8-K: Oak Woods Acquisition Corporation Faces Nasdaq Delisting Threat Over Delayed Quarterly Report, Secures Business Combination Extension

Oak Woods Acquisition Corporation received a Nasdaq delisting notification due to its delayed Q1 2025 financial report, while simultaneously extending its business combination deadline until June 28, 2025.

Summary

• Oak Woods Acquisition Corporation received a notice from Nasdaq on May 27, 2025, for non-compliance with Listing Rule 5250(c)(1) due to the delayed filing of its Quarterly Report on Form 10-Q for the period ended March 31, 2025.
• The company has 60 calendar days to submit a compliance plan to Nasdaq, which, if accepted, could grant an exception for up to 180 calendar days, until November 17, 2025, to regain compliance.
• The delay in filing the 10-Q is not due to any disagreement with the company's auditors, and the company expects to file it promptly upon completion of the audit review process.
• The company's shareholders voted on March 20, 2025, to extend the deadline to complete its initial business combination until September 28, 2025, by permitting up to six one-month extensions, each requiring a $172,500 deposit into the Trust Account by the Sponsor.
• As of May 30, 2025, the Sponsor has timely deposited all prior monthly extension deposits and an additional $172,500, extending the business combination deadline to June 28, 2025. This is the third of six permitted extensions.

Sentiment

Score: 3

Explanation: The company is facing a significant compliance issue with Nasdaq due to a delayed financial filing, which carries the risk of delisting. While they are working to resolve it and have secured an extension for their business combination, the overall situation indicates operational challenges and uncertainty for investors.

Positives

• The delay in filing the Form 10-Q is explicitly stated not to be due to any disagreement with the company's auditors, suggesting a procedural rather than substantive issue.
• The company is actively working diligently with its independent registered public accounting firm to complete the audit review and expects to file the Form 10-Q promptly.
• The company successfully secured an extension for its initial business combination deadline until June 28, 2025, through timely deposits by its Sponsor, providing more time to complete a merger.
• The Nasdaq notification does not immediately impact the company's listing on The Nasdaq Capital Market.

Negatives

• Oak Woods Acquisition Corporation received a formal notice of non-compliance from Nasdaq for failing to timely file its Quarterly Report on Form 10-Q for the period ended March 31, 2025.
• Failure to regain compliance within the specified timeframe (up to November 17, 2025) could lead to the delisting of the company's securities from Nasdaq.
• The company is a blank check company (SPAC) and has not yet completed its initial business combination, requiring multiple extensions.

Risks

• Risk of delisting from Nasdaq if the company fails to timely file its Quarterly Report on Form 10-Q and regain compliance with Nasdaq Listing Rule 5250(c)(1) by November 17, 2025.
• Uncertainty regarding the completion of the initial business combination, as the company has already utilized multiple extensions.
• Reliance on the Sponsor to make timely deposits of $172,500 for each monthly extension to the business combination deadline.

Future Outlook

The company expects to file its Quarterly Report on Form 10-Q promptly upon completion of the audit review process. The initial business combination deadline has been extended to June 28, 2025, with potential for further extensions until September 28, 2025, contingent on timely sponsor deposits.

Management Comments

• "The Company is currently in the final stages of completing work on its 10-Q for the quarter ended March 31, 2025."
• "While the Company has not yet filed its Quarterly Report on Form 10-Q, it is working diligently with its independent registered public accounting firm to complete the remaining audit procedures."
• "The delay in filing is not due to any disagreement with the Companys auditors and the Company expects to file the Form 10-Q promptly upon completion of the audit review process."
• Lixin Zheng, Chief Executive Officer, signed the report on behalf of the company.

Industry Context

Oak Woods Acquisition Corporation is a Special Purpose Acquisition Company (SPAC), a blank check company formed to raise capital via an IPO with the purpose of acquiring an existing company. SPACs typically have a limited timeframe (often 18-24 months) to complete a business combination, and extensions are common but often require shareholder approval and sponsor contributions. Delays in financial reporting and non-compliance with listing rules are significant issues for any publicly traded company, especially SPACs, as they can erode investor confidence and complicate the search for a target company.

Comparison to Industry Standards

• The Nasdaq Listing Rule 5250(c)(1) requiring timely filing of periodic financial reports is a standard compliance requirement for all listed companies, not unique to SPACs.
• The 60-day period to submit a compliance plan and the potential 180-day exception period are standard Nasdaq procedures for addressing such deficiencies.
• SPACs frequently seek extensions for their business combination deadlines, often involving sponsor contributions to the trust account, which is a common practice in the SPAC industry. However, repeated extensions and non-compliance issues can signal underlying difficulties in identifying or closing a suitable merger target compared to more successful SPACs that complete combinations within initial timelines.

Corporate Governance

Related Party Transactions

• The Sponsor of Oak Woods Acquisition Corporation is making monthly deposits of $172,500 into the Trust Account to extend the deadline for completing the initial business combination.

Stakeholder Impact

• Shareholders: Face uncertainty regarding the company's Nasdaq listing status and the successful completion of a business combination. The value of their shares (Units, Class A Ordinary Shares, Rights, Warrants) could be negatively impacted by delisting or failure to complete a merger.
• Potential Merger Target: The delayed financial filing and Nasdaq non-compliance could complicate negotiations or due diligence for a potential business combination target.
• Creditors: While not directly mentioned, any financial instability or delisting could indirectly affect perceptions of creditworthiness.

Next Steps

• Oak Woods Acquisition Corporation must submit a plan to Nasdaq within 60 calendar days to regain compliance with listing rules.
• The company needs to promptly file its Quarterly Report on Form 10-Q for the period ended March 31, 2025, upon completion of the audit review process.
• The company must complete its initial business combination by June 28, 2025, or secure further extensions through additional sponsor deposits.

Key Dates

Recommendation

Keywords

SPAC, Special Purpose Acquisition Company, 8-K, SEC filing, Nasdaq, delisting notice, Form 10-Q, quarterly report, financial compliance, business combination, merger, extension, Oak Woods Acquisition Corporation, OAKU