☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 85-2832589 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Units, each consisting of one share of Class A Common Stock and one-third of one Redeemable Warrant | CTAQU | The | ||
Class A Common Stock, par value $0.0001 per share | CTAQ | The | ||
Warrants, each exercisable for one share Class A Common Stock for $11.50 per share | CTAQW | The |
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |||
Emerging growth company | ☒ |
Page | ||||||
PART 1 – FINANCIAL INFORMATION | ||||||
Item 1. | 1 | |||||
1 | ||||||
2 | ||||||
3 | ||||||
4 | ||||||
5 | ||||||
Item 2. | ||||||
Item 3. | ||||||
20 | ||||||
Item 4. | 20 | |||||
PART II – OTHER INFORMATION | ||||||
Item 1. | 21 | |||||
Item 1A. | 21 | |||||
Item 2. | 23 | |||||
Item 3. | 23 | |||||
Item 4. | 23 | |||||
Item 5. | ||||||
Item 6. | ||||||
March 31, 2022 | December 31, 2021 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 131,958 | $ | 73,952 | ||||
Prepaid expenses | 303,417 | 324,500 | ||||||
Total Current Assets | 435,375 | 398,452 | ||||||
Cash and marketable securities held in Trust Account | 402,531,478 | 402,568,921 | ||||||
TOTAL ASSETS | $ | 402,966,853 | $ | 402,967,373 | ||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
Current liabilities | ||||||||
Accrued expenses | $ | 115,629 | $ | 265,999 | ||||
Advances from related party | 53,671 | 0 | ||||||
Total Current Liabilities | 169,300 | 265,999 | ||||||
Convertible note | 223,600 | 0 | ||||||
Warrant liabilities | 4,800,833 | 9,464,500 | ||||||
Deferred underwriting fee payable | 15,137,500 | 15,137,500 | ||||||
TOTAL LIABILITIES | 20,331,233 | 24,867,999 | ||||||
Commitments and Contingencies | ||||||||
Class A common stock subject to possible redemption, 40,250,000 shares at $10.00 per share as of March 31, 2022 and December 31, 2021 | 402,500,000 | 402,500,000 | ||||||
Stockholders’ Deficit | ||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; NaN issued and outstanding | 0— | 0— | ||||||
Class A common stock, $0.0001 par value; 200,000,000 shares authorized; 900,000 shares issued and outstanding (excluding 40,250,000 subject to possible redemption) at March 31, 2022 and December 31, 2021 | 90 | 90 | ||||||
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 10,062,500 shares issued and outstanding at March 31, 2022 and December 31, 2021 | 1,006 | 1,006 | ||||||
Accumulated deficit | (19,865,476 | ) | (24,401,722 | ) | ||||
Total Stockholders’ Deficit | (19,864,380 | ) | (24,400,626 | ) | ||||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | 402,966,853 | $ | 402,967,373 | ||||
June 30, 2022 | December 31, 2021 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash | $ | 140,476 | $ | 73,952 | ||||
Prepaid expenses | 192,167 | 324,500 | ||||||
Total Current Assets | 332,643 | 398,452 | ||||||
Cash and marketable securities held in Trust Account | 402,947,153 | 402,568,921 | ||||||
TOTAL ASSETS | $ | 403,279,796 | $ | 402,967,373 | ||||
LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT | ||||||||
Current liabilities | ||||||||
Accrued expenses | $ | 58,186 | $ | 265,999 | ||||
Income taxes payable | 72,899 | — | ||||||
Advances from related party | 200,000 | — | ||||||
Total Current Liabilities | 331,085 | 265,999 | ||||||
Convertible note | 178,300 | — | ||||||
Warrant liabilities | 2,194,667 | 9,464,500 | ||||||
Deferred underwriting fee payable | 15,137,500 | 15,137,500 | ||||||
TOTAL LIABILITIES | 17,841,552 | 24,867,999 | ||||||
Commitments and Contingencies | 0 | 0 | ||||||
Class A common stock subject to possible redemption, 40,250,000 shares at approximately $10.01 and $10.00 pershare as of June 30, 2022 and December 31, 2021, respectively | 402,766,594 | 402,500,000 | ||||||
STOCKHOLDERS’ DEFICIT | ||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; NaN issued and outstanding | 0— | 0— | ||||||
Class A common stock, $0.0001 par value; 200,000,000 shares authorized; 900,000 shares issued and outstanding (excluding 40,250,000 subject to possible redemption) at June 30, 2022 and December 31, 2021 | 90 | 90 | ||||||
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 10,062,500 shares issued and outstanding at June 30, 2022 and December 31, 2021 | 1,006 | 1,006 | ||||||
Accumulated deficit | (17,329,446 | ) | (24,401,722 | ) | ||||
TOTAL STOCKHOLDERS’ DEFICIT | (17,328,350 | ) | (24,400,626 | ) | ||||
TOTAL LIABILITIES, CLASS A COMMON STOCK SUBJECT TO POSSIBLE REDEMPTION AND STOCKHOLDERS’ DEFICIT | $ | 403,279,796 | $ | 402,967,373 | ||||
For the Three Months Ended March 31, 2022 | For the Three Months Ended March 31, 2021 | |||||||
Operating and formation costs | $ | 274,403 | $ | 238,898 | ||||
Loss from operations | (274,403 | ) | (238,898 | ) | ||||
Other income: | ||||||||
Interest earned on cash and marketable securities held in Trust Account | 70,582 | 35,544 | ||||||
Change in fair value of warrant liabilities | 4,663,667 | 6,446,833 | ||||||
Change in fair value of convertible note | 76,400 | 0 | ||||||
Total other income | 4,810,649 | 6,482,377 | ||||||
Net income | $ | 4,536,246 | $ | 6,243,479 | ||||
Weighted average shares outstanding, Class A common stock | 41,150,000 | 41,150,000 | ||||||
Basic and diluted net income per share, Class A common stock | $ | 0.09 | $ | 0.12 | ||||
Weighted average shares outstanding, Class B common stock | 10,062,500 | 10,062,500 | ||||||
Basic and diluted net income per share, Class B common stock | $ | 0.09 | $ | 0.12 | ||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Operating and formation costs | $ | 308,619 | $ | 347,695 | $ | 583,022 | $ | 586,593 | ||||||||
Loss from operations | (308,619 | ) | (347,695 | ) | (583,022 | ) | (586,593 | ) | ||||||||
Other income (expense): | ||||||||||||||||
Interest earned on cash and marketable securities held in Trust Account | 532,675 | 707 | 603,257 | 36,251 | ||||||||||||
Change in fair value of warrant liabilities | 2,606,167 | (1,508,833 | ) | 7,269,834 | 4,938,000 | |||||||||||
Change in fair value of convertible note | 45,300 | — | 121,700 | — | ||||||||||||
Total other income (expense), net | 3,184,142 | (1,508,126 | ) | 7,994,791 | 4,974,251 | |||||||||||
Income (loss) before provision for income taxes | 2,875,523 | (1,855,821 | ) | 7,411,769 | 4,387,658 | |||||||||||
Provision for income taxes | (72,899 | ) | — | (72,899 | ) | — | ||||||||||
Net income (loss) | $ | 2,802,624 | $ | (1,855,821 | ) | $ | 7,338,870 | $ | 4,387,658 | |||||||
Weighted average shares outstanding, Class A common stock | 41,150,000 | 41,150,000 | 41,150,000 | 41,150,000 | ||||||||||||
Basic and diluted net income (loss) per share, Class A common stock | $ | 0.05 | $ | (0.04 | ) | $ | 0.14 | $ | 0.09 | |||||||
Weighted average shares outstanding, Class B common stock | 10,062,500 | 10,062,500 | 10,062,500 | 10,062,500 | ||||||||||||
Basic and diluted net income (loss) per share, Class B common stock | $ | 0.05 | $ | (0.04 | ) | $ | 0.14 | $ | 0.09 | |||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance – December 31, 2021 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (24,401,722 | ) | $ | (24,400,626 ) | |||||||||||||||
Net income | — | — | — | — | — | 4,536,246 | 4,536,246 | |||||||||||||||||||||
Balance – March 31, 2022 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | 0 | $ | (19,865,476) | $ | (19,864,380) | ||||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
Balance – December 31, 2021 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (24,401,722 | ) | $ | (24,400,626 | ) | ||||||||||||||
Net income | — | — | — | — | — | 4,536,246 | 4,536,246 | |||||||||||||||||||||
Balance – March 31, 2022 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (19,865,476 | ) | $ | (19,864,380 | ) | ||||||||||||||
Accretion for Class A common stock subject to possible redemption amount | — | — | — | — | — | (266,594 | ) | (266,594 | ) | |||||||||||||||||||
Net income | — | — | — | — | — | 2,802,624 | 2,802,624 | |||||||||||||||||||||
Balance – June 30, 2022 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (17,329,446 | ) | $ | (17,328,350 | ) | ||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Deficit | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||
Balance – December 31, 2020 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (31,517,820 ) | $ | (31,516,724 ) | ||||||||||||||||
Net income | — | — | — | — | — | 6,243,479 | 6,243,479 | |||||||||||||||||||||
Balance – March 31, 2021 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | 0 | $ | (25,274,341 ) | $ | (25,273,245 ) | ||||||||||||||||
Class A Common Stock | Class B Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
Balance – December 31, 2020 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (31,517,820 | ) | $ | (31,516,724 | ) | ||||||||||||||
Net income | — | — | — | — | — | 6,243,479 | 6,243,479 | |||||||||||||||||||||
Balance – March 31, 2021 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (25,274,341 | ) | $ | (25,273,245 | ) | ||||||||||||||
Net loss | — | — | — | — | — | (1,855,821 | ) | (1,855,821 | ) | |||||||||||||||||||
Balance – June 31, 2021 | 900,000 | $ | 90 | 10,062,500 | $ | 1,006 | $ | — | $ | (27,130,162 | ) | $ | (27,129,066 | ) | ||||||||||||||
For the Three Months Ended March 31, 2022 | For the Three Months Ended March 31, 2021 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | 4,536,246 | $ | 6,243,479 | ||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Interest earned on cash and marketable securities held in Trust Account | (70,582 | ) | (35,544 | ) | ||||
Change in fair value of convertible note | (76,400 | ) | 0 | |||||
Change in fair value of warrant liabilities | (4,663,667 | ) | (6,446,833 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 21,083 | 55,481 | ||||||
Accrued expenses | (150,370 | ) | (6,964 | ) | ||||
Net cash used in operating activities | (403,690 | ) | (190,381 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Cash withdrawn from Trust Account to pay franchise and income taxes | 108,025 | 0 | ||||||
Net cash provided by investing activities | 108,025 | 0 | ||||||
Cash Flows from Financing Activities: | ||||||||
Advances from related party | 53,671 | 0 | ||||||
Proceeds from convertible promissory note | 300,000 | 0 | ||||||
Net cash provided by financing activities | 353,671 | 0 | ||||||
Net Change in Cash | 58,006 | (190,381 | ) | |||||
Cash – Beginning | 73,952 | 835,208 | ||||||
Cash – Ending | $ | 131,958 | $ | 644,827 | ||||
For the Six Months Ended June 30, | ||||||||
2022 | 2021 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | 7,338,870 | $ | 4,387,658 | ||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Interest earned on cash and marketable securities held in Trust Account | (603,232 | ) | (36,251 | ) | ||||
Change in fair value of convertible note | (121,700 | ) | — | |||||
Change in fair value of warrant liabilities | (7,269,834 | ) | (4,938,000 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Prepaid expenses | 132,333 | 166,200 | ||||||
Accrued expenses | (207,812 | ) | 8,693 | |||||
Income taxes payable | 72,899 | — | ||||||
Net cash used in operating activities | (658,476 | ) | (411,700 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Cash withdrawn from Trust Account to pay franchise and income taxes | 225,000 | 41,675 | ||||||
Net cash provided by investing activities | 225,000 | 41,675 | ||||||
Cash Flows from Financing Activities: | ||||||||
Advances from related party | 253,671 | — | ||||||
Repayment of advances from related party | (53,671 | ) | — | |||||
Proceeds from convertible promissory note | 300,000 | — | ||||||
Net cash provided by financing activities | 500,000 | — | ||||||
Net Change in Cash | 66,524 | (370,025 | ) | |||||
Cash – Beginning | 73,952 | 835,208 | ||||||
Cash – Ending | $ | 140,476 | $ | 465,183 | ||||
Gross proceeds | $ | 402,500,000 | ||
Less: | ||||
Proceeds allocated to Public Warrants | (17,710,000 | ) | ||
Class A common stock issuance costs | (21,590,535 | ) | ||
Plus: | ||||
Accretion of carrying value to redemption value | 39,300,535 | |||
Class A common stock subject to possible redemption | $ | 402,500,000 |
Gross proceeds | $ | 402,500,000 | ||
Less: | ||||
Proceeds allocated to Public Warrants | (17,710,000 | ) | ||
Class A common stock issuance costs | (21,590,535 | ) | ||
Plus: | ||||
Accretion of carrying value to redemption value | 39,300,535 | |||
Class A common stock subject to possible redemption, December 31, 2021 | $ | 402,500,000 | ||
Plus: | ||||
Accretion of carrying value to redemption value | 266,594 | |||
Class A common stock subject to possible redemption, June 30, 2022 | $ | 402,766,594 |
For the Three Months Ended March 31, 2022 | For the Three Months Ended March 31, 2021 | |||||||||||||||
Class A | Class B | Class A | Class B | |||||||||||||
Basic and diluted net income per common stock | ||||||||||||||||
Numerator: | ||||||||||||||||
Allocation of net income, as adjusted | $ | 3,644,941 | $ | 891,305 | $ | 5,016,728 | $ | 1,226,751 | ||||||||
Denominator: | ||||||||||||||||
Basic and diluted weighted average shares outstanding | 41,150,000 | 10,062,500 | 41,150,000 | 10,062,500 | ||||||||||||
Basic and diluted net income per common stock | $ | 0.09 | $ | 0.09 | $ | 0.12 | $ | 0.12 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||||||||
Class A | Class B | Class A | Class B | Class A | Class B | Class A | Class B | |||||||||||||||||||||||||
Basic and diluted net income (loss) per share of common stock | ||||||||||||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||||||||
Allocation of net income (loss), as adjusted | $ | 2,251,950 | $ | 550,674 | $ | (1,491,180 | ) | $ | (364,641 | ) | $ | 5,896,890 | $ | 1,441,980 | $ | 3,525,548 | $ | 862,110 | ||||||||||||||
Denominator: | ||||||||||||||||||||||||||||||||
Basic and diluted weighted average shares outstanding | 41,150,000 | 10,062,500 | 41,150,000 | 10,062,500 | 41,150,000 | 10,062,500 | 41,150,000 | 10,062,500 | ||||||||||||||||||||||||
Basic and diluted net income (loss) per share of common stock | $ | 0.05 | $ | 0.05 | $ | (0.04 | ) | $ | (0.04 | ) | $ | 0.14 | $ | 0.14 | $ | 0.09 | $ | 0.09 |
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
Level 3: | Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or |
Held-To-Maturity | Level | Amortized Cost | Gross Holding Gain | Fair Value | ||||||||||||||
March 31, 2022 | U.S. Treasury Securities (Matures on 06/09/22) | 1 | $ | 201,269,580 | $ | 42,246 | $ | 201,227,334 | ||||||||||
December 31, 2021 | U.S. Treasury Securities (Matures on 03/10/22) | 1 | $ | 201,302,605 | $ | 14,537 | $ | 201,317,142 |
Held-To-Maturity | Level | Amortized Cost | Gross Holding Gain | Fair Value | ||||||||||||||
June 30, 2022 | U.S. Treasury Securities (Matures on 08/09/22) | 1 | $ | 201,541,099 | $ | (122,069 | ) | $ | 201,419,030 | |||||||||
December 31, 2021 | U.S. Treasury Securities (Matures on 03/10/22) | 1 | $ | 201,302,605 | $ | 14,537 | $ | 201,317,142 |
Description | Level | March 31, 2022 | December 31, 2021 | Level | June 30, 2022 | December 31, 2021 | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Investments – U.S Treasury Securities Money Market Fund | 1 | $ | 201,405,171 | $ | 201,265,665 | |||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Warrant Liabilities – Public Warrants | 1 | $ | 4,695,833 | $ | 9,257,500 | 1 | $ | 2,146,667 | $ | 9,257,500 | ||||||||||||||
Warrant Liabilities – Private Placement Warrants | 2 | $ | 105,000 | $ | 207,000 | 2 | $ | 48,000 | $ | 207,000 | ||||||||||||||
Convertible Note – Related Party | 3 | $ | 223,600 | $ | 0 | 3 | $ | 178,300 | $ | — |
March 31, 2022 | ||||
Principal Amount | $ | 300,000 | ||
Conversion Price | $ | 10.00 | ||
Stock Price | $ | 9.82 | ||
Warrant Price | $ | 0.35 | ||
Probability of Transaction | 75 | % |
June 30, 2022 | ||||
Principal Amount | $ | 300,000 | ||
Conversion Price | $ | 10.00 | ||
Value per Share | $ | 9.85 | ||
Warrant Price | $ | 0.16 | ||
Probability of Transaction | 60.00 | % |
Convertible Promissory Note | Convertible Promissory Note | |||||||
Fair value as of January 1, 2022 | $ | 0 | $ | — | ||||
Proceeds received through convertible note—Related Party | 300,000 | |||||||
Proceeds received through convertible note – Related Party | 300,000 | |||||||
Change in valuation inputs or other assumptions | (76,400 | ) | (76,400 | ) | ||||
Fair value as of March 31, 2022 | $ | 223,600 | $ | 223,600 | ||||
Change in valuation inputs or other assumptions | (45,300 | ) | ||||||
Fair value as of June 30, 2022 | $ | 178,300 |
* | Filed herewith. |
** | Furnished. |
CARNEY TECHNOLOGY ACQUISITION CORP. II | ||||||
Date: | By: | /s/ David Roberson | ||||
Name: | David Roberson | |||||
Title: | Chief Executive Officer, Chief Financial Officer and Chairman of the Board of Directors | |||||
(Principal Executive Officer and Principal Financial Officer) |