Company: LEGT
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001829126-25-001098
Chunk: 23

Company: Legato Merger Corp. III
Filing Date: 2025-02-19
Form: 10-K
Item: Item 1
Chunk 23
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 connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per ordinary share 

    ●
    the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and 

    ●
    the Market Value is below $9.20 per share, 

then the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the price at which we issue the additional ordinary shares or equity-linked securities. This may make it more difficult for us to consummate an initial business combination with a target business.

15

We may issue shares or debt securities to complete a business combination, which would reduce the equity interest of our shareholders and likely cause a change in control of our company.

As of the date of this annual report, our amended and restated memorandum and articles of association authorizes the issuance of up to 200,000,000 ordinary shares, par value $0.0001 per share, and 1,000,000 preference shares, par value $0.0001 per share. Following our IPO and the purchase of the Private Placement Units, there were 163,860,312 authorized but unissued ordinary shares available for issuance (after appropriate reservation for the issuance of the shares underlying the public and private warrants). We may issue a substantial number of additional ordinary shares or preference shares, or a combination of ordinary shares and preference shares, to complete a business combination. The issuance of additional ordinary shares will not reduce the per-share conversion amount in the trust account. The issuance of additional ordinary shares or preference shares:

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    may significantly reduce the equity interest of investors in our IPO; 

    ●
    may subordinate the rights of holders of ordinary shares if we issue preference shares with rights senior to those afforded to our ordinary shares; 

    ●
    may cause a change in control if a substantial number of ordinary shares are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; and 

    ●
    may adversely affect prevailing market prices for our ordinary shares. 

Similarly, if we issue debt securities, it could result in:

    ●
    default and foreclosure