Distoken Acquisition (DIST) - 2024 Q3 - Quarterly Report

Financial Performance - As of September 30, 2024, the Company reported a net income of $195,738, driven by interest income of$555,371 from marketable securities held in the Trust Account, offset by operating costs of $326,185 and Chinese income tax of$33,448[179]. - For the nine months ended September 30, 2024, the Company had a net income of $100,345, consisting of interest income of$1,644,669, offset by operating costs of $1,510,876 and Chinese income tax of$33,448[179]. - For the three months ended September 30, 2023, the company reported a net income of $391,367, driven by interest income of$914,783 and an unrealized gain of $26,564 on marketable securities, offset by operating costs of$428,379 and Chinese income tax of $121,601[180]. - For the nine months ended September 30, 2023, the company achieved a net income of$1,080,034, with interest income of $2,143,508 and an unrealized gain of$16,128 on marketable securities, while cash used in operating activities was $637,824[181][187]. Business Combination Plans - The Company has incurred significant costs in pursuit of acquisition plans and does not expect to generate operating revenues until after completing a business combination[158]. - On November 10, 2023, shareholders approved an extension allowing the Company to consummate a Business Combination until November 18, 2024, with 3,018,308 ordinary shares redeemed for a total of$31.9 million[162]. - The Company entered into a Business Combination Agreement with Youlife Group Inc. on May 17, 2024, involving a merger that will result in Youlife becoming a wholly-owned subsidiary of Pubco[172]. - On November 13, 2024, the Company amended the Business Combination Agreement to adopt an American depository share facility and revise lock-up provisions[173]. - The Company has made total extension deposits of $330,000 into the Trust Account to extend the time to complete an initial Business Combination to October 18, 2024[164]. - The company plans to extend the time to complete an initial business combination from November 18, 2024, to December 18, 2024, by depositing a$30,000 monthly extension payment into the Trust Account[199]. Financial Position and Capital Needs - As of September 30, 2024, the company had investments in the Trust Account amounting to $43,355,649, including$3,432,390 of interest income, primarily in money market funds invested in U.S. government securities[195][208]. - The company had cash of $10,598 outside the Trust Account as of September 30, 2024, intended for identifying and evaluating target businesses and conducting due diligence[196]. - The company may need to raise additional capital through loans or investments to complete a business combination, and there is uncertainty regarding the ability to secure such financing[199]. - The company has no long-term debt or off-balance sheet arrangements as of September 30, 2024, and has engaged I-Bankers for advisory services related to potential business combinations[203][205]. Transaction Costs and Financing - The company incurred transaction costs of$4,366,343 during its initial public offering, with gross proceeds of $69,000,000 from the sale of 6,900,000 units at$10.00 per unit[184][185]. - The company issued a promissory note on November 10, 2023, for up to $360,000 to the Sponsor for monthly deposits into the Trust Account until November 18, 2024[163]. - The company issued the 2023 Extension Note for up to$360,000 to the sponsor, with monthly payments of $30,000 for each month until the business combination is completed, as of September 30, 2024,$330,000 was outstanding under this note[189]. Accounting Standards - Management does not believe the adoption of ASU 2023-09 will have a material impact on financial statements and disclosures[213]. - Management does not believe that any other recently issued accounting standards would have a material effect on financial statements[214]. Regulatory Considerations - The 2024 SPAC Rules may materially affect the Company's ability to negotiate and complete its initial Business Combination, increasing costs and time related to the process[159]. - On November 10, 2023, shareholders approved the 2023 Extension Amendment, allowing the company to extend the deadline for completing a business combination up to twelve times until November 18, 2024, with $31.9 million redeemed from the Trust Account[188]. Fair Value Measurements - The fair value of public rights at issuance amounted to$3,305,100[211]. - The fair value of public warrants at issuance amounted to $1,104,000, while the fair value of representative warrants at issuance amounted to$12,075[212].