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Related Party Transactions | 4 Months Ended
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Mar. 31, 2025
Related Party Transactions |
Related Party Transactions | Note 4 — Related Party Transactions Founder Shares On November 26, 2024, Rithm Acquisition Corp Sponsor LLC paid $25,000 to cover certain of the Company’s expenses in exchange for the issuance of 5,750,000 Class B ordinary shares, par value $0.0001 (the “Founder Shares”). The Sponsor has agreed to forfeit up to 750,000 Founder Shares to the extent that the over-allotment option is not exercised in full by the underwriters. The forfeiture will be adjusted to the extent that the over-allotment option is not exercised in full by the underwriters so that the Founder Shares will represent 19.8% of the Company’s issued and outstanding ordinary shares (excluding the Private Placement Units and assuming the initial shareholders do not purchase any Public Shares in the Initial Public Offering) after the Initial Public Offering. On February 27, 2025, the underwriters exercised their over-allotment option in full as part of the closing of the Initial Public Offering. As such, the 750,000 Founder Shares are no longer subject to forfeiture. The Sponsor is holding 5,675,000 Founder Shares, after giving effect to the Founder Share transfers described below. In January and February 2025, the Sponsor transferred a total of 75,000 Founder Shares to the three independent director nominees (25,000 shares each) for an aggregate consideration of $0.004 per share, or an aggregate total amount of $326. The Founder Shares will be returned to the Sponsor if the holder of such Founder Shares is no longer serving as a director on the Company’s board of directors prior to the initial Business Combination. The transfer of the Founder Shares to the three independent director nominees are in the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the Founder Shares granted to the Company’s independent directors was $123,600 or $2.47 per share for the 50,000 shares transferred in January 2025, and $61,828 or $2.47 per share for the 25,000 shares transferred in February 2025. The Founder Shares were granted subject to a performance condition (i.e., providing services through Business Combination). Stock-based compensation would be recognized at the date a Business Combination is considered probable (i.e., upon consummation of a Business Combination) in an amount equal to the number of Founder Shares that ultimately vest times the grant date fair value per share (unless subsequently modified) less the amount initially received for the purchase of the Founder Shares. As of February 28, 2025, the Company determined that the initial Business Combination is not considered probable and therefore no compensation expense has been recognized. Subject to limited exceptions, the initial shareholders agreed not to transfer, assign or sell any Founder Shares until the earlier to occur of: (A) 180 days after the completion of the initial Business Combination and (B) subsequent to the initial Business Combination, the date on which the Company completes a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of the Public Shareholders having the right to exchange their ordinary shares for cash, securities or other property. Private Placement Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 660,000 Private Placement Units, at a price of $10.00 per Private Placement Unit, in a private placement. The Private Placement Units are identical to the Units sold in the Initial Public Offering. If the Company does not consummate an initial Business Combination within the Combination Period, any proceeds from the sale of the Private Placement Units held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law). Holders of the Private Placement Units have entered into an agreement, pursuant to which they have agreed to waive their redemption rights with respect to their Founder Shares, Private Placement Shares included in any Private Placement Units and Public Shares in connection with (i) the completion of the initial Business Combination and (ii) the implementation by the directors of, following a shareholder vote to approve, an amendment to the amended and restated memorandum and articles of association (A) that would modify the substance or timing of the obligation to provide holders of the Class A ordinary shares the right to have their shares redeemed or repurchased in connection with the initial Business Combination or to redeem 100% of the Public Shares if the Company does not complete the initial Business Combination within the Combination Period or (B) with respect to any other provision relating to the rights of holders of the Class A ordinary shares. Subject to limited exceptions, the Private Placement Units (including any Private Placement Shares or Private Placement Warrants included in such Private Placement Units) will not be transferable or salable until 30 days after the completion of the initial Business Combination. Certain proceeds from the Private Placement Units will be added to the proceeds from the Initial Public Offering to be held in the Trust Account. Related Party Loans On November 26, 2024, Rithm Acquisition Corp Sponsor LLC agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to a promissory note (the “Note”). This loan was non-interest bearing and payable on the earlier of June 30, 2026 or the completion of the Initial Public Offering. On March 4, 2025, the Company repaid the outstanding borrowings under the Note. Borrowings under the note are no longer available. Due to Sponsor Due to Sponsor represents payments made by the Sponsor on behalf of the Company that were not covered by the Promissory Note agreement. As of March 31, 2025, Due to Sponsor balance amounted to $39,882. Working Capital Loans In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company may repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans may be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of the proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1.5 million of such Working Capital Loans may be convertible into shares of the post Business Combination entity at a price of $10.00 per unit. The Private Placement Units issued upon conversion of any such loans would be identical to the Private Placement Units sold in the private placement concurrently with the Initial Public Offering. As of March 31, 2025, the Company had no outstanding borrowings under the Working Capital Loans. Administrative Support Agreement The Company entered into an agreement with the Sponsor, commencing on February 26, 2025 through the earlier of the Company’s consummation of initial Business Combination and its liquidation, to pay the Sponsor an aggregate of $20,000 per month for office space, secretarial and administrative support services. For the three months ended March 31, 2025 and for the period from November 21, 2024 (inception) through March 31, 2025, the Company incurred $20,000 in fees for these services, which was unpaid and included in accrued expenses line in the accompanying condensed balance sheet.

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