Business Context and Reporting Period
Tavia Acquisition Corp. (TAVI) is a Cayman Islands exempted company incorporated on March 7, 2024, operating as a Special Purpose Acquisition Company (SPAC). The company is an "emerging growth company" and a "smaller reporting company" with no operating history or revenues to date. Its sole purpose is to effect a merger, share exchange, or asset acquisition with one or more target businesses, primarily focusing on new energy, circular economy, and innovative agricultural/food technologies in North America and Europe.
This Form 10-K covers the fiscal year ended December 31, 2025, and the period from inception (March 7, 2024) through December 31, 2024. The company consummated its Initial Public Offering (IPO) on December 5, 2024, and has until June 5, 2026 (18 months from IPO closing) to complete an initial business combination.
Key Financial Metrics
| Metric | Year Ended Dec 31, 2025 | Period Inception to Dec 31, 2024 |
|---|---|---|
| Net Income | $3,605,405 | $79,518 |
| Operating Expenses | $1,221,951 | $272,419 |
| Interest Income (Trust Account) | $4,827,356 | $351,937 |
| Cash and Cash Equivalents (Outside Trust) | $229,625 | $913,659 |
| Marketable Securities (Trust Account) | $120,754,293 | $115,926,937 |
| Working Capital Deficit | ($1,053,365) | N/A |
| Redemption Value per Public Share | ~$10.50 | ~$10.06 |
Liquidity and Debt: As of December 31, 2025, the company held $120,754,293 in the Trust Account. Outside the Trust Account, the company had a working capital deficit of $1,053,365. Current liabilities include $500,000 in a promissory note to a related party (Sponsor) and $131,684 in advances from a related party. On February 2, 2026, the company issued an additional non-interest-bearing promissory note to EarlyBirdCapital, Inc. (EBC) for up to $300,000.
Material Changes vs. Prior Period
- Trust Account Growth: The balance in the Trust Account increased from $115,926,937 in 2024 to $120,754,293 in 2025, driven by $4.8 million in interest income earned on U.S. government securities.
- Operating Cash Flow: Cash used in operating activities increased significantly to $674,034 in 2025 compared to $74,275 in the prior period, reflecting higher general and administrative costs associated with being a public company and searching for a target.
- Equity Position: The company moved from a shareholders' equity of $409,657 in 2024 to a deficit of ($1,053,365) in 2025. This shift is primarily due to the accretion of ordinary shares to their redemption value, which reduced additional paid-in capital and retained earnings.
- Accounting Firm Change: The company dismissed Marcum LLP and engaged WithumSmith+Brown PC as its independent registered public accounting firm effective January 20, 2025.
Outlook, Risks, and Management Commentary
Outlook and Guidance: Management expects to incur increased expenses as a public company and for due diligence. The company has no operating revenues and does not expect to generate any until after a business combination. The company has 18 months from the IPO closing (until June 5, 2026) to consummate a transaction. If no combination is completed, the company will liquidate and redeem public shares.
Going Concern: The independent auditor's report includes an explanatory paragraph expressing substantial doubt about the company's ability to continue as a "going concern" due to the working capital deficit and the mandatory liquidation date if a business combination is not completed by June 5, 2026.
Risks and Contingencies:
- Redemption Risk: Public shareholders may redeem shares upon a business combination, potentially reducing the cash available for the transaction.
- Trust Account Claims: While the Sponsor has agreed to indemnify the Trust Account against certain third-party claims, there is no guarantee the Sponsor has sufficient assets to satisfy these obligations. If claims deplete the Trust Account, the redemption price could fall below $10.05 per share.
- Geopolitical and Market Risks: The filing highlights risks related to the Russia-Ukraine conflict, the Israel-Hamas conflict, and global economic instability, which could impact the search for targets and capital markets.
- Investment Company Act: There is a risk the company could be deemed an investment company under the Investment Company Act of 1940, which would impose restrictive compliance requirements.
Key Facts for Investor Verification
- Liquidation Deadline: Verify the company's progress toward a business combination before the June 5, 2026 deadline to avoid forced liquidation.
- Trust Account Balance: Confirm the current balance in the Trust Account and the per-share redemption value, which was approximately $10.50 as of December 31, 2025.
- Related Party Loans: Monitor the outstanding $500,000 promissory note to the Sponsor and the new $300,000 note to EBC, as these are due upon business combination or liquidation and may not be repaid if funds outside the Trust are insufficient.
- Working Capital: Assess the company's ability to fund operations outside the Trust Account, given the reported working capital deficit of over $1 million.
- Target Selection: Note that the company has not selected any specific target business and has not engaged in substantive discussions with any targets as of the filing date.