Four Leaf Acquisition Corp. Reports Decrease in Net Income and Faces Delisting Risks

Four Leaf Acquisition Corp. (FORL), a blank check company, reported a net income of $403,264 for the fiscal year ended December 31, 2024, compared to $834,785 in 2023. This change primarily reflects a decrease in dividend and interest income from $2,227,437 to $2,219,106, partially offset by a reduction in formation and operating costs from $1,083,245 to $1,363,048. The decrease in dividend and interest income resulted from redemptions of Class A common stock totaling $30,194,356 on June 18, 2024, following a stockholder meeting approving a 12-month extension to the business combination deadline.

Significant changes occurred during the year, including the approval of multiple one-month extensions to the business combination deadline, extending it to May 22, 2025. A total of $825,000 was deposited into the trust account by the sponsor to facilitate these extensions. Furthermore, the company entered into a merger agreement with Xiaoyu Dida Interconnect International Limited on December 17, 2024, subject to various closing conditions including stockholder approval. As of April 29, 2025, 2,722,903 Class A and 1,355,250 Class B shares were outstanding.

Operational developments included the unexpected death of the former CEO, Angel Orrantia, on December 15, 2024, leading to the appointment of Bala Padmakumar as interim CEO. The company also faced delisting notices from Nasdaq due to its market value falling below the minimum requirement and failure to timely file reports. The company has requested an appeal to stay the delisting. The company currently has three executive officers and does not intend to have any full-time employees prior to the completion of an initial business combination.

The company's financial statements reveal a cash balance of $28,407 and a working capital deficit of $3,334,790 as of December 31, 2024. The company has received working capital loans totaling $2,195,100 from its sponsor. The company's financial statements also reflect a material weakness in internal controls over financial reporting related to the review and approval of cash disbursements. The company is implementing measures to remediate this weakness.

The company's outlook is contingent upon the successful completion of its merger with Xiaoyu Dida by May 22, 2025, or June 22, 2025 if the extension is fully exercised. If the merger is not completed, the company will cease operations, redeem shares at a per-share price based on the trust account balance, and liquidate. The company acknowledges several risks, including competition, the potential for insufficient funds to complete a business combination, and the potential impact of the Inflation Reduction Act of 2022 excise tax on stock redemptions.