SCHEDULE 13G/A: Kingstown Entities and Guy Shanon Disclose Significant Stake in Intuitive Machines, Holding Up to 8.0% of Class A Common Stock
Beneficial Ownership Disclosure
Kingstown 1740 Fund L.P. and related entities, along with Guy Shanon, have disclosed beneficial ownership of up to 8.0% of Intuitive Machines, Inc.'s Class A Common Stock, including shares held directly and through warrants.
Summary
- Kingstown 1740 Fund L.P., Kingstown Capital Partners LLC, Kingstown Capital Management L.P., and Kingstown Management GP LLC collectively beneficially own 5,898,404 shares of Intuitive Machines, Inc. Class A Common Stock, representing 6.1% of the class.
- This ownership includes 1,585,904 shares held directly by Kingstown 1740, 3,218,750 shares underlying $11.50 warrants, and 1,093,750 shares underlying a Preferred Investor Warrant exercisable at $6.00 per share.
- Guy Shanon, as the managing member of Kingstown Management GP LLC and Kingstown Capital Partners LLC, beneficially owns a total of 7,772,611 shares, representing 8.0% of the Class A Common Stock.
- Mr. Shanon's ownership includes 792,523 shares held directly, 1,081,684 shares underlying $11.50 warrants held by him, and the 5,898,404 shares beneficially owned by the Kingstown entities due to his shared control.
- The percentage ownership calculations are based on 95,969,626 shares outstanding for the Kingstown group and 97,051,310 shares outstanding for Guy Shanon, which account for shares reported as outstanding as of November 8, 2024, shares issued on December 5, 2024, and warrants exercisable within 60 days.
- All reporting persons have shared voting and dispositive power over the shares held by Kingstown 1740 Fund L.P.
- The filing is an Amendment No. 2 to a Schedule 13G, indicating an update to previously reported ownership.
Sentiment
Score: 5
Explanation: The document is a factual disclosure of beneficial ownership and does not contain information that would indicate a positive or negative sentiment regarding the company's performance or prospects.
Positives
- The significant stake held by Kingstown entities and Guy Shanon indicates a notable investment and potential long-term interest in Intuitive Machines, Inc.
- The beneficial ownership blockers (9.8%) on warrants are currently not limiting their exercise, suggesting flexibility for the investors to increase their direct shareholding if desired, up to the cap.
Risks
- The existence of warrants, while not currently limited by beneficial ownership blockers, introduces potential future dilution if exercised, which could impact existing shareholders.
- The concentration of a significant ownership stake (up to 8.0%) in a single group/individual could influence corporate control or strategic decisions, though the filing certifies the shares are not held for the purpose of changing or influencing control.
Future Outlook
NA
Industry Context
This filing is a standard disclosure of significant beneficial ownership by an investment group and an individual, common in the financial industry for publicly traded companies. It does not provide broader industry trends or competitive analysis.
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Beneficial Ownership Blocker | Kingstown 1740 Fund L.P. and Guy Shanon have opted for a 9.8% beneficial ownership blocker on their warrants, preventing exercise if it would result in ownership exceeding 9.8% of Class A Common Stock. | NA | This provision limits the maximum beneficial ownership concentration by these parties, potentially mitigating concerns about excessive control, though it does not currently limit their ability to exercise warrants. |
Related Party Transactions
- The filing details the intricate relationships between Kingstown 1740 Fund L.P., Kingstown Capital Partners LLC, Kingstown Capital Management L.P., Kingstown Management GP LLC, and Guy Shanon, where Mr. Shanon holds managing member roles and shared voting/dispositive power over the securities held by the Kingstown entities. This constitutes a related party structure for beneficial ownership reporting.
Stakeholder Impact
- Shareholders: The disclosure provides transparency regarding significant institutional and individual ownership, which can influence market perception and liquidity. The existence of warrants and their potential exercise could lead to dilution.
- Management: Awareness of significant shareholders can influence strategic decisions and engagement with investors.
Key Dates
| Date | Description |
|---|---|
| 2024-11-08 | Date as of which 80,857,602 shares of Class A Common Stock were reported outstanding in the Issuer's Form 10-Q. |
| 2024-11-15 | Date the Issuer's Quarterly Report on Form 10-Q was filed with the SEC. |
| 2024-12-05 | Date 10,799,524 shares of Class A Common Stock were issued, as reported in the Issuer's Form 8-K. |
| 2024-12-31 | Date of event which requires filing of this Schedule 13G statement. |
| 2025-01-10 | Date the conversion price of the Issuer's 10% Series A Cumulative Convertible Preferred Stock was adjusted to $3.00. |
| 2025-02-14 | Date the Schedule 13G and Joint Filing Agreement were signed. |
Keywords
Intuitive Machines, SEC filing, Schedule 13G, beneficial ownership, Class A Common Stock, warrants, investment fund, Kingstown, institutional ownership, equity stake
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