Denali Capital Acquisition (DECA) - 2024 Q1 - Quarterly Report

Financial Performance - The company reported a net income of $264,330 for the three months ended March 31, 2024, compared to a net loss of $1,009,102 for the same period in 2023[14]. - Basic and diluted net income per share for redeemable ordinary shares was $0.10, while for non-redeemable ordinary shares, it was a loss of $0.08[14]. - For the three months ended March 31, 2024, the company reported a net income of $264,330 compared to a net loss of $1,009,102 for the same period in 2023[82]. - The net loss including accretion of temporary equity for the three months ended March 31, 2024, was $(539,555), compared to $(1,921,748) for the same period in 2023[82]. - The income earned on the Trust Account for the three months ended March 31, 2024, was $(653,885), a decrease from $(912,646) in the prior year[82]. - For the three months ended March 31, 2024, the Company reported a net income of $264,330, primarily from investment income of $653,885, offset by operating expenses of $368,252 and interest expense of $21,303[132]. Assets and Liabilities - As of March 31, 2024, total assets amounted to $51,347,261, a slight decrease from $50,687,403 as of December 31, 2023[13]. - Total current liabilities increased to $5,999,507 as of March 31, 2024, from $5,603,980 as of December 31, 2023[13]. - The accumulated deficit increased to $(8,821,852) as of March 31, 2024, from $(8,282,297) as of December 31, 2023[15]. - The company had cash at the end of the period amounting to $1,013, a significant decrease from $204,464 at the beginning of the period[17]. - As of March 31, 2024, the company had marketable securities in the Trust Account amounting to $51,281,849, intended for the business combination[48]. - The company reported a working capital deficit of $5,934,095 as of March 31, 2024, with potential loans from the Sponsor to cover deficiencies[51]. Business Combination and Operations - The company has not commenced any operations and does not expect to generate operating revenues until after completing a business combination[19]. - The company is currently focused on identifying a target company for a business combination, specifically with Longevity Biomedical, Inc.[19]. - The Company entered into a Merger Agreement on January 25, 2023, to combine with Longevity Biomedical, Inc., which includes the acquisition of Cerevast Medical, Inc., Aegeria Soft Tissue LLC, and Novokera LLC[29][31]. - The proposed Longevity Business Combination will result in Holdco becoming a publicly traded company, with its common stock expected to list on Nasdaq under the ticker symbol "LBIO"[31]. - The business combination deadline has been extended from October 11, 2023, to July 11, 2024, with monthly extensions possible[145]. - The Company intends to use substantially all remaining funds in the Trust Account to complete its business combination and for working capital purposes thereafter[139]. Shareholder Actions and Agreements - The shareholders approved the business combination proposal with 5,196,327 votes in favor against 10,100 votes against[44]. - The Voting Stockholder of Longevity has committed to vote in favor of the Merger Agreement, holding sufficient shares to approve the Transactions[32]. - On January 9, 2024, shareholders approved the Longevity Business Combination, with 4,440,202 public shares redeemed for a pro rata portion of the funds in the Trust Account[124]. - The Company will provide Public Shareholders the opportunity to redeem shares for a per-share price based on the Trust Account balance, initially anticipated to be $10.20 per Public Unit[25]. Financing and Loans - The Company issued a Convertible Promissory Note totaling $825,000 to FutureTech, fully utilized for extending the business combination deadline[144]. - The Company issued a convertible promissory note of up to $450,000 to FutureTech to extend the business combination deadline to June 11, 2024[44]. - The Company has the option to convert up to $1.5 million of Working Capital Loans into units of the post-business combination entity at a price of $10.00 per unit[51]. - The outstanding amount under Working Capital Loans was $1,013,200, with accrued interest expense of $29,451 at a rate of 4.86%[101]. - The Company may request an additional aggregate amount of up to $186,800 from the Sponsor, raising the total limit of Working Capital Loans to $1,200,000[101]. Compliance and Regulatory Matters - The Company received a notification from Nasdaq regarding its Minimum Value of Listed Securities (MVLS) being below the required $50 million, with a compliance deadline of August 20, 2024[57]. - The Company intends to actively monitor its MVLS and may evaluate options to resolve the deficiency and regain compliance with Nasdaq listing standards[57]. - There are substantial doubts about the Company's ability to continue as a going concern through July 11, 2024, if a business combination is not consummated[147]. - The Company has incurred significant costs related to being a public company, including legal and financial reporting expenses[131]. Accounting and Financial Reporting - The company has adopted ASU 2020-06 effective January 1, 2024, which simplifies accounting for convertible instruments and does not have a material impact on its financial position[89]. - The company has no unrecognized tax benefits or amounts accrued for interest and penalties as of March 31, 2024[85]. - The Company accounts for its Class A ordinary shares subject to possible redemption as temporary equity due to certain redemption rights being outside of its control[74]. - The fair value of investments held in the Trust Account was $51,281,849 as of March 31, 2024, compared to $50,477,963 as of December 31, 2023[118]. - The net proceeds from the IPO are invested in U.S. government securities, minimizing exposure to interest rate risk[156]. Management and Governance - The report is signed on behalf of Denali Capital Acquisition Corp. by the CEO and CFO, indicating compliance with the Securities Exchange Act of 1934[175]. - The document is dated May 21, 2024, reflecting the timing of the financial disclosures[176]. - The CEO and CFO have authorized the report, ensuring accountability and transparency in financial reporting[177].