10-Q: Live Oak Acquisition V Reports Q3 2025 Results

Live Oak Acquisition Corp. V, a SPAC, reported a net income of $2.1 million for Q3 2025, driven by interest income from its $236.7 million trust account, while continuing its search for a business combination.

Summary

• Live Oak Acquisition Corp. V (LOKV) is a blank check company (SPAC) incorporated on November 27, 2024, with its Initial Public Offering (IPO) completed on March 3, 2025.
• The company reported a net income of $2,108,631 for the three months ended September 30, 2025, primarily due to $2,447,954 in interest earned on marketable securities held in its Trust Account.
• For the nine months ended September 30, 2025, the company recorded a net loss of $2,096,971, influenced by $7,705,311 in operating costs, including a $6,900,000 deferred advisory fee, offset by $5,608,340 in Trust Account interest income.
• As of September 30, 2025, the Trust Account held $236,758,340 in marketable securities, and the company had $1,949,131 in cash and cash equivalents outside the Trust Account.
• The company has until December 3, 2026 (or March 3, 2027 under certain conditions) to complete an initial Business Combination.
• Jonathan R. Furer resigned as a director and chair of the compensation committee on June 1, 2025.

Sentiment

Score: 6

Explanation: The company is performing as expected for a SPAC in its pre-combination phase, generating interest income from its trust account while incurring operational costs. The financial deficit is largely due to deferred fees that will only be paid upon a successful business combination. The primary uncertainty remains the successful identification and completion of a suitable target within the deadline, which is inherent to the SPAC model.

Positives

• Generated $2,447,954 in interest income from the Trust Account for the three months ended September 30, 2025, contributing to a net income of $2,108,631 for the quarter.
• The Trust Account balance has grown to $236,758,340 as of September 30, 2025, from the initial $231,150,000, indicating effective management of trust assets.
• Disclosure controls and procedures were evaluated as effective as of September 30, 2025.
• The promissory note from the Sponsor for IPO expenses has been fully repaid ($176,573).

Negatives

• Reported a net loss of $2,096,971 for the nine months ended September 30, 2025, primarily due to significant operating costs, including a $6,900,000 deferred advisory fee.
• Total Shareholders (Deficit) Equity stands at $(12,072,030) as of September 30, 2025, a substantial increase from $6,429 at December 31, 2024.
• The company expects to incur increased expenses as a public company and for due diligence in its pursuit of an acquisition.
• The Sponsor's ability to satisfy its indemnity obligations for claims reducing the Trust Account below $10.05 per public share cannot be assured, as the Sponsor's only assets are believed to be company securities.

Risks

• Ability to complete an initial Business Combination may be adversely affected by various factors beyond the company's control, including changes in laws or regulations, financial market downturns, economic conditions, inflation, interest rate fluctuations, tariffs, supply chain disruptions, declines in consumer confidence, public health considerations, and geopolitical instability (e.g., military conflicts in Ukraine and the Middle East).
• Failure to complete an initial Business Combination within the Combination Period (by December 3, 2026, or March 3, 2027) will result in the redemption of public shares and liquidation.
• The proceeds deposited in the Trust Account could become subject to claims of the company's creditors, which could have priority over public shareholders' claims.
• If the company seeks to extend the Combination Period, it would require public shareholder approval, potentially leading to redemptions that decrease the Trust Account and capitalization, affecting Nasdaq listing.
• Failure to meet the Nasdaq 36-Month Requirement (complete Business Combination within 36 months of IPO effectiveness) will likely lead to suspension of trading and delisting from Nasdaq.
• The company may have insufficient funds available to operate its business prior to a Business Combination if estimates of costs for identifying a target, due diligence, and negotiation are less than actual amounts.
• The company may need additional financing either to complete its Business Combination or if a significant number of public shares are redeemed, potentially through issuing additional securities or incurring debt.
• The Sponsor's indemnity obligations for Trust Account shortfalls cannot be assured, as the Sponsor's only assets are believed to be company securities.

Future Outlook

The company continues to seek an initial Business Combination, with a deadline of December 3, 2026, or potentially March 3, 2027, if a definitive agreement is signed. It anticipates incurring increased expenses as a public company and for due diligence. Management acknowledges the possibility of needing additional financing to complete a Business Combination or cover significant redemptions. The company may liquidate Trust Account investments into cash to mitigate Investment Company Act risks.

Management Comments

• "We intend to use the funds held outside the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination."
• "We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business."
• "Our Management Team concluded that our disclosure controls and procedures were effective as of September 30, 2025."

Industry Context

Live Oak Acquisition Corp. V operates as a Special Purpose Acquisition Company (SPAC), a trend that gained significant momentum in recent years. SPACs raise capital through an IPO with the sole purpose of acquiring an existing private company, taking it public. The reported interest income from the Trust Account is typical for a SPAC in its pre-combination phase, as funds are held in low-risk, interest-bearing securities. The significant deferred fees (underwriting and advisory) are standard for SPACs, becoming payable upon the successful completion of a business combination. The challenges and risks highlighted, such as the deadline for a business combination and potential delisting from Nasdaq, are inherent to the SPAC model and reflect the current regulatory and market scrutiny on these vehicles. The resignation of a director is also not uncommon in the lifecycle of a SPAC as it progresses towards a target.

Comparison to Industry Standards

• NA

Management Changes

Corporate Governance

Legal Proceedings

• No material litigation currently pending or contemplated against the company, its officers, or directors.

Related Party Transactions

• Sponsor (Live Oak Sponsor V, LLC) initially purchased 5,750,000 founder shares for $25,000.
• Sponsor purchased 4,500,000 Private Placement Warrants for $4,500,000.
• Sponsor loaned the company up to $300,000 for IPO expenses, of which $176,573 has been repaid.
• The company pays the Sponsor or an affiliate $17,500 per month for administrative services (office space, utilities, secretarial support).
• The company covered certain expenses on behalf of its Sponsor, resulting in $713 due from the Sponsor.
• Sponsor, officers, and directors have agreed to waive redemption rights for founder shares and public shares under certain conditions and vote in favor of the initial Business Combination.
• Sponsor may provide Working Capital Loans up to $1,500,000, convertible into Private Placement Warrants.

Stakeholder Impact

• Shareholders (Public): Entitled to redemption rights if a Business Combination is not completed or if certain amendments to the memorandum are approved. Their investment is held in a Trust Account, earning interest. They face the risk of liquidation if no Business Combination is found, or dilution if additional securities are issued for a Business Combination.
• Shareholders (Sponsor/Initial): Hold founder shares and Private Placement Warrants, subject to lock-up periods. They have waived redemption rights for founder shares and certain voting rights prior to a Business Combination. They bear the primary risk of the SPAC failing to find a target, as their investment in founder shares and private warrants would likely become worthless.
• Creditors: Trust Account proceeds could become subject to creditor claims, potentially having priority over public shareholders.
• Underwriters: Entitled to a deferred underwriting discount of $6,900,000 upon completion of a Business Combination, based partly on amounts remaining in the Trust Account after redemptions.
• Santander US Capital Markets LLC: Entitled to a $6,900,000 advisory fee upon closing of a Business Combination.
• Employees (Management Team): Their compensation and future prospects are tied to the successful completion of a Business Combination.

Next Steps

• Continue to identify and evaluate target businesses for a Business Combination.
• Perform business due diligence on prospective target businesses.
• Structure, negotiate, and complete a Business Combination within the Combination Period (by December 3, 2026, or March 3, 2027).
• File a post-effective amendment to the IPO registration statement or a new registration statement covering Class A ordinary shares issuable upon warrant exercise within 20 business days after the Business Combination closing, aiming for effectiveness within 60 business days.
• Maintain a current prospectus for warrant exercisable shares until warrant expiration.
• Potentially seek shareholder approval to extend the Combination Period if needed.

Key Dates

Recommendation

Live Oak Acquisition Corp. V is a pre-combination SPAC, and its current financial performance (net income from interest, operating loss from expenses) is typical for this stage. The primary value driver for a SPAC is the successful identification and execution of a compelling business combination. While the company has a substantial trust account and is actively searching, the inherent risks of a SPAC (deadline pressure, potential for no deal, dilution, delisting) remain. Without a specific target identified, there's no fundamental business to evaluate for a "buy" or "sell" recommendation beyond the SPAC structure itself. A "hold" recommendation reflects the speculative nature of SPACs at this stage, awaiting a definitive business combination announcement which would then warrant a re-evaluation based on the target company's fundamentals. The current price reflects the trust value plus a premium/discount based on market sentiment towards the management team and the SPAC sector.

Keywords

SPAC, Blank Check Company, Live Oak Acquisition Corp. V, LOKV, 10-Q, Quarterly Report, Business Combination, Trust Account, Warrants, IPO, Financial Results, SEC Filing, Corporate Governance, Risk Factors, Nasdaq Listing