UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
For
the quarterly period ended
For the transition period from ______________ to ______________
Commission
File Number
(Exact name of registrant as specified in its charter)
| N/A | ||
(State or other jurisdiction of incorporation or organization) |
(IRS Employer Identification No.) |
(Address of principal executive offices and zip code)
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbols | Name of Each Exchange on Which Registered | ||
| The Stock Market LLC | ||||
| The Stock Market LLC | ||||
| The Stock Market LLC |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was
required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
| Large accelerated filer ☐ | Accelerated filer ☐ |
| Smaller
reporting company | |
| Emerging
growth company |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of November 14, 2024, there were ordinary shares, par value $ issued and outstanding.
BAYVIEW ACQUISITION CORP
TABLE OF CONTENTS
| 2 |
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
BAYVIEW ACQUISITION CORP
BALANCE SHEETS
September 30, 2024 | December 31, 2023 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Total current assets | ||||||||
| Prepaid expenses – non-current | ||||||||
| Investment held in trust account | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accrued offering costs and expenses | $ | $ | ||||||
| Promissory note - extension | ||||||||
| Due to related party | ||||||||
| Total Current Liabilities | ||||||||
| Deferred underwriting commission payable | ||||||||
| Total Liabilities | ||||||||
| Commitments and contingencies | ||||||||
| Ordinary shares subject to possible redemption ( and shares at redemption value of $ and $ as of September 30, 2024 and December 31, 2023, respectively) | ||||||||
| Shareholders’ Deficit: | ||||||||
| Preferred shares, $ par value; shares authorized; issued and outstanding | ||||||||
| Ordinary shares, $ par value; shares authorized; and shares issued and outstanding (excluding and shares subject to possible redemption) at September 30, 2024 and December 31, 2023, respectively | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Shareholders’ Deficit | ( | ) | ( | ) | ||||
| Total Liabilities and Shareholders’ Deficit | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited financial statement.
| 3 |
BAYVIEW ACQUISITION CORP
STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Three Months Ended September 30, 2024 | For The Three Months Ended September 30, 2023 | For The Nine Months Ended September 30, 2024 | For the Period from February 16, 2023 (inception) Through September 30, 2023 | |||||||||||||
| Formation and operating costs | $ | $ | $ | $ | ||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other Income: | ||||||||||||||||
| Interest and dividend earned on securities held in trust account | ||||||||||||||||
| Total other income | ||||||||||||||||
| Net Income (Loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Basic and diluted weighted average ordinary shares outstanding, redeemable ordinary shares | ||||||||||||||||
| Basic and diluted net income per shares, redeemable shares | $ | $ | $ | $ | ||||||||||||
| Basic and diluted weighted average ordinary shares outstanding, redeemable ordinary shares | (1) | (1) | ||||||||||||||
| Basic and diluted net loss per shares, non-redeemable shares | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| (1) |
The accompanying notes are an integral part of these unaudited financial statement.
| 4 |
BAYVIEW ACQUISITION CORP
STATEMENT OF CHANGES IN SHAREHOLDERS’ DEFICIT
(UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024
| Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balance as of January 1, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Forfeiture of ordinary shares by Sponsors | ( | ) | ( | ) | ||||||||||||||||
| Subsequent measurement of ordinary shares subject to possible redemption (interest earned on trust account) | - | ( | ) | ( | ) | ( | ) | |||||||||||||
| Net income | - | |||||||||||||||||||
| Balance as of March 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Subsequent measurement of ordinary shares subject to possible redemption (interest earned on trust account) | - | ( | ) | ( | ) | |||||||||||||||
| Net income | - | |||||||||||||||||||
| Balance as of June 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Subsequent measurement of ordinary shares subject to possible redemption (interest earned on trust account) | - | ( | ) | ( | ) | |||||||||||||||
| Subsequent measurement of ordinary shares subject to possible redemption (extension deposit) | - | ( | ) | ( | ) | |||||||||||||||
| Net income | - | |||||||||||||||||||
Balance as of September 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
FOR THE PERIOD FROM FEBRUARY 16, 2023 (INCEPTION) THROUGH SEPTEMBER 30, 2023
| Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ | |||||||||||||||||
| Shares (1) | Amount | Capital | Deficit | Equity | ||||||||||||||||
| Balance as of February 16, 2023 | $ | $ | $ | $ | ||||||||||||||||
| Issuance of ordinary shares to Sponsors | ||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balance as of March 31, 2023 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net loss | - | |||||||||||||||||||
| Balance as of June 30, 2023 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balance as of September 30, 2023 | ( | ) | ||||||||||||||||||
| (1) |
The accompanying notes are an integral part of these unaudited financial statement.
| 5 |
BAYVIEW ACQUISITION CORP
STATEMENT OF CASH FLOWS
(UNAUDITED)
For the Nine Months Ended September 30, 2024 | For the Period from February 16, 2023 (inception) through September 30, 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income (loss) | $ | ( | ) | |||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Income earned on investments held in Trust Account | ( | ) | ||||||
| Accrued offering costs and expenses | ||||||||
| Prepaid expenses | ||||||||
| Due to related party | ||||||||
| Formation and operating costs | ||||||||
| Net cash used in operating activities | ( | ) | ||||||
| Cash flows from investing activities: | ||||||||
| Cash withdrawn from trust account in connection with redemption | ||||||||
| Principal deposited into trust account in connection with extension | ( | ) | ||||||
| Net cash used in investing activities | ||||||||
| Cash flows from financing activities: | ||||||||
| Redemption of ordinary shares | ( | ) | ||||||
| Proceeds from promissory note | ||||||||
| Net cash used in financing activities | ( | ) | ||||||
| Net change in cash | ( | ) | ||||||
| Cash at beginning of period | ||||||||
| Cash at end of period | $ | |||||||
| Supplemental disclosure of noncash investing and financing activities | ||||||||
| Subsequent measurement of ordinary shares subject to possible redemption (income earned on trust account) | ||||||||
| Deferred offering costs paid by Sponsors in exchange for issuance of ordinary shares | ||||||||
| Deferred offering costs paid by related party | ||||||||
| Deferred offering costs included in accrued expenses | ||||||||
| Prepaid expenses included in due to related party | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited financial statement.
| 6 |
BAYVIEW ACQUISITION CORP
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2024
(UNAUDITED)
NOTE 1 —ORGANIZATION AND BUSINESS OPERATIONS
Organizational and General
Bayview Acquisition Corp (the “Company”) was incorporated in the Cayman Islands on February 16, 2023. The Company was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses or entities (the “Business Combination”).
The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination. The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.
The Company’s sponsors are Peace Investment Holdings Limited, a British Virgin Islands company, and Bayview Holding LP, a Delaware limited partnership (the “Sponsors”). As of September 30, 2024, the Company had not commenced any operations. All activities for the period from February 16, 2023 (inception) through September 30, 2024 related to the Company’s formation and the initial public offering (“IPO”), and subsequent to the IPO, identifying a target company for an initial Business Combination. The Company will not generate any operating revenues until after the completion of an initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest or dividend income from the proceeds derived from the IPO. The Company has selected December 31 as its fiscal year end.
The
registration statement for the Company’s IPO (the “Registration Statement”) was declared effective on December 14,
2023. Additionally, on December 14, 2023, the Company filed a registration statement adding securities to the Registration Statement.
On December 19, 2023, the Company consummated the IPO of units, (“Units” and, with respect to the ordinary shares
included in the Units being offered, the “Public Shares”) at $ per Unit, generating gross proceeds of $
The Company granted the underwriter a 45-day option from the date of the IPO to purchase up to additional Units to cover over-allotment, if any, at the IPO price less the underwriting discounts and commissions. On January 28, 2024, the underwriter did not exercise their over-allotment option and hence a total of ordinary shares were forfeited by the Sponsors.
The
Company will have until the last extended date, June 19, 2025, to consummate a Business Combination. However, if the Company has not
completed a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding
up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem
Proposed Business Combination
On June 7, 2024, the Company entered into the execution of an Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, Oabay Holding Company, a Cayman Islands exempted company limited by shares (“PubCo”), Bayview Acquisition Corp, a Cayman Islands exempted company limited by shares (“SPAC”), Bayview Merger Sub 1 Limited, a Cayman Islands exempted company limited by shares and a wholly-owned subsidiary of PubCo (“Merger Sub 1”), Bayview Merger Sub 2 Limited, a Cayman Islands exempted company limited by shares and a wholly-owned subsidiary of PubCo (“Merger Sub 2”), Oabay Merger Sub Limited, a Cayman Islands exempted company limited by shares and a wholly-owned subsidiary of PubCo (“Merger Sub 3”), BLAFC Limited, a business company limited by shares in the British Virgin Islands, Bayview Holding LP, a Delaware limited partnership, and Peace Investment Holdings Limited, pursuant to which, subject to the satisfaction or waiver of certain conditions set forth therein, (i) SPAC will merge with and into Merger Sub 1, with SPAC surviving the merger in accordance with the Companies Act (As Revised) of the Cayman Islands (the “Act”) (the “First SPAC Merger”), (ii) immediately following the First SPAC Merger, SPAC will merge with and into Merger Sub 2, with Merger Sub 2 surviving the Merger in accordance with the Act (the “Second SPAC Merger” and together with the First SPAC Merger, the “Initial Mergers”), and (iii) following the Initial Mergers, Merger Sub 3 will merge with and into the Company, with the Company being the surviving entity and becoming a wholly-owned subsidiary of PubCo in accordance with the Act (the transactions contemplated by the Merger Agreement, the “Business Combination”).
| 7 |
On
June 26, 2024, the Company entered into Amendment No. 1 to the Merger Agreement, pursuant to which all parties agreed to revise the earnout
milestones to reflect new consolidated revenue metrics. Among other things, the
Extension
On
September 16, 2024, the Company held an extraordinary general meeting virtually and in person, solely with respect to voting on (i) the
proposal to extend the date by which the Company must complete its initial business combination from September 19, 2024 to June 19, 2025,
with all nine (9) extensions comprised of one month each and (ii) the proposal to amend the Company’s investment management trust
agreement, dated December 14, 2023 by and between the Company and Equiniti Trust Company, LLC to allow the Company to extend the Termination
Date up to nine (9) times, with all nine (9) extensions comprised of one month each from the Termination Date to June 19, 2025 by providing
five days’ advance notice to the Trustee prior to the applicable Termination Date and depositing into the Trust Account $
In
connection with the vote to approve the Extension Amendment Proposal and the Trust Agreement Amendment Proposal, the holders of
Ordinary Shares properly exercised their rights to redeem their shares for cash at a redemption price of approximately $ per share,
for an aggregate redemption amount of approximately $
On
September 16, 2024, the Company issued a promissory note to Oabay, pursuant to which the Company could borrow an aggregate of $
Going Concern Consideration
As
of September 30, 2024, the Company had cash of $
| 8 |
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the SEC. These unaudited financial statements should be read in conjunction with the audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2023 filed by the Company with the SEC on April 16, 2024.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of Estimates
The preparation of the financial statement in conformity with US GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statement, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
| 9 |
Cash and cash equivalents
The
Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company had a cash and cash equivalent balance of $
Investments Held in Trust Account
The
Company’s portfolio of investments held in the trust account is comprised of investments in U.S. government securities with a maturity
of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest
only in direct U.S. government treasury obligations and Money Market Fund. The Company’s investments held in the trust account
are classified as trading securities. Trading securities are presented on the balance sheet at fair value at the end of each reporting
period. Gains and losses resulting from the change in fair value of investments held in Trust Account are included in interest earned
on marketable securities held in trust account in the accompanying statements of operations. The estimated fair value of investments
held in the trust account is determined using available market information. As of September 30, 2024 and December 31, 2023, the Trust
Account had balances of $
Offering Costs
Offering costs consist of legal, accounting, and other costs (including underwriting discounts and commissions) incurred through the balance sheet date that are directly related to the IPO and that were charged to shareholders’ equity upon the completion of the IPO on December 19, 2023.
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
ASC
740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions
taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be
sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits
as income tax expense. There were
There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s financial statements.
The Company complies with accounting and disclosure requirements of FASB ASC 260, Earnings Per Share. The statements of operations include a presentation of income (loss) per redeemable share and income (loss) per non-redeemable share following the two-class method of income per share. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable shares and non-redeemable shares and the undistributed income (loss) is calculated using the total net loss less any dividends paid. The Company then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable shares. Any remeasurement of the accretion to redemption value of the common shares subject to possible redemption was considered to be dividends paid to the public shareholders. As of September 30, 2024, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company. As a result, diluted income (loss) per share is the same as basic income (loss) per share for the period presented.
| 10 |
The net income (loss) per share presented in the statements of operations is based on the following:
| For The Three Months | For The Three Months | For The Nine Months | For the period From February 16, 2023 (inception) | |||||||||||||
| Ended | Ended | Ended | through | |||||||||||||
| September 30, | September 30, | September 30, | September 30, | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net income (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Interest earned from trust account | ( | ) | ( | ) | ||||||||||||
| Accretion of temporary equity into redemption value (extension deposit) | ( | ) | ( | ) | ||||||||||||
| Net loss including accretion of temporary equity to redemption value | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
For the three months ended September 30, 2024 | For the three months ended September 30, 2023 | |||||||||||||||
| Redeemable | Non- Redeemable | Redeemable | Non- Redeemable | |||||||||||||
| Shares | Shares | Shares | Shares | |||||||||||||
| Basic and diluted net income (loss) per share: | ||||||||||||||||
| Numerators: | ||||||||||||||||
| Allocation of net loss including accretion of temporary equity | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| Income earned on investment held in Trust Account | ||||||||||||||||
| Accretion of temporary equity to redemption value (extension deposit) | ||||||||||||||||
| Allocation of net income (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Denominators: | ||||||||||||||||
| Weighted-average shares outstanding | ||||||||||||||||
| Basic and diluted net income (loss) per share | $ | $ | ) | $ | $ | ) | ||||||||||
For the nine months ended September 30, 2024 | For the period from February 16, 2023 (inception) through September 30, 2023 | |||||||||||||||
| Redeemable | Non- Redeemable | Redeemable | Non- Redeemable | |||||||||||||
| Shares | Shares | Shares | Shares | |||||||||||||
| Basic and diluted net income (loss) per share: | ||||||||||||||||
| Numerators: | ||||||||||||||||
| Allocation of net loss including accretion of temporary equity | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| Income earned on investment held in Trust Account | ||||||||||||||||
| Accretion of temporary equity to redemption value (extension deposit) | ||||||||||||||||
| Allocation of net income (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Denominators: | ||||||||||||||||
| Weighted-average shares outstanding | ||||||||||||||||
| Basic and diluted net income (loss) per share | $ | $ | ) | $ | $ | ) | ||||||||||
Concentration of Credit Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution,
which, at times, may exceed the Federal Depository Insurance Coverage of $
| 11 |
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the balance sheet, primarily due to their short-term nature.
The Company accounts for its ordinary shares subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. The Company’s ordinary shares features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheet. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital and accumulated deficit.
| Public offering proceeds | $ | |||
| Less: | ||||
| Proceeds allocated to Public Rights | ( | ) | ||
| Allocation of offering costs related to redeemable shares | ( | ) | ||
| Plus: | ||||
| Accretion of carrying value to redemption value | ||||
| Ordinary shares subject to possible redemption | $ | |||
| Plus: | ||||
| Subsequent measurement of ordinary shares subject to possible redemption (income earned on trust account) | ||||
| Ordinary shares subject to possible redemption as of December 31, 2023 | $ | |||
| Less: | ||||
| Withdrawn in connection with redemption | ( | ) | ||
| Plus: | ||||
| Subsequent measurement of ordinary shares subject to possible redemption (extension deposit) | ||||
| Subsequent measurement of ordinary shares subject to possible redemption (income earned on trust account) | ||||
| Ordinary shares subject to possible redemption as of September 30, 2024 |
Recent Accounting Standards
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.
NOTE 3 — INITIAL PUBLIC OFFERING
On
December 19, 2023, the Company sold Units at a price of $ per Unit.
NOTE 4 — PRIVATE PLACEMENTS
Simultaneously
with the closing of the IPO, the Company consummated the private sale of Private Placement Units at a price of $ per Private
Placement Unit, generating gross proceeds of $
| 12 |
NOTE 5 — RELATED PARTIES
Founder Shares
On
February 23, 2023, our sponsor, Bayview Holding LP, acquired founder shares for an aggregate price of $
On
December 14, 2023, the Company issued founder shares for a consideration of $, resulting in Bayview Holding LP holding a total
of founder shares and Peace Investment Holdings Limited holding a total of founder shares. The payment of $
On January 28, 2024, a total of ordinary shares were forfeited by the Sponsors subsequent to the IPO as the underwriter’s over-allotment option was not exercised.
Promissory Note — Related Party
On
February 23, 2023, the Sponsors issued an unsecured promissory note to the Company (the “Promissory Note”), pursuant to which
the Company may borrow up to an aggregate principal amount of $
Due to Related Party
The
Sponsors paid certain formation, operating or deferred offering costs on behalf of the Company. These amounts were due on demand and
non-interest bearing, which was fully repaid upon closing of the IPO on December 19, 2023. As of September 30, 2024 and December 31,
2023, amount due to related party was $
Accounting Service Agreement
The
Company has engaged Ascendant Global Advisors, Inc., a related part of the Sponsors, to assist in preparing quarterly and annual financial
statements. The Company has agreed to pay for such services at a fixed quarterly rate of $
| 13 |
NOTE 6 — COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the Founder Shares, Private Placement Units, securities underlying the unit purchase option (“UPO”), and Units that may be issued upon conversion of working capital loans (and all underlying securities) will be entitled to registration rights pursuant to a registration rights agreement requiring the Company to register such securities for resale. Subject to certain limitations set forth in such agreement, the holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreement provides that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until the securities covered thereby are released from their lock-up restrictions. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The Company granted the underwriter a 45-day option from the date of IPO to purchase up to additional Units to cover over-allotment, at the IPO price less the underwriting discounts and commissions. On January 28, 2024, the underwriter did not exercise their over-allotment option and hence a total of ordinary shares were forfeited by the Sponsors.
The
underwriter was entitled to a cash underwriting discounts of $
The
underwriter will be entitled to a deferred commission of $
Unit Purchase Option
We
have agreed to sell to Chardan and/or its designees, for $
Business Combination Transaction Costs
The
Company has engaged several service providers specifically for the potential business combination. Per the agreed terms with Oabay, Oabay
will be responsible for the expenses incurred in connection with the business combination. During the nine months ended September 30,
2024, $
Finder’s Agreement
The Company entered into an agreement with a consultant to help introduce and identify potential business targets and negotiate terms of potential Business Combination. In connection with this agreement, the Company will be required to pay a finder’s fee for such services, in an aggregate of shares of the combined listing entity upon the closing of the Business Combination.
NOTE 7 — SHAREHOLDERS’ EQUITY
Preferred
Shares — The Company is authorized to issue preferred shares with a par value of $ per share with such
designations,
Ordinary Shares — The Company is authorized to issue ordinary shares with a par value of $ per share. Holders of ordinary shares are entitled to one vote for each share.
On
February 23, 2023, our sponsor, Bayview Holding LP, acquired founder shares for an aggregate price of $
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On
December 14, 2023, the Company issued founder shares for a consideration of $, resulting in Bayview Holding LP holding a total
of founder shares and Peace Investment Holdings Limited holding a total of founder shares. The payment of $
Considered the nominal issuance, there was ordinary shares issued and outstanding and no public ordinary shares subject to redemption as of September 30, 2023. A total of ordinary shares held by the Sponsors were subject to forfeiture as of September 30, 2023.
As of September 30, 2024 and December 31, 2023, there were and ordinary shares issued and outstanding, respectively, excluding the and ordinary shares subject to possible redemption, which are presented as temporary equity.
Rights — Except in cases where the Company is not the surviving company in a business combination, The Company will not issue fractional shares in connection with an exchange of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of Cayman law. In the event the Company is not the surviving company upon completion of the initial Business Combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the one-tenth (1/10) of one ordinary share underlying each right upon consummation of the business combination. If the Company is unable to complete the initial Business Combination within the required time period and the Company will redeem the public shares for the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless.
NOTE 8 — Fair Value Measurements
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.
The following tables present information about the Company’s assets that are measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023 and indicate the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
| Quoted | Significant | Significant | ||||||||||||||
| Prices in | Other | Other | ||||||||||||||
| As of | Active | Observable | Unobservable | |||||||||||||
| September 30, | Markets | Inputs | Inputs | |||||||||||||
| 2024 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
| Assets: | ||||||||||||||||
| Investment held in trust account | $ | $ | $ | $ | ||||||||||||
| Quoted | Significant | Significant | ||||||||||||||
| As of | Prices in | Other | Other | |||||||||||||
| December | Active | Observable | Unobservable | |||||||||||||
| 31, | Markets | Inputs | Inputs | |||||||||||||
| 2023 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
| Assets: | ||||||||||||||||
| Investment held in trust account | $ | $ | $ | $ | ||||||||||||
NOTE 9 — SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were issued. Based on the review, management identified the following subsequent event that is required disclosure in the financial statements:
| (1) | On
October 14, 2024, the Company issued a promissory note to Oabay, pursuant to which the Company
could borrow an aggregate of $ |
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
We are a blank check company incorporated on February 16, 2023, as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses, which we refer to throughout the Registration Statement as our initial business combination. We have generated no revenues to date, and we do not expect that we will generate operating revenues at the earliest until we consummate our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us.
Results of Operations and Known Trends or Future Events
We have neither engaged in any operations nor generated any revenues to date. Our only activities since February 16, 2023 (inception) to September 30, 2024, have been organizational activities and those necessary to prepare for the Initial Public Offering (the “IPO”) described below and identifying a target company for initial Business Combination.. Following our IPO, we would not generate any operating revenues until the completion of our initial business combination. We would generate non-operating income in the form of interest income after the IPO. We expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.
For the three months ended September 30, 2024, we had a net income of $583,558, which consists of income earned on investment held in Trust Account of $856,587 offset by loss of $273,029 derived from formation and operating costs.
For the nine months ended September 30, 2024, we had a net income of $1,771,223, which consists of income earned on investment held in Trust Account of $2,324,692 offset by loss of $553,469 derived from formation and operating costs.
For the three months ended September 30, 2023, we had a net loss of $3,823, which consists of loss of $3,823 derived from formation and operating costs.
For the period from February 16, 2023 (inception) through September 30, 2023, we had a net loss of $6,928, which consists of loss of $6,928 derived from formation and operating costs.
Liquidity and Capital Resources
On December 19, 2023, we consummated our IPO of 6,000,000 Units, at $10.00 per Unit, generating gross proceeds of $60,000,000. Simultaneously with the closing of the IPO, we consummated the sale of 232,500 Private Placement Units at a price of $10.00 per Private Placement Unit, generating total gross proceeds of $2,325,000. Following the closing of the IPO, an amount of $60,000,000 from the net proceeds of the sale of the Units in the IPO and the Private Placement was held in a trust account. The funds held in the trust account may be invested in U.S. government securities with a maturity of 185 days or less or in any open-ended investment company that holds itself out as a money market fund selected by us.
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We granted the underwriter a 45-day option to purchase up to an additional 900,000 Units at the IPO price to cover over-allotment, if any. On January 28, 2023, a total of 225,000 ordinary shares were forfeited by the Sponsors since the underwriter did not exercise their over-allotment option.
As of September 30, 2024, our cash and cash equivalent balance was $225,472. We will use these funds primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a business combination.
We expect our primary liquidity requirements during that period to include approximately $200,000 in legal, accounting, due diligence and other fees in connection with the business combination; $100,000 in legal and accounting related to regulatory reporting obligations, $120,000 for office space, administrative and support services, $55,000 in NASDAQ continued listing fees and $100,000 for miscellaneous expenses, including director and officer’s liability insurance, general corporate purposes, liquidation obligations and reserves.
As indicated in the accompanying financial statements, as of September 30, 2024, we had a working capital deficit of $308,229. Further, we have incurred and expect to continue to incur significant costs in pursuit of our financing and acquisition plans.
Quantitative and Qualitative Disclosures about Market Risk
The net proceeds of the IPO and the sale of the Private Placement Units held in the trust account will be invested in U.S. government treasury bills with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk.
Related Party Transactions
Please refer to Financial Statements Note 5 – Related Parties.
Off-Balance Sheet Arrangements; Commitments and Contractual Obligations; Quarterly Results
As of September 30, 2024, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations. No unaudited quarterly operating data is included in the Registration Statement, as we have conducted no operations to date.
JOBS Act
On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company”, we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of the IPO or until we are no longer an “emerging growth company,” whichever is earlier.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our current chief executive officer and chief financial officer (our “Certifying Officers”), the effectiveness of our disclosure controls and procedures as of September 30, 2024, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded that, as of September 30, 2024, our disclosure controls and procedures were effective.
We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Management’s Report on Internal Controls Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as that term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) and for our assessment of the effectiveness of internal control over financial reporting. Our internal control over financial reporting is a process designed under the supervision of our Chief Executive Officer and our Chief Financial Officer, and effected by our Board, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with U.S. generally accepted accounting principles and includes those policies and procedures that: (1) pertain to the maintenance of records that in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management, including our Chief Executive Officer and Chief Financial Officer, has conducted an assessment regarding the effectiveness of our internal control over financial reporting as of September 30, 2024, based on the framework established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our assessment under the criteria described above, management has concluded that our internal control over financial reporting was not effective as of September 30, 2024, solely due to the material weakness in our internal control over financial reporting related to the Company’s lack of qualified SEC reporting professional. As a result, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. GAAP. Accordingly, management believes that the financial statements included in this Form 10-Q present fairly, in all material respects, our financial position, result of operations and cash flows for the periods presented. Management intends to continue implement remediation steps to improve our disclosure controls and procedures and our internal control over financial reporting. Specifically, we intend to expand and improve our review process for complex securities and related accounting standards. We have improved this process by enhancing access to accounting literature, identification of third-party professionals with whom to consult regarding complex accounting applications and consideration of additional staff with the requisite experience and training to supplement existing accounting professionals.
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Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 1A. RISK FACTORS
Factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in (i) our final prospectus for our Initial Public Offering filed with the SEC on December 19, 2023, and (ii) our annual report on Form 10-K filed with the SEC on April 16, 2024. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in (i) our final prospectus for our Initial Public Offering filed with the SEC on December 19, 2023 or (ii) our annual report on Form 10-K filed with the SEC on April 16, 2024, except we may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Unregistered Sales of Equity Securities
On February 23, 2023, our sponsor, Bayview Holding LP acquired 1,437,500 founder shares for an aggregate purchase price of $25,000, of which Bayview Holding LP owns 474,375 ordinary shares and Peace Investment Holdings Limited owns 963,125 ordinary shares. On December 14, 2023, the Company issued an additional 287,500 founder shares for consideration of $100, resulting in Bayview Holding LP holding a total of 569,250 founder shares and Peace Investment Holdings Limited holding a total of 1,155,750 founder shares as of the date of the Registration Statement. On January 28, 2024, a total of 225,000 founder shares were forfeited by the Sponsors as the underwriters did not exercise their over-allotment option.
Simultaneously with the closing of the IPO, pursuant to a Private Placement Unit Purchase Agreement, the Company completed the private sale of 232,500 Private Placement Units to the Sponsors at a purchase price of $10.00 per Private Placement Unit generating gross proceeds to the Company of $2,325,000. The Private Placement Units are identical to the Units sold in the IPO. No underwriting discounts or commissions were paid with respect to such sale. The issuance of the Private Placement Units was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended.
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Use of Proceeds
On December 19, 2023, the Company consummated the initial public offering of 6,000,000 Units (the “Units” and, with respect to the Ordinary shares included in the Units sold, the “Public Shares”), at $10.00 per Unit, generating gross proceeds of $60,000,000.
Simultaneously with the closing of the initial public offering, we consummated the sale of 232,500 Private Placement Units at a price of $10.00 per Unit, generating gross proceeds of $2,325,000.
On February 23, 2023, we issued an unsecured promissory note to our Sponsors (the “Promissory Note”), pursuant to which we received proceeds of $300,000 to cover expenses related to the initial public offering. The Promissory Note was non-interest bearing and payable on the earlier of (i) December 31, 2023, or (ii) the consummation of the IPO. As of December 19, 2023, there were no amounts outstanding under the Promissory Note and the Promissory Note then expired.
Transaction costs related to the issuances described above amounted to $4,341,321, consisting of $1,200,000 of cash underwriting fees, $2,100,000 of deferred underwriting fees and $1,041,321 of other offering costs. After deducting the underwriting discounts and commissions and offering expenses, the total net proceeds from the initial public offering and the sale of the Private Placement Units $60,000,000 (or $10.00 per share sold in the initial public offering) was placed in the Trust Account.
Redemptions
On September 16, 2024,a special meeting of the stockholders was held to extend the date by which the Company must consummate a business combination. In connection with this meeting, the stockholders of record were provided the opportunity to exercise their redemption rights. Holders 2,290,989 Ordinary Shares properly exercised their rights to redeem their shares for cash at a redemption price of approximately $10.39 per share, for an aggregate redemption amount of approximately $23,803,376. Following the redemptions, the Company has 5,441,511 ordinary shares outstanding.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
* Filed herewith.
**These certifications are furnished to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| BAYVIEW ACQUISITION CORP | ||
| By: | /s/ Xin Wang | |
| Name: | Xin Wang | |
| Title: | Principal Executive Officer | |
Pursuant to the requirements of the Securities Act of 1933, as amended, this Quarterly Report has been signed below by the following persons in the capacities and on the dates indicated.
| Signature | Position | Date | ||
| /s/Xin Wang | Principal Executive Officer and Director | November 14, 2024 | ||
| Xin Wang | (Principal Executive Officer) | |||
| /s/ David Bamper | Principal Financial Officer | November 14, 2024 | ||
| David Bamper | (Principal Financial Officer and Principal Accounting Officer) | |||
| /s/ Yuk Man Lau | Chairman | November 14, 2024 | ||
| Yuk Man Lau |
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