersecurity threats have been identified that are likely to materially affect the company[311] Properties The company leases office space and receives administrative services from a sponsor affiliate for $20,000 per month - The company pays an affiliate of its sponsor $20,000 per month for office space and administrative services[312] Legal Proceedings The company reports no material litigation, arbitration, or governmental proceedings pending against it or its management - There is no material litigation pending against the company or its management[313] Mine Safety Disclosures This item is not applicable to the company - Not applicable[314] Part II Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities The company's units, Class A shares, and rights trade on the NYSE; no dividends paid, IPO proceeds of $231.15 million are in trust, and no stock repurchases in 2024 Market Information | Security | Symbol | Exchange | Trading Commenced | | :--- | :--- | :--- | :--- | | Units | MLACU | NYSE | December 16, 2024 | | Class A Ordinary Shares | MLAC | NYSE | February 3, 2025 | | Rights | MLACR | NYSE | February 3, 2025 | - The company has not paid any cash dividends and does not intend to prior to its initial business combination[319] - Gross proceeds of $230 million from the IPO and a portion of the $8.05 million from the private placement were used to fund the trust account with a total of $231.15 million[322][324][326] - The company did not repurchase any of its common shares during the year ended December 31, 2024[328] Management's Discussion and Analysis of Financial Condition and Results of Operations From inception to December 31, 2024, the pre-operational company reported $443,117 net income from trust account interest, with $1.38 million cash for working capital - The company is a pre-operational blank check company with activities limited to organizational matters and identifying a business combination target[331][333] Financial Highlights (June 14, 2024 to Dec 31, 2024) | Metric | Value | | :--- | :--- | | Net Income | $443,117 | | Interest Earned on Trust Account | $493,853 | | Operating Expenses | $50,736 | Liquidity and Capital Resources (as of Dec 31, 2024) | Metric | Value | | :--- | :--- | | Cash and Marketable Securities in Trust Account | $231,643,853 | | Cash Held Outside Trust Account | $1,383,392 | | Deferred Underwriting Fee Payable | $8,050,000 | - The company's Class A ordinary shares subject to redemption are classified as temporary equity on the balance sheet, as their redemption is not solely within the company's control[346] Controls and Procedures Management concluded disclosure controls and procedures were effective as of December 31, 2024, with no material changes to internal controls reported for the recent quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of December 31, 2024[354] - A management report on internal control over financial reporting is not included due to the transition period for newly public companies[355] - There were no material changes in internal control over financial reporting during the most recent fiscal quarter[356] Part III Directors, Executive Officers and Corporate Governance The company is led by CEO Paul Grinberg and CFO Douglas Horlick, with a five-member board including three independent directors and standing committees, and has adopted a Code of Ethics, disclosing potential conflicts - The executive team consists of Paul Grinberg (CEO & Chairman) and Douglas Horlick (CFO, President & Director)[360] - The Board of Directors consists of five members, with a majority (three members: Vieser, Marquez, Lager) determined to be independent under Nasdaq rules[366][368] - The Board has three standing committees (Audit, Compensation, Nominating and Corporate Governance), each composed entirely of independent directors[373] - The company has adopted a Code of Ethics applicable to all directors, officers, and employees[387] - Potential conflicts of interest exist as executive officers and directors have fiduciary duties to other entities and are not required to commit their full time to the company's affairs[392][393] Executive Compensation No cash compensation has been paid to executive officers or directors, though an agreement exists for up to $20,000 monthly for CEO and CFO services, with expense reimbursements - No cash compensation has been paid to executive officers or directors for services rendered[402] - An agreement is in place to pay the CEO and CFO a total of up to $20,000 per month for services, commencing from the IPO closing, though no payments were incurred or due under this arrangement as of Dec 31, 2024[402] - Affiliates will be reimbursed for out-of-pocket expenses incurred on behalf of the company[402] - Compensation for management after a business combination will be determined by the post-combination company's compensation committee[403] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters As of the report date, the company had 23.8 million Class A and 7.19 million Class B shares outstanding, with the sponsor owning 99.3% of Class B shares Beneficial Ownership of Common Stock | Beneficial Owner | Class A Shares Owned (%) | Class B Shares Owned (%) | | :--- | :--- | :--- | | Mountain Lake Acquisition Sponsor LLC | 2.18% | 99.3% | | Paul Grinberg (CEO) | — | 99.3% (1) | | Douglas Horlick (CFO) | — | 99.3% (1) | | All directors and officers as a group (5 individuals) | 2.18% | 100% | | AQR Capital Management, LLC | 8.32% | — | | Magnetar Financial LLC | 7.98% | — | | Polar Asset Management Partners Inc. | 7.9% | — | (1) Beneficially owned through membership and control of the Sponsor - As of the report date, there were 23,805,000 Class A shares and 7,187,500 Class B shares issued and outstanding[406] Certain Relationships and Related Transactions, and Director Independence Related party transactions include the Sponsor's $25,000 Founder Share purchase, monthly payments of up to $20,000 for administrative services, and potential working capital loans, reviewed quarterly by the audit committee - The Sponsor purchased 7,187,500 Founder Shares for a capital contribution of $25,000[411] - The company pays an affiliate of the sponsor up to $20,000 per month for office space and administrative services[415] - The sponsor or its affiliates may provide Working Capital Loans, with up to $1.5 million convertible into units at $10.00 per unit at the lender's discretion upon a business combination[417] - The audit committee reviews all payments made to the sponsor, officers, directors, or their affiliates on a quarterly basis[416] Principal Accountant Fees and Services WithumSmith+Brown, PC served as the independent auditor, billing approximately $66,560 in audit fees for the period from June 14 to December 31, 2024 Accountant Fees (June 14, 2024 - Dec 31, 2024) | Fee Category | Amount | | :--- | :--- | | Audit Fees | $66,560 | | Audit-Related Fees | $0 | | Tax Fees | $0 | | All Other Fees | $0 | - The company's audit committee pre-approves all auditing and permitted non-audit services provided by the independent auditor[424] Part IV Exhibits, Financial Statement Schedules This section lists documents filed as part of the Form 10-K, including financial statements and various exhibits, with schedules omitted - Key exhibits filed with the report include the Underwriting Agreement, Second Amended and Restated Memorandum and Articles of Association, Rights Agreement, Letter Agreement with the Sponsor, and Investment Management Trust Agreement[427] Financial Statements Report of Independent Registered Public Accounting Firm WithumSmith+Brown, PC issued an unqualified opinion on the company's financial statements for the period from inception to December 31, 2024 - The auditor, WithumSmith+Brown, PC, provided an unqualified (clean) opinion on the financial statements[440] - The financial statements cover the period from June 14, 2024 (inception) to December 31, 2024[440] Financial Statements Data As of December 31, 2024, total assets were $233.2 million, primarily trust account holdings, with $8.1 million in liabilities and a $6.5 million shareholders' deficit Balance Sheet Highlights (as of December 31, 2024) | Account | Value (USD) | | :--- | :--- | | Assets | | | Cash | 1,383,392 | | Cash and marketable securities held in Trust Account | 231,643,853 | | Total Assets | 233,231,190 | | Liabilities & Equity | | | Total Liabilities | 8,067,334 | | - Deferred underwriting fee payable | 8,050,000 | | Class A ordinary shares subject to possible redemption | 231,643,853 | | Total Shareholders' Deficit | (6,479,997) | | Total Liabilities, Redeemable Shares & Deficit | 233,231,190 | Statement of Operations (June 14, 2024 - December 31, 2024) | Account | Value (USD) | | :--- | :--- | | Formation and operational costs | (50,736) | | Interest earned on marketable securities held in Trust Account | 493,853 | | Net Income | 443,117 | Notes to Financial Statements The notes detail the company's SPAC formation, IPO, key accounting policies, significant related party transactions, and commitments including an $8.05 million deferred underwriting fee - Organization: The company was formed on June 14, 2024, to effect a business combination and has an 18-month period from its IPO to do so[457][470] - Accounting Policies: Class A ordinary shares subject to redemption are classified as temporary equity at their redemption value, and the company is an emerging growth company electing to use the extended transition period for new accounting standards[484][478] - Related Party Transactions: The Sponsor purchased 7,187,500 Founder Shares for $25,000, and the company has agreements for administrative support services and potential working capital loans from the Sponsor[506][510][511] - Commitments: The company has a deferred underwriting fee of $8.05 million payable upon completion of a business combination[515]