SEC Form 10-K filed by Bowen Acquisition Corp
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For
the fiscal year ended
For the transition period from ___________ to ____________
Commission
File Number
(Exact name of registrant as specified in its charter)
(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) (Zip Code)
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The Stock Market LLC | ||||
| The Stock Market LLC | ||||
| The Stock Market LLC |
Securities registered pursuant to Section 12(g) of the Act: None
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes ☐
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934
during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject
to such filing requirement 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 during the preceding 12 months (or for 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 has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report.
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As
of June 28, 2024 (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregate market
value of the ordinary shares held by non-affiliates of the registrant was approximately $
As of April 15, 2025, Ordinary Shares, par value $ per share, were issued and outstanding.
Documents
Incorporated by Reference:
BOWEN ACQUISITION CORP
FORM 10-K
TABLE OF CONTENTS
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS; SUMMARY OF RISK FACTORS
Certain statements in this Annual Report on Form 10-K (the “Annual Report”) of Bowen Acquisition Corp (the “Company,” “we,” “us,” “our” or “Bowen”) may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Annual Report may include, for example, statements about:
| ● | our ability to complete our initial business combination; | |
| ● | our expectations around the performance of prospective target business or businesses; | |
| ● | our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; | |
| ● | our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination; | |
| ● | our potential ability to obtain additional financing to complete our initial business combination; | |
| ● | our pool of prospective target businesses; | |
| ● | our public securities’ potential liquidity and trading; | |
| ● | the lack of a market for our securities; | |
| ● | the use of proceeds not held in the Trust Account (as defined below) or available to us from interest income on the Trust Account balance; | |
| ● | the Trust Account not being subject to claims of third parties; or | |
| ● | our financial performance. |
The forward-looking statements contained in this Annual Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the section of this Annual Report entitled “Risk Factors”. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
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PART I
ITEM 1. BUSINESS
We are a blank check company incorporated on February 17, 2023, in the Cayman Islands as an 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 or entities (a “Business Combination”).
Our sponsors are Createcharm Holdings Ltd and Bowen Holding LP (each a “Sponsor” and collectively the “Sponsors”), each of which is affiliated with members of our management team. On February 27, 2023, Bowen Holdings LP acquired an aggregate of 1,725,000 of our ordinary shares, par value $0.0001 per share (such ordinary shares generally, the “Ordinary Shares”, such 1,725,000 Ordinary Shares, the “Founder Shares”), for an aggregate purchase price of $25,000. Thereafter, it transferred an aggregate of 1,155,750 Founder Shares to Createcharm Holdings Ltd.
On March 15, 2023, the Company issued to EarlyBirdCapital, Inc. (“EBC” or “EarlyBirdCapital”), the representative of the underwriters in our initial public offering (“IPO” or “Initial Public Offering”) 180,000 Ordinary Shares (the “EBC Founder Shares”) for an aggregate purchase price of $2,520. On July 14, 2023, the Company consummated the IPO of 6,000,000 units (generally the “Units” and such Units as sold in the IPO, the “Public Units”). Each Unit consists of one Ordinary Share (Ordinary Shares included in the Public Units, the “Public Shares”), and one right (generally, the “Rights”, such Rights as included in the Public Units, the “Public Rights”), each Right entitling the holder thereof to receive one-tenth of one Ordinary Share upon the completion of a Business Combination. The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $60,000,000.
Simultaneously with the consummation of the Initial Public Offering, the Company consummated a private placement (the “Private Placement”) of 330,000 Units (“Private Placement Units”) at a price of $10.00 per Private Placement Unit, generating total proceeds of $3,300,000. The Private Placement Units were purchased by Createcharm Holdings Ltd and EarlyBirdCapital. The Private Placement Units are identical to the Units sold in the Initial Public Offering. The Ordinary Shares contained in the Private Placement Units are referred to herein as the “Private Placement Shares” and the Rights contained in the Private Placement Units are referred to herein as the “Private Placement Rights”).
On July 17, 2023, the underwriters exercised their over-allotment option in full to purchase an additional 900,000 Units. As a result, on July 18, 2023, the Company sold an additional 900,000 Units at $10.00 per Unit, generating gross proceeds of $9,000,000. In connection with the underwriters’ exercise of their over-allotment option, Createcharm Holdings Ltd and EarlyBirdCapital also purchased an aggregate of an additional 31,500 Private Placement Units from the Company, generating gross proceeds of $315,000.
Recent Developments
On January 18, 2024, Bowen, Bowen Merger Sub, a Cayman Islands exempted company and a wholly owned subsidiary of Bowen (“Merger Sub”), Shenzhen Qianzhi BioTechnology Co. Ltd., a company incorporated in the People’s Republic of China and a wholly owned subsidiary of NewCo (as defined below) (“Qianzhi”), and Qianzhi Group Holding (Cayman) Limited, a newly formed Cayman Islands company (“NewCo”, and collectively with Bowen, Merger Sub and Qianzhi, the “Parties”), entered into an Agreement and Plan of Reorganization (the “Business Combination Agreement”), which provides for a Business Combination between Bowen and Qianzhi.
The Business Combination Agreement contemplates that, at the closing of the Business Combination (the “Closing”), upon the terms and subject to the conditions of the Business Combination Agreement and in accordance with the Companies Act (Revised) of the Cayman Islands, as amended (the “Cayman Companies Act”), Merger Sub will merge with and into NewCo (the “Merger”), with NewCo being the surviving company of the Merger (“Surviving Company”) and becoming a wholly owned subsidiary of Bowen. In the Merger, the holders (the “NewCo Shareholders”) of the ordinary shares of NewCo (“NewCo Ordinary Shares”) will receive Ordinary Shares of the Company. The Merger and the other transactions contemplated by the Business Combination Agreement are referred to herein collectively as the “Transactions.” Consistent with the Business Combination Agreement and in preparation for the Transactions, Qianzhi and NewCo completed a restructuring (the “Restructuring”) in which Qianzhi became a wholly owned subsidiary of NewCo by the issuance of NewCo Ordinary Shares to the former holders of ordinary shares of Qianzhi in exchange for such ordinary shares of Qianzhi.
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Pursuant to the Business Combination Agreement, at the effective time of the Merger (the “Effective Time”), all NewCo Ordinary Shares issued and outstanding immediately prior to the Effective Time other than (i) NewCo Ordinary Shares held by the parties to the Business Combination Agreement or their respective wholly-owned subsidiaries and (ii) those NewCo Ordinary Shares owned by the holders of NewCo Ordinary Shares who have validly exercised and not effectively withdrawn or lost their rights to dissent from the Merger pursuant to the Cayman Companies Act, will be automatically converted into the right to receive an aggregate of (a) 7,246,377 Ordinary Shares of the Company, a portion of which shall be deposited into escrow to provide for indemnification in accordance with the Business Combination Agreement (the “Merger Shares”), and (b) the right to receive earnout consideration of up to an aggregate of 1,400,000 Ordinary Shares of the Company (the “Earnout Shares”), if and to the extent certain net income milestones are achieved by the combined company and its subsidiaries during the fiscal years ended March 31, 2025 and 2026 or if there occurs any transaction resulting in a change of control during the period of time that the Earnout Shares are earnable.
For additional information regarding Qianzhi and NewCo, the Business Combination Agreement and the Transactions, see the Company’s definitive proxy statement/prospectus, as filed with the Securities and Exchange Commission on December 18, 2024 (the “Definitive Proxy Statement/Prospectus”).
On October 14, 2024, Qianzhi and EarlyBirdCapital loaned the Company an aggregate of $690,000 (or $0.10 per Public Share), which funds were deposited into the Trust Account. The funds were deposited into the Trust Account pursuant to the Articles and the trust agreement governing the Trust Account in order to extend the time that the Company has to consummate an initial business combination from October 14, 2024 to April 14, 2025. The loans are evidenced by promissory notes issued by the Company to the lenders. The notes bear no interest and are repayable in full upon consummation of a Business Combination.
On January 10, 2025, the Company held an extraordinary general meeting to approve a proposal to extend the time the Company had to consummate its initial Business Combination to up to April 14, 2025. In connection with the meeting, an aggregate of 6,052,095 Public Shares were redeemed at a price of approximately $10.99 per share.
On April 14, 2025, the Company held an extraordinary general meeting to approve a proposal to extend the time the Company had to consummate its initial Business Combination to up to July 14, 2025. In connection with the meeting, an aggregate of 103,432 Public Shares were redeemed at a price of approximately $11.03 per share.
The Company is now in the process of seeking to satisfy the remaining conditions to the Closing and to consummate the Transactions. If the Company consummates the Transactions, the business of the Company will be that of Qianzhi. For further details regarding Qianzhi and its business, see the section titled “Information about NewCo and Qianzhi” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein. If the Company is unable to consummate the Transactions for whatever reason, it will either dissolve and liquidate in accordance with the terms of its amended and restated memorandum and articles of association or seek additional time to consummate an alternative Business Combination and attempt to locate and consummate such an alternative transaction. For further details regarding the Company and its business, see the section titled “Information about Bowen” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
If we are unable to consummate the Transactions and seek an alternative transaction, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment bankers and investment professionals. Target businesses may be brought to our attention by such unaffiliated sources as a result of being solicited by us by calls or mailings. These sources may also introduce us to target businesses in which they think we may be interested on an unsolicited basis, since many of these sources will know what types of businesses we are targeting. Our officers and directors, as well as our Sponsors, and their affiliates, may also bring to our attention target business candidates that they become aware of through their business contacts as a result of formal or informal inquiries or discussions they may have, as well as attending trade shows, conferences or conventions. In addition, we expect to receive a number of proprietary deal flow opportunities that would not otherwise necessarily be available to us as a result of the business relationships of our officers and directors and our Sponsors and their respective industry and business contacts as well as their affiliates. We may engage the services of professional firms or other individuals that specialize in business acquisitions, in which event we may pay a finder’s fee, consulting fee, advisory fee or other compensation to be determined in an arm’s length negotiation based on the terms of the transaction.
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ITEM 1A. RISK FACTORS
The Business Combination and each of Qianzhi and Bowen are subject to numerous risks and uncertainties. Accordingly, an investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this Annual Report on Form 10-K and the Definitive Proxy Statement/Prospectus before making a decision to invest in our securities. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. The risk factors described below are not necessarily exhaustive and you are encouraged to perform your own investigation with respect to us and our business.
Risks Relating to Qianzhi’s Business and Industry
| ● | If Qianzhi’s products fail to meet the demands of its customers or to reflect the latest developments in the personal hygiene and disinfection products market, it may be unable to retain existing customers or attract new customers, and its business, financial condition and results of operations may be materially and adversely affected. | |
| ● | A significant portion of Qianzhi’s revenue is concentrated with a small number of customers and it could be seriously harmed if these customers significantly reduced the volume of business they conduct, or cease doing business, with Qianzhi. | |
| ● | Qianzhi may be unable to maintain its relationships with its customers and Qianzhi may fail to engage new customers. | |
| ● | Qianzhi may be compelled to undertake product recalls or other actions, which could adversely affect its brand image, financial condition, results of operations, and growth prospects. | |
| ● | Qianzhi’s revenues and financial results may be adversely affected by an economic slowdown on a global scale or in any jurisdictions in which it operates. | |
| ● | Heightened tensions in international relations may adversely impact Qianzhi’s business, financial condition, and results of operations. | |
| ● | Qianzhi faces intense competition in the personal hygiene and disinfection products industry from numerous competitors. | |
| ● | Qianzhi is subject to cost overruns and delays, regulatory requirements, and miscalculations in capacity needs with respect to its expansion projects and its manufacturing facilities, as well as disruptions to its manufacturing facilities and those of its contract manufacturers and other suppliers. | |
| ● | Qianzhi’s facilities and operations may require continuous and substantial investment and upgrading. | |
| ● | Qianzhi has a limited operating history and its ability to successfully commercialize products of high quality and appeal to customers at scale is unproven and still evolving. | |
| ● | Qianzhi may experience net losses and may not sustain profitability in the future. | |
| ● | Qianzhi relies on third-party suppliers and distributors for many of the materials utilized in its products and they may not continue to produce products or provide services that are consistent with its standards or applicable regulatory requirements, which could harm Qianzhi’s brand, cause consumer dissatisfaction, and require it to find alternative suppliers of its products. | |
| ● | Qianzhi’s success depends on the continuing efforts of its senior management team and other key employees. | |
| ● | If Qianzhi fails to maintain an effective system of internal control over financial reporting, it may be unable to accurately report financial results or prevent fraud, and investor confidence in Qianzhi and the market price of its securities may be adversely affected. | |
| ● | Failure or security breach of Qianzhi’s information technology systems may disrupt its operations. |
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| ● | Certain regulatory actions call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the Public Company Accounting Oversight Board. These developments could add uncertainties to Qianzhi’s operations. | |
| ● | Forecasts and projections of Qianzhi’s operating and financial results relies in large part upon assumptions and analyses developed by its management. If these assumptions or analyses prove to be incorrect, Qianzhi’s actual operating results may be materially different from those forecasted or projected. | |
| ● | Qianzhi’s business plans require a significant amount of capital. In addition, Qianzhi’s future capital needs may require it to obtain additional equity or debt financing that may dilute shareholders or introduce covenants that may restrict its operations or its ability to pay dividends. | |
| ● | Qianzhi’s future growth is dependent on the demand for, and upon consumers’ willingness to adopt personal hygiene products and disinfectants, which is associated with consumers’ demand for personal hygiene products and disinfectants, and adoption of new personal hygiene products and disinfectants. |
Risks Relating to Doing Business in the People’s Republic of China (“PRC”)
| ● | Failure to meet the PRC government’s complex regulatory requirements on and significant oversight over Qianzhi’s business operation could result in a material adverse change in its operations and the value of securities. | |
| ● | The approval of and filing with the China Securities Regulatory Commission (“CSRC”) or other PRC government authorities is required in connection with the business combination. However, Qianzhi cannot predict whether or when it will be able to obtain such approval or complete such filing, and even if it obtains such approval, it could be rescinded. Any failure to or delay in obtaining such approval or complying with such filing requirements in relation to offering, or a rescission of such approval, could subject Qianzhi to sanctions imposed by the CSRC or other PRC government authorities. | |
| ● | Additional regulations under the PRC Law Relating to Data Security and Confidentiality and Archives Management may subject Qianzhi to additional compliance requirements in the future. | |
| ● | PRC regulations of loans and direct investment by offshore holding companies to PRC entities may delay or prevent Qianzhi from using the proceeds of its offshore financing to make loans or additional capital contributions to its PRC subsidiary, which could materially and adversely affect Qianzhi’s liquidity and its ability to fund and expand its business. | |
| ● | Chinese regulatory authorities could disallow Qianzhi’s holding company structure, which may result in a material change in its operations and/or a material change in the value of the combined company’s securities, including that it could cause the value of such securities to significantly decline. | |
| ● | Qianzhi may be materially adversely affected if its shareholders and beneficial owners who are PRC entities fail to comply with the PRC overseas investment regulations. | |
| ● | Qianzhi relies on dividends and other distributions on equity paid by its PRC subsidiaries to fund any cash and financing requirements it may have, and any limitation on the ability of Qianzhi’s PRC subsidiaries to make payments to Qianzhi could have a material and adverse effect on its ability to conduct business. |
Risks Relating to Intellectual Property, Information Technology and Legal Proceedings
| ● | Qianzhi may be subject to intellectual property infringement claims, which may be expensive to defend and may disrupt its business and operations. | |
| ● | As Qianzhi’s patents may expire and may not be extended, its patent applications may not be granted, and its patent rights may be contested, circumvented, invalidated, or limited in scope, its patent rights may not protect it effectively. In particular, Qianzhi may not be able to prevent others from developing or exploiting competing technologies, which could materially and adversely affect its business, financial condition, and results of operations. | |
| ● | If Qianzhi’s trademarks and trade names are not adequately protected, then it may not be able to build name recognition in its markets of interest and its business may be adversely affected. |
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| ● | Qianzhi depends on information technology to conduct its business. Any significant disruptions to information technology systems or facilities, or those of third parties with which Qianzhi does business, such as disruptions caused by cyber-attacks, could adversely impact its business. | |
| ● | You may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in China against Qianzhi or its management based on foreign laws. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China. |
Risks Relating to Being a Public Company Following the Business Combination
| ● | A market for the combined company’s shares may not develop, which would adversely affect the liquidity and price of the combined company’s shares. | |
| ● | The issuance of additional shares in connection with financings, acquisitions, investments, equity incentive plans or otherwise will dilute all other shareholders. | |
| ● | The combined company may be unable to maintain the listing of its securities on the Nasdaq Global Market in the future. | |
| ● | You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because the Company is incorporated under the laws of the Cayman Islands, and will conduct its operations, and its directors and executive officers reside, outside of the United States. |
Risks Related to Bowen Before the Business Combination
| ● | Bowen’s officers and directors have interests in the business combination that are different from those of Public Shareholders. | |
| ● | Bowen may become involved in litigation, including securities class action litigation relating to the proposed business combination that may materially adversely affect it. |
For additional detail on these and other risks, see the section entitled “Risk Factors” in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 1C. CYBERSECURITY
To date, we have not experienced any cybersecurity attacks. However, any such attack could adversely affect our business. Further, a penetration of our systems or a third-party’s systems or other misappropriation or misuse of personal information could subject us to business, regulatory, litigation and reputation risk, which could have a negative effect on our business, financial condition and results of operations.
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ITEM 2. PROPERTY
Our current executive offices are located at 420 Lexington Avenue, Suite 2446, New York, New York 10170, and our telephone number is (203) 998-5540. Pursuant to an Administrative Services Agreement, until the completion of our initial Business Combination or liquidation, we will pay a monthly fee of $10,000 to Bowen Holding LP for office space, secretarial and administrative services. We consider our current office space, combined with the other office space otherwise available to our executive officers, adequate for our current operations.
If the Business Combination with Qianzhi is consummated, the Company will likely utilize the principal administrative office of Qianzhi which is located at 17 Floor, Tower B, Jingji 100, Luohu District, Shenzhen City, covering an area of approximately 700m2 with a lease term from May 2023 to September 2026. For additional information on Qianzhi’s facilities, see the section entitled “Information about NewCo and Qianzhi – Facilities” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
ITEM 3. LEGAL PROCEEDINGS
There is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team in their capacity as such.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our Ordinary Shares, Rights and units are listed on the Nasdaq Stock Market LLC under the symbols “BOWN”, “BOWNR and” “BOWNU,” respectively.
Holders
As of December 31, 2024, there were 3 holders of record of our units, 6 holders of record of our Ordinary Shares and 1 holder of record of our Rights.
Dividends
We have not paid any cash dividends on our Ordinary Shares to date and do not intend to pay cash dividends prior to the completion of our initial business combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of our initial business combination. The payment of any cash dividends subsequent to our initial business combination will be within the discretion of our board of directors at such time and we will only pay such dividend out of our profits or share premium (subject to solvency requirements) as permitted under Cayman Islands law. Further, if we incur any indebtedness in connection with our initial Business Combination, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.
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Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities
On February 27, 2023, Bowen Holding LP acquired an aggregate of 1,725,000 Founder Shares for an aggregate purchase price of $25,000. Bowen Holding LP thereafter transferred an aggregate of 1,155,750 Founder Shares to Createcharm Holdings Ltd, our other Sponsor. The Company also issued to EarlyBirdCapital 180,000 EBC Founder Shares for an aggregate purchase price of $2,520 on March 15, 2023. The issuance of the foregoing securities was exempt pursuant to Section 4(a)(2) of the Securities Act.
On July 14, 2023, the Company consummated the Initial Public Offering of 6,000,000 Units. Each Unit consists of one Ordinary Share of the Company and one Right, each Right entitling the holder thereof to receive one-tenth of one Ordinary Share upon the completion of the Company’s initial business combination. The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $60,000,000. EarlyBirdCapital acted as sole book-running manager of the Initial Public Offering and Revere Securities acted as co-manager of the Initial Public Offering. The securities in the offering were registered under the Securities Act on a registration statement on Form S-1 (No. 333-272076). The Securities and Exchange Commission declared the registration statement effective on July 11, 2023.
Simultaneously with the consummation of the Initial Public Offering, the Company consummated the Private Placement of 330,000 Private Placement Units at a price of $10.00 per Private Placement Unit, generating total proceeds of $3,300,000. The Private Placement Units were purchased by Createcharm Holdings Ltd and EarlyBirdCapital. The Private Placement Units are identical to the Public Units sold in the Initial Public Offering. The purchasers of the Private Placement Units have agreed not to transfer, assign or sell any of the Private Placement Units or underlying securities (except to certain transferees) until after the completion of the Company’s initial business combination. The issuance was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
On July 17, 2023, the underwriters exercised their over-allotment option in full to purchase an additional 900,000 Units. As a result, on July 18, 2023, the Company sold an additional 900,000 Units at $10.00 per Unit, generating gross proceeds of $9,000,000. In connection with this sale, Createcharm Holdings Ltd and EarlyBirdCapital also purchased an additional 31,500 Private Placement Units from the Company, generating gross proceeds of $315,000. The issuance of the additional Private Placement Units was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
As of July 18, 2023, an aggregate of $69,690,000 was deposited in the Trust Account established with Continental Stock Transfer & Trust Company acting as trustee in connection with the Initial Public Offering.
We paid a total of $1,725,000 in underwriting discounts and commissions related to the Initial Public Offering.
On January 10, 2025, the Company held an extraordinary general meeting to approve a proposal to extend the time the Company had to consummate its initial business combination to up to April 14, 2025. In connection with the meeting, an aggregate of 6,052,095 Public Shares were redeemed at a price of approximately $10.99 per share. On April 14, 2025, the Company held another extraordinary general meeting to approve a proposal to extend the time the Company had to consummate its initial business combination to up to July 14, 2025. In connection with the meeting, an aggregate of 103,432 Public Shares were redeemed at a price of approximately $11.03 per share. As a result, approximately $8,211,537 remained in the Trust Account (without taking into account any Public Shares submitted for redemption in connection with the vote taken to approve the Business Combination with Qianzhi).
ITEM 6. [RESERVED]
Not applicable.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related thereto which are included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Cautionary Note Regarding Forward-Looking Statements,” “Item 1A. Risk Factors” and elsewhere in this Annual Report.
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Overview
We are a blank check company incorporated on February 17, 2023 as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. While we intend to focus our search on businesses in Asia, we are not limited to a particular industry or geographic region for purposes of consummating an initial business combination. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private units, promissory loans with target or related parties, the proceeds of the sale of our securities in connection with our initial business combination, our shares, debt or a combination of cash, stock and debt.
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception through December 31, 2024 were organizational activities, those necessary to prepare for the IPO described below, and since the closing of the IPO, identifying a target company for our initial Business Combination, and professional costs related with the initial Business Combination. We do not expect to generate any operating revenues until after the completion of our initial Business Combination. We generated non-operating income in the form of interest income on marketable securities held after the IPO. We expect that we will 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 in connection with searching for, and completing, a Business Combination.
For the year ended December 31, 2024, we had a net income of $2,963,852, which consists of a loss of $633,764 derived from operating costs, and interest expense of $87,267, offset by income earned on the Trust Account of $3,684,883.
For the period from February 17, 2023 (inception) through the year ended December 31, 2023, we had a net income of $1,484,790, which consists of a loss of $244,568 derived from formation and operating costs offset by income earned on the Trust Account of $1,729,358.
Liquidity, Capital Resources and Going Concern
On July 14, 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 our IPO, we consummated the sale of 330,000 Private Placement Units at a price of $10.00 per Private Placement Unit in a private placement to the Sponsors, generating total gross proceeds of $3,300,000.
On July 17, 2023, the underwriters exercised the over-allotment option in full to purchase 900,000 Units. As a result, on July 18, 2023, we sold an additional 900,000 Units at $10.00 per Unit, generating gross proceeds of $9,000,000. Simultaneously with the closing of the full exercise of the over-allotment option, we completed the private sale of an aggregate of 31,500 Private Placement Units, at a purchase price of $10.00 per Private Placement Unit, generating gross proceeds of $315,000. Transaction costs amounted to $3,318,898 consisting of $1,725,000 of cash underwriting fees and $1,593,898 of other offering costs.
Following the closing of the IPO and the sale of over-allotment units, an amount of $69,690,000 ($10.10 per Unit) from the net proceeds of the sale of the Units in the IPO and the Private Placement was placed 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. We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account, to complete our initial business combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our initial business combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
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As of December 31, 2024, we had cash and cash equivalent of $103,774. We will use these funds primarily to complete the business combination. This includes conducting ongoing due diligence, obtaining necessary regulatory and shareholder approvals, preparing required filings and disclosures, structuring and negotiating transaction terms, and covering costs related to legal, financial, and other advisory services. Additionally, funds may be used to pay taxes to the extent the interest earned on the trust account is not sufficient to pay our taxes.
We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination, in which case we may issue additional securities or incur debt in connection with such business combination.
As of December 31, 2024, we had cash and cash equivalent of $103,774 and a working capital deficit of $799,056. We have incurred and expect to continue to incur significant professional costs to remain as a public traded company and to incur transaction costs in pursuit of a Business Combination. In connection with our assessment of going concern considerations in accordance with Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” we believe that these conditions raise substantial doubt about our ability to continue as a going concern. In addition, if we are unable to complete a Business Combination within the Combination Period and such period is not extended, there will be a liquidation and subsequent dissolution. As a result, we have determined that such additional condition also raises substantial doubt about our ability to continue as a going concern. Management expects to obtain additional funds from related parties to provide the additional working capital necessary to carry out its objective to consummate a business combination. The consolidated financial statements do not include any adjustments that might result from the outcome of the uncertainty.
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2024. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Related Party Transactions
Please refer to Financial Statement Note 5 - Related Parties.
Other Contractual Obligations
We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities reflected on our balance sheet.
Registration Rights
The holders of the Founder Shares, EBC founder shares, Private Placement Units will be entitled to registration rights pursuant to a registration rights agreement dated July 11, 2023 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.
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Business Combination Marketing Agreement
We have engaged EBC as an advisor in connection with its Business Combination to assist in holding meetings with the Company stockholders to discuss the potential Business Combination and the target business’ attributes, introduce the Company to potential investors that are interested in purchasing its securities in connection with its initial Business Combination and assist with press releases and public filings in connection with the Business Combination. The Company will pay EBC a service fee for such services upon the consummation of its initial Business Combination in an amount equal to 3.5% of the gross proceeds of the IPO. In addition, the Company will pay EBC a service fee in an amount equal to 1.0% of the total consideration payable in the initial Business Combination if it introduces the Company to the target business with whom it completes an initial Business Combination and the amount will be payable in cash and is due at the closing date of the initial Business Combination.
Critical Accounting Policies and Estimates
The preparation of consolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. 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 as of the date of the financial statements, and that management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results may differ from these estimates. Management does not believe that we have any critical accounting estimates; however, we have identified the following critical accounting policy:
Net Income (Loss) per Share
The Company complies with accounting and disclosure requirements of FASB ASC 260, Earnings 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 interest income and unrealized gain or loss on investments in trust account less any dividends paid. We 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 ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders.
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 our consolidated financial statements.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not required for smaller reporting companies.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
This information appears following Item 15 of this Report and is included herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective, due solely 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. generally accepted accounting principles. Accordingly, management believes that the consolidated financial statements included in this Form 10-K present fairly in all material respects our financial position, results of operations and cash flows for the period 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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Management’s Report on Internal Controls Over Financial Reporting
Our management is responsible for establishing and maintaining an adequate system of internal control over financial reporting, as such term is defined in Exchange Act Rules 13(a)-15(f). Our system of internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the U.S.
Our internal control over financial reporting includes those policies and procedures that:
| ● | pertain to the maintenance of records, in reasonable detail, accurately and fairly reflect our transactions and dispositions of our assets; | |
| ● | provide reasonable assurance our transactions are recorded as necessary to permit preparation of our financial statements in accordance with accounting principles generally accepted in the U.S., and our receipts and expenditures are being made only in accordance with authorizations of our management and our directors; and | |
| ● | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets could have a material effect on the financial statements |
Due to its inherent limitations, a system of internal control over financial reporting can provide only reasonable assurance and may not prevent or detect all misstatements. Further, because of changes in conditions, effectiveness of internal controls over financial reporting may vary over time. Our system contains self-monitoring mechanisms, so actions will be taken to correct deficiencies as they are identified.
Our management conducted an evaluation of the effectiveness of the system of internal control over financial reporting based on the framework in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management concluded that our disclosure controls and procedures were not effective, due solely 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. generally accepted accounting principles. Accordingly, management believes that the consolidated financial statements included in this Form 10-K present fairly in all material respects our financial position, results of operations and cash flows for the period 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.
This Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC to permit us to provide only management’s report in this Form 10-K.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
During
the quarter ended December 31, 2024, no director or officer
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ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
If the Company consummates the Transactions, the officers and directors of the Company will be as follows:
| Name | Age | Position | |||
| Executive Officers | |||||
| Dajun Wang | 59 | Chief Executive Officer and Director | |||
| Liangwen Wang | 37 | Chief Financial Officer | |||
| Directors | |||||
| Dajun Wang | 59 | Director | |||
| Wei Liang | 46 | Director | |||
| Wen He | 57 | Independent Director | |||
| Zhenning He | 28 | Independent Director | |||
| Jun Zhang | 61 | Independent Director | |||
The biographies of the above-identified individuals and other information relating to the officers and directors of the combined company (including the committees of the board) are set forth in the section titled “Directors and Executive Officers of New Bowen after the Business Combination” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
If the Company is unable to consummate the Transactions for whatever reason, the Company’s officers and directors will not change. Our current directors and executive officers are as follows:
| Name | Age | Position | ||
| Na Gai | 38 | Chairwoman of the Board of Directors | ||
| Jiangang Luo | 56 | Chief Executive Officer | ||
| Jing Lu | 60 | Chief Financial Officer | ||
| Lawrence Leighton | 90 | Independent Director | ||
| Wei Li | 46 | Independent Director | ||
| June Zhang | 61 | Independent Director |
Na Gai, our Chairwoman, has served as the executive president for Shenzhen Guoxing Capital Co., Ltd., an asset management and investment company based in China, since September 2015. Ms. Gai also served as a partner of Hunan Zhongsheng Hongcheng Investment Management Partnership (LP), a private equity investment company based in China, from February to May 2017. Since October 2021, she has also served as an independent director for Flag Ship Acquisition Corp., a blank check company like our company that is seeking to consummate its Initial Public Offering. Ms. Gai received a bachelor degree of Business Administration from The Open University of China and an accounting diploma from Changsha University of Science & Technology. Ms. Gai was also certified as AFP Financial planner in August 2017. Ms. Gai is a Chinese citizen. We believe Ms. Gai is well-qualified to serve as a member of our board of directors due to her experience, contacts and relationships.
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Jiangang Luo, our Chief Executive Officer, has been the manager of Cleantech Global Limited, an investment consulting firm, since 2014, and the president of Prime Science & Technology, Inc., a computer/software consulting and IT outsourcing company, since 2006. Since 2021, he has also been the president of PNE Limited Partner LLC and Luo & Long General Partner LLC, which are special purpose vehicles that were established for the sole purpose of investing in Princeton NuEnergy, a US based cleantech company. From 2011 to 2016, he served as managing partner of Faith Asset Management LLC, a global investment firm focused on the clean energy sector. From 2000 to 2006, he worked for Oracle as a Principal Consultant. Before 2000, he worked as a senior information system professional in various Fortune 500 companies including China Resources Group and Liz Claiborne. Mr. Luo also served as an executive for many non-profit organizations such as Chairman of the Tsinghua Alumni Association in New York and President of New Jersey Chinese Computer Professionals Society. Mr. Luo is a member of Tsinghua Entrepreneur & Elite Club. He has invested in many cleantech/fintech companies over the last 10 years. Mr. Luo received degrees in Applied Mathematics and Computer Science from Tsinghua University, a Computer Science Masters degree from New Jersey Institute of Technology and a masters degree in Computational Mathematics from Tsinghua University. Mr. Luo is a US citizen.
Dr. Jing Lu, our Chief Financial Officer, has more than 20 years of experience in the financial service industry. Dr. Lu has served as a Managing Director and then Chief Operating Officer of China Bridge Capital International Inc., a PE/VC investment advisory company specialized in innovative technologies from 2017 to 2019 and from March 2021 to January 2022. She has also served as Chief Financial Officer of Keyarch Acquisition Corporation, a blank check company similar to our company, since March 2021. She also served as Chief Investment Officer for the New Hope Fertility Center (NHFC) from 2019 to 2021, sourcing and managing PE investments, bank loans and government PPP loans. Prior to China Bridge Capital, Dr. Lu was President of ACE AV Consulting Inc. from 2005 to 2017. Dr. Lu was an Executive Director at CIBC World Markets in 2001 working on corporate securities. Between 1998 and 2001, Dr. Lu worked at the Federal Reserve Bank of New York as a bank regulator and supervisor, working on Basel Capital Accords as well as examining banks’ implementation of the Basel Accords. Before moving to New York, Dr. Lu was a professor of economics at York University in Canada for four years, specializing her teaching and research in Macroeconomics, Institutional Economics, and Econometrics. Dr. Lu received a Ph.D. and M.A. in Economics from Western University in Canada, a Graduate Certificate in Economics from the People’s University in China, and a B.A in World Economy from Fudan University in China. Dr. Lu is a U.S. citizen and resident of the State of New York.
Lawrence Leighton, one of our director nominees, is a seasoned international investment banker with approximately 50 years of experience. He has worked with many major international companies throughout his career, including Pernod Ricard SA (ENXTPA: RI) and Verizon Communications Inc. (NYSE: VZ). Mr. Leighton has served as a Managing Director of Bentley Associates, a boutique investment bank, since 1997. In 1989, he became President and Chief Executive Officer of UI USA, the US subsidiary of Union d’Ètudes et d’Investissements, the merchant banking arm of Credit Agricôle, the largest bank in France. From 1982 to 1989, Mr. Leighton served as a Managing Director of Chase Bank. Previously, he was a Limited Partner at Bear, Stearns & Co., focusing on international mergers and acquisitions. Starting in 1974, he was with Norton Simon as the Director of Strategic Planning/Mergers & Acquisitions. Before Norton Simon, Mr. Leighton was with Clark, Dodge & Co. where he became Co-Head of the Corporate Finance Department. He has been a member of the board of directors of Bon Natural Life Limited, a natural products and ingredients business, since June 2021. Mr. Leighton received a B.S.E. degree from Princeton University and an M.B.A. from Harvard Business School. Mr. Leighton is a U.S. Citizen. We believe Mr. Leighton is well-qualified to serve as a member of our board of directors due to his experience, contacts and relationships.
Wei Li, one of our director nominees, has five years of Wall Street experience at 1st-tier financial institutions including Barclays Capital and HSBC. Ms. Li is the co-founder and has served as CEO of Hyatt Capital Management, a private investment fund and financial service company dedicated in impact investing in the Asian pacific area, since 2018. Previously, Ms. Li served as Managing Director and Head of Structured Finance at China Renaissance (HK.1911), a leading boutique investment bank in Hong Kong, Shanghai and Beijing (where she was based during her time there), from 2016 to 2018. She was Executive Director & Head of Private Credit Investment at CITIC Securities (SH.600030), an investment bank, from 2011 to 2016. Ms. Li received a M. Phil degree in Land Economy from University of Cambridge and is a Ph.D candidate from University of Rochester. Ms. Li is a CFA charter-holder. We believe Ms. Li is well-qualified to serve as a member of our board of directors due to her experience, contacts and relationships
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Jun Zhang, one of our director nominees, has served as Senior Partner and Associate Director at Mazars (Shenzhen Branch) since 2000. Mr. Zhang also founded Shenzhen Zhonghuan Certified Public Accountants Co., Ltd, an accounting firm, in 2009 and has served as Chairman since its founding. From 1994 to 2000, he served as Partner and Associate Director at Shenzhen Wenwu Accounting Firm. From 1989 to 1994, he was the Senior Manager at Shenzhen Shekou Zhonghua Accounting Firm. He served as Project Manager at Wuhan Accounting Firm of Wuhan Finance Bureau from 1986 to 1989. Mr. Zhang received a Master’s degree in Management from Zhongnan University of Economics and Law and Bachelor’s degree in Financial Accounting from Jianghan University. He is a CPA in China. Mr. Zhang is a Chinese citizen. We believe Mr. Zhang is well-qualified to serve as a member of our board of directors due to his experience, contacts and relationships.
Number and terms of office of officers and directors
Our board of directors is divided into three classes with only one class of directors being elected in each year and each class (except for those directors appointed prior to our first annual meeting of shareholders) serving a three-year term. The term of office of the first class of directors, consisting of Wei Li, will expire at our first annual meeting of shareholders. The term of office of the second class of directors, consisting of Lawrence Leighton, will expire at the second annual meeting of shareholders. The term of office of the third class of directors, consisting of Na Gai and Jun Zhang, will expire at the third annual meeting of shareholders.
Our officers are appointed by the board of directors and serve at the discretion of the board of directors, rather than for specific terms of office. Our board of directors is authorized to appoint such officers as it deems appropriate pursuant to our amended and restated memorandum and articles of association.
Director Independence
Nasdaq listing standards require that a majority of our board of directors be independent, subject to certain phase-in provisions. An “independent director” is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship which in the opinion of the company’s board of directors, would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director. Our board of directors has determined that each of Lawrence Leighton, Wei Li and Jun Zhang are “independent directors” as defined in the Nasdaq listing standards and applicable SEC rules. Our independent directors have regularly scheduled meetings at which only independent directors are present.
Audit Committee
Effective July 11, 2023, we formed an audit committee. Lawrence Leighton, Wei Li and Jun Zhang serve as members of our audit committee, with Jun Zhang serving as the Chairman of the audit committee. Under Nasdaq listing standards and applicable SEC rules, we are required to have at least three members of the audit committee, all of whom must be independent, subject to certain phase-in provisions. Each such person meets the independent director standard under Nasdaq listing standards and under Rule 10-A-3(b)(1) of the Exchange Act.
Each member of the audit committee is financially literate and our board of directors has determined that Jun Zhang qualifies as an “audit committee financial expert” as defined in applicable SEC rules.
We have adopted an audit committee charter, which details the principal functions of the audit committee, including:
| ● | the appointment, compensation, retention, replacement, and oversight of the work of the independent auditors and any other independent registered public accounting firm engaged by us; | |
| ● | pre-approving all audit and permitted non-audit services to be provided by the independent auditors or any other registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; | |
| ● | reviewing and discussing with the independent auditors all relationships the auditors have with us in order to evaluate their continued independence; |
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| ● | setting clear hiring policies for employees or former employees of the independent auditors; | |
| ● | setting clear policies for audit partner rotation in compliance with applicable laws and regulations; | |
| ● | obtaining and reviewing a report, at least annually, from the independent auditors describing (i) the independent auditor’s internal quality-control procedures and (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues; | |
| ● | reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and | |
| ● | reviewing with management, the independent auditors, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our consolidated financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities. |
Compensation Committee
Effective July 11, 2023, we established a compensation committee of the board of directors. Under the Nasdaq listing standards and applicable SEC rules, we are required to have at least two members of the compensation committee, all of whom must be independent, subject to certain phase-in provisions. Lawrence Leighton, Wei Li and Jun Zhang serve as members of our compensation committee, with Lawrence Leighton serving as the chairman of the compensation committee. Each such person meets the independent director standard under Nasdaq listing standards applicable to members of the compensation committee.
We have adopted a compensation committee charter, which details the principal functions of the compensation committee, including:
| ● | reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; | |
| ● | reviewing and approving on an annual basis the compensation of all of our other officers; | |
| ● | reviewing on an annual basis our executive compensation policies and plans; |
| ● | implementing and administering our incentive compensation equity-based remuneration plans; | |
| ● | assisting management in complying with our proxy statement and annual report disclosure requirements; | |
| ● | approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; | |
| ● | if required, producing a report on executive compensation to be included in our annual proxy statement; and | |
| ● | reviewing, evaluating, and recommending changes, if appropriate, to the remuneration for directors. |
Notwithstanding the foregoing, other than reimbursement of expenses, no compensation of any kind, including finders, consulting or other similar fees, will be paid to any of our existing shareholders, officers, directors or any of their respective affiliates, prior to, or for any services they render in order to complete the consummation of a business combination although we may consider cash or other compensation to officers or advisors we may hire to be paid either prior to or in connection with our initial business combination. Accordingly, it is likely that prior to the consummation of an initial business combination, the compensation committee will only be responsible for the review and recommendation of any compensation arrangements to be entered into in connection with such initial business combination.
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The charter also provides that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee will consider the independence of each such adviser, including the factors required by Nasdaq and the SEC.
Director Nominations
We do not have a standing nominating committee. In accordance with Rule 5605(e)(2) of the Nasdaq Rules, a majority of the independent directors may recommend a director nominee for selection by the board of directors. The board of directors believes that the independent directors can satisfactorily carry out the responsibility of properly selecting or approving director nominees without the formation of a standing nominating committee. As there is no standing nominating committee, we do not have a nominating committee charter in place.
The board of directors will also consider director candidates recommended for nomination by our shareholders during such times as they are seeking proposed nominees to stand for election at the next annual meeting of shareholders (or, if applicable, a special meeting of shareholders). Our shareholders that wish to nominate a director for election to our board of directors should follow the procedures set forth in our amended and restated memorandum and articles of association.
We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating nominees for director, our board of directors considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our shareholders.
Code of Ethics
Effective July 11, 2023, we adopted a code of ethics that applies to all of our executive officers, directors, and employees. The code of ethics codifies the business and ethical principles that govern all aspects of our business.
Insider Trading Policy
We have an insider trading policy governing the purchase, sale, and other dispositions of our securities that applies to our directors, officers, employees, and consultants. The policy generally prohibits the purchase, sale or trade of our securities with the knowledge of material nonpublic information. We believe our insider trading policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to our company.
ITEM 11. EXECUTIVE COMPENSATION
Executive Compensation
No executive officer has received any cash compensation for services rendered to us. Commencing July 11, 2023, through the acquisition of a target business, we pay Bowen Holding LP an aggregate fee of $10,000 per month for providing us with office space and certain office and secretarial services. Additionally, on February 20, 2023, we engaged TenX Global Capital, a member of Bowen Holding LP, to provide us with consulting and advisory services in connection with, among other things, assisting us with the preparation of, and the accounting relating to, our quarterly and annual reports to be filed with the Securities and Exchange Commission at a price of $5,250 per quarter. However, these arrangements are solely for our benefit and are not intended to provide our officers or directors compensation in lieu of a salary.
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Other than the foregoing fees and the repayment of loans that may be made by our Sponsors, officers, directors or their affiliates to us, no compensation or fees of any kind, including finder’s fees, consulting fees or other similar fees, will be paid to our initial stockholders, special advisors, members of our management team or their respective affiliates, for services rendered prior to or in connection with the consummation of our initial business combination (regardless of the type of transaction that it is). However, they will receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses, performing business due diligence on suitable target businesses and business combinations as well as traveling to and from the offices, plants or similar locations of prospective target businesses to examine their operations. There is no limit on the amount of out-of-pocket expenses reimbursable by us.
For information relating to executive compensation assuming we consummate the Transactions, see the section titled “Executive Officer and Director Compensation” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
Since our formation, we have not granted any stock options or stock appreciation rights or any other awards under long-term incentive plans to any of our executive officers or directors. In connection with the Transactions, in January 2025, the Company’s shareholders approved an incentive equity plan. For information relating to grants that may be made after consummation of the Transactions, see the section titled “Proposal 7: The Incentive Plan Proposal” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
The following table sets forth information regarding the beneficial ownership of our Ordinary Shares as of the date of this Annual Report by:
| ● | each person known by us to be the beneficial owner of more than 5% of our outstanding Ordinary Shares; | |
| ● | each of our officers and directors; and | |
| ● | all of our officers and directors as a group. |
Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all shares beneficially owned by them. The following table does not reflect record of beneficial ownership of the Rights included in the units offered in the Initial Public Offering or the Private Placement Units as these Rights may not be convertible within 60 days of the date hereof. The following also does not take into account the redemption of public shares held by any holder not affiliated with our Sponsors, officers and directors that owned more than 5% of our outstanding ordinary shares.
| Name and address of beneficial owner(1) | Amount and nature of beneficial ownership | Approximate percentage of outstanding ordinary shares | ||||||
| Createcharm Holdings Ltd (2) (7) | 1,497,532 | 49.7 | % | |||||
| Bowen Holding LP (3) (7) | 569,250 | 18.9 | % | |||||
| Na Gai(4) | * | * | ||||||
| Jiangang Luo(4) | * | * | ||||||
| Jing Lu (4) | * | * | ||||||
| Lawrence Leighton (4) | * | * | ||||||
| Wei Li(4) | * | * | ||||||
| Jun Zhang (4) | * | * | ||||||
| EarlyBirdCapital, Inc. (7) | 199,718 | 6.6 | % | |||||
| All officers and directors as a group (six individuals)(4) | 0 | 0 | % | |||||
| First Trust Merger Arbitrage Fund(5) | 656,000 | 21.8 | % | |||||
| AQR Capital Management, LLC(6) | 483,000 | 16.0 | % | |||||
| 17 |
| * | Less than one percent. |
| (1) | Unless otherwise noted, the business address of each of the following entities or individuals is c/o Bowen Acquisition Corp, 420 Lexington Avenue, Room 2446, New York NY 10170. |
| (2) | Createcharm Holdings Ltd is the record holder of the Founder Shares reported herein. Na Gai is the sole director and shareholder of Createcharm Holdings Ltd. Accordingly, she may be deemed to be the beneficial owner of such shares. Ms. Gai disclaims beneficial ownership of the shares owned by Createcharm Holdings Ltd. except to the extent of her ultimate pecuniary interest therein. |
| (3) | Bowen Holding LP is the record holder of the Founder Shares reported herein. Bowen Management LLC is the managing member of Bowen Holding LP and Dahe Zhang is the manager of Bowen Management LLC. Accordingly, Dahe Zhang is deemed to be the beneficial owner of such shares. Mr. Zhang disclaims beneficial ownership of the shares owned by Bowen Holding LP except to the extent of his ultimate pecuniary interest therein. |
| (4) | Does not include any shares that may be indirectly owned by (i) Jiangang Luo, Jing Lu, Lawrence Leighton, Wei Li and Jun Zhang, as a result of each such person holding a partnership interest in Bowen Holding LP, and (ii) Na Gai as a result of her being the sole director and shareholder of Createcharm Holdings Ltd. |
| (5) | The address for First Trust Merger Arbitrage Fund is 235 West Galena Street, Milwaukee, WI 53212 (“VARBX”). Based on a Schedule 13G filed jointly by VARBX, First Trust Capital Management L.P., First Trust Capital Solutions L.P. and FTCS Sub GP LLC on November 14, 2024. |
| (6) | The address for AQR Capital Management, LLC is One Greenwich Plaza, Greenwich, CT 06830, based on a Schedule 13G filed jointly by AQR Capital Management, LLC, AQR Capital Management Holdings, LLC and AQR Arbitrage, LLC on November 14, 2024. |
| (7) | On October 14, 2024, one of the Sponsors transferred 30,000 of its Founder Shares to EarlyBirdCapital in connection with the loans. The transfer is yet to be finalized as of the date of this Annual Report. |
Our Sponsors and their controlling individuals and our executive officers are deemed to be our “promoters” as such term is defined under the federal securities laws.
Restrictions on Transfers of Founder Shares, EBC Founder Shares, and Private Units
Following the consummation of our Initial Public Offering, the Founder Shares were placed into an escrow account maintained by Continental Stock Transfer & Trust Company acting as escrow agent. The Founder Shares will not be transferred, assigned, sold or released from escrow until six months after the date of the consummation of our initial business combination, or earlier, if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their shares for cash, securities or other property, except (a) to our Sponsors, officers, directors, any affiliates or family members of any of our Sponsors, officers or directors or any members of our initial shareholders, or any affiliate of our initial shareholders; (b) in the case of an individual, by gift to a member of the individual’s immediate family, to a trust, the beneficiary of which is a member of the individual’s immediate family or an affiliate of such person, or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with the consummation of a business combination at prices no greater than the price at which the securities were originally purchased; (f) by virtue of the laws of the Cayman Islands or the organizational documents of our Sponsors upon their dissolution; or (g) to us for no value for cancellation in connection with the consummation of our initial business combination; provided, however, that in the case of clauses (a) through (f) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreements unless we otherwise consent to a transfer without a continuation of such restrictions.
| 18 |
Our Sponsors and EBC have purchased from us an aggregate of 361,500 Private Placement Units in a private placement that closed simultaneously with the closing of our Initial Public Offering and related over-allotment option. The Private Placement Units are identical to the units sold in our Initial Public Offering, subject to limited exceptions. Our Sponsors and EBC have agreed not to transfer, assign or sell any of the Private Placement Units or underlying securities (except to the same permitted transferees as the Founder Shares and provided the transferees agree to the same terms and restrictions as the permitted transferees of the Founder Shares must agree to, each as described herein) until the completion of our initial Business Combination.
The Company also issued 180,000 EBC Founder Shares to EarlyBirdCapital for an aggregate purchase price of $2,520 on March 15, 2023. The EBC Founder Shares may not be transferred, assigned or sold (except to the same permitted transferees as the Founder Shares and provided the transferees agree to the same terms and restrictions as the permitted transferees of the Founder Shares must agree to, each as described herein) until the consummation of an initial Business Combination.
Registration Rights
The holders of the Founder Shares, EBC Founder Shares, Private Placement Units, Working Capital Units (if any) and their underlying securities will be entitled to registration rights pursuant to a registration rights agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities for resale. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our completion of our initial business combination and rights to require us to register for resale such securities pursuant to Rule 415 under the Securities Act. We will bear the expenses incurred in connection with the filing of any such registration statements.
In compliance with FINRA Rule 5110(f)(2)(G), the registration rights granted to EBC are limited to demand and “piggy back” rights for periods of five and seven years, respectively, from the effective date of our prospectus filed in connection with our Initial Public Offering and EBC may only exercise its demand rights on one occasion.
Equity Compensation Plans
As of December 31, 2024, we had no compensation plans (including individual compensation arrangements) under which equity securities of the registrant were authorized for issuance. In connection with the Transactions, in January 2025, the Company’s shareholders approved an incentive equity plan. For information relating to such plan, see the section titled “Proposal 7: The Incentive Plan Proposal” contained in the Definitive Proxy Statement/Prospectus, incorporated by reference herein.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
On February 27, 2023, Bowen Holdings LP acquired an aggregate of 1,725,000 Founder Shares for an aggregate purchase price of $25,000. Thereafter, it transferred an aggregate of 1,155,750 Founder Shares to Createcharm Holdings Ltd. On October 14, 2024, one of the Sponsors transferred 30,000 of its Founder Shares to EarlyBirdCapital in connection with the loans.
Our Sponsors purchased an aggregate of 361,500 Private Placement Units in the Private Placement that was consummated concurrently with the IPO, including those Private Placement Units purchased following the full exercise of the underwriters’ over-allotment option, for a purchase price of $10.00 per Private Placement Unit, for an aggregate purchase price of $3,615,000. Each Private Placement Unit consists of one Private Placement Share and one Private Placement Right. The Private Placement Units (including the Private Placement Shares, Private Placement Rights, and the Ordinary Shares issuable upon conversion of the Private Placement Rights included in such Private Placement Units) and the Working Capital Units that may be issued upon conversion of working capital loans (including the Ordinary Shares, Rights, and Ordinary Shares issuable upon conversion of the Rights included in such Working Capital Units) may not, subject to certain limited exceptions, be transferred, assigned or sold by the holder.
| 19 |
Except as set forth herein, no compensation of any kind, including finder’s and consulting fees, will be paid to our initial shareholders, existing officers, directors and advisors, or any of their respective affiliates, for services rendered prior to or in connection with the completion of an initial business combination. However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made to our initial shareholders or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
Our Sponsors agreed to loan us up to $300,000 to be used for a portion of the expenses of our Initial Public Offering. These loans are non-interest bearing, unsecured and were due at the closing of our Initial Public Offering. The Promissory Note expired on July 14, 2023.
On July 11, 2023, Bowen Holding LP agreed that through the earlier of our consummation of our initial business combination or the liquidation of the Trust Account, it will make available to us certain general and administrative services, including office space, utilities and administrative support, as we may require from time to time. We have agreed to pay $10,000 per month for these services. We believe, based on rents and fees for similar services, that these fees are at least as favorable as we could have obtained from an unaffiliated person.
On February 20, 2023, we engaged TenX Global Capital, a member of Bowen Holding LP, to provide us with consulting and advisory services in connection with, among other things, (i) preparing certain of our consolidated financial statements and other financial-related disclosures at a fixed price of $20,000 and (ii) assisting us with the preparation of, and the accounting relating to, our quarterly and annual reports to be filed with the Securities and Exchange Commission at a price of $5,250 per quarter commencing on the month following the consummation of our Initial Public Offering.
In addition, in order to finance transaction costs in connection with an intended initial business combination, our initial shareholders, officers, directors or their affiliates may, but are not obligated to, loan us funds on a non-interest bearing basis as may be required. If we complete an initial business combination, we would repay such loaned amounts. In the event that the initial business combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from our Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into Working Capital Units at $10.00 per Working Capital Unit at the option of the lender. The Working Capital Units would be identical to the Private Placement Units. Except as set forth above, the terms of such loans have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our initial shareholders, officers, directors or their affiliates as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account, but if we do, we will request such lender to provide a waiver against any and all rights to seek access to funds in our Trust Account.
After our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company with any and all amounts being fully disclosed to stockholders, to the extent then known, in the proxy solicitation materials furnished to our stockholders. However, the amount of such compensation may not be known at the time of the stockholder meeting held to consider an initial business combination, as it will be up to the directors of the post-combination business to determine executive and director compensation. In this event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form 8-K or a periodic report, as required by the SEC.
Related Party Policy
Our Code of Ethics, which we adopted upon consummation of our Initial Public Offering, requires us to avoid, wherever possible, all related party transactions that could result in actual or potential conflicts of interests, except under guidelines approved by the board of directors (or the audit committee). Related-party transactions are defined as transactions in which (1) the aggregate amount involved will or may be expected to exceed $120,000 in any calendar year, (2) we or any of our subsidiaries is a participant, and (3) any (a) executive officer, director or nominee for election as a director, (b) greater than 5% beneficial owner of our Ordinary Shares, or (c) immediate family member, of the persons referred to in clauses (a) and (b), has or will have a direct or indirect material interest (other than solely as a result of being a director or a less than 10% beneficial owner of another entity). A conflict-of-interest situation can arise when a person takes actions or has interests that may make it difficult to perform his or her work objectively and effectively. Conflicts of interest may also arise if a person, or a member of his or her family, receives improper personal benefits as a result of his or her position.
| 20 |
We also require each of our directors and executive officers to annually complete a directors’ and officers’ questionnaire that elicits information about related party transactions.
Our audit committee, pursuant to its written charter, is responsible for reviewing and approving related-party transactions to the extent we enter into such transactions. All ongoing and future transactions between us and any of our officers and directors or their respective affiliates will be on terms believed by us to be no less favorable to us than are available from unaffiliated third parties. Such transactions will require prior approval by our audit committee and a majority of our uninterested “independent” directors, or the members of our board who do not have an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent legal counsel. We will not enter into any such transaction unless our audit committee and a majority of our disinterested “independent” directors determine that the terms of such transaction are no less favorable to us than those that would be available to us with respect to such a transaction from unaffiliated third parties. Additionally, we require each of our directors and executive officers to complete a directors’ and officers’ questionnaire that elicits information about related party transactions.
These procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer.
Director Independence
Currently, Lawrence Leighton, Wei Li and Jun Zhang would each be considered an “independent director” under the Nasdaq listing rules, which is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship, which, in the opinion of the company’s board of directors would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director. Our independent directors will have regularly scheduled meetings at which only independent directors are present.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
The following is a summary of fees paid or to be paid to UHY LLP, or UHY, for services rendered.
The firm of UHY LLP, or UHY, acts as our independent registered public accounting firm. The following is a summary of fees paid to UHY for services rendered.
Audit Fees. Audit fees consist of fees billed for professional services rendered for the audit of our year-end consolidated financial statements and interim review of the financial information included in our registration statement or Form 10-Q for the respective periods. The aggregate fees billed by UHY for professional services rendered for the audit of our annual financial statements, review of the financial information included in our Forms 10-Q for the respective periods and other required filings with the SEC for the year ended December 31, 2024 totaled $257,906. The fees rendered for the initial audit, post-IPO balance sheet audit, and for the review of our registration statements and other regulatory documents filed with SEC for the period from February 17, 2023 (inception) through December 31, 2023 totaled $156,351.
Audit-Related Fees. Audit-related services consist of fees billed for assurance and related services that are reasonably related to performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees.” These services include attest services that are not required by statute or regulation and consultations concerning financial accounting and reporting standards. We did not pay UHY for consultations concerning financial accounting and reporting standards for the year ended December 31, 2024 and for the period from February 17, 2023 (inception) through December 31, 2023.
All Other Fees. There were no fees billed for products and services provided by our independent registered public accounting firm other than those set forth above for the year ended December 31, 2024 and the period from February 17, 2023 (inception) through December 31, 2023.
Pre-Approval Policy
Our audit committee was formed in connection with the consummation of our Initial Public Offering. As a result, the audit committee did not pre-approve all of the foregoing services, although any services rendered prior to the formation of our audit committee were approved by our board of directors. Since the formation of our audit committee, and on a going-forward basis, the audit committee has and will pre-approve all auditing services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions for non-audit services described in the Exchange Act which are approved by the audit committee prior to the completion of the audit).
| 21 |
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, AND SCHEDULES
| (a) | The following documents are filed as part of this report: |
| (1) | Financial Statements: |
| (2) | Financial Statement Schedules: |
None.
| (b) | The following Exhibits are filed as part of this report: |
| 22 |
| * | Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on July 11, 2023. |
| ** | Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on January 24, 2024. |
| *** | Incorporated by reference to the Registrant’s Current Report on Form 8-K filed on December 5, 2024 |
| **** | Incorporated by reference to the Registrant’s Registration Statement on Form S-1 (SEC File Nos. 333-272076). |
| ***** | Incorporated by reference to the Registrant’s Annual Report on Form 10-K filed on March 29, 2024. |
| ****** | Filed herewith. |
ITEM 16. FORM 10-K SUMMARY
None.
| 23 |
SIGNATURES
Pursuant to the requirements of the Section 13 or 15 or 15(d) 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 on the 15th day of April, 2025.
| BOWEN ACQUISITION CORP | ||
| By: | /s/ Jiangang Luo | |
| Jiangang Luo | ||
| Chief Executive Officer | ||
In accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| Name | Position | Date | ||
| /s/ Na Gai | Chairwoman | April 15, 2025 | ||
| Na Gai | ||||
| /s/ Jiangang Luo | Chief Executive Officer | April 15, 2025 | ||
| Jiangang Luo | (Principal Executive Officer) | |||
| /s/ Jing Lu | Chief Financial Officer | April 15, 2025 | ||
| Jing Lu | (Principal Financial and Accounting Officer) | |||
| /s/Lawrence Leighton | Director | April 15, 2025 | ||
| Lawrence Leighton | ||||
| /s/Wei Li | Director | April 15, 2025 | ||
| Wei Li | ||||
| /s/Jun Zhang | Director | April 15, 2025 | ||
| Jun Zhang | ||||
| 24 |
BOWEN ACQUISITION CORP
INDEX TO THE FINANCIAL STATEMENTS
| Page | |
| Report of Independent Registered Public Accounting Firm (PCAOB # |
F-2 |
| Financial Statements: | |
| Consolidated Balance Sheets | F-3 |
| Consolidated Statements of Operations | F-4 |
| Consolidated Statements of Changes in Stockholders’ (Deficit) Equity | F-5 |
| Consolidated Statements of Cash Flows | F-6 |
| Notes to Consolidated Financial Statements | F-7 to F-18 |
| F-1 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Shareholders of Bowen Acquisition Corp and its subsidiary
Opinion on the Financial Statements
Substantial Doubt about the Company’s Ability to Continue as a Going Concern
The accompanying consolidated financial statements have been prepared to assume the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has no revenue, and incurred and expects to continue to incur significant professional costs to remain as a publicly traded company and to incur significant transaction costs in the pursuit of the consummation of a business combination. The Company’s cash and working capital as of December 31, 2024, are not sufficient to complete its planned activities for the upcoming year. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1 to the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to that matter.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
| /s/
|
| We have served as the Company’s auditor since 2023. |
| April 15, 2025 |
| F-2 |
BOWEN ACQUISITION CORP
CONSOLIDATED BALANCE SHEETS
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Other receivable | ||||||||
| Prepaid expenses | ||||||||
| Total Current Assets | ||||||||
| Investment held in Trust Account | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accrued offering costs and expenses | $ | $ | ||||||
| Accrued expenses - related party | ||||||||
| Promissory note - related party (net of unamortized debt discount of $ | ||||||||
| Promissory Note | ||||||||
| Payable to target company | ||||||||
| Total Current Liabilities | ||||||||
| Total Liabilities | ||||||||
| Commitments and contingencies (Note 6) | ||||||||
| Ordinary shares subject to possible redemption, shares at redemption value of $ and $ per share as of December 31, 2024 and 2023, respectively | ||||||||
| Shareholders’ Equity: | ||||||||
| Preferred shares, $ par value; shares authorized; issued and outstanding | ||||||||
| Ordinary shares, $ par value; shares authorized; shares issued and outstanding (excluding shares subject to redemption on December 31, 2024 and 2023, respectively) | ||||||||
| Additional paid-in capital | ||||||||
| Retained earnings (Accumulated deficit) | ( | ) | ||||||
| Total Shareholders’ Equity (Deficit) | ( | ) | ||||||
| Total Liabilities and Shareholders’ Equity | $ | $ | ||||||
The accompanying notes are an integral part of the consolidated financial statements.
| F-3 |
BOWEN ACQUISITION CORP
CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Year Ended December 31, 2024 | For the Period from February 17, 2023 (Inception) Through December 31, 2023 | |||||||
| Formation and operating costs | $ | $ | ||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Other income: | ||||||||
| Interest earned on investments held in trust account | ||||||||
| Total other income | ||||||||
| Other expense: | ||||||||
| Interest expense | ( | ) | ||||||
| Total other expense | ( | ) | ||||||
| Net income | $ | $ | ||||||
| Basic and diluted weighted average ordinary shares outstanding, redeemable ordinary shares | ||||||||
| Basic and diluted net income per share, redeemable ordinary shares | $ | $ | ||||||
| Basic and diluted weighted average ordinary shares outstanding, non-redeemable ordinary shares | ||||||||
| Basic and diluted net loss per share, non-redeemable ordinary shares | $ | ) | $ | ) | ||||
The accompanying notes are an integral part of the consolidated financial statements.
| F-4 |
BOWEN ACQUISITION CORP
STATEMENTS OF CHANGES IN SHAREHOLDERS’ (DEFICIT) EQUITY
FOR THE YEAR ENDED DECEMBER 31, 2024
| Ordinary Shares | Additional Paid-in | Retained Earnings (Accumulated | Total Shareholders’ Equity | |||||||||||||||||
| Shares | Amount | Capital | Deficit) |
(Deficit) | ||||||||||||||||
| Balance as of January 1, 2024 | $ | $ | $ | $ | ||||||||||||||||
| Subsequent measurement of Common stock subject to possible redemption (interest earned on trust account) | - | ( | ) | ( | ) | ( | ) | |||||||||||||
| Subsequent measurement of Common stock subject to possible redemption (extension deposit) | - | ( | ) | ( | ) | |||||||||||||||
| Debt discount allocation to APIC | - | |||||||||||||||||||
| Net income | - | |||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
FOR THE PERIOD FROM FEBURARY 17, 2023 (INCEPTION) THROUGH DECEMBER 31, 2023
| Ordinary Shares | Additional Paid-in | Retained Earnings (Accumulated | Total Shareholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit) | Equity | ||||||||||||||||
| Balance on February 17, 2023 (inception) | $ | $ | $ | $ | ||||||||||||||||
| Issuance of ordinary shares to Sponsors | ||||||||||||||||||||
| Issuance of ordinary shares to Underwriter | ||||||||||||||||||||
| Proceeds from sale of public units | ||||||||||||||||||||
| Proceeds from over-allotment | ||||||||||||||||||||
| Sale of Private Units | ||||||||||||||||||||
| Over-allotment of Private Units | ||||||||||||||||||||
| Underwriter’s commission on sale of Public Units | - | ( | ) | ( | ) | |||||||||||||||
| Underwriter’s commission on Over-allotment | - | ( | ) | ( | ) | |||||||||||||||
| Other offering costs | - | ( | ) | ( | ) | |||||||||||||||
| Initial measurement of Ordinary shares Subject to redemption under ASC 480-10-S99 against additional paid-in capital | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Allocation of offering costs to ordinary shares subject to redemption | - | |||||||||||||||||||
| Deduction for increase of carrying value of redeemable shares | - | ( | ) | ( | ) | |||||||||||||||
| Subsequent measurement of Common stock subject to possible redemption (interest earned on trust account) | - | ( | ) | ( | ) | ( | ) | |||||||||||||
| Net income | - | |||||||||||||||||||
| Balance as of December 31, 2023 | $ | $ | $ | $ | ||||||||||||||||
The accompanying notes are an integral part of the consolidated financial statements.
| F-5 |
BOWEN ACQUISITION CORP
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Year Ended December 31, 2024 | For the Period from December 31, 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | $ | ||||||
| Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
| Income earned on investment held in Trust Account | ( | ) | ( | ) | ||||
| Amortized interest expense from debt discount | ||||||||
| Changes in current assets and liabilities: | ||||||||
| Accrued offering costs and expenses | ||||||||
| Accrued expenses - related party | ||||||||
| Prepaid expenses | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Investments of cash into Trust Account | ( | ) | ||||||
| Extension deposit to Trust Account | ( | ) | ||||||
| Net cash used in investing activities | ( | ) | ( | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from promissory note – related party | ||||||||
| Proceeds from promissory note | ||||||||
| Proceeds from issuance of founder shares | ||||||||
| Proceeds from sale of ordinary shares | ||||||||
| Proceeds from Private Placement | ||||||||
| Payments of underwriter’s discount | ( | ) | ||||||
| Payments to related party | ( | ) | ||||||
| Payment of offering costs | ( | ) | ||||||
| Net cash provided by financing activities | ||||||||
| Net change in cash | ( | ) | ||||||
| Cash at beginning of period | ||||||||
| Cash at the end of period | $ | $ | ||||||
| Supplemental disclosure of noncash financing activities | ||||||||
| Subsequent measurement of ordinary shares subject to possible redemption (income earned on trust account) | $ | $ | ||||||
| Subsequent measurement of ordinary shares subject to possible redemption (extension deposit) | $ | $ | ||||||
| Offering costs paid by related party | $ | $ | ||||||
| Offering costs adjusted from prepaid expenses | $ | |||||||
| Debt discount in connection with promissory note | $ | $ | ||||||
| Offering costs paid by Sponsor in exchange for issuance of ordinary shares | $ | $ | ||||||
| Offering costs charged to APIC | $ | $ | ||||||
| Reclassification of ordinary shares subject to redemption | $ | $ | ||||||
| Allocation of offering costs to ordinary shares subject to redemption | $ | $ | ||||||
| Remeasurement adjustment on ordinary shares subject to possible redemption | $ | $ | ||||||
The accompanying notes are an integral part of the consolidated financial statements.
| F-6 |
BOWEN ACQUISITION CORP
Notes to the CONSOLIDATED financial statements
NOTE 1 - ORGANIZATION AND BUSINESS OPERATIONS
Organizational and General
Bowen Acquisition Corp (the “Company”) was incorporated in the Cayman Islands on February 17, 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 (the “Business Combination”).The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination.
The Company’s sponsors are Createcharm Holdings Ltd., a British Virgin Islands company, and Bowen Holding LP, a Delaware limited partnership (the “Sponsors”). As of December 31, 2024, the Company had not commenced any operations. All activities for the period from February 17, 2023 (inception) through December 31, 2024 relate to the Company’s formation, the initial public offering (“IPO”) and initial business combination, which is described below. The Company will not generate any operating revenues until after the completion of an initial Business Combination, at the earliest. The Company is generating non-operating income in the form of interest 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 July 11, 2023. On July 14, 2023, the Company consummated the
IPO of of its units (“Public Units”). Each Public Unit consists of one ordinary share, $ par value (“Ordinary
Shares”), of the Company and one right (“Rights”), each Right entitling the holder thereof to receive one-tenth of one
ordinary share upon the completion of the Company’s initial business combination. The Public Units were sold at an offering price
of $ per Unit, generating gross proceeds of $
Simultaneously with the consummation of the IPO, the
Company consummated the private placement (“Private Placement”) of units (“Private Placement Units”) at
a price of $ per Private Placement Unit, generating total proceeds of $
On July 17, 2023, the underwriters exercised their
over-allotment option in full to purchase an additional Units. As a result, on July 18, 2023, the Company sold an additional
Units at $ per Unit, generating gross proceeds of $
As of July 18, 2023, transaction costs amounted to
$
| F-7 |
The Company will have until 18 months from the closing of the IPO to consummate a Business Combination (the “Combination Period”). However, if the Company has not completed a Business Combination within the Combination Period and shareholders have not otherwise amended the Amended and Restated Memorandum and Articles of Association to extend this 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 100% of the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned and not previously released to us to pay the Company’s taxes, if any (less certain amount of interest to pay dissolution expenses), divided by the number of then issued and outstanding Public Shares, which redemption will completely extinguish the rights of the Public Shareholders as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining Public Shareholders and its Board of Directors, liquidate and dissolve, subject to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.
On November 20, 2023, a wholly-owned subsidiary of the Company, Bowen Merger Sub (“Merger Sub”) was formed for the purpose of entering into a business combination agreement. See “Proposed Business Combination” below.
Effective as of October 7, 2024, the Company notified
the trustee of the Trust Account that it was extending the time to consummate an initial Business Combination from October 14, 2024 to
January 14, 2025. Effective as of October 14, 2024, Shenzhen Qianzhi (as defined below) and EBC, two designees of the Sponsors, loaned
the Company an aggregate of $
The
Company had called an extraordinary general meeting (the “Extension Meeting”) for January 10, 2025 to approve, by
special resolution and pursuant to the terms of the Company’s amended and restated memorandum and articles of association, as
amended (the “Articles”), an amendment to the Articles to allow the board of directors of the Company (the
“Board”) to extend the date by which the Company must consummate a merger, share exchange, asset acquisition, share
purchase, reorganization or similar business combination with one or more businesses (a “business combination”), by up
to three one-month increments, from January 14, 2025 to as late as April 14, 2025, unless the closing of a business combination
shall have occurred prior thereto or such earlier date as shall be determined by the Board in its sole discretion. In connection
with the meeting, an aggregate of
Public Shares were redeemed at a price of approximately $
per share. Following the redemptions, the Company has Public Shares, and approximately $
On January 14, 2025, the Company held another extraordinary general meeting to approve the business combination with Qianzhi (as defined below). At the meeting, all proposals were approved by shareholders. An aggregate of Public Shares requested redemption in connection with such vote. However, as the business combination has not been consummated, none of such shares has been redeemed. As of the filing date, since the business combination has not been consummated, none of such shares have been redeemed.
On April 14, 2025, the Company held an extraordinary
general meeting to approve a proposal to extend the time the Company had to consummate its initial Business Combination to up to July
14, 2025. In connection with the meeting, an aggregate of Public Shares were redeemed at a price of approximately $ per share.
Following the redemptions, the Company has Public Shares, and approximately $
Proposed Business Combination
On January 18, 2024, the Company entered into an Agreement and Plan of Reorganization (the “Agreement”) with (i) Bowen Merger Sub, a Cayman Islands exempted company and a wholly owned subsidiary of the Company (“Merger Sub”), (ii) Shenzhen Qianzhi BioTechnology Co. Ltd., a company incorporated in the People’s Republic of China and a wholly owned subsidiary of NewCo (as defined below) (“Shenzhen Qianzhi”or “Qianzhi”), and (iii) Qianzhi Group Holding (Cayman) Limited, a newly formed Cayman Islands company (“NewCo,” and collectively with the Company, Merger Sub and Shenzhen Qianzhi, the “Parties”, each a “Party”).
Pursuant to the Agreement, at the closing of the business combination, Merger Sub will merge with and into NewCo (the “Merger”), with NewCo being the surviving company of the Merger (“Surviving Company”) and becoming a wholly owned subsidiary of the Company. In the Merger, the holders (the “NewCo Shareholders”) of the ordinary shares of NewCo (“NewCo Ordinary Shares”) will receive ordinary shares of the Company (“Parent Ordinary Shares”).
Pursuant to the Agreement, at the effective time of the Merger (the “Effective Time”), all of NewCo Ordinary Shares issued and outstanding immediately prior to the Effective Time will be automatically converted into the right to receive an aggregate of (a) Parent Ordinary Shares (the “Merger Shares”), and (b) the right to receive earnout consideration of up to an aggregate of Parent Ordinary Shares (the “Earnout Shares”).
The Company’s Registration Statement on Form S-4 (“S-4”) was declared effective on December 18, 2024. As of the filing date, the business combination remained pending, awaiting required regulatory approvals.
| F-8 |
Going Concern Consideration
As of December 31, 2024, the Company
had cash and cash equivalent of $
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and are presented in U.S. dollars 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. All intercompany accounts and transactions are eliminated upon consolidation.
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.
| F-9 |
Use of Estimates
The preparation of the consolidated 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 consolidated 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.
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
equivalents balance of $
Investments Held in Trust Account
The Company’s portfolio of investments held
in the Trust Account is comprised of investments only 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. 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
December 31, 2024 and 2023, the Trust Account had balance of $
Offering Costs
Offering costs consist of legal 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 July 14, 2023.
Interest Expenses
Interest expense in 2024 is primarily from the amortization of the debt discount in connection with the promissory note issued by the Company to related party. See Note 5 - Related Parties for more information.
Amortization of Debt Discount
The Company’s promissory note issued with related party is recorded net of debt discount which comprised issuance costs, and the discount initially recognized for the fair value of the shares transferred. The portion of the debt issuance costs allocated to the promissory note, is being amortized over the terms, which is upon consummation of the Business Combination. The amortization of debt issuance costs and discount is included in interest expense within the accompanying consolidated statements of operations.
| F-10 |
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 consolidated 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 December 31, 2024 and 2023, 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.
The net income (loss) per share presented in the statements of operations is based on the following:
For the Year Ended | For the Period from Through December 31, 2023 | |||||||
| Net income | $ | $ | ||||||
| Interest earned on investment held in Trust Account | ( | ) | ( | ) | ||||
| Accretion of temporary equity into redemption value | ( | ) | ( | ) | ||||
| Net loss including accretion of equity into redemption value | $ | ( | ) | $ | ( | ) | ||
| F-11 |
For the Year ended December 31, 2024 | For the Period from December 31, 2023 | |||||||||||||||
| Redeemable | Non- Redeemable | Redeemable | Non- Redeemable | |||||||||||||
| Particulars | Shares | Shares | Shares | Shares | ||||||||||||
| Basic and diluted net income (loss) per share: | ||||||||||||||||
| Weighted-average shares outstanding | ||||||||||||||||
| Ownership percentage | % | % | % | % | ||||||||||||
| Numerators: | ||||||||||||||||
| Allocation of net loss including accretion of temporary equity | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Accretion of temporary equity into redemption value | ||||||||||||||||
| Interest earned on Trust Account | ||||||||||||||||
| 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 $
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.
| F-12 |
| 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 | ||||
| Over-allotment | ||||
| Plus: | ||||
| Over-allotment proceeds | ||||
| Less: | ||||
| Proceeds allocated to Public Rights | ( |
) | ||
| Allocation of offering costs related to redeemable shares | ( |
) | ||
| Plus: | ||||
| Accretion of carrying value to redemption value | ||||
| Subsequent measurement of ordinary shares subject to possible redemption (income earned on trust account) | ||||
| Ordinary shares subject to possible redemption, December 31, 2023 | $ | |||
| Plus: | ||||
| Subsequent measurement of ordinary shares subject to possible redemption (income earned on trust account) | ||||
| Subsequent measurement of ordinary shares subject to possible redemption (extension deposit) | ||||
| Ordinary shares subject to possible redemption, December 31, 2024 | $ |
Recent Accounting Standards
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this ASU require disclosures, on an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating officer decision maker (“CODM”), as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. The ASU requires that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. Public entities will be required to provide all annual disclosures currently required by Topic 280 in interim periods, and entities with a single reportable segment are required to provide all the disclosures required by the amendments in this ASU and existing segment disclosures in Topic 280. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company adopted the guidance in ASU 2023-07 on January 1, 2024, and there is no significant impact on the disclosure of the consolidated financial statements. The Company’s chief operating decision maker has been identified as the Chief Executive Officer (“CODM”), who reviews the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, management has determined that the Company only has one operating and reportable segment.
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 consolidated financial statements.
NOTE 3 — INITIAL PUBLIC OFFERING
On
July 14, 2023, the Company sold Units at a price of $ per Unit.
The
Company incurred $
NOTE 4 — PRIVATE PLACEMENTS
The
Sponsors and EBC had agreed to purchase an aggregate of Private Placement Units (Private Placement Units to be purchased
by the Sponsors and Private Placement Units to be purchased by EBC or its designees), or Private Placement Units if the
underwriters’ over-allotment is exercised in full, at a price of $ per Private Placement Unit ($
| F-13 |
Simultaneously
with the closing of the IPO on July 14, 2023, the Company consummated the private sale of Private Placement Units.
On July 17, 2023, the underwriters exercised the over-allotment option in full. See Note 1 for more details.
NOTE 5 — RELATED PARTIES
Founder Shares and EBC Founder Shares
On February
27, 2023, the Sponsors received of the Company’s ordinary shares (“Founder Shares”) in exchange for $
On March
15, 2023, the Company issued to EBC ordinary shares (“EBC founder shares”) for a purchase price of $ per share
and an aggregate purchase price of $
| Time to expiration | ||||
| Risk-free rate | % | |||
| Volatility | % | |||
| Dividend yield | % | |||
| Probability of completion of business combination | % |
The Sponsors have agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of: (A) six months after the completion of the initial Business Combination and (B) the date on which the Company completes a liquidation, merger, share exchange, reorganization or other similar transaction after an initial Business Combination that results in all of the Company’s public shareholders having the right to exchange their ordinary shares for cash, securities or other property. EBC has also agreed, subject to exceptions, that the EBC founder shares cannot be sold, transferred or assigned, until the consummation of an initial business combination.
On October 14, 2024, one of the Sponsors transferred of its Founder Shares to EBC in connection with $ loan for the extension. See below for more details.
Promissory Note — Related Party
On February
27, 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 $
On October 14, 2024, EBC loaned the Company $ which funds were deposited into the Trust Account for the extension. The loan is evidenced by promissory note issued by the Company (“Extension Note”). The Extension Note bears no interest and is repayable in full upon consummation of a Business Combination. In connection with the loan, one of the Sponsors transferred of its Founder Shares to EBC. The value of the shares transferred is reflected as debt discount and fully amortized as interest expense over the life of the loan per ASC 835. As of December 31, 2024, $ was outstanding.
| F-14 |
| Time to expiration | ||||
| Risk-free rate | % | |||
| Volatility | % | |||
| Dividend yield | % | |||
| Probability of completion of business combination | % |
Based on
the fair value of the Founder Shares, the Company recorded a debt discount of $
Underwriting Agreement
The Company granted the underwriters a 45-day option from the date of IPO to purchase up to additional Units to cover over-allotments, at the IPO price less the underwriting discounts and commissions.
The underwriters
were entitled to a cash underwriting discount of $
On July 17,
2023, the underwriters exercised the over-allotment option in full to purchase Units. As a result, on July 18, 2023, the Company
sold an additional Units at $ per Unit, generating gross proceeds to the Company of $
Due to Related Party
The Sponsors
paid certain formation, operating or offering costs on behalf of the Company. These amounts were due on demand and non-interest bearing.
Before the IPO, the Sponsors had paid $
As of December
31, 2024, the total accrued expenses due to related parties was $
Accounting Service Agreement and Others
The
Company has engaged TenX Global Capital, a related party of the Company, to assist in initial accounting preparation, preparing
quarterly and annual financial statements commencing following the consummation of the IPO. The Company has agreed to pay for these
services at a fixed quarterly rate of $
| F-15 |
Administration Fee
Commencing
on the effectiveness of the Registration Statement on July 11, 2023, an affiliate of the Sponsors will be allowed to charge the Company
an allocable share of its overhead, up to $
The following table presents details about the expenses incurred and payable for the year ended December 31, 2024 and during the period from February 17, 2023 (inception) through December 31, 2023:
| Nature | Operating Costs | Payable Balance as of December 31, | ||||||||||||||
| For the year ended December 31, 2024 | During the period from February 17, 2023 (inception) through December 31, 2023 | 2024 | 2023 | |||||||||||||
| Initial accounting service fee | $ | $ | $ | $ | ||||||||||||
| Accounting service fee and others | ||||||||||||||||
| Administration fee | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
NOTE 6 — COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the Founder Shares, EBC founder shares, Private Placement Units will be entitled to registration rights pursuant to a registration rights agreement dated on the effectiveness of the Registration Statement on July 11, 2023 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.
Business Combination Marketing Agreement
The
Company has engaged EBC as an advisor in connection with its Business Combination to assist in holding meetings with the Company
stockholders to discuss the potential Business Combination and the target business’ attributes, introduce the Company to
potential investors that are interested in purchasing its securities in connection with its initial Business Combination and assist
with press releases and public filings in connection with the Business Combination. The Company will pay EBC a service fee for such
services upon the consummation of its initial Business Combination in an amount of $
Business Combination Transaction Cost
The
Company has engaged several service providers including legal and valuation services, specifically for business combination between the
Company and Shenzhen Qianzhi BioTechnology Co. Ltd. (“Qianzhi”). Per the agreed terms, Qianzhi agreed to be responsible for
all expenses incurred by the Company in connection with business combination. For the year ended December 31, 2024, $
NOTE 7 — SHAREHOLDERS’ EQUITY
Preferred
Shares — The Company is authorized to issue preferred shares with a par value of $ per share with such designations,
| F-16 |
Ordinary
Shares — The Company is authorized to issue ordinary shares with a par value of $ per share.
Rights
— Except in cases where the Company is not the surviving company in a business combination,
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 table presents information about the Company’s assets that are measured at fair value on a recurring basis at December 31, 2024 and 2023, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
| Date | Nature | Level | Fair Value | |||||||
| December 31, 2024 | Marketable securities held in the trust account | 1 | $ | |||||||
December 31, 2024 |
Cash equivalents | 1 | $ | |||||||
| December 31, 2023 | Marketable securities held in the trust account | 1 | $ | |||||||
| December 31, 2023 | Cash equivalents | 1 | $ | |||||||
| F-17 |
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 available to be issued. Based upon this review, the Company identified the following subsequent event that would have required adjustment or disclosure in the financial statements.
On January 10, 2025, the Company held an extraordinary general meeting (the “Meeting”) by special resolution and pursuant to the terms of the Company’s amended and restated memorandum and articles of association, as amended (the “Articles”), an amendment to the Articles to allow the board of directors of the Company (the “Board”) to extend the date (the “Extension”) by which the Company must consummate a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (a “business combination”), by up to three one-month increments, from January 14, 2025 to as late as April 14, 2025, unless the closing of a business combination shall have occurred prior thereto or such earlier date as shall be determined by the Board in its sole discretion. In connection with the meeting, an aggregate of Public Shares were redeemed at a price of approximately $ per share.
On January 13, 2025, the Company entered into Prepaid
Forward Purchase Agreement (the “FPA”) by and among the Company, NewCo, and the funds, accounts and/other investment vehicles
managed by Harraden Circle Investments, LLC signatory thereto (collectively, the “Purchaser”).
On January 14, 2025, the Company held an extraordinary general meeting (the “Business Combination Meeting”) to approve, among other matters, its proposed business combination (the “Business Combination”) with NewCo and Qianzhi. The Company’s shareholders voted on the proposals at the Business Combination Meeting, all of which were described in the Company’s Registration Statement on Form S-4 (“S-4”) which was filed with the Securities and Exchange Commission (“SEC”) and included a prospectus of the Company as well as the Company’s proxy statement (the “Proxy Statement/Prospectus”). All of the proposals were approved. An aggregate of Public Shares requested redemption in connection with such vote. However, as the business combination has not been consummated, none of such shares has been redeemed.
On March 19, 2025, the Company received a notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) stating that, for the prior 30 consecutive business days (through March 18, 2025), the closing market value of listed securities (MVLS) of the Company’s ordinary shares, $ par value per share, had been below the minimum of $50 million required for continued listing on the Nasdaq Global Market under Nasdaq Listing Rule 5450(b)(2)(A) (the “Rule”). The notice stated that the Company would be afforded 180 calendar days (until September 15, 2025) to regain compliance. In order to regain compliance, the closing MVLS of the Company’s securities must be at least $50 million for a minimum of ten consecutive business days. If the Company does not regain compliance within the 180-day period, the securities will be subject to delisting. On April 10, 2025, the Company received a notice from Nasdaq stating that it has regained compliance with the Rule, and this matter is now closed.
On April 14, 2025, the Company held an extraordinary general meeting to approve a proposal to extend the time the Company had to consummate its initial Business Combination to up to July 14, 2025. In connection with the meeting, an aggregate of Public Shares were redeemed at a price of approximately $ per share.
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