Mountain Crest Acquisition Corp. V 10-K, filed Mar 31, 2022

Mountain Crest Acquisition Corp. V (MCAG)

10-K 2022-03-31 For: 2021-12-31

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Added on April 06, 2026

About this 10-K

Mountain Crest Acquisition Corp. V filed this 10-K on March 31, 2022, covering the fiscal year ended December 31, 2021.

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Delaware		86-2435859
(State or other jurisdiction of		(I.R.S. Employer Identification No.)
incorporation or organization)

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Units, each consisting of one share of common stock and one right to acquire 1/10 of one share of Common Stock	MCAGU	The Nasdaq Stock Market LLC
Rights included as part of the units	MCAGR	The Nasdaq Stock Market LLC
Common stock, par value $0.0001 per share	MCAG	The Nasdaq Stock Market LLC

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging Growth Company	☒

PART I				1
	ITEM 1.	BUSINESS		1
		ITEM 1A.	RISK FACTORS	16
		ITEM 1B.	UNRESOLVED STAFF COMMENTS	16
	ITEM 2.	PROPERTIES		16
	ITEM 3.	LEGAL PROCEEDINGS		16
	ITEM 4.	MINE SAFETY DISCLOSURES		16
PART II				17
	ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES		17
	ITEM 6.	[RESERVED]		17
	ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		18
		ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	20
	ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA		20
	ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE		20
		ITEM 9A.	CONTROLS AND PROCEDURES	21
		ITEM 9B.	OTHER INFORMATION	21
PART III				22
	ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE		22
	ITEM 11.	EXECUTIVE COMPENSATION		28
	ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS		29
	ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE		31
	ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES		32
PART IV				33
	ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES		33
	ITEM 16.	FORM 10-K SUMMARY		34

	●	permit stockholders to convert their shares in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and

	●	file proxy materials with the SEC.

	●	prior to the consummation of our initial business combination, we shall either (1) seek stockholder approval of our initial business combination at a meeting called for such purpose at which public stockholders may seek to convert their shares of common stock, regardless of whether they vote for or against the proposed business combination, into a portion of the aggregate amount then on deposit in the trust account, net of taxes payable, or (2) provide our stockholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account, net of taxes payable, in each case subject to the limitations described herein;

	●	we will consummate our initial business combination only if public stockholders do not exercise conversion rights in an amount that would cause our net tangible assets to be less than $5,000,001 and a majority of the outstanding shares of common stock voted are voted in favor of the business combination;

	●	if our initial business combination is not consummated within 12 months (or 15 or 18 months, as applicable) the closing of our IPO, then our existence will terminate and we will distribute all amounts in the trust account to all of our public holders of shares of common stock;

	●	we may not consummate any other business combination, merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar transaction prior to our initial business combination; and

	●	prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote on any initial business combination.

	●	Restrictions relating to liquidating the trust account if we failed to consummate a business combination in the time-frames specified above could be amended, but only if we allowed all stockholders to redeem their shares in connection with such amendment;

	●	Restrictions relating to our insiders being required to vote in favor of a business combination or against any amendments to our organizational documents could be amended to allow our insiders to vote on a transaction as they wished;

	●	The requirement of members of the management team to remain our officer or director until the closing of a business combination could be amended to allow persons to resign from their positions with us if, for example, the current management team was having difficulty locating a target business and another management team had a potential target business;

	●	The restrictions on transfer of our securities could be amended to allow transfer to third parties who were not members of our original management team;

	●	The obligation of our management team to not propose amendments to our organizational documents could be amended to allow them to propose such changes to our stockholders;

	●	The obligation of insiders to not receive any compensation in connection with a business combination could be modified in order to allow them to receive such compensation; and

	●	The requirement to obtain a valuation for any target business affiliated with our insiders, in the event it was too expensive to do so.

	●	Our having an extended period of time to consummate a business combination (although with less in trust as a certain number of our stockholders would certainly redeem their shares in connection with any such extension);

	●	Our insiders being able to vote against a business combination or in favor of changes to our organizational documents;

	●	Our operations being controlled by a new management team that our stockholders did not elect to invest with;

	●	Our insiders receiving compensation in connection with a business combination; and

	●	Our insiders closing a transaction with one of their affiliates without receiving an independent valuation of such business.

	●	our obligation to seek stockholder approval of our initial business combination or engage in a tender offer may delay the completion of a transaction;

	●	our obligation to convert shares of common stock held by our public stockholders may reduce the resources available to us for our initial business combination;

	●	our obligation to pay the deferred underwriting commission to the underwriters upon consummation of our initial business combination;

	●	our obligation to either repay working capital loans that may be made to us by our insiders or their affiliates;

	●	our obligation to register the resale of the insider shares, as well as the private units (and underlying securities) and any shares issued to our insiders or their affiliates upon conversion of working capital loans; and

	●	the impact on the target business’ assets as a result of unknown liabilities under the securities laws or otherwise depending on developments involving us prior to the consummation of a business combination.

Name	Age	Position
Suying Liu	34	Chairman, Chief Executive Officer and Chief Financial Officer
Nelson Haight	57	Director
Todd Milbourn	53	Director
Wenhua Zhang	52	Director

Name of Individual	Name of Affiliated Company	Entity’s Business	Affiliation
Suying Liu	Better Therapeutics Inc.	Healthcare	Director
	Mountain Crest Acquisition Corp. III	Special purpose acquisition company	Chairman, Chief Executive Officer, and Chief Financial Officer
	Mountain Crest Acquisition Corp. IV	Special purpose acquisition company	Chairman, Chief Executive Officer, and Chief Financial Officer

Nelson Haight	Key Energy Services, Inc.	Energy	Senior Vice President, Chief Financial Officer and Treasurer
	Mountain Crest Acquisition Corp. III	Special purpose acquisition company	Director
	Mountain Crest Acquisition Corp. IV	Special purpose acquisition company	Director

Todd Milbourn	Washington University Olin Business School	Higher Education	Vice Dean and Professor
	Mountain Crest Acquisition Corp. III	Special purpose acquisition company	Director
	Mountain Crest Acquisition Corp. IV	Special purpose acquisition company	Director

Wenhua Zhang	Azia Capital LP	Finance	Partner
	Mountain Crest Acquisition Corp. III	Special purpose acquisition company	Director
	Mountain Crest Acquisition Corp. IV	Special purpose acquisition company	Director

	Number of	Approximate Percentage of
Name and Address of Beneficial Owner⁽¹⁾	Shares Beneficially Owned	Outstanding Common Stock
Mountain Crest Global Holdings LLC ⁽²⁾	1,940,800	21.5	%
Suying Liu ⁽³⁾	1,940,800	21.5	%
Nelson Haight	2,400	*
Todd T. Milbourn	2,400	*
Wenhua Zhang	2,400	*
All directors and executive officers as a group (4 individuals)	1,948,000	21.5	%
Periscope Capital Inc. ⁽⁴⁾	464,300	5.14	%
Karpus Investment Management ⁽⁵⁾	540,390	6.0	%
Saba Capital Management GP, LLC ⁽⁶⁾	562,500	8.2	%
Beryl Capital Management LP ⁽⁷⁾	600,000	5.8	%

	Page
Report of Independent Registered Public Accounting Firm	F-1
Balance Sheet	F-2
Statement of Operations	F-3
Statement of Changes in Stockholders’ Equity	F-4
Statement of Cash Flows	F-5
Notes to Financial Statements	F-6 to F-16

Exhibit No.		Description
1.1		Underwriting Agreement, dated June 29, 2021, by and between the Registrant and Network 1 Financial Securities, Inc. (incorporated by reference to Exhibit 1.1 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
3.1		Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
3.2		Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
3.3		Bylaws (incorporated by reference to Exhibit 3.3 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
4.1		Specimen Unit Certificate (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
4.2		Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.2 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
4.3		Specimen Rights Certificate (incorporated by reference to Exhibit 4.3 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
4.4		Rights Agreement, dated June 29, 2021, by and between Continental Stock Transfer & Trust Company and the Registrant. (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
4.5*		Description of Securities
10.1		Letter Agreements, dated June 29, 2021, by and between the Registrant and each of the initial stockholders, officers and directors of the Registrant (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
10.2		Investment Management Trust Agreement, dated June 29, 2021, by and between Continental Stock Transfer & Trust Company and the Registrant. (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
10.3		Stock Escrow Agreement, dated June 29, 2021, among the Registrant, Continental Stock Transfer & Trust Company and the initial shareholders (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
10.4		Registration Rights Agreement, dated June 29, 2021, among the Registrant, Continental Stock Transfer & Trust Company and the initial shareholders (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
10.5		Indemnity Agreements, dated June 29, 2021, among the Registrant, and the directors and officers of the Registrant (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
10.6		Subscription Agreement, dated June 29, 2021, by and between the Company and Mountain Crest Global Holdings LLC (incorporated by reference to Exhibit 10.6 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
10.7		Subscription Agreement, dated June 29, 2021, by and between the Company and Network 1 Financial Securities, Inc. (incorporated by reference to Exhibit 10.7 to the Current Report on Form 8-K filed with the Securities & Exchange Commission on July 2, 2021)
14		Code of Ethics (incorporated by reference to Exhibit 14 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
31.1*		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to § 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to § 302 of the Sarbanes-Oxley Act of 2002
32.1**		Certifications of Chief Executive Officer pursuant to 18 U.S.C 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002
32.2**		Certifications of Chief Financial Officer pursuant to 18 U.S.C 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002
99.1		Form of Audit Committee Charter (incorporated by reference to Exhibit 99.1 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)
99.2		Form of Compensation Committee Charter (incorporated by reference to Exhibit 99.2 to the Registration Statement on Form S-1/A filed with the Securities & Exchange Commission on June 10, 2021)

101.INS*		XBRL Instance Document

101.SCH*		XBRL Taxonomy Extension Schema Document

101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*		XBRL Taxonomy Extension Label Linkbase Document

101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document

	MOUNTAIN CREST ACQUISITION CORP. V

Dated: March 31, 2022	By:	/s/ Suying Liu
	Name:	Suying Liu
	Title:	Chief Executive Officer and Chief Financial Officer
		(Principal Executive Officer, Principal Financial and Accounting Officer)

Signature	Title	Date

/s/ Suying Liu	Chief Executive Officer (Principal executive officer), Chief Financial Officer (Principal financial and accounting officer), and Chairman	March 31, 2022
Suying Liu

/s/ Nelson Haight	Director	March 31, 2022
Nelson Haight

/s/ Todd Milbourn	Director	March 31, 2022
Todd Milbourn

/s/ Wenhua Zhang	Director	March 31, 2022
Wenhua Zhang

Report of Independent Registered Public Accounting Firm (Firm ID:1195)	F-2
Financial Statements:
Balance Sheet	F-3
Statement of Operations	F-4
Statement of Changes in Stockholders’ Deficit	F-5
Statement of Cash Flows	F-6
Notes to Financial Statements	F-7 to F-17


ASSETS
Current Assets
Cash	$	474,538
Prepaid expenses		97,419
Total Current Assets		571,957

Investments held in Trust Account		69,000,843
TOTAL ASSETS	$	69,572,800

LIABILITIES AND STOCKHOLDERS’ DEFICIT

LIABILITIES
Current Liabilities
Accounts payable and accrued expenses	$	98,001
Accrued offering costs		7,298
Total Current Liabilities		105,299

Deferred underwriting fee payable		2,070,000
TOTAL LIABILITIES		2,175,299

COMMITMENTS AND CONTINGENCIES

Common stock subject to possible redemption, $0.0001 par value, 6,900,000 shares at redemption value of $10.00 per share		69,000,000

STOCKHOLDERS’ DEFICIT
Common Stock; $0.0001 par value; 30,000,000 shares authorized; 2,125,900 issued and outstanding (excluding 6,900,000 shares subject to possible redemption)		213
Additional paid-in capital		—
Accumulated deficit		(1,602,712	)
Total Stockholders’ Deficit		(1,602,499	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	69,572,800


General and administrative expenses	$	151,598
Loss from operations		(151,598	)

Other income:
Interest earned on investments held in Trust Account		843
Total other income		843

Net loss	$	(150,755	)

Weighted average shares outstanding of redeemable common stock		1,156,180
Basic and diluted income per share, redeemable common stock	$	5.23

Weighted average shares outstanding of non-redeemable common stock		1,603,669
Basic and diluted net loss per share, non-redeemable common stock	$	(3.87	)


	Common Stock				Additional Paid-in			Accumulated			Total Stockholders’
	Shares		Amount		Capital			Deficit			Deficit
Balance – April 8, 2021 (Inception)		—	$	—	$	—		$	—		$	—

Issuance of common stock to Sponsor		1,725,000		173		24,827			—			25,000

Proceeds allocated to Public Rights		—		—		5,865,000			—			5,865,000

Allocation of offering costs to Public Rights		—		—		(432,680	)		—			(432,680	)

Sale of 223,000 Private Units		223,000		22		2,229,978			—			2,230,000

Issuance of Representative Shares		177,900		18		1,383,599			—			1,383,617

Accretion for common stock subject to redemption amount		—		—		(9,070,724	)		(1,451,957	)		(10,522,681	)

Net loss		—		—		—			(150,755	)		(150,755	)

Balance – December 31, 2021		2,125,900	$	213	$	—		$	(1,602,712	)	$	(1,602,499	)


Cash Flows from Operating Activities:
Net loss	$	(150,755	)
Adjustments to reconcile net loss to net cash used in operating activities:
Interest earned on investments held in Trust Account		(843	)
Changes in operating assets and liabilities:
Prepaid expenses		(97,419	)
Accounts payable and accrued expenses		98,001
Net cash used in operating activities		(151,016	)

Cash Flows from Investing Activities:
Investment of cash into Trust Account		(69,000,000	)
Net cash used in investing activities		(69,000,000	)

Cash Flows from Financing Activities:
Proceeds from issuance of common stock to Sponsor		25,000
Proceeds from sale of Units,		69,000,000
Proceeds from sale of Private Units		2,230,000
Payment of underwriter compensation		(1,380,000	)
Repayment of promissory note – related party		(83,571	)
Payment of offering costs		(165,875	)
Net cash provided by financing activities		69,625,554

Net Change in Cash		474,538
Cash – Beginning of period		—
Cash – End of period	$	474,538

Non-Cash financing activities:
Offering costs included in accrued offering costs	$	7,298
Issuance of Representative Shares	$	1,383,617
Offering costs paid through promissory note	$	83,571
Accretion to Class A common stock subject to possible redemption	$	10,522,681
Deferred underwriting fee payable	$	2,070,000

Scheduled of common stock subject to possible redemption
Gross proceeds	$	69,000,000
Less:
Allocation of offering costs related to redeemable shares		(4,657,681	)
Proceeds allocated to Public Rights		(5,865,000	)
Plus:
Accretion of carrying value to redemption value		10,522,681
Common stock subject to possible redemption	$	69,000,000

Net loss per share presented in the statement of operations
	For the period from April 8, 2021 (inception) through
	December 31, 2021
Net loss	$	(150,755	)
Accretion of temporary equity to redemption value		(10,522,681	)
Net loss including accretion of temporary equity to redemption value	$	(10,673,436	)

Scheduled of basic and diluted net loss per share
	For the period from April 8, 2021 (inception) through December 31, 2021
	Redeemable			Non-redeemable
Basic and diluted net loss per share:
Numerator:
Allocation of net loss including accretion of temporary equity	$	(4,471,409	)	$	(6,202,027	)
Accretion of temporary equity to redemption value		10,522,681			—
Allocation of net loss	$	6,051,272		$	(6,202,027	)

Denominator:
Weighted-average shares outstanding		1,156,180			1,603,669
Basic and diluted net loss per share	$	5.23		$	(3.87	)

Scheduled of deferred tax asset
	December 31,
	2021
Deferred tax asset
Net operating loss carryforward	$	2,553
Startup/Organization Expenses	$	29,106
Total deferred tax asset		31,659
Valuation allowance		(31,659	)
Deferred tax asset, net of allowance	$	—

Schedule of income tax provision
	For the period from April 8, 2021 (inception) through December 31,
	2021
Federal
Current	$	—
Deferred		(31,659	)

State
Current	$	—
Deferred		—
Change in valuation allowance		31,659
Income tax provision	$	—

Scheduled of reconciliation of federal income tax rate
	For the period from April 8, 2021 (inception) through December 31,
	2021

Statutory federal income tax rate		21.0	%
State taxes, net of federal tax benefit		0.0	%
Change in valuation allowance		(21.0	)%
Income tax provision		0.0	%

Scheduled of fiar value measurments
	Trading Securities	Level		Fair Value
December 31, 2021	Investments held in Trust Account - Mutual Fund		1	$	69,000,843

	1.	I have reviewed this Annual Report on Form 10-K of Mountain Crest Acquisition Corp. V;
	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
	3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
	4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Date: March 31, 2022
	/s/ Suying Liu
	Suying Liu
	Chief Executive Officer
	(Principal executive officer)