Section · AVAT — Nasdaq: AVAT · CIK 0002092446
Avalanche Treasury Corp.
The treasury that borrowed. It holds roughly 3.5% of all circulating AVAX, has drawn $33M against it, and disclosed a going-concern note in its first 10-Q — withdrawn in its second. Its paper trail stops one inch short of the chain. Its twin, AVAX One, is covered separately.
09 — The Prospectus
What the company put in writing
On 27 July 2026 AVAT filed a resale prospectus, a Form 424B3, so that its early holders could sell their shares on the open market. It is the longest document the company has filed and the only one that puts executive pay, internal controls, lock-ups, the Foundation deal and the closing-day share register in one place. This page reads it line by line. Every figure is the filing’s own; where the document disagrees with itself, both versions are shown.
Last sale price on the cover: $0.313 (2026-07-24). Holders of record: 33, as of 2026-07-21. The company receives no proceeds from the resales.
Who is registered to sell
The prospectus registers 15,690,755 Class A shares, 39.7% of the fully diluted total, for sale by eleven named holders. The sponsor, the sponsor’s affiliate, the token seller and the SPAC’s own insiders, one of them a sitting director, can all sell into a stock already at a deep discount to the tokens behind it.
Two-fifths of AVAT's economic shares are registered for insiders to sell: 15,690,755 of 39,514,805
One bar is every Class A share as of 21 Jul 2026, the filing's own fully diluted basis. The coloured run from the left is the shares the 424B3 registers for resale, drawn to true proportion and grouped by holder: Dragonfly and its affiliate Astral in teal, the Avalanche Foundation in claret, the Mountain Lake SPAC insiders in grey, the adviser in light grey. The pale remainder is every other Class A share: the pre-merger LLC holders and the public. The legend lists every holder and count.
Source: AVAT 424B3, 27 Jul 2026, selling-holder table and cover; Class A count as of 21 Jul 2026 from the same filing.
When they can sell is stated twice, differently. Dragonfly and the MLAC insiders are restricted until the earlier of 180 days after the closing (about 8 December 2026) or a $12.50 VWAP for 20 consecutive trading days. The risk factors describe the same lock-up as running to the one-year anniversary of the closing. Dragonfly and the SPAC insiders together hold 26.69% of Class A; Dragonfly alone about 19.75%. A further 15,605,639 shares carry registration rights under the amended registration-rights agreement.
Astral’s 4,000,000 are half in escrow and half due to be issued 60 days after the 11 June closing, so around 10 August. If issued on schedule, the Class A count this site divides by has risen by 2,000,000 since the filing, which lowers NAV per share by about 5%; no filing has yet confirmed it.
What the officers are paid, and the cash it sits against
Fixed annual salary for three officers, per their offer letters
Target annual bonuses on top, at the company’s discretion
Cash at the operating company on 31 March 2026
Working-capital deficit on the same date, with no committed outside liquidity
The offer letters also promised equity: time-vesting units worth $7.5M for the CEO and $2M for the COO, and performance units worth $9M and $2.5M that vested on share-price hurdles. On 12 July 2026 the two accepted stock options instead (2,700,000 and 1,100,000, exercise price $0.54) and forfeited all rights to the performance-based units. In plain terms, $11.5M of price-hurdle equity, designed around a $10 SPAC share, became options struck at a post-crash price.
Directors who are not employees get a $85,000 retainer, $100,000 more for a chair, and committee fees of $10,000/$25,000 (audit, member/chair), $8,000/$20,000 (compensation) and $6,000/$15,000 (nominating). Advisory-board members get RSUs equal to 0.20% of fully diluted stock each, on 60 days’ notice either way. No director was paid in 2025 and no equity was outstanding at year-end.
The first quarter, line by line
The prospectus carries the operating company’s statement of operations for the three months to 31 March 2026. It is the only quarter on file with every line visible, and it shows what kind of business this is: staking earned about $2.1 million, running the company cost about $1.9 million, and everything else was the token price moving.
AVAT's first quarter: staking earned $2.1M, overhead cost $1.9M, and a $46.2M mark on the tokens produced a $26.8M loss
Each bar is one line of the Q1 2026 statement of operations for Avalanche Treasury Company, LLC, the operating entity, drawn to one scale from a shared zero: gains run right, losses run left. Ink marks the two operating lines, claret and teal the mark-to-market lines, and the final bar is the filed net loss so the rows can be checked against it. AVAX was carried at $122.8M at quarter-end.
Source: AVAT 424B3, 27 Jul 2026: unaudited pro forma condensed combined statement of operations (Avalanche Treasury Company, LLC historical column) and Note on digital assets, three months ended 31 Mar 2026.
Controls, and a going-concern opinion that changed
“We identified a material weakness in that we did not design and maintain effective controls over the financial reporting process, including segregation of duties related to journal entries and account reconciliations.”— 424B3, risk factors
A material weakness is the accounting term for a gap in controls serious enough that a misstatement might not be caught. Here it is the basic one: the people who book entries are not separated from the people who reconcile them, at a company whose balance sheet is $120 million of tokens. The filing says it is working to fix it and plans to hire; it gives no date. FY2025 audits by CBIZ CPAs P.C. for both the operating LLC and the corporation carry going-concern explanatory paragraphs; MLAC’s auditor was WithumSmith+Brown.
The going-concern conclusion reversed between two filings. The Q1 10-Q (29 Jun 2026) said substantial doubt was not alleviated. Four weeks later this prospectus says “management has concluded that substantial doubt about the Company’s ability to continue as a going concern is alleviated for the twelve-month look-forward period from the date of the filing of this registration statement”, citing the closing of the business combination and the loan proceeds received at closing. The loan that lifted the doubt is the $25 million FalconX facility, secured on the company’s own AVAX at a 200% collateral ratio; the Wallets page prices the level at which that collateral falls short.
The Foundation deal and the closing-day register
$200 million of AVAX, measured before the discount, for $50 million in cash or USDC and up to 3,000,000 Class A shares valued at $30 million: a 60% discount, in the company’s own words. 7,317,965 AVAX received from the Foundation in October and November 2025, for 34.5 million USDC and $15.5 million in cash.
Exclusivity and first refusal
An 18-month exclusivity on Foundation AVAX sales to U.S. digital-asset treasury companies, plus a right of first refusal on certain later discounted sales.
A seat at the table
The Foundation holds the right to designate a board member for a defined period after the closing.
Tokens the company cannot freely sell
AVAX delivered under the token sale agreement carries contractual transfer restrictions on the company for up to five years.
A cap on the seller’s vote
If Class A ever becomes voting, the Foundation can exchange shares for pre-funded warrants so its ownership stays under a stated maximum percentage.
How the vote was bought
Dragonfly contributed 1,960,040 AVAX for 5,805,638 units, which became the voting Class B. Its control was bought with tokens, not cash.
What the bankers took
PJT Partners and Barclays took a 5.5% cash fee on institutional gross proceeds, split equally; a separate $2,750,000 M&A advisory fee was payable at closing. $23.0 million of the 7% FalconX loan was drawn to pay transaction expenses at closing.
Company-unit investors subscribed about $216 million at $10.00 a unit. At the closing the Class A register read as follows, 37,914,826 shares in all. Only 6.5% came from the public side of the SPAC; the rest was the pre-merger LLC, the sponsor, the seller and the insiders.
Governance, in the filing’s own words
“As a controlled company, we are exempt from certain Nasdaq governance requirements … (i) our Board does not have a majority of independent directors, (ii) the compensation of our executive officers is not determined by a majority of the independent directors or a committee of independent directors, and (iii) director nominees are not selected or recommended by independent directors.”— 424B3, summary risk factors
Because Class A is non-voting, the company says significant stockholders are exempt from the reports under Sections 13(d), 13(g) and 16 that would otherwise reveal them; directors and officers still file under Section 16, and holders other than directors, officers and Dragonfly are exempt from short-swing profit recovery. All officers and directors as a group, five people, beneficially own 4,478,011 Class A shares, 10.8%, almost all of it Hadick’s Astral attribution; the CEO holds one share directly, the COO and CFO none.
The company has also written its own answer to the discount into the document: “where the Class A Common Stock trades at a meaningful discount to our estimated mNAV relative to the prevailing AVAX price, we may sell a portion of our AVAX to fund opportunistic share repurchases”. It trades at roughly an eighth of NAV as this is written. The filing says the company may hold or trade commodity futures to hedge its AVAX, and warns the losses on such contracts are potentially unlimited. Authorized capital: 550,000,000 Class A, 100,000,000 Class B and 50,000,000 preferred, all $0.01 par.
The prospectus gives the company’s mailing address as a private mailbox, 413 W 14th Street, Floor 2, PMB 4633, New York 10014; the beneficial-ownership table and every 8-K give 11 W. 42nd Street, 2nd Floor, New York 10036.
Where the document contradicts itself
Small things, recorded because the same pattern runs through the company’s other paper: a resignation letter with its brackets unfilled, a website with “Pending legal review” left in the copy.
- Cover recital The business combination agreement is described as “dated October 1, 2026”. It was signed 1 October 2025, as the rest of the document says.
- Selling-holder footnotes Paul Grinberg and Douglas Horlick each hold 478,010 shares in the table and 478,101 in footnotes (6) and (7).
- Liquid staking “AVAT currently holds stAVAX and sAVAX” appears two paragraphs before “As of July 20, 2026, the Company did not hold sAVAX or stAVAX.”
- Lock-up 180 days (or a $12.50 VWAP) in the lock-up section; the one-year anniversary of closing in the risk factors.
- Addresses A PMB on West 14th Street in one place, an office on West 42nd in another.
Sources
- 424B3 resale prospectus, 27 Jul 2026 (EDGAR)
- 8-K of 16 Jul 2026, Item 5.02: the option grants
- Q1 2026 10-Q, 29 Jun 2026
Read 2026-08-21 from the filing’s full text; every number re-checked against the same text by a second, independent pass. Accession 0001104659-26-087111.