IPO and Financing - The Company completed its IPO on January 23, 2024, raising gross proceeds of $57,500,000 from the sale of 5,750,000 units at $10.00 per unit[17]. - A private placement of 240,000 units was also completed simultaneously, generating total proceeds of $2,400,000[18]. - A total of $57,500,000 from the IPO and private placement was deposited into a trust account for public shareholders[19]. - The company raised approximately $57,500,000 from the IPO and $2,400,000 from the Private Placement Units, resulting in net cash provided by financing activities of $59,037,309 for the year ended December 31, 2024[121]. - The company deposited $575,000 into its trust account to extend the combination period from January 23, 2025, to April 23, 2025[70]. - The company can extend the time available to consummate a Business Combination by depositing $575,000 into the Trust Account[111]. Merger Agreement - The Company entered into a Merger Agreement on April 8, 2024, with an aggregate consideration of $2,300,000,000 to be paid entirely in stock at a price of $10.00 per share[20]. - The First Amendment to the Merger Agreement was executed on September 3, 2024, modifying the share exchange terms and increasing the termination fee to $2,000,000[23]. - At the Company Amalgamation Effective Time, 195,500,000 PubCo Ordinary Shares will be issued in exchange for Hotel101 Global Shares[23]. - The company has not generated any operating revenues to date and does not expect to do so until after the completion of its initial business combination[113]. Trust Account and Shareholder Returns - If the initial business combination is not completed, public shareholders will receive approximately $10.00 per share upon liquidation[35]. - The trust account funds may be subject to claims from creditors, potentially affecting the redemption amounts for public shareholders[34]. - The company has a trust account with a minimum threshold of $10.00 per share, and any claims that reduce the trust account below this amount may affect shareholder returns[41]. - If the company is deemed insolvent, funds in the trust account may be subject to claims from third parties, potentially limiting returns to public shareholders[40]. Regulatory and Legal Risks - The company faces significant legal and operational risks when considering business combinations with PRC companies, including regulatory reviews and restrictions on foreign ownership[43]. - Recent regulatory changes in China, such as the Trial Administrative Measures for Overseas Securities Offering, impose additional requirements for PRC companies seeking to list abroad[46]. - The company is subject to uncertainties in the PRC legal system, which could limit the enforcement of contractual arrangements with VIEs[47]. - The company may need to navigate complex regulations regarding fund transfers and dividends between its subsidiaries and the holding company[48]. - The PCAOB's ability to conduct inspections may be hindered if PRC authorities obstruct access, potentially leading to delisting of securities from U.S. exchanges[52]. - The company is subject to U.S. foreign investment regulations which may limit its ability to complete an initial business combination with a U.S. target company[85]. Financial Performance and Position - For the year ended December 31, 2024, the company reported a net income of $2,002,561, compared to a net loss of $76,827 for the year ended December 31, 2023[115][120]. - The company had net cash used in operating activities of $728,008 for the year ended December 31, 2024, with changes in operating assets and liabilities providing $39,607 of cash[120]. - As of December 31, 2024, the company had cash of $809,301 and working capital of $415,647[84]. - As of December 31, 2024, the company had investments held in the Trust Account totaling $60,270,176, including approximately $2,770,176 of interest income[122]. - The company has incurred significant costs to remain publicly traded and may need to raise additional capital to meet operational expenditures prior to the initial Business Combination[127]. - If a Business Combination is not consummated by April 23, 2025, the company faces mandatory liquidation and dissolution, raising substantial doubt about its ability to continue as a going concern[129]. Corporate Governance - The Board of Directors consists of five members, with directors serving a four-year term[163]. - The company has established three standing committees: an audit committee, a compensation committee, and a nominating committee, all of which are composed solely of independent directors[166]. - The audit committee is responsible for overseeing the work of independent auditors and ensuring their independence, with Mr. Frank Clifford Chan serving as the chairperson[167][168]. - The compensation committee has the authority to retain compensation consultants and is responsible for approving executive compensation policies and plans[169]. - The nominating committee is tasked with selecting nominees for the Board of Directors and ensuring a diverse mix of skills and backgrounds among its members[170][171]. Conflicts of Interest - The company has a fiduciary duty to act in the best interests of shareholders and to avoid conflicts of interest, as outlined in its amended and restated memorandum and articles of association[172][174]. - Directors and officers are not required to commit full time to the company's affairs, which may lead to conflicts of interest in managing their time across various business activities[176][177]. - The company may pursue initial business combinations with entities affiliated with its sponsor, officers, or directors, provided that an independent opinion is obtained to ensure fairness[179]. - The sponsor may make loans to the company, which could be converted into units if a business combination is completed, creating potential conflicts of interest[181]. Shareholder Information - Winky Investments Limited holds 1,677,500 ordinary shares, representing 21.8% of the total outstanding shares[198]. - The total number of ordinary shares issued and outstanding as of March 6, 2025, is 7,686,250[196]. - Harraden Circle Investments, LLC owns 479,656 ordinary shares, accounting for 6.24% of the total[198]. - Meteora Capital, LLC holds 593,097 ordinary shares, which is 7.72% of the total[198]. - Mizuho Financial Group, Inc. has 562,054 ordinary shares, representing 7.31% of the total[198]. - First Trust Capital Management L.P. owns 630,200 ordinary shares, accounting for 8.20% of the total[198]. Compliance and Internal Controls - The Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2024[146]. - Management assessed the effectiveness of internal control over financial reporting as of December 31, 2024, and determined that it was effective based on COSO criteria[150]. - The company does not expect its disclosure controls and procedures to prevent all errors and instances of fraud, acknowledging inherent limitations[147]. - The management is responsible for establishing and maintaining adequate internal control over financial reporting in accordance with GAAP[149]. Policies and Procedures - The company has adopted a Clawback Policy to recoup incentive compensation based on erroneous data[195]. - The company has adopted insider trading policies to promote compliance with applicable laws and regulations[185]. - The company has adopted a code of ethics to avoid conflicts of interest, requiring board approval for any related transactions[213]. - Related party transactions will require a majority vote from the audit committee for approval, ensuring independence and conflict of interest assessments[214]. - The company will not consummate a business combination with an entity affiliated with the sponsor or directors without an independent fairness opinion[216].
JVSPAC Acquisition Corp.(JVSAU) - 2024 Q4 - Annual Report