[10-Q] Mountain Lake Acquisition Corp. Quarterly Earnings Report
Mountain Lake Acquisition Corp. (MLAC) filed its Q3 2025 report. As a SPAC, it reported net income of $2,133,281 for the quarter, driven by $2,527,476 of interest on trust assets and $394,195 of general and administrative expenses. Year‑to‑date net income was $6,348,172.
MLAC held $238,902,575 in cash and marketable securities in its Trust Account as of September 30, 2025, and $845,830 in cash outside the trust. The company disclosed “substantial doubt” about its ability to continue as a going concern if it does not complete a business combination within its combination period, noting plans to close a deal before the mandatory liquidation date.
On October 1, 2025, MLAC signed a Business Combination Agreement involving Avalanche Treasury entities and Dragonfly Digital Management. Concurrently, investors agreed to purchase approximately $274 million of Company Class A units at $10.00 per unit in a private placement, and the Foundation agreed to sell a minimum of $200 million of AVAX tokens, while 1,960,040 AVAX tokens will be contributed for 5,805,638 units. As of November 10, 2025, there were 23,805,000 Class A and 7,187,500 Class B ordinary shares outstanding.
- None.
- Going concern uncertainty: The company disclosed “substantial doubt” about its ability to continue as a going concern if it fails to complete a business combination within the combination period.
Insights
Trust income drives results; going-concern risk remains until deal closes.
MLAC operates as a SPAC, so earnings reflect interest on trust funds rather than operations. Q3 net income of
The filing states substantial doubt about continuing as a going concern absent a business combination within the allowed period. That risk is typical for SPACs and hinges on closing a transaction before the liquidation deadline.
The company signed a Business Combination Agreement on
UNITED STATES
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FORM
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MOUNTAIN LAKE ACQUISITION CORP.
FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2025
TABLE OF CONTENTS
| Page | ||
| Part I. Financial Information | ||
| Item 1. Interim Financial Statements | ||
| Condensed Balance Sheets as of September 30, 2025 (Unaudited) and December 31, 2024 | 1 | |
| Condensed Statements of Operations for the Three Months Ended September 30, 2025 and 2024, for the Nine Months Ended September 30, 2025 and for the Period from June 14, 2024 (inception) through September 30, 2024 (Unaudited) | 2 | |
| Condensed Statements of Changes in Shareholders’ Deficit For the Three and Nine Months Ended September 30, 2025, for the Three Months Ended September 30, 2024 and for the Period from June 14, 2024 (inception) through September 30, 2024 (Unaudited) | 3 | |
| Condensed Statements of Cash Flows for the Nine Months Ended September 30, 2025 and for the Period from June 14, 2024 (inception) through September 30, 2024 (Unaudited) | 4 | |
| Notes to Condensed Financial Statements (Unaudited) | 5 | |
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 16 | |
| Item 3. Quantitative and Qualitative Disclosures About Market Risk | 19 | |
| Item 4. Controls and Procedures | 19 | |
| Part II. Other Information | ||
| Item 1. Legal Proceedings | 20 | |
| Item 1A. Risk Factors | 20 | |
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 20 | |
| Item 3. Defaults Upon Senior Securities | 21 | |
| Item 4. Mine Safety Disclosures | 21 | |
| Item 5. Other Information | 21 | |
| Item 6. Exhibits | 22 | |
| Part III. Signatures | 23 |
i
PART I - FINANCIAL INFORMATION
Item 1. Interim Financial Statements.
MOUNTAIN LAKE ACQUISITION CORP.
CONDENSED BALANCE SHEETS
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| ASSETS | (Unaudited) | |||||||
| Current assets | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Prepaid insurance | ||||||||
| Total Current Assets | ||||||||
| Long-term prepaid insurance | ||||||||
| Cash and marketable securities held in Trust Account | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES, ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ DEFICIT | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Accrued offering costs | — | |||||||
| Due to Sponsor | ||||||||
| Total Current Liabilities | ||||||||
| Deferred underwriting fee payable | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies | ||||||||
| Class A ordinary shares subject to possible redemption, | ||||||||
| Shareholders’ Deficit | ||||||||
| Preference shares, $ | — | — | ||||||
| Class A ordinary shares, $ | ||||||||
| Class B ordinary shares, $ | ||||||||
| Additional paid-in capital | — | — | ||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Shareholders’ Deficit | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES, ORDINARY SHARES SUBJECT TO POSSIBLE REDEMPTION AND SHAREHOLDERS’ DEFICIT | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited condensed financial statements.
1
MOUNTAIN LAKE ACQUISITION CORP.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | For the Period from June 14, 2024 (inception) through September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
General and administrative expenses | $ | $ | $ | $ | ||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income: | ||||||||||||||||
| Interest earned on cash and marketable securities held in Trust Account | — | — | ||||||||||||||
| Net income (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Weighted average shares outstanding, Class A ordinary shares | — | — | ||||||||||||||
| Basic and diluted net income (loss) per share, Class A ordinary shares | $ | $ | — | $ | $ | — | ||||||||||
| Weighted average shares outstanding, Class B ordinary shares(1) | ||||||||||||||||
| Basic and diluted net income (loss) per share, Class B ordinary shares | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| (1) | Excluded up to 984,375 shares subject to forfeiture for the period from June 14, 2024 (inception) through September 30, 2024, if the over-allotment option was not exercised in full or in part by the underwriters. On December 16, 2024, the underwriters partially exercised their over-allotment option as part of the closing of the Initial Public Offering and forfeited their option to exercise the remaining over-allotment option. As such, 359,375 Founder Shares were forfeited (Note 5). |
The accompanying notes are an integral part of the unaudited condensed financial statements.
2
MOUNTAIN LAKE ACQUISITION CORP.
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT
(UNAUDITED)
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025
| Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance — January 1, 2025 | $ | $ | $ | — | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
| Accretion for Class A ordinary shares to redemption amount | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| Net income | — | — | — | — | — | |||||||||||||||||||||||
| Balance — March 31, 2025 (unaudited) | — | ( | ) | ( | ) | |||||||||||||||||||||||
| Accretion for Class A ordinary shares to redemption amount | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| Net income | — | — | — | — | — | |||||||||||||||||||||||
| Balance — June 30, 2025 (unaudited) | — | ( | ) | ( | ) | |||||||||||||||||||||||
| Accretion for Class A ordinary shares to redemption amount | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| Net income | — | — | — | — | — | |||||||||||||||||||||||
| Balance — September 30, 2025 (unaudited) | $ | $ | $ | — | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND FOR THE PERIOD FROM JUNE 14, 2024 (INCEPTION) THROUGH SEPTEMBER 30, 2024
| Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ Equity | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | (Deficit) | ||||||||||||||||||||||
| Balance — June 14, 2024 (inception) | — | $ | — | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
| Issuance of Founder shares to the Sponsor (1) | — | — | — | |||||||||||||||||||||||||
| Net loss | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| Balance — June 30, 2024 (unaudited) | — | — | ( | ) | ||||||||||||||||||||||||
| Net loss | — | — | — | — | — | ( | ) | ( | ) | |||||||||||||||||||
| Balance — September 30, 2024 (unaudited) | — | $ | — | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||
| (1) | Included up to 984,375 shares subject to forfeiture as of September 30, 2024, if the over-allotment option was not exercised in full or in part by the underwriters. On December 16, 2024, the underwriters partially exercised their over-allotment option as part of the closing of the Initial Public Offering and forfeited their option to exercise the remaining over-allotment option. As such, 359,375 Founder Shares were forfeited (Note 5). |
The accompanying notes are an integral part of the unaudited condensed financial statements.
3
MOUNTAIN LAKE ACQUISITION CORP.
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| For the Nine
Months Ended September 30, 2025 | For the Period from June 14, 2024 (inception) through September 30, 2024 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net income (loss) | $ | $ | ( | ) | ||||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
| Formation costs paid by Sponsor in exchange for issuance of Class B ordinary shares | — | |||||||
| Payment of operation costs through promissory note | — | |||||||
| Interest earned on cash and marketable securities held in Trust Account | ( | ) | — | |||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses and other current assets | ( | ) | ||||||
| Long-term prepaid insurance | — | |||||||
| Due to Sponsor | ( | ) | — | |||||
| Accrued offering costs | ( | ) | — | |||||
| Accounts payable and accrued expenses | — | |||||||
| Net cash used in operating activities | ( | ) | — | |||||
| Net Change in Cash | ( | ) | — | |||||
| Cash – Beginning of period | — | |||||||
| Cash – End of period | $ | $ | — | |||||
| Non-cash financing activities: | ||||||||
| Deferred offering costs included in accrued offering costs | $ | — | $ | |||||
| Deferred offering costs paid through prepaid expenses | $ | — | $ | |||||
| Prepaid expenses paid by Sponsor for issuance of Class B ordinary shares | $ | — | $ | |||||
| Deferred offering costs paid through promissory note – related party | $ | — | $ | |||||
The accompanying notes are an integral part of the unaudited condensed financial statements.
4
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
NOTE 1 — DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Mountain Lake Acquisition Corp. (the “Company”)
is a blank check company incorporated as a Cayman Islands exempted company on
As of September 30, 2025, the Company has not commenced any operations. All activity for the period from June 14, 2024 (inception) through September 30, 2025, 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 a Business Combination, at the earliest. The Company generates 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.
The registration statement for the Company’s
Initial Public Offering was declared effective on December 12, 2024. On December 16, 2024, the Company consummated the Initial Public
Offering of
Transaction costs amounted to $
The Company’s management has broad discretion
with respect to the specific application of the net proceeds of its Initial Public Offering and the sale of Private Placement Units,
although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The Company’s
initial Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least
Upon the closing of the Proposed Public Offering,
management has agreed that an amount equal to at least $
Following the closing of the Initial Public Offering
on December 16, 2024, an amount of $
The Company will provide its holders of the Public
Shares (the “Public Shareholders”) with the opportunity to redeem, regardless of whether they abstain, vote for, or against,
a Business Combination, all or a portion of their Public Shares upon either (i) the completion of the initial Business Combination
or an earlier redemption in connection with the commencement of the consummation of the initial Business Combination if the Company determines
it is desirable to facilitate the completion of the initial Business Combination, (ii) the redemption of the Public Shares if the
Company is unable to complete the initial Business Combination within the Combination Period (as defined below), subject to applicable
law, or (iii) the redemption of the Public Shares properly submitted in connection with a shareholder vote to amend the Amended
and Restated Memorandum and Articles of Association (A) to modify the substance or timing of the obligation to allow redemption
in connection with the initial Business Combination or to redeem
5
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
All of the Public Shares contain a redemption feature which allows for the redemption of such Public Shares in connection with the liquidation, if there is a shareholder vote or tender offer in connection with the initial Business Combination and in connection with certain amendments to the Amended and Restated Memorandum and Articles of Association (the “Amended and Restated Memorandum and Articles of Association”). The Public Shares were recorded at redemption value and classified as temporary equity at the completion of the Initial Public Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity.”
Additionally, each Public Shareholder may elect to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction. If the Company seeks shareholder approval in connection with a Business Combination, the holders of the Founder Shares (as defined in Note 5) prior to the Initial Public Offering (the “Initial Shareholders”) have agreed to vote their Founder Shares and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination. In addition, the Initial Shareholders have agreed to waive their redemption rights with respect to their Founder Shares and Public Shares in connection with the completion of a Business Combination. In addition, the Company has agreed not to enter into a definitive agreement regarding an initial Business Combination without the prior consent of the Sponsor.
Notwithstanding the foregoing, the Company’s
Amended and Restated Memorandum and Articles of Association provides 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
The Sponsor, executive officers, and directors
have agreed, pursuant to a letter agreement, that they will not propose any amendment to the Amended and Restated Memorandum and Articles
of Association (A) to modify the substance or timing of the Company’s obligation to redeem
If the Company is unable to complete a Business
Combination within
In connection with the redemption of
The Initial Shareholders have agreed to waive
their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within the Combination
Period. However, if the Initial Shareholders should acquire Public Shares in or after the Initial Public Offering, they will be entitled
to liquidating distributions from the Trust Account with respect to such Public Shares 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 funds held in the Trust Account that will be available to fund the redemption of the Company’s
Public Shares. In the event of such distribution, it is possible that the per share value of the residual assets remaining available
for distribution (including Trust Account assets) will be only $
6
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
Liquidity, Capital Resources and Going Concern
As of September 30, 2025, the Company had $
In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 205-40, “Presentation of Financial Statements—Going Concern”, as of September 30, 2025, the Company lacks the financial resources it needs to sustain operations for a reasonable period of time, which is considered to be one year from the date of the issuance of the financial statements. The Company cannot ensure that its plans to raise capital or to consummate an initial Business Combination will be successful. In addition, Management has determined that if the Company is unable to complete an initial Business Combination within the Combination Period, then the Company will cease all operations except for the purpose of liquidating. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management plans to consummate an initial Business Combination prior to the mandatory liquidation date. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after June 16, 2026.
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 (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the U.S. Securities and Exchange Commission (“SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with 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 accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the period ended December 31, 2024, as filed with the SEC on March 19, 2025. The interim results for the three and nine months ended September 30, 2025, for the three months ended September 30, 2024 and for the period from June 14, 2024 (inception) through September 30, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2025 or for any future periods.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (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 auditor 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 an emerging growth 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 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 the condensed financial statement in conformity with GAAP requires 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 condensed financial statements.
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 statement, 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.
7
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
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 had $
Cash and Marketable Securities Held in Trust Account
As of September 30, 2025 and December 31, 2024,
the assets held in the Trust Account, amounted to $
Class A Ordinary Shares Subject to Possible 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 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 September 30, 2025 and December 31, 2024, Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside of the shareholders’ deficit section of the Company’s condensed balance sheets.
As of September 30, 2025 and December 31, 2024, the Class A ordinary shares subject to possible redemption reflected in the condensed balance sheets are reconciled in the following table:
| Gross proceeds | $ | |||
| Less: | ||||
| Proceeds allocated to Public Share Rights | ( | ) | ||
| Class A ordinary shares issuance costs | ( | ) | ||
| Plus: | ||||
| Accretion for Class A ordinary shares to redemption amount | ||||
| Class A ordinary shares subject to possible redemption, December 31, 2024 | $ | |||
| Plus: | ||||
| Accretion for Class A ordinary shares to redemption amount | ||||
| Class A ordinary shares subject to possible redemption, September 30, 2025 | $ |
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement,” approximates the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature.
Fair Value Measurements
Fair value is defined as the price that would be received for sale of an asset or paid for 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; |
| ● | 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. |
8
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
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.
Offering Costs
The Company complies with the requirements of the ASC 340-10-S99 and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering.” Offering costs consist principally of professional and registration fees that are related to the Initial Public Offering. 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 applies this guidance to allocate Initial Public Offering proceeds from the Units between Class A ordinary shares and rights, using the residual method by allocating Initial Public Offering proceeds first to assigned value of the rights and then to the Class A ordinary shares. Offering costs allocated to Public Shares were charged to temporary equity, and offering costs allocated to share rights included in the Public and Private Placement Units were charged to shareholders’ equity (deficit) as the rights, after management’s evaluation, were accounted for under equity treatment.
Income Taxes
The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” which 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’s management determined that the Cayman Islands is the Company’s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of September 30, 2025 and December 31, 2024, there were no unrecognized tax benefits and no amounts accrued for interest and penalties. 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 Islands federal income tax regulations, income taxes are not levied on the Company. Consequently, income taxes are not reflected in the Company’s condensed financial statements. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.
Net Income (Loss) per Ordinary Share
The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company has two classes of ordinary 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 ordinary shares. This presentation assumes a business combination as the most likely outcome. Net income (loss) per ordinary share is calculated by dividing the net income (loss) by the weighted average ordinary shares outstanding for the respective period.
The calculation of diluted net income (loss) per
ordinary share does not consider the effect of the rights issued in connection with the Initial Public Offering and the Private Placement
to purchase an aggregate of
9
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
The following table presents a reconciliation of the numerator and denominator used to compute basic and diluted net income (loss) ordinary share for each class of ordinary shares:
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | For the Period from June 14, 2024 (inception) through September 30, | ||||||||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||||||||
| Class A Ordinary Shares | Class B Ordinary Shares | Class A Ordinary Shares | Class B Ordinary Shares | Class A Ordinary Shares | Class B Ordinary Shares | Class A Ordinary Shares | Class B Ordinary Shares | |||||||||||||||||||||||||
| Basic and diluted net income (loss) per share: | ||||||||||||||||||||||||||||||||
| Numerator: | ||||||||||||||||||||||||||||||||
| Allocation of net income (loss) | $ | $ | $ | — | $ | ( | ) | $ | $ | $ | — | $ | ( | ) | ||||||||||||||||||
| Denominator: | ||||||||||||||||||||||||||||||||
| Weighted-average shares outstanding | — | — | ||||||||||||||||||||||||||||||
| Basic and diluted net income (loss) per common stock | $ | $ | $ | — | $ | ( | ) | $ | $ | $ | — | $ | ( | ) | ||||||||||||||||||
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 coverage limit of $
Share Rights
The Company accounts for the Public and Private Placement Rights issued in connection with the Initial Public Offering and the private placement in accordance with the guidance contained in FASB ASC Topic 815, “Derivatives and Hedging”. Accordingly, the Company evaluated and classified the rights under equity treatment at their assigned values.
Recently Issued Accounting Standards
Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s condensed financial statements.
NOTE 3 — INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, on December
16, 2024, the Company sold
NOTE 4 — PRIVATE PLACEMENT
Simultaneously with the closing of the Initial
Public Offering, the Sponsor and BTIG purchased an aggregate of
10
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
NOTE 5 — RELATED PARTY TRANSACTIONS
Founder Shares
On June 27, 2024, the Sponsor made a capital
contribution of $
With certain limited exceptions, the Founder
Shares are not transferable, assignable or salable (except to the Company’s 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 earlier to occur of (i) one
year after the completion of the initial Business Combination or (ii) the date on which the Company completes a liquidation, merger,
share exchange or other similar transaction after the initial Business Combination that results in all of the shareholders having the
right to exchange their Class A ordinary shares for cash, securities or other property; except to certain permitted transferees
and under certain circumstances as described herein. Any permitted transferees will be subject to the same restrictions and other agreements
of the Initial Shareholders with respect to any Founder Shares. Notwithstanding the foregoing, if (1) the closing price of the Class A
ordinary shares equals or exceeds $
Due to Sponsor
As of September 30, 2025 and December 31, 2024,
the Company owed the Sponsor $
Related Party Loans
On June 27, 2024, the Sponsor agreed to
loan the Company up to $
In addition, in order to finance transaction costs
in connection with a Business Combination, the Sponsor, members of the Company’s founding team or any of their affiliates 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 would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise,
the Working Capital Loans would 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 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. The Working Capital Loans would either be repaid upon consummation
of a Business Combination, without interest, or, at the lender’s discretion, up to $
Services Agreement
The Company agreed, commencing on the closing
of Initial Public Offering through the earlier of consummation of the initial Business Combination and the liquidation, to pay the Chairman
and Chief Executive Officer and the President and Chief Financial Officer, a total of up to $
11
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
NOTE 6 — COMMITMENTS AND CONTINGENCIES
Registration and Shareholder Rights
The holders of the Founder Shares, Private Placement Units (and underlying securities) and any Units (and underlying securities) that may be issued on conversion of Working Capital Loans are entitled to registration rights pursuant to a registration rights agreement requiring the Company to register such securities for resale. The holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have certain piggyback registration rights with respect to registration statements filed subsequent to the completion of the initial 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 agreement provides that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until termination of the applicable lock-up period. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriters had a
The underwriters were paid a cash underwriting
discount of $
Risks and Uncertainties
The United States and global markets are experiencing volatility and disruption following the geopolitical instability resulting from the ongoing Russia-Ukraine conflict and the recent escalation of the Israel-Hamas conflict. In response to the ongoing Russia-Ukraine conflict, the North Atlantic Treaty Organization (“NATO”) deployed additional military forces to eastern Europe, and the United States, the United Kingdom, the European Union and other countries have announced various sanctions and restrictive actions against Russia, Belarus and related individuals and entities, including the removal of certain financial institutions from the Society for Worldwide Interbank Financial Telecommunication payment system. Certain countries, including the United States, have also provided and may continue to provide military aid or other assistance to Ukraine and to Israel, increasing geopolitical tensions among a number of nations. The invasion of Ukraine by Russia and the escalation of the Israel-Hamas conflict and the resulting measures that have been taken, and could be taken in the future, by NATO, the United States, the United Kingdom, the European Union, Israel and its neighboring states and other countries have created global security concerns that could have a lasting impact on regional and global economies. Although the length and impact of the ongoing conflicts are highly unpredictable, they could lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions and increased cyberattacks against U.S. companies. Additionally, any resulting sanctions could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets.
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law in the United States. The significant provisions of OBBBA include the permanent extension and modification of certain provisions of the Tax Cuts and Jobs Act which was enacted in 2017, including international tax provisions and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented in later years. The Company is evaluating the provisions of OBBBA, but it is not expected to have a material impact on the Company’s condensed financial statements.
Any of the above mentioned factors, or any other negative impact on the global economy, capital markets or other geopolitical conditions resulting from the Russian invasion of Ukraine, the escalation of the Israel-Hamas conflict, enactment of OBBBA and subsequent sanctions or related actions, could adversely affect the Company’s search for an initial Business Combination and any target business with which the Company may ultimately consummate an initial Business Combination.
NOTE 7 — SHAREHOLDERS’ DEFICIT
Preference Shares — The
Company is authorized to issue
Class A Ordinary Shares — The
Company is authorized to issue
12
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
Class B Ordinary Shares — The
Company is authorized to issue
Only holders of Class B ordinary shares
will have the right to vote on the election of directors prior to the Business Combination. Holders of Class A ordinary shares and
holders of Class B ordinary shares will vote together as a single class on all other matters submitted to a vote of the Company’s
shareholders except as otherwise required by law. Ordinary shareholders of record are entitled to
The Class B ordinary shares will automatically
convert into Class A ordinary shares concurrently with or immediately following the consummation of the initial Business Combination
on a one-for-one basis, subject to adjustment for share subdivisions, share capitalizations, reorganizations, recapitalizations and the
like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked
securities are issued or deemed issued in connection with the initial Business Combination, the number of Class A ordinary shares
issuable upon conversion of all Founder Shares will equal, in the aggregate,
Rights
Except in cases where the Company is not the
surviving company in a Business Combination, each holder of a right will automatically receive one-tenth (1/10) of
NOTE 8 — FAIR VALUE MEASUREMENTS
At September 30, 2025, assets held in the Trust
Account were comprised of $
| Gross | ||||||||||||||
| Amortized | Holding | |||||||||||||
| Held To Maturity | Cost | Gain | Fair Value | |||||||||||
| September 30, 2025 | $ | $ | $ | |||||||||||
At December 31, 2024, assets held in the Trust
Account were comprised of $
| Gross | ||||||||||||||
| Amortized | Holding | |||||||||||||
| Held To Maturity | Cost | Loss | Fair Value | |||||||||||
| December 31, 2024 | $ | $ | ( | ) | $ | |||||||||
13
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
NOTE 9 — SEGMENT INFORMATION
ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their 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 officer decision maker (“CODM”), or group, in deciding how to allocate resources and assess performance.
The CODM assesses performance for the single segment
and decides how to allocate resources based on net income (loss) that also is reported on the condensed statements of operations as net
income (loss). The measure of segment assets is reported on the condensed balance sheets as total assets.
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Cash | $ | $ | ||||||
| Cash and marketable securities held in Trust Account | $ | $ | ||||||
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | For the Period from June 14, 2024 (inception) through September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
General and administrative expenses | $ | $ | $ | $ | ||||||||||||
| Interest earned on cash and marketable securities held in Trust Account | $ | $ | — | $ | $ | — | ||||||||||
The CODM reviews interest earned on marketable securities held in Trust Account to measure and monitor shareholder value and determine the most effective strategy of investment with the Trust Account funds while maintaining compliance with the trust agreement. General and administrative expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a business combination within the business combination period. The CODM also reviews general and administrative expenses to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.
General and administrative expenses, as reported on the condensed statements of operations, are the significant segment expenses provided to the CODM on a regular basis.
14
MOUNTAIN LAKE ACQUISITION CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025
(Unaudited)
NOTE 10 — SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the condensed balance sheet date up to the date that the condensed financial statements were issued. Based upon this review, other than disclosed below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements.
Business Combination Agreement
On October 1, 2025, the Company entered into a Business Combination Agreement (the “Business Combination Agreement”) with Avalanche Treasury Corporation, a Delaware corporation (“Pubco”), Avalanche SPAC Merger Sub LLC, a Delaware limited liability company, Avalanche Company Merger Sub LLC, a Delaware limited liability company, Avalanche Treasury Company LLC, a Delaware limited liability company (the “AT Company”), and Dragonfly Digital Management, LLC, a Delaware limited liability company (the “Seller”). The transactions contemplated by the Business Combination Agreement are referred to as the “Proposed Business Combination.” Concurrently with the execution of the Business Combination Agreement, the Company entered into a Sponsor Support Agreement with the Sponsor and Pubco (the “Sponsor Support Agreement”). In addition, the Sponsor agreed pursuant to the Sponsor Support Agreement to effect certain security cancellations and to deposit certain Pubco Class A Stock issued to it at the closing of the Proposed Business Combination (the “Closing”) into escrow in connection with the Closing.
Concurrently with the execution of the Business Combination Agreement,
Pubco, the AT Company and the Company entered into subscription agreements (collectively, the “Company Unit Subscription Agreements”)
with certain investors (the “Company Unit Investors”), pursuant to which the Company Unit Investors agreed to purchase, payable
in cash or USD Coin (“USDC”), unlocked AVAX or locked AVAX, and the AT Company agreed to issue and sell, approximately $
Concurrently with the execution of the Business
Combination Agreement and the TSA (as defined below), the Seller, the AT Company, Pubco, Avalanche BVI and Avalanche Cayman (together
with Avalanche BVI, the “Foundation”), entered into an asset sale and contribution agreement (the “Contribution Agreement”),
pursuant to which, on the date of the Business Combination Agreement: (a) the Foundation agreed to sell a minimum of $
For further details on the Proposed Business Combination, refer to the Current Report on Form 8-K filed by the Company with the SEC on October 7, 2025.
15
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Mountain Lake Acquisition Corp. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Mountain Lake Acquisition Sponsor LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes related 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.
Special Note Regarding Forward-Looking Statements
This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the completion of the Proposed Business Combination (as defined below), the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, including that the conditions of the Proposed Business Combination are not satisfied. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Overview
We are a blank check company incorporated in the Cayman Islands on June 14, 2024 formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses that the Company has not yet identified (“Business Combination”). We intend to effectuate our Business Combination using cash derived from the proceeds of our initial public offering and the sale of the Private Placement Unit, our shares, debt or a combination of cash, shares and debt.
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.
Recent Developments
Business Combination Agreement with Avalanche Treasury Co.
On October 1, 2025, we entered into a Business Combination Agreement (the “Business Combination Agreement”) with Avalanche Treasury Corporation, a Delaware corporation (“Pubco”), Avalanche SPAC Merger Sub LLC, a Delaware limited liability company, Avalanche Company Merger Sub LLC, a Delaware limited liability company, Avalanche Treasury Company LLC, a Delaware limited liability company (the “AT Company”), and Dragonfly Digital Management, LLC, a Delaware limited liability company (the “Seller”). The transactions contemplated by the Business Combination Agreement are referred to as the “Proposed Business Combination.”
For further details on the Proposed Business Combination, refer to our Current Report on Form 8-K filed with the SEC on October 7, 2025.
Sponsor Support Agreement
Concurrently with the execution of the Business Combination Agreement, we entered into a Sponsor Support Agreement with our Sponsor and Pubco (the “Sponsor Support Agreement”). In addition, our Sponsor agreed pursuant to the Sponsor Support Agreement to effect certain security cancellations and to deposit certain Pubco Class A Stock issued to it at the closing of the Proposed Business Combination (the “Closing”) into escrow in connection with the Closing.
Company Unit Subscription Agreements
Concurrently with the execution of the Business Combination Agreement, we, Pubco and the AT Company entered into subscription agreements (collectively, the “Company Unit Subscription Agreements”) with certain investors (the “Company Unit Investors”), pursuant to which the Company Unit Investors agreed to purchase, payable in cash or USD Coin (“USDC”), unlocked AVAX or locked AVAX, and the AT Company agreed to issue and sell, approximately $274 million worth of Company Class A units (the “Subscribed Units”) at a price of $10.00 per Subscribed Unit, in a private placement (the “Company Unit Subscription”), upon the terms and subject to the conditions set forth therein. At the Closing, each Subscribed Unit held by Company Unit Investors will be converted automatically into one share of Pubco Class A Stock. Pursuant to the Company Unit Subscription Agreement, Pubco agreed to use commercially reasonable efforts to cause Pubco Class A Stock into which the Subscribed Units will be converted upon Closing to be registered with the SEC.
16
Token Sale Agreement
Concurrently with the execution of the Business Combination Agreement and the TSA (as defined below), the Seller, the AT Company, Pubco, Avalanche BVI and Avalanche Cayman (together with Avalanche BVI, the “Foundation”), entered into an asset sale and contribution agreement (the “Contribution Agreement”), pursuant to which, on the date of the Business Combination Agreement: (a) the Foundation agreed to sell a minimum of $200 million of AVAX tokens on a pre-discount basis to the AT Company on the terms and subject to the conditions set forth in a Token Sale Agreement (the “TSA”) by and between the Company and the Foundation, and (b) the Seller agreed to contribute, directly and indirectly through certain related funds, 1,960,040 AVAX tokens to the AT Company in exchange for 5,805,638 Company units.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities from June 14, 2024 (inception) through September 30, 2025 were organizational activities, those necessary to prepare for our initial public offering, described below, and identifying a target company for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination. We generate non-operating income in the form of interest income on marketable securities 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 September 30, 2025, we had a net income of $2,133,281, which consists of interest income on marketable securities held in the Trust Account of $2,527,476, partially offset by general and administrative expenses of $394,195.
For the nine months ended September 30, 2025, we had a net income of $6,348,172, which consists of interest income on marketable securities held in the Trust Account of $7,258,722, partially offset by general and administrative expenses of $910,550.
For the three months ended September 30, 2024, we had a net loss of $25,805 which primarily consist of general and administrative expenses.
For the period from June 14, 2024 (inception) through September 30, 2024, we had a net loss of $44,758 which primarily consist of general and administrative expenses.
Liquidity and Capital Resources
On December 16, 2024, we consummated the Initial Public Offering of 23,000,000 Units, which includes the partial exercise by the underwriters of their over-allotment option in the amount of 2,000,000 Units, at $10.00 per Unit, generating gross proceeds of $230,000,000. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 805,000 Private Placement Units at a price of $10.00 per Private Placement Unit in a private placement to the Sponsor, generating gross proceeds of $8,050,000.
Following the Initial Public Offering, the partial exercise of the over-allotment option, and the sale of the Private Units, a total of $231,150,000 was placed in the Trust Account. We incurred $13,354,261, consisting of $4,600,000 of cash underwriting fees, $8,050,000 of deferred underwriting fees and $704,261 of other offering costs.
For the nine months ended September 30, 2025, net cash used in operating activities was $537,562. Net income of $6,348,172 was affected by interest earned on marketable securities held in Trust of $7,258,722. Changes in operating assets and liabilities provided $372,988 of cash from operating activities.
17
For the period from June 14, 2024 (inception) through September 30, 2024, net cash used in operating activities was $0. Net loss of $44,758 was affected by formation costs paid by Sponsor in exchange for issuance of Class B ordinary shares of $8,533 and payment of operation costs through promissory note of $36,408. Changes in operating assets and liabilities used $183 of cash from operating activities.
At September 30, 2025, we had cash and marketable securities held in the Trust Account of $238,902,575 (including approximately $7,752,575 of interest income and net of unrealized losses). We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account, which interest shall be net of taxes payable and excluding deferred underwriting commissions, to complete our Business Combination. We may withdraw interest from the Trust Account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete a 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.
At September 30, 2025, we had cash of $845,830 held outside of the Trust Account. We intend to use the funds held outside the Trust Account primarily to 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, structure, negotiate and complete a Business Combination.
In order to fund working capital deficiencies or finance transaction costs in connection with a 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 a Business Combination, we may repay such loaned amounts out of the proceeds of the Trust Account released to us. In the event that a 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 $1.5 million of such Working Capital Loans may be converted into units of the post Business Combination entity at a price of $10.00 per Unit. The units would be identical to the Private Placement Units.
In connection with the Company’s assessment of going concern considerations in accordance with FASB ASC Topic 205-40, “Presentation of Financial Statements—Going Concern”, as of September 30, 2025, the Company lacks the financial resources it needs to sustain operations for a reasonable period of time, which is considered to be one year from the date of the issuance of the financial statements. The Company cannot ensure that its plans to raise capital or to consummate an initial Business Combination will be successful. In addition, Management has determined that if the Company is unable to complete an initial Business Combination within the Combination Period, then the Company will cease all operations except for the purpose of liquidating. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management plans to consummate an initial Business Combination prior to the mandatory liquidation date. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after June 16, 2026.
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of September 30, 2025. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual Obligations
We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay the Chairman and Chief Executive Officer and the President and Chief Financial Officer, a total of up to $20,000 per month for their services as executive officers and directors of the Company. For the three and nine months ended September 30, 2025, the Company incurred and paid an expense of $60,000 and $180,000 of fees for these services, respectively. For the three months ended September 30, 2024 and for the period from June 14, 2024 (inception) through September 30, 2024, no fees were incurred for these services.
The underwriters are entitled to a deferred underwriting fee of $0.35 per Unit, or $8,050,000 in the aggregate. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement.
18
Critical Accounting Estimates
The preparation of condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting policies.
Class A Ordinary Shares Subject to Possible 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 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.
Recent Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our condensed financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended September 30, 2025, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer and principal financial and accounting officer have concluded that during the period covered by this report, our disclosure controls and procedures were effective at a reasonable assurance level and, accordingly, provided reasonable assurance that the information required to be disclosed by us in reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting that occurred during the fiscal quarter of 2025 covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
19
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 1A. Risk Factors
Factors that could cause our actual results to differ materially from those in this report include the risk factors described in our Annual Report on Form 10-K with the SEC. As of the date of this Report, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K filed with the SEC, except as set forth below:
The Proposed Business Combination may not be completed on the terms or timeline currently contemplated, or at all.
The consummation of the Proposed Business Combination is subject to numerous conditions, including the effectiveness of the registration statement to be filed by us as part of the Proposed Business Combination, and other customary closing conditions, and there can be no assurance that the Proposed Business Combination will be consummated.
If the Proposed Business Combination is not completed for any reason, the price of our Class A ordinary shares may decline to the extent that the market price of our Class A ordinary shares reflects or previously reflected positive market assumptions that the Proposed Business Combination would be completed and the related benefits would be realized. In addition, we have expended and will continue to expend significant management time and resources and have incurred and will continue to incur significant expenses due to legal, advisory, printing, and financial services fees related to the Proposed Business Combination. These expenses must be paid regardless of whether the Proposed Business Combination is consummated.
If the Proposed Business Combination is not completed for any reason, our ongoing business and financial results may be adversely affected and, without realizing any of the benefits of having completed the Proposed Business Combination, we will be subject to a number of risks, including the following:
| ● | we will be required to pay costs relating to the Proposed Business Combination, which are substantial, such as legal, accounting, financial advisory, and printing fees, whether or not the Proposed Business Combination is completed; |
| ● | time and resources committed by our management to matters relating to the Proposed Business Combination could otherwise have been devoted to pursuing other beneficial opportunities; and |
| ● | we may experience negative reactions from financial markets, including negative impacts on the price of our Class A ordinary shares, including to the extent that the current market price reflects a market assumption that the Proposed Business Combination will be completed. |
During the pendency of the Business Combination Agreement, we may not be able to enter into a business combination with another party at a favorable price because of restrictions in the Business Combination Agreement, which could adversely affect our business.
Covenants in the Business Combination Agreement impede our ability to make acquisitions, subject to specified exceptions relating to fiduciary duties, or complete other mergers, sales of assets, or other business combinations pending completion of the Proposed Business Combination. As a result, if the Proposed Business Combination is not completed, we may be at a disadvantage to our competitors during that period. In addition, while the Business Combination Agreement is in effect, we are generally prohibited from soliciting, initiating, encouraging, or entering into specified extraordinary transactions, such as a merger, sale of assets, or other business combination, with any third party, subject to specified exceptions, even if any such transaction could be more favorable to our stockholders than the Proposed Business Combination. If the Proposed Business Combination is not completed, these provisions will make it more difficult to complete an alternative business combination following the termination of the Business Combination Agreement due to the passage of time during which these provisions have remained in effect.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On December 16, 2024, we consummated the Initial Public Offering of 23,000,000 Units. The Units were sold at an offering price of $10.00 per unit, generating total gross proceeds of $230,000,000. The securities in the offering were registered under the Securities Act on registration statement on Form S-1 (No.333-281410). The Securities and Exchange Commission declared the registration statements effective on December 12, 2024.
Simultaneously with the consummation of the Initial Public Offering, the Sponsor consummated the private placement of an aggregate of 805,000 Units at a price of $10.00 per Private Placement Unit with our Sponsor, and BTIG, as representative of the underwriters, generating total proceeds of $8,050,000. Each Unit consists of one Class A ordinary share and one right to receive one-tenth (1/10) of one Class A ordinary share upon the consummation of the initial business combination. The issuance was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.
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The Private Placement Units are identical to the units underlying the Units sold in the Initial Public Offering, except that the Private Placement Units are not transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions.
On December 13, 2024, the underwriters exercised the over-allotment option partially to purchase an additional 2,000,000 Units. On December 16, 2024, the Company consummated the IPO of 23,000,000 units (the “Units”). Each Unit consists of one Class A ordinary share, $0.0001 par value (“Class A Ordinary Share”) and one right to receive one-tenth (1/10) of one Class A Ordinary Share upon the consummation of an initial business combination. The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $230,000,000. A total of $231,150,000 of the net proceeds from the IPO (including the over-allotment Units) and the Private Placement (as defined below) were deposited in a trust account established for the benefit of the Company’s public shareholders.
We paid a total of $4,600,000 in underwriting discounts and commissions and $704,261 for other costs and expenses related to the Initial Public Offering. In addition, the underwriters agreed to defer $8,050,000 in underwriting discounts and commissions.
For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Form 10-Q.
Item 3. Defaults Upon Senior Securities
None
Item 4. Mine Safety Disclosures
None
Item 5. Other Information
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Item 6. Exhibits
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
| No. | Description of Exhibit | |
| 2.1+† | Business Combination Agreement, dated as of October 1, 2025, by and among SPAC, Pubco, SPAC Merger Sub, Company Merger Sub, the Company and the Seller (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 10.1† | Sponsor Support Agreement, dated as of October 1, 2025, by and among Sponsor, SPAC and Pubco (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 10.2† | Form of Sponsor Lock-Up Agreement, by and among Pubco, Sponsor, insiders and the undersigned holders thereto (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 10.3† | Form of Seller Lock-Up Agreement, by and between Pubco and the undersigned holders thereto (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 10.4 | Form of Amended and Restated Registration Rights Agreement, by and among Pubco, SPAC, Sponsor and the undersigned holders thereto (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 10.5+† | Form of Company Unit Subscription Agreement, dated as of October 1, 2025, by and among SPAC, Pubco, the Company and certain undersigned subscriber thereto (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 31.1* | Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
| 31.2* | Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
| 32.1** | Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 32.2** | Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 99.1† | Contribution Agreement, dated as of October 1, 2025, by and among the Seller, the Company, Pubco, Avalanche BVI and Avalanche Cayman (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 99.2† | Token Sale Agreement, dated as of October 1, 2025, by and among the Company, Pubco, Avalanche BVI and Avalanche Cayman (incorporated by reference to Exhibit 99.2 to the Current Report on Form 8-K of Mountain Lake Acquisition Corp. filed with the SEC on October 7, 2025). | |
| 101.INS* | XBRL Instance Document | |
| 101.SCH* | XBRL Taxonomy Extension Schema Document | |
| 101.CAL* | XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF* | XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB* | XBRL Taxonomy Extension Labels Linkbase Document | |
| 101.PRE* | XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
| * | Filed herewith |
| ** | These certifications are furnished to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. |
| + | Certain schedules, exhibits and similar attachments have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company will provide a copy of such omitted materials to the Securities and Exchange Commission or its staff upon request. |
| † | Certain personally identifiable information has been omitted from this exhibit pursuant to Item 601(a)(6) of Regulation S-K. |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| MOUNTAIN LAKE ACQUISITION CORP. | ||
| Date: November 10, 2025 | By: | /s/ Paul Grinberg |
| Name: | Paul Grinberg | |
| Title: | Chief Executive Officer | |
| (Principal Executive Officer) | ||
| Date: November 10, 2025 | By: | /s/ Douglas Horlick |
| Name: | Douglas Horlick | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) | ||
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FAQ
What were MLAC’s Q3 2025 results?
How much cash is in MLAC’s Trust Account?
Does MLAC face going concern risks?
What business combination did MLAC announce?
What financing accompanies the proposed deal?
How many MLAC shares are outstanding?
What drove MLAC’s year‑to‑date performance?
