References to "we," "us," "company" or "our company" are to Mason Industrial
Technology, Inc. The following discussion and analysis of the Company's
financial condition and results of operations should be read in conjunction with
the unaudited condensed financial statements and the notes thereto contained
elsewhere in this report. Certain information contained in the discussion and
analysis set forth below includes forward-looking statements that involve risks
and uncertainties.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form
10-Q
includes forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). We have
based these forward- looking statements on our current expectations and
projections about future events. These forward-looking statements are subject to
known and unknown risks, uncertainties and assumptions about us that may cause
our actual results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity, performance or
achievements expressed or implied by such
forward-looking
statements. In some cases, you can identify forward-looking statements by
terminology such as "may," "should," "could," "would," "expect," "plan,"
"anticipate," "believe," "estimate," "continue," or the negative of such terms
or other similar expressions. Factors that might cause or contribute to such a
discrepancy include, but are not limited to, those described in our other U.S.
Securities and Exchange Commission ("SEC") filings.
Overview
We are a blank check company incorporated as a Delaware corporation and formed
for the purpose of effecting a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business combination with
one or more businesses, which we refer to throughout this Report as our initial
business combination. We consummated our initial public offering on February 2,
2021.
We currently intend to concentrate our efforts in identifying businesses in the
industrial technology, advanced materials or specialty chemicals industries
(collectively, "Advanced Industrials"). A common theme across these sectors is
the application of technology to make industrial processes more profitable,
faster, more sustainable, less capital-intensive and less complex. Specifically,
we intend to identify businesses that apply innovative technology to
engineering, production, assembly and manufacturing. These innovations include a
wide range of automation, analytics and productivity tools, as well as control
systems, high precision technologies, sustainability technologies, high
performance computing and robotics. These technologies enable companies to
confront numerous challenges inherent in their daily operations, such as rising
wage rates, globalization, increased regulation, higher quality standards,
heightened focus on sustainability and tighter timelines. We are also interested
in companies that participate in market segments that are adjacent to Advanced
Industrials. We believe that there are many potential targets within Advanced
Industrials that could become attractive public companies. These potential
targets exhibit a broad range of business models and financial characteristics,
with enterprise values ranging between $1 billion and $3 billion. They span a
wide continuum that includes both high growth emerging companies and mature
businesses with established growth profiles, recurring revenues and strong cash
flows. They are generally characterized by strong intellectual property,
differentiated product offerings, compelling customer value propositions and
corporate cultures that are data-driven and innovative.
We are not, however, required to complete our initial business combination with
an Advanced Industrials business and, as a result, we may pursue a business
combination outside of this industry. We are seeking to acquire mature
businesses that we believe are fundamentally sound, yet which could benefit from
additional financial, operational, strategic or managerial resources to achieve
maximum value potential. We are also targeting earlier stage, yet established,
companies that exhibit the potential to disrupt the market segments in which
they participate through innovation and which offer the potential of sustained
high levels of revenue growth.
Our sponsor is affiliated with and controlled by Mason Capital, a registered
investment adviser under the Investment Advisers Act of 1940, as amended, which
was established in 2000 and had over $1.4 billion of assets under management as
of June 30, 2021.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date.
All activity from our inception through the date of our IPO, February 2, 2021,
was in preparation for our IPO. Since our IPO, our activity has been limited to
the evaluation of Business Combination candidates. We do not expect to generate
any operating revenues until the closing and completion of our Business
Combination. We expect to generate non-operating income in the form of interest
income on marketable securities held after the Initial Public Offering. We incur
increased expenses as a result of being a public company (for legal, financial
reporting, accounting and auditing compliance), as well as for due diligence
expenses.

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For the three months ended June 30, 2021, we had a net loss of $5,293,113, which
was primarily driven by a $5,205,067 loss from changes in fair value of
derivative warrant liabilities, general and administrative expenses of $303,740,
and franchise tax of $50,000. The expenses were partially offset by a $258,095
gain from changes in fair value of the derivative FPA, and $7,599 of interest
income on marketable securities held in the Trust Account.
For the six months ended June 30, 2021, we had net income of $12,430,171, which
was primarily driven by a $13,699,867 gain from changes in fair value of
derivative warrant liabilities, a $620,226 gain from changes in fair value of
the derivative FPA, and $12,358 of interest income on marketable securities held
in the Trust Account. This was partially offset by $412,617 in general and
administrative expense, $168,310 of franchise tax expense, and $1,321,353 of
issuance costs attributed to the Warrants.
As described in Note 2,
Summary of Significant Accounting Policies
, in "Part 1. Financial Information - Item 1. Financial Statements," we account
for (i) the Warrants issued in connection with our IPO and Private Placement and
(ii) the forward purchase agreement as derivative instruments which were
initially recorded at their fair value. These derivative instruments are subject
to remeasurement at each balance sheet date until exercised, and any change in
fair value is recognized in our statements of operations.
Liquidity and Capital Resources
Prior to the completion of the IPO, our liquidity needs were satisfied through
receipt of $25,000 from the sale of Founder Shares to Mason Industrial Sponsor
LLC, or the "Sponsor".
On February 2, 2021, we consummated the IPO of 50,000,000 Units at a price of
$10.00 per Unit generating net proceeds of $472,096,741. Transaction costs were
$27,903,259, including $10,000,000 of underwriting fees, $17,500,000 of deferred
underwriting fees and $403,259 of other offering costs in connection with the
IPO. Simultaneously with the closing of the IPO, we consummated the sale of
8,813,334 Private Placement Warrants to our Sponsor at a price of $1.50 per
warrant, generating gross proceeds of $13,220,000. Following the IPO and the
sale of the Private Placement Warrants, a total of $500,000,000 was placed in a
Trust Account and following the payment of certain transaction expenses.
For the six months ended June 30, 2021, cash used in operating activities was
$1,047,575. Net income of $12,430,171 was impacted by the non-cash changes in
fair value of the derivative warrant liability and forward purchase agreement of
$13,699,867 and $620,226, respectively, and the issuance costs attributed to the
warrant liabilities of $1,321,353. Additionally, changes in operating assets and
liabilities provided $466,648 of cash used in operating activities.
As of June 30, 2021, we had cash and marketable securities in the Trust Account
of $500,012,358. We intend to use substantially all of the funds held in the
Trust Account, including any amounts representing interest earned on the Trust
Account (less deferred underwriting commissions) to complete our initial
Business Combination. We may withdraw interest from the trust account to pay
franchise and income taxes. To the extent that our capital stock or debt is
used, in whole or in part, as consideration to complete our initial Business
Combination, the remaining proceeds held in the Trust Account will be used as
working capital to finance the operations of the target business or businesses,
make other acquisitions and pursue our growth strategies.
As of June 30, 2021, we had cash of $1,511,389 held outside the Trust Account.
We intend to use the funds held outside the Trust Account primarily to identify
and evaluate target businesses, perform business due diligence on prospective
target businesses, travel to and from the offices, plants or similar locations
of prospective target businesses or their representatives or owners, review
corporate documents and material agreements of prospective target businesses,
and structure, negotiate and complete a Business Combination.
In order to fund working capital deficiencies and/or finance transaction costs
in connection with an initial Business Combination, our Sponsor or an affiliate
of our Sponsor or certain of our officers and directors may, but are not
obligated to, loan us funds as may be required. If we complete our initial
Business Combination, we would repay such loaned amounts. In the event that our
initial Business Combination does not close, we may use a portion of the working
capital held outside the Trust Account to repay such loaned amounts but no
proceeds from our Trust Account would be used for such repayment. Up to
$1,500,000 of such loans may be convertible into warrants, at a price of $1.50
per warrant at the option of the lender. The warrants would be identical to the
Private Placement Warrants, including as to exercise price, exercisability and
exercise period.
We do not believe we will need to raise additional funds in order to meet the
expenditures required for operating our business. However, if our estimates of
the costs of identifying a target business, undertaking
in-depth
due diligence and negotiating an initial Business Combination are less than the
actual amount necessary to do so, we may have insufficient funds available to
operate our business prior to our Business Combination. Moreover, we may need to
obtain additional financing either to complete our Business Combination or
because we become obligated to redeem a significant number of our public shares
upon completion of our Business Combination, in which case we may issue
additional securities or incur debt in connection with such Business
Combination. Subject to compliance with applicable securities laws, we would
only complete such financing simultaneously with the completion of our Business
Combination. If we are unable to complete our initial Business Combination
because we do not have sufficient funds available to us, we will be forced to
cease operations and liquidate the Trust Account. In addition, following our
initial Business Combination, if cash on hand is insufficient, we may need to
obtain additional financing in order to meet our obligations.

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Related Party Transactions
Please refer to Note 5,
Related Party Transactions
, in "Part 1. Financial Information - Item 1. Financial Statements" for a
discussion of our related party transactions.
Critical Accounting Policies and Estimates
Our management makes a number of significant estimates, assumptions and
judgments in the preparation of our financial statements. See "Note 2-Summary of
Significant Account Policies" in our 2020 Form
10-K,
for a discussion of the estimates and judgments necessary in our accounting for
common stock subject to possible redemption, and net income (loss) per common
share. Any new accounting policies or updates to existing accounting policies as
a result of new accounting pronouncements have been included in the notes to our
condensed financial statements contained in this Quarterly Report on Form
10-Q.
The application of our critical accounting policies may require management to
make judgments and estimates about the amounts reflected in the condensed
financial statements. Management uses historical experience and all available
information to make these estimates and judgments. Different amounts could be
reported using different assumptions and estimates.
Recent Accounting Pronouncements
Please refer to Note 2,
Summary of Significant Accounting Policies
, in "Part 1. Financial Information - Item 1. Financial Statements" for a
discussion of recent accounting pronouncements and their anticipated effect on
our business.
JOBS Act
On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains
provisions that, among other things, relax certain reporting requirements for
qualifying public companies. We qualify as an "emerging growth company" under
the JOBS Act and are allowed to comply with new or revised accounting
pronouncements based on the effective date for private (not publicly traded)
companies. We elected to delay the adoption of new or revised accounting
standards, and as a result, we may not comply with new or revised accounting
standards on the relevant dates on which adoption of such standards is required
for
non-emerging
growth companies. As a result, our financial statements may not be comparable to
companies that comply with new or revised accounting pronouncements as of public
company effective dates.
As an "emerging growth company", we are not required to, among other things,
(i) provide an auditor's attestation report on our system of internal controls
over financial reporting pursuant to Section 404, (ii) provide all of the
compensation disclosure that may be required of
non-emerging
growth public companies under the Dodd-Frank Wall Street Reform and Consumer
Protection Act, (iii) comply with any requirement that may be adopted by the
PCAOB regarding mandatory audit firm rotation or a supplement to the auditor's
report providing additional information about the audit and the financial
statements (auditor discussion and analysis), and (iv) disclose certain
executive compensation related items such as the correlation between executive
compensation and performance and comparisons of the CEO's compensation to median
employee compensation. These exemptions will apply for a period of five years
following the completion of our initial public offering or until we are no
longer an "emerging growth company," whichever is earlier.

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