What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-05-03 compared with 2023-11-14 · 24 added, 48 removed, 62 unchanged (54% of the section changed)

15 unchanged sentences

We are a blank check company incorporated in Delaware on May 1, 2023.

We were formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to herein as our “initial business combination.” Our efforts to identify a prospective target business are not limited to any particular industry or geographic region, although we intend to to focus on target businesses in Asia (excluding China, Hong Kong, and Macau) that operate in the financial technology sector.

We were formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to herein as our “initial business combination.” Our efforts to identify a prospective target business are not limited to any particular industry or geographic region, although we intend to focus on target businesses in Asia (excluding China, Hong Kong, and Macau) that operate in the financial technology sector.

We intend to utilize cash derived from the proceeds of our initial public offering (“IPO” as defined below) and the private placement of Private Units, our securities, debt or a combination of cash, securities and debt, in effecting our initial business combination.

3 unchanged sentences

We have neither engaged in any operations nor generated any operating revenues to date.

Our only activities through September 30, 2023 were organizational activities and those necessary to prepare for our IPO, which is described below, and subsequent to the IPO, identifying a target company for an initial business combination.

Our activities from May 1, 2023 (inception) through March 31, 2024 were organizational activities and those necessary to prepare for our IPO, which is described below, and subsequent to the IPO, identifying a target company for an initial business combination.

We do not expect to generate any operating revenues until after the completion of our initial business combination.

1 unchanged sentence

We expect that we will 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 in connection with searching for, and completing, a Business Combination.

For the three months ended September 30, 2023 and for the period from May 1, 2023 (inception) through September 30, 2023, we had a net income of $2,949 and $3,686, respectively, all of which consisted of interest income.

For the three months ended March 31, 2024, we had net income of $611,704, which consisted of formation and operational costs of $77,029, related party administrative fees of $30,000, franchise tax expense of $16,200 and income tax expense of $191,056, offset by interest income of $925,989.

Liquidity and Capital Resources

15 unchanged sentences

Such funds could also be used to repay any operating expenses or finders’ fees which we had incurred prior to the completion of our initial business combination if the funds available to us outside of the Trust Account were insufficient to cover such expenses.

As of September 30, 2023, the Company had cash of $262,658 and a working capital deficit (current assets less current liabilities, excluding deferred offering costs) of $122,602.

Upon the closing of IPO on October 11, 2023, we had cash of $774,668 not held in the Trust Account and a working capital of $767,721.

As of March 31, 2024, the Company had cash of $565,813 and a working capital (current assets less current liabilities) of $178,404.

The Company has incurred and expects to continue to incur significant professional costs to remain as a publicly traded company and to incur significant transaction costs in pursuit of the consummation of a Business Combination.

5 unchanged sentences

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of September 30, 2023.

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2024.

We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.

1 unchanged sentence

Contractual Obligations

Due to Related Party

Prior to the inception of the Company, the Sponsor formed a blank check company (which was dissolved in April 2023) and paid professional fees totaling $85,000 in 2022 for transaction costs related to its public offering.

The service providers credited a total of $85,000 to the transaction costs incurred in connection with the Proposed Public Offering of the Company.

As of September 30, 2023, $85,000 was outstanding;

the amount is unsecured, interest-free and due on demand.

The Company repaid the outstanding balance of $85,000 to the Sponsor on October 11, 2023 .

Promissory Notes – Related Party

On May 21, 2023, the Sponsor agreed to loan the Company up to an aggregate amount of $300,000 to be used, in part, for transaction costs incurred in connection with the Proposed Public Offering (the “Promissory Note”).

The Promissory Note is unsecured, interest-free and due after the date on which the Company closes the initial Business Combination.

As of September 30, 2023, $300,000 was outstanding under the Promissory Note.

The Company repaid the outstanding balance of $300,000 to the Sponsor on October 11, 2023.

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than described below.

Administrative Services Agreement

2 unchanged sentences

Any such unpaid amount will accrue without interest and be due and payable no later than the date of the consummation of the initial Business Combination.

For the three months ended March 31, 2024, the Company has incurred $30,000 in related party fees for the services provided by the Sponsor under this agreement.

Underwriting Agreement

Pursuant to an underwriting agreement in connection with the IPO, we granted EF Hutton, the representative of the underwriters, a 45-day option to purchase up to 900,000 additional Units to cover over-allotments, if any, at the IPO price less the underwriting discounts and commissions.

On October 11, 2023, the underwriters fully exercised the over-allotment option to purchase 900,000 units at an offering price of $10.00 per Unit for an aggregate purchase price of $9,000,000.

The underwriters were paid a cash underwriting discount of 2.0% of the gross proceeds of the IPO, or $1,380,000.

In addition, the underwriters are entitled to a deferred fee of 3.5% of the gross proceeds of the IPO, or $2,415,000, which will be paid upon the closing of a Business Combination from the amounts held in the Trust Account, subject to the terms of the underwriting agreement.

The underwriters reimbursed $690,000 to the Company for the IPO related expenses.

Upon closing of a Business Combination, the underwriters will be entitled to a deferred fee of 3.5% of the gross proceeds of the IPO, or $2,415,000.

The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that we complete a Business Combination, subject to the terms of the underwriting agreement.

Additionally, we issued the underwriters 69,000 shares common stock, or the representative shares, at the closing of the IPO as part of representative compensation.

Critical Accounting Policies

The preparation of unaudited financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the unaudited financial statements, and income and expenses during the periods reported.

Critical Accounting Policies and Estimates

The preparation of unaudited financial

statements and related disclosures in conformity with accounting principles generally accepted in the United States of America

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of

contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported.

Actual results could materially differ from those estimates.

We have identified the following critical accounting policies:

Common Stock Subject to Possible Redemption

We account for our common stock subject to possible conversion in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value.

Conditionally redeemable common stock (including common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity.

At all other times, common stock is classified as stockholders’ equity.

The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events.

If it is probable that the equity instrument will become redeemable, we have the option to either (i) accrete changes in the redemption value over the period from the date of issuance (or from the date that it becomes probable that the instrument will become redeemable, if later) to the earliest redemption date of the instrument or (ii) recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting period.

The Company has elected to recognize the changes immediately.

The accretion or remeasurement will be treated as a deemed dividend (i.e., a reduction to retained earnings, or in absence of retained earnings, additional paid-in capital).

Net Income (Loss) Per Share

Net income (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture by the Initial Stockholders.

Weighted average shares were reduced for the effect of an aggregate of 225,000 shares of common stock that are subject to forfeiture if the over-allotment option is not exercised in full by the underwriters.

As of September 30, 2023, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into shares of common stock and then share in the earnings of the Company.

As a result, diluted loss per share is the same as basic loss per share for the period presented.

Deferred Offering Costs

Deferred offering costs consist of legal, underwriting fees and other costs incurred through the balance sheet date that are directly related to the Proposed Public Offering and that will be charged to stockholders’ equity upon the completion of the Proposed Public Offering.

Should the Proposed Public Offering prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations.

We have not identified any critical accounting policies and estimates.

Recent accounting pronouncements

In August 2020, the FASB issued Accounting Standards Update (“ASU”) No.

2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP.

The ASU also removes certain settlement conditions that are required for equity-linked contracts to qualify for the derivative scope exception, and it simplifies the diluted earnings per share calculation in certain areas.

ASU 2020-06 is effective January 1, 2024 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021.

The Company adopted ASU 2020-06 from the Company’s inception.

Adoption of the ASU did not impact the Company’s financial position, results of operations or cash flows.

In December 2023, the FASB issued Accounting Standards

Update 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosure” (“ASU 2023-09”).

mostly requires, on an annual basis, disclosure of specific categories in an entity’s effective tax rate reconciliation and income

taxes paid disaggregated by jurisdiction.

The incremental disclosures may be presented on a prospective or retrospective basis.

is effective for fiscal years beginning after December 15, 2024 with early adoption permitted.

The Company is currently assessing the

impact, if any, that ASU 2023-09 would have on its financial position, results of operations or cash flows.

Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis