Filing summary
Important identity discrepancy: The request identifies Southland Holdings, Inc., but the supplied Form 10-Q is for Legato Merger Corp. II, a blank-check company. The filing does not provide Southland Holdings’ financial information.
Business context and reporting period
This unaudited 10-Q covers the quarter ended September 30, 2021. Legato was incorporated on July 14, 2021, and had not begun operations by quarter-end; the reported results cover inception through September 30, rather than a full quarter or a comparable prior-year period. Its stated purpose was to pursue a business combination.
Financial results and liquidity
| Metric | Reported amount or status |
|---|---|
| Revenue | None; the company had not commenced operations. |
| Formation and operating costs / net loss | $549 / $(549) from inception through September 30. |
| Cash and total assets at September 30 | $9,614 / $115,556, including $105,942 of deferred offering costs. |
| Current liabilities | $90,235, including a $65,000 stockholder note and $25,235 of deferred offering costs payable. |
| Stockholders’ equity | $25,321. |
| Operating cash flow | $(549); financing cash flow was $10,163, leaving ending cash of $9,614. |
| Debt and commitments | No long-term debt or lease obligations reported. The $65,000 related-party note was settled shortly after the IPO. |
No operating margins or meaningful prior-period comparisons are available. The filing reports no clear comparative-period results.
Material developments and outlook
- After quarter-end, the company completed its IPO on November 24, 2021, raising $240 million, and sold $10.45 million of private units. The underwriters exercised the full over-allotment option, adding $36 million of public-unit proceeds and $1.26 million of private-placement proceeds in December.
- The filing states that $280.14 million was placed in a trust account following the IPO, private placement, and over-allotment, and that $1.716 million was held outside the trust for working capital. Reported transaction costs were $15.661 million, including $9.66 million of deferred underwriting fees.
- Management expected available working capital and borrowing capacity to meet needs through the earlier of a business combination or one year from filing. Funds outside the trust were intended for transaction search and related expenses. The company cautioned that actual search and transaction costs could exceed estimates and that additional financing might be needed.
- The company had a 15-month combination period after the IPO, extendable to 18 months if a definitive agreement was signed within the initial period. Failure to complete a combination could require redemption of public shares and liquidation; warrants could expire worthless.
Risks, contingencies, and controls
- Management said COVID-19 could adversely affect the company’s financial position, operations, or target search, but the specific impact was not determinable.
- Trust assets could be exposed to third-party claims. An affiliated entity agreed to indemnify against certain claims that reduce trust proceeds below $10.15 per share, but the company had not verified its ability to meet that obligation and did not believe it had significant liquid assets.
- The filing reported effective disclosure controls as of September 30 and no material changes in internal control over financial reporting during the period.
- The cover page marks “No” for whether all required Exchange Act reports had been filed during the relevant period; investors should verify the context and filing history.
Important facts to verify
- Confirm whether this is the intended filing: it is for Legato Merger Corp. II, not Southland Holdings, Inc.
- Verify the post-quarter IPO, over-allotment, trust-account balance, and cash available outside the trust against subsequent filings.
- Review the combination deadline, redemption terms, underwriting fees, and related-party indemnity and note disclosures.
- Confirm the reporting-history checkbox and whether any later filings or events changed the liquidity and business-combination outlook.