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Launch Two Acquisition Corp.(LPBBU) - 2024 Q4 - Annual Report
LPBBULaunch Two Acquisition Corp.(LPBBU)2025-03-25 21:29

IPO and Financing - The company completed its Initial Public Offering on October 9, 2024, raising gross proceeds of 230millionfromthesaleof23millionUnitsat230 million from the sale of 23 million Units at 10.00 per Unit[24]. - An additional 7.075millionwasgeneratedfromtheprivatesaleof7,075,000PrivatePlacementWarrantsat7.075 million was generated from the private sale of 7,075,000 Private Placement Warrants at 1.00 each[25]. - A total of 231.15millionfromtheIPOandPrivatePlacementwasplacedintheTrustAccount[26].−Thecompanyhas231.15 million from the IPO and Private Placement was placed in the Trust Account[26]. - The company has 220,200,000 available for a Business Combination as of December 31, 2024, after paying 10,950,000inDeferredFees[55].−ThecompanymayneedadditionalfinancingtocompleteitsinitialBusinessCombinationifthecashrequiredexceedstheamountavailableintheTrustAccount[50].−Thecompanyhasapproximately10,950,000 in Deferred Fees[55]. - The company may need additional financing to complete its initial Business Combination if the cash required exceeds the amount available in the Trust Account[50]. - The company has approximately 1,175,000 of proceeds held outside the Trust Account to cover costs associated with the dissolution plan[94]. - The company may need to obtain additional financing to complete its Business Combination or to redeem a significant number of Public Shares[160]. Business Combination Requirements - The company must complete its initial Business Combination by October 9, 2026, which is 24 months from the IPO closing date[27]. - If the initial Business Combination is not completed within the Combination Period, the company will redeem 100% of the Public Shares at an estimated price of 10.05pershare[43].−TheNasdaqRulesrequirethatthecompanymustcompleteoneormorebusinesscombinationswithanaggregatefairmarketvalueofatleast8010.05 per share[43]. - The Nasdaq Rules require that the company must complete one or more business combinations with an aggregate fair market value of at least 80% of the assets held in the Trust Account[44]. - The company intends to structure its initial Business Combination to acquire 100% of the equity interests or assets of the target business[45]. - The company intends to target businesses with enterprise values greater than the net proceeds from its Initial Public Offering and Private Placement Warrants[50]. - The company anticipates sourcing potential initial Business Combination targets from various unaffiliated sources, including investment bankers and private investment funds[51]. - The company may engage finders to identify business combination opportunities, with fees typically tied to the completion of a transaction[53]. - Shareholder approval may be required for the initial Business Combination under certain conditions, such as significant changes in ownership or control[61][62]. - The company may conduct redemptions without a shareholder vote under specific circumstances, but will seek approval if required by law or stock exchange rules[60]. - The company may not complete the initial Business Combination if the cash required for redemptions exceeds the available cash[83]. Shareholder Rights and Redemption - Public Shareholders may redeem their shares either through a general meeting or a tender offer, with the decision made at the company's discretion[72]. - A quorum for shareholder meetings requires at least one third of issued and outstanding shares, equating to 7,500,001 or 37.5% of the 20,000,000 Public Shares sold in the Initial Public Offering[77]. - If shareholder approval is sought, a Public Shareholder is restricted from seeking redemption rights for more than 15% of the shares sold in the Initial Public Offering without prior consent[84]. - Redemption requests must be submitted two business days prior to the scheduled vote or tender offer deadline[82]. - If the initial Business Combination is not approved, Public Shareholders who elected to redeem their shares will not be entitled to redeem for their pro rata share of the Trust Account[89]. - The company intends to require Public Shareholders to deliver share certificates or use electronic delivery for redemption[86]. - Any request to redeem shares may be withdrawn at any time up to the specified date in the proxy materials or tender offer documents[88]. - The transfer agent typically charges a fee of approximately 100 for processing share deliveries related to redemption rights[87]. Financial Performance and Obligations - The company had net income of 2,108,350fortheyearendedDecember31,2024,primarilyfrominterestincomeonmarketablesecurities[151].−AsofDecember31,2024,thecompanyheldmarketablesecuritiesintheTrustAccountamountingto2,108,350 for the year ended December 31, 2024, primarily from interest income on marketable securities[151]. - As of December 31, 2024, the company held marketable securities in the Trust Account amounting to 233,431,141[157]. - Cash used in operating activities from inception through December 31, 2024, was 334,067[156].−Thecompanyincurredgeneralandadministrativecostsof334,067[156]. - The company incurred general and administrative costs of 173,185 during the same period[151]. - The company has not paid any cash dividends to date and does not intend to do so prior to completing its initial Business Combination[139]. - The company’s obligation to redeem Public Shares may reduce available resources for the initial Business Combination[103]. - The company cannot assure shareholders that the actual per-share redemption amount will not be substantially less than 10.05duetopotentialclaimsagainsttheTrustAccount[95].RisksandChallenges−Thelackofbusinessdiversificationmayposerisksasthecompany′ssuccesscoulddependentirelyontheperformanceofasinglebusinesspost−combination[56].−ThecompanymayfacecompetitionfromotherSPACs,privateequitygroups,andpubliccompaniesinidentifyingtargetbusinessesforacquisition[103].−ThereisnoguaranteethatallvendorsandserviceproviderswillexecuteagreementswaivingclaimstotheTrustAccount,whichcouldexposethecompanytocreditorclaims[97].−Thecompanyissubjecttovariousrisks,includingpotentialconflictsofinterestandchallengesinfindingsuitablebusinesstargets[116].GovernanceandManagement−Themanagementteamiscomposedofexperiencedexecutivesfromthelifesciencesandfinancialservicessectors,enhancingthecompany′sacquisitioncapabilities[29].−Thecompanyhasadiverseboardofdirectorswithextensiveexperienceinfinancialservicesandtechnology[181][182][183][184].−TheAuditCommitteeconsistsofthreeindependentmembers,ensuringcompliancewithNasdaqandSECrules[196].−TheCompensationCommitteeisresponsibleforreviewingandapprovingexecutivecompensationandincentiveplans[199].−Thecompanydoesnothaveastandingnominatingcommitteebutindependentdirectorscanrecommendnominees[203].−Thecompanyhasadoptedinsidertradingpoliciestopromotecompliancewithrelevantlawsandregulations[208].−TheAuditCommitteereviewsallpaymentsmadetotheSponsor,executiveofficers,ordirectorsonaquarterlybasis[215].ComplianceandReporting−ThecompanyisrequiredtoevaluateinternalcontrolproceduresforthefiscalyearendingDecember31,2025,asmandatedbytheSarbanes−OxleyAct[107].−ThecompanyhasnocurrentintentionofsuspendingitsreportingobligationsundertheExchangeActpriortooraftertheinitialBusinessCombination[109].−Thecompany’sdisclosurecontrolsandproceduresweredeemedeffectiveasofDecember31,2024[172].−Thecompanyhasnochangesininternalcontroloverfinancialreportingtoreport[176].−Thecompanyisclassifiedasan"emerginggrowthcompany"andcandelaytheadoptionofcertainaccountingstandardsuntiltheyapplytoprivatecompanies[111].−Thecompanyisclassifiedasa"smallerreportingcompany,"allowingittoprovideonlytwoyearsofauditedfinancialstatements[114].−Themarketvalueofthecompany′sClassAOrdinarySharesheldbynon−affiliatesmustexceed10.05 due to potential claims against the Trust Account[95]. Risks and Challenges - The lack of business diversification may pose risks as the company's success could depend entirely on the performance of a single business post-combination[56]. - The company may face competition from other SPACs, private equity groups, and public companies in identifying target businesses for acquisition[103]. - There is no guarantee that all vendors and service providers will execute agreements waiving claims to the Trust Account, which could expose the company to creditor claims[97]. - The company is subject to various risks, including potential conflicts of interest and challenges in finding suitable business targets[116]. Governance and Management - The management team is composed of experienced executives from the life sciences and financial services sectors, enhancing the company's acquisition capabilities[29]. - The company has a diverse board of directors with extensive experience in financial services and technology[181][182][183][184]. - The Audit Committee consists of three independent members, ensuring compliance with Nasdaq and SEC rules[196]. - The Compensation Committee is responsible for reviewing and approving executive compensation and incentive plans[199]. - The company does not have a standing nominating committee but independent directors can recommend nominees[203]. - The company has adopted insider trading policies to promote compliance with relevant laws and regulations[208]. - The Audit Committee reviews all payments made to the Sponsor, executive officers, or directors on a quarterly basis[215]. Compliance and Reporting - The company is required to evaluate internal control procedures for the fiscal year ending December 31, 2025, as mandated by the Sarbanes-Oxley Act[107]. - The company has no current intention of suspending its reporting obligations under the Exchange Act prior to or after the initial Business Combination[109]. - The company’s disclosure controls and procedures were deemed effective as of December 31, 2024[172]. - The company has no changes in internal control over financial reporting to report[176]. - The company is classified as an "emerging growth company" and can delay the adoption of certain accounting standards until they apply to private companies[111]. - The company is classified as a "smaller reporting company," allowing it to provide only two years of audited financial statements[114]. - The market value of the company's Class A Ordinary Shares held by non-affiliates must exceed 250 million or annual revenues must reach $100 million to lose its smaller reporting company status[114]. - The company anticipates that its securities may be less attractive to potential target companies due to its classification as a smaller reporting company[125]. Miscellaneous - The company has not encountered any cybersecurity incidents since its Initial Public Offering[131]. - The company has not identified a target for its initial Business Combination, which may affect the share price post-transaction[124]. - The company may amend agreements related to its Initial Public Offering without shareholder approval, which could impact the value of its securities[127]. - The company has adopted a Clawback Policy to recover erroneously awarded incentive-based compensation from executive officers in the event of an accounting restatement[212]. - The company has not established any specific minimum qualifications for director candidates, focusing instead on educational background and professional experience[205].