0001410578-25-001813
SEC filingSPAC with no operations; net loss widened due to warrant liability losses and higher expenses.
For the three months ended June 30, 2025, the company reported a net loss of $1.6 million, compared to a net loss of $505.0 thousand in the same period of 2024. The increase was primarily due to a $1.2 million loss on the change in fair value of warrant liability (versus $331.5 thousand loss in 2024), partially offset by a decline in dividend income from trust account securities ($4.5 thousand vs $163.6 thousand). Operating expenses rose sharply: legal and accounting fees increased to $170.7 thousand from $82.8 thousand, administrative expenses doubled to $142.2 thousand, and insurance fell to $25.7 thousand from $80.1 thousand.
For the six months ended June 30, 2025, net loss was $1.7 million versus $243.4 thousand in the prior year period. The swing was driven by a $1.2 million loss on warrant liability (compared to a $116.5 thousand gain in 2024) and higher professional fees, though offset by a $723.5 thousand dividend income decline to $9.0 thousand in 2025. A non-redemption agreement expense of $275.0 thousand in 2024 did not recur.
As a blank-check company with no operating revenues, the company does not report business segments. All activity relates to formation, IPO, and pursuit of a business combination.
Management's outlook centers on completing the proposed business combination with Angel Studios, Inc. under the Merger Agreement signed September 11, 2024, as amended. The closing deadline is September 30, 2025. The company faces liquidity risk: cash outside trust was only $328.6 thousand as of June 30, 2025, with a working capital deficit of $4.4 million. A Sponsor promissory note of up to $1.0 million partially funds ongoing costs, but management acknowledges substantial doubt about the ability to continue as a going concern. No revenue guidance is provided, as the company will not generate operating income until after the business combination.
As of June 30, 2025, the Company held $328,610 in cash and $438,166 in marketable securities in the Trust Account. The working capital deficit stood at $4,370,038, reflecting current liabilities of $4,782,172 against current assets of $412,134. The Company had a promissory note – related party of $814,146, and total liabilities exceeded total assets, resulting in a stockholders’ deficit of $10,167,888. Management has expressed substantial doubt about the Company’s ability to continue as a going concern within one year from the issuance of these financial statements, citing insufficient working capital and reliance on sponsor contributions or business combination consummation.
The Company has no material purchase commitments. Under the underwriting agreement, the deferred underwriting fee of $8,050,000 was waived in August 2022. The Company has a administrative support agreement with the Sponsor requiring $15,000 per month, with $501,500 accrued as of June 30, 2025. The non-redemption agreements resulted in the transfer of Class B shares; no further obligations remain. The Sponsor Promissory Note of up to $1,000,000 is non-interest bearing and payable upon business combination or September 30, 2025, with $814,146 drawn.
The Company did not repurchase shares, pay dividends, or incur capex during the period. Sponsor capital contributions of $1,444,227 have been received cumulatively, with none in the current quarter. Financing activities included $375,142 drawdowns on the Sponsor Promissory Note. No other capital allocation actions are disclosed.
The Company operates as a single segment: a blank check company formed to effect a business combination. The CODM uses consolidated net loss to assess performance and allocate resources. No geographic or product-level breakdown is provided.
Operating cash flow (CFO) was negative at $(533,984), but improved significantly from $(1,833,885) in the prior period. The primary driver of the improvement was a reduction in accounts payable and accrued expenses outflows ($1.7M prior vs $171K current) and changes in warrant liabilities. Net loss more than doubled to $(1.6M) due to a $1.2M non-cash expense from the change in fair value of warrant liabilities, which actually benefited CFO (add-back).
Investing cash flow was negligible at $(7,522) for purchases of marketable securities, a stark contrast to the prior period's $32M inflow from trust account liquidations. Financing activities provided $375K from related-party promissory note drawdowns, offsetting some of the operating and investing cash outflows.
The company ended with $328,610 in cash, down from $494,974 at the start. No capital expenditures, share repurchases, or dividends were reported, as it is a pre-revenue SPAC. Free cash flow is not meaningful due to the lack of Capex; the negative CFO indicates ongoing cash consumption.