SPAC ClearThink 1 (CTAA) builds $125.6M trust cash after IPO
ClearThink 1 Acquisition Corp., a newly formed SPAC, reported first-quarter results reflecting its recent initial public offering and cash-rich balance sheet. Total assets were $127,317,753 as of March 31, 2026, including $125,569,810 held in a Trust Account invested in highly liquid securities.
The company generated net income of $414,794 for the quarter, driven by $419,810 of interest income on Trust Account funds and a $203,639 gain from changes in the fair value of its over-allotment derivative, partially offset by $208,655 of formation and operating expenses. Following its February 25, 2026 IPO of 12,500,000 units at $10.00 each, plus 15,000 additional units from a partial over-allotment exercise, ClearThink 1 holds $1,556,851 in cash and working capital of $1,722,262 outside the Trust Account to fund deal search and public company costs while it pursues an initial business combination.
Positive
- None.
Negative
- None.
Key Figures
Key Terms
Trust Account financial
Business Combination financial
Founder Shares financial
Working Capital Loans financial
Public Rights financial
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
For
the quarterly period ended
For the transition period from ____ to _____
Commission
file number:
(Name of Registrant in Its Charter)
| N/A | ||
State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices)
+1
(Registrant’s Telephone Number, Including Area Code)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name
of each exchange on which registered | ||
Indicate
by check whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes ☐
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | |
| Smaller
reporting company |
Emerging
growth company |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
Indicate
the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:
CLEARTHINK 1 ACQUISITION CORP.
TABLE OF CONTENTS
| Page | ||||
| PART I - FINANCIAL INFORMATION: | 1 | |||
| Item 1. | Financial Statements: | 1 | ||
| Condensed Balance Sheets as of March 31, 2026 (unaudited) and December 31, 2025 | 1 | |||
| Unaudited Condensed Statement of Operations for the three months ended March 31, 2026 | 2 | |||
| Unaudited Condensed Statement of Changes in Shareholders’ Equity for the three months ended March 31, 2026 | 3 | |||
| Unaudited Condensed Statement of Cash Flows for the three months ended March 31, 2026 | 4 | |||
| Notes to Unaudited Condensed Financial Statements | 5 | |||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 14 | ||
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 17 | ||
| Item 4. | Controls and Procedures | 17 | ||
| PART II - OTHER INFORMATION: | 18 | |||
| Item 1. | Legal Proceedings | 18 | ||
| Item 1A. | Risk Factors | 18 | ||
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 18 | ||
| Item 3. | Defaults Upon Senior Securities | 18 | ||
| Item 4. | Mine Safety Disclosures | 18 | ||
| Item 5. | Other Information | 18 | ||
| Item 6. | Exhibits | 18 | ||
| Signatures | 19 | |||
| i |
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
CLEARTHINK 1 ACQUISITION CORP.
CONDENSED BALANCE SHEETS
March 31, 2026 |
December 31, | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | $ | - | |||||
| Prepaid expenses | ||||||||
| Total Current Assets | ||||||||
| Deferred offering costs | - | |||||||
| Cash Held in Trust Account | - | |||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Current Liabilities: | ||||||||
| Accrued formation and offering costs | $ | - | $ | |||||
| Accounts payable | - | |||||||
| Sponsor advance | - | |||||||
| Total Current Liabilities | ||||||||
| Commitments and contingencies (Note 6) | - | |||||||
| Class A Ordinary Share, $ | - | |||||||
| Shareholders’ Equity (Deficit): | ||||||||
| Preferred shares, $ | - | - | ||||||
| Class A ordinary shares, $ | - | |||||||
| Class B ordinary shares,
$ | ||||||||
| Ordinary shares, value | ||||||||
| Additional paid-in capital | ||||||||
| Retained Earnings (Accumulated deficit) | ( | ) | ||||||
| Total Shareholders’ Equity (Deficit) | ( | ) | ||||||
| Total Liabilities and Shareholders’ Equity (Deficit) | $ | $ | ||||||
(1)
|
The accompanying notes are an integral part of these unaudited condensed financial statements.
| 1 |
CLEARTHINK 1 ACQUISITION CORP.
UNAUDITED CONDENSED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2026
| Formation and operating expenses | $ | |||
| TOTAL EXPENSES | ( | ) | ||
| Other income | ||||
| Change in fair value of over-allotment derivative liability | ||||
| Interest income earned on cash held in Trust account | ||||
| TOTAL OTHER INCOME | ||||
| Net income | $ | |||
| Weighted average shares outstanding of Class A Ordinary shares, basic and diluted | ||||
| Basic and diluted net income per share, Class A ordinary shares | $ | |||
| Weighted average shares outstanding of Non-redeemable Class A and B Ordinary Shares, basic (1) | ||||
| Basic net income per share, Non-redeemable Class B ordinary shares | $ | |||
| Weighted average shares outstanding of Non-redeemable Class B Ordinary Shares, diluted (1) | ||||
| Diluted net income per share, Non-redeemable Class B ordinary shares | $ |
| (1) |
The accompanying notes are an integral part of these unaudited condensed financial statements.
| 2 |
CLEARTHINK 1 ACQUISITION CORP.
UNAUDITED CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED MARCH 31, 2026
| Shares | Amount | Shares | Amount | Capital | Deficit) | Equity | ||||||||||||||||||||||
| Class A Ordinary Shares | Class B
Ordinary Shares | Additional
Paid-In | Retained Earnings (Accumulated | Shareholders’ Equity | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit) | (Deficit) | ||||||||||||||||||||||
| Balance, December 31, 2025 | - | $ | - | (1) | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||
| Balance | - | $ | - | (1) | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||
| Private placement, proceeds | - | - | - | |||||||||||||||||||||||||
| Public rights, fair value | - | - | - | - | - | |||||||||||||||||||||||
| Offering costs allocated to public rights | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||
| Accretion for Class A ordinary shares subject to possible redemption | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||
| Net income | - | - | - | - | - | |||||||||||||||||||||||
| Balance, March 31, 2026 | $ | $ | $ | $ | $ | |||||||||||||||||||||||
| Balance | $ | $ | $ | $ | $ | |||||||||||||||||||||||
| (1) |
The accompanying notes are an integral part of these unaudited condensed financial statements.
| 3 |
CLEARTHINK 1 ACQUISITION CORP.
UNAUDITED CONDENSED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2026
| Cash Flows Used in Operating Activities: | ||||
| Net income | $ | |||
| Adjustments to reconcile net income to net cash used in operating activities | ||||
| Interest income earned on cash held in Trust account | ( | ) | ||
| Change in fair value of over-allotment derivative liability | ( | ) | ||
| Changes in operating assets and liabilities: | ||||
| Deferred offering costs | ||||
| Prepaid expenses | ( | ) | ||
| Accrued expenses and offering costs | ||||
| Net Cash Used in Operating Activities | ( | ) | ||
| Cash Flows Used in Investing Activities: | ||||
| Cash deposited into Trust | ( | ) | ||
| Cash Flows Used in Investing Activities | ( | ) | ||
| Cash Flows Provided by Financing Activities: | ||||
| Proceeds from issuance of Class A shares | ||||
Repayment to related party, net of advances | ( | ) | ||
| Proceeds from Private Placement | ||||
| Payment of offering costs | ( | ) | ||
| Net Cash Provided by Financing Activities | ||||
| Net change in cash | ||||
| Cash at beginning of period | - | |||
| Cash at end of period | $ | |||
| Supplemental Disclosure of cash flow information: | ||||
| Non-cash investing and financing activities | ||||
| Deferred offering costs included in accrued formation and offering costs | $ | |||
| Prepaid expenses included in accrued formation and offering costs | $ | |||
The accompanying notes are an integral part of these unaudited condensed financial statements.
| 4 |
CLEARTHINK 1 ACQUISITION CORP.
Notes to Unaudited Condensed Financial Statements
NOTE 1 - DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
ClearThink 1 Acquisition Corp. (the “Company”) is a blank check company incorporated as a Cayman Islands exempted company on September 11, 2025. The Company was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (the “Business Combination”).
The Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, however, it intends to focus its search on high potential businesses based in the United States. The Company is an early-stage and emerging growth company; and, as such, the Company is subject to all of the risks associated with early-stage and emerging growth companies.
As of March 31, 2026, the Company had not commenced any operations. All activity for the period from September 11, 2025 (inception) through March 31, 2026, relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of an initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering. The Company has selected December 31 as its fiscal year end.
On
February 25, 2026, the Company consummated its Initial Public Offering of
Simultaneously
with the closing of the Initial Public Offering, the Company completed the private sale of
On
February 26, 2026, the underwriters partially exercised their over-allotment option and purchased an additional
Transaction
costs amounted to $
The
Company’s management has broad discretion with respect to the specific application of the net proceeds of this offering and the
sale of the Private Placement Units, although substantially all of the net proceeds are intended to be applied generally toward consummating
a Business Combination.
| 5 |
The
Company will provide the holders of the outstanding Public Shares (the “Public Shareholders”) with the opportunity to redeem
all or a portion of their Public Shares either (i) in connection with a general meeting called to approve the Business Combination or
(ii) by means of a tender offer in connection with the Business Combination. The decision as to whether the Company will seek shareholder
approval of a Business Combination or conduct a tender offer will be made by the Company. The Public Shareholders will be entitled to
redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $
If
the Company seeks shareholder approval of the Business Combination, the Company will proceed with a Business Combination only if the
Company receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires a resolution be passed
by a majority of the holders of the Class A ordinary shares, par value $
Notwithstanding the foregoing, if the Company seeks shareholder approval of a Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, the Articles provide that a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares without the Company’s prior written consent.
The
Sponsor has agreed (a) to waive its redemption rights with respect to any Founder Shares and Public Shares held by it in connection with
the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association
(i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial
Business Combination or to redeem
If
the Company has not completed a Business Combination within 21 months from the closing of the Initial Public Offering, the Company may
seek shareholder approval to amend its amended and restated memorandum and articles of association to extend the date by which the Company
must consummate its initial Business Combination, provided the Company deposits an additional $
| 6 |
The
Sponsor has agreed to waive its rights to liquidating distributions from the Trust Account with respect to the Founder Shares it will
receive if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor or any of its
respective affiliates acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating
distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters
have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company
does not complete a Business Combination within the Combination Period, and in such event, such amounts will be included with the other
funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution,
it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering
price per Unit ($
In
order to protect the amounts held in the Trust Account, the Sponsor has agreed that it will be liable to the Company if and to the extent
any claims by a third party (other than the Company’s independent registered public accounting firm) for services rendered or products
sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce
the amount of funds in the Trust Account to below the lesser of (i) $
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in unaudited condensed financial statements prepared in accordance with US GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The interim results for the three ended March 31, 2026, are not necessarily indicative of the results to be expected for the year ending December 31, 2026 or for any future periods.
| 7 |
Liquidity and Capital Resources
As
of March 31, 2026, the Company had cash of $
Subsequent to the consummation of the Initial Public Offering, the Company’s liquidity has been satisfied through the net proceeds from the consummation of the Initial Public Offering and the Private Placement held outside of the Trust Account. 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, provide the Company Working Capital Loans (as defined in Note 5).
Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using the funds held outside of the Trust Account for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The
Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company did
| 8 |
Offering Costs
The Company complies with the requirements of the ASC 340-10-S99 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A — “Expenses of Offering.” Offering costs consist principally of professional and registration fees that are related to the Initial Public Offering. Financial Accounting Standards Board (“FASB”) ASC 470-20, “Debt with Conversion and Other Options,” addresses the allocation of proceeds from the issuance of convertible debt into its equity and debt components. The Company applied this guidance to allocate the Initial Public Offering proceeds from the Public Units between Class A ordinary shares and rights, using the residual method by allocating the Initial Public Offering proceeds first to assigned value of the rights and then to the Class A ordinary shares. Offering costs allocated to the Class A ordinary shares subject to possible redemption were charged to temporary equity, and offering costs allocated to the rights included in the Public Units and Private Placement Units were charged to shareholders’ equity as the rights, after management’s evaluation, were accounted for under equity treatment.
As
of March 31, 2026 and December 31, 2025, the Company had deferred offering costs of $
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2026 and December 31, 2025. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
There is currently no taxation imposed on income by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s financial statements.
Net Income per Ordinary Share
The Company complies with accounting and disclosure requirements of ASC 260, “Earnings Per Share.” The Company has two classes of shares, which are referred to as Class A ordinary shares and Class B ordinary shares. Income and losses are shared pro rata between the two classes of shares.
Net income per ordinary share is computed by dividing net income by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture. As of March 31, 2026, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company. Diluted earnings per share differs from basic earnings per share. For diluted earnings per share, the forfeited Class B ordinary shares are considered forfeited at the beginning of the period presented. For basic earnings per share, the forfeited Class B ordinary shares are considered forfeited on the date of forfeiture.
The following table reflects the calculation of basic net income per ordinary share.
SCHEDULE OF BASIC NET INCOME ORDINARY SHARE
| For
the Three Months Ended | ||||
| March 31, 2026 | ||||
| Class A ordinary shares | ||||
| Numerator: Allocation of net income | $ | |||
| Denominator: Weighted average shares outstanding | ||||
| Net income per Class A Ordinary Share | $ | |||
| Class B Non-redeemable ordinary shares | ||||
| Numerator: Allocation of net income | $ | |||
| Denominator: Weighted average shares outstanding | ||||
| Net income per Class B Ordinary Share | $ | |||
The following table reflects the calculation of basic and diluted net income per ordinary share.
| For the Three Months Ended | ||||
| March 31, 2026 | ||||
| Class A ordinary shares | ||||
| Numerator: Allocation of net income | $ | |||
| Denominator: Weighted average shares outstanding | ||||
| Net income per Class A Ordinary Share | $ | |||
| Class B Non-redeemable ordinary shares | ||||
| Numerator: Allocation of net income | $ | |||
| Denominator: Weighted average shares outstanding | ||||
| Net income per Class B Ordinary Share | $ | |||
Cash Held in Trust Account
As
of March 31, 2026 and December 31, 2025, the Company had $
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the balance sheet, primarily due to their short-term nature. As of March 31, 2026, there were no assets or liabilities that qualify as financial instruments.
Fair Value Measurements
Fair value is defined as the price that would be received for sale of an asset or paid to transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
| ● | Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; |
| 9 |
| ● | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and | |
| ● | Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging.” For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statement of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date.
Over-allotment Liability
The over-allotment option is deemed to be a freestanding financial instrument indexed on the contingently redeemable shares and was accounted for as a liability pursuant to the guidance contained in FASB ASC 480, “Distinguishing Liabilities from Equity”.
Rights
The Company accounts for the Public Rights issued in connection with the Public Offering and the Private Placement Rights in accordance with the guidance contained in FASB ASC 815, “Derivatives and Hedging”. Under ASC 815-40, the Public Rights and the Private Placement Rights meet the criteria for equity treatment and as such will be recorded in shareholders’ equity. If the Public Rights and Private Placement Rights no longer meet the criteria for equity treatment, they will record as a liability and remeasured each period with changes recorded in the statement of operations.
Concentration of Credit Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Deposit Insurance Corporation (“FDIC”) limit of $
Class A Ordinary Shares Subject to Redemption
The Public Shares contain a redemption feature which allows for the redemption of such Public Shares in connection with the Company’s liquidation, or if there is a shareholder vote or tender offer in connection with the Company’s initial Business Combination. In accordance with ASC 480-10-S99, the Company classifies public shares subject to redemption outside of permanent equity as the redemption provisions are not solely within the control of the Company. The Company recognizes changes in redemption value immediately as they occur and will adjust the carrying value of redeemable shares to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value. The change in the carrying value of redeemable shares will result in charges against additional paid-in capital (to the extent available) and accumulated deficit. Accordingly, as of March 31, 2026, Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ equity section of the Company’s balance sheet.
As of March 31, 2026, the Class A ordinary shares subject to possible redemption reflected in the balance sheet are reconciled in the following table:
SCHEDULE OF ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION
| Gross proceeds | $ | |||
| Less: Proceeds allocated to public rights | ( | ) | ||
| Less: Proceeds allocated to over-allotment option | ( | ) | ||
| Less: Public shares issuance costs | ( | ) | ||
| Add: Remeasurement of carrying value to redemption value | ||||
| Class A shares subject to possible redemption March 31, 2026 | $ |
Recent Accounting Standards
Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s unaudited condensed financial statements.
NOTE 3 - INITIAL PUBLIC OFFERING
Pursuant
to the Initial Public Offering, the Company sold
| 10 |
NOTE 4 - PRIVATE PLACEMENT
Simultaneously
with the closing of the Initial Public Offering, the Company in a private placement sold to the Sponsor a total of
NOTE 5 - RELATED PARTIES
Founder Shares
On
October 14, 2025, the Sponsor received
Up
to
On
February 26, 2026, the underwriters partially exercised their over-allotment option and purchased an additional
The
founder shares are designated as Class B ordinary shares and, except as described below, are identical to the Class A ordinary shares
included in the units sold in the Initial Public Offering, and holders of founder shares have the same stockholder rights as public stockholders,
except that (i) the founder shares are subject to certain transfer restrictions, as described in more detail below, (ii) the founder
shares are entitled to registration rights; (iii) the initial stockholders, officers, directors and members of the advisory board, pursuant
to a letter agreement with the Company, and the representative of the underwriters, pursuant to the underwriting agreement, have agreed
to (A) waive their redemption rights with respect to their founder shares, private shares and public shares in connection with the completion
of the initial Business Combination, (B) waive their redemption rights with respect to
With certain limited exceptions, the founder shares are not transferable, assignable or saleable (except to officers and directors and other persons or entities affiliated with the Sponsor, each of whom will be subject to the same transfer restrictions) until the completion of the initial Business Combination.
General and Administrative Services
The
Company entered into an agreement, commencing on the effective date of the Initial Public Offering through the earlier of the Company’s
consummation of a Business Combination and its liquidation, to pay the Sponsor or an affiliate thereof a monthly fee of $
Promissory Note - Related Party
The
Sponsor has agreed to loan the Company up to $
Working Capital Loans
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”). Such Working Capital Loans would be evidenced by promissory notes. The notes may be repaid upon completion of
a Business Combination, without interest, or, at the lender’s discretion, up to $
| 11 |
Sponsor Advance
The
Sponsor has funded certain Company expenses. As of March 31, 2026 and December 31, 2025, the outstanding balance was $
NOTE 6 - COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the Founder Shares and Private Placement Units (and the securities comprising such units and any ordinary shares issuable upon conversion of the rights and upon conversion of the Founder Shares) are entitled to registration rights pursuant to the registration rights agreements signed prior to or on the effective date of the Initial Public Offering requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to Class A ordinary shares). The holders of these securities are entitled to make up to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreements provide that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until the securities covered thereby are released from their lock-up restrictions. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The
Company granted the underwriters a 45-day option to purchase up to
The
underwriters were paid an underwriting discount of $
NOTE 7 – SHAREHOLDERS’ EQUITY (DEFICIT)
Preferred
Shares - The Company is authorized to issue
Class
A Ordinary Shares - The Company is authorized to issue
Class
B Ordinary Shares - The Company is authorized to issue
Only holders of the Class B ordinary shares will have the right to vote on the appointment of directors prior to the Business Combination. Holders of ordinary shares will vote together as a single class on all matters submitted to a vote of the Company’s shareholders except as otherwise required by law. In connection with the Company’s initial Business Combination, it may enter into a shareholders agreement or other arrangements with the shareholders of the target or other investors to provide for voting or other corporate governance arrangements that differ from those in effect upon completion of this offering.
The Founder Shares are designated as Class B ordinary shares and will automatically convert at a ratio of one-for-one into Class A ordinary shares (which such Class A ordinary shares delivered upon conversion will not have redemption rights or be entitled to liquidating distributions from the Trust Account if the Company does not consummate an initial Business Combination) at the time of the Company’s initial Business Combination.
Rights
– There were
| 12 |
NOTE 8 - SEGMENT INFORMATION
ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their unaudited condensed financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance.
The
Company’s chief operating decision maker has been identified as the Chief Financial Officer (“CODM”), who reviews the
assets, operating results, and financial metrics for the Company as a whole to make decisions about allocating resources and assessing
financial performance. Accordingly, management has determined that the Company only has
The CODM assesses performance for the single segment and decides how to allocate resources based on net income or loss that also is reported on the statement of operations as net income or loss. The measure of segment assets is reported on the balance sheet as total assets. When evaluating the Company’s performance and making key decisions regarding resource allocation, the CODM reviews several key metrics included in net income or loss and total assets.
Formation and operating expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a Business Combination or similar transaction within the Combination Period. The CODM also reviews formation and operating expenses to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget. Formation and operating expenses, as reported on the statement of operations, are the significant segment expenses provided to the CODM on a regular basis.
Assets and liabilities are reviewed and monitored by the CODM to manage to ensure enough capital is available to support ongoing operations and complete a Business Combination or similar transaction within the Combination Period. Assets and liabilities, as reported on the balance sheet, are the significant assets and liabilities provided to the CODM on a regular basis.
All segment items included in net loss are reported on the statement of operations and described within their respective disclosures.
All segment items are included in assets and liabilities on the balance sheet and described within their respective disclosures.
NOTE 9. FAIR VALUE MEASUREMENTS
The
fair value of the Public Rights issued in the Initial Public Offering is $
The assumptions used to determine the fair value of the Public Rights are as follows:
SCHEDULE OF FAIR VALUE PUBLIC RIGHTS
| February 25, 2026 | ||||
| Market implied share rate value | $ | |||
| Value of Class A Ordinary Share | $ | |||
The
fair value of the underwriters’ over-allotment option issued in the Initial Public Offering is $
The assumptions used to determine fair value of the underwriters’ over-allotment option are as follows:
SCHEDULE OF FAIR VALUE UNDERWRITERS OVER ALLOTMENT OPTION
| February 25, 2026 | ||||
| Term | ||||
| Dividend rate | % | |||
| Risk Free Rate | % | |||
| Volatility | % | |||
NOTE 10 - SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date through May 15, 2026, the date that the unaudited condensed financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the unaudited condensed financial statements, except for the events listed below.
In
connection with the Company’s Initial Public Offering, the Company granted the underwriters a 45-day option to purchase additional
Units to cover over-allotments, if any. The underwriters partially exercised this option on February 26, 2026. Subsequent to March 31,
2026, the underwriters did not exercise the remaining portion of the over-allotment option, and the option expired unexercised at the
end of the 45-day period following the closing of the Initial Public Offering. As a result,
| 13 |
Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward Looking Statements
The following discussion should be read in conjunction with our unaudited condensed financial statements and related notes included in Item 1, “Financial Statements,” of this Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Certain information contained in this MD&A includes “forward-looking statements.” Statements which are not historical reflect our current expectations and projections about our future results, performance, liquidity, financial condition and results of operations, prospects and opportunities and are based upon information currently available to us and our management and their interpretation of what is believed to be significant factors affecting our existing and proposed business, including many assumptions regarding future events. Actual results, performance, liquidity, financial condition and results of operations, prospects and opportunities could differ materially and perhaps substantially from those expressed in, or implied by, these forward-looking statements as a result of various risks, uncertainties and other factors, including those risks described in detail in the section entitled “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025.
The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Report may include, for example, statements about:
| ● | our ability to select an appropriate target business or businesses; | |
| ● | our ability to complete our initial business combination; | |
| ● | our expectations around the performance of the prospective target business or businesses; | |
| ● | our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; | |
| ● | our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination; | |
| ● | our potential ability to obtain additional financing to complete our initial business combination; | |
| ● | our pool of prospective target businesses; | |
| ● | the adverse impacts that events outside of our control, such as increased geopolitical unrest, significant outbreaks of infectious diseases (such as COVID-19) and increased volatility in the debt and equity markets, may have on our ability to consummate an initial business combination; | |
| ● | our public securities’ potential liquidity and trading; | |
| ● | the lack of a market for our securities; | |
| ● | the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; | |
| ● | the trust account not being subject to claims of third parties; or | |
| ● | our financial performance. |
In light of these risks and uncertainties, and especially given the nature of our existing and proposed business, there can be no assurance that the forward-looking statements contained in this section and elsewhere in this Quarterly Report on Form 10-Q will in fact occur. Potential investors should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.
| 14 |
The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors”. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
In addition, statements that contain “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Report. Although we believe that this information provides a reasonable basis for these statements, this information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.
Results of Operations and Known Trends or Future Events
We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities, those necessary to prepare for our initial public offering, and subsequent to our initial public offering, identifying a target company for our initial Business Combination. We do not expect to generate any operating revenues until after completion of our initial Business Combination at the earliest. We generate non-operating income in the form of interest income on cash and cash equivalents held in the trust account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses. For the three months ended March 31, 2026, we had net income of $414,794, which represents interest income earned on cash held in the trust account of $419,810, and the change in the fair value of the overallotment option of $203,639, partially offset by $208,655 in formation and operating costs.
Liquidity and Capital Resources
The Company’s liquidity needs prior to the consummation of our initial public offering were satisfied through the payment of $25,000 from the sponsor upon the issuance of the founder shares, loan proceeds from the sponsor of $500,000 under an unsecured promissory note and advances from related party. Subsequent to the consummation of our initial public offering, the Company’s liquidity has been satisfied through the net proceeds from our initial public offering and the proceeds from the sponsor from the purchase of the private units.
In order to fund working capital deficiencies or 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. If the Company completes a Business Combination, it would repay such loaned amounts at that time. Up to $1,500,000 of such working capital loans may be converted upon completion of a Business Combination into units at a price of $10.00 per unit. Such units would be identical to the private units.
We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account to complete our initial Business Combination. We may withdraw interest to pay our income and franchise taxes, if any. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the trust account. We expect the interest earned on the amount in the trust account will be sufficient to pay our income taxes. To the extent that our equity or debt is used, in whole or in part, as consideration to complete our initial Business Combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
Prior to the completion of our initial Business Combination, we will have available to us the approximately $1,737,168 of proceeds held outside the trust account. We will use these funds to primarily identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination.
| 15 |
We do not believe we will need to raise additional funds following our initial public offering in order to meet the expenditures required for operating our business prior to our initial Business Combination. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial Business Combination. In order to fund working capital deficiencies or finance transaction costs in connection with an intended initial Business Combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete our initial Business Combination, we would repay such loaned amounts. In the event that our initial Business Combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into private units at a price of $10.00 per unit, at the option of the lender. The units would be identical to the private units. Except as set forth above, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Prior to the completion of our initial Business Combination, we do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.
As of March 31, 2026, the Company had cash of $1,556,851 and working capital of $1,722,262.
Subsequent to the consummation of the Initial Public Offering, the Company’s liquidity has been satisfied through the net proceeds from the consummation of the Initial Public Offering and the Private Placement held outside of the Trust Account. 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, provide the Company Working Capital Loans. Cash and working capital were $1,737,168 and $1,727,277, respectively, after the closing of the Initial Public Offering, and $1,556,851 and $1,722,262, respectively, as of March 31, 2026.
Based on the foregoing, management believes that the Company will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of a Business Combination or one year from this filing. Over this time period, the Company will be using the funds held outside of the Trust Account for paying existing accounts payable, identifying and evaluating prospective initial Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to merge with or acquire, and structuring, negotiating and consummating the Business Combination.
Off-Balance Sheet Arrangements; Commitments and Contractual Obligations
As of March 31, 2026, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations, other than an agreement to pay our sponsor or its affiliate up to a monthly fee of $15,000 for office space, administrative and support services. We began incurring these fees on February 24, 2026 and will continue to incur these fees monthly until the earlier of the completion of the Business Combination and our liquidation.
Critical Accounting Estimates
We prepare our unaudited condensed financial statements in accordance with U.S. generally accepted accounting principles, which require our management to make estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking into account our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis.
There are no critical accounting estimates that were made with respect to the preparation of the historical unaudited condensed financial statements; however, the Company will be required to account for complex financial instruments at fair value upon the completion of our initial public offering, Such estimates will be critical to the Company’s (i) closing date allocation of proceeds to any instruments classified in equity, temporary equity or as liabilities and (ii) subsequent measurement with respect to the accretion of redeemable shares to their redemption amount and changes in the fair value of any liability classified instruments.
| 16 |
Risks and Uncertainties
Various social and political circumstances in the U.S. and around the world (including wars and other forms of conflict, including the war with Iran and trade tensions between the United States and China, and other uncertainties regarding actual and potential shifts in the U.S. and foreign, trade, economic and other policies with other countries, terrorist acts, security operations and catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes and global health epidemics), may contribute to increased market volatility and economic uncertainties or deterioration in the U.S. and worldwide. Specifically, the conflict between Russia and Ukraine, and the rising conflicts with Iran and elsewhere in the Middle East, and resulting market volatility could adversely affect the Company’s ability to complete a Business Combination. In response to the conflict between Russia and Ukraine, the U.S. and other countries have imposed sanctions or other restrictive actions against Russia. The war with Iran has resulted in spikes in fuel prices, among other consequences. Any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, could have a material adverse effect on the Company’s ability to complete an initial Business Combination and the value of the Company’s securities. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The net proceeds of our initial public offering and the sale of the private units held in the trust account are held as cash (including in interest bearing demand deposits) or invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk.
Item 4. Controls and Procedures.
Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2026. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective.
Changes in Internal Control over Financial Reporting
During our most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
The effectiveness of any system of internal control over financial reporting, including ours, is subject to inherent limitations, including the exercise of judgment in designing, implementing, operating, and evaluating the controls and procedures, and the inability to eliminate misconduct completely. Accordingly, in designing and evaluating the disclosure controls and procedures, management recognizes that any system of internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable, not absolute assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. We intend to continue to monitor and upgrade our internal controls as necessary or appropriate for our business but cannot assure you that such improvements will be sufficient to provide us with effective internal control over financial reporting.
| 17 |
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 1A. Risk Factors.
Not required for a smaller reporting company.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On February 13, 2026, the Registration Statement on Form S-1 (File No. 333-292967), as amended, relating to the initial public offering (the “IPO”) of the Company, was declared effective by the SEC. On February 23, 2026, the Company filed a subsequent registration statement on Form S-1 (File No. 333-293666) pursuant to Rule 462(b) of the Securities Act of 1933, as amended, and also in connection with the Company’s IPO, which subsequent registration statement became automatically effective upon its filing.
On February 25, 2026, the Company consummated the IPO of 12,500,000 Units, each Unit consists of one Class A ordinary share, and one right to receive one-fifth of an Ordinary Share, with each five rights entitling the holder thereof to receive one ordinary share upon the consummation of an initial business combination. The Units were sold at a price of $10.00 per Unit, generating gross proceeds to the Company of $125,000,000. Consequently, a total of $125,000,000 of the proceeds from the IPO and the private placement with ClearThink 1 Sponsor LLC, the Company’s sponsor, described below, were deposited in a trust account established for the benefit of the Company’s public shareholders (the “Trust Account”). In addition, on February 26, 2026, the IPO underwriter partially exercised its over-allotment option for 15,000 Units, generating additional gross proceeds to the Company of $150,000. Such proceeds, consisting of the entirety of the proceeds received by the Company after deduction for commissions from the IPO, plus additional funds from the private placement, were deposited in the Trust Account.
Simultaneously with the closing of the IPO, the Company completed the private sale and issuance of an aggregate of 315,000 units (the “Private Units”) to the Company’s sponsor, at a price of $10.00 per Private Unit, generating gross proceeds to the Company of $3,150,000. Each Private Unit consists of one Class A ordinary share and one right to receive one-fifth of a Class A ordinary share, with each five rights entitling the holder thereof to receive one Class A ordinary share upon the consummation of an initial business combination. Such securities were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
For a description of the use of the proceeds generated in the IPO and from the sale of the Private Units, see Part I, Item 2 of this Quarterly Report on Form 10-Q.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
During
the three months ended March 31, 2026, no director or officer, as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934,
as amended, of the Company
Item 6. Exhibits
| Exhibit No. | Description | |
| 1.1 | Underwriting Agreement, dated February 23, 2026, by and between the Company and D. Boral Capital LLC, as representative of the several underwriters. (1) | |
| 3.1 | Memorandum and Articles of Association. (2) | |
| 3.2 | Amended and Restated Memorandum and Articles of Association. (1) | |
| 4.1 | Specimen Unit Certificate. (2) | |
| 4.2 | Specimen Class A Ordinary Share Certificate. (2) | |
| 4.3 | Specimen Rights Certificate. (2) | |
| 4.4 | Rights Agreement dated February 25, 2026 between VStock Transfer and ClearThink 1 Acquisition Corp. (1) | |
| 4.5 | Description of Registered Securities (3) | |
| 10.1 | Promissory Note, dated October 14, 2025, issued to the ClearThink 1 Sponsor LLC. (2) | |
| 10.2 | Securities Subscription Agreement, dated October 14, 2025, between the Registrant and the Sponsor. (2) | |
| 10.3 | Indemnity Agreement dated February 25, 2026 with William Brock (1) | |
| 10.4 | Indemnity Agreement dated February 25, 2026 with Darwin Hunt (1) | |
| 10.5 | Indemnity Agreement dated February 25, 2026 with Yosef Milgrom (1) | |
| 10.6 | Indemnity Agreement dated February 25, 2026 with Julien Machot (1) | |
| 10.7 | Indemnity Agreement dated February 25, 2026 with Thomas Zipser (1) | |
| 10.8 | Investment Management Trust Agreement, dated February 25, 2026, by and between the Company and Equiniti Trust Company, LLC. (1) | |
| 10.9 | Registration Rights Agreement, dated February 25, 2026, by and among the Company, the Sponsor, and certain securityholders. (1) | |
| 10.10 | Insider Letter Agreement dated February 25, 2026 among ClearThink 1 Acquisition Corp., its directors and officers, and ClearThink 1 Sponsor LLC. (1) | |
| 10.11 | Administrative Services Agreement, dated February 25, 2026, by and between the Company and the Sponsor. (1) | |
| 14 | Code of Ethics. (3) | |
| 19 | Insider Trading Policy (3) | |
| 31.1 | Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2 | Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1 | Certification of the Principal Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 32.2 | Certification of the Principal Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 97.1 | Clawback Policy (3) | |
| 101.INS | Inline XBRL Instance Document. | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104 | Cover Page Interactive Data File (Embedded as Inline XBRL document and contained in Exhibit 101). |
| (1) | Incorporated by reference to the Company’s Registration Statement on Form 8-K, filed with the SEC on February 27, 2026. | |
| (2) | Incorporated by reference to Amendment No. 2 to the Company’s Registration Statement on Form S-1/A (File No. 333-292967), filed with the SEC on February 12, 2026. | |
| (3) | Incorporated by reference to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on March 31, 2026 |
| 18 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| May 15, 2026 | CLEARTHINK 1 ACQUISITION CORP. | |
| By: | /s/ William Brock | |
| Name: | William Brock | |
| Title: | Chief Executive Officer (Principal Executive Officer) | |
| By: | /s/ Thomas Zipser | |
| Name: | Thomas Zipser | |
| Title: | Chief Financial Officer (Principal Financial Officer) | |
| 19 |