PART I Item 1. Business. A blank check company formed in February 2021, it seeks to acquire an energy transition business, raising $230 million and operating with reduced disclosure - The company is a blank check company incorporated on February 8, 2021, for the purpose of effecting a business combination465 - The company intends to target an acquisition opportunity in the electricity transmission and distribution sector, poised to benefit from increased capacity and complexity due to decarbonization and electrification trends451473 - The company operates as an 'emerging growth company' and 'smaller reporting company,' which allows it to take advantage of certain exemptions from reporting requirements, such as reduced disclosure obligations and delayed adoption of new accounting standards514515487580 Public Offering and Trust Account Details | Metric | Amount ($) | | :----- | :----- | | Gross Proceeds from Public Offering | 230,000,000 | | Gross Proceeds from Private Placement Warrants | 12,225,000 | | Total Gross Proceeds | 242,225,000 | | Net Proceeds Deposited in Trust Account | 234,625,500 | | Deferred Underwriting Discounts and Commissions | 8,050,000 | | Underwriting Discounts and Commissions Paid | 4,600,000 | | Loans and Advances Repaid | 244,726 | Introduction This section provides an overview of the company's formation and purpose as a blank check company Market Opportunity This section outlines the market opportunities the company aims to capitalize on, particularly within the energy transition sector Business Strategy This section details the strategic approach the company will employ to identify and execute a business combination Acquisition Criteria This section describes the specific criteria the company will use to evaluate potential target businesses for acquisition Initial Business Combination This section explains the process and considerations for the company's initial business combination Our Acquisition Process This section details the step-by-step process the company follows to identify, evaluate, and acquire a target business Status as a Public Company This section describes the company's regulatory status and obligations as a publicly traded entity Financial Position This section provides an overview of the company's financial standing and resources Effecting our Initial Business Combination This section outlines the mechanisms and procedures for completing the company's initial business combination Selection of a Target Business and Structuring of our Initial Business Combination This section details the methodology for selecting a target business and structuring the initial business combination Lack of Business Diversification This section addresses the risks associated with the company's lack of diversification prior to a business combination Limited Ability to Evaluate the Target's Management Team This section discusses the challenges in thoroughly evaluating the management team of a target business Stockholders May Not Have the Ability to Approve our Initial Business Combination This section highlights the potential for stockholders to lack approval rights over the initial business combination Permitted Purchases of our Securities This section describes the conditions under which the company's securities may be purchased Redemption Rights for Public Stockholders Upon Completion of our Initial Business Combination This section details the rights of public stockholders to redeem their shares upon completion of an initial business combination Limitations on Redemptions This section outlines the restrictions and limitations that may apply to stockholder redemptions Manner of Conducting Redemptions This section describes the procedures and methods for conducting stockholder redemptions Limitation on Redemption Upon Completion of our Initial Business Combination if we Seek Stockholder Approval This section explains the limitations on redemption rights when stockholder approval is sought for a business combination Tendering Stock Certificates in Connection with a Tender Offer or Redemption Rights This section addresses the process of tendering stock certificates in relation to tender offers or redemption rights Redemption of Public Shares and Liquidation if no Initial Business Combination This section outlines the procedures for redeeming public shares and liquidating the company if an initial business combination is not completed Limited Payments to Insiders This section discusses the restrictions on payments made to company insiders Competition This section addresses the competitive landscape the company faces in identifying and acquiring a target business Human Capital Management This section provides information regarding the company's approach to managing its human capital Periodic Reporting and Financial Information This section details the company's obligations regarding periodic reporting and financial disclosures Item 1A. Risk Factors. The company faces significant risks from its blank check nature, including business combination uncertainty, potential dilution, conflicts of interest, and regulatory changes - The company has no operating history or revenues, making it difficult to evaluate its ability to achieve its business objective of completing an initial business combination30615 - Failure to complete a business combination within 18-21 months from the Public Offering closing will result in liquidation, with public stockholders receiving approximately $10.20 per share and warrants expiring without value36588622 - A new 1% U.S. federal excise tax on stock repurchases (including redemptions) after December 31, 2022, could reduce the cash available for distribution in a subsequent liquidation3940591625 - Conflicts of interest may arise due to officers and directors allocating time to other businesses, potential affiliated transactions, and their financial incentives tied to completing a business combination11912012212312414951055369 Risks Relating to our Search for, Consummation of, or Inability to Consummate, a Business Combination and Post-Business Combination Risks This section details the various risks associated with the company's efforts to find, complete, or fail to complete a business combination, as well as post-combination risks Risks Relating to our Securities This section outlines the risks specifically pertaining to the company's securities, including potential volatility and liquidity issues Risks Relating to our Sponsor and Management Team This section addresses risks stemming from the company's sponsor and management team, including potential conflicts of interest and limited resources General Risk Factors This section covers broader risk factors that could impact the company's operations and financial performance Item 1B. Unresolved Staff Comments. The company has no unresolved staff comments from the SEC - The company has no unresolved staff comments243 Item 2. Properties. The company's executive offices are located in New York, NY, and the current office space is considered adequate for its operations - The company's executive offices are located at 595 Madison Avenue, 28th Floor, New York, NY 10022150 - The current office space is considered adequate for current operations150 Item 3. Legal Proceedings. There is no material litigation, arbitration, or governmental proceeding currently pending against the company or its management team - There is no material litigation, arbitration or governmental proceeding currently pending against the company or any members of its management team244 Item 4. Mine Safety Disclosures. The company is not subject to mine safety disclosures - The company is not applicable for mine safety disclosures246 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The company's units, Class A common stock, and public warrants trade on the NYSE under symbols BRD.U, BRD, and BRD.WS, respectively, with no cash dividends paid to date - Units, Class A common stock, and public warrants trade on the NYSE under symbols BRD.U, BRD, and BRD.WS, respectively, since November 29, 2021, with separate trading commencing January 14, 2022250500 - The company has not paid cash dividends and does not intend to prior to the completion of a business combination53 - No securities are authorized for issuance under equity compensation plans54 Holders of Record (March 7, 2023) | Security Type | Number of Holders | | :------------ | :---------------- | | Units | 1 | | Class A Common Stock | 1 | | Class V Common Stock | 2 | | Public Warrants | 1 | | Private Placement Warrants | 1 | Market Information This section provides details on where the company's securities are traded and their trading symbols Holders This section lists the number of record holders for various classes of the company's securities Dividends This section discusses the company's dividend policy and history Securities Authorized for Issuance Under Equity Compensation Plans This section details any securities authorized for issuance under equity compensation plans Recent Sales of Securities; Use of Proceeds from Registered Offerings This section provides information on recent sales of securities and the use of proceeds from registered offerings Item 6. Reserved This item is reserved and contains no information Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. A blank check company with no operating history, it focuses on a business combination, reported $1.2 million net income in 2022, but faces going concern doubts due to limited capital - The company is a blank check company with no operating results or revenues to date, with activities focused on organizational tasks and searching for an initial business combination30157723 - The company's financial condition raises substantial doubt about its ability to continue as a going concern, with a working capital deficit of $30,841 as of December 31, 2022, and insufficient cash outside the trust account to operate until the business combination deadline of May 29, 20233758967212728106 Financial Performance Summary | Metric | Year Ended Dec 31, 2022 | Period Feb 8, 2021 (inception) - Dec 31, 2021 | | :------------------------------------ | :---------------------- | :------------------------------------------------ | | Net Income (Loss) | $1,207,341 | $(281,753) | | Interest Income on Trust Account | $3,320,716 | $1,459 | | Operating and Formation Costs | $1,293,844 | $105,070 | | Income Tax Expense | $617,905 | $0 | | Franchise Tax Expense | $201,626 | $178,142 | Overview This section provides a general overview of the company's financial condition and operational focus Results of Operations This section analyzes the company's financial performance and key operational outcomes for the reported periods Liquidity, Capital Resources and Going Concern This section discusses the company's liquidity, capital resources, and the assessment of its ability to continue as a going concern Item 7A. Quantitative and Qualitative Disclosures About Market Risk. This section refers to the financial statements for quantitative and qualitative disclosures about market risk, indicating no separate discussion is provided here - Reference is made to Pages F-1 through F-23 (financial statements) for quantitative and qualitative disclosures about market risk740 Item 8. Financial Statements and Supplementary Data. This item indicates that the financial statements and supplementary data are included elsewhere in the report - The financial statements and supplementary data are included elsewhere in the report194 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. The company reports no changes in or disagreements with accountants on accounting and financial disclosure - There are no changes in or disagreements with accountants on accounting and financial disclosure195223 Item 9A. Controls and Procedures. The CEO and CFO concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2022 - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of December 31, 2022196 - Management assessed the effectiveness of its internal control over financial reporting as of December 31, 2022, using COSO criteria, and concluded it was effective197 - There has been no material change in internal control over financial reporting during the most recently completed fiscal quarter251 Disclosure Controls and Procedures This section describes the company's disclosure controls and procedures and their effectiveness Management's Annual Report on Internal Control over Financial Reporting This section presents management's annual report on the effectiveness of internal control over financial reporting Item 9B. Other Information. This item is not applicable and contains no information - This item is not applicable227 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable and contains no information - This item is not applicable227 PART III Item 10. Directors, Executive Officers and Corporate Governance. The board, led by CEO Gregory A. Beard and CFO Sarah James, operates as a 'controlled company' with governance exemptions, established committees, and significant conflicts of interest - The company is a 'controlled company' under NYSE rules because initial stockholders have the right to elect all directors prior to a business combination, allowing it to elect not to comply with certain corporate governance requirements131261 - The board has three standing committees: audit, compensation, and nominating and corporate governance. Messrs. Reeves, Cherington, and Lurie are independent directors, with Mr. Reeves as audit committee financial expert and Mr. Cherington chairing compensation and nominating committees263264265296298 - Significant conflicts of interest exist due to officers' and directors' affiliations with other entities, potential competition for acquisition opportunities, and financial incentives tied to completing a business combination122123124304305 Officers and Directors | Name | Age | Position | | :---------------- | :-- | :-------------------------------- | | Gregory A. Beard | 51 | Chairman of the Board and CEO | | Sarah James | 40 | CFO and Chief Accounting Officer | | Robert C. Reeves | 53 | Director | | Charles Cherington | 60 | Director | | Yoav Lurie | 39 | Director | Officers and Directors This section lists the company's executive officers and directors, including their ages and positions Director Independence This section discusses the independence status of the company's directors according to applicable listing standards Officer and Director Compensation This section outlines the compensation arrangements for the company's officers and directors Controlled Company Status This section explains the company's status as a 'controlled company' and its implications for corporate governance Committees of the Board of Directors This section describes the various committees established by the board of directors and their responsibilities Director Nominations This section details the process for nominating directors to the company's board Delinquent Section 16(a) Reports This section addresses any delinquent reports filed under Section 16(a) of the Exchange Act Compensation Committee Interlocks and Insider Participation This section discusses any interlocks among compensation committees and insider participation in compensation decisions Code of Ethics This section describes the company's code of ethics applicable to its officers, directors, and employees Corporate Governance Guidelines This section outlines the corporate governance guidelines adopted by the company Conflicts of Interest This section details potential conflicts of interest involving the company's officers, directors, and sponsor Limitation on Liability and Indemnification of Officers and Directors This section describes the provisions for limiting liability and indemnifying the company's officers and directors Item 11. Executive Compensation. Officers and directors receive no cash compensation prior to a business combination, except for administrative support reimbursements, with post-combination fees to be disclosed - No cash compensation is paid to officers or directors for services prior to the completion of an initial business combination, other than administrative support reimbursements of $25,000 per month (including $16,667 for the CFO)25259288 - After a business combination, directors or management may receive consulting or management fees, with amounts to be fully disclosed to stockholders233289316 - No officers currently serve, or in the past year have served, as a member of the compensation committee of any entity that has one or more officers serving on the company's board of directors275343 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. This section details beneficial ownership of common stock by the sponsor, executive officers, directors, and 5% holders, including founder shares and private placement warrants - Founder shares, held by initial stockholders, represent 20% of the total outstanding Class A common stock (assuming exchange)346 - The sponsor purchased 12,225,000 private placement warrants at $1.00 each, exercisable for Class A common stock at $11.50 per share, which are generally non-transferable until 30 days after a business combination152348 Beneficial Ownership of Common Stock (March 7, 2023) | Name and Address of Beneficial Owner | Class A Common Stock | Class V Common Stock | Percentage of Outstanding Common Stock | | :----------------------------------- | :------------------- | :------------------- | :------------------------------------- | | Beard Energy Transition Acquisition Sponsor LLC | — | 5,750,000 | 20.0% | | Gregory A. Beard | 1,250 | 5,751,250 | 20.0% | | Saba Capital Management, L.P. | 1,779,860 | — | 7.70% | | Highbridge Capital Management, LLC | 1,647,729 | — | 7.16% | | Adage Capital Partners, L.P. | 1,250,000 | — | 5.43% | | Sculptor Capital LP | 1,073,689 | — | 4.67% | | All executive officers and directors as a group | 1,250 | 5,751,250 | 20% | Beneficial Ownership Table This section presents a table detailing the beneficial ownership of the company's common stock Founder Shares This section describes the founder shares held by initial stockholders and their characteristics Private Placement Warrants This section provides information on the private placement warrants, including their purchase and exercise terms Item 13. Certain Relationships and Related Transactions, and Director Independence. This section details related party transactions, including sponsor warrant purchases, administrative support, potential working capital loans, and registration rights, while identifying independent directors - The sponsor purchased 12,225,000 private placement warrants for $12,225,000 simultaneously with the Public Offering348 - The company reimburses its sponsor or an affiliate $25,000 per month for administrative support, including $16,667 for the CFO's payments350 - The sponsor or affiliates may provide Working Capital Loans, convertible into warrants, to finance transaction costs or extension funding, with no current borrowings325352 - Initial stockholders and warrant holders are granted registration rights for their securities, with the company bearing the registration expenses326327353 - Messrs. Cherington, Reeves, and Lurie are determined to be independent directors as per NYSE listing standards and SEC rules328355 Conflicts of Interest This section discusses potential conflicts of interest arising from related party relationships Administrative Services Agreement This section describes the agreement for administrative services provided by the sponsor or an affiliate Related Party Loans and Advances This section details any loans or advances made between the company and related parties Registration Rights This section outlines the registration rights granted to certain security holders Director Independence This section identifies the independent directors based on applicable listing standards Item 14. Principal Accountant Fees and Services. This section details the fees paid to Grant Thornton LLP for audit and other services, with the audit committee responsible for pre-approving all services - The audit committee is responsible for appointing, setting compensation, and overseeing the work of the independent registered public accounting firm, including pre-approving all audit and permitted non-audit services332 Fees Paid to Grant Thornton LLP | Fee Type | Year Ended Dec 31, 2022 | Period Feb 8, 2021 (inception) - Dec 31, 2021 | | :--------------- | :---------------------- | :------------------------------------------------ | | Audit Fees | $103,950 | $99,750 | | Audit-Related Fees | $0 | $0 | | Tax Fees | $0 | $0 | | All Other Fees | $0 | $0 | Audit Fees This section specifies the fees paid for audit services provided by the principal accountant Audit-Related Fees This section details any fees paid for audit-related services Tax Fees This section outlines the fees paid for tax-related services All Other Fees This section covers any other fees paid to the principal accountant not categorized elsewhere Policy on Board Pre-Approval of Audit and Permissible Non-Audit Services of the Independent Auditors This section describes the board's policy regarding the pre-approval of audit and permissible non-audit services by the independent auditors PART IV Item 15. Exhibits and Financial Statement Schedules. This section lists all exhibits and financial statement schedules filed as part of the report, including certificates of incorporation, bylaws, and various agreements - The report includes various exhibits such as the Certificate of Incorporation, Amended and Restated Bylaws, Specimen Unit/Stock/Warrant Certificates, Warrant Agreements, Trust Agreement, Registration Rights Agreement, Administrative Support Agreement, Promissory Note, and Securities Subscription Agreement359360 Exhibits This section provides a comprehensive list of all exhibits included in the report Financial Statements The audited financial statements present the company's financial position and performance, with the auditor's report highlighting a 'going concern' uncertainty due to lack of revenue and dependence on a business combination - Grant Thornton LLP audited the consolidated financial statements, expressing an opinion that they present fairly the financial position and results of operations341367 - The auditor's report raises substantial doubt about the company's ability to continue as a going concern due to no present revenue, dependence on a business combination, and insufficient cash for planned activities368398 Report of Independent Registered Public Accounting Firm This section contains the independent auditor's report on the company's financial statements Consolidated Balance Sheets This section presents the company's consolidated balance sheets, detailing assets, liabilities, and equity Consolidated Statements of Operations This section provides the company's consolidated statements of operations, showing revenues, expenses, and net income or loss Consolidated Statements of Changes in Stockholders' Deficit This section presents the consolidated statements of changes in stockholders' deficit, outlining changes in equity accounts Consolidated Statements of Cash Flows This section provides the company's consolidated statements of cash flows, detailing cash inflows and outflows from operating, investing, and financing activities Notes to Consolidated Financial Statements This section contains detailed notes that provide additional information and explanations for the figures presented in the financial statements NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS This note describes the company's organizational structure and its primary business operations NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This note outlines the significant accounting policies adopted by the company in preparing its financial statements NOTE 3. INITIAL PUBLIC OFFERING This note provides details regarding the company's initial public offering NOTE 4. RELATED PARTY TRANSACTIONS This note discloses transactions between the company and its related parties NOTE 5. WARRANTS This note provides information about the company's outstanding warrants NOTE 6. STOCKHOLDERS' DEFICIT This note details the components and changes in the company's stockholders' deficit NOTE 7. COMMITMENTS AND CONTINGENCIES This note describes the company's commitments and any contingent liabilities NOTE 8. INCOME TAX This note provides information on the company's income tax provisions and related disclosures NOTE 9. FAIR VALUE MEASUREMENTS This note explains the company's fair value measurements for financial instruments
Beard Energy Transition Acquisition (BRD) - 2022 Q4 - Annual Report