PART I – FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited condensed financial statements for the period ended September 30, 2024, including the balance sheet, statements of operations, changes in stockholders' deficit, and cash flows Condensed Balance Sheets | Metric | Sep 30, 2024 (Unaudited) | Dec 31, 2023 (Audited) | | :--- | :--- | :--- | | Total Assets | $7,540,257 | $57,051,149 | | Cash and marketable securities held in Trust Account | $7,504,714 | $56,981,202 | | Total Liabilities | $13,895,166 | $12,600,595 | | Deferred underwriting payable | $8,750,000 | $8,750,000 | | Total Stockholders' Deficit | ($13,855,449) | ($12,171,136) | - The significant decrease in assets, particularly cash in the Trust Account, is primarily due to substantial redemptions of Class A Common Stock during 20241964 Condensed Statements of Operations | Period | For the Three Months Ended Sep 30 | For the Nine Months Ended Sep 30 | | :--- | :--- | :--- | | 2024 | | | | Interest Income | $84,888 | $1,197,306 | | Net Loss | ($292,612) | ($356,389) | | 2023 | | | | Interest Income | $722,208 | $5,138,865 | | Net Income | $225,699 | $2,945,394 | - The company shifted from a net income position in 2023 to a net loss in 2024, primarily driven by a significant reduction in interest earned on the Trust Account following large-scale shareholder redemptions23 Condensed Statements of Changes in Stockholders' Deficit - The total stockholders' deficit increased from ($12,171,136) at the beginning of 2024 to ($13,855,449) as of September 30, 2024. This change was driven by the net loss for the period and remeasurements of Class A Common Stock to its redemption value25 - During the nine months ended September 30, 2024, an aggregate of 3,249,999 shares of Class B Common Stock were converted into an equal number of Class A Common Stock2568 Condensed Statements of Cash Flows | Cash Flow Activity (Nine Months Ended Sep 30, 2024) | Amount | | :--- | :--- | | Net cash used in operating activities | ($1,277,682) | | Net cash provided by investing activities | $50,673,794 | | Net cash used in financing activities | ($49,449,579) | - Cash flows from investing and financing activities were dominated by the withdrawal of $49.95 million from the Trust Account to fund the redemption of Common Stock31 Notes to Condensed Financial Statements (Unaudited) - On November 8, 2024, the company's board decided to dissolve and liquidate, abandoning plans to extend its business combination deadline. The redemption of public shares occurred on November 26, 20243465 - Management has determined there is substantial doubt about the Company's ability to continue as a going concern due to its lack of liquidity and impending dissolution74 - The company recorded an aggregate 1% Excise Tax liability of $2,554,283 as of September 30, 2024, related to shareholder redemptions that occurred in 2023 and 202477 - As of September 30, 2024, the company had $790,000 outstanding under promissory notes from its Sponsor to fund operations140 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's history as a blank check company, its financial performance, and its liquidity position Results of Operations - The company has not engaged in any operations or generated any revenues to date. Its activities have been limited to organizational tasks, preparing for the IPO, and identifying a target for a Business Combination200 | Period | Net (Loss) / Income | Key Drivers | | :--- | :--- | :--- | | Q3 2024 | ($292,612) | Operating costs of $368,515 offset by interest income of $84,888 | | Q3 2023 | $225,699 | Interest income of $722,208 offset by operating costs of $355,345 | | Nine Months 2024 | ($356,389) | Operating costs of $1,330,422 offset by interest income of $1,197,306 | | Nine Months 2023 | $2,945,394 | Interest income of $5,138,865 offset by operating costs of $1,145,809 | Liquidity, Capital Resources and Going Concern - As of September 30, 2024, the company had only $3,400 in cash held outside the Trust Account for operational needs, with $7.5 million remaining in the Trust Account210212 - The company has relied on promissory notes from its Sponsor for working capital. As of September 30, 2024, $790,000 was outstanding, and the notes were subsequently fully drawn down in October 2024215216 - Management has concluded that the company's lack of liquidity and impending dissolution and liquidation raise substantial doubt about its ability to continue as a going concern219 Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, New Providence Acquisition Corp. II is not required to provide the information for this item - The company is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information otherwise required under this Item232 Controls and Procedures Management's evaluation concluded that the company's disclosure controls and procedures were not effective as of September 30, 2024 - Management concluded that disclosure controls and procedures were not effective as of September 30, 2024236 - The ineffectiveness is attributed to material weaknesses related to (i) properly recording and accruing expenses and (ii) safeguarding Trust Account assets and monitoring the use of its funds236 - Remediation efforts include enhancing processes and making greater use of third-party professionals to consult on complex accounting applications237 PART II – OTHER INFORMATION Legal Proceedings The company reports that there is no material litigation currently pending or contemplated against it, its officers, or its directors - To the knowledge of management, there is no material litigation currently pending or contemplated against the company242 Risk Factors This section highlights significant risks, primarily the impending suspension and potential delisting of the company's securities from Nasdaq for failing to complete a business combination by the November 4, 2024 deadline - The company faces suspension and potential delisting from Nasdaq because it failed to consummate its initial Business Combination by the 36-month deadline of November 4, 2024244245 - Significant shareholder redemptions in 2023 and 2024 have reduced the Trust Account balance to approximately $7.5 million, which limits the company's ability to complete an optimal business combination251253254 Unregistered Sales of Equity Securities and Use of Proceeds The company reports no unregistered sales of securities during the quarter but discloses the July 2024 conversion of 3,249,999 Class B shares into Class A shares - On July 29, 2024, the company issued 3,249,999 shares of Class A Common Stock upon the conversion of an equal number of Class B shares held by Founder Share Holders in an unregistered transaction255 - In April 2024, the company liquidated the investments held in its Trust Account and moved the funds into an interest-bearing demand deposit account to mitigate risks of being viewed as an unregistered investment company258 Defaults Upon Senior Securities The company reports no defaults upon senior securities - None262 Mine Safety Disclosures This item is not applicable to the company - Not applicable264 Other Information This section confirms that no directors or officers engaged in Rule 10b5-1 trading arrangements during the quarter - The Second Promissory Note was amended to increase the available principal from $400,000 to $900,000. The full amount was drawn by October 16, 2024268 - No directors or officers adopted or terminated any Rule 10b5-1 trading arrangements during the third quarter of 2024266 Exhibits This section lists the exhibits filed as part of the Form 10-Q, which include certifications from the principal executive and financial officer as required by the Sarbanes-Oxley Act of 2002 - The report includes officer certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002271 - Inline XBRL Instance, Schema, Calculation, Definition, Label, and Presentation documents are filed with this report271
New Providence Acquisition Corp. II(NPABU) - 2024 Q3 - Quarterly Report