SEC Filing Summary: Bellevue Life Sciences Acquisition Corp. (BLAC)
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2024. Bellevue Life Sciences Acquisition Corp. (BLAC) is a Special Purpose Acquisition Company (SPAC) incorporated in Delaware. The Company has not commenced operations and is seeking to consummate a business combination with OSR Holdings Co., Ltd., a Korean corporation. The Company is an emerging growth company and a shell company. As of June 30, 2024, the Company had extended its deadline to complete a business combination to November 14, 2024.
Key Financial Metrics
| Metric | As of/For Period Ended June 30, 2024 | As of/For Period Ended Dec 31, 2023 |
|---|---|---|
| Cash (Operating Account) | $119,116 | $15,419 |
| Investments in Trust Account | $20,466,815 | $36,605,106 |
| Total Assets | $20,633,643 | $36,627,733 |
| Total Liabilities | $5,488,128 | $4,108,272 |
| Stockholders' Deficit | ($4,903,575) | ($3,906,792) |
| Working Capital Deficit | ($3,251,300) | N/A |
| Net Loss (Six Months) | ($157,725) | Net Income: $411,769 (2023) |
| Net Loss (Three Months) | ($97,295) | Net Income: $301,464 (2023) |
| Public Shares Subject to Redemption | 1,886,221 shares | 3,467,954 shares |
Debt and Liquidity: The Company has a working capital deficit of $3.25 million. Current liabilities include $1.5 million in notes payable to related parties and $530,415 in excise tax payable. The Company relies on loans from the Sponsor and related parties to fund operations.
Material Changes vs. Prior Period
- Redemptions: Significant redemptions occurred in May 2024. 1,581,733 shares were redeemed at approximately $10.78 per share, totaling $17,045,763 withdrawn from the Trust Account. This reduced the Trust Account balance from $36.6 million to $20.5 million.
- Operating Expenses: General and administrative expenses increased to $926,325 for the six months ended June 30, 2024, compared to $558,375 in the prior year period.
- Interest Income: Interest earned on the Trust Account decreased to $946,329 (six months 2024) from $1.23 million (six months 2023), reflecting the lower principal balance due to redemptions.
- Related Party Debt: The Company issued multiple new promissory notes to the Sponsor and affiliates in 2024 to fund working capital and extension payments, totaling approximately $1.5 million in outstanding related party notes as of June 30, 2024.
Outlook, Risks, and Management Commentary
- Business Combination: The Company has entered into an Amended and Restated Business Combination Agreement with OSR Holdings. The transaction is subject to stockholder approval and a minimum cash condition of $5,000,001.
- Going Concern: Management has raised substantial doubt about the Company's ability to continue as a going concern. The Company has limited working capital and relies on Sponsor loans to meet obligations until the business combination or liquidation.
- Nasdaq Compliance: The Company received notice of non-compliance with the minimum 300 public holders requirement. Nasdaq granted an extension until August 13, 2024, to demonstrate compliance. Failure to comply may result in delisting.
- Internal Controls: The Company disclosed material weaknesses in internal controls over financial reporting, including the use of Trust funds for general expenses and lack of timely documentation for related party transactions.
- Excise Tax: The Company recorded a $530,415 liability for the 1% excise tax on stock repurchases under the Inflation Reduction Act.
Investor Verification Checklist
- Extension Deadline: Verify the current status of the business combination deadline (currently November 14, 2024) and any further extension proposals.
- Nasdaq Listing Status: Confirm whether the Company has met the 300 public holder requirement by the August 13, 2024 deadline to avoid delisting.
- Trust Account Balance: Monitor the Trust Account balance ($20.5M) against the $5.0M minimum cash condition required for the OSR Holdings deal to close.
- Related Party Loans: Review the terms of the outstanding promissory notes to the Sponsor, specifically regarding forgiveness conditions if the deal fails.
- Internal Control Remediation: Assess the progress of remediation efforts for the disclosed material weaknesses in financial reporting.