Keen Vision Acquisition (KVAC) - 2025 Q2 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1. Financial Statements This section presents the unaudited condensed consolidated financial statements, including the balance sheets, statements of income and comprehensive income, statements of changes in shareholders' deficit, and statements of cash flows, along with their accompanying notes, providing a snapshot of the company's financial position, performance, and cash movements for the periods ended June 30, 2025, and December 31, 2024 Condensed Consolidated Balance Sheets | ASSETS | June 30, 2025 (unaudited) | December 31, 2024 | | :---------------------------------- | :------------------------ | :------------------------ | | Cash at bank | $1,317 | $54,548 | | Prepayment | $63,815 | $9,238 | | Total current assets | $65,132 | $63,786 | | Cash and investments held in Trust Account | $73,062,664 | $70,373,065 | | TOTAL ASSETS | $73,127,796 | $70,436,851 | | LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS' DEFICIT | | | | Accrued expenses | $28,910 | $97,813 | | Extension promissory note payable | $1,800,000 | $600,000 | | Amount due to a related party | $1,008,707 | $575,085 | | Total current liabilities | $2,837,617 | $1,272,898 | | Deferred underwriting compensation | $2,990,000 | $2,990,000 | | TOTAL LIABILITIES | $5,827,617 | $4,262,898 | | Ordinary shares subject to possible redemption | $73,062,663 | $70,373,065 | | Accumulated deficit | $(5,762,926) | $(4,199,554) | | Total Shareholders' Deficit | $(5,762,484) | $(4,199,112) | | TOTAL LIABILITIES, TEMPORARY EQUITY AND SHAREHOLDERS' DEFICIT | $73,127,796 | $70,436,851 | Unaudited Condensed Consolidated Statements of Income and Comprehensive Income | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Formation and operating costs | $(192,040) | $(267,344) | $(363,373) | $(533,783) | | Dividend income earned in Trust Account | $750,095 | $2,041,871 | $1,489,599 | $3,530,524 | | Interest income earned in Trust Account | $- | $- | $- | $2,043,965 | | Total other income | $750,095 | $2,041,879 | $1,489,599 | $5,574,511 | | NET INCOME | $558,055 | $1,774,535 | $1,126,226 | $5,040,728 | | COMPREHENSIVE INCOME | $558,055 | $1,774,535 | $1,126,226 | $3,519,557 | | Basic and diluted net income per share (redeemable) | $0.10 | $0.12 | $0.20 | $0.35 | | Basic and diluted net loss per share (non-redeemable) | $(0.02) | $(0.01) | $(0.03) | $(0.03) | Unaudited Condensed Consolidated Statements of Changes in Shareholders' Deficit | Item | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------------- | :------------------------------------- | | Balance as of January 1 | $(4,199,112) | $(2,138,385) | | Accretion of carrying value to redemption value | $(2,689,598) | $(4,053,317) | | Net income | $1,126,226 | $5,040,728 | | Transfer to realized loss on available held for sale securities | $- | $(1,521,171) | | Balance as of June 30 | $(5,762,484) | $(2,672,145) | Unaudited Condensed Consolidated Statements of Cash Flows | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Net income | $1,126,226 | $5,040,728 | | Net cash used in operating activities | $(486,853) | $(370,399) | | Net cash used in investing activities | $(1,200,000) | $- | | Net cash provided by financing activities | $1,633,622 | $- | | NET CHANGE IN CASH | $(53,231) | $(370,399) | | CASH AT BANK, END OF PERIOD | $1,317 | $261,354 | Notes to Unaudited Condensed Consolidated Financial Statements NOTE 1 - ORGANIZATION AND BUSINESS BACKGROUND - Keen Vision Acquisition Corporation is a blank check company (SPAC) incorporated on June 18, 2021, for the purpose of effecting a Business Combination, and has not commenced any operations as of June 30, 2025, generating non-operating income from its Trust Account[15][17][100] | IPO and Private Placement Details | Amount | | :-------------------------------- | :------------- | | Public Units Sold (July 27, 2023) | 14,950,000 | | Gross Proceeds from Public Units | $149,500,000 | | Private Placement Units Sold (July 27, 2023) | 678,575 | | Gross Proceeds from Private Placement | $6,785,750 | | Total Transaction Costs | $6,597,980 | | Initial Trust Account Deposit | $151,368,750 | - On September 3, 2024, the Company entered into a merger agreement with Medera Inc., a clinical-stage biopharmaceutical company, for a proposed business combination, with the transaction valuing 100% of Medera's shares at $622,560,000[30][31][105][106] - The Company has extended its business combination period multiple times, with the current deadline being August 27, 2025, and as of July 23, 2025, $144,670 was deposited to extend until August 27, 2025[35][38][95] - As of June 30, 2025, the Company reported a working capital deficit of $2,772,485, raising substantial doubt about its ability to continue as a going concern if a Business Combination is not consummated by August 27, 2025 (unless further extended)[38][39] NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES - The Company is an "emerging growth company" and has elected not to opt out of the extended transition period for complying with new or revised financial accounting standards, which may affect comparability with other public companies[43][44] - Warrants issued in the Initial Public Offering and private placements are classified as equity, as they meet the criteria for equity classification under ASC 480[50][125] - Ordinary shares subject to possible redemption are classified as temporary equity due to redemption rights that are subject to uncertain future events and considered outside the Company's control[51][122] | Description | June 30, 2025 (Level 1) | December 31, 2024 (Level 1) | | :---------------------------------- | :------------------------ | :------------------------ | | U.S. Treasury Securities held in Trust Account | $73,062,664 | $70,373,065 | - The Company is considered an exempted British Virgin Islands company and is not subject to income taxes or filing requirements in the British Virgin Islands, reporting no unrecognized tax benefits or accrued interest/penalties[60][62] NOTE 3 – INITIAL PUBLIC OFFERING - On July 27, 2023, the Company sold 14,950,000 Public Units at $10.00 per unit in its Initial Public Offering[69] - Public shares with redemption features are classified as temporary equity, and changes in their redemption value are recognized immediately as deemed dividends[70][71] NOTE 4 – PRIVATE PLACEMENT - Simultaneously with the IPO, 678,575 Private Placement Units were sold to the Sponsor at $10.00 per unit, generating $6,785,750[72] - Private Placement Units are identical to Public Units, except for certain registration rights and transfer restrictions[73] NOTE 5 – RELATED PARTY TRANSACTIONS - The Company issued 3,737,500 Founder Shares to initial shareholders, with no shares subject to forfeiture after the underwriter's over-allotment option was fully exercised[74] - An affiliate of the Sponsor provides administrative services for $10,000 per month, with unpaid fees of $60,000 as of June 30, 2025[75] - The Sponsor has provided unsecured, non-interest bearing promissory notes totaling $1,800,000 as of June 30, 2025, to fund Trust Account extensions for the business combination period[77] - As of June 30, 2025, the Company had an unsecured, interest-free advance of $1,008,707 from the Sponsor with no fixed repayment terms[78] NOTE 6 – SHAREHOLDERS' DEFICIT - The Company is authorized to issue 500,000,000 ordinary shares at $0.0001 par value, with 4,416,075 ordinary shares issued and outstanding as of June 30, 2025, excluding 6,404,652 shares subject to possible redemption[79][80] - Warrants entitle holders to purchase one ordinary share at an exercise price of $11.50, exercisable after a Business Combination, contingent on an effective registration statement[81] - The Company may redeem public warrants at $0.01 per warrant if the ordinary share price equals or exceeds $16.50 for 20 trading days within a 30-day period, provided a current registration statement is in effect[82][83] NOTE 7 – COMMITMENTS AND CONTINGENCIES - Management is evaluating the potential negative impact of geopolitical conflicts (Russia-Ukraine war, Israel-Palestine conflict) on the Company's financial position and search for a target company, though the specific impact is not yet determinable[86] - Holders of Founder Shares, Private Placement Units, and certain other units are entitled to registration rights, allowing them to demand the Company register their securities for resale[87][119] - Underwriters are entitled to a deferred underwriting commission of $2,990,000, payable upon the closing of a Business Combination[88][120] NOTE 8 – SEGMENT INFORMATION - The Company operates as a single operating segment, with the Chief Financial Officer identified as the chief operating decision maker (CODM)[90] - The CODM reviews earned income on Trust Account investments and formation/operating costs to manage resources and assess financial performance[92] NOTE 9 – SUBSEQUENT EVENTS - On July 22, 2025, the Trust Agreement was amended to extend the business combination period from July 27, 2025, to January 27, 2026, requiring an extension payment of $0.03 for each remaining public share[94] - On July 23, 2025, the Company deposited an additional $144,670 into the Trust Account to extend the business combination deadline until August 27, 2025[95] - On July 22, 2025, 1,582,306 shares were redeemed by shareholders at approximately $11.41 per share, totaling $18,052,529[96] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the Company's financial condition and results of operations, reiterating its status as a blank check company, detailing the IPO and private placement, discussing the ongoing efforts to complete a business combination with Medera Inc., highlighting net income, and addressing liquidity concerns related to the business combination deadline - The Company is a blank check company formed to effect a business combination, which consummated its IPO on July 27, 2023, selling 14,950,000 units for $149,500,000, and a private placement of 678,575 units for $6,785,750[100][101][102] - On September 3, 2024, the Company entered into a merger agreement with Medera Inc., a clinical-stage biopharmaceutical company, for a proposed business combination[105] | Period | Net Income | | :----------------------------- | :----------- | | Six months ended June 30, 2025 | $1,126,226 | | Six months ended June 30, 2024 | $5,040,728 | | Three months ended June 30, 2025 | $558,055 | | Three months ended June 30, 2024 | $1,774,535 | - The Company faces substantial doubt about its ability to continue as a going concern if a Business Combination is not consummated by August 27, 2025 (unless further extended), due to a working capital deficit and reliance on additional financing[116] Item 3. Quantitative and Qualitative Disclosures about Market Risk As a smaller reporting company, Keen Vision Acquisition Corporation is not required to provide specific disclosures regarding quantitative and qualitative market risk - The Company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[127][133] Item 4. Control and Procedures Management, including the CEO and CFO, evaluated the effectiveness of the Company's disclosure controls and procedures as of June 30, 2025, concluding they were effective, with no material changes in internal control over financial reporting during the quarter - Management concluded that the Company's disclosure controls and procedures were effective as of June 30, 2025[129] - There were no material changes in the Company's internal control over financial reporting during the quarter ended June 30, 2025[130] PART II – OTHER INFORMATION Item 1. Legal Proceedings The Company reported no legal proceedings during the period - The Company has no legal proceedings to report[132] Item 1A. Risk Factors As a smaller reporting company, the Company is not required to make disclosures under this item - As a smaller reporting company, the Company is not required to make disclosures under the Risk Factors item[133] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section details the Initial Public Offering and private placement of units, including the gross proceeds generated and the deposit of net proceeds into the Trust Account, clarifying that the private units are identical to public units except for certain restrictions - The IPO on July 27, 2023, involved the sale of 14,950,000 units at $10.00 per unit, generating gross proceeds of $149,500,000[134] - A private placement of 678,575 Private Units to the Sponsor generated gross proceeds of $6,785,750[136] - A total of $151,368,750 from the IPO and private placement was deposited into a trust account for the benefit of public stockholders[137] Item 3. Defaults Upon Senior Securities The Company reported no defaults upon senior securities - The Company has no defaults upon senior securities[139] Item 4. Mine Safety Disclosures This item is not applicable to the Company - Mine Safety Disclosures are not applicable to the Company[140] Item 5. Other Information The Company reported no other information under this item - The Company has no other information to report under this item[141] Item 6. Exhibits This section lists the exhibits filed as part of, or incorporated by reference into, the Quarterly Report, including the Merger Agreement, various certifications, and XBRL documents - Key exhibits include the Merger Agreement dated September 3, 2024, a joinder agreement, and certifications from the Principal Executive Officer and Principal Financial Officer (Sections 302 and 906 of Sarbanes-Oxley Act)[143] SIGNATURES Signatures The report was duly signed on behalf of Keen Vision Acquisition Corporation by its Chief Executive Officer, Kenneth K.C. Wong, and Chief Financial Officer, Alex Davidkhanian, on August 11, 2025 - The report was signed by Kenneth K.C. Wong, Chief Executive Officer, and Alex Davidkhanian, Chief Financial Officer, on August 11, 2025[148][149][150]