Financial Overview - The company raised $250 million in gross proceeds for its initial public offering, compared to the $300 million targeted by New Providence Acquisition Corp. III (NPA III) [28]. - The company has no operating history and no revenues, which presents a challenge in evaluating its ability to achieve business objectives [14]. - The initial trust account amount is approximately $10.20 per public share, which will be used for redemptions upon completion of the initial business combination [86]. - As of December 31, 2022, the company had approximately $339,663 in proceeds held outside the trust account, which may be used for costs associated with dissolution and creditor payments [106]. - The expected per-share redemption amount upon dissolution is approximately $10.20, but this could be lower due to creditor claims against the trust account [107]. Business Combination Strategy - The company intends to pursue a business combination in the consumer sector, leveraging its management team's extensive experience and relationships [33]. - The management team plans to utilize a proactive sourcing strategy to identify and evaluate business combination opportunities [34]. - The company has identified acquisition criteria focusing on market leadership, revenue growth, strong cash flow potential, and underutilized balance sheets [38]. - The initial business combination will utilize funds available amounting to $246,250,000 after estimated expenses, providing options for liquidity events and capital for growth [59]. - The management team intends to conduct thorough due diligence, including financial data reviews and discussions with stakeholders, to evaluate prospective business combinations [40]. Risks and Challenges - The company may face challenges in completing its initial business combination due to the COVID-19 pandemic and other market uncertainties [19]. - The company may not be able to complete its initial business combination if the net proceeds from the IPO are insufficient to operate for 18 months [26]. - The company has not secured third-party financing for its initial business combination, which may pose risks [59]. - The company may face bankruptcy risks that could affect the trust account, potentially preventing the return of $10.20 per share to public stockholders [119]. - The company is subject to competition from other entities, including blank check companies and private equity groups, which may have greater resources and experience [123]. Shareholder Rights and Redemption - Public stockholders may only receive approximately $10.20 per share upon redemption, or less in certain circumstances, if the initial business combination is not completed [25]. - Public stockholders can redeem their shares for a pro rata share of the trust account, which includes interest earned, subject to certain limitations [86]. - Redemption rights are limited to 15% of the shares sold in the initial public offering for any single stockholder or group acting in concert, to prevent large block accumulations [97]. - The company will not redeem shares if it would cause net tangible assets to fall below $5,000,001 after payment of underwriter's fees and commissions [95]. - If the initial business combination is not approved, stockholders who elected to redeem their shares will not be entitled to any redemption [102]. Management and Governance - The management team has a proven track record in identifying undervalued companies and maximizing their operating results, having previously completed a business combination with AST on April 6, 2021 [29]. - The company has three officers who will devote time as necessary until the completion of the initial business combination [31]. - The management team will actively engage in direct operations to instill accountability and align management interests with shareholder value [53]. - Post-merger, the management team plans to enhance shareholder value through corporate governance, operational efficiencies, and strategic acquisitions [51]. - The management team anticipates that the initial business combination will allow for greater flexibility in capital structure and operational growth [59]. Regulatory and Reporting Obligations - The company has reporting obligations under the Exchange Act, including filing annual, quarterly, and current reports with the SEC [124]. - The company is classified as an "emerging growth company," allowing it to take advantage of certain exemptions from reporting requirements [127]. - The company will remain an emerging growth company until it meets specific revenue or market value thresholds, including total annual gross revenue of at least $1.07 billion [129]. - The company is also classified as a "smaller reporting company," which allows for reduced disclosure obligations, including providing only two years of audited financial statements [130]. - The company is required to evaluate its internal control procedures for the fiscal year ending December 31, 2022, as mandated by the Sarbanes-Oxley Act [126].
New Providence Acquisition Corp. II(NPABU) - 2022 Q4 - Annual Report