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.



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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 Annual 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 a 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 $1.5 billion of assets under management as of March 31, 2022.

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
IPO. 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.

Comparison of the three months ended March 31, 2022 versus March 31, 2021

For the three months ended March 31, 2022, we had a net income of $7,444,176 which was primarily driven by a $8,408,400 gain from changes in fair value of derivative liabilities and $40,809 of interest income on marketable securities held in the Trust Account. This was offset by general and administrative expenses of $523,824, $50,000 of franchise tax expense, and $431,209 loss from changes in fair value of the derivative FPA.



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For the three months ended March 31, 2021, we had net income of $17,723,284 which was primarily driven by a $18,904,934 gain from changes in fair value of derivative liabilities, a $362,131 gain from changes in fair value of the derivative FPA, and $4,759 of interest income on marketable securities held in the Trust Account. This was partially offset by $1,321,353 of issuance costs attributed to the Warrants, $118,310 of franchise tax expense, and $108,877 in general and administrative expense.



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

As of March 31, 2022, we had cash of $194,145 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.

As of March 31, 2022, we had cash and marketable securities in the Trust Account of $500,070,330. 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. 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.

Material cash requirements

As of March 31, 2022, we do not have any debt, lease obligations or other capital commitments.

The underwriters are entitled to deferred fee of 3.5% of the gross proceeds of the Public Offering, or $17,500,000. The deferred fee will become payable to the underwriters from the amounts held in the trust account solely in the event that we complete our initial business combination.

Sources of cash

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.

Uses of cash



                                               Three Months Ended March 31,
                                                 2022                2021               Change

Net cash used in operating activities $ (781,248 ) $ (867,135 ) $ 85,887 Net cash used in investing activities $ - $ (500,000,000 ) $ 500,000,000 Net cash provided by financing activities $ - $ 502,391,740 $ (502,391,740 )

For the three months ended March 31, 2022, cash used in operating activities was $781,248. Net income of $7,444,176 was impacted by the non-cash changes in fair value of the derivative liabilities and forward purchase agreement of $8,408,400 and ($431,209), respectively. Additionally, changes in operating assets and liabilities provided $207,424 of cash used in operating activities.



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For the three months ended March 31, 2021, cash used in operating activities was $867,135. Net income of $17,723,284 was impacted by the non-cash changes in fair value of the derivative liabilities and forward purchase agreement of $18,904,934 and $362,131, respectively, and the issuance costs attributed to the warrant liabilities of $1,321,353. Additionally, changes in operating assets and liabilities provided $639,948 of cash used in operating activities.

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.

As of March 31, 2022 and December 31, 2021, the Company had $194,145 and $975,393 in cash not held in the Trust Account and available for working capital purposes, respectively. The Company believes it will need to raise additional funds in order to meet the expenditures required for operating the business. If the Company's estimate 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, the Company may have insufficient funds available to operate the business prior to the Initial Business Combination. Moreover, the Company may need to obtain additional financing either to complete the Initial Business Combination or to redeem a significant number of our public shares upon completion of the Initial Business Combination, in which case the Company may issue additional securities or incur debt in connection with such Initial Business Combination. If the Company is unable to complete the Business Combination because it does not have sufficient funds available, the Company will be forced to cease operations and liquidate the Trust Account.

In connection with the Company's assessment of going concern considerations in accordance with Financial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") Topic 205-40, Presentation of Financial Statements-Going Concern, the Company has until February 23, 2023, to consummate an initial business combination. It is uncertain that the Company will be able to consummate an initial business combination by this time. If an initial business combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. Additionally, the Company may not have sufficient liquidity to fund the working capital needs of the Company through one year from the issuance of these financial statements. Management has determined that the liquidity condition and mandatory liquidation, should an initial business combination not occur, and potential subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after February 23, 2023. The Company's sponsor, officers and directors may, but are not obligated to, loan the Company funds from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company's working capital needs.

Related Party Transactions



Please refer to Note 6,
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 2021 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 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.

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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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