IPO and Fundraising - The company completed its Initial Public Offering (IPO) on November 12, 2024, raising gross proceeds of $126.5 million from the sale of 12,650,000 Units at $10.00 per Unit[24]. - A total of $126,879,500 from the IPO and Private Placement was placed in the Trust Account[26]. - The company completed the sale of 5,145,722 Private Placement Warrants at a purchase price of $1.00 per warrant, generating gross proceeds of $5,145,722[200]. - The total amount placed in the Trust Account following the IPO and Private Placement was $126,879,500[215]. - As of December 31, 2025, cash and investments held in the Trust Account amounted to $132,583,821, an increase from $127,163,421 in 2024, including interest income of $5,420,400 and $283,921 respectively[218]. - Cash held outside the Trust Account as of December 31, 2025, was $322,830, down from $1,368,608 in 2024[220]. Business Combination Plans - The company aims to complete its initial Business Combination by November 12, 2026, which is 24 months from the IPO closing date[27]. - The Boost Run Business Combination involves a total consideration of approximately $441.5 million in newly issued shares of Pubco Common Stock and an installment note of $8.5 million[32]. - The Boost Run BCA Amendment extended the Outside Date for the Business Combination to June 30, 2026[31]. - The company and Boost Run will prepare and file a registration statement with the SEC for the securities to be issued in the Boost Run Business Combination[39]. - The Boost Run Business Combination will result in the company and Boost Run becoming wholly owned subsidiaries of Pubco, which will be publicly traded[30]. - The Boost Run Business Combination is subject to customary closing conditions, including shareholder approval and compliance with pre-closing covenants[43]. - The closing conditions also require that no Material Adverse Effect occurs with respect to Boost Run or Pubco since the date of the Boost Run BCA[44]. - The Boost Run BCA includes termination rights if closing conditions are not satisfied by June 30, 2026[46]. - The company has until November 12, 2026, to consummate the Business Combination, or it will cease operations and redeem Public Shares[202]. Financial Performance - For the year ended December 31, 2025, the company reported a net income of $3,438,450, consisting of interest earned on marketable securities of $5,420,400, offset by operating expenses of $2,017,653[213]. - Net cash used in operating activities for the year ended December 31, 2025, was $1,045,778, with net income including interest providing $936,170 of cash from operating activities[216]. Acquisition Strategy - The company seeks to acquire established businesses with valuations below $1 billion and positive EBITDA, focusing on sustainable cash flows[77]. - The acquisition strategy includes targeting businesses in consumer goods, gaming, leisure, and industrial manufacturing sectors[77]. - The company aims to partner with experienced management teams to enhance operational capabilities and achieve long-term excellence[81]. - The acquisition process involves thorough due diligence, including financial, operational, and legal reviews of target businesses[79]. - The company emphasizes the importance of proven unit economics and competitive positioning in evaluating potential acquisition targets[81]. - Target business candidates are sourced from various unaffiliated sources, including investment bankers and private investment funds[95]. - The company may engage finders to identify potential Business Combination opportunities, with fees typically tied to the completion of a transaction[98]. Risks and Challenges - The company is currently dependent on the future performance of a single business, Boost Run, which may expose it to significant risks due to lack of diversification[103]. - The assessment of Boost Run's management team may not be accurate, and future management may lack the necessary skills to manage a public company[104]. - There is uncertainty regarding whether key personnel will remain in senior management or advisory positions after the initial Business Combination[105]. - The company may seek to recruit additional managers post-Business Combination, but there is no assurance that it will be able to find qualified candidates[106]. - The company faces substantial doubt about its ability to continue as a "going concern" due to potential needs for additional financing and the deadline for liquidating its Trust Account[179]. - Increased competition among SPACs for attractive targets may raise costs and hinder the ability to find suitable Business Combination opportunities[165]. - Recent fluctuations in inflation and interest rates could complicate the completion of an initial Business Combination[165]. - The company may face challenges in negotiating Business Combinations due to the requirement to complete within the Combination Period, limiting due diligence time[166]. Shareholder Considerations - Public Shareholders may incur significant dilution due to the conversion of Founder Shares and the exercise of Private Placement Warrants[66][68]. - The redemption price for Public Shares upon completion of the initial Business Combination is approximately $10.48 per share as of December 31, 2025[120]. - Public Shareholders may redeem their shares irrespective of their voting decision on the proposed transaction[128]. - The company requires 4,010,664 Public Shares, or 31.7% of the 12,650,000 Public Shares sold in the Initial Public Offering, to be voted in favor of the initial Business Combination for approval[127]. - If a Special Resolution is required, the company needs 6,890,443 Public Shares, or 54.47% of the 12,650,000 Public Shares, to be voted in favor of the initial Business Combination[127]. - Public Shareholders are restricted from redeeming more than 15% of the Public Shares sold in the Initial Public Offering without prior consent[134]. - The company will not complete the initial Business Combination if the aggregate cash consideration for redemptions exceeds the available cash[133]. Regulatory and Compliance Issues - The company is classified as an "emerging growth company," allowing it to take advantage of certain exemptions from reporting requirements, which may affect investor perception[158]. - The company intends to remain an emerging growth company until it meets specific revenue or market value thresholds, which could impact its reporting obligations[160]. - The company is also a "smaller reporting company," allowing it to provide reduced disclosure obligations until it meets certain market value or revenue criteria[161]. - The company is subject to changing laws and regulations that have increased costs and risks of non-compliance[172]. - Compliance with the Sarbanes-Oxley Act may increase the time and costs associated with completing an initial Business Combination[170]. Miscellaneous - The company has not paid any cash dividends on its Ordinary Shares to date and does not intend to do so prior to the completion of its initial Business Combination[188]. - The company’s Units, Public Shares, and Public Warrants are traded on Nasdaq under the symbols "WLACU", "WLAC", and "WLACW" respectively, with trading commencing on November 8, 2024, and December 30, 2024[186].
Willow Lane Acquisition Corp.(WLAC) - 2025 Q4 - Annual Report