Newbury Street II Acquisition Corp(NTWOU) - 2025 Q4 - Annual Report

IPO and Fundraising - The company completed its Initial Public Offering (IPO) on November 4, 2024, raising gross proceeds of $172,500,000 from the sale of 17,250,000 Public Units at $10.00 each[21]. - An additional $6,483,750 was generated from the private sale of 648,375 Private Placement Units, bringing total funds to approximately $173,362,500 placed in the Trust Account[22][23]. - Following the IPO and Private Placement, $173.36 million was placed in a Trust Account, which can only be invested in U.S. government securities or held as cash until the completion of a Business Combination[156]. - The total amount placed in the Trust Account after the Initial Public Offering was $173,362,500, with fees incurred amounting to $10,113,129[162]. Business Combination Requirements - The company must complete its initial Business Combination by November 4, 2026, or face termination and distribution of Trust Account funds[24]. - The initial Business Combination must involve a target business with an aggregate fair market value of at least 80% of the assets held in the Trust Account[56]. - The company intends to structure its initial Business Combination so that the post-transaction entity will own or acquire 100% of the equity interests or assets of the target business[57]. - The company may seek additional financing through private offerings of debt or equity securities to complete its initial Business Combination[50]. - If the initial Business Combination is funded with assets other than those in the Trust Account, the company will disclose the financing terms in its tender offer documents[52]. Management and Strategy - The management team has extensive experience in identifying and acquiring businesses, which is expected to facilitate the search for suitable Business Combination targets[28][34]. - The company aims to acquire businesses with strong competitive positions, growth potential, and the ability to scale internationally[36]. - The management team is focused on companies that have revenue and earnings growth potential, with multiple drivers for such growth[42]. - The company has established criteria for evaluating potential acquisition targets, including access to public equity markets and a talented management team[36]. Shareholder Rights and Redemption - A minimum of 5,191,813 Public Shares, or 30.01% of the 17,250,000 Public Shares sold in the Initial Public Offering, must be voted in favor of the initial Business Combination for approval[86]. - Shareholder approval is required if the transaction involves issuing more than 20% of the outstanding Ordinary Shares or amending the Amended and Restated Articles[81]. - The redemption rights allow Public Shareholders to redeem their shares at the per-share price based on the amount in the Trust Account, calculated two business days prior to the Business Combination[79]. - Public Shareholders are restricted from redeeming more than 15% of the Public Shares sold in the Initial Public Offering without prior consent, which aims to prevent a small group from blocking the initial Business Combination[91]. - The Company will provide Public Shareholders with the opportunity to redeem their shares regardless of their voting decision on the initial Business Combination[81]. Financial Performance and Risks - For the year ended December 31, 2025, the company reported a net income of $6,620,992, primarily from interest earned on marketable securities held in the Trust Account[160]. - As of December 31, 2025, the company had marketable securities in the Trust Account totaling $181,847,374, including approximately $8,484,874 of interest income[163]. - The company has a liquidity concern, lacking sufficient funds to sustain operations for at least one year from the issuance date of the financial statements[170]. - The company may face risks related to its search for a Business Combination, including the potential inability to complete the initial Business Combination within the Combination Period, which could lead to liquidation[122]. - There is substantial doubt about the company's ability to continue as a "going concern," which may affect investor confidence[125]. Corporate Governance and Compliance - The company is required to file annual, quarterly, and current reports with the SEC, ensuring transparency and compliance with the Exchange Act[111]. - The company is classified as an "emerging growth company," allowing it to take advantage of certain exemptions from reporting requirements, which may affect the attractiveness of its securities to investors[116]. - The company has a diverse board with significant experience in media, finance, and technology sectors, including members with backgrounds from Sony Pictures, Uber, and Blackrock[196][197][199][200][201][202]. - The Audit Committee consists of independent directors Josh Gold, Jennifer Vescio, and Ted Seides, with Josh Gold serving as chairman[208]. - The company has adopted a Code of Ethics, with amendments or waivers disclosed on its website[216]. Operational Challenges - The company is facing intense competition from established entities, including private investors and other blank check companies, which may limit its ability to acquire sizable target businesses due to relatively limited financial resources[109]. - The company may encounter challenges in negotiating Business Combinations due to increased competition for attractive targets and potential negative perceptions of SPAC mergers[122]. - The company has not generated any operating revenues to date and will not do so until after completing its initial Business Combination[159]. - The company may seek Business Combination opportunities in industries outside of its Management's areas of expertise, which could impact the evaluation of target businesses[125]. Internal Controls and Audit - Management determined that the internal control over financial reporting was effective as of December 31, 2025, based on COSO criteria[188]. - The company’s internal controls are designed to provide reasonable assurance regarding the reliability of financial reporting in accordance with GAAP[187]. - The company emphasizes that while controls are effective, they cannot prevent all errors or instances of fraud due to inherent limitations[186]. - The company assessed the effectiveness of its disclosure controls and procedures, concluding they were effective as of December 31, 2025[185].