IPO and Fundraising - The company completed its IPO on October 25, 2024, raising total gross proceeds of $75 million by selling 7,500,000 units at $10.00 per unit[18]. - A private placement of 240,000 units was also completed, generating additional proceeds of $2.4 million[20]. - The underwriters exercised an over-allotment option on November 19, 2024, purchasing 1,000,000 additional units for gross proceeds of $10 million[22]. - The net proceeds of $75,187,500 from the IPO and private placement were deposited into a trust account for the benefit of public shareholders[83]. - The total cash placed in the trust account following the IPO and private placements was $85,212,500, with an additional $564,299 held outside the trust account for working capital[100]. - The company raised total gross proceeds of $75,000,000 from its initial public offering (IPO) of 7,500,000 units[209]. - The private placement generated total proceeds of $2,400,000 from the sale of 240,000 units at $10.00 per unit[210]. Financial Performance - The company currently has no revenue and has incurred losses since inception, relying on the sale of securities and loans to fund operations[24]. - The company generated a net income of $266,838 from March 22, 2024, to December 31, 2024, primarily from dividends earned on investments held in the trust account totaling $657,624[98]. - For the period from March 22, 2024, through December 31, 2024, the company reported a net income of $266,838[197]. - The total other income for the same period was $858,131, which includes a dividend earned on investments held in the trust account of $657,624[197]. - The company incurred a loss from operations amounting to $591,293[197]. - Basic and diluted income per share for Class A ordinary shares subject to possible redemption was $0.07[197]. - Cash used in operating activities from inception to December 31, 2024, was $171,290, with significant offsets from net income and changes in accounts payable[103]. - The company reported net cash used in operating activities of $(171,290) for the period[203]. Business Combination Plans - The company must complete an initial business combination with a total aggregate fair market value of at least 80% of the assets held in the trust account[25]. - The deadline to consummate the initial business combination is April 25, 2026, with the possibility of two three-month extensions[38]. - The company intends to structure the initial business combination to acquire 100% of the target business, but may acquire less than 100% under certain conditions[26]. - The company has not yet selected a specific initial business combination target but intends to target businesses with enterprise values exceeding the net proceeds from its offering[41]. - To complete the initial business combination, the company may need to seek additional financing if the cash portion of the purchase price exceeds the available amount from the trust account[41]. - The company plans to extend the time to consummate an initial business combination from 18 months to up to 24 months[39]. - If the initial business combination is not completed by the Combination Deadline, the company will redeem 100% of its public shares for a pro rata portion of the funds in the trust account, estimated at $10.025 per public share[42]. - The company is currently in search of a target for its initial business combination, with no specific timeline provided[135]. Shareholder Rights and Governance - A public shareholder can redeem up to 15% of the shares sold in the IPO without prior consent, which is designed to discourage large block accumulations[46]. - The company will require the approval of a majority of shareholders attending the meeting to complete the initial business combination[45]. - The company has agreed not to redeem any public shares held by insiders into their pro rata portion of the trust account[37]. - The company’s insiders beneficially owned approximately 20% of issued and outstanding ordinary shares, allowing them to appoint all directors prior to the initial business combination[159]. - The company has a clawback policy allowing the Compensation Committee to require reimbursement of erroneously awarded compensation in case of accounting restatements[146]. - The company’s insiders have agreed to lock-up provisions restricting the transfer of founder shares for a period of six months post-initial business combination[161]. - The company has established a policy for the approval of related party transactions, requiring audit committee review and approval[174]. Management and Internal Controls - The Company has two executive officers: Will Garner (CEO) and Yuanmei Ma (CFO), who are not obligated to devote specific hours until the initial business combination is completed[59]. - Management identified material weaknesses in internal controls over financial reporting due to inadequate segregation of duties and insufficient written policies[122]. - The company has not adopted any formal cybersecurity risk management program, as it currently does not face significant cybersecurity risks[62]. - The board of directors consists of five members, divided into three classes, with each class serving a three-year term[136]. - The audit committee is chaired by Stephen Markscheid, ensuring compliance with NASDAQ's listing standards and SEC rules[140][141]. - The compensation committee is also composed of independent directors, with Umesh Patel serving as Chairperson[142]. - The company has no significant changes in internal control over financial reporting during the reporting period[125]. - The audit committee is responsible for overseeing the independent registered public accounting firm and ensuring compliance with applicable laws[141]. Assets and Liabilities - The company has total assets of $86,326,908 as of December 31, 2024, which includes $85,870,124 held in a trust account[194]. - Current liabilities amount to $49,634, with accounts payable and accrued expenses at $35,884[194]. - The company has incurred an accumulated deficit of $1,293,097, resulting in a total shareholders' deficit of $1,292,850[194]. - The company had cash at the end of the year amounting to $447,419[203]. - The company received a loan of $273,969 from its sponsor, which was repaid in full on October 25, 2024, from IPO proceeds[169]. - The company has a working capital note provision allowing insiders to loan up to $3,000,000, convertible into working capital units at $10.00 per unit upon business combination[167]. Transaction Costs - The company incurred transaction costs of $3,408,558 related to the IPO, including $1,275,000 in underwriting fees and $1,700,000 in deferred underwriting fees[100]. - The total transaction costs related to the IPO amounted to $3,408,558[214].
Charlton Aria Acquisition Corp-A(CHAR) - 2024 Q4 - Annual Report