Related Party Transactions |
3 Months Ended |
|---|---|
Mar. 31, 2026 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions | NOTE 4. RELATED PARTY TRANSACTIONS Founder Shares On September 29, 2025, the Sponsor purchased 8,852,917 Class B ordinary shares from the Company for an aggregate purchase price of $25,000, or $0.00282 per share, of which up to 1,136,250 founder shares were subject to forfeiture depending on the extent to which the Underwriters’ over-allotment option was exercised during the Initial Public Offering. On February 19, 2026, the Underwriters partially exercised its over-allotment option and forfeited the unexercised balance. As a result of the partial exercise and the forfeiture of the over-allotment option by the Underwriters, 791,167 of such founder shares are no longer subject to forfeiture and 345,083 of such founder shares were forfeited, resulting in the Sponsor holding 8,252,834 founder shares. On December 15, 2025, the Sponsor assigned and transferred and aggregate of 255,000 Class B ordinary shares, of $0.0001 par value per share, to the three directors of the Company (85,000 Class B ordinary shares each). The directors are receiving such shares for their role as directors of the Company. The shares granted have the following vesting terms: (i) 8,500 shares, per director (an aggregate of 25,500 shares) vested upon the closing of the Initial Public Offering, (ii) 76,500 shares per director (an aggregate of 229,500 shares) will vest in six equity quarterly installments after the Initial Public Offering date, until the 18-month anniversary of the Initial Public Offering, and (iii) the shares shall vest immediately upon the closing of an initial Business Combination of the Company. If the director ceases to be a director of the Company, any shares not vested as per the terms noted above will be forfeited for no consideration. The transfer of the founder shares to the Company’s directors is in the scope of ASC 718. Under FASB ASC Topic 718, share-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the 255,000 shares transferred to the Company’s directors is $490,306 or $1.92 per share. The Company recognized share-based compensation expense of $49,031 upon the closing of the Initial Public Offering, as such shares vested at that time in accordance with the terms of the transfer. The Company established the initial fair value for the directors’ founder shares using Monte Carlo Simulation Model prepared by a third party valuation firm, which takes into consideration the following market assumptions; (i) likelihood of completing the Initial Public Offering was assumed to be 90%, (ii) the common share price was $9.868 based on implied share price, (iii) likelihood of a Business Combination was determined to be 21.7%, (iv) the implied volatility based on the current quoted prices of the warrants and underlying share was 8.0% and (v) a discount for lack of marketability based on a Finnerty put model yielded 2.5%. The founder shares are classified as Level 3 at the measurement date due to the use of unobservable inputs, and other risk factors. Private Placement Units Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 400,000 Private Placement Units at $10.00 per Private Placement Unit in a private placement for an aggregate purchase price of $4,000,000. The Underwriters purchased an aggregate of 272,000 Private Placement Units at a price of $10.00 per Private Placement Unit in a private placement for an aggregate purchase price of $2,720,000. A portion of the purchase price of the Private Placement Units will be added to the proceeds of Initial Public Offering to be held in the Trust Account. If the initial Business Combination was not completed within 18 months from the closing of the Initial Public Offering, the proceeds from the sale of the Private Placement Units held in the Trust Account will be used to fund the redemption of the public shares (subject to the requirements of applicable law). Certain institutional investors (none of which are affiliated with any member of management, the Sponsor or any other investor), referred to as the “non-managing investors”, committed, pursuant to written agreement, to purchase, indirectly through the purchase of non-managing membership interests in the Sponsor, an aggregate of 275,000 Private Placement Units out of the 400,000 Private Placement Units purchased by the Sponsor. Subject to each non-managing sponsor investor purchasing the Private Placement Units allocated to it in connection with the closing of the Initial Public Offering, the Sponsor issued additional membership interests at a nominal purchase price to the non-managing investors reflecting interests in an aggregate of 2.2 million founder shares. The agreement with the non-managing investors was entered into directly with the Sponsor entity and it makes reference to the Private Placement Units and founder shares of the Company. The interests and units associated in the agreement are supported on one for one basis with the Company’s underlying Private Placement Units and founder shares. The fact that the Sponsor is providing the non-managing members with founder shares for their participation in the transaction is considered an inducement and falls under SAB Topic 5A. As such, the Company has obtained a valuation of the founder shares, as of the Initial Public Offering date to account for the charge of such transfer of interests to the non-managing members. The valuation has identified the fair value of the founder shares to be $1.60 per share as of the close of the Initial Public Offering, on February 19, 2026. Since the cost of these interest allocations to the non-managing members is considered an offering cost, the Company will record the fair value of this transaction into equity at the Initial Public Offering date calculated as 2,200,000 interests in founder shares allocated to non-managing members at a fair value of $1.60, or $3,513,866. The third-party valuation firm used a Monte Carlo simulation to value the founder shares. The likelihood of completing the Initial Public Offering was assumed to be 100%; the common share price was $9.847 based on implied share price; likelihood of a Business Combination was determined to be 16.7%; the implied volatility based on the current quoted prices of the warrants and underlying share was 9.6%; and a discount for lack of marketability based on a Finnerty put model yielded 2.8%. Promissory Note — Re lated Party The Sponsor had agreed to loan the Company an aggregate of up to $300,000 to be used for a portion of the expenses of the Initial Public Offering. The loan is non-interest bearing, unsecured and payable at the earlier of March 31, 2026 (as amended) or the closing of the Initial Public Offering. As of March 31, 2026, the Company repaid the outstanding balance of the note amounting to $141,000. Borrowings under the note is no longer available. Administration Fees Commencing on February 17, 2026, the Company has agreed to pay the Sponsor $19,000 per month for office space, administrative and support services. These monthly fees will cease upon the completion of the initial Business Combination or the liquidation of the Company. The Sponsor has agreed to defer payment of the administration fees as appropriate to ensure there is sufficient liquidity to support operations of the Company. As of March 31, 2026, the Company had paid $38,000 in administrative services fees of which $28,500 had been incurred and $9,500 is included in prepaid expenses in the accompanying balance sheet. As of December 31, 2025, the Company did not incur any fees for these services. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required. If the Company completes a Business Combination, the Company would repay the Working Capital Loans. In the event that a Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay the Working Capital Loans but no proceeds from the Trust Account would be used to repay the Working Capital Loans. Up to $1,500,000 of such Working Capital Loans may be convertible into Private Placement Units of the post Business Combination entity at a price of $10.00 per unit at the option of the lender. The units would be identical to the Private Placement Units. As of March 31, 2026 and December 31, 2025, no such Working Capital Loans were outstanding.
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