References
in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Kairous
Acquisition Corp. Limited. References to our “management” or our “management team” refer to our officers and
directors, and references to the “Sponsor” refer to Kairous Asia Limited. The following discussion and analysis of the Company’s
financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements
and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set
forth below includes forward-looking statements that involve risks and uncertainties.
Overview
We
are a blank check company, incorporated on March 24, 2021, as a Cayman Islands exempted company. We were incorporated for the purpose
of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or
more businesses, which we refer to throughout this Quarterly Report as our “initial business combination”. We intend to effectuate
our initial business combination using cash from the proceeds of our initial public offering (the “Initial Public Offering”)
and the private placement of the Private Placement Units (as defined below), the sale of certain forward purchase securities, our shares
(other backstop agreements we may enter into following the consummation of the Initial Public Offering or otherwise), securities, debt
or a combination of cash, equity and debt.
We
held our annual meeting of shareholders on December 2, 2022 (the “2022 Annual Meeting”). During the 2022 Annual Meeting,
shareholders approved, among other things, (x) the Amended and Restated Memorandum and Articles of Association to extend the date by
which the Company has the right to extend the time to complete a business combination eight (8) times, as follows: (i) two (2) times
for an additional three (3) months each time from December 16, 2022 to June 16, 2023 for each three-month extension, followed by (ii)
six (6) times for an additional one (1) month each time from June 16, 2023 to December 16, 2023 for each one-month extension; (y) an
amendment to the Company’s investment management trust agreement, dated December 13, 2021, by and between the Company and Continental
Stock Transfer & Trust Company to extend the time to complete a business combination eight (8) times, as follows: (i) two (2) times
for an additional three (3) months each time from December 16, 2022 to June 16, 2023 by depositing $360,000 to the trust account for
each three-month extension, followed by (ii) six (6) times for an additional one (1) month each time from June 16, 2023 to December 16,
2023 by depositing $120,000 to the trust account for each one-month extension; and (z) elected all of the six nominees for directors
to serve until the next annual meeting of shareholders approved.
On
September 25, 2024, the Company entered into an amended and restated agreement and plan of merger (as it may be amended, supplemented,
or otherwise modified from time to time, the “A&R Merger Agreement”), by and among the Company, Purchaser, Merger Sub,
the Principal Shareholders, and Bamboo Mart, pursuant to which (a) the Company will be merged with and into Purchaser (the “Reincorporation
Merger”), with Purchaser surviving the Reincorporation Merger, and (b) Merger Sub will be merged with and into Bamboo Mart (the
“Acquisition Merger”), with Bamboo Mart surviving the Acquisition Merger as a direct wholly owned subsidiary of Purchaser
(collectively, the “Proposed Business Combination”). Following the Proposed Business Combination, Purchaser will be a publicly
traded company. The closing of the Proposed Business Combination shall occur no later than March 31, 2025.
On
December 14, 2024, the Company entered into an amended and restated agreement and plan of merger (as it may be amended, supplemented,
or otherwise modified from time to time, the “A&R Merger Agreement II”), by and among the Company, Purchaser, Merger
Sub, the Principal Shareholders, and Bamboo Mart, pursuant to which (a) the Company will be merged with and into Purchaser (the “Reincorporation
Merger”), with Purchaser surviving the Reincorporation Merger, and (b) Merger Sub will be merged with and into Bamboo Mart (the
“Acquisition Merger”), with Bamboo Mart surviving the Acquisition Merger as a direct wholly owned subsidiary of Purchaser
(collectively, the “Proposed Business Combination”). Following the Proposed Business Combination, Purchaser will be a publicly
traded company. The closing of the Proposed Business Combination shall occur no later than June 16, 2025.
On
May 9, 2025, the Company entered into an amended and restated agreement and plan of merger (as it may be amended, supplemented, or otherwise
modified from time to time, the “A&R Merger Agreement III”), by and among the Company, Purchaser, Merger Sub, the Principal
Shareholders, and Bamboo Mart, pursuant to which (a) the Company will be merged with and into Purchaser (the “Reincorporation Merger”),
with Purchaser surviving the Reincorporation Merger, and (b) Merger Sub will be merged with and into Bamboo Mart (the “Acquisition
Merger”), with Bamboo Mart surviving the Acquisition Merger as a direct wholly owned subsidiary of Purchaser (collectively, the
“Proposed Business Combination”). Following the Proposed Business Combination, Purchaser will be a publicly traded company.
The closing of the Proposed Business Combination shall occur no later than September 30, 2025. On May 16, 2025, the Company failed to properly extend the business combination
period to June 16, 2025, as it did not deposit $50,000 to the trust account in order to extend the date by which it must consummate an
initial business combination (the “Termination Date”) to beyond May 16, 2025. The Company is in process of liquidating
the trust account and redeeming the Public Shares and the Business Combination is terminated.
3
On
December 14, 2022, we issued an unsecured promissory note, in an amount of $360,000 (the “Extension Note No.1”) to Kairous
Asia Limited, the Company’s initial public offering sponsor (“Sponsor”) in exchange for Sponsor depositing such amount
into the Company’s trust account in order to extend the amount of time it has available to complete a business combination until
March 16, 2023. On March 10, 2023, we issued an unsecured promissory note, in an amount of $360,000 to the Sponsor (the “Extension
Note No.2”, together with Extension Note No.1, the “Extension Notes”) in exchange for Sponsor depositing such amount
into the Company’s trust account in order to further extend the amount of time it has available to complete a business combination
until June 16, 2023. The March Note may be converted, at the lender’s discretion, into additional ordinary shares. The Extension
Notes were amended on May 10, 2023 to provide that the each of the Extension Notes will be converted upon completion of a Business Combination
into the Company’s ordinary shares at a price of $10.10 per share. In the event that a Business Combination does not close by June
16, 2023, as such deadline may be further extended, the Extension Notes shall be deemed to be terminated and no amounts will thereafter
be due thereon.
As
approved by our shareholders at the Annual Meeting of Shareholders on December 14, 2023, we entered into an amendment, dated December
15, 2023 (the “Trust Amendment”) to the investment management trust agreement, dated December 13, 2021, as amended on December
7, 2022, with Continental Stock Transfer & Trust Company. Pursuant to the Trust Amendment, the Company has the right to extend the
time to complete a business combination twelve (12) times for an additional one (1) month each time from December 16, 2023 to December
16, 2024 by depositing into the trust account $50,000 for each one-month extension. On December 15, 2023 through November 16, 2024, the
Company issued 12 unsecured promissory notes, each in an amount of $50,000, to the Sponsor in exchange for Sponsor depositing such amount
into the Company’s trust account in order to extend the amount of time it has available to complete a business combination until
December 16, 2024.
As
further approved by our shareholders at the Annual Meeting of Shareholders on December 6, 2024, we entered into an amendment, dated December
16, 2024 (the “Trust Amendment”) to the investment management trust agreement, dated December 13, 2021, as amended on December
7, 2022 and December 15, 2023, with Continental Stock Transfer & Trust Company. Pursuant to the Trust Amendment, the Company has
the right to extend the time to complete a business combination six (6) times for an additional one (1) month each time from December
16, 2024 to June 16, 2025 by depositing into the trust account $50,000 for each one-month extension. On December 16, 2024 through April,
2025, the Company issued five unsecured promissory notes, each in an amount of $50,000, to the Sponsor in exchange for Sponsor depositing
such amount into the Company’s trust account in order to extend the amount of time it has available to complete a business combination
until May 16, 2025. On May 16, 2025, the Company failed
to properly extend the business combination period to June 16, 2025, as it did not deposit $50,000 to the trust account in order to extend
the date by which it must consummate an initial business combination (the “Termination Date”) to beyond May 16, 2025. Under
the Company’s Fourth Amended and Restated Memorandum and Articles of Association (the “Charter”), if the Company does
not consummate an initial business combination by the Termination Date, the Company is required to (i) immediately commence a wind down
of operations, (ii) as promptly as reasonably possible but not more than ten business days thereafter, liquidate the Trust Account and
redeem all of the outstanding public ordinary shares (“Public Shares”) that were included in the units issued in its initial
public offering, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s
remaining members and the directors, liquidate and dissolve.
The
Company is in process of liquidating the trust account and redeeming the Public Shares. The proceeds of the trust account are now
held in a trust operating account at Citibank, N.A, for the purpose of disbursement to the holders of the Public Shares. Record holders
will receive their pro rata portion of the proceeds of the trust account by delivering their Public Shares to Continental Stock Transfer
& Trust Company, the Company’s transfer agent.
The board of directors of the Company
intends to seek to amend the Charter to remove the obligation to liquidate and dissolve the Company, such that the Company may remain
listed on the OTC Markets and allow it to seek alternative opportunities, including potentially a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business combination with one or more businesses.