Filed 2026-03-31 · Period ending 2025-12-31 · 67,941 words · SEC EDGAR
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# Plum Acquisition Corp, IV (PLMK) — 10-K
**Filed:** 2026-03-31
**Period ending:** 2025-12-31
**Accession:** 0001213900-26-036962
**Source:** [SEC EDGAR](https://www.sec.gov/Archives/edgar/data/2030482/000121390026036962/)
**Origin leaf:** a71ae5500c86333206d8d2fd78c9be2e4d417a92bfb2f86bacbfab14439e95ce
**Words:** 67,941
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2025
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 001-42472
PLUM ACQUISITION CORP. IV
(Exact name of registrant as specified in its
charter)
| Cayman Islands | | 98-1795710 | |
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(State or other jurisdiction of
incorporation or organization) |
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(I.R.S. Employer
Identification Number) | |
2021 Fillmore St. #2089
San Francisco, California 94115
(Address of principal executive offices)
(Zip Code)
(929) 529-7125
(Registrants telephone number, including
area code)
Securities registered pursuant to Section 12(b)
of the Exchange Act:
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Title of Each Class |
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Trading Symbol (s) |
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Name of Each Exchange on Which Registered | |
| Class A ordinary shares, $0.0001 par value per share | | PLMK | | The Nasdaq Stock Market LLC | |
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| Warrants to purchase one share of Class A ordinary shares | | PLMKW | | The Nasdaq Stock Market LLC | |
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| Units, each consisting of one share of Class A ordinary shares and one-half of one redeemable warrant | | PLMKU | | The Nasdaq Stock Market LLC | |
Securities registered pursuant to Section 12(g)
of the Exchange Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes No
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No
Indicate by check mark whether
the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging
growth company. See definitions of large accelerated filer, accelerated filer, smaller reporting company
and emerging growth company in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | Accelerated filer | Non-accelerated filer | Smaller reporting company Emerging growth company | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether
any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the
registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No
As of June 30, 2025, the aggregate market value of the Class A ordinary shares, par value $0.0001 per share, of the registrant held by non-affiliates of the registrant was $177,330,000 based on the $10.28 closing sale price of the Registrants Class A ordinary shares on such date.
As of March 31, 2026, there were 18,492,875 Class A ordinary shares, par value $0.0001 per share, and 5,750,000 Class B ordinary shares, par value $0.0001 per share, issued and outstanding.
TABLE OF CONTENTS
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PART I |
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Item 1. |
Business |
1 | |
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Item 1A. |
Risk Factors |
7 | |
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Item 1B. |
Unresolved Staff Comments |
43 | |
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Item 1C. |
Cybersecurity |
43 | |
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Item 2. |
Properties |
43 | |
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Item 3. |
Legal Proceedings |
43 | |
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Item 4. |
Mine Safety Disclosures |
43 | |
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PART II |
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Item 5. |
Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
44 | |
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Item 6. |
[Reserved] |
44 | |
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Item 7. |
Managements Discussion and Analysis of Financial Condition and Results of Operations |
45 | |
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Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk |
48 | |
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Item 8. |
Financial Statements and Supplementary Data |
48 | |
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Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
49 | |
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Item 9A. |
Controls and Procedures |
49 | |
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Item 9B. |
Other Information |
49 | |
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Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
49 | |
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PART III |
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Item 10. |
Directors, Executive Officers and Corporate Governance |
50 | |
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Item 11. |
Executive Compensation |
55 | |
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Item 12. |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
56 | |
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Item 13. |
Certain Relationships and Related Transactions, and Director Independence |
57 | |
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Item 14. |
Principal Accountant Fees and Services |
60 | |
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PART IV |
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Item 15. |
Exhibits and Financial Statement Schedules |
61 | |
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Item 16. |
Form 10-K Summary |
62 | |
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SIGNATURES |
63 | |
i
CERTAIN TERMS
Unless otherwise stated in this Annual Report on Form 10-K (Annual
Report) or unless the context otherwise requires, references to:
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| amended and restated memorandum
and articles of association are to our amended and restated memorandum and articles of association in effect as of the date hereof; |
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| Cohen are to Cohen
& Company Capital Markets, a division of Cohen & Company Securities, LLC, a representative of the underwriters in the initial
public offering; |
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| Companies Act are
to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; |
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| directors are to
our directors named in this Annual Report; |
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| founder shares are
to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to the initial public offering, an aggregate
of 100,000 of which were transferred to our four independent directors, and our Class A ordinary shares that will be issued upon conversion
thereof; |
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| initial shareholders
are to sponsor and our four independent directors that held our founder shares prior or shortly after the initial public offering; |
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| initial public offering
are to our initial public offering, which was consummated on January 16, 2025. |
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| management or our
management team are to our directors and officers; |
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| non-managing investors
are to certain institutional investors (none of which are affiliated with any member of our management or any other investor) that purchased
through investments in our sponsor, an aggregate of 285,000 private placement units and 570,000 restricted private placement shares at
a combined price of $10.00 per non-managing investor private placement security ($2,850,000 in the aggregate). Our sponsor issued membership
interests at a nominal purchase price to the non-managing investors at the closing of our initial public offering reflecting interests
in an aggregate of 2,280,000 founder shares held by our sponsor; |
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| non-managing investor private
placement securities are to the private placement units and restricted private placement shares, collectively, purchased by the
non-managing investors through the sponsor; |
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| ordinary shares
are to our Class A ordinary shares and our Class B ordinary shares; |
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| private placement shares
are to the Class A ordinary shares sold as part of the private placement units; |
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| private placement units
are to the units issued to our sponsor and the underwriters in private placements simultaneously with the closing of the initial public
offering, which private placement units are identical to the units sold in the initial public offering, subject to certain limited exceptions
as described in this Annual Report; |
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| private placement securities
are to the private placement units and the non-managing investor private placement securities, collectively; |
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| private placement warrants
are to the warrants sold as part of the private placement units; |
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| public shareholders
are to the holders of our public shares, including our sponsor, any non-managing investors, directors and officers to the extent such
persons purchase public shares, provided their status as a public shareholder shall only exist with respect to such public
shares; |
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| public shares are
to our Class A ordinary shares sold as part of the units in the initial public offering (whether they were purchased in the initial public
offering or thereafter in the open market); |
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| public warrants
are to our warrants sold as part of the units in the initial public offering (whether they were purchased in the initial public offering
or thereafter in the open market); |
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| restricted private placement
shares are to 570,000 restricted Class A ordinary shares purchased by the non-managing investors through our sponsor, which shares
would be transferred to the non-managing investors only upon consummation of an initial business combination; |
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| Seaport are to Seaport
Global Securities LLC, a representative of the underwriters in the initial public offering ; |
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| sponsor are to Plum
Partners IV, LLC, a Delaware limited liability company; |
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| underwriters are,
collectively, to Cohen and Seaport; |
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| warrants are, collectively,
to the public warrants and the private placement warrants; |
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| warrant agreement
are, together, to our warrant agreement governing the warrants; |
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| we, us,
our or our company are to Plum Acquisition Corp. IV, a Cayman Islands exempted company; and |
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| $, US$
and U.S. dollar each refer to the United States dollar. |
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ii
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Some statements contained in this Annual Report
are forward-looking in nature. Our forward-looking statements and risk factors include, but are not limited to, statements and risk factors
regarding our or our management teams expectations, hopes, beliefs, intentions or strategies regarding the future. In addition,
any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying
assumptions, are forward-looking statements. The words anticipate, believe, continue, could,
estimate, expect, intends, may, might, plan, possible,
potential, predict, project, should, would and similar expressions
may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking
statements and risk factors in this Annual Report may include, for example, statements and risk factors about:
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our ability to select an appropriate target business or businesses; | |
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our ability to complete our initial business combination with Controlled Thermal Resources Holdings Inc. (CTR), which is impacted by various factors; | |
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our expectations around the performance of CTR or any other prospective target business or businesses or of markets or industries; | |
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our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; | |
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our directors and officers allocating their time to other businesses and potentially having conflicts of interest with or otherwise conflicting contractual obligations in connection with our business or in approving or consummating our initial business combination; | |
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our potential ability to obtain additional financing to complete our initial business combination; | |
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our pool of prospective target businesses if the proposed business combination with CTR is not completed; | |
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the ability of our directors and officers to generate a number of potential business combination opportunities; | |
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the potential liquidity and trading of our public securities; | |
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the lack of a market for our securities; | |
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the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; | |
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Macro-economic turbulence and instability relating to recent and ongoing global conflicts and other drivers of uncertainty may adversely affect our business, investments and results of operations and our ability to successfully consummate a business combination; | |
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the trust account not being subject to claims of third parties; | |
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our financial performance following the initial public offering; or | |
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the other risk and uncertainties discussed in Item 1A. Risk Factors, elsewhere in this Annual Report and in our other filings with the SEC, including in our preliminary prospectus/proxy statement included in a Registration Statement on Form S-4 that we intend to file with the SEC, relating to the proposed business combination with CTR (the S-4 Registration Statement). | |
The forward-looking statements and risk factors
contained in this report are based on our current expectations and beliefs concerning future developments and their potential effects
on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements
involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or
performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties
include, but are not limited to, those factors described under the heading Risk Factors. Should one or more of these risks
or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those
projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
iii
PART I
ITEM 1. BUSINESS
General
We are a blank check company, incorporated as
a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization
or similar business combination with one or more businesses.
Our efforts to identify a prospective initial
business combination target will not be limited to a particular industry, sector or geographic region. While we may pursue an initial
business combination opportunity in any industry or sector, we intend to capitalize on the ability of our management team to identify,
acquire and operate a business or businesses that can benefit from our management teams established global relationships, sector
expertise and active management and operating experience.
On June 26, 2024, our sponsor paid $25,000, or
approximately $0.003 per share, to cover certain of our offering and formation costs in exchange for an aggregate of 7,665,900 Class B
ordinary shares. During July and August 2024, our sponsor transferred 25,000 founder shares to each of three independent directors (an
aggregate of 75,000 founder shares) at their original purchase price. On December 6, 2024, our sponsor surrendered 1,915,900 founder shares
for no consideration. On April 25, 2025, our sponsor transferred 25,000 founder shares to our fourth independent director. Our initial
shareholders currently hold an aggregate of 5,750,000 founder shares.
Subject to each non-managing investor purchasing,
through an investment in our sponsor, the non-managing investor private placement securities allocated to it in connection with the closing
of the initial public offering, our sponsor issued membership interests at a nominal purchase price to the non-managing investors reflecting
interests in an aggregate of 2,280,000 founder shares held by our sponsor.
Prior to the initial investment in the company
of $25,000 by our sponsor, we had no assets, tangible or intangible. The purchase price of these founder shares was determined by dividing
the amount of cash contributed to us by the number of founder shares issued.
On January 16, 2025, we consummated the initial
public offering of 17,250,000 units, which included the full exercise of the underwriters over-allotment option. Each unit consists
of one Class A ordinary share and one-half of one redeemable public warrant, each whole public warrant entitling the holder thereof to
purchase one Class A ordinary share at an exercise price of $11.50 per share, subject to adjustment. The units were sold at an offering
price of $10.00 per unit, generating gross proceeds of $172,500,000 (before underwriting discounts and commissions and offering expenses).
Simultaneously with the consummation of the initial
public offering and the issuance and sale of the units, on January 16, 2025, we consummated the private placement of an aggregate of 672,875
private placement units and 570,000 restricted private placement shares at a price of $10.00 per private placement unit or $10.00 per
non-managing investor private placement security, as applicable, generating gross proceeds of $6,728,750, as follows: (A) 440,000 private
placement units and 570,000 restricted private placement shares ($4,400,000 in the aggregate) with the sponsor, (B) 186,300 private placement
units ($1,863,000 in the aggregate) with Cohen and (C) 46,575 private placement units ($465,750 in the aggregate) with Seaport (collectively,
the private placement). The private placement units, which were purchased by the sponsor, Cohen and Seaport, are identical
to the units, except that, they (including the underlying securities) are (i) subject to certain limited exceptions, subject to transfer
restrictions until 180 days following the consummation of our initial business combination and (ii) entitled to registration rights. The
restricted private placement shares are held by the sponsor and will be transferred to the non-managing investors (or their designees)
only upon the consummation of an initial business combination. Other than such permitted transfer, the restricted private placement shares
are (i) subject to transfer restrictions until 90 days following the consummation of our initial business combination and (ii) entitled
to registration rights.
A total of $174,225,000 of the net proceeds from
the initial public offering and the private placement (which includes the underwriters deferred discount of up to $6,900,000) was
placed in a trust account, with Continental Stock Transfer & Trust Company acting as trustee.
1
Proposed Business Combination
**
*Business Combination Agreement*
On March 8, 2026, we entered into a business combination
agreement (the Business Combination Agreement) by and among us, Plum IV Merger Sub, Inc., a Delaware corporation and our
direct wholly owned subsidiary (Merger Sub), and Controlled Thermal Resources Holdings Inc., a Delaware corporation (CTR),
pursuant to which, among other things and subject to the terms and conditions contained therein, Merger Sub will merge with and into CTR
(the Merger), with CTR continuing as the surviving company. The transactions contemplated by the Business Combination Agreement
are referred to in this Annual Report as the Business Combination. The combined companys business is expected to
continue to operate through CTR. The proposed Merger is expected to be consummated after receipt of the required approvals by our shareholders
and CTRs stockholders and the satisfaction or waiver of certain other customary conditions.
Domestication
At least two (2) business days prior to the Closing
Date (as defined in the Business Combination Agreement), subject to the satisfaction or waiver of the conditions of the Business Combination
Agreement, the Company will transfer by way of continuation from the Cayman Islands to the State of Delaware and domesticate as a Delaware
corporation (Domesticated Plum IV) in accordance with Section 388 of the General Corporation Law of the State of Delaware,
as amended, and Part 12 of the Companies Act (as revised) of the Cayman Islands (such continuation and domestication, the Domestication).
By virtue of the Domestication upon its effectiveness, (a) each then
issued and outstanding Class A ordinary share, par value $0.0001 per share, of the Company (each a Class A Ordinary Share)
(other than any Class A Ordinary Share included in the Cayman Purchaser Units (as defined in the Business Combination Agreement)) shall
convert automatically, on a one-for-one basis, into one (1) share of common stock of Domesticated Plum IV (the Domesticated Purchaser
Common Stock); (b) each then issued and outstanding Class B ordinary share, par value $0.0001 per share, of the Company (each a
Class B Ordinary Share) shall convert automatically, on a one-for-one basis, into one (1) share of Class B common stock
of Domesticated Plum IV (the Domesticated Purchaser Class B Common Stock); (c) each then issued and outstanding warrant
of the Company (other than any Cayman Purchaser Public Warrants (as defined in the Business Combination Agreement)) included in the Cayman
Purchaser Units) (each a Cayman Purchaser Warrant) shall convert automatically into a warrant to acquire one (1) share of
Domesticated Purchaser Common Stock (each a Domesticated Purchaser Warrant), pursuant to the Warrant Agreement (as defined
in the Business Combination Agreement); and (d) each then issued and outstanding Cayman Purchaser Unit shall be cancelled and will thereafter
entitle the holder thereof to one (1) share of Domesticated Purchaser Common Stock and one-half of one (1) Domesticated Purchaser Warrant,
in each case without any action on the part of the Company, Merger Sub, the Company or any holder of securities of any of the foregoing.
The Merger and Consideration
Following the Domestication, at the Effective
Time (as defined in the Business Combination Agreement), by virtue of the Merger, each share of capital stock of Merger Sub issued and
outstanding immediately prior to the Effective Time shall be automatically cancelled and extinguished and converted into one (1) share
of common stock, par value $0.0001 per share, of the surviving company.
Subject to, and in accordance with the terms and conditions of the
Business Combination Agreement, at the Effective Time (as defined in the Business Combination Agreement):
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(i) | each share of common stock of CTR (the CTR Common
Stock) issued and outstanding (or deemed to be issued and outstanding under the terms of the Business Combination Agreement) immediately
prior to the Effective Time, except for (a) shares held by the Company or Merger Sub (or any subsidiaries of the Company), (b) shares
held by the CTR as treasury stock, if any (each share covered in subclause (a) and (b), an Excluded Share), (c) shares
held by stockholders who have properly exercised and not withdrawn appraisal rights under Delaware law (the Dissenting Shares),
and (d) shares of CTR Common Stock issued pursuant to an award of restricted stock that is, as of immediately prior to the Closing Date
(as defined in the Business Combination Agreement), subject to a substantial risk of forfeiture and is not transferable (the CTR
Restricted Shares), will be cancelled and converted into the right to receive the Per Share Merger Consideration (as defined in
the Business Combination Agreement); |
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(ii) | each Excluded Share shall be automatically cancelled and
retired without any conversion thereof and shall cease to exist, and no consideration shall be delivered in exchange therefor; |
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(iii) | each option to purchase shares of the CTR Common Stock (the
CTR Option) that is outstanding immediately prior to the Effective Time will be automatically assumed by Domesticated Plum
IV and converted into an option to purchase a number of shares of Domesticated Purchaser Common Stock equal to the product (rounded down
to the nearest whole number) of (x) the number of shares of CTR Common Stock subject to such CTR Option immediately prior to the Effective
Time and (y) the Exchange Ratio (as defined in the Business Combination Agreement), at an exercise price per share (rounded up to the
nearest whole cent) equal to the quotient of (A) the exercise price per share of such CTR Option immediately prior to the Effective Time
divided by (B) the Exchange Ratio; |
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(iv) | each award of the CTR Restricted Shares (the CTR Restricted
Share Award) that is outstanding immediately prior to the Effective Time will be automatically assumed by Domesticated Plum IV
such that each CTR Restricted Share Award will be converted into an award for a number of restricted shares of Domesticated Purchaser
Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of CTR Restricted Shares and
(y) the Exchange Ratio; and |
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(v) | each warrant to purchase shares of the CTR Common Stock (the
CTR Warrant) that is outstanding immediately prior to the Effective Time will be automatically assumed by the Domesticated
Plum IV such that, as of the Effective Time, each CTR Warrant shall instead be converted into a warrant to purchase a number of shares
of Domesticated Purchaser Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of
CTR Common Stock issuable upon exercise of such CTR Warrant and (y) the Exchange Ratio, at an exercise price per share (rounded up to
the nearest whole cent) equal to the quotient of (A) the exercise price per share of such CTR Warrant immediately prior to the Effective
Time divided by (B) the Exchange Ratio. |
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The Class B Conversion
At the Effective Time, by virtue of the Merger and the applicable provisions
of the certificate of incorporation of Domesticated Plum IV (the Domesticated Purchaser Charter), each share of Domesticated
Purchaser Class B Common Stock then issued and outstanding shall be automatically cancelled and extinguished and converted into one (1)
share of Domesticated Purchaser Common Stock.
*Transaction Support
Agreement*
Simultaneously with the
execution and delivery of the Business Combination Agreement, we and certain stockholders of CTR, who collectively have the right to cast
at least 60% of the votes entitled to be cast at a special meeting of CTRs stockholders (collectively, the Supporting CTR
Stockholders) entered into a transaction support agreement (the Transaction Support Agreement), pursuant to which
the Supporting CTR Stockholders have agreed, among other things, to vote all of their shares of CTRs common stock in favor of adopting
and approving the Business Combination Agreement and the Business Combination.
*Registration Rights
Agreement*
In connection with the
Business Combination, simultaneously with the closing of the Business Combination (the Closing), we and certain holders
will enter into an amended and restated registration rights agreement (the Amended and Restated Registration Rights Agreement)
that amends and restates the Registration Rights Agreement, dated January 14, 2025, by and among us, our sponsor and certain other security
holders named therein, pursuant to which, among other things, (i) we will agree to file, as soon as practicable (and in any event within
thirty (30) calendar days) following the closing date, a registration statement covering the resale of certain equity securities held
by the sponsor and such other securityholders parties thereto; and (ii) such holders of registrable securities will be granted certain
takedown, demand, block trade and piggyback registration rights with respect to their registrable securities, in each case, on the terms
and subject to the conditions set forth in the Amended and Restated Registration Rights Agreement.
*Lock-Up Agreement*
In connection with the
Business Combination, simultaneously with the closing, we, our sponsor and certain stockholders of CTR (such holders, collectively, the
Lock-Up Parties) will enter into a Lock-Up Agreement (the Lock-Up Agreement). The Lock-Up Agreement will provide
that, during the applicable Lock-Up Period (as defined in the Lock-Up Agreement), subject to certain exceptions, the Lock-Up Parties will
not, with respect to the Lock-Up Securities (as defined in the Lock-Up Agreement), (i) sell, offer to sell, contract or agree to sell,
hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish
or increase a put equivalent position or liquidation with respect to or decrease a call equivalent position, (ii) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether
any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii) publicly announce the intention to
effect any transaction specified in clause (i) or (ii).
3
Selection of a Target Business and Structuring
of our Initial Business Combination
Nasdaq listing rules require that our initial
business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets
held in the trust account (excluding any deferred underwriters fees and taxes payable on the income earned on the trust account).
We refer to this as the 80% fair market value test. The fair market value of the target or targets will be determined by our board of
directors based upon one or more standards generally accepted by the financial community, such as discounted cash flow valuation or value
of comparable businesses. If our board of directors is not able independently to determine the fair market value of the target business
or businesses, we will obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders
valuation opinions, with respect to the satisfaction of such criteria. We do not currently intend to purchase multiple businesses in unrelated
industries in conjunction with our initial business combination, although there is no assurance that will be the case. Subject to this
requirement, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective target businesses,
although we will not be permitted to effectuate our initial business combination solely with another blank check company or a similar
company with nominal operations.
In any case, we will only complete an initial
business combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the
target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment
company under the Investment Company Act. If less than 100% of the equity interests or assets of a target business or businesses are owned
or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued
for purposes of the 80% fair market value test. There is no basis for investors in the initial public offering to evaluate the possible
merits or risks of any target business with which we may ultimately complete our initial business combination.
To the extent we effect our initial business combination
with a company or business that may be financially unstable or in its early stages of development or growth we may be affected by numerous
risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target
business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
In evaluating a prospective target business, we
expect to conduct a thorough due diligence review which may encompass, among other things, meetings with incumbent management and employees,
document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information, which will be
made available to us.
The time required to select and evaluate a target
business and to structure and complete our initial business combination, and the costs associated with this process, are not currently
ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target
business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the
funds we can use to complete another business combination.
Redemption Rights for Public Shareholders Upon
Completion of our Initial Business Combination
We will provide our public shareholders with the
opportunity to redeem, regardless of whether they abstain, vote for, or against, our initial business combination, all or a portion of
their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate
amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination,
including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares,
subject to the limitations described herein. At the completion of our initial business combination, we will be required to purchase any
ordinary shares properly delivered for redemption and not withdrawn. The amount in the trust account is initially anticipated to be $10.10
per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred
underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder
must identify itself in order to validly redeem its public shares. There will be no redemption rights upon the completion of our initial
business combination with respect to our public warrants. Our initial shareholders, directors and officers have entered into a letter
agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares
held by them in connection with the completion of our initial business combination. The non-managing investors are not required to (i)
hold any units, Class A ordinary shares or public warrants they may purchase in the initial public offering or thereafter for any amount
of time, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii)
refrain from exercising their right to redeem their public shares at the time of our initial business combination. The non-managing investors
will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they
may purchase in the initial public offering as the rights afforded to our other public shareholders.
4
Limitation on Redemption Upon Completion of
our Initial Business Combination If we Seek Shareholder Approval
Notwithstanding the foregoing redemption rights,
if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public
shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as
a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to
Excess Shares, without our prior consent. We believe this restriction will discourage shareholders from accumulating large blocks of shares,
and subsequent attempts by such holders to use their ability to exercise their redemption rights against a proposed business combination
as a means to force us, our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price
or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in
the initial public offering could threaten to exercise its redemption rights if such holders shares are not purchased by us, our
sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders
ability to redeem no more than 15% of the shares sold in the initial public offering, we believe we will limit the ability of a small
group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection
with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of
cash. However, we would not be restricting our shareholders ability to vote all of their shares (including Excess Shares) for or
against our initial business combination.
Redemption of Public Shares and Liquidation
if No Initial Business Combination
Our sponsor, our directors and officers have agreed
that we will have only until July 16, 2026 or until such earlier liquidation date as our board of directors may approve to complete our
initial business combination, or during any Extension Period, subject to applicable law. If we have not completed our initial business
combination by July 16, 2026, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible
but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate
amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be
net of taxes payable and up to $100,000 of interest to pay dissolution expenses) and not previously released to us to pay our taxes, if
any, divided by the number of then-outstanding public shares, which redemption will completely extinguish public shareholders rights
as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (3) as promptly
as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate
and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements
of other applicable law. There will be no redemption rights or liquidating distributions with respect to our public warrants, which will
expire worthless if we fail to complete our initial business combination by July 16, 2026.
Competition
We have encountered and, if the business combination
with CTR is not completed, may in the future encounter intense competition from other entities having a business objective similar to
ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities,
domestic and international, competing for the types of businesses we intend to acquire. Many of these individuals and entities are well
established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in
or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more local
industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors.
While we believe there are numerous target businesses we could potentially acquire with the net proceeds of the initial public offering
and, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available
financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses.
Furthermore, in the event we seek shareholder approval of our initial business combination and we are obligated to pay cash for our Class
A ordinary shares, it will potentially reduce the resources available to us for our initial business combination. Any of these obligations
may place us at a competitive disadvantage in successfully negotiating a business combination.
Employees
We currently have two officers and do not intend
to have any full-time employees prior to the completion of our initial business combination. Members of our management team are not obligated
to devote any specific number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs
until we have completed our initial business combination. The amount of time that any such person will devote in any time period will
vary based on whether a target business has been selected for our initial business combination and the current stage of the business combination
process.
5
Periodic Reporting and Financial Information
We have registered our units, Class A ordinary
shares and public warrants under the Exchange Act and have reporting obligations, including the requirement that we file annual, quarterly
and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual reports will contain financial statements
audited and reported on by our independent registered public accounting firm.
We will provide shareholders with audited financial
statements of the prospective target business as part of the tender offer materials or proxy solicitation materials sent to shareholders
to assist them in assessing the target business. These financial statements may be required to be prepared in accordance with, or be reconciled
to, U.S. GAAP or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance
with PCAOB standards. These financial statement requirements may limit the pool of potential target businesses we may acquire because
some targets may be unable to provide such financial statements in time for us to disclose such financial statements in accordance with
federal proxy rules and complete our initial business combination within the prescribed time frame. While this may limit the pool of potential
business combination candidates, we do not believe that this limitation will be material.
We are required to evaluate our internal control
procedures for the fiscal year ending December 31, 2025 as required by the Sarbanes-Oxley Act. Only in the event we are deemed to be a
large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with
the independent registered public accounting firm attestation requirement on our internal control over financial reporting. A target business
may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal controls. The development
of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary
to complete any such acquisition.
We filed a Registration Statement on Form 8-A
with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we are subject to the rules and
regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations
under the Exchange Act prior or subsequent to the consummation of our initial business combination.
We are an emerging growth company,
as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain exemptions
from various reporting requirements that are applicable to other public companies that are not emerging growth companies
including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from
the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments
not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market
for our securities and the prices of our securities may be more volatile.
In addition, Section 107 of the JOBS Act also
provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B)
of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company
can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to
take advantage of the benefits of this extended transition period.
We will remain an emerging growth company until
the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of the initial public offering,
(b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer,
which means the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the end of that years
second fiscal quarter, and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the
prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS
Act.
Additionally, we are a smaller reporting
company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure
obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting
company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates equals or exceeds
$250 million as of the end of that years second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during
such completed fiscal year and the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the
end of that years second fiscal quarter.
6
ITEM 1A. RISK FACTORS
Summary of Risk Factors
**
*An investment in our securities involves a
high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in
this Annual Report, before making a decision to invest in our units. If any of the following events occur, our business, financial condition
and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you
could lose all or part of your investment. Such risks include, but are not limited to*:
|
| We have no operating history and
no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. |
|
|
| Our public shareholders may not
be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination
even though a majority of our public shareholders do not support such a combination. |
|
|
| If we seek shareholder approval
of our initial business combination, our initial shareholders, directors and officers have agreed to vote in favor of such initial business
combination, regardless of how our public shareholders vote. |
|
|
| Your only opportunity to affect
the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares
from us for cash, unless we seek shareholder approval of such business combination. |
|
|
| The ability of our public shareholders
to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make
it difficult for us to enter into a business combination with a target. |
|
|
| The ability of our public shareholders
to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination
or optimize our capital structure. |
|
|
| The ability of our public shareholders
to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination
would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. |
|
|
| The requirement that we complete
our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating
a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in
particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on
terms that would produce value for our shareholders. |
|
|
| We may not be able to complete
our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose
of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may receive only $10.10 per
share, or less than such amount in certain circumstances, and our warrants will expire worthless. |
|
|
| Our search for an initial business
combination, and any target business with which we may ultimately consummate an initial business combination, may be materially adversely
affected by current global geopolitical conditions. |
|
7
|
|
|
Military or other conflicts in Ukraine, the Middle East or elsewhere may lead to increased volume and price volatility for publicly traded securities, or affect the operations or financial condition of potential target companies, which could make it more difficult for us to consummate an initial business combination. | |
|
|
|
Recent increases in inflation in the United States and elsewhere could make it more difficult for us to consummate a business combination. | |
|
|
|
Macro-economic turbulence and instability relating to recent and ongoing global conflicts and other drivers of uncertainty may adversely affect our business, investments and results of operations and our ability to successfully consummate a business combination. | |
|
|
|
We may not be able to complete an initial business combination since such initial business combination may be subject to regulatory review and approval requirement, including foreign investment regulations and review by government entities such as the Committee on Foreign Investment in the United States (CFIUS), or may be ultimately prohibited. | |
|
|
|
Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we have not completed our initial business combination within the required time period, our public shareholders may receive only approximately $10.10 per share, or less in certain circumstances, on our redemption of their shares, and our warrants will expire worthless | |
|
|
|
If the funds not being held in the trust account are insufficient to allow us to operate for at least the 18 months following the closing of the initial public offering, we may be unable to complete our initial business combination. | |
|
|
|
Subsequent to our completion of our initial business combination, we may be required to subsequently take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and the price of our securities, which could cause you to lose some or all of your investment. | |
|
|
|
If, after we distribute the proceeds in the trust account to our public shareholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages. | |
|
|
|
If, before distributing the proceeds in the trust account to our public shareholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be reduced. | |
|
|
|
Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults or non-performance by financial institutions, could adversely affect our business, financial condition or results of operations, or our prospects. | |
8
*For
risk factors related to CTR and our proposed Business Combination, please review the S-4 Registration Statement, including our preliminary
proxy statement/prospectus to be included therein, and the definitive proxy statement/prospectus to be filed by us.*
Risks Relating to our Search for, Consummation
of, or Inability to Consummate, a Business Combination and Post-Business Combination Risks
**
*We have no operating history and no revenues,
and you have no basis on which to evaluate our ability to achieve our business objective.*
We are an exempted company incorporated under
the laws of the Cayman Islands with no operating results. Because we lack an operating history to date, you have no basis upon which to
evaluate our ability to achieve our business objective of completing our initial business combination with one or more target businesses.
We may be unable to complete our initial business combination, including the proposed Business Combination with CTR. If we fail to complete
our initial business combination, we will never generate any operating revenues.
**
*Our public shareholders may not be afforded
an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though
a majority of our public shareholders do not support such a combination.*
We may not hold a shareholder vote to approve
our initial business combination unless the business combination would require shareholder approval under applicable law or stock exchange
rules or if we decide to hold a shareholder vote for business or other reasons. For instance, Nasdaq listing rules currently allow us
to engage in a tender offer in lieu of a general meeting, but would still require us to obtain shareholder approval if we were seeking
to issue more than 20% of our issued and outstanding shares to a target business as consideration in any business combination. Therefore,
if we were structuring a business combination that required us to issue more than 20% of our issued and outstanding shares, we would seek
shareholder approval of such business combination. However, except as required by applicable law or stock exchange rules, the decision
as to whether we will seek shareholder approval of a proposed business combination or will allow shareholders to sell their shares to
us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the
transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. Accordingly, we may consummate
our initial business combination even if holders of a majority of the issued and outstanding ordinary shares do not approve of the business
combination we consummate.
**
*If we seek shareholder approval of our initial
business combination, our initial shareholders, directors and officers have agreed to vote in favor of such initial business combination,
regardless of how our public shareholders vote.*
Unlike many other blank check companies in which
the initial shareholders agree to vote their founder shares, private placement shares and restricted private placement shares in accordance
with the majority of the votes cast by the public shareholders in connection with an initial business combination, our initial shareholders,
directors and officers have agreed (and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into
with us, to vote their founder shares and any public shares held by them in favor of our initial business combination. Our directors and
officers have also entered into the letter agreement, imposing similar obligations on them with respect to public shares acquired by them,
if any. Our initial shareholders and their permitted transferees currently own 27.6% of our issued and outstanding ordinary shares. Accordingly,
if we seek shareholder approval of our initial business combination, it is more likely that the necessary shareholder approval will be
received than would be the case if such persons agreed to vote their founder shares in accordance with the majority of the votes cast
by our public shareholders. The non-managing investors are not required to (i) hold any units, Class A ordinary shares or public warrants
they may purchase, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination
or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The non-managing
investors have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units
purchased as the rights afforded to our other public shareholders.
**
*Your only opportunity to affect the investment
decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash,
unless we seek shareholder approval of such business combination.*
You may not be provided with an opportunity to
evaluate the specific merits or risks of any target businesses. Additionally, since our board of directors may complete a business combination
without seeking shareholder approval, public shareholders may not have the right or opportunity to vote on the business combination, unless
we seek such shareholder approval. Accordingly, if we do not seek shareholder approval, your only opportunity to affect the investment
decision regarding a potential business combination may be limited to exercising your redemption rights within the period of time (which
will be at least 20 business days) set forth in our tender offer documents mailed to our public shareholders in which we describe our
initial business combination.
**
**
9
**
*The ability of our public shareholders to
redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it
difficult for us to enter into a business combination with a target.*
We may seek to enter into a business combination
transaction agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain amount
of cash. If too many public shareholders exercise their redemption rights, we would not be able to meet such closing condition and, as
a result, would not be able to proceed with the business combination. The amount of the deferred underwriting commissions payable to the
underwriters will not be adjusted for any shares that are redeemed in connection with a business combination and such amount of deferred
underwriting commissions is not available for us to use as consideration in an initial business combination. If we are able to consummate
an initial business combination, the per-share value of shares held by non-redeeming shareholders will reflect our obligation to pay and
the payment of the deferred underwriting commissions. Consequently, if accepting all properly submitted redemption requests would not
allow us to satisfy a closing condition as described above, we would not proceed with such redemption and the related business combination
and may instead search for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant
to enter into a business combination transaction with us.
**
*The ability of our public shareholders to
exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination
or optimize our capital structure.*
At the time we enter into an agreement for our
initial business combination, we will not know how many shareholders may exercise their redemption rights and, therefore, we will need
to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial
business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us
to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements,
or arrange for third-party financing. In addition, if a larger number of shares is submitted for redemption than we initially expected,
we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third-party financing.
Raising additional third-party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable
levels. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize
our capital structure.
**
*The ability of our public shareholders to
exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination
would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.*
If our initial business combination agreement
requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash
at closing, the probability that our initial business combination would be unsuccessful increases. If our initial business combination
is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account. If you are in
need of immediate liquidity, you could attempt to sell your shares in the open market; however, at such time our shares may trade at a
discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment
or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to sell your shares in the
open market.
**
*The requirement that we complete our initial
business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business
combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular
as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that
would produce value for our shareholders.*
Any potential target business with which we enter
into negotiations concerning a business combination will be aware that we must complete our initial business combination by July 16, 2026
or such earlier liquidation date as our board of directors may approve, or during any Extension Period. Consequently, such target business
may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial business combination
with that particular target business, we may be unable to complete our initial business combination with any target business. This risk
will increase as we get closer to the end of such time period. In addition, we may have limited time to conduct due diligence and may
enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
**
**
10
**
*We may not be able to complete our initial
business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up
and we would redeem our public shares and liquidate, in which case our public shareholders may receive only $10.10 per share, or less
than such amount in certain circumstances, and our warrants will expire worthless.*
Our sponsor and our directors and officers have
agreed that we must complete our initial business combination by July 16, 2026, or such earlier liquidation date as our board of directors
may approve, or during any Extension Period. We may not be able to find a suitable target business and complete our initial business combination
within such time period. Our ability to complete our initial business combination may be negatively impacted by general market conditions,
volatility in the capital and debt markets and the other risks described herein. For example, geopolitical instability emanating from
the ongoing conflict between Russia and the Ukraine and the recent escalation of conflict in the Middle East could limit our ability to
complete our initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party
financing being unavailable on terms acceptable to us or at all. Additionally, geopolitical stability may negatively impact businesses
we may seek to acquire.
If we have not completed our initial business
combination within such time period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably
possible but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the
aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest
shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses) and not previously released to us to pay our
taxes, if any, divided by the number of then-outstanding public shares, which redemption will completely extinguish public shareholders
rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (3)
as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors,
liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements
of other applicable law. In such case, our public shareholders may receive only $10.10 per share, or less than $10.10 per share, on the
redemption of their shares, and our warrants will expire worthless. See - *If third parties bring claims against us, the proceeds
held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.10 per share*
and other risk factors herein.
If we are unable to complete an initial business
combination within the 18-month period, we may seek an amendment to our amended and restated memorandum and articles of association to
extend the period of time we have to complete an initial business combination beyond 18 months. Any amendment of our amended and restated
memorandum and articles of association will require at least a special resolution of our shareholders as a matter of Cayman Islands law,
meaning that such an amendment must be approved by holders of at least two-thirds of our ordinary shares who attend and vote (whether
in person or by proxy) at a general meeting of the company. If we seek shareholder approval to extend the initial 18-month period in which
to complete an initial business combination to a later date, we will offer our public shareholders the right to have their public ordinary
shares redeemed for a pro rata share of the aggregate amount then on deposit in the trust account, as described in greater detail in this
Annual Report.
**
*Our search for an initial business combination,
and any target business with which we may ultimately consummate an initial business combination, may be materially adversely affected
by current global geopolitical conditions resulting from the ongoing Russia-Ukraine conflict and the recent escalation of conflict in
the Middle East.*
United States and global markets are experiencing
volatility and disruption following the geopolitical instability resulting from the ongoing Russia-Ukraine conflict and the recent escalation
of conflict in the Middle East, including the recent conflict involving the United States, Israel and Iran. The invasion of Ukraine by
Russia and the escalation of conflict in the Middle East, including U.S. and Israeli strikes on Iran, and retaliatory strikes by Iran
on, among others, Israel, Saudi Arabia, and the United Arab Emirates, and the resulting measures that have been taken, and could be taken
in the future, by NATO, the United States, the United Kingdom, the European Union, Israel and its neighboring states and other countries
have created global security concerns that could have a lasting impact on regional and global economies. Although the length and impact
of the ongoing conflicts are highly unpredictable, they have led to and could continue to create market disruptions, including significant
volatility in commodity prices, credit and capital markets, as well as supply chain interruptions. Any of the abovementioned factors,
or any other negative impact on the global economy, capital markets or other geopolitical conditions could adversely affect our search
for an initial business combination and any target business with which we may ultimately consummate an initial business combination. The
extent and duration of the ongoing conflicts and any related market disruptions are impossible to predict, but could be substantial, particularly
if geopolitical tensions result in expanded military operations on a global scale. Any such disruptions may also have the effect of heightening
many of the other risks described in this section. If these disruptions or other matters of global concern continue for an extensive period
of time, our ability to consummate an initial business combination, or the operations of a target business with which we may ultimately
consummate an initial business combination, may be materially adversely affected.
**
**
11
**
*Military or other conflicts in Ukraine,
the Middle East or elsewhere may lead to increased volume and price volatility for publicly traded securities, or affect the operations
or financial condition of potential target companies, which could make it more difficult for us to consummate an initial business combination.*
Military or other conflicts in Ukraine, the Middle
East or elsewhere may lead to increased volume and price volatility for publicly traded securities, or affect the operations or financial
condition of potential target companies, and to other company or industry-specific, national, regional or international economic disruptions
and economic uncertainty, any of which could make it more difficult for us to identify a business combination target and consummate an
initial business combination on acceptable commercial terms, or at all.
*Macro-economic turbulence and instability
relating to recent and ongoing global conflicts and other drivers of uncertainty may adversely affect our business, investments and results
of operations and our ability to successfully consummate a business combination.*
A deterioration in economic conditions and related
drivers of global uncertainty and change, such as reduced business activity, high unemployment, rising interest rates, housing prices,
and energy prices (including the price of gasoline), increased consumer indebtedness, lack of available credit, the rate of inflation,
and consumer perceptions of the economy, as well as other factors, such as terrorist attacks, protests, looting, and other forms of civil
unrest, cyber attacks and data breaches, public health emergencies (such as another pandemic and other epidemics), extreme weather conditions
and climate change, significant changes in the political environment, political instability, armed conflict (such as the ongoing military
conflict between Ukraine and Russia and the recent escalation of conflict in the Middle East) and/or public policy, including increased
state, local or federal taxation, could adversely affect our financial condition, the financial condition of prospective target companies
for our initial business combination, or the financial condition of the combined company even if we successfully consummate a business
combination, as well as our ability to locate a commercially viable target company for our business combination in the first instance.
**
*Inflation in the United States and elsewhere
could make it more difficult for us to consummate a business combination.*
Inflation in the United Stated and elsewhere may
lead to increased price volatility in publicly traded securities, including ours, and may lead to other national, regional and international
economic disruptions, any of which could make it more difficult for us to consummate a business combination.
**
*Changes in the market for directors and
officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination.*
In recent years, the market for directors and
officers liability insurance for special purpose acquisition companies has changed in ways adverse to us and our management team. The
premiums charged for such policies have generally increased and the terms of such policies have generally become less favorable. These
trends may continue into the future.
The increased cost and decreased availability
of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial business
combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company,
the post-business combination entity might need to incur greater expense, accept less favorable terms or both. However, any failure to
obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combinations ability
to attract and retain qualified officers and directors.
In addition, even after we were to complete an
initial business combination, our directors and officers could still be subject to potential liability from claims arising from conduct
alleged to have occurred prior to the initial business combination. As a result, in order to protect our directors and officers, the post-business
combination entity may need to purchase additional insurance with respect to any such claims (run-off insurance). The need
for run-off insurance would be an added expense for the post-business combination entity, and could interfere with or frustrate our ability
to consummate an initial business combination on terms favorable to our investors.
**
*If we seek shareholder approval of our initial
business combination, our sponsor, directors, officers, advisors or any of their affiliates may elect to purchase shares or public warrants
from public shareholders, which may increase the likelihood of closing our initial business combination and reduce the public float
of our securities.*
If we seek shareholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our sponsor, directors, officers, advisors or any of their affiliates may purchase public shares or public warrants in privately
negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Any such
price per share may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection
with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable
securities laws (including with respect to material nonpublic information), our sponsor, directors, officers, advisors or any of their
affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their
public shares in favor of our initial business combination or not redeem their public shares. However, our sponsor, directors, officers,
advisors or any of their affiliates are under no obligation or duty to do so and they have no current commitments, plans or intentions
to engage in such transactions and have not formulated any terms or conditions for any such transactions.
12
The purpose of such purchases would be to (1)
increase the likelihood of closing the business combination or (2) satisfy a closing condition in an agreement with a target that requires
us to have a minimum net worth or a certain amount of cash at the closing of the business combination, where it appears that such requirement
would otherwise not be met. This may result in the consummation of an initial business combination that may not otherwise have been possible.
To the extent that any public shares are purchased such purchases will be in compliance with all of the requirements set forth in Tender
Offers and Schedules Compliance and Disclosure Interpretations Question 166.01 promulgated by the SEC, including that such public shares
will not be voted. In addition, if such purchases are made, the public float of our securities and the number of beneficial
holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our
securities on a national securities exchange.
Any such purchases will be reported pursuant to
Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. Additionally,
in the event our sponsor, directors, officers, advisors and/or any of their respective affiliates were to purchase public shares or warrants
from public shareholders, such purchases would be structured in compliance with the requirements of Rule 14e-5 under the Exchange Act
including, in pertinent part, through adherence to the following:
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our registration statement/proxy statement filed for our business combination transaction would disclose the possibility that our sponsor, directors, officers, advisors and/or any of their respective affiliates may purchase shares or warrants from public shareholders outside the redemption process, along with the purpose of such purchases; | |
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if our sponsor, directors, officers, advisors and/or any of their respective affiliates were to purchase public shares or warrants from public shareholders, they would do so at a price no higher than the price offered through our redemption process; | |
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our registration statement/proxy statement filed for our business combination transaction would include a representation that any of our securities purchased by our sponsor, directors, officers, advisors and/or any of their respective affiliates would not be voted in favor of approving the business combination transaction; | |
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our sponsor, directors, officers, advisors and/or any of their respective affiliates would not possess any redemption rights with respect to our securities or, if they do acquire and possess redemption rights, they would waive such rights; and | |
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we would disclose in a Form 8-K, before our security holder meeting to approve the business combination transaction, the following material items: | |
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the amount of our securities purchased outside of the redemption offer by our sponsor, directors, officers, advisors and/or any of their respective affiliates, along with the purchase price; | |
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the purpose of the purchases by our sponsor, directors, officers, advisors and/or any of their respective affiliates; | |
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the impact, if any, of the purchases by our sponsor, directors, officers, advisors and/or any of their respective affiliates on the likelihood that the business combination transaction will be approved; | |
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the identities of our security holders who sold to our sponsor, directors, officers and/or any of their respective affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our sponsor, directors, officers, advisors and/or any of their respective affiliates; and | |
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the number of our securities for which we have received redemption requests pursuant to our redemption offer. | |
**
*We may not be able to complete an initial
business combination since such initial business combination may be subject to regulatory review and approval requirement, including foreign
investment regulations and review by government entities such as the Committee on Foreign Investment in the United States (CFIUS),
or may be ultimately prohibited.*
The sponsor is a Delaware limited liability company,
and is not controlled by, nor has substantial ties with any non-U.S. person.Our initial business combination may be subject
to regulatory review and approval requirements by governmental entities, or ultimately prohibited. For example, CFIUS has authority to
review direct or indirect foreign investments in U.S. companies. Among other things, CFIUS is empowered to require certain foreign investors
to make mandatory filings, to charge filing fees related to such filings, and to self-initiate national security reviews of foreign direct
and indirect investments in U.S. companies if the parties to that investment choose not to file voluntarily. In the case that CFIUS determines
an investment to be a threat to national security, CFIUS has the power to unwind or place restrictions on the investment. Whether CFIUS
has jurisdiction to review an acquisition or investment transaction depends on - among other factors - the nature and structure of the
transaction, including the level of beneficial ownership interest and the nature of any information or governance rights involved. For
example, investments that result in control of a U.S. business by foreign person always are subject to CFIUS jurisdiction.
CFIUSs expanded jurisdiction under the Foreign Investment Risk Review Modernization Act of 2018 and implementing regulations that
became effective on February 13, 2020 further includes investments that do not result in control of a U.S. business by a foreign person
but afford certain foreign investors certain information or governance rights in a U.S. business that has a nexus to critical technologies,
critical infrastructure and/or sensitive personal data.
13
If a particular proposed initial business combination
with a U.S. business falls within CFIUSs jurisdiction, we may determine that we are required to make a mandatory filing or that
we will submit to CFIUS review on a voluntary basis, or to proceed with the transaction without submitting to CFIUS and risk CFIUS intervention,
before or after closing the transaction. CFIUS may decide to block or delay our proposed initial business combination, impose conditions
with respect to such initial business combination or request the President of the United States to order us to divest all or a portion
of the U.S. target business of our initial business combination that we acquired without first obtaining CFIUS approval, which may limit
the attractiveness of, delay or prevent us from pursuing certain target companies that we believe would otherwise be beneficial to us
and our shareholders. As a result, the pool of potential targets with which we could complete an initial business combination may be limited
and we may be adversely affected in terms of competing with other special purpose acquisition companies which do not have similar foreign
ownership issues. In addition, certain federally licensed businesses may be subject to rules or regulations that limit foreign ownership.
The process of government review, whether by CFIUS
or otherwise, could be lengthy. Because we have only a limited time to complete our initial business combination, our failure to obtain
any required approvals within the requisite time period may require us to liquidate. If we are unable to consummate our initial business
combination within the applicable time period required under our amended and restated memorandum and articles of association, including
as a result of extended regulatory review of a potential initial business combination, we will, as promptly as reasonably possible but
not more than ten business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and
as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors,
liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements
of other applicable law. In such event, our shareholders will miss the opportunity to benefit from an investment in a target company and
the appreciation in value of such investment. Additionally, our warrants will be worthless.
**
*Because of our limited resources and the
significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination.
If we have not completed our initial business combination within the required time period, our public shareholders may receive only approximately
$10.10 per share, or less in certain circumstances, on our redemption of their shares, and our warrants will expire worthless.*
We expect to encounter intense competition from
other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships),
other blank check companies and other entities, domestic and international, competing for the types of businesses we intend to acquire.
Many of these individuals and entities are well established and have extensive experience in identifying and effecting, directly or indirectly,
acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical,
human and other resources or more local industry knowledge than we do and our financial resources will be relatively limited when contrasted
with those of many of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net
proceeds of our initial public offering and the sale of the private placement securities, our ability to compete with respect to the acquisition
of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation
gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, in the event we seek shareholder approval
of our initial business combination and we are obligated to pay cash for our Class A ordinary shares, it will potentially reduce the resources
available to us for our initial business combination. Any of these obligations may place us at a competitive disadvantage in successfully
negotiating a business combination. If we have not completed our initial business combination within the required time period, our public
shareholders may receive only approximately $10.10 per share, or less in certain circumstances, on the liquidation of our trust account
and our warrants will expire worthless. See - *If third parties bring claims against us, the proceeds held in the trust account
could be reduced and the per-share redemption amount received by shareholders may be less than $10.10 per share* and other risk
factors herein.
**
*Uncertainty in connection with certain international
economic and political relationships, including the imposition of tariffs on international trade, political disputes, regulatory changes
and other international matters could have a material adverse effect on our ability to identify potential targets and to consummate our
initial business combination, and could adversely affect the financial performance of any target, either foreign or domestic.*
**
The international economic and political environment
is dynamic and subject to change. There is currently significant uncertainty about the future economic and political relationships between
the United States and a number of other countries. These uncertainties include, among other things, the actual or potential imposition
of protective tariffs on goods imported from other countries and reciprocal tariffs other countries may impose on United States products,
political disputes that may affect relationships between the United States and other countries and the imposition of regulatory or other
restrictions on trade and commerce. Any such matters could potentially limit the number of potential targets we may consider, and could
also have a material adverse effect on the financial performance of such potential targets. Among other things, historical financial performance
of companies affected by these international matters may not provide as accurate a barometer of future performance as would pertain in
a more stable economic environment.
14
*As the number of special purpose acquisition
companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets
or such attractive targets may not be interested to consummate a business combination with a SPAC due to a negative public perception
of mergers involving SPACs. If the proposed Business Combination with CTR is not completed and we have to seek another target company,
this could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate
an initial business combination.*
In recent years, the number of special purpose
acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies
have already entered into an initial business combination, and there are still many special purpose acquisition companies preparing for
an initial public offering, as well as many such companies currently in registration. As a result, at times, fewer attractive targets
may be available to consummate an initial business combination.
In addition, because there are more special purpose
acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets
with attractive fundamentals or business models may increase, which could cause targets companies to demand improved financial terms.
Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns (including a negative public
perception of mergers involving SPACs), geopolitical tensions, or increases in the cost of additional capital needed to close business
combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate
our ability to find and consummate an initial business combination and may result in our inability to consummate an initial business combination
on terms favorable to our investors altogether.
**
*If the funds not being held in the trust
account are insufficient to allow us to operate for at least the 18 months following the closing of our initial public offering, we may
be unable to complete our initial business combination.*
The funds available to us outside of the trust
account may not be sufficient to allow us to operate for at least the 18 months following the closing of our initial public offering,
assuming that our initial business combination is not completed during that time. We expect to incur significant costs in pursuit of our
acquisition plans. Managements plans to address this need for capital through our initial public offering and potential loans from
certain of our affiliates are discussed in the section of this Annual Report titled *Managements Discussion and Analysis
of Financial Condition and Results of Operations*. However, our affiliates are not obligated to make loans to us in the future,
and we may not be able to raise additional financing from unaffiliated parties necessary to fund our expenses. Any such event in the future
may negatively impact the analysis regarding our ability to continue as a going concern at such time.
Of the funds
available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our search for a target
business. If we have not completed our initial business combination within the required time period, our public shareholders may receive
only approximately $10.10 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire
worthless. See - *If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share
redemption amount received by shareholders may be less than $10.10 per share* and other risk factors herein.
**
*If the net proceeds of our initial public
offering and the sale of the private placement securities not being held in the trust account are insufficient, it could limit the amount
available to fund our search for a target business or businesses and complete our initial business combination and we may depend on loans
from our sponsor or management team to fund our search, to pay our taxes and to complete our initial business combination.*
Of the net proceeds of our initial public offering
and the sale of the private placement securities, only approximately $953,750 are available to us outside the trust account to fund our
working capital requirements. In the event that our offering expenses exceed our estimate of $600,000 (excluding underwriting commissions),
we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside
the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate
of $600,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required
to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be
forced to liquidate. Neither our sponsor, members of our management team nor any of their affiliates is under any obligation to loan funds
to, or otherwise invest in, us in such circumstances. Any such loans may be repaid only from funds held outside the trust account or from
funds released to us upon completion of our initial business combination. If we have not completed our initial business combination within
the required time period because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate
the trust account. In such case, our public shareholders may receive only $10.10 per share, or less in certain circumstances, and our
warrants will expire worthless. See - *If third parties bring claims against us, the proceeds held in the trust account could
be reduced and the per-share redemption amount received by shareholders may be less than $10.10 per share* and other risk factors
herein.
**
**
15
**
*Subsequent to our completion of our initial
business combination, we may be required to subsequently take write-downs or write-offs, restructuring and impairment or other charges
that could have a significant negative effect on our financial condition, results of operations and the price of our securities, which
could cause you to lose some or all of your investment.*
Even if we conduct extensive due diligence on
a target business with which we combine, such as CTR, we cannot assure you that this diligence will identify all material issues that
may be present with a particular target business that it would be possible to uncover all material issues through a customary amount of
due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these factors,
we may be forced to later write down or write off assets, restructure our operations, or incur impairment or other charges that could
result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously
known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items
and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market
perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants to which
we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining post-combination debt
financing. Accordingly, any shareholder or warrant holder who chooses to remain a shareholder or warrant holder, respectively, following
our initial business combination could suffer a reduction in the value of their securities. Such shareholders and warrant holders are
unlikely to have a remedy for such reduction in value.
**
*If, after we distribute the proceeds in
the trust account to our public shareholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or
bankruptcy or insolvency petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and
the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members
of our board of directors and us to claims of punitive damages.*
If, after we distribute the proceeds in the trust
account to our public shareholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy
or insolvency petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable
debtor/creditor and/or insolvency laws as a voidable performance. As a result, a liquidator could seek to recover some or all amounts
received by our shareholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors
and/or having acted in bad faith by paying public shareholders from the trust account prior to addressing the claims of creditors, thereby
exposing itself and us to claims of punitive damages.
**
*If, before distributing the proceeds in
the trust account to our public shareholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or
bankruptcy or insolvency petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority
over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our
liquidation may be reduced.*
If, before distributing the proceeds in the trust
account to our public shareholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy
or insolvency petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable
insolvency law, and may be included in our liquidation estate and subject to the claims of third parties with priority over the claims
of our shareholders. To the extent any liquidation claims deplete the trust account, the per-share amount that would otherwise be received
by our shareholders in connection with our liquidation would be reduced.
**
*Adverse developments affecting the financial
services industry, including events or concerns involving liquidity, defaults or non-performance by financial institutions, could adversely
affect our business, financial condition or results of operations, or our prospects.*
The funds in our operating account and our trust
account will be held in banks or other financial institutions and will be invested or held only in either (i) U.S. government treasury
obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment
Company Act which invest only in direct U.S. government treasury obligations, (ii) as uninvested cash, or (iii) an interest bearing bank
demand deposit account or other accounts at a bank. To mitigate the risk that we might be deemed to be an investment company for purposes
of the Investment Company Act, which risk increases the longer we hold investments in the trust account, we may, at any time (and will
no later than 18 months from the closing of our initial public offering) instruct the trustee to liquidate the investments held in the
trust account and instead to hold the funds in the trust account in cash or in an interest bearing demand deposit account. For more information
about the risk of the company being considered to be operating as an unregistered investment company, see - *If we are deemed
to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our
activities may be restricted, which may make it difficult for us to complete our initial business combination*. Our cash held
in non-interest bearing and interest-bearing accounts may exceed any applicable Federal Deposit Insurance Corporation (FDIC)
insurance limits. Should events, including limited liquidity, defaults, non-performance or other adverse developments occur with respect
to the banks or other financial institutions that hold our funds, or that affect financial institutions or the financial services industry
generally, or concerns or rumors about any events of these kinds or other similar risks, the value of the assets in our trust account
could be impaired, which could have a material impact on our operating results, liquidity, financial condition and prospects. For example,
on March 10, 2023, the FDIC announced that Silicon Valley Bank had been closed by the California Department of Financial Protection and
Innovation. We cannot guarantee that the banks or other financial institutions that will hold our funds will not experience similar issues.
**
**
16
**
*If we are deemed to be an investment company
under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted,
which may make it difficult for us to complete our initial business combination.*
If we are deemed to be an investment company under
the Investment Company Act, our activities may be restricted, including:
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restrictions on the nature of our investments; and | |
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restrictions on the issuance of securities; | |
each of which may make it difficult for us to
complete our initial business combination.
In addition, we may have imposed upon us burdensome
requirements, including:
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registration as an investment company; | |
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adoption of a specific form of corporate structure; and | |
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reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations. | |
On January 24, 2024, the SEC adopted a series
of new rules relating to SPACs. The SECs adopted rules do not provide a safe harbor for SPACs from the definition of investment
company under the Investment Company Act. Instead, the SECs adopting release provided guidance describing circumstances
in which a SPAC could become subject to regulation under the Investment Company Act, including as a result of its duration, asset composition,
business purpose, and the activities of the SPAC and its management team in furtherance of such goals.
In order not to be regulated as an investment
company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business
other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting, owning, holding
or trading investment securities constituting more than 40% of our total assets (exclusive of U.S. government securities
and cash items) on an unconsolidated basis. Our business will be to identify and complete an initial business combination and thereafter
to operate the post-transaction business or assets for the long term. We do not plan to buy businesses or assets with a view to resale
or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor.
We do not believe that our anticipated principal
activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account will be invested or held
only in either (i) U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions
under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations, (ii) as uninvested
cash, or (iii) an interest bearing bank demand deposit account or other accounts at a bank. To mitigate the risk that we might be deemed
to be an investment company for purposes of the Investment Company Act, which risk increases the longer we hold investments in the trust
account, we may, at any time (and will no later than 18 months from the closing of our initial public offering) instruct the trustee to
liquidate the investments held in the trust account and instead to hold the funds in the trust account in cash or in an interest bearing
demand deposit account.
Pursuant to the trust agreement, the trustee is
not permitted to invest in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having
a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner
of a merchant bank or private equity fund), we intend to avoid being deemed an investment company within the meaning of
the Investment Company Act. The trust account is intended as a holding place for funds pending the earliest to occur of: (i) the completion
of our initial business combination; (ii) the redemption of any public shares properly submitted in connection with a shareholder vote
to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to offer
redemption rights in connection with any proposed initial business combination or certain amendments to our amended and restated memorandum
and articles of association prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination
within the prescribed timeframe; or (B) with respect to any other material provision relating to shareholders rights or pre-initial
business combination activity; or (iii) absent an initial business combination within the prescribed timeframe, from the closing of our
initial public offering, our return of the funds held in the trust account to our public shareholders as part of our redemption of the
public shares.
We are aware of litigation against certain special
purpose acquisition companies asserting that notwithstanding the foregoing, those special purpose acquisition companies should be considered
investment companies. Although we believe that these claims are without merit, we cannot guarantee that we will not be deemed to be an
investment company and thus subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance
with these additional regulatory burdens would require additional expenses for which we have not allotted funds, may require us to otherwise
change our operations and may hinder our ability to complete an initial business combination or may result in our liquidation and the
winding up of our operations. If we are unable to complete our initial business combination and are required to liquidate, our public
shareholders would lose their opportunity to invest in a target business or businesses through our initial business combination, including
any price appreciation of the combined companys securities following such initial business combination, and may receive only approximately
$10.10 per share on the liquidation of our trust account as well as our warrants will expire worthless.
**
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**
*Holders of Class A ordinary shares will
not be entitled to vote on any appointment of directors we hold prior to our initial business combination.*
Prior to our initial business combination, only
holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled
to vote on the appointment of directors during such time; provided, however, that if all of the founder shares are converted prior to
the date of the initial business combination, the holders of our public shares will have the right to vote on the election of directors.
In addition, prior to our initial business combination, holders of a majority of our founder shares may remove a member of the board of
directors for any reason. Accordingly, as holders of our Class A ordinary shares, our public shareholders will not have any say in the
management of our company prior to the consummation of an initial business combination.
**
*Because we are not limited to a particular
industry or any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the
merits or risks of any particular target businesss operations.*
We may seek to complete a business combination
with an operating company of any size (subject to our satisfaction of the 80% of net assets test) and in any industry, sector or geography.
However, we will not, under our amended and restated memorandum and articles of association, be permitted to effectuate our initial business
combination solely with another blank check company or similar company with nominal operations. Because we have not yet selected or approached
any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of any
particular target businesss operations, results of operations, cash flows, liquidity, financial condition or prospects. To the
extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations with which
we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of sales or earnings,
we may be affected by the risks inherent in the business and operations of a financially unstable or development stage entity. Although
our directors and officers will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we
will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence. Furthermore,
some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will
adversely impact a target business. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable
to our investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any shareholder
or warrant holder who chooses to remain a shareholder or warrant holder, respectively, following our initial business combination could
suffer a reduction in the value of their securities. Such shareholders and warrant holders are unlikely to have a remedy for such reduction
in value.
**
*Although we have identified general criteria
and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination
with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial
business combination may not have attributes entirely consistent with our general criteria and guidelines.*
Although we have identified general criteria and
guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our initial business
combination will not have all of these positive attributes. If we complete our initial business combination with a target that does not
meet some or all of these criteria and guidelines, such combination may not be as successful as a combination with a business that does
meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target that does
not meet our general criteria and guidelines, a greater number of shareholders may exercise their redemption rights, which may make it
difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount
of cash. In addition, if shareholder approval of the transaction is required by applicable law or stock exchange listing requirements,
or we decide to obtain shareholder approval for business or other reasons, it may be more difficult for us to attain shareholder approval
of our initial business combination if the target business does not meet our general criteria and guidelines. If we have not completed
our initial business combination within the required time period, our public shareholders may receive only approximately $10.10 per share,
or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.
**
*We may seek acquisition opportunities with
an early stage company, a financially unstable business or an entity lacking an established record of revenue or earnings.*
To the extent we complete our initial business
combination with an early stage company, a financially unstable business or an entity lacking an established record of sales or earnings,
we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include investing in
a business without a proven business model and with limited historical financial data, volatile revenues or earnings, intense competition
and difficulties in obtaining and retaining key personnel. Although our directors and officers will endeavor to evaluate the risks inherent
in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not
have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability
to control or reduce the chances that those risks will adversely impact a target business.
**
18
**
*We are not required to obtain an opinion
from an independent investment banking firm or from an independent accounting firm regarding fairness. Consequently, you may have no assurance
from an independent source that the price we are paying**for the business is fair to our company from a financial point of
view.*
Unless we complete our initial business combination
with an affiliated entity, we are not required to obtain an opinion that the price we are paying is fair to our company from a financial
point of view. If no opinion is obtained, our shareholders will be relying on the judgment of our board of directors, who will determine
fair market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our tender
offer documents or proxy solicitation materials, as applicable, related to our initial business combination.
**
*Resources could be wasted in researching
acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another
business. If we have not completed our initial business combination within the required time period, our public shareholders may receive
only approximately $10.10 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our
warrants will expire worthless.*
We anticipate that the investigation of each specific
target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require
substantial management time and attention and substantial costs for accountants, attorneys and others. If we decide not to complete a
specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be recoverable.
Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business combination
for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs incurred
which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we have not completed
our initial business combination within the required time period, our public shareholders may receive only approximately $10.10 per share,
or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.
**
*We may have limited ability to assess the
management of a prospective target business and, as a result, may affect our initial business combination with a target business whose
management may not have the skills, qualifications or abilities to manage a public company.*
When evaluating the desirability of effecting
our initial business combination with a prospective target business, our ability to assess the target businesss management may
be limited due to a lack of time, resources or information.
Our assessment of the capabilities of the targets
management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should
the targets management not possess the skills, qualifications or abilities necessary to manage a public company, the operations
and profitability of the post-combination business may be negatively impacted. Accordingly, any shareholder or warrant holder who chooses
to remain a shareholder or warrant holder, respectively, following our initial business combination could suffer a reduction in the value
of their securities. Such shareholders and warrant holders are unlikely to have a remedy for such reduction in value.
The directors and officers of an acquisition candidate
may resign upon completion of our initial business combination. The departure of a business combination targets key personnel could
negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidates key
personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain
members of an acquisition candidates management team will remain associated with the acquisition candidate following our initial
business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place.
**
**
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**
*We may issue notes or other debt securities,
or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition
and thus negatively impact the value of our shareholders investment in us.*
Although we have no commitments as of the date
of this Annual Report to issue any notes or other debt securities, or to otherwise incur outstanding debt, we may choose to incur substantial
debt to complete our initial business combination. We have agreed that we will not incur any indebtedness unless we have obtained from
the lender a waiver of any right, title, interest or claim of any kind in or to the monies held in the trust account. As such, no issuance
of debt will affect the per-share amount available for redemption from the trust account. Nevertheless, the incurrence of debt could have
a variety of negative effects, including:
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default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations; | |
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acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; | |
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our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand; | |
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our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding; | |
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our inability to pay dividends on our ordinary shares; | |
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using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our ordinary shares if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; | |
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limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; | |
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increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and | |
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limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. | |
**
*We may be able to complete only one business
combination with the proceeds of our initial public offering and the sale of the private placement securities, which will cause us to
be solely dependent on a single business which may have a limited number of products or services. This lack of diversification may negatively
impact our operations and profitability.*
The gross proceeds from our initial public offering
and the sale of the private placement securities are or approximately $179.2 million that we may use to complete our initial business
combination (which includes up to $6,900,000 of deferred underwriting commissions being held in the trust account, and excludes estimated
offering expenses of $600,000 (other than underwriting commissions) relating to our initial public offering)).
We may effectuate our initial business combination
with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not be able
to effectuate our initial business combination with more than one target business because of various factors, including the existence
of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating
results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial
business combination with only a single entity our lack of diversification may subject us to numerous economic, competitive and regulatory
risks. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses,
unlike other entities which may have the resources to complete several business combinations in different industries or different areas
of a single industry. Accordingly, the prospects for our success may be:
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solely dependent upon the performance of a single business, property or asset; or | |
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dependent upon the development or market acceptance of a single or limited number of products, processes or services. | |
This lack of diversification may subject us to
numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry
in which we may operate subsequent to our initial business combination.
**
**
20
**
*If we are unable to complete the proposed
business combination with CTR, we may attempt to simultaneously complete business combinations with multiple prospective targets, which
may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact
our operations and profitability.*
If we determine to simultaneously acquire several
businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent
on the simultaneous closings of the other business combinations, which may make it more difficult for us, and delay our ability, to complete
our initial business combination. With multiple business combinations, we could also face additional risks, including additional burdens
and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional
risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating
business. If we are unable to adequately address these risks, it could negatively impact our profitability and results of operations.
**
*We may attempt to complete our initial business
combination with a private company about which little information is available, which may result in a business combination with a company
that is not as profitable as we suspected, if at all.*
In pursuing our acquisition strategy, we may seek
to effectuate our initial business combination with a privately held company. Very little public information generally exists about private
companies, and we could be required to make our decision on whether to pursue a potential initial business combination on the basis of
limited information, which may result in a business combination with a company that is not as profitable as we suspected, if at all.
**
*We do not have a specified maximum redemption
threshold. The absence of such a redemption threshold may make it possible for us to complete a business combination with which a substantial
majority of our shareholders do not agree.*
Our amended and restated memorandum and articles
of association do not provide a specified maximum redemption threshold. As a result, we may be able to complete our initial business combination
even though a substantial majority of our public shareholders do not agree with the transaction and have redeemed their shares or, if
we seek shareholder approval of our initial business combination and do not conduct redemptions in connection with our initial business
combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor,
directors, officers, advisors or any of their affiliates. In the event the aggregate cash consideration we would be required to pay for
all public shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms
of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination
or redeem any shares, and all ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search
for an alternate business combination.
**
*In order to effectuate an initial business
combination, blank check companies have, in the past, amended various provisions of their charters and modified governing instruments,
including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated memorandum and articles
of association or governing instruments in a manner that will make it easier for us to complete our initial business combination that
some of our shareholders may not support.*
In order to effectuate an initial business combination,
blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments, including
their warrant agreements. For example, blank check companies have amended the definition of business combination, increased redemption
thresholds and extended the time to consummate an initial business combination and, with respect to their warrants, amended their warrant
agreements to require the warrants to be exchanged for cash and/or other securities. Amending our amended and restated memorandum and
articles of association requires at least a special resolution of our shareholders as a matter of Cayman Islands law. A resolution is
deemed to be a special resolution as a matter of Cayman Islands law where it has been approved by either (1) holders of at least two-thirds
(or any higher threshold specified in a companys articles of association) of a companys ordinary shares who attend and vote
at a general meeting for which notice specifying the intention to propose the resolution as a special resolution has been given or (2)
if so authorized by a companys articles of association, by a unanimous written resolution of all of the companys shareholders.
Our amended and restated memorandum and articles of association provide that special resolutions must be approved either by holders of
at least two-thirds of our ordinary shares who attend and vote at a general meeting (i.e. the lowest threshold permissible under Cayman
Islands law) (other than amendments relating to provisions governing the appointment or removal of directors prior to our initial business
combination, which require the approval of a majority of at least 90% of our ordinary shares attending and voting in a general meeting),
or by a unanimous written resolution of all of our shareholders. The warrant agreement provides that (a) the terms of the public warrants
may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or correct any mistake, including to conform
the provisions of the warrant agreement to the description of the terms of the public warrants and the warrant agreement set forth in
this Annual Report, or defective provision (ii) removing or reducing the Companys ability to redeem the public warrants and, if
applicable, a corresponding amendment to the Companys ability to redeem the private placement warrants or (iii) adding or changing
any provisions with respect to matters or questions arising under the warrant agreement as the parties to the warrant agreement may deem
necessary or desirable and that the parties deem to not adversely affect the rights of the registered holders of the public warrants under
the warrant agreement in any material respect, (b) the terms of the warrants may be amended with the vote or written consent of at least
50% of the then outstanding public warrants and private placement warrants, voting together as a single class, to allow for the warrants
to be, or continue to be, as applicable, classified as equity in our financial statements and (c) all other modifications or amendments
to our warrant agreement with respect to (i) the public warrants require the vote or written consent of holders of at least 50% of the
then outstanding public warrants, and (ii) the private placement warrants require the vote or written consent of holders of at least 50%
of the then outstanding private placement warrants. We cannot assure you that we will not seek to amend our amended and restated memorandum
and articles of association or governing instruments, including the warrant agreement, or extend the time to consummate an initial business
combination in order to effectuate our initial business combination. To the extent any of such amendments would be deemed to fundamentally
change the nature of any of the securities offered through this registration statement, we would register, or seek an exemption from registration
for, the affected securities.
**
21
**
*Certain provisions of our amended and restated
memorandum and articles of association that relate to our pre-business combination activity (and corresponding provisions of the agreement
governing the release of funds from our trust account) may be amended with the approval of holders of at least two-thirds of our ordinary
shares who attend and vote at a general meeting, which is a lower amendment threshold than that of some other blank check companies. It
may be easier for us, therefore, to amend our amended and restated memorandum and articles of association and the trust agreement to facilitate
the completion of an initial business combination that some of our shareholders may not support.*
Our amended and restated memorandum and articles
of association provide that any of its provisions, including those related to pre-business combination activity (including the requirement
to deposit proceeds of our initial public offering and the sale of private placement securities into the trust account and not release
such amounts except in specified circumstances), may be amended if approved by holders of at least two-thirds of our ordinary shares who
attend and vote in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust
account may be amended if approved by holders of 65% of our ordinary shares (other than amendments relating to provisions governing the
appointment or removal of directors prior to our initial business combination, which require the approval of a majority of at least 90%
of our ordinary shares attending and voting in a general meeting). Our initial shareholders, who collectively beneficially own approximately
25% of our ordinary shares, may participate in any vote to amend our amended and restated memorandum and articles of association and/or
trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of
our amended and restated memorandum and articles of association which govern our pre-business combination behavior more easily than some
other blank check companies, and this may increase our ability to complete our initial business combination with which you do not agree.
In certain circumstances, our shareholders may pursue remedies against us for any breach of our amended and restated memorandum and articles
of association.
**
*We may be unable to obtain additional financing
to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure
or abandon a particular business combination.*
Although we believe that the net proceeds of our
initial public offering and the sale of the private placement securities will be sufficient to allow us to complete our initial business
combination, because we have not yet selected any target business we cannot ascertain the capital requirements for any particular transaction.
If the net proceeds of our initial public offering prove to be insufficient, either because of the size of our initial business combination,
the depletion of the available net proceeds in search of a target business, the obligation to redeem for cash a significant number of
shares from shareholders who elect redemption in connection with our initial business combination or the terms of negotiated transactions
to purchase shares in connection with our initial business combination, we may be required to seek additional financing in the form of
proceeds of the sale of our shares in connection with our initial business combination, shares issued to the owners of the target, debt
issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. We cannot
assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be
unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon
that particular business combination and seek an alternative target business candidate.
In addition, even if we do not need additional
financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business.
The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business.
None of our directors, officers or shareholders is required to provide any financing to us in connection with or after our initial business
combination. If we have not completed our initial business combination within the required time period, our public shareholders may receive
only approximately $10.10 per share, or less in certain circumstances, on the liquidation of our trust account, and our warrants will
expire worthless.
**
*Because we must furnish our shareholders
with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination
with some prospective target businesses.*
The federal proxy rules require that a proxy statement
with respect to a vote on a business combination meeting certain financial significance tests include historical and/or pro forma financial
statement disclosure in periodic reports. We will include the same financial statement disclosure in connection with our tender offer
documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in
accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or U.S. GAAP, or international
financial reporting standards as issued by the International Accounting Standards Board, or IFRS, depending on the circumstances and the
historical financial statements may be required to be audited in accordance with the standards of the Public Company Accounting Oversight
Board (United States), or PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire
because some targets may be unable to provide such financial statements in time for us to disclose such financial statements in accordance
with federal proxy rules and complete our initial business combination within the prescribed time frame.
**
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**
*Compliance obligations under the Sarbanes-Oxley
Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management resources,
and increase the time and costs of completing an acquisition.*
Section 404 of the Sarbanes-Oxley Act requires
that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K for the year ending December
31, 2025. Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging
growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal
control over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley
Act particularly burdensome on us as compared to other public companies because a target business with which we seek to complete our initial
business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls.
The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and
costs necessary to complete any such acquisition.
**
*After our initial business combination,
our results of operations and prospects could be subject, to a significant extent, to the economic, political, social and government policies,
developments and conditions in the country in which we operate.*
The economic, political and social conditions,
as well as government policies, of the country in which our operations are located could affect our business. Economic growth could be
uneven, both geographically and among various sectors of the economy and such growth may not be sustained in the future. If in the future
such countrys economy experiences a downturn or grows at a slower rate than expected, there may be less demand for spending in
certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our ability to find
an attractive target business with which to consummate our initial business combination and if we effect our initial business combination,
the ability of that target business to become profitable.
**
*The outbreak of infectious diseases, endemics,
pandemics and other public health crises and the impact on businesses and debt and equity markets could have a material adverse effect
on our search for an initial business combination, and any target business with which we ultimately consummate an initial business combination.*
Beginning in late 2019, the COVID-19 pandemic
caused substantial disruption to global economies and markets and, since then, the virus has continued to spread on a global scale. A
significant outbreak of the COVID-19 and other infectious diseases, including the resurgence or variants thereof, could result in a widespread
health crisis that could adversely affect economies and financial markets worldwide, business operations and the conduct of commerce generally
and could have a material adverse effect on the business of any potential target business with which we complete a business combination.
Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 or other public health crises
restrict travel, limit the ability to have meetings with potential investors or the target companys personnel, vendors and services
providers are unavailable to negotiate and consummate a transaction in a timely manner or even to conduct requisite due diligence. In
addition, countries or supranational organizations in our target markets may develop and implement legislation that makes it more difficult
or impossible for entities outside such countries or target markets to acquire or otherwise invest in companies or businesses deemed essential
or otherwise vital. The extent to which COVID-19 or other public health crises impact our search for a business combination will depend
on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the
severity and new variants of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. While vaccines for COVID-19
have been developed, there is no guarantee that such vaccines will be durable. The treatment or vaccine for COVID-19 and any potentially
emerging variants may be ineffective or underutilized. If the disruptions posed by COVID-19 or other matters of global concern continue
for an extensive period of time, our ability to consummate a business combination, or the operations of a target business with which we
ultimately consummate a business combination, may be materially adversely affected. In addition, our ability to consummate a transaction
may be dependent on the ability to raise equity and debt financing which may be impacted by COVID-19 and other public health events, including
as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable
to us or at all. Finally, the outbreak of COVID-19 or the emergence of new or other public health crises may also have the effect of heightening
many of the other risks described in this Risk Factors section.
23
Risks Relating to our Securities
**
*We may issue our shares to investors in
connection with our initial business combination at a price which is less than the prevailing market price of our shares at that time.*
In connection with our initial business combination,
we may issue shares to investors in private placement transactions (so-called PIPE transactions). The purpose of such issuances will be
to enable us to provide sufficient liquidity to the post-business combination entity. The price of the shares we issue may therefore be
less, and potentially significantly less, than the market price for our shares at such time.
**
*There is currently no market for our securities
and a market for our securities may not develop, which would adversely affect the liquidity and price of our securities.*
There is currently no market for our securities.
Shareholders therefore have no access to information about prior market history on which to base their investment decision. Following
our initial public offering, the price of our securities may vary significantly due to one or more potential business combinations and
general market or economic conditions. Furthermore, an active trading market for our securities may never develop or, if developed, it
may not be sustained. You may be unable to sell your securities unless a market can be established and sustained.
**
*If a shareholder fails to receive notice
of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for
tendering its shares, such shares may not be redeemed.*
We will comply with the tender offer rules or
proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with
these rules, if a shareholder fails to receive our tender offer or proxy materials, as applicable, such shareholder may not become aware
of the opportunity to redeem its shares. In addition, the tender offer documents or proxy materials, as applicable, that we will furnish
to holders of our public shares in connection with our initial business combination will describe the various procedures that must be
complied with in order to validly tender or redeem public shares. In the event that a shareholder fails to comply with these procedures,
its shares may not be redeemed.
**
*You will not have any rights or interests
in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced
to sell your public shares and/or warrants, potentially at a loss.*
Our public shareholders will be entitled to receive
funds from the trust account only upon the earliest to occur of: (1) our completion of an initial business combination, and then only
in connection with those Class A ordinary shares that such shareholder properly elected to redeem, subject to the limitations described
herein; (2) the redemption of any public shares properly submitted in connection with a shareholder vote to amend our amended and restated
memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with
our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by July
16, 2026 or such earlier liquidation date as our board of directors may approve, or any Extension Period, or (B) with respect to any other
provision relating to shareholders rights or pre-initial business combination activity; and (3) the redemption of our public shares
if we have not completed an initial business combination by July 16, 2026 or such earlier liquidation date as our board of directors may
approve, or during any Extension Period, subject to applicable law. In no other circumstances will a shareholder have any right or interest
of any kind to or in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect
to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares and/or warrants, potentially
at a loss.
**
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*Nasdaq may delist our securities from trading
on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading
restrictions.*
Our units have been approved for listing on Nasdaq
on or promptly after the date of this Annual Report and our Class A ordinary shares and public warrants listed on or promptly after their
date of separation. Although after giving effect to our initial public offering we met the minimum initial listing standards set forth
in the Nasdaq listing standards, we cannot assure you that our securities will continue to be listed on Nasdaq in the future or prior
to our initial business combination. In order to continue listing our securities on Nasdaq prior to our initial business combination,
we must maintain certain financial, distribution and stock price levels. In general, we must maintain an average global market capitalization
and a minimum of 400 public holders. Additionally, in connection with our initial business combination, we will be required to demonstrate
compliance with Nasdaqs initial listing requirements, which are more rigorous than Nasdaqs continued listing requirements,
in order to continue to maintain the listing of our securities on Nasdaq. For instance, our share price would generally be required to
be at least $4.00 per share and we would be required to have a minimum of 400 round lot holders of our unrestricted securities. We cannot
assure you that we will be able to meet those initial listing requirements at that time.
If Nasdaq delists any of our securities from trading
on its exchange and we are not able to list our securities on another national securities exchange, we expect such securities could be
quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:
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a limited availability of market quotations for our securities; | |
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reduced liquidity for our securities; | |
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a determination that our Class A ordinary shares are a penny stock which will require brokers trading in our Class A ordinary shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; | |
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a limited amount of news and analyst coverage; and | |
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a decreased ability to issue additional securities or obtain additional financing in the future. | |
The National Securities Markets Improvement Act
of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred
to as covered securities. Because our units are listed, and eventually our Class A ordinary shares and public warrants will
be listed, on Nasdaq, our units qualify, and our Class A ordinary shares and public warrants will qualify, as covered securities under
such statute. Although the states are preempted from regulating the sale of covered securities, the federal statute does allow the states
to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate
or bar the sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or
restrict the sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view
blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank
check companies in their states. Further, if we were no longer listed on Nasdaq, our securities would not qualify as covered securities
under such statute and we would be subject to regulation in each state in which we offer our securities.
**
*If we seek shareholder approval of our initial
business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a group of shareholders
are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such shares in excess of 15%
of our Class A ordinary shares.*
If we seek shareholder approval of our initial
business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
rules, our amended and restated memorandum and articles of association provide that a public shareholder, together with any affiliate
of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under
Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares
sold in our initial public offering, which we refer to as the Excess Shares, without our prior consent. However, we would
not be restricting our shareholders ability to vote all of their shares (including Excess Shares) for or against our initial business
combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination
and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you
will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. And as a
result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell
your shares in open market transactions, potentially at a loss.
**
**
25
**
*If third parties bring claims against us,
the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than
$10.10 per share.*
Our placing of funds in the trust account may
not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers (other than our
independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements
with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public
shareholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing
claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar
claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim
against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims
to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will enter into
an agreement with a third party that has not executed a waiver only if management believes that such third partys engagement would
be in the best interests of the company under the circumstances.
Examples of possible instances where we may engage
a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills
are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases
where we are unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will
agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with
us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we have not completed
our initial business combination within the required time period, or upon the exercise of a redemption right in connection with our initial
business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against
us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public shareholders could be less
than the $10.10 per public share initially held in the trust account, due to claims of such creditors.
Our sponsor has agreed that it will be liable
to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered
or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the
amount of funds in the trust account to below (1) $10.10 per public share or (2) such lesser amount per public share held in the trust
account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of
interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to
seek access to the trust account and except as to any claims under our indemnity of the underwriters of our initial public offering against
certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable
against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently
verified whether our sponsor has sufficient funds to satisfy their respective indemnity obligations and believe that our sponsors
only assets are securities of our company. Our sponsor may not have sufficient funds available to satisfy those obligations. We have not
asked our sponsor to reserve for such obligations, and therefore, no funds are currently set aside to cover any such obligations. As a
result, if any such claims were successfully made against the trust account, the funds available for our initial business combination
and redemptions could be reduced to less than $10.10 per public share. In such event, we may not be able to complete our initial business
combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our directors
or officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
**
*Our directors may decide not to enforce
the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution
to our public shareholders.*
In the event that the proceeds in the trust account
are reduced below the lesser of (1) $10.10 per public share or (2) such lesser amount per share held in the trust account as of the date
of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of interest which may be
withdrawn for working capital purposes and to pay taxes, and our sponsor asserts that it is unable to satisfy its obligations or that
it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action
against the sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal
action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors
in exercising their business judgment may choose not to do so in any particular instance. If our independent directors choose not to enforce
these indemnification obligations, the amount of funds in the trust account available for distribution to our public shareholders may
be reduced below $10.10 per share.
**
**
26
**
*If we have not completed our initial business
combination within 18 months of the closing of our initial public offering, our public shareholders may be forced to wait beyond such
18 months before redemption from our trust account.*
If we have not completed our initial business
combination by July 16, 2026 or such earlier liquidation date as our board of directors may approve or during any Extension Period, we
will distribute the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account
(which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses) and not previously released
to us to pay our taxes, if any, pro rata to our public shareholders by way of redemption and cease all operations except for the purposes
of winding up of our affairs, as further described herein. Any redemption of public shareholders from the trust account shall be effected
automatically by function of our amended and restated memorandum and articles of association prior to any voluntary winding up. If we
are required to wind up, liquidate the trust account and distribute such amount therein, pro rata, to our public shareholders, as part
of any liquidation process, such winding up, liquidation and distribution must comply with the applicable provisions of the Companies
Act. In that case, investors may be forced to wait beyond the initial 18 months before the redemption proceeds of our trust account become
available to them and they receive the return of their pro rata portion of the proceeds from our trust account. We have no obligation
to return funds to investors prior to the date of our redemption or liquidation unless, prior thereto, we consummate our initial business
combination or amend certain provisions of our amended and restated memorandum and articles of association and then only in cases where
investors have properly sought to redeem their Class A ordinary shares. Only upon our redemption or any liquidation will public shareholders
be entitled to distributions if we have not completed our initial business combination within the required time period and do not amend
certain provisions of our amended and restated memorandum and articles of association prior thereto.
If we are unable to complete an initial business
combination within the 18-month period, we may seek an amendment to our amended and restated memorandum and articles of association to
extend the period of time we have to complete an initial business combination beyond 18 months. Any amendment of our amended and restated
memorandum and articles of association will require at least a special resolution of our shareholders as a matter of Cayman Islands law,
meaning that such an amendment must be approved by at least two-thirds of our ordinary shares who attend and vote (whether in person or
by proxy) at a general meeting of the company. If we seek shareholder approval to extend the initial 18-month period in which to complete
an initial business combination to a later date, we will offer our public shareholders the right to have their public ordinary shares
redeemed for a pro rata share of the aggregate amount then on deposit in the trust account, as described in greater detail in this Annual
Report.
**
*Our shareholders may be held liable for
claims by third parties against us to the extent of distributions received by them upon redemption of their shares.*
If we are forced to enter into an insolvent liquidation,
any distributions received by shareholders could be viewed as an unlawful payment if it was proved that immediately following the date
on which the distribution was made, we were unable to pay our debts as they fall due in the ordinary course of business. As a result,
a liquidator could seek to recover some or all amounts received by our shareholders. Furthermore, our directors may be viewed as having
breached their fiduciary duties to us or our creditors and/or may have acted in bad faith, and thereby exposing themselves and our company
to claims, by paying public shareholders from the trust account prior to addressing the claims of creditors. We cannot assure you that
claims will not be brought against us for these reasons. We and our directors and officers who knowingly and willfully authorized or permitted
any distribution to be paid out of our share premium account while we were unable to pay our debts as they fall due in the ordinary course
of business would be guilty of an offence under Cayman Islands law and may be liable for a fine of up to approximately $18,300 and to
imprisonment for five years in the Cayman Islands.
**
*We did not register the Class A ordinary
shares issuable upon exercise of the warrants under the Securities Act or any state securities laws in our initial public offering, and
such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to
exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.*
We did not register the Class A ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities
laws in our initial public offering. In no event will we be required to net cash settle any public warrant, or issue securities or other
compensation in exchange for the public warrants in the event that we are unable to register or qualify the shares underlying the public
warrants under applicable state securities laws and no exemption is available. If the issuance of the shares upon exercise of the public
warrants is not so registered or qualified or exempt from registration or qualification, the holder of such public warrant shall not be
entitled to exercise such public warrant and such public warrant may have no value and expire worthless. In such event, holders who acquired
their public warrants as part of a purchase of units will have paid the full unit purchase price solely for the Class A ordinary shares
included in the units.
27
However, we have agreed that, as soon as practicable,
but in no event later than 15 business days after the closing of our initial business combination, we will use our commercially reasonable
efforts to file with the SEC a registration statement covering the issuance, under the Securities Act, of the Class A ordinary shares
issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to become effective within
60 business days after the closing of our initial business combination and to maintain the effectiveness of such registration statement
and a current prospectus relating thereto until the expiration of the warrants in accordance with the provisions of the warrant agreement.
We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change in
the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by reference
therein are not current, complete or correct or the SEC issues a stop order. If the shares issuable upon exercise of the public warrants
are not registered under the Securities Act in accordance with the above requirements, we will be required to permit holders to exercise
their public warrants on a cashless basis. However, no public warrant will be exercisable for cash or on a cashless basis, and we will
not be obligated to issue any shares to holders seeking to exercise their public warrants, unless the issuance of the shares upon such
exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration
is available. Additionally, if, at the time that a public warrant is exercised, our Class A ordinary shares are not listed on a national
securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities
Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance
with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration
statement, but will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent
an exemption is not available.
In the event of a cashless exercise pursuant to
the preceding paragraph, each public warrant holder would pay the exercise price by surrendering the public warrants for that number of
Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying
the warrants, multiplied by the excess of the fair market value (defined below) less the exercise price of the warrants
by (y) the fair market value. The fair market value as used in the preceding sentence shall mean the volume weighted average
price of the Class A ordinary shares for the 10 trading days ending on the trading day prior to the date on which the notice of exercise
is received by the warrant agent.
**
*The grant of registration rights to our
initial shareholders, the underwriters and their permitted transferees may make it more difficult to complete our initial business combination,
and the future exercise of such rights may adversely affect the market price of our Class A ordinary shares.*
Pursuant to an agreement to be entered at or after
the time of our initial business combination, our initial shareholders, the underwriters and their permitted transferees can demand that
we register the Class A ordinary shares into which founder shares are convertible, holders of our private placement units, private placement
shares, restricted private placement shares, private placement warrants and their permitted transferees can demand that we register the
private placement units, private placement shares, restricted private placement shares, private placement warrants and the Class A ordinary
shares issuable upon exercise of the private placement warrants and holders of warrants that may be issued upon conversion of working
capital loans may demand that we register such shares, warrants or the Class A ordinary shares issuable upon conversion of such warrants.
The registration rights will be exercisable with respect to the founder shares and the private placement units, private placement shares,
restricted private placement shares, private placement warrants and the Class A ordinary shares issuable upon exercise of such private
placement warrants.
We will bear the cost of registering these securities.
The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect
on the market price of our Class A ordinary shares. In addition, the existence of the registration rights may make our initial business
combination more costly or difficult to conclude. This is because the shareholders of the target business may increase the equity stake
they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our Class A ordinary
shares that is expected when the ordinary shares owned by our initial shareholders, holders of our restricted private placement shares,
holders of our private placement units or holders of our working capital units (if any) or their permitted transferees are registered
for resale.
**
*Members of our management team and board
of directors have significant experience as founders, board members, officers, executives or employees of other companies. Certain of
those persons have been, may be, or may become, involved in litigation, investigations or other proceedings, including related to those
companies or otherwise. The defense or prosecution of these matters could be time-consuming and could divert our managements attention,
and may have an adverse effect on us, which may impede our ability to consummate an initial business combination.*
During the course of their careers, members of
our management team and board of directors have had significant experience as founders, board members, officers, executives or employees
of other companies. As a result of their involvement and positions in these companies, certain of those persons have been, may be or may
in the future become involved in litigation, investigations or other proceedings, including relating to the business affairs of such companies,
transactions entered into by such companies, or otherwise. Individual members of our management team and board of directors also may become
involved in litigation, investigations or other proceedings involving claims or allegations related to or as a result of their personal
conduct, either in their capacity as a corporate officer or director or otherwise, and may be personally named in such actions and potentially
subject to personal liability. Any such liability may or may not be covered by insurance and/or indemnification, depending on the facts
and circumstances. The defense or prosecution of these matters could be time-consuming. Any litigation, investigations or other proceedings
and the potential outcomes of such actions may divert the attention and resources of our management team and board of directors away from
identifying and selecting a target business or businesses for our initial business combination and may negatively affect our reputation,
which may impede our ability to complete an initial business combination.
**
28
**
*We may issue additional Class A ordinary
shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial
business combination.*
Our amended and restated memorandum and articles
of association authorizes the issuance of up to 200,000,000 Class A ordinary shares, par value $0.0001 per share, 20,000,000 Class B ordinary
shares, par value $0.0001 per share, and 1,000,000 undesignated preference shares, par value $0.0001 per share. Immediately after our
initial public offering, there were 181,507,125 and 14,250,000 authorized but unissued Class A ordinary shares and Class B ordinary shares,
respectively, available for issuance, which amount does not take into account shares reserved for issuance upon exercise of outstanding
warrants, or shares reserved for issuance upon conversion of the Class B ordinary shares. Class B ordinary shares are convertible into
Class A ordinary shares, initially at a one-for-one ratio but subject to adjustment as set forth herein. There are currently no preference
shares issued and outstanding.
We may issue a substantial number of additional
Class A ordinary shares, and may issue preference shares, in order to complete our initial business combination or under an employee incentive
plan after completion of our initial business combination. We may also issue Class A ordinary shares to redeem public warrants. However,
our amended and restated memorandum and articles of association provide, among other things, that prior to our initial business combination,
we may not issue additional ordinary shares that would entitle the holders thereof to (1) receive funds from the trust account or (2)
vote as a class with our public shares on any initial business combination. The issuance of additional ordinary shares or preference shares:
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may significantly dilute the equity interest of investors in our initial public offering; | |
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may subordinate the rights of holders of ordinary shares if preference shares are issued with rights senior to those afforded our ordinary shares; | |
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could cause a change of control if a substantial number of our ordinary shares is issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present directors and officers; | |
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may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; | |
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may adversely affect prevailing market prices for our units, ordinary shares and/or public warrants; and | |
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may not result in adjustment to the exercise price of our warrants. | |
**
*Holders of our founder shares will control
the appointment of our board of directors until consummation of our initial business combination and will hold a substantial interest
in us. As a result, they will appoint all of our directors prior to our initial business combination and may exert a substantial influence
on actions requiring shareholder vote, potentially in a manner that you do not support.*
Our initial shareholders own approximately 25%
of our issued and outstanding ordinary shares (not including the Class A ordinary shares underlying the private placement units and the
restricted private placement shares). In addition, prior to our initial business combination, holders of the founder shares will have
the right to vote to appoint all of our directors and may remove members of the board of directors for any reason. Non-managing investors
will only be issued membership interests in our sponsor, with no right to control our sponsor or vote or dispose of any securities held
by our sponsor. Holders of our public shares will have no right to vote on the appointment of directors during such time; provided, however,
that if all of the founder shares are converted prior to the date of the initial business combination, the holders of our public shares
will have the right to vote on the election of directors. These provisions of our amended and restated memorandum and articles of association
may only be amended by a special resolution passed by a majority of at least 90% of our ordinary shares attending and voting in a general
meeting. As a result, you will not have any influence over the appointment of directors prior to our initial business combination.
Neither our initial shareholders nor, to our knowledge,
any of our directors or officers, have any current intention to purchase additional securities, other than as disclosed in this Annual
Report. Factors that would be considered in making such additional purchases would include consideration of the current trading price
of our Class A ordinary shares. In addition, as a result of their substantial ownership in our company, our initial shareholders may exert
a substantial influence on other actions requiring a shareholder vote, potentially in a manner that you do not support, including amendments
to our amended and restated memorandum and articles of association and approval of major corporate transactions.
In addition, our board of directors is comprised
of directors who will generally serve a three-year term. We may not hold an annual general meeting to appoint new directors prior to the
completion of our initial business combination, in which case all of the current directors will continue in office until at least the
completion of the business combination. If there is an annual general meeting, our sponsor and initial shareholders, because of their
beneficial ownership, will control the outcome, as only holders of our Class B ordinary shares will have the right to vote on the appointment
of directors and to remove directors prior to our initial business combination. Accordingly, holders of our founder shares will exert
significant influence over actions requiring a shareholder vote at least until the completion of our initial business combination.
**
29
**
*We may amend the terms of the warrants in
a manner that may be adverse to holders of public warrants with the approval by the holders of at least 50% of the then outstanding public
warrants.*
Our public warrants will be issued in registered
form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement
provides that (a) the terms of the public warrants may be amended without the consent of any holder for the purpose of (i) curing any
ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to the description of the terms of the
public warrants and the warrant agreement set forth in this Annual Report, or defective provision (ii) removing or reducing the Companys
ability to redeem the public warrants and, if applicable, a corresponding amendment to the Companys ability to redeem the private
placement warrants or (iii) adding or changing any provisions with respect to matters or questions arising under the warrant agreement
as the parties to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of
the registered holders of the public warrants under the warrant agreement in any material respect, (b) the terms of the warrants may be
amended with the vote or written consent of at least 50% of the then outstanding public warrants and private placement warrants, voting
together as a single class, to allow for the warrants to be or continue to be, as applicable, classified as equity in our financial statements
and (c) all other modifications or amendments to our warrant agreement with respect to (i) the public warrants require the vote or written
consent of holders of at least 50% of the then outstanding public warrants and (ii) the private placement warrants require the vote or
written consent of holders of at least 50% of the then outstanding private placement warrants. Accordingly, we may amend the terms of
the public warrants in a manner adverse to a holder of public warrants if holders of at least 50% of the then outstanding public warrants
approve of such amendment. Although our ability to amend the terms of the public warrants with the consent of at least 50% of the then
outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise
price of the warrants, shorten the exercise period or decrease the number of ordinary shares purchasable upon exercise of a warrant.
**
*Our warrant agreement designates the courts
of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for
certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders
to obtain a favorable judicial forum for disputes with our company.*
Our warrant agreement provides that, subject to
applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement, including
under the Securities Act, will be brought and enforced in the courts of the State of New York or the United States District Court for
the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction, which jurisdiction shall be the exclusive
forum for any such action, proceeding or claim. We will waive any objection to such exclusive jurisdiction and that such courts represent
an inconvenient forum.
Notwithstanding the foregoing, these provisions
of the warrant agreement do not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim
for which the federal district courts of the United States of America are the sole and exclusive forum. Any person or entity purchasing
or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and to have consented to the forum provisions
in our warrant agreement. If any action, the subject matter of which is within the scope the forum provisions of the warrant agreement,
is filed in a court other than a court of the State of New York or the United States District Court for the Southern District of New York
(a foreign action) in the name of any holder of our warrants, such holder shall be deemed to have consented to: (x) the
personal jurisdiction of the state and federal courts located in the State of New York in connection with any action brought in any such
court to enforce the forum provisions (an enforcement action), and (y) having service of process made upon such warrant
holder in any such enforcement action by service upon such warrant holders counsel in the foreign action as agent for such warrant
holder. This choice-of-forum provision may limit a warrant holders ability to bring a claim in a judicial forum that it finds favorable
for disputes with our company, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our warrant
agreement inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional
costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial
condition and results of operations and result in a diversion of the time and resources of our management and board of directors.
**
*Unlike some other similarly structured blank
check companies, our initial shareholders will beneficially own 25% of our issued and outstanding ordinary shares.*
Our initial shareholders beneficially own approximately
25% of our issued and outstanding ordinary shares. This is different than some other similarly situated bank check companies in which
the initial shareholders will only be issued an aggregate of 20% of the total number of shares to be outstanding prior to the initial
business combination.
**
**
30
**
*We may redeem your unexpired public warrants
prior to their exercise at a time that is disadvantageous to you, thereby making your public warrants worthless.*
We have the ability to redeem outstanding warrants
at any time after they become exercisable and prior to their expiration, at a price of $0.01 per public warrant if, among other things,
the last reported sale price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted to the number of shares issuable
upon exercise or the exercise price of a public warrant) for any 20 trading days within a 30 trading-day period ending on the third trading
day prior to the date on which we send the notice of redemption to the warrant holders. If and when the public warrants become redeemable
by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all
applicable state securities laws. As a result, we may redeem the public warrants as set forth above even if the holders are otherwise
unable to exercise the public warrants. Redemption of the issued and outstanding public warrants could force you to: (1) exercise your
public warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so; (2) sell your public warrants
at the then-current market price when you might otherwise wish to hold your public warrants; or (3) accept the nominal redemption price
which, at the time the outstanding public warrants are called for redemption, we expect would be substantially less than the market value
of your public warrants.
**
*Our managements ability to require
holders of our public warrants to exercise such public warrants on a cashless basis will cause holders to receive fewer Class A ordinary
shares upon their exercise of the public warrants than they would have received had they been able to exercise their public warrants for
cash.*
If we call our public warrants for redemption
after the redemption criteria described elsewhere in this Annual Report has been satisfied, our management will have the option to require
any holder that wishes to exercise its public warrants (including any public warrants held by our sponsor, officers, directors or their
permitted transferees) to do so on a cashless basis. If our management chooses to require holders to exercise their public warrants on
a cashless basis, the number of Class A ordinary shares received by a holder upon exercise will be fewer than it would have been had such
holder exercised their public warrants for cash. This will have the effect of reducing the potential upside of the holders
investment in us.
**
*Our warrants, founder shares, private placement
units and restricted private placement shares may have an adverse effect on the market price of our Class A ordinary shares and make it
more difficult to effectuate our initial business combination.*
We issued public warrants to purchase
8,625,000 Class A ordinary shares at a price of $11.50 per whole share (subject to adjustments as provided in the registration
statement) as part of the units offered by this Annual Report and, also issued in a private placement an aggregate of 672,875
private placement units, which include private placement warrants to purchase an aggregate of 336,438 Class A ordinary shares at
$11.50 per share, in addition to 570,000 restricted private placement shares. Our initial shareholders currently hold 5,750,000
Class B ordinary shares. The Class B ordinary shares are convertible into Class A ordinary shares on a one-for-one basis, subject to
adjustment as set forth herein. In addition, if our sponsor, any of its affiliates or certain of our directors and officers make any
working capital loans, up to $1,500,000 of such loans may be converted into private placement units, at the price of $10.00 per unit
at the option of the lender. To the extent we issue Class A ordinary shares to effectuate a business combination, the potential for
the issuance of a substantial number of additional Class A ordinary shares upon exercise of these warrants or conversion rights
could make us a less attractive acquisition vehicle to a target business. Any such issuance will increase the number of issued and
outstanding Class A ordinary shares and reduce the value of the Class A ordinary shares issued to complete the business combination.
Therefore, our warrants and founder shares may make it more difficult to effectuate a business combination or increase the cost of
acquiring the target business.
The private placement warrants are identical to
the warrants sold as part of the units in our initial public offering except that: (1) they will not be redeemable by us; (2) they (including
the Class A ordinary shares issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred,
assigned or sold until 30 days after the completion of our initial business combination; (3) they may be exercised by the holders on a
cashless basis and (4) they (including the ordinary shares issuable upon exercise of these warrants) are entitled to registration rights.
In addition, with respect to private placement warrants held by the underwriters and/or their designees, such private placement warrants
will be subject to the lock-up and registration rights limitations imposed by FINRA Rule 5110 and will not be exercisable more than five
years from the commencement of sales in our initial public offering in accordance with FINRA Rule 5110(g)(8).
**
**
31
**
*Because each unit contains one-half of one
public warrant and only a whole public warrant may be exercised, the units may be worth less than units of other blank check companies.*
Each unit contains one-half of one public warrant.
Pursuant to the warrant agreement, no fractional public warrants will be issued upon separation of the units, and only whole public warrants
will trade. This is different from other offerings similar to ours whose units include one ordinary share and one whole public warrant
to purchase one share. We have established the components of the units in this way in order to reduce the dilutive effect of the public
warrants upon completion of a business combination since the public warrants will be exercisable in the aggregate for a third of the number
of shares compared to units that each contain a whole public warrant to purchase one whole share, thus making us, we believe, a more attractive
business combination partner for target businesses. Nevertheless, this unit structure may cause our units to be worth less than if they
included a public warrant to purchase one whole share.
**
*A provision of our warrant agreement may
make it more difficult for us to consummate an initial business combination. Unlike many blank check companies, if:*
|
|
(1) |
we issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per ordinary share; | |
|
|
(2) |
the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the completion of our initial business combination (net of redemptions); and | |
|
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(3) |
the Market Value is below $9.20 per share, | |
then the exercise price of the warrants will be
adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and, in the case of the public warrants only,
the $18.00 per share redemption trigger prices described in the registration statement will be adjusted (to the nearest cent) to be equal
to 180% of the higher of the Market Value and the Newly Issued Price. This may make it more difficult for us to consummate an initial
business combination with a target business.
**
*Because we are incorporated under the laws
of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S.
federal courts may be limited.*
We are an exempted company incorporated under
the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service of process within the United States upon
our directors or officers, or enforce judgments obtained in the United States courts against our directors or officers.
Our corporate affairs will be governed by our
amended and restated memorandum and articles of association, the Companies Act (as the same may be supplemented or amended from time to
time) and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders
and the fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of
the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman
Islands as well as from English common law, the decisions of whose courts are of persuasive authority, but are not binding on a court
in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are
different from what they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the
Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have
more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to
initiate a shareholders derivative action in a federal court of the United States.
The courts of the Cayman Islands are unlikely
(1) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the
federal securities laws of the United States or any state; and (2) in original actions brought in the Cayman Islands, to impose liabilities
against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as
the liabilities imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in
the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money
judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent
foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions
are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated
sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter,
impeachable on the grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice
or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy).
A Cayman Islands Court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.
As a result of all of the above, public shareholders
may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or
controlling shareholders than they would as public shareholders of a United States company.
**
**
32
**
*Provisions in our amended and restated memorandum
and articles of association may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future
for our Class A ordinary shares and could entrench management.*
Our amended and restated memorandum and articles
of association contain provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best
interests. These provisions include three-year director terms and the ability of the board of directors to designate the terms of and
issue new series of preference shares, which may make more difficult the removal of management and may discourage transactions that otherwise
could involve payment of a premium over prevailing market prices for our securities.
Risks Relating to our sponsor and Management
Team
**
*Past performance by our management team
and their affiliates may not be indicative of future performance of an investment in the company.*
Information regarding performance by our management
team and their affiliates is presented for informational purposes only. Past performance by our management team and their affiliates is
not a guarantee either (1) that we will be able to identify a suitable candidate for our initial business combination or (2) of success
with respect to any business combination we may consummate. You should not rely on the historical record of our management team or their
affiliates or any related investments performance as indicative of our future performance of an investment in the company or the
returns the company will, or is likely to, generate going forward.
**
*Our directors and officers will allocate
their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs.
This conflict of interest could have a negative impact on our ability to complete our initial business combination.*
Our directors and officers are not required to,
and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations
and our search for a business combination and their other businesses. We do not intend to have any full-time employees prior to the completion
of our initial business combination. Our officers are engaged in several other business endeavors for which they may be entitled to substantial
compensation and our officers are not obligated to contribute any specific number of hours per week to our affairs. Certain of our independent
directors also serve as officers and board members for other entities. If our officers and directors other business affairs
require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their
ability to devote time to our affairs, which may have a negative impact on our ability to complete our initial business combination.
**
*We are dependent upon our directors and
officers and their departure could adversely affect our ability to operate.*
Our operations are dependent upon a relatively
small group of individuals and in particular, Kanishka Roy, our Chairman and Chief Executive Officer, and Steven Handwerker, our Chief
Financial Officer and Director. We believe that our success depends on the continued service of our directors and officers, at least until
we have completed our initial business combination. In addition, our directors and officers are not required to commit any specified amount
of time to our affairs and, accordingly, will have conflicts of interest in allocating their time among various business activities, including
identifying potential business combinations and monitoring the related due diligence. We do not have an employment agreement with, or
key-man insurance on the life of, any of our directors or officers. The unexpected loss of the services of one or more of our directors
or officers could have a detrimental effect on us.
**
*Our ability to successfully effect our initial
business combination and to be successful thereafter will be dependent upon the efforts of our key personnel, some of whom may join us
following our initial business combination. The loss of our or a targets key personnel could negatively impact the operations and
profitability of our post-combination business.*
Our ability to successfully effect our initial
business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target business, however,
cannot presently be ascertained. Although some of our key personnel may remain with the target business in senior management or advisory
positions following our initial business combination, it is likely that some or all of the management of the target business will remain
in place. While we intend to closely scrutinize any individuals we engage after our initial business combination, we cannot assure you
that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the requirements of operating
a company regulated by the SEC, which could cause us to have to expend time and resources helping them become familiar with such requirements.
In addition, the directors and officers of an
acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination targets
key personnel could negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidates
key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that
certain members of an acquisition candidates management team will remain associated with the acquisition candidate following our
initial business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place.
The loss of key personnel could negatively impact the operations and profitability of our post-combination business.
**
**
33
**
*Our key personnel may negotiate employment
or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for
them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest
in determining whether a particular business combination is the most advantageous.*
Our key personnel may be able to remain with the
company after the completion of our initial business combination only if they are able to negotiate employment or consulting agreements
in connection with the business combination. Such negotiations would take place simultaneously with the negotiation of the business combination
and could provide for such individuals to receive compensation in the form of cash payments and/or our securities for services they would
render to us after the completion of our initial business combination. The personal and financial interests of such individuals may influence
their motivation in identifying and selecting a target business, subject to his or her fiduciary duties under Cayman Islands law. However,
we believe the ability of such individuals to remain with us after the completion of our initial business combination will not be the
determining factor in our decision as to whether or not we will proceed with any potential business combination. There is no certainty,
however, that any of our key personnel will remain with us after the completion of our initial business combination. We cannot assure
you that any of our key personnel will remain in senior management or advisory positions with us. The determination as to whether any
of our key personnel will remain with us will be made at the time of our initial business combination.
**
*Certain of our directors and officers are
now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be
conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should
be presented.*
Until we consummate our initial business combination,
we intend to engage in the business of identifying and combining with one or more businesses. Our sponsor and directors and officers are,
or may in the future become, affiliated with entities that are engaged in a similar business. For example, Kanishka Roy, our Chairman
and Chief Executive Officer, currently serves as Chairman, President and CEO of Plum Acquisition Corp. III, and is also the manager of
Mercury Capital, its sponsor, and Steven Handwerker, our Chief Financial Officer and Director, currently serves as CFO of Plum Acquisition
Corp. III. Our sponsor and directors and officers are also not prohibited from sponsoring, or otherwise becoming involved with, any other
blank check companies prior to us completing our initial business combination.
Our directors and officers also may become aware
of business opportunities which may be appropriate for presentation to us and the other entities to which they owe certain fiduciary or
contractual duties. Accordingly, they may have conflicts of interest in determining to which entity a particular business opportunity
should be presented. These conflicts may not be resolved in our favor and a potential target business may be presented to other entities
prior to its presentation to us, subject to his or her fiduciary duties under Cayman Islands law. Our amended and restated memorandum
and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or
an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly
in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being
offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or
officer, on the one hand, and us, on the other.
**
*Our directors, officers, security holders
and their respective affiliates may have competitive pecuniary interests that conflict with our interests.*
We have not adopted a policy that expressly prohibits
our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in any investment
to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may enter into a business
combination with a target business that is affiliated with either of our sponsor and our directors or officers, although we do not intend
to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in business activities
of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.
Affiliates of our sponsor have invested in a diverse
set of industries. As a result, there may be substantial overlap between companies that would be a suitable business combination for us
and companies that would make an attractive target for such other affiliates.
In addition, members of our management team and
our board of directors directly or indirectly own founder shares, and, accordingly, may have a conflict of interest in determining whether
a particular target business is an appropriate business with which to effectuate our initial business combination.
**
**
34
**
*We may engage in a business combination
with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, our non-managing investors,
and our directors or officers which may raise potential conflicts of interest.*
In light of the involvement of our directors and
officers with other entities, we may decide to acquire one or more businesses affiliated with our sponsor, our non-managing investors,
and our directors and officers. Certain of our directors and officers also serve as officers and board members for other entities. Such
entities may compete with us for business combination opportunities. Our sponsor, our directors and officers are not currently aware of
any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and there
have been no preliminary discussions concerning a business combination with any such entity or entities. Although we will not be specifically
focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined that such
affiliated entity met our criteria and guidelines for a business combination and such transaction was approved by a majority of our independent
and disinterested directors. Despite our agreement that we, or a committee of independent and disinterested directors, will obtain an
opinion from an independent investment banking firm that is a member of FINRA or from a valuation or appraisal firm, regarding the fairness
to our company from a financial point of view of a business combination with one or more domestic or international businesses affiliated
with our sponsor, our non-managing investors, and our directors or officers, potential conflicts of interest still may exist and, as a
result, the terms of the business combination may not be as advantageous to our public shareholders as they would be absent any conflicts
of interest.
**
*Since our sponsor, officers and directors
and any other holder of our founder shares, including any non-managing investor, and the underwriters will lose their entire investment
in us if our initial business combination is not completed (other than with respect to any public shares they may acquire), and because
our sponsor, officers and directors and any other holder of our founder shares, including any non-managing investor, directly or indirectly
may profit substantially from a business combination as a result of their ownership of founder shares even under circumstances where our
public shareholders would experience losses in connection with their investment, a conflict of interest may arise in determining whether
a particular business combination target is appropriate for our initial business combination, including in connection with the shareholder
vote in respect thereto.*
On June 26, 2024, our sponsor paid $25,000, or
approximately $0.003 per share, to cover certain of our offering and formation costs in exchange for an aggregate of 7,665,900 founder
shares. Prior to this initial investment in us by our sponsor, we had no assets, tangible or intangible. During July and August 2024,
our sponsor transferred 25,000 founder shares to each of our independent directors (an aggregate of 75,000 founder shares) at their original
purchase price. On December 6, 2024, our sponsor surrendered 1,915,900 founder shares for no consideration. Our initial shareholders currently
hold an aggregate of 5,750,000 founder shares.
Our initial shareholders collectively beneficially
own approximately 25% of our issued and outstanding shares (not including the Class A ordinary shares underlying the private placement
units and the restricted private placement shares). The founder shares will be worthless if we do not complete an initial business combination.
In addition, our sponsor purchased an aggregate
of 440,000 private placement units and 570,000 restricted private placement shares at a price of $10.00 per private placement unit or
a combined price of $10.00 per non-managing investor private placement security, as applicable, or $4,400,000 in the aggregate, in a private
placement that closed simultaneously with the closing of our initial public offering. The underwriters committed to use a portion of their
underwriting discount and commission to purchase an aggregate of 232,875 private placement units at a price of $10.00 per unit, or $2,328,750
in the aggregate, in said private placement.
35
The non-managing investors have purchased, indirectly
through the purchase of non-managing sponsor membership interests, an aggregate of 285,000 private placement units and 570,000 restricted
private placement shares at a combined price of $10.00 per non-managing investor private placement security ($2,850,000 in the aggregate)
in a private placement that closed simultaneously with the closing of our initial public offering. The non-managing investors paid no
additional consideration for the restricted private placement shares, which allowed them to invest in our company on more favorable terms
than other investors. Subject to each non-managing investor purchasing, through an investment in our sponsor, the non-managing investor
private placement securities allocated to it in connection with the closing of our initial public offering, our sponsor issued membership
interests at a nominal purchase price to the non-managing investors reflecting interests in an aggregate of 2,280,000 founder shares held
by our sponsor.
Given the differential in the purchase price paid
for the founder shares as compared to our initial public offering price of the public shares and the substantial number of Class A ordinary
shares that holders of our founder shares would receive upon conversion of the founder shares upon a business combination, the founder
shares may have significant value after the business combination even if our Class A ordinary shares trade below our initial public offering
price and holders of our public shares have a substantial loss on their investment. Our initial shareholders have agreed (A) to vote any
shares owned by them in favor of any proposed business combination and (B) not to redeem any founder shares in connection with a shareholder
vote to approve a proposed initial business combination. In addition, we may obtain loans from either of our sponsor, any of its affiliates
or certain of our directors and officers. The non-managing investors are not required to (i) hold any units, Class A ordinary shares or
public warrants they may purchase in our initial public offering or thereafter for any amount of time, (ii) vote any Class A ordinary
shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to
redeem their public shares at the time of our initial business combination. The non-managing investors will have the same rights to the
funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in our initial public
offering as the rights afforded to our other public shareholders. However, if the non-managing investors purchase all of the units for
which they have expressed to us an interest in purchasing or otherwise hold a substantial number of our units, then the non-managing investors
will potentially have different interests than our other public shareholders in approving our initial business combination and otherwise
exercising their rights as public shareholders because of their indirect ownership of founder shares as further discussed in this Annual
Report. The non-managing investors will share in any appreciation of the founder shares and restricted private placement shares through
their membership interests in our sponsor if we successfully complete a business combination. Accordingly, non-managing investors
interests in the founder shares and restricted private placement shares owned by them indirectly through their membership interests in
our sponsor may provide them with an incentive to vote any public shares they own in favor of a business combination, and make a substantial
profit on such interests, even if the business combination is with a target that ultimately declines in value and is not profitable for
other public shareholders. Further, in light of the non-managing investors interests in the founder shares, private placement units
and restricted private placement shares, in the event we pursue an initial business combination with a company that is affiliated with
one or more non-managing investors, such non-managing investors would have a conflict of interest in approving such initial business combination.
The personal and financial interests of our sponsor
and our directors and officers and any holders of our founder shares or our private placement securities may influence their motivation
in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of
the business following the initial business combination and may result in a misalignment of interests between the holders of our founder
shares, including any non-managing investors, and our officers and directors, on the one hand, and our public shareholders, on the other.
These risks may become more acute as the deadline to complete our initial business combination nears. In particular, because the founder
shares were purchased at a purchase price of approximately $0.003 per share, the holders of our founder shares, including any non-managing
investors, and certain of our directors and officers that directly or indirectly own founder shares) could make a substantial profit after
our initial business combination even if our public shareholders lose money on their investment as a result of a decrease in the post-combination
value of their Class A ordinary shares (after accounting for any adjustments in connection with an exchange or other transaction contemplated
by the business combination). For example, a holder of 1,000 founder shares would have paid approximately $3.00 to purchase such shares.
At the time of an initial business combination, such holder would be able to convert such founder shares into 1,000 Class A ordinary shares,
and would receive the same consideration in connection with our initial business combination as a public shareholder for the same number
of Class A ordinary shares. If the trading price of our Class A ordinary shares on a post-combination basis (after accounting for any
adjustments in connection with an exchange or other transaction contemplated by the business combination) were to decrease to $5.00 per
Class A ordinary share, such holder of our founder shares would obtain a profit of approximately $4,997 on account of the 1,000 founder
shares that the holder had converted into Class A ordinary shares in connection with the initial business combination. By contrast, a
public shareholder holding 1,000 Class A ordinary shares acquired in our initial public offering would lose approximately $5,000 in connection
with the same transaction.
Further, each of our officers and directors may
have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers
and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination.
36
**
*The nominal purchase price paid by our sponsor
and certain of our independent directors for the founder shares may result in significant dilution to the implied value of your public
shares upon the consummation of our initial business combination.*
We sold our units at an offering price of $10.00
per unit and the amount in our trust account is initially $10.10 per public share, implying an initial value of $10.10 per public share.
However, prior to our initial public offering, our sponsor, and certain of our independent directors paid a nominal aggregate purchase
price of $25,000 for the founder shares, or approximately $0.003 per share. As a result, the value of your public shares may be significantly
diluted upon the consummation of our initial business combination, when the founder shares are converted into public shares. For example,
the following table shows the dilutive effect of the founder shares on the implied value of the public shares upon the consummation of
our initial business combination, assuming that our equity value at that time is $145,500,000 which is the amount we would have for our
initial business combination in the trust account after payment of up to $6,000,000 of deferred underwriting commissions, assuming the
underwriters over-allotment option was not exercised, no interest is earned on the funds held in the trust account, and no public
shares are redeemed in connection with our initial business combination, and without taking into account any other potential impacts on
our valuation at such time, such as the trading price of our public shares, the business combination transaction costs, any equity issued
or cash paid to the targets sellers or other third parties, or the targets business itself, including its assets, liabilities,
management and prospects, as well as the value of our public and private warrants. At such valuation, each of our ordinary shares would
have an implied value of $6.86 per share upon consummation of our initial business combination, which would be an approximate 32.1% decrease
as compared to the initial implied value per public share of $10.10.
**
*We may approve an amendment or waiver of
the letter agreement that would allow our sponsor to directly, or members of our sponsor to indirectly, transfer founder shares and private
placement units in a transaction in which the sponsor removes itself as our sponsor before identifying a business combination, which may
deprive us of key personnel.*
While there is no current intention to do so,
and the members of our management team and sponsor have not done so with any previously formed special purpose acquisition companies,
we may approve an amendment or waiver of the letter agreement that would allow the sponsor to directly, or members of our sponsor to indirectly,
transfer founder shares and private placement units in a transaction in which the sponsor removes itself as our sponsor before identifying
a business combination. As a result, there is a risk that our sponsor and our officers and directors may divest their ownership or economic
interests in us or in our sponsor, which would likely result in our loss of certain key personnel, including Kanishka Roy and Steven Handwerker.
There can be no assurance that any replacement sponsor or key personnel will successfully identify a business combination target for us,
or, even if one is so identified, successfully complete such business combination.
**
*Our management may not be able to maintain
control of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of a target
business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.*
If we are unable to complete the proposed Business
Combination with Bolt Threads, may structure our initial business combination so that the post-transaction company in which our public
shareholders own shares will own less than 100% of the equity interests or assets of a target business, but we will complete such business
combination only if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target
or otherwise acquires a controlling interest in the target business sufficient for us not to be required to register as an investment
company under the Investment Company Act. We will not consider any transaction that does not meet such criteria. Even if the post-transaction
company owns 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively
own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in our initial
business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new ordinary shares
in exchange for all of the issued and outstanding capital stock, shares or other equity securities of a target. In this case, we would
acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of new ordinary shares, our shareholders
immediately prior to such transaction could own less than a majority of our issued and outstanding ordinary shares subsequent to such
transaction. In addition, other minority shareholders may subsequently combine their holdings resulting in a single person or group obtaining
a larger share of the companys shares than we initially acquired. Accordingly, this may make it more likely that our management
will not be able to maintain our control of the target business.
**
*Our initial business combination will require
approval of a majority of our board of directors, as well as a majority of our independent directors.*
Pursuant to our amended and restated memorandum
and articles of association, our initial business combination will require the approval of a majority of our board of directors and, under
Nasdaq rules, our initial business combination will also require the approval of a majority of our independent directors. Unless we receive
the requisite board member approvals, we will not be able to enter into a definitive merger or similar agreement relating to our initial
business combination.
37
Risks Associated with Acquiring and Operating
a Business in Foreign Countries
**
*If we are unable to complete the proposed
business combination with Bolt Threads and our management team pursues a company with operations or opportunities outside of the United
States for our initial business combination, we may face additional burdens in connection with investigating, agreeing to and completing
such combination, and if we effect such initial business combination, we would be subject to a variety of additional risks that may negatively
impact our operations.*
If our management team pursues a company with
operations or opportunities outside of the United States for our initial business combination, we would be subject to risks associated
with cross-border business combinations, including in connection with investigating, agreeing to and completing our initial business combination,
conducting due diligence in a foreign market, having such transaction approved by any local governments, regulators or agencies and changes
in the purchase price based on fluctuations in foreign exchange rates.
If we effect our initial business combination
with such a company, we would be subject to any special considerations or risks associated with companies operating in an international
setting, including any of the following:
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costs and difficulties inherent in managing cross-border business operations and complying with commercial and legal requirements of overseas markets; | |
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rules and regulations regarding currency redemption; | |
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complex corporate withholding taxes on individuals; | |
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laws governing the manner in which future business combinations may be effected; | |
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tariffs and trade barriers; | |
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regulations related to customs and import/export matters; | |
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longer payment cycles; | |
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tax consequences, such as tax law changes, including termination or reduction of tax and other incentives that the applicable government provides to domestic companies, and variations in tax laws as compared to the United States; | |
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currency fluctuations and exchange controls; | |
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rates of inflation; | |
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challenges in collecting accounts receivable; | |
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cultural and language differences; | |
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employment regulations; | |
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crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars; | |
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deterioration of political relations with the United States; | |
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obligatory military service by personnel; and | |
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government appropriation of assets. | |
We may not be able to adequately address these
additional risks. If we were unable to do so, we may be unable to complete such combination or, if we complete such combination, our operations
might suffer, either of which may adversely impact our results of operations and financial condition.
**
*If our management following our initial
business combination is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws,
which could lead to various regulatory issues.*
Following our initial business combination, any
or all of our management could resign from their positions as officers of the company, and the management of the target business at the
time of the business combination could remain in place. Management of the target business may not be familiar with U.S. securities laws.
If new management is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws.
This could be expensive and time-consuming and could lead to various regulatory issues which may adversely affect our operations.
38
General Risk Factors
**
*We have a working capital deficiency and
a weak cash position.*
As of December 31, 2025, we had $296,249 in cash and working capital
deficit of $70,710. Further, we expect to incur significant costs in pursuit of our acquisition plans. Our plans to raise capital and
to consummate our initial business combination may not be successful.
**
*You will not be entitled to protections
normally afforded to investors of many other blank check companies.*
Since the net proceeds of our initial public offering
are intended to be used to complete an initial business combination with a target business that has not been selected, we may be deemed
to be a blank check company under the U.S. securities laws. However, because we will have net tangible assets in excess
of $5,000,000 upon the successful completion of our initial public offering and will file a Current Report on Form 8-K, including an audited
balance sheet of the company demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check
companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things,
this means our units will be immediately tradable.
**
*Changes in laws or regulations, or a failure
to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial
business combination, and results of operations.*
We are subject to laws and regulations enacted
by national, regional and local governments. In particular, we will be required to comply with certain SEC and other legal requirements.
Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations
and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our
business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted
and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial business
combination, and results of operations.
On January 24, 2024, the SEC adopted a series
of new rules relating to SPACs requiring, among other items, (i) additional disclosures relating to SPAC business combination transactions;
(ii) additional disclosures relating to dilution and to conflicts of interest involving sponsors and their affiliates in both SPAC initial
public offerings and SPAC initial business combinations; (iii) the use of projections by SPACs in SEC filings in connection with proposed
business combination transactions; and (iv) both the SPAC and the target companys status as co-registrants on de-SPAC transaction
registration statements. In addition, the SECs adopting release provided guidance describing circumstances in which a SPAC could
become subject to regulation under the Investment Company Act, including as a result of its duration, asset composition, business purpose,
and the activities of the SPAC and its management team in furtherance of such goals. Compliance with such rules and related guidance may
increase the costs and the time needed to negotiate and complete an initial business combination, may constrain the circumstances under
which we could complete an initial business combination or otherwise impair our ability to complete a business combination.
**
*We may not hold an annual general meeting
until after the consummation of our initial business combination.*
In accordance with Nasdaq corporate governance
requirements, we are not required to hold an annual general meeting until one year after our first fiscal year end following our listing
on Nasdaq. There is no requirement under the Companies Act for us to hold annual or extraordinary general meetings to appoint directors.
Until we hold an annual general meeting, public shareholders may not be afforded the opportunity to discuss company affairs with management.
**
**
39
**
*We may be a passive foreign investment company,
or PFIC, which could result in adverse U.S. federal income tax consequences to U.S. investors.*
As used herein, the term U.S. Holder
means a beneficial owner of units, ordinary shares or warrants who or that is for U.S. federal income tax purposes: (1) an individual
citizen or resident of the United States; (2) a corporation (or other entity treated as a corporation for U.S. federal income tax purposes)
that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the
District of Columbia; (3) an estate the income of which is subject to U.S. federal income taxation regardless of its source; or (4) a
trust if (A) a court within the United States is able to exercise primary supervision over the administration of the trust and one or
more U.S. persons have the authority to control all substantial decisions of the trust, or (B) it has in effect a valid election to be
treated as a U.S. person.
If we are a PFIC for any taxable year (or portion
thereof) that is included in the holding period of a U.S. Holder of our ordinary shares or warrants, the U.S. Holder may be subject to
adverse U.S. federal income tax consequences and may be subject to additional reporting requirements. Our PFIC status for our current
and subsequent taxable years may depend upon the status of an acquired company pursuant to a business combination and whether we qualify
for the PFIC start-up exception. Depending on the particular circumstances, the application of the start-up exception may be subject to
uncertainty, and there cannot be any assurance that we will qualify for the start-up exception. Accordingly, there can be no assurances
with respect to our status as a PFIC for our current taxable year or any subsequent taxable year. Our actual PFIC status for any taxable
year, moreover, will not be determinable until after the end of such taxable year(and if the start-up exception may be applicable, potentially
not until after the two taxable years following). Moreover, if we determine we are a PFIC for any taxable year, we will endeavor upon
written request to provide to a U.S. Holder such information as the Internal Revenue Service (IRS) may require, including
a PFIC Annual Information Statement, in order to enable the U.S. Holder to make and maintain a qualified electing fund election,
but there can be no assurance that we will timely provide such required information, and such election would likely be unavailable with
respect to our warrants in all cases. We urge U.S. Holders to consult their tax advisors regarding the possible application of the PFIC
rules to holders of our ordinary shares and warrants.
**
*If a U.S. person is treated as owning at
least 10% of our stock, such person may be subject to adverse U.S. federal income tax consequences.*
If a U.S. Holder is treated as owning (directly,
indirectly or constructively) at least 10% of the value or voting power of our stock, such holder may be treated as a United States
shareholder with respect to us if we are a controlled foreign corporation, (CFC), for U.S. federal
income tax purposes. A non-U.S. corporation is considered a CFC if more than 50% of (1) the total combined voting power of all classes
of stock of such corporation entitled to vote, or (2) the total value of the stock of such corporation is owned, or is considered as owned
by applying certain constructive ownership rules, by 10% United States shareholders on any day during the taxable year of
such non-U.S. corporation.
If we are a CFC, 10% United States shareholders
will be subject to adverse income inclusion and reporting requirements with respect to us. No assurance can be provided that we will assist
holders in determining whether we are treated as a CFC or whether any holder is treated as a 10% United States shareholder
with respect to us or furnish to any holder information that may be necessary to comply with reporting and tax payment obligations with
respect to our status as a CFC.
**
*We may reincorporate in another jurisdiction
in connection with our initial business combination and such reincorporation may result in taxes imposed on shareholders or warrant holders.*
We may, subject to requisite shareholder approval
by special resolution under our amended and restated memorandum and articles of association, effect a business combination with a target
company in another jurisdiction, reincorporate in the jurisdiction in which the target company or business is located, or reincorporate
in another jurisdiction. Such transactions may result in tax liability for a shareholder or warrant holder in the jurisdiction in which
the shareholder or warrant holder is a tax resident (or in which its members are resident if it is a tax transparent entity), in which
the target company is located, or in which we reincorporate. In the event of a reincorporation pursuant to our initial business combination,
such tax liability may attach prior to the consummation of redemptions of any of our public shares properly submitted to us for redemption
in connection with such business combination. We do not intend to make any cash distributions to shareholders to pay such taxes. Shareholders
or warrant holders may be subject to withholding taxes or other taxes with respect to their ownership of us after the reincorporation.
**
**
40
**
*If our initial business combination involves
a company organized under the laws of the United States (or any subdivision thereof), a U.S. federal excise tax could be imposed on us
in connection with any redemptions of our Class A ordinary shares after or in connection with such initial business combination.*
The Inflation Reduction Act of 2022 provides for,
among other things, a new 1% U.S. federal excise tax on certain repurchases (including redemptions) of stock by publicly traded U.S. corporations
after December 31, 2022 (the stock buyback tax), subject to certain exceptions. If applicable, the amount of the stock buyback
tax is generally 1% of the aggregate fair market value of any stock repurchased by the corporation during a taxable year, net of the aggregate
fair market value of certain new stock issuances by the repurchasing corporation during the same taxable year. The Biden administration
has proposed increasing the stock buyback tax rate from 1% to 4%; however, it is unclear whether such a change will be enacted and, if
enacted, how soon it could take effect. In addition, the U.S. Treasury Department and IRS have released preliminary guidance that would
potentially cause a non-U.S. corporations U.S. subsidiaries to be subject to the stock buyback tax with respect to any share repurchases
made by the non-U.S. corporation under certain circumstances.
As an entity incorporated as a Cayman Islands
exempted company, the stock buyback tax is currently not expected to apply to redemptions of our Class A ordinary shares (absent any regulations
or other additional guidance that may be issued in the future).However, in connection with an initial business combination involving a
company organized under the laws of the United States (or any subdivision thereof), it is possible that we domesticate and continue as
a Delaware corporation prior to certain redemptions. Because we expect that, following such a domestication, our securities would continue
to trade on Nasdaq, in such a case we could be subject to the stock buyback tax with respect to any subsequent redemptions (including
redemptions in connection with the initial business combination) that are treated as repurchases for this purpose. In all cases, whether
and to what extent we would be subject to the stock buyback tax will depend on a number of factors, including (i) the structure of the
initial business combination, including the extent to which the initial business combination involves a U.S. corporation and the extent
to which we issue shares in the initial business combination or otherwise during the same taxable year that are eligible to offset any
redemptions or other repurchases, (ii) the fair market value of the shares redeemed and (iii) the extent such redemptions could be treated
as dividends and not as repurchases. The applicability of the stock buyback tax to us could be further affected by the content of any
regulations, clarifications or other additional guidance from the U.S. Treasury Department that may be issued and applicable to the redemptions.
Any stock buyback tax that becomes payable as
a result of any redemptions of our Class A ordinary shares (or other shares into which such Class A ordinary shares may be converted)
in connection with our initial business combination or otherwise would be payable by us and not by the redeeming holder. To the extent
such taxes are applicable, the amount of cash available to pay redemptions or to transfer to the target business in connection with our
initial business combination may be reduced, which could result in our inability to meet conditions in the agreement relating to our initial
business combination related to a minimum cash requirement, if any, or otherwise result in the shareholders of the combined company (including
any of our shareholders who do not exercise their redemption rights in connection with the initial business combination) to economically
bear the impact of such stock buyback tax.
**
*We are an emerging growth company and a
smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements
available to emerging growth companies or smaller reporting companies, this could make our securities less attractive to investors and
may make it more difficult to compare our performance with other public companies.*
We are an emerging growth company
within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting
requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being
required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations
regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding
advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. As a result,
our shareholders may not have access to certain information they may deem important. We could be an emerging growth company for up to
five years, although circumstances could cause us to lose that status earlier, including if the market value of our ordinary shares held
by non-affiliates exceeds $700 million as of the end of any second quarter of a fiscal year, in which case we would no longer be an emerging
growth company as of the end of such fiscal year. We cannot predict whether investors will find our securities less attractive because
we will rely on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions,
the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities
and the trading prices of our securities may be more volatile.
41
Further, Section 102(b)(1) of the JOBS Act exempts
emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered
under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company
can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but
any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a
standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company,
can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our
financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has
opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards
used.
Additionally, we are a smaller reporting
company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure
obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting
company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates equals or exceeds
$250 million as of the end of that years second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during
such completed fiscal year and the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the
end of that years second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make
comparison of our financial statements with other public companies difficult or impossible.
**
*Since only holders of our founder shares
will have the right to vote on the appointment of directors, upon the listing of our shares, Nasdaq may consider us to be a controlled
company within the meaning of the Nasdaq rules and, as a result, we may qualify for exemptions from certain corporate governance
requirements.*
Only holders of our founder shares have the right
to vote on the appointment of directors. As a result, Nasdaq may consider us to be a controlled company within the meaning
of the Nasdaq corporate governance standards. Under the Nasdaq corporate governance standards, a company of which more than 50% of the
voting power is held by an individual, group or another company is a controlled company and may elect not to comply with
certain corporate governance requirements, including the requirements that:
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we have a board that includes a majority of independent directors, as defined under the rules of Nasdaq; | |
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we have a compensation committee of our board that is comprised entirely of independent directors with a written charter addressing the committees purpose and responsibilities; and | |
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a majority of the independent directors recommend director nominees for selection by the board of directors. | |
We do not intend to utilize these exemptions and
intend to comply with the corporate governance requirements of Nasdaq, subject to applicable phase-in rules. However, if we determine
in the future to utilize some or all of these exemptions, you will not have the same protections afforded to shareholders of companies
that are subject to all of the Nasdaq corporate governance requirements.
**
**
42
**
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
Although, as a blank check company, we do not have any operations, we are nonetheless subject to the risk of cybersecurity incidents. Among other things, the investments in our Trust Account and bank deposits may be vulnerable to such incidents, and we may depend on the digital technologies of third parties. We and third parties may be subject to cybersecurity attacks or security breaches. To the extent that we rely on the technologies of third parties, we depend upon the personnel and the processes of such third parties to protect against cybersecurity incidents, and we have no personnel or processes of our own for this purpose. In the event of a cybersecurity incident impacting us, our management team will report to the board of directors and provide updates on the management teams incident response plan for addressing and mitigating any risks associated with such an incident. As an early-stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences. We also lack sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have material adverse consequences on our business and lead to financial loss. We have not encountered any cybersecurity incidents since our initial public offering. In addition to our own cybersecurity risks, any proposed business combination target may have been subject to, or may in the future be subject to, cybersecurity incidents.
ITEM 2. PROPERTIES
We currently maintain our executive offices at
2021 Fillmore St. #2089, San Francisco, California 94115. We consider our current office space adequate for our current operations.
ITEM 3. LEGAL
PROCEEDINGS
There is no material litigation, arbitration or
governmental proceeding currently pending against us or any members of our management team in their capacity as such.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
43
PART II
ITEM 5. MARKET FOR REGISTRANTS COMMON
EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Our equity securities trade on Nasdaq. Each of
our units consists of one share of Class A ordinary shares and one-half of one redeemable warrant and, commencing on January 15, 2025,
trades on Nasdaq under the symbol PLMKU. The Class A ordinary shares and warrants underlying our units began trading separately
on Nasdaq under the symbols PLMK and PLMKW, respectively, on January 15, 2025.
Holders of Record
On March 25, 2026, there were 4 holders of
record of our units, 2 holders of record of our Class A ordinary shares, 4 holders of record of our Class B ordinary shares and 1
holder of record of our warrants. Such numbers do not include beneficial owners holding our securities through nominee names.
Dividends
We have not paid any cash dividends on our ordinary
shares to date and do not intend to pay cash dividends prior to the completion of our initial business combination. The payment of cash
dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition
subsequent to completion of our initial business combination. The payment of any cash dividends subsequent to our initial business combination
will be within the discretion of our board of directors at such time. Further, if we incur any indebtedness in connection with our initial
business combination, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.
Use of Proceeds from our Initial Public Offering
On January 16, 2025, we consummated our initial
public offering of 17,250,000 units , which included the full exercise of the underwriters over-allotment option at an offering
price of $10.00 per unit, generating total gross proceeds of $172,500,000. The securities sold in our initial public offering were registered
under the Securities Act on registration statement on Form S-1 (File No. 333-281144). The registration statement became effective on January
14, 2025. As of December 31, 2025, the amount held in the trust account was approximately $181,285,220.
ITEM 6. RESERVED
44
ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
*The following discussion and analysis of our
financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related
thereto which are included in Item 8. Financial Statements and Supplementary Data of this Annual Report. Certain information
contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially
from those anticipated in these forward-looking statements as a result of many factors, including those set forth under Cautionary
Note Regarding Forward-Looking Statements, Item 1A. Risk Factors and elsewhere in this Annual Report.*
Overview
We are a blank check company incorporated in the
Cayman Islands on June 10, 2024, formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization
or other similar business combination with one or more businesses. We intend to effectuate our business combination using cash derived
from the proceeds of the initial public offering and the sale of the private placement unit, our shares, debt or a combination of cash,
shares and debt.
We expect to continue to incur significant costs
in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a business combination will be successful.
Proposed Business Combination
**
*Business Combination Agreement*
On March 8, 2026, we entered into the Business
Combination Agreement by and among us, Plum IV Merger Sub, Inc., a Delaware corporation and our direct wholly owned subsidiary, and Controlled
Thermal Resources Holdings Inc., a Delaware corporation, pursuant to which, among other things and subject to the terms and conditions
contained therein, Merger Sub will merge with and into CTR, with CTR continuing as the surviving company. The combined companys
business is expected to continue to operate through CTR. The proposed Merger is expected to be consummated after receipt of the required
approvals by our shareholders and CTRs stockholders and the satisfaction or waiver of certain other customary conditions.
For more information about the Business Combination Agreement and the
Business Combination, see the section entitled *BusinessProposed Business Combination*.
*Transaction Support
Agreement*
Simultaneously with the
execution and delivery of the Business Combination Agreement, we and certain stockholders of CTR, who collectively have the right to cast
at least 60% of the votes entitled to be cast at a special meeting of CTRs stockholders entered into a Transaction Support Agreement,
pursuant to which the Supporting CTR Stockholders have agreed, among other things, to vote all of their shares of CTRs common stock
in favor of adopting and approving the Business Combination Agreement and the Business Combination.
*Registration Rights
Agreement*
In connection with the
Business Combination, simultaneously with the Closing, we and certain holders will enter into an Amended and Restated Registration Rights
Agreement that amends and restates the Registration Rights Agreement, dated January 14, 2025, by and among us, our sponsor and certain
other security holders named therein, pursuant to which, among other things, (i)we will agree to file, as soon as practicable (and
in any event within thirty (30) calendar days) following the closing date, a registration statement covering the resale of certain equity
securities held by the sponsor and such other securityholders parties thereto; and (ii)such holders of registrable securities will
be granted certain takedown, demand, block trade and piggyback registration rights with respect to their registrable securities, in each
case, on the terms and subject to the conditions set forth in the Amended and Restated Registration Rights Agreement.
45
*Lock-Up Agreement*
In connection with the
Business Combination, simultaneously with the Closing, we, our sponsor and certain stockholders of CTR will enter into a Lock-Up Agreement.
The Lock-Up Agreement will provide that, during the applicable Lock-Up Period (as defined in the Lock-Up Agreement), subject to certain
exceptions, the Lock-Up Parties will not, with respect to the Lock-Up Securities (as defined in the Lock-Up Agreement), (i) sell, offer
to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of,
directly or indirectly, or establish or increase a put equivalent position or liquidation with respect to or decrease a call equivalent
position, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences
of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii)
publicly announce the intention to effect any transaction specified in clause (i) or (ii).
July Promissory Note
On July 8, 2025, we issued an unsecured promissory
note in the principal amount of up to $1,500,000 to the sponsor which may be drawn down from time to time prior to the Maturity Date (as
defined below) upon our request. The July Note does not bear interest and the principal balance will be payable on the date on which we
consummate our initial business combination. In the event we consummate the business combination, the sponsor has the option on the Maturity
Date to convert the principal outstanding under the July Note into that number of ordinary shares of the post-business combination company.
The number of New PubCo Shares to be received by the sponsor in connection with such optional conversion will be an amount determined
by dividing (x) the sum of the outstanding principal amount (or portion thereof) payable to the sponsor by (y) $10.00. The July Note is
subject to customary events of default, the occurrence of certain of which automatically triggers the unpaid principal balance of the
July Note and all other sums payable with regard to the Note becoming immediately due and payable.
Results of Operations
We have neither engaged in any operations nor
generated any operating revenues to date. Our only activities for the year ended December 31, 2025 and for the period from June 10, 2024
(inception) through December 31, 2024 were organizational activities and those necessary to prepare for the initial public offering, described
below and, after our initial public offering, identifying a target company for a business combination. We do not expect to generate any
operating revenues until after the completion of our initial 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 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 year ended December 31, 2025, we had a
net income of $6,051,821, which consists of interest earned on investments held in Trust Account of $7,060,220 and interest earned on
operating account of $12,869, offset by general and administrative expenses of $1,021,268.
For the period from June 10, 2024 (inception)
through December 31, 2024, we had a net loss of $91,980, which consisted of formation and general and administrative expenses.
Liquidity and Capital Resources
As of December 31, 2025, we had cash of $296,249.
Until the consummation of the initial public offering, our only source of liquidity was an initial purchase of ordinary shares by the
sponsor and loans from our sponsor.
On January 16, 2025, we consummated the initial
public offering of 17,250,000 units, at a price of $10.00 per unit, which included the full exercise by the underwriters of their over-allotment
option in the amount of 2,250,000 units, generating gross proceeds of $172,500,000. Simultaneously with the closing of the initial public
offering, we consummated the sale of an aggregate of 672,875 private placement units to the sponsor at a price of $10.00 per private placement
unit generating gross proceeds of $6,728,750.
46
Following the initial public offering, on January
16, 2025, the full exercise of the over-allotment option, and the sale of the private placement units, a total of $174,225,000 was placed
in the trust account, and we had $971,550 of cash held outside of the trust account, after payment of costs related to the initial public
offering, and available for working capital purposes. We incurred $10,932,289 in transaction costs, including $3,450,000 of underwriting
fees, $6,900,000 of deferred underwriting fees and $582,289 of other offering costs.
For the year ended December 31, 2025, cash used
in operating activities was $869,506. Net income of $6,051,821 was affected by interest earned on investments held in trust account of
$7,060,220, compensation expense of $36,750 and payment of operation costs through promissory note of $8,550. Changes in operating assets
and liabilities provided $93,593 of cash for operating activities.
For the period from June 10, 2024 (inception)
through December 31, 2024, cash used in operating activities was $16,341. Net loss of $91,980 was affected by payment of operation costs
through promissory note of $20,820. Changes in operating assets and liabilities used $54,819 of cash for operating activities.
As of December 31, 2025, we had investments held
in the trust account of $181,285,220. We intend to use substantially all of the funds held in the trust account, including any amounts
representing interest earned on the trust account, which interest shall be net of taxes payable, to complete our business combination.
We may withdraw interest from the trust account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or
in part, as consideration to complete a 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 December 31, 2025, we had cash of $296,249
for working capital purpose. 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,
structure, negotiate and complete a business combination.
In order to fund working capital deficiencies
or finance transaction costs in connection with a 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 a business combination, we may repay such
loaned amounts out of the proceeds of the trust account released to us. In the event that a 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 units, at a price of $10.00 per unit, at the
option of the lender. The units would be identical to the private placement units.
On July 8, 2025, we issued an unsecured promissory
note (the Note) in the principal amount of up to $1,500,000 to the sponsor which may be drawn down from time to time prior
to the Maturity Date (as defined below) upon our request. The Note does not bear interest and the principal balance will be payable on
the date on which we consummate our initial business combination (the Maturity Date). In the event we consummate the business
combination, the sponsor has the option on the Maturity Date to convert the principal outstanding under the Note into that number of ordinary
shares of the post-business combination company (the New PubCo Shares). The number of New PubCo Shares to be received by
the sponsor in connection with such optional conversion will be an amount determined by dividing (x) the sum of the outstanding principal
amount (or portion thereof) payable to the sponsor by (y) $10.00. The Note is subject to customary events of default, the occurrence of
certain of which automatically triggers the unpaid principal balance of the Note and all other sums payable with regard to the Note becoming
immediately due and payable.
If our estimate of the costs of identifying a
target business, undertaking in-depth due diligence and negotiating a 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 initial 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.
47
Going Concern
As of December 31, 2025, we had $296,249 in cash
and working capital deficit of $70,710. Further, we have incurred and expect to continue to incur significant costs in pursuit of our
acquisition plans. There is no assurance that our plans to raise capital will be successful. In connection with our assessment of going
concern considerations in accordance with Accounting Standards Codification (ASC) Topic 205-40, Going Concern,
as of December 31, 2025, management has determined that mandatory liquidation, should a business combination not occur, and potential
subsequent dissolution and the liquidity issue raise substantial doubt about our ability to continue as a going concern for one year from
the date the financial statements are issued.
No adjustments have been made to the carrying
amounts of assets or liabilities should we be required to liquidate after July 16, 2026, or such earlier liquidation date as our board
of directors may approve to complete our initial business combination. We cannot assure that our plans to raise capital or to consummate
an initial business combination will be successful.
Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities,
which would be considered off-balance sheet arrangements as of December 31, 2025. 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. We have not entered into any off-balance sheet financing arrangements,
established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual Obligations
We do not have any long-term debt, excluding the
promissory note related party, capital lease obligations, operating lease obligations or long-term liabilities, other than an
agreement to pay each officer an aggregate of $20,833 per month, subject to availability of sufficient funds from working capital held
outside the trust account. We began incurring these fees on January 16, 2025, and will continue to incur these fees monthly until the
earlier of the completion of the business combination and our liquidation.
The underwriters were entitled to (1) an underwriting
discount of $0.20 per unit, or $3,450,000 in the aggregate, of which (i)$0.065 per unit was paid to the underwriters in cash at
the closing of the initial public offering and (ii)$0.135 per unit was used by the underwriters to purchase private placement units,
and (2) a deferred fee of $0.40perunit, or $6,900,000. 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
and will be based on the amount of funds remaining in the trust account after shareholder redemptions of public shares in connection with
the consummation of a business combination.
Critical Accounting Estimates and Policies
The preparation of 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 not identified any critical accounting policies.
Recent Accounting Standards
Management does not believe that any other recently
issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Not required for smaller reporting companies.
ITEM 8. FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
This information appears following Item 15 of
this Annual Report and is included herein by reference.
48
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls
and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange
Act is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms. Disclosure controls
and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our
reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer
and Chief Financial Officer (together, the Certifying Officers), or persons performing similar functions, as appropriate,
to allow timely decisions regarding required disclosure.
Under the supervision and with the participation
of our management, including our Certifying Officers, we carried out an evaluation of the effectiveness of the design and operation of
our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our
Certifying Officers concluded that our disclosure controls and procedures were effective as of the end of the year ended December 31,
2025.
Managements Report on Internal Controls
Over Financial Reporting
As required by SEC rules and regulations implementing
Section 404 of the Sarbanes-Oxley Act, our management is responsible for establishing and maintaining adequate internal control over financial
reporting. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of our consolidated financial statements for external reporting purposes in accordance with GAAP. Our internal
control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the assets of our company, (ii) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that
our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could
have a material effect on the consolidated financial statements.
Because of its inherent limitations, internal
control over financial reporting may not prevent or detect errors or misstatements in our consolidated financial statements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree or compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of
our internal control over financial reporting at December 31, 2025. In making these assessments, management used the criteria set forth
by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control Integrated Framework (2013).
Based on our assessments and those criteria, management determined that we did maintain effective internal control over financial reporting
as of December 31, 2025.
This Annual Report does not include an attestation
report of our independent registered public accounting firm due to our status as an emerging growth company under the JOBS Act.
Changes in Internal Control Over Financial
Reporting
There were no changes in our internal controls
over financial reporting that occurred during the fourth quarter of the fiscal year covered by this Annual Report that have materially
affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Trading Arrangements
During the quarterly period ended December 31, 2025, none of our directors or officers (as defined in Rule 16a-1(f) promulgated under the Exchange Act) adopted or terminated any Rule 10b5-1 trading arrangement or any non-Rule 10b5-1 trading arrangement, as each term is defined in Item 408(a) of Regulation S-K.
Additional Information
None.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS
THAT PREVENT INSPECTIONS
Not applicable.
49
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Directors and Officers
|
Name |
|
Age |
|
Title | |
|
Kanishka Roy |
|
50 |
|
Chairman and Chief Executive Officer | |
|
Steven Handwerker |
|
37 |
|
Chief Financial Officer and Director | |
|
Aidin Aghamiri |
|
41 |
|
Director | |
|
Allan Chou |
|
49 |
|
Director | |
|
Anjai Gandhi |
|
56 |
|
Director | |
|
Avanish Sahai |
|
60 |
|
Director | |
Our directors and officers are as follows:
**
*Kanishka Roy* - Since June 2024,
Mr. Roy has served as our Chairman and Chief Executive Officer. Mr. Roy is a technology and finance veteran, with over 25 years of experience
as a technology investment banker, public company executive, and growth investor. Since March 2021, Mr. Roy has served as a co-founder
and Managing Partner of Plum Partners, a late-stage investment company. He served as Chairman and CEO of Plum Acquisition Corp. I from
March 2021 until September 2024 when it completed its business combination with Veea Inc., and currently serves as a director of Veea
Inc.. Since January 2024, Mr. Roy has served as Chairman, President and CEO of Plum Acquisition Corp. III - a special purpose acquisition
company traded on Nasdaq, and is also the manager of Mercury Capital, its sponsor. From 2010 to 2019, Mr. Roy advised leading Software
and Internet companies with mergers and acquisitions (M&A) and capital markets transactions. Mr. Roy served as the Global Head of
Tech M&A Origination for Morgan Stanley, where he was responsible for initiating large, industry-transforming mergers, helping clients
take a long-term view of the competitive landscape and implementing large, industry-shaping M&A transactions. Over his career, Mr.
Roy has participated in over $100 billion of M&A transactions. From 2019 to 2020, he was Global CFO at SmartNews, a multi-billion-dollar
AI company with over 20 million monthly average users, and led the strategic finance and growth of a rapidly growing company across multiple
geographies. Mr. Roy started his career as a software engineer at two software startups, both of which were acquired by larger public
companies, and also worked in executive strategy roles at IBM. Mr. Roy holds an undergraduate degree in Electrical & Computer Engineering
and an MBA from the Tuck School of Business at Dartmouth.
**
*Steven Handwerker* - Since July 2024,
Mr. Handwerker has served as our Chief Financial Officer and Director. Mr. Handwerker has also served as Chief Financial Officer of Plum
Acquisition Corp. III since March 2024. Mr. Handwerker also serves as a Financial Consultant to Events.com, a software company building
a comprehensive event management platform. Mr. Handwerker was the Chief Financial Officer of FinServ Acquisition Corp. II from 2021 until
2023. From 2019 to 2021, Mr. Handwerker served as a consultant for FinServ Acquisition Corp., and was involved in all aspects of its business
and operations. Mr. Handwerker has more than 15 years of experience investing in and covering the financial services and FinTech industries.
From 2013 to 2017, he was an Analyst at Citadels equity long/short hedge fund platform, covering companies within the financial
services and FinTech sectors. Prior to Citadel, Mr. Handwerker was an Investment Banking Analyst in Barclays Financial Institutions
Group from 2010 to 2013. He received his BBA from Emory University.
**
*Aidin Aghamiri* Mr. Aghamiri
has served as an independent director since April 2025. Mr. Aghamiri is an entrepreneur and business strategist. Since 2023, Mr. Aghamiri
has served as a data center developer, focusing on the development of nationwide facilities specifically designed and optimized for artificial
intelligence inference workloads. Previously, from 2007 to 2022, he was a Co-founder of ITRenew, where he served as CEO and as a member
of its board of directors from 2017 to 2022. IT Renew supports hyperscale data center operators in managing, expanding, and optimizing
their hardware infrastructure during periods of digital transformation and rapid data growth. Mr. Aghamiri earned a Bachelor of Science
degree in Finance from Ohio State University and an MBA in Business from Duke University.
*Allan Chou* - Mr. Chou has served
as an independent director since the closing of our initial public offering. Mr. Chou currently serves as a Partner at Northgate Capital
LLCs Bay Area office, where he has held various other positions since 2006. Mr. Chou began his professional career at Cambridge
Associates, LLC in 1999 as an analyst. During his tenure which ended in 2003, he was promoted to team leader and alternative assets associate.
He returned to Cambridge Associates in 2005 as a specialist consultant after obtaining an MBA, focusing on venture capital and private
equity non-marketable alternative asset programs. While in business school, Mr. Chou served as a summer associate at Northgate Capital
LLC in 2004. Mr. Chou graduated with a Bachelor of Arts degree in Economics from Pomona College, received an MBA from the Amos Tuck School
of Business at Dartmouth College and has earned the Chartered Financial Analyst designation.
**
**
50
**
*Anjai Gandhi* - Mr. Gandhi has served
as an independent director since the closing of our initial public offering. Mr. Gandhi currently serves as Chief Growth Officer at Marlin
Equity Partners, a private equity fund that invests primarily in B2B software companies since 2020. During his more than 30-year career,
he has helped implement growth acceleration strategies and go-to-market productivity improvements at more than 100 companies, primarily
in the technology industry. Previously, Mr. Gandhi was a member of the go-to-market (GTM) leadership teams at RingCentral,
from 2016 to 2019, and at Salesforce.com, from 2010 and 2012, where he guided acceleration in the enterprise segment, global expansion
and the growth of multiple new product lines. He began his career in management consulting at Bain, McKinsey and The Alexander Group serving
clients primarily on B2B marketing and sales strategy/effectiveness. Mr. Gandhi serves on multiple non-profit boards, including the HBS
Club of Northern California. Mr. Gandhi earned a BS in Business Administration from University of California, Berkeley and an MBA from
Harvard Business School.
**
*Avanish Sahai* - Mr. Sahai has served as an independent director since the closing of our initial public offering. Mr. Sahai is a former technology executive
with experience in product, marketing, and ecosystems. From December 2019 until December 2021, Mr. Sahai served as vice president, ISV
and apps partner ecosystem of Google. Previously, from December 2016 to December 2019, he served as global vice president, ISV and technology
alliances at ServiceNow. From May 2015 to December 2016, Mr. Sahai was the senior vice president of channels and alliances at InsideSales.com.
From April 2014 to May 2015, he was the senior vice president and chief product officer at Demandbase. Prior to Demandbase, Mr. Sahai
held leadership positions at Salesforce.com, Oracle, and McKinsey & Company, as well as various early-to-mid stage startups in Silicon
Valley. Mr. Sahai previously served on the boards of technology companies, including HubSpot (NYSE:HUBS) from April 2018 to September
2023, and currently serves on the boards of Birdie.ai (venture backed), Scribe (PE-backed, acquired by TIBCO), Flywl, Meta IT Services
(Brazil) and Blip.ai, as well as on the board of Novaworks, a workforce development organization for various California counties. Mr.
Sahai holds an MBA from UCLA Anderson, an MSCE from Boston University, and a BSEE from the Universidade de So Paulo, Brazil.
Select Leadership Council Members
Ursula Burns and Mike Dinsdale serve as our leadership
council members.
Ursula Burns. Ms. Burns is the co-founder
of Integrum Holdings LP, an investment firm focused on partnering with technology-enabled services companies. From March 2021 until July
2023, Ms. Burns served as Executive Chairwoman and a director of Plum Acquisition Corp. I, and was a manager of Plum Partners, its sponsor.
Mike Dinsdale. Mr. Dinsdale has strategic
expertise in helping to build high-growth international companies. From March 2021 until the completion of its business combination September
2024, Mr. Dinsdale served as Co-Chief Executive Officer, Chief Financial Officer and a director of Plum Acquisition Corp. I, and was a
manager of Plum Partners, its sponsor. From January 2024 to January 2025, Mr. Dinsdale also served as a board member of Plum Acquisition
Corp III.
Number and Terms of Office of Officers and Directors
Our board of directors consists of six members.
Prior to our initial business combination, holders of our founder shares will have the right to vote to appoint all of our directors and
remove members of the board of directors for any reason, and holders of our public shares will not have the right to vote on the appointment
of directors during such time; provided, however, that if all of the founder shares are converted to Class A ordinary shares prior to
the date of the initial business combination, the holders of our public shares will have the right to vote on the election of directors.
These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed
by a majority of at least 90% of our ordinary shares attending and voting in a general meeting. Each of our directors will hold office
for a three-year term. Subject to any other special rights applicable to the shareholders, any vacancies on our board of directors may
be filled by the affirmative vote of a majority of the directors present and voting at the meeting of our board of directors or by a majority
of the holders of our ordinary shares (or, prior to our initial business combination, holders of our founder shares).
Our officers are appointed by the board of directors
and serve at the discretion of the board of directors, rather than for specific terms of office. Our board of directors is authorized
to appoint persons to the offices set forth in our amended and restated memorandum and articles of association as it deems appropriate.
Our amended and restated memorandum and articles of association provide that our officers may consist of a Chairman, a Vice-Chairman,
a Chief Executive Officer, a President, a Chief Operating Officer, a Chief Financial Officer, Vice Presidents, a Secretary, Assistant
Secretaries, a Treasurer and such other offices as may be determined by the board of directors.
51
Committees of the Board of Directors
Pursuant to Nasdaq listing rules, we have established
three standing committees - an audit committee in compliance with Section 3(a)(58)(A) of the Exchange Act, a compensation committee, and
a nominating and corporate governance committee, each comprised of independent directors.
*Audit Committee*
**
The members of our audit committee are Allan Chou,
Anjai Gandhi and Avanish Sahai. Allan Chou serves as chairman of the audit committee.
Each member of the audit committee is financially
literate and our board of directors has determined that Allan Chou qualifies as an audit committee financial expert as defined
in applicable SEC rules and has accounting or related financial management expertise.
We have adopted an audit committee charter, which
details the purpose and principal functions of the audit committee, including:
|
|
|
assisting board oversight of (1) the integrity of our financial statements, (2) our compliance with legal and regulatory requirements, (3) our independent registered public accounting firms qualifications and independence, and (4) the performance of our internal audit function and independent registered public accounting firm; | |
|
|
|
the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm and any other registered public accounting firm engaged by us; | |
|
|
|
pre-approving all audit and non-audit services to be provided by the independent registered public accounting firm or any other registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; | |
|
|
|
reviewing and discussing with the independent registered public accounting firm all relationships the independent registered public accounting firm has with us in order to evaluate their continued independence; | |
|
|
|
setting clear hiring policies for employees or former employees of the independent registered public accounting firm; | |
|
|
|
setting clear policies for audit partner rotation in compliance with applicable laws and regulations; | |
|
|
|
obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (1) the independent registered public accounting firms internal quality-control procedures and (2) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues; | |
|
|
|
meeting to review and discuss our annual audited financial statements and quarterly financial statements with management and the independent registered public accounting firm, including reviewing our specific disclosures under Managements Discussion and Analysis of Financial Condition and Results of Operations; | |
52
*Compensation Committee*
The members of our compensation committee are
Allan Chou, Anjai Gandhi and Avanish Sahai. Avanish Sahai serves as chairman of the compensation committee. We have adopted a compensation
committee charter, which details the purpose and responsibility of the compensation committee, including:
|
|
|
reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officers compensation, evaluating our Chief Executive Officers performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; | |
|
|
|
reviewing and making recommendations to our board of directors with respect to the compensation, and any incentive-compensation and equity-based plans that are subject to board approval of all of our other officers; | |
|
|
|
reviewing our executive compensation policies and plans; | |
|
|
|
implementing and administering our incentive compensation equity-based remuneration plans; | |
|
|
|
assisting management in complying with our proxy statement and annual report disclosure requirements; | |
|
|
|
approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; | |
|
|
|
producing a report on executive compensation to be included in our annual proxy statement; and | |
|
|
|
reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. | |
The charter also provides that the compensation
committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, independent legal counsel or other adviser
and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However, before engaging
or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee will consider
the independence of each such adviser, including the factors required by Nasdaq and the SEC.
*Nominating and Corporate Governance Committee*
The members of our nominating and corporate governance
committee are Allan Chou, Anjai Gandhi and Avanish Sahai. Anjai Gandhi serves as chair of the nominating and corporate governance committee.
We have adopted a nominating and corporate governance committee charter, which details the purpose and responsibilities of the nominating
and corporate governance committee, including:
|
|
|
identifying, screening and reviewing individuals qualified to serve as directors, consistent with criteria approved by the board of directors, and recommending to the board of directors candidates for nomination for election at the annual general meeting or to fill vacancies on the board of directors; | |
|
|
|
developing and recommending to the board of directors and overseeing implementation of our corporate governance guidelines; | |
|
|
|
coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual directors and management in the governance of Inc company; and | |
|
|
|
reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary. | |
53
The charter also provides that the nominating
and corporate governance committee may, in its sole discretion, retain or obtain the advice of, and terminate, any search firm to be used
to identify director candidates, and will be directly responsible for approving the search firms fees and other retention terms.
We have not formally established any specific,
minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating
nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge of our
business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our shareholders.
Prior to our initial business combination, holders of our public shares will not have the right to recommend director candidates for nomination
to our board of directors.
*Code of Ethics and Committee Charters*
We have adopted a code of ethics and business
conduct (our Code of Ethics) applicable to our directors, officers and employees. You can review this document by accessing
our public filings at the SECs website at *www.sec.gov.*In addition, a copy of our Code of Ethics will be provided without
charge upon request from us. We have filed our audit committee, compensation committee, and nominating and corporate governance committee
charters as exhibits to our most recent S-1, and you may review these documents by accessing our public filings at the SECs web
site at *www.sec.gov*.
*Trading Policies*
We adopted insider trading policies and procedures governing the purchase, sale, and/or other dispositions of our securities by directors, officers and employees, which are reasonably designed to promote compliance with insider trading laws, rules and regulations, and the applicable Nasdaq Rules (the Insider Trading Policy). We have filed our Insider Trading Policy as an exhibit to this Annual Report.
**
*Compensation Recovery and Clawback Policy*
Under the Sarbanes-Oxley Act, in the event of
misconduct that results in a financial restatement that would have reduced a previously paid incentive amount, we can recoup those improper
payments from our executive officers. We have adopted the Executive Officer Clawback Policy to comply with the rules adopted by the SEC
under Rule 10D-1 under the Exchange Act, and the listing standards, as set forth in Nasdaq Listing Rule. We have filed our Executive Officer
Clawback Policy as an exhibit to this Annual Report.
*Delinquent Section 16(a) Reports*
Section 16(a) of the Exchange Act requires
our executive officers and directors and persons who beneficially own more than 10% of our equity securities to timely file certain
reports regarding ownership of and transactions in our securities with the SEC. Based solely upon our review of the Section 16(a)
filings that have been furnished to us, we believe that all required Section 16(a) filings were timely filed during the year ended
December 31, 2025, except for a Form 4 required to be filed by each of our sponsor and Chief Executive Officer to report a transfer
of 25,000 founder shares beneficially owned by them to our newly appointed director, Mr. Aghamiri.
54
ITEM 11. EXECUTIVE COMPENSATION
Executive Officer and Director Compensation
None of our directors or officers have received
any cash compensation for services rendered to us. During July and August 2024, the sponsor transferred 25,000 founder shares to each
of our independent directors (an aggregate of 75,000 founder shares), in each case at their original purchase price of $0.003 per share.
Our sponsor, directors and officers, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred
in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business
combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, directors, officers
or our or any of their respective affiliates.
We are not prohibited from paying any fees (including
advisory fees), reimbursements or cash payments to our sponsor, officers or directors, or our or their affiliates, for services rendered
to us prior to or in connection with the completion of our initial business combination, including the following payments, all of which,
if made prior to the completion of our initial business combination, will be paid from funds held outside the trust account:
|
|
|
repayment of an aggregate of up to $500,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; | |
|
|
|
payments to each of our Chief Executive Officer and Chief Financial Officer of $20,833 per month for consulting services rendered to us, commencing upon closing of our initial public offering, through the closing of our initial business combination, subject to availability of sufficient funds from working capital held outside the trust account; | |
|
|
|
engagement of our sponsor, or one or more affiliates of our sponsor, as an advisor or otherwise in connection with our initial business combination and certain other transactions and pay such persons or entities a salary or fee in an amount that constitutes a market standard for comparable transactions; | |
|
|
|
payment of customary fees for financial advisory services; and | |
|
|
|
reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and repayment of loans which may be made by any of our sponsor, any of its affiliates or certain of our directors and officers to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit at the option of the lender. | |
After the completion of our initial business combination,
directors or members of our management team who remain with us may be paid consulting, management or other compensation from the combined
company. All compensation will be fully disclosed to shareholders, to the extent then known, in the tender offer materials or proxy solicitation
materials furnished to our shareholders in connection with a proposed business combination. It is unlikely the amount of such compensation
will be known at the time, because the directors of the post-combination business will be responsible for determining executive officer
and director compensation. Any compensation to be paid to our officers after the completion of our initial business combination will be
determined by a compensation committee constituted solely by independent directors.
We are not party to any agreements with our directors
and officers that provide for benefits upon termination of employment. The existence or terms of any such employment or consulting arrangements
may influence our managements motivation in identifying or selecting a target business, and we do not believe that the ability
of our management to remain with us after the consummation of our initial business combination should be a determining factor in our decision
to proceed with any potential business combination.
55
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth information regarding
the beneficial ownership of our ordinary shares as of March 31, 2026 by:
|
|
|
each person known by us to be the beneficial owner of more than 5% of our issued and outstanding ordinary shares; | |
|
|
|
each of our directors and officers that beneficially owns ordinary shares; and | |
|
|
|
all our directors and officers as a group. | |
Unless otherwise indicated, we believe that all
persons named in the table have sole voting and investment power with respect to all ordinary shares beneficially owned by them. The following
table does not reflect record or beneficial ownership of the private placement warrants underlying the private placement units.
|
Name and Address of Beneficial Owner(1) | |
Number of Shares Beneficially Owned | | |
Approximate Percentage of Outstanding Ordinary Shares | | |
|
Plum Partners IV, LLC(2)(3) | |
| 6,660,000 | | |
| 27.5 | % | |
|
Kanishka Roy(2) | |
| 6,660,000 | | |
| 27.5 | % | |
|
Steven Handwerker | |
| - | | |
| - | | |
|
Aidin Aghamiri | |
| 25,000 | | |
| * | | |
|
Anjai Gandhi | |
| 25,000 | | |
| * | | |
|
Avanish Sahai | |
| 25,000 | | |
| * | | |
|
Allan Chou | |
| 25,000 | | |
| * | | |
|
All directors and officers as a group (6 individuals) | |
| 6,760,000 | (4) | |
| 27.9 | % | |
|
| |
| | | |
| | | |
|
Westchester Capital Management, LLC(5) | |
| 1,225,000 | | |
| 5.1 | % | |
|
* | Less than one percent. |
|
|
(1) | Unless otherwise noted, the business
address of each of the following entities or individuals is c/o Plum Acquisition Corp. IV, 2021 Fillmore St. #2089, San Francisco, California
94115. |
|
|
(2) | Our sponsor is the record holder
of 5,650,000 founder shares, 440,000 private placements shares included as part of the private placement units and 570,000 restricted
private placement shares. Kanishka Roy, our Chairman and Chief Executive Officer, is the managing member of our sponsor, therefore, he
may be deemed to have beneficial ownership of the Class B ordinary shares, private placement shares and restricted private placement
shares held directly by our sponsor. Each member of our management team is a member of our sponsor and has direct and/or indirect economic
interests in our sponsor, and each of them disclaims any beneficial ownership other than to the extent of his pecuniary interest. |
|
|
(3) | The
non-managing investors purchased through investments in our sponsor, an aggregate of 285,000 private placement units and 570,000 restricted
private placement shares. The non-managing investors were not granted any shareholder or other rights in addition to those afforded to
our other public shareholders, and were only issued membership interests our sponsor, with no right to control our sponsor or vote or
dispose of any securities held by our sponsor, including the founder shares held by our sponsor. |
|
|
(4) | Represents
5,750,000 founder shares directly held by our initial shareholders plus 440,000 private placements shares included as part of the private
placement units and 570,000 restricted private placement shares. |
|
|
(5) | Based
on a Schedule 13G filed on August 14, 2025, by Westchester Capital Management, LLC ("Westchester"), a Delaware limited liability
company, Virtus Investment Advisers, LLC ("Virtus"), a Delaware limited liability company, and The Merger Fund ("MF"),
a Massachusetts business trust. Virtus, a registered investment adviser, serves as the investment adviser to MF. Westchester, a registered
investment adviser, serves as sub-advisor to each of MF and JNL Multi-Manager Alternative Fund ("JARB", together with MF, the
"Funds"). The Funds directly hold ordinary shares of the Company for the benefit of the investors in those Funds. Mr. Roy Behren
and Mr. Michael T. Shannon each serve as Co-Presidents of Westchester. The principal business address for Westchester is 100 Summit Lake
Drive, Valhalla, NY 10595; the principal business address for Virtus is One Financial Plaza, Hartford, CT 06103, and the principal business
address for MF is 101 Munson Street, Greenfield, MA 01301-9683. |
|
56
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
Certain Relationships and Related Transactions
On June 26, 2024, our sponsor paid $25,000 to
cover certain of our offering and formation costs in exchange for the issuance of 7,665,900 founder shares to our sponsor, or approximately
$0.003 per share. The number of founder shares issued was determined based on the expectation that the founder shares would represent
25% of the issued and outstanding ordinary shares upon completion of our initial public offering (not including the Class A ordinary shares
underlying the private placement units and the restricted private placement shares). Subsequently, during July and August, 2024, our sponsor
transferred 25,000 founder shares to three of our independent directors (an aggregate of 75,000 founder shares) at their original purchase
price. On December 6, 2024, our sponsor surrendered 1,915,900 founder shares for no consideration. Our initial shareholders currently
hold an aggregate of 5,750,000 founder shares. On April 25, 2025, our sponsor transferred 25,000 founder shares to our fourth independent
director.
In connection with the initial public offering,
our sponsor purchased an aggregate of 440,000 private placement units and 570,000 restricted private placement shares at a price of $10.00
per private placement unit or a combined price of $10.00 per non-managing investor private placement security, as applicable, or $4,400,000
in the aggregate, in a private placement that closed simultaneously with the closing of our initial public offering.
In addition, in connection with the initial public
offering, the underwriters used a portion of their underwriting discount and commission to purchase an aggregate of 232,875 private placement
units at a price of $10.00 per unit, or $2,328,750 in the aggregate, in a private placement that closed simultaneously with the closing
of our initial public offering.
The private placement units are identical to the
units sold in our initial public offering except that private placement units (including the underlying securities) may not, subject to
certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of our initial business
combination and will be entitled to registration rights. The restricted private placement shares are held by the sponsor and will be transferred
to the non-managing investors (or their designees) only upon the consummation of an initial business combination. Other than such permitted
transfer, the restricted private placement shares will be subject to transfer restrictions for 90 days following our initial business
combination and will be entitled to registration rights.
If any of our directors or officers becomes aware
of a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary
or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting
such business combination opportunity to us. Our directors and officers currently have certain relevant fiduciary duties or contractual
obligations that may take priority over their duties to us.
Members of our management team, our board of directors
directly or indirectly own founder shares and/or private placement units and, accordingly, may have a conflict of interest in determining
whether a particular target business is an appropriate business with which to effectuate our initial business combination.
Our Chief Executive Officer and Chief Financial
Officer are paid $20,833 per month for consulting services rendered to us, commencing upon closing of our initial public offering, through
the closing of our initial business combination, subject to availability of sufficient funds from working capital held outside the trust
account.
Our sponsor, directors and officers, or any of
their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such
as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review
on a quarterly basis all payments that were made to our sponsor, directors, officers or our or any of their respective affiliates and
will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket
expenses incurred by such persons in connection with activities on our behalf.
57
Prior to the closing of our initial public offering,
our sponsor agreed to loan us up to $500,000 under an unsecured promissory note, dated June 26, 2024 (as amended on January 6, 2025).
This promissory note was used for a portion of the expenses of our initial public offering. The loans were non-interest bearing, unsecured
and were due at the earlier of February 1, 2025 and the closing of our initial public offering. The loans were repaid upon completion
of our initial public offering out of the $953,750 of offering proceeds that was allocated for the payment of offering expenses (other
than underwriting commissions) not held in the trust account.
On July 8, 2025, we issued an unsecured promissory
note in the principal amount of up to $1,500,000 to the sponsor which may be drawn down from time to time prior to the Maturity Date (as
defined below) upon our request. The July Note does not bear interest and the principal balance will be payable on the date on which we
consummate our initial business combination. In the event we consummate the business combination, the sponsor has the option on the Maturity
Date to convert the principal outstanding under the July Note into that number of ordinary shares of the post-business combination company.
The number of New PubCo Shares to be received by the sponsor in connection with such optional conversion will be an amount determined
by dividing (x) the sum of the outstanding principal amount (or portion thereof) payable to the sponsor by (y) $10.00. The July Note is
subject to customary events of default, the occurrence of certain of which automatically triggers the unpaid principal balance of the
July Note and all other sums payable with regard to the Note becoming immediately due and payable.
In addition, in order to finance transaction costs
in connection with an intended initial business combination, either of our sponsor, any of its affiliates or certain of our directors
and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may
repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds
held outside the trust account. 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 to repay such
loaned amounts. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit at the option of the lender.
The units would be identical to the units sold in our initial public offering, subject to certain limited exceptions as described in this
Annual Report. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We
do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will
be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.
After our initial business combination, members
of our management team who remain with us may be paid consulting, management or other fees from the combined company with any and all
amounts being fully disclosed to our shareholders, to the extent then known, in the tender offer or proxy solicitation materials, as applicable,
furnished to our shareholders. It is unlikely the amount of such compensation will be known at the time of distribution of such tender
offer materials or at the time of a general meeting held to consider our initial business combination, as applicable, as it will be up
to the directors of the post-combination business to determine executive officer and director compensation.
We have entered into a registration rights agreement
with respect to the founder shares, restricted private placement shares, private placement units and units issued upon conversion of
working capital loans (if any).
Related Party Policy
We have not yet adopted a formal policy for the
review, approval or ratification of related party transactions. Accordingly, the transactions discussed above were not reviewed, approved
or ratified in accordance with any such policy.
Prior to the closing of our initial public offering,
we adopted our Code of Ethics requiring us to avoid, wherever possible, all conflicts of interests, except under guidelines or resolutions
approved by our board of directors (or the appropriate committee of our board of directors) or as disclosed in our public filings with
the SEC. Under our Code of Ethics, conflict of interest situations include any financial transaction, arrangement or relationship (including
any indebtedness or guarantee of indebtedness) involving the company.
58
In addition, our audit committee is responsible
for reviewing and approving related party transactions to the extent that we enter into such transactions. An affirmative vote of a majority
of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related
party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous
written consent of all of the members of the audit committee will be required to approve a related party transaction. Our audit committee
will review on a quarterly basis all payments that were made to our sponsor, directors or officers, or our or any of their respective
affiliates.
These procedures are intended to determine whether
any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director,
employee or officer.
To further minimize conflicts of interest, we
have agreed not to consummate an initial business combination with an entity that is affiliated with any of our sponsor, directors or
officers unless we, or a committee of independent and disinterested directors, have obtained an opinion from an independent investment
banking firm which is a member of FINRA or an independent accounting firm that our initial business combination is fair to our shareholders
from a financial point of view. In addition, pursuant to Nasdaq listing rules, our initial business combination must be approved by a
majority of our independent directors.
We are not prohibited from paying any fees (including
advisory fees), reimbursements or cash payments to our sponsor, officers or directors, or our or their affiliates, for services rendered
to us prior to or in connection with the completion of our initial business combination, including the following payments, all of which,
if made prior to the completion of our initial business combination, will be paid from funds held outside the trust account:
|
| payments to each of our Chief
Executive Officer and Chief Financial Officer of $20,833 per month for consulting services rendered to us, commencing upon closing of
our initial public offering, through the closing of our initial business combination, subject to availability of sufficient funds from
working capital held outside the trust account; |
|
|
| engagement of our sponsor, or
one or more affiliates of our sponsor, as an advisor or otherwise in connection with our initial business combination and certain other
transactions and pay such persons or entities a salary or fee in an amount that constitutes a market standard for comparable transactions; |
|
|
| payment of customary fees for
financial advisory services; and |
|
|
| reimbursement for any out-of-pocket
expenses related to identifying, investigating and completing an initial business combination; and repayment of loans which may be made
by any of our sponsor, any of its affiliates or certain of our directors and officers to finance transaction costs in connection with
an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with
respect thereto. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit at the option of the lender. |
|
The above payments may be funded using the net
proceeds of our initial public offering and the sale of the private placement securities not held in the trust account or, upon completion
of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith.
Director Independence
Nasdaq listing standards require that a majority
of our board of directors be independent within one year of our initial public offering. An independent director is defined
generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship
which in the opinion of the companys board of directors, would interfere with the directors exercise of independent judgment
in carrying out the responsibilities of a director. We have three independent directors as defined in the Nasdaq listing
standards and applicable SEC rules. Our board has determined that each of Aidin Aghamiri, Allan Chou, Anjai Gandhi and Avanish Sahai is
an independent director under applicable SEC rules and the Nasdaq listing standards.
Our independent directors will have regularly scheduled meetings at
which only independent directors are present.
59
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The firm of WithumSmith+Brown, PC, or Withum,
acts as our independent registered public accounting firm. The following is a summary of fees paid to Withum for services rendered.
*Audit Fees*. During the year ended December
31, 2025 and for the period from June10, 2024 (inception) through December 31, 2024, fees for our independent registered public
accounting firm were approximately $133,000 and $93,600 for the services, respectively. Withum performed in connection with our initial
public offering and the audit of our December 31, 2025 financial statements included in this Annual Report.
**
*Audit-Related Fees.* During the year ended
December 31, 2025 and for the period from June10, 2024 (inception) through December 31, 2024, our independent registered public
accounting firm did not render assurance and related services related to the performance of the audit or review of financial statements.
*Tax Fees*. During the year ended December
31, 2025 and for the period from June10, 2024 (inception) through December 31, 2024, fees for our independent registered public
accounting firm were approximately $4,160 and $0, respectively, for tax compliance, tax advice and tax planning services.
*All Other Fees*. During the year ended December
31, 2025 and for the period from June10, 2024 (inception) through December 31, 2024, there were no fees billed for products and
services provided by our independent registered public accounting firm other than those set forth above.
Pre-Approval Policy
Our audit committee was formed in connection with
the effectiveness of our registration statement for our initial public offering. As a result, the audit committee did not pre-approve
all of the foregoing services, although any services rendered prior to the formation of our audit committee were approved by our board
of directors. Since the formation of our audit committee, and on a going-forward basis, the audit committee has and will pre-approve all
audit services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject
to the *de minimis*exceptions for non-audit services described in the Exchange Act which are approved by the audit committee prior
to the completion of the audit).
60
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) The following documents are filed as part of this report or incorporated herein by reference:
(1) Our Financial Statements are listed on page F-1 of this Annual Report
|
|
Page | |
|
Report of Independent Registered Public Accounting Firm |
F-2 | |
|
Balance Sheet as of December 31, 2025 |
F-3 | |
|
Statement of Operations for the Years Ended December 31, 2025 and December 31, 2024 |
F-4 | |
|
Statement of Changes in Shareholders Deficit for the Years Ended December 31, 2025 and December 31, 2024 |
F-5 | |
|
Statement of Cash Flows for the Years Ended December 31, 2025 and December 31, 2024 |
F-6 | |
|
Notes to Financial Statements |
F-7 | |
(2) Financial Statements Schedule
None.
61
(3) Exhibits:
The following documents are included as exhibits to this
Annual Report:
|
Exhibit No. |
|
Description | |
|
2.1(1) |
|
Business Combination Agreement, dated March 8, 2026, by and among the Company, Plum IV Merger Sub Inc. and Controlled Thermal Resources Holdings Inc. | |
|
3.1(2) |
|
Amended and Restated Memorandum and Articles of Association | |
|
4.1(3) |
|
Specimen Unit Certificate | |
|
4.2(3) |
|
Specimen Class A Ordinary Share Certificate | |
|
4.3(3) |
|
Specimen Warrant Certificate (included in Exhibit 4.4) | |
|
4.4(2) |
|
Warrant Agreement, dated January 14, 2025, between the Company and Odyssey Transfer and Trust Company | |
|
4.5(4) |
|
Description of Securities of the Registrant. | |
|
10.1(2) |
|
Units and Restricted Shares Subscription Agreement, dated January 14, 2025, between the Company and Plum Partners IV, LLC | |
|
10.2(2) |
|
Units Subscription Agreement, dated January 14, 2025, between the Company and Cohen & Company Capital Markets, a division of J.V.B. Financial Group, LLC | |
|
10.3(2) |
|
Units Subscription Agreement, dated January 14, 2025, between the Company and Seaport Global Securities LLC | |
|
10.4(2) |
|
Letter Agreement, dated January 14, 2025, among the Company, the sponsor and each of the initial shareholders, directors and officers of the Company | |
|
10.5(2) |
|
Investment Management Trust Account Agreement, dated January 14, 2025, between the Company and Continental Stock Transfer & Trust Company | |
|
10.6(2) |
|
Registration Rights Agreement, dated January 14, 2025, among the Company, the sponsor and the other Holders (as defined therein) signatory thereto | |
|
10.7(2) |
|
Form of Indemnity Agreement, January 14, 2025, between the Company and each of the officers and directors of the Company | |
|
10.8(3) |
|
Amended and Restated Promissory Note, dated January 6, 2025, issued to Plum Partners IV, LLC | |
|
10.9(5) |
|
Promissory Note, dated July 8, 2025, issued by Plum Acquisition Corp. IV to Plum Partners IV, LLC | |
|
10.10(1) |
|
Transaction Support Agreement, dated March 8, 2026, by and among the Company and certain stockholders of Controlled Thermal Resources Holdings Inc. party thereto. | |
|
10.11(1) |
|
Form of Amended and Restated Registration Rights Agreement. | |
|
10.12(1) |
|
Form of Lock-Up Agreement. | |
|
14(3) |
|
Code of Ethics | |
|
19(4) |
|
Insider Trading Policy | |
|
31.1* |
|
Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a). | |
|
31.2* |
|
Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a). | |
|
32.1** |
|
Certification of Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350. | |
|
32.2** |
|
Certification of Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350. | |
|
97.1(4) |
|
Clawback Policy | |
|
101.INS* |
|
Inline XBRL Instance Document. | |
|
101.SCH* |
|
Inline XBRL Taxonomy Extension Schema. | |
|
101.CAL* |
|
Inline XBRL Taxonomy Calculation Linkbase. | |
|
101.LAB* |
|
Inline XBRL Taxonomy Label Document. | |
|
101.PRE* |
|
Inline XBRL Definition Linkbase Document. | |
|
101.DEF* |
|
Inline XBRL Definition Linkbase Document. | |
|
104* |
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | |
|
* | Filed herewith. |
|
|
** | Furnished herewith. |
|
|
(1) | Incorporated by reference to an
exhibit to the Registrants Current Report on Form 8-K (File No. 001-42472), filed with the SEC on March 12, 2026. |
|
|
(2) | Incorporated by reference to an
exhibit to the Registrants Current Report on Form 8-K (File No. 001-42472), filed with the SEC on January 16, 2025. |
|
|
(3) | Incorporated by reference to an
exhibit to the Registrants Registration Statement on Form S-1, as amended (File No. 333-281144), filed with the SEC on January
7, 2025. |
|
|
(4) | Incorporated by reference to an
exhibit to the Annual Report on Form 10-K (File No. 333-281144), filed with the SEC on March 31, 2025. |
|
|
(5) | Incorporated by reference to an
exhibit to the Registrants Current Report on Form 8-K (File No. 001-42472), filed with the SEC on July 14, 2025. |
|
ITEM 16. FORM 10-K SUMMARY
None.
62
PLUM ACQUISITION CORP.
IV
INDEX TO FINANCIAL STATEMENTS
|
Report of Independent Registered Public Accounting Firm (PCAOB ID Number 100) |
F-2 | |
|
Financial Statements: |
| |
|
Balance Sheets as of December 31, 2025 and 2024 |
F-3 | |
|
Statements of Operations for the Year Ended December 31, 2025 and for the Period from June 10, 2024 (Inception) through December 31, 2024 |
F-4 | |
|
Statements of Changes in Shareholders Deficit for the Year Ended December 31, 2025 and for the Period from June 10, 2024 (Inception) through December 31, 2024 |
F-5 | |
|
Statements of Cash Flows for the Year Ended December 31, 2025 and for the Period from June 10, 2024 (Inception) through December 31, 2024 |
F-6 | |
|
Notes to Financial Statements |
F-7 to F-22 | |
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To the Shareholders and the Board of Directors
of
Plum Acquisition Corp. IV
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Plum Acquisition Corp. IV (the Company) as of December 31, 2025 and 2024 and the related statements of operations, changes in shareholders deficit and cash flows for the year ended December 31, 2025 and for the period from June 10, 2024 (inception) through December 31, 2024 and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the year ended December 31, 2025 and for the period from June 10, 2024 (inception) through December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, if the Company is unable to raise additional funds to alleviate liquidity needs and complete a business combination by July 14, 2026, then the Company will cease all operations except for the purpose of liquidating. The liquidity condition and date for mandatory liquidation and subsequent dissolution raise substantial doubt about the Companys ability to continue as a going concern. Managements plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on the Companys financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ WithumSmith+Brown, PC
We have served as the Companys auditor since 2024.
New York, New York
March 31, 2026
PCAOB ID Number 100
F-2
PLUM ACQUISITION CORP. IV
BALANCE SHEETS
|
| |
December31, | | |
December31, | | |
|
| |
2025 | | |
2024 | | |
|
| |
| | |
| | |
|
ASSETS | |
| | |
| | |
|
Current assets | |
| | |
| | |
| Cash and cash equivalents | | $ | 296,249 | | | $ | 3,864 | | |
| Prepaid expenses | | | 96,976 | | | | | | |
| Total current assets | | | 393,225 | | | | 3,864 | | |
| Long-term prepaid expenses | | | 3,542 | | | | | | |
| Deferred offering costs | | | | | | | 438,352 | | |
| Investments held in Trust Account | | | 181,285,220 | | | | | | |
| Total Assets | | $ | 181,681,987 | | | $ | 442,216 | | |
|
Liabilities, Class A Ordinary Shares Subject to Possible Redemption, and Shareholders Deficit | |
| | | |
| | | |
|
Current liabilities | |
| | | |
| | | |
| Accrued expenses | | $ | 138,935 | | | $ | 42,445 | | |
| Due to officer | | | | | | | 12,374 | | |
| Accrued offering costs | | | 75,000 | | | | 304,904 | | |
| Promissory note related party | | | 250,000 | | | | 149,473 | | |
| Total current liabilities | | | 463,935 | | | | 509,196 | | |
| Deferred underwriting fee | | | 6,900,000 | | | | | | |
| Total Liabilities | | | 7,363,935 | | | | 509,196 | | |
|
| |
| | | |
| | | |
| Commitments and Contingencies (Note 6) | | | | | | | | | |
|
| |
| | | |
| | | |
| ClassA Ordinary Shares subject to possible redemption, 17,250,000 issued and outstanding and no shares at redemption value of approximately $10.51 and $0 per share at December 31, 2025 and 2024, respectively | | | 181,285,220 | | | | | | |
|
| |
| | | |
| | | |
|
Shareholders Deficit | |
| | | |
| | | |
|
| |
| | | |
| | | |
| Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding at December 31, 2025 and 2024 | | | | | | | | | |
| Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 1,242,875 shares issued and outstanding (excluding 17,250,000 shares subject to possible redemption) as of December 31, 2025 and no shares issued and outstanding as of December 31, 2024 | | | 124 | | | | | | |
| Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 5,750,000 shares issued and outstanding at December 31, 2025 and 2024 | | | 575 | | | | 575 | | |
| Additional paid-in capital | | | | | | | 24,425 | | |
| Accumulated deficit | | | (6,967,867 | ) | | | (91,980 | ) | |
| Total Shareholders Deficit | | | (6,967,168 | ) | | | (66,980 | ) | |
| Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption, and Shareholders Deficit | | $ | 181,681,987 | | | $ | 442,216 | | |
*The accompanying notes are an integral part
of the financial statements.*
F-3
PLUM ACQUISITION CORP. IV
STATEMENTS OF OPERATIONS
|
| |
For the Year Ended December 31, | | |
For the Period from June10,
2024
(Inception) Through December 31, | | |
|
| |
2025 | | |
2024 | | |
| Formation and general and administrative costs | | $ | 1,021,268 | | | $ | 91,980 | | |
| Loss from operations | | | (1,021,268 | ) | | | (91,980 | ) | |
|
| |
| | | |
| | | |
|
Other income: | |
| | | |
| | | |
| Interest earned on marketable securities held in Trust Account | | | 7,060,220 | | | | | | |
| Interest earned on operating account | | | 12,869 | | | | | | |
| Total other income | | | 7,073,089 | | | | | | |
|
| |
| | | |
| | | |
| Net income (loss) | | $ | 6,051,821 | | | $ | (91,980 | ) | |
|
| |
| | | |
| | | |
| Weighted average shares outstanding of Class A ordinary shares | | | 17,730,806 | | | | | | |
|
| |
| | | |
| | | |
| Basic and diluted net income per ordinary share, Class A ordinary shares | | $ | 0.26 | | | $ | | | |
|
| |
| | | |
| | | |
| Weighted average shares outstanding of Class B ordinary shares(1)(2) | | | 5,719,093 | | | | 5,000,000 | | |
|
| |
| | | |
| | | |
| Basic net income (loss) per ordinary share, Class B ordinary shares | | $ | 0.26 | | | $ | (0.02 | ) | |
|
| |
| | | |
| | | |
| Weighted average shares outstanding of Class B ordinary shares(2) | | | 5,750,000 | | | | 5,000,000 | | |
|
| |
| | | |
| | | |
| Diluted net income (loss) per ordinary share, Class B ordinary shares | | $ | 0.26 | | | $ | (0.02 | ) | |
| (1) | Excluded an aggregate of up to 750,000 Class B ordinary shares that were subject to forfeiture depending on the extent to which the underwriters over-allotment option was exercised. On January 16, 2025, the underwriters exercised their over-allotment option in full as part of the closing of the Initial Public Offering. As such, the 750,000 Founder Shares are no longer subject to forfeiture (see Note 5). | |
| | | |
| (2) | On December 6, 2024, the Sponsor surrendered 1,915,900 Founder Shares for no consideration, such that the initial shareholders own an aggregate of 5,750,000 Founder Shares. All share and per share data has been retroactively presented (see Note 5). | |
*The accompanying notes are an integral part
of the financial statements.*
F-4
PLUM ACQUISITION CORP. IV
STATEMENTS OF CHANGES IN SHAREHOLDERS
DEFICIT
FOR THE YEAR ENDED DECEMBER 31, 2025 AND FOR
THE PERIOD FROM JUNE 10, 2024 (INCEPTION)
THROUGH DECEMBER 31, 2024
|
| |
Class A Ordinary Shares | | |
Class B Ordinary Shares | | |
Additional Paid-in | | |
Accumulated | | |
Total Shareholders | | |
|
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Deficit | | |
| Balance June 10, 2024 (Inception) | | | | | | $ | | | | | | | | $ | | | | $ | | | | $ | | | | $ | | | |
| Issuance of Class B ordinary shares to Sponsor (1)(2) | | | | | | | | | | | 5,750,000 | | | | 575 | | | | 24,425 | | | | | | | | 25,000 | | |
| Net loss | | | | | | | | | | | | | | | | | | | | | | | (91,980 | ) | | | (91,980 | ) | |
| Balance December 31, 2024 | | | | | | $ | | | | | 5,750,000 | | | $ | 575 | | | $ | 24,425 | | | $ | (91,980 | ) | | $ | (66,980 | ) | |
| Remeasurement of Class A ordinary shares subject to redemption | | | | | | | | | | | | | | | | | | | (7,333,504 | ) | | | (12,927,708 | ) | | | (20,261,212 | ) | |
| Sale of Private Placement Units | | | 672,875 | | | | 67 | | | | | | | | | | | | 6,443,683 | | | | | | | | 6,443,750 | | |
| Sale of Restricted Shares | | | 570,000 | | | | 57 | | | | | | | | | | | | 284,943 | | | | | | | | 285,000 | | |
| Fair Value of Public Warrants at issuance | | | | | | | | | | | | | | | | | | | 603,750 | | | | | | | | 603,750 | | |
| Allocated value of transaction costs Private Placement Units, Restricted Shares, and Public Warrants | | | | | | | | | | | | | | | | | | | (60,047 | ) | | | | | | | (60,047 | ) | |
| Share-based compensation | | | | | | | | | | | | | | | | | | | 36,750 | | | | | | | | 36,750 | | |
| Net income (loss) | | | | | | | | | | | | | | | | | | | | | | | 6,051,821 | | | | 6,051,821 | | |
| Balance December 31, 2025 | | | 1,242,875 | | | $ | 124 | | | | 5,750,000 | | | $ | 575 | | | $ | | | | $ | (6,967,867 | ) | | $ | (6,967,168 | ) | |
| (1) | Included an aggregate of up to 750,000 Class B ordinary shares that were subject to forfeiture depending on the extent to which the underwriters over-allotment option was exercised. On January 16, 2025, the underwriters exercised their over-allotment option in full as part of the closing of the Initial Public Offering. As such, the 750,000 Founder Shares are no longer subject to forfeiture (see Note 5). | |
| | | |
| (2) | On December 6, 2024, the Sponsor surrendered 1,915,900 Founder Shares for no consideration, such that the initial shareholders own an aggregate of 5,750,000 Founder Shares. All share and per share data has been retroactively presented (see Note 5). | |
**
*The accompanying notes are an integral part
of the financial statements.*
F-5
PLUM ACQUISITION CORP. IV
STATEMENTS OF CASH FLOWS
|
| |
For the Year Ended December 31, | | |
Forthe
Period from June10, 2024 (Inception)
Through December 31, | | |
|
| |
2025 | | |
2024 | | |
|
Cash Flows from Operating Activities: | |
| | |
| | |
| Net income (loss) | | $ | 6,051,821 | | | $ | (91,980 | ) | |
|
Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | | |
| Payment of expenses through promissory note-related party | | | | | | | | | |
| Payment of formation and operating costs through promissory note related party | | | 8,550 | | | | 20,820 | | |
| Interest earned on investments held in Trust Account | | | (7,060,220 | ) | | | | | |
| Compensation expense | | | 36,750 | | | | | | |
|
Changes in operating assets and liabilities: | |
| | | |
| | | |
| Prepaid expenses | | | 11,724 | | | | | | |
| Due from Sponsor | | | 1,295 | | | | | | |
| Long-term prepaid expenses | | | (3,542 | ) | | | | | |
| Due to officer | | | (12,374 | ) | | | 12,374 | | |
| Accounts payable and accrued expenses | | | 96,490 | | | | 42,445 | | |
| Net cash used in operating activities | | | (869,506 | ) | | | (16,341 | ) | |
|
| |
| | | |
| | | |
|
Cash Flows from Investing Activities: | |
| | | |
| | | |
| Investment of cash into Trust Account | | | (174,225,000 | ) | | | | | |
| Net cash used in investing activities | | | (174,225,000 | ) | | | | | |
|
| |
| | | |
| | | |
|
Cash Flows from Financing Activities: | |
| | | |
| | | |
| Proceeds from sale of founder shares | | | | | | | 25,000 | | |
| Proceeds from sale of Units, net of underwriting discounts paid | | | 169,050,000 | | | | | | |
| Proceeds from sale of Private Placements Units | | | 6,728,750 | | | | | | |
| Proceeds from promissory note - related party | | | 250,000 | | | | | | |
| Repayment of promissory note - related party | | | (285,318 | ) | | | (1,295 | ) | |
| Payment of offering costs | | | (356,541 | ) | | | (3,500 | ) | |
| Net cash provided by financing activities | | | 175,386,891 | | | | 20,205 | | |
|
| |
| | | |
| | | |
| Net Change in Cash | | | 292,385 | | | | 3,864 | | |
| Cash Beginning of period | | | 3,864 | | | | | | |
| Cash End of period | | $ | 296,249 | | | $ | 3,864 | | |
|
| |
| | | |
| | | |
|
Non-cash investing and financing activities: | |
| | | |
| | | |
| Deferred offering costs paid through promissory noterelated party | | $ | 17,300 | | | $ | 129,948 | | |
| Deferred underwriting fee payable | | $ | 6,900,000 | | | $ | | | |
| Deferred offering costs included in accrued offering costs | | $ | | | | $ | 304,904 | | |
*The accompanying notes are an integral part
of the financial statements.*
F-6
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Plum Acquisition Corp. IV (the Company) is a blank check company incorporated as a Cayman Islands exempted corporation on June 10, 2024. The Company was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (Business Combination).
The Company is not limited to a particular industry or geographic region for purposes of completing a Business Combination. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
As of December 31, 2025, the Company had not commenced any operations. All activity for the year ended December 31, 2025 and for the period from June 10, 2024 (inception) through December 31, 2025 relates to the Companys formation and the initial public offering (Initial Public Offering), which is described below, and, after the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering. The Company has selected December 31 as its fiscal year end.
The registration statement for the Companys Initial Public Offering was declared effective on January 14, 2025. On January 16, 2025, the Company consummated the Initial Public Offering of 17,250,000 units (the Units and, with respect to the Class A ordinary shares included in the Units being offered, the Public Shares), which included the full exercise by the underwriters of their over-allotment option in the amount of 2,250,000 Units, at $10.00 per Unit, generating gross proceeds of $172,500,000, which is discussed in Note 3.
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of an aggregate of 672,875 private placement units (each, a Private Placement Unit) at a price of $10.00 per Private Placement Unit, generating gross proceeds of $6,728,750, as follows: (i) by and among the Company and each of the underwriters for the purchase by the underwriters of an aggregate of 232,875 private placement units for an aggregate purchase price of $2,328,750 and (ii) by and between the Company and Plum Partners IV, LLC (the Sponsor) for the purchase by the Sponsor of an aggregate of 440,000 private placement units and 570,000 restricted Class A ordinary shares for an aggregate purchase price of $4,400,000. The private placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in the prospectus.
Transaction costs amounted to $10,932,289, consisting of $3,450,000 of cash underwriting fee, $6,900,000 of deferred underwriting fee, and $582,289 of other offering costs.
The Companys management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Securities, although substantially all of the net proceeds are intended to be applied generally toward completing a Business Combination. The Company must complete its initial Business Combination with one or more target businesses that together have a fair market value equal to at least 80% of the net assets held in the Trust Account (as defined below) (excluding any deferred underwriting commissions held in the Trust Account) at the time of the agreement to enter into a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act). There is no assurance that the Company will be able to successfully effect a Business Combination.
Following the closing of the Initial Public Offering, on January 16, 2025, an amount of $174,225,000 ($10.10 per Unit) from the net proceeds of the sale of the Units and the sale of the Private Placement Securities was placed in the trust account (the Trust Account) and invested or held in either (i) U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries, (ii) uninvested cash, or (iii) an interest bearing bank demand deposit account or other accounts at a bank, as determined by the Company, until the earlier of: (i) the completion of a Business Combination or (ii) the distribution of the funds in the Trust Account to the Companys shareholders, as described below. No later than 18 months after the closing of the Initial Public Offering or such earlier liquidation date as the Companys board of directors may approve, or such later time as provided for in any amendment to the Companys Amended and Restated Memorandum and Articles of Association (an Extension Period), subject to applicable law, the amounts held in the Trust Account are held as cash or cash items, including in demand deposit accounts.
F-7
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
The Company will provide its shareholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a general meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company. The shareholders will be entitled to redeem their shares for a pro rata portion of the amount held in the Trust Account (initially $10.10 per share), calculated as of two business days prior to the completion of a Business Combination, including any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations. There will be no redemption rights upon the completion of a Business Combination with respect to the Companys public warrants.
If the Company seeks shareholder approval in connection with a Business Combination, it receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the shareholders who vote at a general meeting of the Company. If a shareholder vote is not required under applicable law or stock exchange listing requirements and the Company does not decide to hold a shareholder vote for business or other reasons, the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission (SEC), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.
If the Company seeks shareholder approval in connection with a Business Combination, the Sponsor has agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased in or after the Initial Public Offering in favor of approving a Business Combination and to waive its redemption rights with respect to any such shares in connection with a shareholder vote to approve a Business Combination. Additionally, each public shareholder may elect to redeem its Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination.
Notwithstanding the foregoing, if the Company seeks shareholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Companys Amended and Restated Memorandum and Articles of Association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the Exchange Act)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares without the Companys prior written consent.
The Sponsor has agreed to (i) waive its redemption rights with respect to its private placement shares in connection with the completion of the initial business combination, (ii) waive its redemption rights with respect to its private placement shares in connection with a shareholder vote to approve an amendment to the amended and restated memorandum and articles of association (A) to modify the substance or timing of the obligation to allow redemption in connection with the initial Business Combination or to redeem 100% of the public shares if the Company fails to complete the initial Business Combination within 18 months from the closing of the Initial Public Offering or such earlier liquidation date as the Companys board of directors may approve, or during any Extension Period, subject to applicable law or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity and (iii) waive its rights to liquidating distributions from the Trust Account with respect to its private placement shares if the Company fails to complete the initial Business Combination within the prescribed timeframe. In addition, the Sponsor has agreed to vote any private placement shares held by it in favor of the initial Business Combination.
The Company will have until 18 months from the closing of the Initial Public Offering (the Combination Period) to complete a Business Combination. If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than 10 business days thereafter, redeem 100% of the outstanding Public Shares, at a per-share price, payable in cash, including interest earned on the funds held in the Trust Account (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses) and not previously released to the Company to pay its taxes, if any, divided by the number of then-outstanding Public Shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the Companys board of directors, liquidate and dissolve, subject in each case to its obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.
F-8
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
The Sponsor has agreed to waive its liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor acquires Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the initial amount held in the Trust Account ($10.10).
The Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a third party for services rendered or products sold to the Company, or by a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.10 per Public Share or (2) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account nor will it apply to any claims under the Companys indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the Securities Act). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (other than the Companys independent auditors), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Proposed Business Combination
**
*Business Combination Agreement*
On March 8, 2026, the Company entered into a business combination agreement (the Business Combination Agreement) by and among the Company, Plum IV Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company (Merger Sub), and Controlled Thermal Resources Holdings Inc., a Delaware corporation (CTR), pursuant to which, among other things and subject to the terms and conditions contained therein, Merger Sub will merge with and into CTR (the Merger), with CTR continuing as the surviving company. The transactions contemplated by the Business Combination Agreement are referred to in this Annual Report as the Business Combination. The combined companys business is expected to continue to operate through CTR. The proposed Merger is expected to be consummated after receipt of the required approvals by the Companys shareholders and CTRs stockholders and the satisfaction or waiver of certain other customary conditions.
Domestication
At least two (2) business days prior to the Closing Date (as defined in the Business Combination Agreement), subject to the satisfaction or waiver of the conditions of the Business Combination Agreement, the Company will transfer by way of continuation from the Cayman Islands to the State of Delaware and domesticate as a Delaware corporation (Domesticated Plum IV) in accordance with Section 388 of the General Corporation Law of the State of Delaware, as amended, and Part 12 of the Companies Act (as revised) of the Cayman Islands (such continuation and domestication, the Domestication).
By virtue of the Domestication upon its effectiveness, (a) each then issued and outstanding Class A ordinary share, par value $0.0001 per share, of the Company (each a Class A Ordinary Share) (other than any Class A Ordinary Share included in the Cayman Purchaser Units (as defined in the Business Combination Agreement)) shall convert automatically, on a one-for-one basis, into one (1) share of common stock of Domesticated Plum IV (the Domesticated Purchaser Common Stock); (b) each then issued and outstanding Class B ordinary share, par value $0.0001 per share, of the Company (each a Class B Ordinary Share) shall convert automatically, on a one-for-one basis, into one (1) share of Class B common stock of Domesticated Plum IV (the Domesticated Purchaser Class B Common Stock); (c) each then issued and outstanding warrant of the Company (other than any Cayman Purchaser Public Warrants (as defined in the Business Combination Agreement)) included in the Cayman Purchaser Units) (each a Cayman Purchaser Warrant) shall convert automatically into a warrant to acquire one (1) share of Domesticated Purchaser Common Stock (each a Domesticated Purchaser Warrant), pursuant to the Warrant Agreement (as defined in the Business Combination Agreement); and (d) each then issued and outstanding Cayman Purchaser Unit shall be cancelled and will thereafter entitle the holder thereof to one (1) share of Domesticated Purchaser Common Stock and one-half of one (1) Domesticated Purchaser Warrant, in each case without any action on the part of the Company, Merger Sub, the Company or any holder of securities of any of the foregoing.
F-9
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
The Merger and Consideration
Following the Domestication, at the Effective Time (as defined in the Business Combination Agreement), by virtue of the Merger, each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time shall be automatically cancelled and extinguished and converted into one (1) share of common stock, par value $0.0001 per share, of the surviving company.
Subject to, and in accordance with the terms and conditions of the Business Combination Agreement, at the Effective Time (as defined in the Business Combination Agreement):
| (vi) | each share of common stock of CTR (the CTR Common Stock) issued and outstanding (or deemed to be issued and outstanding under the terms of the Business Combination Agreement) immediately prior to the Effective Time, except for (a) shares held by the Company or Merger Sub (or any subsidiaries of the Company), (b) shares held by the CTR as treasury stock, if any (each share covered in subclause (a) and (b), an Excluded Share), (c) shares held by stockholders who have properly exercised and not withdrawn appraisal rights under Delaware law (the Dissenting Shares), and (d) shares of CTR Common Stock issued pursuant to an award of restricted stock that is, as of immediately prior to the Closing Date (as defined in the Business Combination Agreement), subject to a substantial risk of forfeiture and is not transferable (the CTR Restricted Shares), will be cancelled and converted into the right to receive the Per Share Merger Consideration (as defined in the Business Combination Agreement); | |
| (vii) | each Excluded Share shall be automatically cancelled and retired without any conversion thereof and shall cease to exist, and no consideration shall be delivered in exchange therefor; | |
| (viii) | each option to purchase shares of the CTR Common Stock (the CTR Option) that is outstanding immediately prior to the Effective Time will be automatically assumed by Domesticated Plum IV and converted into an option to purchase a number of shares of Domesticated Purchaser Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of CTR Common Stock subject to such CTR Option immediately prior to the Effective Time and (y) the Exchange Ratio (as defined in the Business Combination Agreement), at an exercise price per share (rounded up to the nearest whole cent) equal to the quotient of (A) the exercise price per share of such CTR Option immediately prior to the Effective Time divided by (B) the Exchange Ratio; | |
| (ix) | each award of the CTR Restricted Shares (the CTR Restricted Share Award) that is outstanding immediately prior to the Effective Time will be automatically assumed by Domesticated Plum IV such that each CTR Restricted Share Award will be converted into an award for a number of restricted shares of Domesticated Purchaser Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of CTR Restricted Shares and (y) the Exchange Ratio; and | |
| (x) | each warrant to purchase shares of the CTR Common Stock (the CTR Warrant) that is outstanding immediately prior to the Effective Time will be automatically assumed by the Domesticated Plum IV such that, as of the Effective Time, each CTR Warrant shall instead be converted into a warrant to purchase a number of shares of Domesticated Purchaser Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of CTR Common Stock issuable upon exercise of such CTR Warrant and (y) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to the quotient of (A) the exercise price per share of such CTR Warrant immediately prior to the Effective Time divided by (B) the Exchange Ratio. | |
The Class B Conversion
At the Effective Time, by virtue of the Merger and the applicable provisions of the certificate of incorporation of Domesticated Plum IV (the Domesticated Purchaser Charter), each share of Domesticated Purchaser Class B Common Stock then issued and outstanding shall be automatically cancelled and extinguished and converted into one (1) share of Domesticated Purchaser Common Stock.
*Transaction Support Agreement*
Simultaneously with the execution and delivery of the Business Combination Agreement, the Company and certain stockholders of CTR, who collectively have the right to cast at least 60% of the votes entitled to be cast at a special meeting of CTRs stockholders (collectively, the Supporting CTR Stockholders) entered into a Transaction Support Agreement (the Transaction Support Agreement), pursuant to which the Supporting CTR Stockholders have agreed, among other things, to vote all of their shares of CTRs common stock in favor of adopting and approving the Business Combination Agreement and the Business Combination.
F-10
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
*Registration Rights Agreement*
In connection with the Business Combination, simultaneously with the closing of the Business Combination (the Closing), the Company and certain holders will enter into an amended and restated Registration Rights Agreement (the Amended and Restated Registration Rights Agreement) that amends and restates the Registration Rights Agreement, dated January 14, 2025, by and among the Company, the Sponsor and certain other security holders named therein, pursuant to which, among other things, (i)the Company will agree to file, as soon as practicable (and in any event within thirty (30) calendar days) following the closing date, a registration statement covering the resale of certain equity securities held by the Sponsor and such other securityholders parties thereto; and (ii)such holders of registrable securities will be granted certain takedown, demand, block trade and piggyback registration rights with respect to their registrable securities, in each case, on the terms and subject to the conditions set forth in the Amended and Restated Registration Rights Agreement.
*Lock-Up Agreement*
In connection with the Business Combination, simultaneously with the closing, the Company, the Sponsor and certain stockholders of CTR (such holders, collectively, the Lock-Up Parties) will enter into a Lock-Up Agreement (the Lock-Up Agreement). The Lock-Up Agreement will provide that, during the applicable Lock-Up Period (as defined in the Lock-Up Agreement), subject to certain exceptions, the Lock-Up Parties will not, with respect to the Lock-Up Securities (as defined in the Lock-Up Agreement), (i) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidation with respect to or decrease a call equivalent position, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii) publicly announce the intention to effect any transaction specified in clause (i) or (ii).
Risks and Uncertainties
The Companys ability to complete an initial Business Combination may be adversely affected by various factors, many of which are beyond the Companys control. The Companys ability to consummate an initial Business Combination could be impacted by, among other things, changes in laws or regulations, downturns in the financial markets or in economic conditions, inflation, fluctuations in interest rates, increases in tariffs, supply chain disruptions, declines in consumer confidence and spending, public health considerations, and geopolitical instability, such as the military conflicts in Ukraine and the Middle East. The Company cannot at this time predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact the Companys ability to complete an initial Business Combination.
NOTE 2SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements are presented in U.S. dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and pursuant to the accounting and disclosure rules and regulations of the Securities and Exchange Commission (the SEC).
Liquidity and Going Concern
As of December 31, 2025, the Company had $296,249 in cash and working capital deficit of $70,710. Further, the Company has incurred and expects to continue to incur significant costs in pursuit of its acquisition plans. There is no assurance that the Companys plans to raise capital will be successful. Further, the Company has until July 14, 2026 to complete its initial business combination or it will liquidate absent any shareholder approved extensions. In connection with the Companys assessment of going concern considerations in accordance with Accounting Standards Codification (ASC) Topic 205-40, Presentation of Financial Statements - Going Concern, as of December 31, 2025, management has determined that mandatory liquidation, should a Business Combination not occur, and potential subsequent dissolution and the liquidity condition issue raise substantial doubt about the Companys ability to continue as a going concern for one year from the date the financial statements are issued.
No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after the Combination Period. The Company cannot assure that its plans to raise capital or to consummate an Initial Business Combination will be successful.
F-11
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
Emerging Growth Company
The Company is an emerging growth company, as defined in Section2(a)of the Securities Act, as modified by the Jumpstart Our Business Startups Actof2012 (the JOBS Act), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section404 of the Sarbanes-Oxley Actof2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
**
Further, Section102(b)(1)of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the ExchangeAct) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Companys financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting periods.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of threemonths or less when purchased to be cash equivalents. The Company had $30,000 and $3,864 in cash as of December 31, 2025 and 2024, respectively. The Company had $266,249 and $0 in cash equivalents as of December 31, 2025 and 2024, respectively.
Investments Held in Trust Account
**
As of December 31, 2025 and 2024, the investments held in the Trust Account, amounting to $181,285,220 and $0, were held in U.S. government treasury bills, respectively.
Offering Costs
The Company complies with the requirements of the Financial Accounting Standards Board (FASB) ASC340-10-S99 and SEC Staff Accounting Bulletin Topic5A,Expenses of Offering. Offering costs consist principally of professional and registration fees that are directly related to the Initial Public Offering. FASBASC470-20, Debt with Conversion and Other Options, addresses the allocation of proceeds from the issuance of convertible debt into its equity and debt components. The Company applies this guidance to allocate Initial Public Offering proceeds from the Unitsbetween ClassA ordinary shares and warrants, using the residual method by allocating Initial Public Offering proceeds first to assigned value of the warrants and then to the ClassA ordinary shares. Offering costs allocated to the Public Shares were charged to temporary equity, and offering costs allocated to Public Warrants (as defined below) and Private Placement Units and Restricted Shares were charged to shareholders deficit as the Public and Private Placement Warrants (as defined below), after managements evaluation, were accounted for under equity treatment.
F-12
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
Income Taxes
The Company accounts for income taxes under ASC740, Income Taxes (ASC740). ASC740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprises financial statement and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2025 and 2024. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company has been subject to income tax examinations by major taxing authorities since inception.
The Company is considered an exempted Cayman Islands Company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the UnitedStates. As such, the Companys tax provision was zero for the periods presented.
Net Income (Loss) per Ordinary Share
Net income (loss) per ordinary share is computed by dividing net income (loss) by the weighted average number of ordinary shares issued and outstanding during the period, excluding ordinary shares subject to forfeiture. Weighted average shares were reduced for the effect of an aggregate of 750,000 Class B ordinary shares that were subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised (see Note 5). At December 31, 2025 and 2024, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company. As a result, diluted income (loss) per ordinary share is the same as basic income(loss) per ordinary share for the period presented.
The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):
| | | For the Year Ended December 31, 2025 | | | For the Period from June 10, 2024 (Inception) Through December 31, 2024 | | |
| | | Class A | | | Class B | | | Class A | | | Class B | | |
| Basic net income (loss) per share of common stock: | | | | | | | | | | | | | | | | | |
| Numerator: | | | | | | | | | | | | | | | | | |
| Allocation of net income | | $ | 4,575,869 | | | $ | 1,475,952 | | | $ | | | | $ | (91,980 | ) | |
| Denominator: | | | | | | | | | | | | | | | | | |
| Weighted-average shares outstanding | | | 17,730,806 | | | | 5,719,093 | | | | | | | | 5,000,000 | | |
| Basic net income (loss) per ordinary share | | $ | 0.26 | | | $ | 0.26 | | | $ | | | | $ | (0.02 | ) | |
F-13
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
| | | For the Year Ended December 31, 2025 | | | For the Period from June 10, 2024 (Inception) Through December 31, 2024 | | |
| | | Class A | | | Class B | | | Class A | | | Class B | | |
| Diluted net income (loss) per share of common stock: | | | | | | | | | | | | | |
| Numerator: | | | | | | | | | | | | | |
| Allocation of net income (loss) | | $ | 4,569,846 | | | $ | 1,481,975 | | | $ | | | | $ | (91,980 | ) | |
| Denominator: | | | | | | | | | | | | | | | | | |
| Weighted-average shares outstanding | | | 17,730,806 | | | | 5,750,000 | | | | | | | | 5,000,000 | | |
| Diluted net income (loss) per ordinary share | | $ | 0.26 | | | $ | 0.26 | | | $ | | | | $ | (0.02 | ) | |
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times may exceed the Federal Depository Insurance Corporation coverage of $250,000. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Companys financial condition, results of operations, and cash flows.
Fair Value of Financial Instruments
The fair value of the Companys assets and liabilities, which qualify as financial instruments under ASC Topic820, Fair Value Measurement, approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature.
Warrant Instruments
The Company will account for the Public and Private Placement Warrants issued in connection with the Initial Public Offering, on January 16, 2025 and the private placement in accordance with the guidance contained in FASB ASC Topic815, Derivatives and Hedging. Accordingly, the Company evaluated and classified the warrant instruments under equity treatment at their assigned values.
The fair value of the Public Warrants was $603,750, or $0.07 per Public Warrant. The fair value of Public Warrants was determined using Monte Carlo Simulation Model. The Public Warrants have been classified within shareholders deficit and will not require remeasurement after issuance. The following table presents the quantitative information regarding market assumptions used in the Level 3 valuation of the Public Warrants:
| | | January 16, 2025 | | |
| Underlying stock price | | $ | 9.98 | | |
| Exercise price | | $ | 11.50 | | |
| Remaining term (years) | | | 6.74 | | |
| Annual volatility | | | 2.9 | % | |
| Annual risk-free rate | | | 4.39 | % | |
| Pre-adjusted value per share | | $ | 1.43 | | |
| Market adjustment | | | 5.0 | % | |
F-14
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
Class A Ordinary Shares Subject to Possible Redemption Classification
The public shares contain a redemption feature which allows for the redemption of such public shares in connection with the Companys liquidation, or if there is a shareholder vote or tender offer in connection with the Companys initial Business Combination. In accordance with ASC 480-10-S99, the Company classifies public shares subject to possible redemption outside of permanent deficit as the redemption provisions are not solely within the control of the Company. The Company recognizes changes in redemption value immediately as it occurs and will adjust the carrying value of redeemable shares to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value. The change in the carrying value of redeemable shares will result in charges against additional paid-in capital (to the extent available) and accumulated deficit. Accordingly, as of December 31, 2025, Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders deficit section of the Companys balance sheets. As of December 31, 2025, the Class A ordinary shares subject to possible redemption reflected in the balance sheets are reconciled in the following table:
| Gross proceeds | | $ | 172,500,000 | | |
| Less: | | | | | |
| Proceeds allocated to Public Warrants | | | (603,750 | ) | |
| Public Shares issuance costs | | | (10,872,242 | ) | |
| Plus: | | | | | |
| Accretion of carrying value to redemption value | | | 20,261,212 | | |
| ClassA ordinary shares subject to possible redemption, December 31, 2025 | | $ | 181,285,220 | | |
Share-Based Compensation
The Company records share-based compensation in accordance with FASB ASC Topic 718, Compensation-Share Compensation (ASC 718), guidance to account for its share-based compensation. It defines a fair value-based method of accounting for an employee share option or similar equity instrument. The Company recognizes all forms of share-based payments at their fair value on the grant date, which are based on the estimated number of awards that are ultimately expected to vest. Share-based payments are valued using a Black-Scholes option pricing model. Grants of share-based payment awards issued to non-employees for services rendered have been recorded at the fair value of the share-based payment, which is the more readily determinable value. The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. If an award is granted, but vesting does not occur, any previously recognized compensation cost is reversed in the period related to the termination of service. Share-based compensation expenses are included in costs and operating expenses depending on the nature of the services provided in the statements of operations.
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, Derivatives and Hedging. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheets as current or non-current based on whether or not net cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. The underwriters over-allotment option is deemed to be a freestanding financial instrument indexed on the contingently redeemable shares and would have been accounted for as a liability pursuant to ASC 480 if not fully exercised at the time of the Initial Public Offering. Because the over-allotment option was fully exercised at the time of the Initial Public Offering, no liability remained outstanding subsequent to the offering date.
Recently Issued Accounting Standards
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 Companys financial statements.
F-15
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
NOTE 3 INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering on January 16, 2025, the Company sold 17,250,000Public Shares, which includes a full exercise by the underwriters of their over-allotment option at a purchase price of $10.00 per Unit. Each Unit consists of one ClassA ordinary share and one-half of one redeemable public warrant (Public Warrant). Each whole Public Warrant entitles the holder to purchase one ClassA ordinary share at an exercise price of $11.50 per share, subject to adjustment (see Note6).
NOTE 4PRIVATE PLACEMENT
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of an aggregate of 672,875 private placement units (each, a Private Placement Unit) at a price of $10.00 per Private Placement Unit, or Non-Managing Investor Private Placement Security (as defined below) generating gross proceeds of $6,728,750, as follows: (i) by and among the Company and each of the underwriters for the purchase by the underwriters of an aggregate of 232,875 Private Placement units for an aggregate purchase price of $2,328,750 and (ii) by and between the Company and the Sponsor for the purchase by the Sponsor of an aggregate of 440,000 Private Placement Units and 570,000 restricted Class A ordinary shares (the Restricted Private Placement Shares, the Restricted Private Placement Shares together with the Private Placement Units purchased by the Sponsor, collectively, the Non-Managing Investor Private Placement Securities) for an aggregate purchase price of $4,400,000.
Each Private Placement Unit has an offering price of $10.00 and consists of one ClassA ordinary share and one-half of one redeemable Public Warrant. Each whole Public Warrant entitles the holder to purchase one ClassA ordinary share at a price of $11.50 per share. The proceeds from the sale of the Private Placement Units and the Non-Managing Investor Private Placement Securities were added to the net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Units and the Non-Managing Investor Private Placement Securities held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants expire worthless.
The Restricted Private Placement Shares are held by the Sponsor and will be transferred to the non-managing investors (or their designees) only upon the consummation of an initial business combination. Other than such permitted transfer, the Restricted Private Placement Shares will be subject to transfer restrictions for 90 days following the initial business combination and will be entitled to registration rights.
The fair value of the Restricted Private Placement Shares is $285,000, or $0.50 per Restricted Private Placement Shares. The fair value of the Restricted Private Placement Shares was determined using Monte Carlo Simulation Model. The Restricted Private Placement Shares have been classified within shareholders deficit and will not require remeasurement after issuance. The following table presents the quantitative information regarding market assumptions used in the valuation of the Restricted Private Placement Shares:
| | | January 16, 2025 | | |
| Unit value | | $ | 10.02 | | |
| Volatility | | | 2.9 | % | |
| Risk free rate | | | 4.39 | % | |
| Public warrant value | | $ | 0.04 | | |
| Implied stock value | | $ | 9.98 | | |
| Market adjustment | | | 5.0 | % | |
F-16
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
NOTE 5RELATED PARTY TRANSACTIONS
Founder Shares
**
On June26, 2024, the Sponsor paid $25,000, or approximately $0.003 per share in consideration for 7,665,900 ClassB ordinary shares (the Founder Shares) issued to the Sponsor. On December 6, 2024, the Sponsor surrendered 1,915,900 Founder Shares for no consideration. All share and per share amounts have been retroactively restated. The initial shareholders currently hold an aggregate of 5,750,000 Founder Shares.
The Founder Shares included an aggregate of up to 750,000 shares subject to forfeiture by the holders thereof depending on the extent to which the underwriters over-allotment option was exercised, so that the number of Founder Shares would have collectively represented 25% of the Companys issued and outstanding shares upon the completion of the Initial Public Offering (not including the Restricted Private Placement Shares). On January 16, 2025, the underwriters exercised their over-allotment option in full as part of the closing of the Initial Public Offering. As such, the 750,000 Founder Shares are no longer subject to forfeiture.
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Founder Shares until the earlier to occur of (A)one year after the completion of a Business Combination; and (B)subsequent to a Business Combination, (x)if the last reported sale price of the ClassA ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20trading days within any 30-tradingday period commencing at least 150days after a Business Combination, or (y)the date on which the Company completes a liquidation, merger, amalgamation, share exchange, reorganization or other similar transaction that results in all of the Companys shareholders having the right to exchange their ClassA ordinary shares for cash, securities or other property.
**
During July and August 2024, the Sponsor transferred 75,000 Founder Shares to three director nominees (25,000 shares each) for an aggregate amount of $225, or approximately $0.003 per share. The sale of the Founder Shares to the Companys directors and directors nominees is in the scope of FASB ASC Topic 718, Compensation-Stock Compensation (ASC 718). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the 75,000 shares granted to the Companys director nominees was $36,750 or $0.49 per share. The Founder Shares were granted subject to a performance condition (i.e., named as directors at the occurrence of the Initial Public Offering). Compensation expense related to the Founder Shares is recognized only when the performance condition is probable of occurrence under the applicable accounting literature. Stock-based compensation was recognized upon the consummation of the Initial Public Offering in an amount equal to the number of Founder Shares times the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of the Founder Shares.
**
Promissory NoteRelated Party
On June26, 2024, the Company issued an unsecured promissory note to the Sponsor (as amended on January 6, 2025, the Promissory Note), pursuant to which the Company may borrow up to an aggregate principal amount of $500,000. The Promissory Note is non-interest bearing and payable on the earlier of (i)February 1, 2025 (as amended) or (ii)the consummation of the Initial Public Offering. As of January 16, 2025, the Company owed $284,023, which was repaid simultaneously with the closing of the Initial Public Offering. The Company paid the Sponsor a note balance of $285,318 causing an overpayment of $1,295. On January 22, 2025, the Sponsor returned $1,295 to the Company. Borrowings under this note are no longer available. As of December 31, 2025 and 2024, there were $0 and $149,473, outstanding under the Promissory Note, respectively.
On July 8, 2025, the Company issued an unsecured promissory note (the Note) in the principal amount of up to $1,500,000 to Sponsor which may be drawn down from time to time prior to the Maturity Date (as defined below) upon request by the Company. The Note does not bear interest and the principal balance will be payable on the date on which the Company consummates its Business Combination (the Maturity Date). In the event the Company consummates the Business Combination, the Sponsor has the option on the Maturity Date to convert the principal outstanding under the Note into that number of ordinary shares of the post-business combination company (the New PubCo Shares). The number of New PubCo Shares to be received by the Sponsor in connection with such optional conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount (or portion thereof) payable to such Sponsor by (y) $10.00. The Note is subject to customary events of default, the occurrence of certain of which automatically triggers the unpaid principal balance of the Note and all other sums payable with regard to the Note becoming immediately due and payable.
The Company accounts for the Note as a liability under ASC 470. The Company has not elected the fair value option under ASC 825-10. The embedded conversion feature is indexed to the Companys own stock, meets the fixed-for-fixed criteria, and is not required to be bifurcated under ASC 815-15. Accordingly, the conversion feature qualifies for equity classification under ASC 815-40, provided there are sufficient authorized shares to settle the conversion, and no cash settlement contingencies exist. As a result, the Note is recognized at its principal amount, net of issuance costs, and presented and disclosed in accordance with ASC 470.
Concurrently with the issuance of the Note, the Company drew an initial amount of $250,000.As of December 31, 2025 and 2024, there were $250,000 and $0, outstanding under the Note, respectively.
F-17
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
Due to Officer
As of December 31, 2025 and 2024, the Company owes an officer of the Company $0 and $12,374 for travel related expenses, respectively.
Consulting Services
The Chief Executive Officer and the Chief Financial Officer entered into agreements with the Company, commencing on January 16, 2025 through the closing of the Companys Business Combination, to pay each officer an aggregate of $20,833 per month, subject to availability of sufficient funds from working capital held outside the Trust Account. For the year ended December 31, 2025, the Company incurred approximately $479,000 in consulting fees to the officers. For the period from June 10, 2024 through December 31, 2024, there was no consulting fees incurred. As of December 31, 2025 and 2024, approximately $31,000 and $0 in unpaid consulting fees has been accrued and recorded under accrued expenses in the accompanying balance sheets, respectively.
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, any of their respective affiliates or certain of the Companys directors and officers may, but are not obligated to, loan the Company funds as may be required (Working Capital Loans). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lenders discretion, up to $1,500,000 of such Working Capital Loans may be convertible into units at a price of $10.00 per unit. The units would be identical to the Private Placement Units. As of December 31, 2025 and 2024, there are no Working Capital Loans outstanding.
NOTE 6COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the (i)Founder Shares, (ii) Restricted Private Placement Shares, (iii)Private Placement Units, issued in a private placement simultaneously with the closing of the Initial Public Offering, private placement shares, private placement warrants and the ClassA ordinary shares underlying such private placement warrants and (iv)private placement units that may be issued upon conversion of working capital loans are entitled to registration rights pursuant to a registration rights agreement signed on the effective date of the Initial Public Offering requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to ClassA ordinary shares). The holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have certain piggyback registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule415 under the Securities Act. However, the registration rights agreement provides that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until termination of the applicable lock-up period. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Companys securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
F-18
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
Underwriting Agreement
The Company has granted the underwriters a 45-day option to purchase up to 2,250,000 additional Unitsto cover over-allotments at the Initial Public Offering price, less the underwriting commissions. As of January 16, 2025, simultaneously with the closing of the Initial Public Offering, the underwriters elected to fully exercise the over-allotment option to purchase the additional 2,250,000 Units at a price of $10.00 per Unit
The underwriters were entitled to (1) an underwriting discount of $0.20 per Unit, or $3,450,000 in the aggregate, of which (i)$0.065 per unit was paid to the underwriters in cash at the closing of the Initial Public Offering and (ii)$0.135 per Unit was used by the underwriters to purchase Private Placement Units, and (2) a deferred fee of $0.40perUnit, or $6,900,000. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement and will be based on the amount of funds remaining in the Trust Account after shareholder redemptions of public shares in connection with the consummation of a Business Combination.
WarrantsAs of December 31, 2025, there were 8,961,438 warrants outstanding, including 8,625,000 Public Warrants and 336,438 Private Placement Warrants. Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable on the later of (a)30days after the completion of a Business Combination and (b)12months from the closing of the Initial Public Offering. The Public Warrants will expire sevenyears from the completion of a Business Combination or earlier upon redemption or liquidation.
The Company will not be obligated to deliver any ClassA ordinary shares pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the ClassA ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating thereto is available, subject to the Company satisfying its obligations with respect to registration, or a valid exemption from registration is available. No warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available.
The Company has agreed that as soon as practicable, but in no event later than 15business days, after the closing of a Business Combination, it will use its commercially reasonable efforts to file with the SEC a registration statement covering the issuance, under the Securities Act, of the ClassA ordinary shares issuable upon exercise of the warrants, and the Company will use its commercially reasonable efforts to cause the same to become effective within 60business days after the closing of a Business Combination and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant agreement. Notwithstanding the above, if the ClassA ordinary shares are, at the time of any exercise of a warrant, not listed on a national securities exchange such that they satisfy the definition of a covered security under Section18(b)(1)of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a cashless basis in accordance with Section3(a)(9)of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
*Redemption of Public Warrants*Once the warrants become exercisable, the Company may redeem the outstanding Public Warrants:
| | | in whole and not in part; | |
| | | at a price of $0.01 per Public Warrant; | |
| | | upon not less than 30days prior written notice of redemption to each warrant holder; and | |
| | | if, and only if, the closing price of the ClassA ordinary shares equals or exceeds $18.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20trading days within a 30-tradingday period ending on the thirdtrading day prior to the date on which the Company sends the notice of redemption to warrant holders. | |
F-19
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
The Company will not redeem the warrants for cash unless a registration statement under the Securities Act covering the issuance of the shares of ClassA ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those ClassA ordinary shares is available throughout the 30-day redemption period or the Company has elected to require the exercise of the public warrants on a cashless basis. If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if the Company is unable to register or qualify the underlying securities for sale under all applicable state securities laws.
If the Company calls the warrants for redemption as described in this paragraph, its management will have the option to require any holder that wishes to exercise his, her or its warrant following the notice of redemption to do so on a cashless basis. In the case of such a cashless exercise, each holder would pay the exercise price by surrendering the Public Warrants for that number of ClassA ordinary shares equal to the quotient obtained by dividing (x)the product of the number of ClassA ordinary shares underlying the warrants, multiplied by the excess of the fair market value less the exercise price of the warrants by (y)the fair market value. The fair market value as used in the preceding sentence shall mean the volume weighted average price of the ClassA ordinary shares for the 10trading days ending on thetrading day prior to the date on which the notice of redemption is sent to the holders of the public warrants. If its management takes advantage of this option, the notice of redemption will contain the information necessary to calculate the number of shares of ClassA ordinary shares to be received upon exercise of the warrants, including the fair market value in such case.
The Company has established the $18.00 per share (as adjusted) redemption criterion discussed above to prevent a redemption call unless there is at the time of the call a significant premium to the public warrant exercise price. If the foregoing conditions are satisfied and the Company issues a notice of redemption of the Public Warrants, each Public Warrant holder will be entitled to exercise his, her or its Public Warrant prior to the scheduled redemption date. However, the price of the ClassA ordinary shares may fall below the $18.00 redemption trigger price as well as the $11.50 Public Warrant exercise price after the redemption notice is issued.
In addition, if (x)the Company issues additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of its Initial Business Combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue price or effective issue price to be determined in good faith by its board of directors and, in the case of any such issuance to either of the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price), (y)the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of its Initial Business Combination on the date of the completion of its Initial Business Combination (net of redemptions), and (z)the volume weighted average trading price of ClassA ordinary shares during the 20trading day period starting on thetrading day prior to theday on which the Company consummates its initial business combination (such price, the Market Value) is below $9.20 per share, the exercise price of the public warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.
The Private Placement Warrants are identical to the Public Warrants underlying the Unitsbeing sold in the Initial Public Offering, except that the Private Placement Warrants and the ClassA ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable.
F-20
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
NOTE 7SHAREHOLDERS DEFICIT
Preference SharesThe Company is authorized to issue 1,000,000 preference shares with a par value of $0.0001 per share, with such designations, voting and other rights and preferences as may be determined from time to time by the Companys board of directors. At December 31, 2025 and 2024, there were no preference shares issued or outstanding.
ClassA Ordinary SharesThe Company is authorized to issue 200,000,000 ClassA ordinary shares, with a par value of $0.0001 per share. Holders of ClassA ordinary shares are entitled to one vote for each share. At December 31, 2025 and 2024, there are 1,242,875 ClassA ordinary shares issued and outstanding, excluding 17,250,000 Class A ordinary shares subject to redemption.
ClassB Ordinary SharesThe Company is authorized to issue 20,000,000 ClassB ordinary shares, with a par value of $0.0001 per share. Holders of the ClassB ordinary shares are entitled to one vote for each share. At December 31, 2025 and 2024, there were 5,750,000 ClassB ordinary shares issued and outstanding (see Note5).
Only holders of ClassB ordinary shares will have the right to vote on the election of directors prior to the Business Combination. Holders of ClassA ordinary shares and holders of ClassB ordinary shares will vote together as a single class on all other matters submitted to a vote of the Companys shareholders except as otherwise required by law.
The ClassB ordinary shares will automatically convert into ClassA ordinary shares at the time of a Business Combination or earlier at the option of the holder, on a one-for-one basis, subject to adjustment.
NOTE 8 FAIR VALUE MEASUREMENTS
The fair value of the Companys financial assets and liabilities reflects managements estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
| | Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
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| | Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
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| | Level 3: | Unobservable inputs based on assessment of the assumptions that market participants would use in pricing the asset or liability. | |
The following table presents information about the Companys assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2025 and indicates the fair value hierarchy of the valuation techniques that the Company utilized to determine such fair value:
| | | Maturity Date: | | Level | | December31, 2025 | | |
| Asset: | | | | | | | | | |
| Investments held in Trust Account U.S. Treasury Securities | | January 8, 2026 | | 1 | | $ | 181,285,220 | | |
F-21
PLUM ACQUISITION CORP. IV
NOTES TO THE FINANCIAL STATEMENTS
NOTE 9 SEGMENT REPORTING
ASC Topic 280, Segment Reporting, establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise that engage in business activities from which it may recognize revenues and incur expenses, and for which separate financial information is available that is regularly evaluated by the Companys chief operating decision maker (CODM), or group, in deciding how to allocate resources and assess performance.
The Companys CODM has been identified as the Chief Financial Officer, who reviews the assets, operating results, and financial metrics for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, management has determined that there is only one reportable segment.
The CODM assesses performance for the single segment and decides how to allocate resources based on net income or loss that also is reported on the statements of operations as net income or loss. The measure of segment assets is reported on the balance sheets as total assets. When evaluating the Companys performance and making key decisions regarding resource allocation, the CODM reviews the below key metric included in net income or loss:
| | | For the Year Ended December 31, 2025 | | | For the Period from June 10, 2024 (Inception) Through December31, 2024 | | |
| General and administrative expenses | | $ | 1,021,268 | | | $ | 91,980 | | |
| Interest earned on marketable securities held in Trust Account | | | 7,060,220 | | | | | | |
| | | As of December 31, 2025 | | | As of December 31, 2024 | | |
| Cash | | $ | 296,249 | | | $ | 3,864 | | |
| Investments held in Trust Account | | | 181,285,220 | | | | | | |
General and administrative expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a business combination or similar transaction within the business combination period. The CODM also reviews general and administrative expenses to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget. General and administrative expenses, as reported on the statements of operations, are the significant segment expenses provided to the CODM on a regular basis.
All other segment items included in net income or loss are reported on the statements of operations and described within their respective disclosures.
NOTE 10 SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued on March 31, 2026. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements.
On March 8, 2026, the Company entered into the Business Combination Agreement, by and among the Company, Plum IV Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of Plum IV, and Controlled Thermal Resources Holdings Inc., a Delaware corporation, pursuant to which, Merger Sub will merge with and into CTR, with CTR continuing as the surviving company.
F-22
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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Plum Acquisition Corp. IV | |
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Dated: March 31, 2026 |
By: |
/s/ Kanishka Roy | |
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Kanishka Roy | |
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Chief Executive Officer | |
Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in
the capacities indicated on March 31, 2026.
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/s/ Kanishka Roy |
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Chairman and Chief Executive Officer |
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March 31, 2026 | |
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Kanishka Roy |
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(Principal Executive Officer) |
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/s/ Steven Handwerker |
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Chief Financial Officer and Director |
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March 31, 2026 | |
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Steven Handwerker |
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(Principal Financial Officer) |
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/s/ Aidin Aghamiri |
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Director |
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March 31, 2026 | |
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Aidin Aghamiri |
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/s/ Allan Chou |
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Director |
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March 31, 2026 | |
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Allan Chou |
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/s/ Anjai Gandhi |
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Director |
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March 31, 2026 | |
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Anjai Gandhi |
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/s/ Avanish Sahai |
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Director |
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March 31, 2026 | |
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Avanish Sahai |
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