Workflow
Iron Horse Acquisitions Corp.(IROHU) - 2024 Q3 - Quarterly Report

Part I. Financial Information Financial Statements The blank check company reported net income for Q3 and the first nine months of 2024, primarily from Trust Account interest, with $71.8 million in total assets, a signed business combination agreement, and ongoing going concern uncertainties Balance Sheet Analysis Key Balance Sheet Items (Unaudited) | Financial Metric | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash | $3,084 | $656,977 | | Marketable securities held in Trust Account | $71,697,384 | $69,000,000 | | Total Assets | $71,768,683 | $69,690,134 | | Total Current Liabilities | $1,519,314 | $861,640 | | Total Liabilities | $4,037,814 | $3,380,140 | | Common stock subject to possible redemption | $70,970,693 | $69,000,000 | | Total Stockholders' Deficit | ($3,239,824) | ($2,690,006) | - The increase in assets is primarily due to interest earned on marketable securities held in the Trust Account. The company has a working capital deficit of $1,448,015 as of September 30, 2024833 Statement of Operations Analysis Results of Operations (Unaudited) | Metric | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Interest earned on Trust Account | $915,956 | $0 | $2,705,637 | $0 | | Formation and operational costs | ($290,801) | ($137,134) | ($1,009,065) | ($301,986) | | Provision for income taxes | ($187,760) | $0 | ($576,917) | $0 | | Net Income (Loss) | $465,533 | ($137,134) | $1,420,875 | ($301,986) | - For the nine months ended September 30, 2024, the company also recognized a gain on lawsuit settlements of $295,000 and a gain from the change in fair value of the over-allotment option liability of $11,13512 Business Combination Agreement - On September 27, 2024, the Company entered into a business combination agreement to acquire 100% of Zhong Guo Liang Tou Group Limited (the "Target") from its owner, Rosey Sea Holdings Limited38 - The Target will become a wholly owned subsidiary of the Company. The consideration will be between 40,988,000 and 47,888,000 shares of the Company's common stock, depending on the number of shares redeemed by public stockholders39124 - The transaction is subject to customary closing conditions, including stockholder approval, regulatory approvals, and the effectiveness of an SEC registration statement43 - The agreement can be terminated by either party if the closing has not occurred on or before September 1, 202546 Going Concern and Liquidity - Management has determined that there is substantial doubt about the Company's ability to continue as a going concern due to its current lack of liquidity and the requirement to consummate a Business Combination by December 29, 2024 (or June 29, 2025, if extended)33 - As of September 30, 2024, the Company had only $3,084 in cash outside of the Trust Account and a working capital deficit of $1,448,01533 Management's Discussion and Analysis (MD&A) Management attributes 2024 net income to Trust Account interest, with a primary focus on completing the business combination, while reiterating going concern risks due to limited liquidity and impending merger deadlines MD&A Summary of Financial Results (Unaudited) | Period | Net Income / (Loss) | Key Drivers | | :--- | :--- | :--- | | Q3 2024 | $465,533 | $915,956 interest income offset by $290,801 in operating costs and taxes | | Nine Months 2024 | $1,420,875 | $2.7M interest income and $295k lawsuit gain, offset by $1.0M in operating costs and taxes | | Q3 2023 | ($137,134) | Formation and operating costs | | Nine Months 2023 | ($301,986) | Formation and operating costs | - The company had $71,697,384 held in the Trust Account as of September 30, 2024, which is intended to be used for the business combination133 - A deferred underwriting fee of $2,518,500 is payable from the Trust Account upon the closing of an initial business combination141 Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide disclosures regarding market risk - Disclosure regarding market risk is not required for smaller reporting companies143 Controls and Procedures Management concluded that disclosure controls and procedures were not effective as of September 30, 2024, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of September 30, 2024, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were not effective144 - There were no changes in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls145 Part II. Other Information Summary of Other Information The company reported no legal proceedings or defaults, no material changes to risk factors, and filed the Business Combination Agreement as a primary exhibit - The company reports no legal proceedings147 - There have been no material changes to the risk factors disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2023148 - The Business Combination Agreement with Rosey Sea Holdings Limited was filed as an exhibit to a Form 8-K and is incorporated by reference152