Spark I Acquisition (SPKL) loss deepens as it pursues ZincFive merger and $106.5M raise
Spark I Acquisition Corporation, a SPAC, reported a net loss of $1,745,084 for the six months ended June 30, 2026, versus income a year earlier, as operating and formation expenses rose and interest income on its smaller trust balance declined. Cash outside the trust was $401,642 with a working capital deficit of $6,048,479.
After July 2025 redemptions of 7,763,287 Class A shares for about $84.8 million, approximately $24.4 million remained in the trust; trust investments totaled $25,813,648 at June 30, 2026 backing 2,236,713 redeemable Class A shares. The sponsor has provided a $1.9 million convertible note and a $2.5 million non-convertible note to fund costs.
The company entered into a Merger Agreement with ZincFive, Inc. and plans to domesticate to Delaware and rename as ZincFive, Inc., supported by a committed $106.5 million Series A preferred stock investment at Closing. Management discloses that limited liquidity, reliance on sponsor financing, and the requirement to complete a business combination by September 29, 2026 raise substantial doubt about its ability to continue as a going concern.
Positive
- Merger agreement with ZincFive signed June 11, 2026, with plans to domesticate to Delaware and combine operations, providing a defined path to complete the SPAC’s initial business combination.
- $106.5 million committed Series A preferred stock investment in New ZincFive, including 10,441,174 preferred shares and matching common stock warrants, enhances prospective post-combination capitalization.
- Sponsor support includes up to $1,500,000 of working capital loans convertible into warrants and agreed forfeiture of significant founder shares and warrants, potentially reducing dilution for public holders post-closing.
Negative
- Management states that limited liquidity, a $6,048,479 working capital deficit, and the September 29, 2026 deadline to complete a business combination raise substantial doubt about the company’s ability to continue as a going concern for the next twelve months.
- Large redemptions of 7,763,287 Class A shares for about $84.8 million left only 2,236,713 public Class A shares outstanding and approximately $24.4 million in the trust, materially shrinking the SPAC’s capital base.
- Total current liabilities increased to $6,552,358, including sponsor notes of $4,400,000 and accrued expenses of $2,078,858, while shareholders’ deficit deepened to $(9,548,479), reflecting heavier leverage and negative equity.
Filing Explained
The proposed ZincFive closing would add convertible preferred, warrant and common-stock securities; those issuances are not yet completed.
A Form 10-Q is an unaudited quarterly report. The company reports that its ZincFive merger agreement is signed but the transaction has not closed: shareholder approval and other closing conditions remain, and closing is expected in the second half of
If completed, SPKL would domesticate as Delaware corporation New ZincFive and convert its existing ordinary shares, units and warrants into New ZincFive securities. The post-closing structure would also include the agreed Series A preferred investment, convertible and warrant features, and additional common stock.
Under the Series A SPA, investors agreed to purchase
The Sponsor Agreement provides for closing-dependent forfeitures of
The filing also reports a
Key Figures
Key Terms
Business Combination financial
Trust Account financial
Going concern financial
Forward purchase agreement financial
12.0% Series A Cumulative Convertible Preferred Stock financial
Working Capital Loans financial
FAQ
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How much cash and trust capital does SPKL have as of June 30, 2026?
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What financing has been arranged around SPKL’s business combination with ZincFive?
Why does SPKL disclose substantial doubt about its ability to continue as a going concern?
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AI-generated analysis. How Rhea-AI works. Not financial advice.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(MARK ONE)
For the quarter ended
For the transition period from to
Commission file number:
SPARK I ACQUISITION CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
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Not Applicable
(Former name or former address, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | | Trading | | Name of each exchange on |
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Indicate by check mark 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 (§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 the 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.
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Large accelerated filer | ☐ | Accelerated filer | ☐ |
☒ | Smaller reporting company | ||
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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
As of August 14, 2026, there were
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SPARK I ACQUISITION CORPORATION
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2026
TABLE OF CONTENTS
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PART I - FINANCIAL INFORMATION | | |
Item 1. Financial Statements of Spark I Acquisition Corporation: | | |
Condensed Consolidated Balance Sheets as of June 30, 2026 (unaudited) and December 31, 2025 | | 1 |
Condensed Consolidated Unaudited Statements of Operations for the three and six months ended June 30, 2026 and 2025 | | 2 |
Condensed Consolidated Unaudited Statements of Changes in Shareholders’ Deficit for the three and six months ended June 30, 2026 and 2025 | | 3 |
Condensed Consolidated Unaudited Statements of Cash Flows for the six months ended June 30, 2026 and 2025 | | 4 |
Notes to Condensed Consolidated Unaudited Financial Statements | | 5 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | | 21 |
Item 3. Quantitative and Qualitative Disclosures about Market Risk | | 24 |
Item 4. Controls and Procedures | | 24 |
PART II - OTHER INFORMATION | | |
Item 1. Legal Proceedings | | 25 |
Item 1A. Risk Factors | | 25 |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | | 25 |
Item 3. Defaults upon Senior Securities | | 25 |
Item 4. Mine Safety Disclosures | | 25 |
Item 5. Other Information | | 25 |
Item 6. Exhibits | | 26 |
SIGNATURES | | 27 |
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements of Spark I Acquisition Corporation
SPARK I ACQUISITION CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
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| | June 30, | | December 31, | ||
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| 2026 | | 2025 | ||
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ASSETS |
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Current Assets: |
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Cash | | $ | | | $ | |
Prepaid expenses | |
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Total Current Assets | |
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Investments held in trust | | | | | | |
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Total Assets | | $ | | | $ | |
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LIABILITIES AND SHAREHOLDERS’ DEFICIT | |
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Current Liabilities: | |
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Accrued expenses and offering costs | | $ | | | $ | |
Related party payable | |
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Note payable - Sponsor | | | | | | |
Convertible note payable - Sponsor | | | | | | |
Total Current Liabilities | |
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Non-current Liabilities: | | | | | | |
Deferred underwriting fee payable | | | | | | |
Total Liabilities | | | | | | |
Commitments and contingencies (Note 6) | | | | | | |
Class A ordinary shares subject to possible redemption; | | | | | | |
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Shareholders’ Deficit: | |
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Preference shares, $ | |
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Class A ordinary shares, $ | |
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Class B ordinary shares, $ | | | | | | |
Additional paid-in capital | |
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Accumulated deficit | |
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Total Shareholders’ Deficit | |
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Total Liabilities and Shareholders’ Deficit | | $ | | | $ | |
The accompanying notes are an integral part of these unaudited financial statements.
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SPARK I ACQUISITION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
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| | For the Three Months | | For the Six Months | ||||||||
| | Ended June 30, | | Ended June 30, | ||||||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
EXPENSES | | | | | | | | | | | | |
Administrative fee – related party | | $ | | | $ | | | $ | | | $ | |
Formation and operating expenses | | | | | | | | | | | | |
TOTAL EXPENSES | | | | | | | | | | | | |
OTHER INCOME | | | | | | | | | | | | |
Interest Income | | | | | | | | | | | | |
Unrealized gain on investments held in Trust Account | | | | | | | | | | | | |
TOTAL OTHER INCOME | | | | | | | | | | | | |
Net (loss) income | | $ | ( | | $ | | | $ | ( | | $ | |
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Weighted Average Class A ordinary shares outstanding, basic and diluted | | | | | | | | | | | | |
Basic and diluted net (loss) income per share, Class A ordinary shares | | $ | ( | | $ | | | $ | ( | | $ | |
Weighted average number of shares of Class B ordinary shares outstanding, basic and diluted | | | | | | | | | | | | |
Basic and diluted net (loss) income per Class B ordinary share | | $ | ( | | $ | | | $ | ( | | $ | |
The accompanying notes are an integral part of these unaudited financial statements.
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SPARK I ACQUISITION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2026 AND 2025
(UNAUDITED)
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| | Class A Ordinary Shares | | Class B Ordinary Shares | | Paid-In | | Accumulated | | Shareholders’ | |||||||||
| | Shares | | Amount | | Shares | | Amount | | Capital | | Deficit | | Deficit | |||||
Balance, January 1, 2026 |
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Net Loss | | — | | | — | | — | | | — | | | — | | | ( | | | ( |
Remeasurement of Class A ordinary shares subject to possible redemption |
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Balance, March 31, 2026 | | | | $ | | | | | $ | | | $ | — | | $ | ( | | $ | ( |
Net Loss | | — | | | — | | — | | | — | | | — | | | ( | | | ( |
Remeasurement of Class A ordinary shares subject to possible redemption | | — | | | — | | — | | | — | | | — | | | ( | | | ( |
Balance, June 30, 2026 | | | | $ | | | | | $ | | | $ | — | | $ | ( | | $ | ( |
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| | Class A Ordinary Shares | | Class B Ordinary Shares | | Paid-In | | Accumulated | | Shareholders’ | |||||||||
| | Shares | | Amount | | Shares | | Amount | | Capital | | Deficit | | Deficit | |||||
Balance, January 1, 2025 |
| — | | $ | — | | | | $ | | | $ | — | | $ | ( | | $ | ( |
Net Income | | — | | | — | | — | | | — | | | — | | | | | | |
Remeasurement of Class A ordinary shares subject to possible redemption |
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Balance, March 31, 2025 | | — | | $ | — | | | | $ | | | $ | — | | $ | ( | | $ | ( |
Net Income | | — | | | — | | — | | | — | | | — | | | | | | |
Remeasurement of Class A ordinary shares subject to possible redemption | | — | | | — | | — | | | — | | | — | | | ( | | | ( |
Balance, June 30, 2025 | | — | | $ | — | | | | $ | | | $ | — | | $ | ( | | $ | ( |
The accompanying notes are an integral part of these unaudited financial statements.
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SPARK I ACQUISITION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
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| | For the Six | | For the Six | ||
| | Months Ended | | Months Ended | ||
| | June 30, 2026 | | June 30, 2025 | ||
Cash Flows From Operating Activities: | | | | | | |
Net income (loss) | | $ | ( | | $ | |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | | | | | | |
Interest earned on investments held in Trust Account | | | ( | | | ( |
Changes in operating assets and liabilities: | |
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Prepaid expenses | |
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Related party payable | |
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Accrued expenses and offering costs | |
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Net Cash Used In Operating Activities | |
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Cash Flows From Investing Activities: | | | | | | |
Cash deposited into Trust Account | |
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Net Cash Used In Investing Activities | | | ( | | | — |
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Cash Flows From Financing Activities: | | | | | | |
Proceeds from Convertible note payable - Sponsor | | | | | | |
Proceeds from Note payable - Sponsor | | | | | | |
Net Cash Provided By Financing Activities | |
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Net change in cash | |
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Cash at beginning of period | |
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Cash at end of period | | $ | | | $ | |
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Supplemental disclosure of non-cash financing activities: | | | | | | |
Remeasurement of Class A ordinary shares to redemption value | | $ | | | $ | |
The accompanying notes are an integral part of these unaudited financial statements.
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SPARK I ACQUISITION CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1 — DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS AND GOING CONCERN
Spark I Acquisition Corporation (the “Company”) was incorporated in the Cayman Islands on
As of June 30, 2026, the Company had not commenced any operations. All activity for the period from July 12, 2021 (inception) through June 30, 2026 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below, and since closing the Initial Public Offering, a search for a business combination candidate. The Company will not generate any operating revenues until after the completion 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.
The registration statement for the Company’s Initial Public Offering was declared effective on September 29, 2023. On October 11, 2023, the Company consummated its Initial Public Offering of
The Company incurred offering costs of $
On October 10, 2023, the underwriter informed the Company that it will not be exercising the over-allotment option. As a result, the Sponsor forfeited an aggregate of
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The stock exchange listing rules require that the Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least
The Company has provided 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 shareholder 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 $
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The Company will not redeem Public Shares in an amount that would cause its net tangible assets to be less than $
Notwithstanding the foregoing, if the Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, 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 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 by September 29, 2026 (the “Combination Period”), or the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem
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, 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) $
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reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act. However, the Company has not asked the Sponsor to reserve for such indemnification obligations, nor have it independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and we believe that the Sponsor’s only assets are securities of the Company. Therefore, the Company cannot assure that the Sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made against the trust account, the funds available for the Company’s initial business combination and redemptions could be reduced to less than $
On June 25, 2025, the Sponsor agreed to make monthly deposits, each in an amount equal to the lesser of (i) $
On July 8, 2025, the Company held an extraordinary general meeting of shareholders where the Company’s shareholders approved the proposal to amend the Company’s amended and restated memorandum and articles of association to extend the date by which the Company has to consummate a business combination from July 11, 2025 to September 29, 2026.
In connection with the July 8, 2025 extraordinary general meeting of shareholders, the Sponsor agreed to convert
In connection with the July 8, 2025 extraordinary general meeting of shareholders, holders of
On May 14, 2026, the Company received a written notice from the Listing Qualifications Department of The Nasdaq Stock Market (“Nasdaq”) indicating that the Company is not in compliance with Listing Rule 5450(a)(2) (the “Minimum Total Holders Rule”), which requires the Company to have at least 400 “Total Holders” (defined as both beneficial holders and holders of record) of the Company’s ordinary shares for continued listing on the Nasdaq Global Market. The Notice is only a notification of deficiency, not of imminent delisting, and has no immediate effect on the listing or trading of the Company’s securities on the Nasdaq Global Market. The Notice stated that that Company has 45 days to submit a plan to regain compliance with the Minimum Total Holders Rule. The Company submitted a compliance plan on June 29, 2026 for Nasdaq to review. If Nasdaq accepts the Company’s plan, Nasdaq may grant the Company an extension of up to 180 calendar days from the date of the Notice to evidence compliance with the Minimum Total Holders Rule. If Nasdaq does not accept the Company’s plan, the Company will have the opportunity to appeal the decision in front of a Nasdaq Hearings Panel. The Company has been in contact with a represenatative at Nasdaq and considers the issue remediated.
On June 11, 2026 (the “Signing Date”), the Company entered into an Agreement and Plan of Merger and Reorganization (as it may be amended, supplemented or otherwise modified from time to time in accordance with its terms, the “Merger Agreement”), by and among the Company, Spark I Acquisition Corporation Sub I Inc., a Delaware corporation (“Merger Sub I”), Spark I Acquisition Corporation Sub II LLC, a Delaware limited liability company (“Merger Sub II” and together with Merger Sub I, the “Merger Subs”), and ZincFive, Inc., a Delaware corporation (“ZincFive”). The transactions contemplated by the Merger Agreement are referred to as the “Business Combination.” The Company, Merger Sub I, Merger Sub II and ZincFive are each individually referred to as a “Party” and, collectively, as the “Parties.” In connection with the Closing, the Company will change its name to “ZincFive, Inc.”
The Merger Agreement and the Business Combination were unanimously approved by the boards of directors of each of the Company, Merger Sub I and ZincFive and by the managing member of Merger Sub II.
The Business Combination is expected to close in the second half of 2026 following the receipt of the required approval of the Company’s shareholders and the fulfillment of other customary closing conditions that are set forth in the Merger Agreement.
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Subject to obtaining the required shareholder approvals and at least
Immediately prior to the Domestication, each of the holders of the then issued and outstanding Class B ordinary shares of the Company will cause each Cayman Class B Share to be converted, on a
Sponsor Agreement
Concurrently with the execution of the Merger Agreement, the Company entered into the Sponsor Agreement (the “Sponsor Agreement”) with ZincFive, the Sponsor, certain stockholders of the Company (together with the Sponsor, the “Insiders”) and, solely for purposes of the Letter Agreement Amendment (as defined below), Ho Min (Jimmy) Kim, Chief Financial Officer of the Company (the “Non-Shareholder Insider”). Under the terms of the Sponsor Agreement, the Insiders agreed to, among other things: (i) vote in favor of adoption of the the Company Stockholder Matters; (ii) vote against any Acquisition Transaction (as defined in the Merger Agreement) and any merger agreement or merger other than the Merger Agreement and the Business Combination; (iii) vote against any change in the business, management or board of directors of the Company (other than in connection with the the Company Stockholder Matters or pursuant to the Merger Agreement or ancillary agreements); and (iv) vote against any proposal, action or agreement that would: (A) impede, interfere, frustrate, prevent or nullify any provision of the Sponsor Agreement, the Merger Agreement or the Business Combination; (B) result in a breach in any respect of any covenant, representation, warranty or any other obligation or agreement of the Company under the Merger Agreement; (C) result in any of the closing conditions of the Merger Agreement not being fulfilled; (D) result in a breach of any covenant, representation or warranty or other obligation or agreement of the Sponsor in the Sponsor Agreement; or (E) change in any manner the dividend policy or capitalization of, including the voting rights of any class of capital stock of, the Company. Each officer and director of the Company previously entered into a letter agreement with the Company in connection with the Company’s initial public offering, pursuant to which they agreed to vote any the Company ordinary shares held by them in favor of the Business Combination. If at any time following the Signing Date and until the termination of the Merger Agreement, the board of directors of the Company effect a Modification of Recommendation, then the obligations to vote or consent in accordance with the foregoing clauses (i)-(iv) will automatically be deemed to be modified such that the Sponsor will vote or provide its consent with respect to its Sponsor Securities (as defined below) in the same proportion to the votes cast or consent provided, as applicable, by the holders of the Cayman Class A Shares.
Pursuant to the Sponsor Agreement, during the period commencing on the Signing Date until the earliest of (a) termination of the Merger Agreement, (b) the liquidation of the Company, (c) the first anniversary of the Closing Date and (d) the date upon which the volume-weighted average price (“VWAP”) of New ZincFive Common Stock equals or exceeds $
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Pursuant to the Sponsor Agreement, but subject to the consummation of the Business Combination, the Insiders agreed to waive all anti-dilution rights with respect to the rate that the Cayman Class B Shares convert into the Cayman Class A Shares in connection with the transactions contemplated by the Merger Agreement.
In addition, pursuant to the Sponsor Agreement, (a) Sponsor may elect to convert up to $
The Sponsor Agreement also amends that certain letter agreement, dated as of October 5, 2023 (the “Letter Agreement” and such amendment, the “Letter Agreement Amendment”), by and among SPKL, the Insiders and the Non-Shareholder Insider, pursuant to which the Sponsor agreed to surrender a number of Cayman Class B Shares (including any Cayman Class A Shares issued upon conversion of Cayman Class B Shares) in certain circumstances. As a result of the Letter Agreement Amendment, effective immediately prior to the First Merger, the Sponsor will not be obligated to surrender any Cayman Class B Shares (or Cayman Class A Shares issued upon conversion of Cayman Class B Shares) if the Forward Purchaser (as defined in the Letter Agreement) does not purchase $
Series A Preferred Stock Investments
In connection with the transactions contemplated by the Merger Agreement, on the Signing Date, the Company and ZincFive entered into a Securities Purchase Agreement (the “Series A SPA”) with certain institutional and accredited investors (the “Series A Preferred Stock Investors”). Pursuant to the Series A SPA, the Series A Preferred Stock Investors agreed, among other things, to purchase, concurrently with the Closing, an aggregate of
As a condition to the closing of Alyeska Master Fund, L.P.’s (the “Lead Purchaser”) Series A Preferred Stock Investment, the Company will issue an aggregate of
Liquidity and Capital Resources
As of June 30, 2026, the Company had $
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). However, the Company has future obligations to management, consultants, and directors that will likely extinguish the cash balance within approximately a year from the filing date of the Quarterly Report on Form 10-Q for the quarter ended June 30, 2026.
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In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 205-40, Presentation of Financial Statements—Going Concern, the Company was formed for the purpose of completing a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities on or before September 29, 2026. There is no assurance that the Company will obtain the necessary approvals or raise the additional capital it needs to fund its business operations and complete any business combination prior to September 29, 2026, if at all. The Company also has no approved plan in place to extend the business combination deadline beyond September 29, 2026, and lacks the capital resources needed to fund operations and complete any business combination, even if the deadline to complete a business combination is extended to a later date. Management has determined that the liquidity condition and timing of liquidation raises substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the issuance of these financial statements. No adjustments have been made to the carrying amounts of assets or liabilities. The Company’s Sponsor, officers and directors may, but are not obligated to, loan the Company funds from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital.
Risks and Uncertainties
Various social and political circumstances in the U.S. and around the world (including wars and other forms of conflict, including rising 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. The Iran war has resulted in higher oil prices and created concerns about economic recession. Tariffs imposed by the U.S. presidential administration caused geopolitical tension and higher prices of goods throughout the global economy. Sanctions imposed by the U.S. and other countries in connection with hostilities between Russia and Ukraine and tensions between China and Taiwan have caused additional financial market volatility and affected the global economy. Concerns over persistent inflation, economic recession, as well as interest rate volatility and fluctuations in oil and gas prices resulting from global production and demand levels, as well as geopolitical tension, have exacerbated market volatility and could adversely affect the Company’s ability to complete a business combination and could have a material adverse effect on the value of the Company’s securities. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
The impact of these conflicts on the world economy is not determinable as of the date of these financial statements and the specific impact on the Company’s financial condition, results of operations, and cash flows is also not determinable as of the date of these financial statements.
NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements are presented in U.S. dollars and 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 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, the accompanying unaudited condensed consolidated financial statements 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 consolidated 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 consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on March 30, 2025. The interim results for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the year ending December 31, 2026 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 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
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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, 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.
Principles of Consolidation
The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, the Merger Subs. The subsidiaries were formed solely for the purpose of completing an initial Business Combination and have had no operating activity since inception. All significant intercompany balances and transactions have been eliminated in consolidation.
Offering Costs Associated with the Initial Public Offering
Offering costs consisted of legal, accounting, underwriting fees and other costs incurred through the Initial Public Offering that were directly related to the Initial Public Offering. Offering costs are allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds received.
Class A Ordinary Shares Subject to Possible Redemption
As discussed in Note 3, all of the
The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital and accumulated deficit. For the six months ended June 30, 2026 and 2025, the Company recorded measurement adjustments of $
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As of June 30, 2026 and 2025, the amount of Class A ordinary shares reflected on the balance sheet are reconciled in the following table:
| | | | | |
| | Amount | | Shares | |
Class A ordinary shares subject to possible redemption, January 1, 2025 | | $ | |
| |
| | | | | |
Plus: | | | | | |
Remeasurement adjustment on redeemable ordinary shares | | | | | — |
Class A ordinary shares subject to possible redemption, June 30, 2025 | | $ | | | |
| | | | | |
Class A ordinary shares subject to possible redemption, January 1, 2026 | | $ | | | |
| | | | | |
Plus: | | | | | |
Remeasurement adjustment on redeemable ordinary shares | | | | | — |
Class A ordinary shares subject to possible redemption, June 30, 2026 | | $ | | | |
Class B to Class A Share Conversion
As of December 31, 2025,
Net Income (Loss) per Ordinary Share
The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” Net income (loss) per ordinary share is computed by dividing net income (loss) by the weighted average number of ordinary shares outstanding for the period. Weighted average shares were not reduced for the effect of an aggregate of
The calculation of diluted income (loss) per ordinary share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering and (ii) the Private Placement. As of June 30, 2026 and 2025, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into ordinary shares and subsequently share in the earnings of the Company.
The following table reflects the calculation of basic and diluted net income (loss) per ordinary share.
| | | | | | |
| | For the six months ended | ||||
| | June 30, | | June 30, | ||
| | 2025 | | 2024 | ||
Class A Redeemable ordinary shares |
| | |
| | |
Numerator: Allocation of net income, as adjusted | | $ | | | $ | |
Denominator: Basic and diluted weighted average shares outstanding | |
| | |
| |
Basic and diluted net income per Class A Ordinary Share | | $ | | | $ | |
Class B Non-redeemable ordinary shares | |
| | |
| |
Numerator: Allocation of net income, as adjusted | | $ | | | $ | |
Denominator: Basic and diluted weighted average shares outstanding | |
| | |
| |
Basic and diluted net income per Class B Ordinary Share | | $ | | | $ | |
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| | | | | | |
| | For the six months ended | ||||
| | June 30, | | June 30, | ||
| | 2026 | | 2025 | ||
Class A Redeemable ordinary shares |
| | |
| | |
Numerator: Allocation of net income (loss), as adjusted | | $ | ( | | $ | |
Denominator: Basic and diluted weighted average shares outstanding | |
| | |
| |
Basic and diluted net income (loss) per Class A Ordinary Share | | $ | ( | | $ | |
Class B Non-redeemable ordinary shares | |
| | |
| |
Numerator: Allocation of net income (loss), as adjusted | | $ | ( | | $ | |
Denominator: Basic and diluted weighted average shares outstanding | |
| | |
| |
Basic and diluted net income (loss) per Class B Ordinary Share | | $ | ( | | $ | |
| | | | | | |
| | For the three months ended | ||||
| | June 30, | | June 30, | ||
| | 2026 | | 2025 | ||
Class A Redeemable ordinary shares |
| | |
| | |
Numerator: Allocation of net income (loss), as adjusted | | $ | ( | | $ | |
Denominator: Basic and diluted weighted average shares outstanding | |
| | |
| |
Basic and diluted net income (loss) per Class A Ordinary Share | | $ | ( | | $ | |
Class B Non-redeemable ordinary shares | |
| | |
| |
Numerator: Allocation of net income (loss), as adjusted | | $ | ( | | $ | |
Denominator: Basic and diluted weighted average shares outstanding | |
| | |
| |
Basic and diluted net income (loss) per Class B Ordinary Share | | $ | ( | | $ | |
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
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.
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 Depository Insurance Coverage of $
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
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Investments held in Trust Account
At June 30, 2026 and December 31, 2025, the Company had $
Investments held in Trust Account are presented on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments held in the Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information. Fair values of these investments are determined by Level 1 input utilizing quoted prices (unadjusted) in active markets for identical assets.
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 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 to transfer of a liability, in an orderly transaction between market participants at the measurement date. US 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. |
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 statements 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 sheets 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.
Warrant Instruments
The Company accounts for the Public Warrants and the Private Placement Warrants issued in connection with the Initial Public Offering and the Private Placement in accordance with the guidance contained in FASB ASC 815, “Derivatives and Hedging”. Under ASC 815-40 the Public Warrants and the Private Placement Warrants meet the criteria for equity treatment and as such will be recorded in shareholders’ deficit. If the warrants 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.
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Recent Accounting Standards
In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2024-03, “Disaggregation of Income Statement Expenses,” which requires disclosures of certain disaggregated income statement expense captions into specified categories within the footnotes to the financial statements. The requirements of the ASU are effective for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the impact ASU No. 2024-03 will have on its condensed consolidated financial statements.
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.
NOTE 3 — INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company sold
NOTE 4 — PRIVATE PLACEMENTS
Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of
NOTE 5 — RELATED PARTIES
Founder Shares
On December 8, 2021, the Sponsor received
On April 1, 2022, the Sponsor transferred a total of
On October 10, 2023, the underwriter informed the Company that it will not be exercising the over-allotment option. As a result, the Sponsor forfeited an aggregate of
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of: (A) one year after the completion of a Business Combination and subsequent to a Business Combination, (x) if the last reported sale price of the Class A ordinary shares equals or exceeds $
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after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Public Shareholders having the right to exchange their shares of ordinary shares for cash, securities or other property.
On July 8, 2025, the Sponsor agreed to convert
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 $
Convertible Note Payable - Sponsor
On January 28, 2025, the Company issued an unsecured promissory note (the “Note”) in the principal amount of up to $
Note Payable – Sponsor
On June 25, 2025, the Company issued a non – convertible unsecured promissory note (the “Second Note”) in the principal amount of up to $
Related Party Loans
On March 29, 2024, the Sponsor advanced the Company $
NOTE 6 — COMMITMENTS AND CONTINGENCIES
Registration Rights
The holders of the Founder Shares, Private Placement Warrants and warrants that may be issued upon conversion of Working Capital Loans (and any shares of ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of Initial Public Offering requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to shares of Class A ordinary shares). 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 “piggy-back” registration rights with respect to registration statements filed subsequent
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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 agreement provides 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
The Company paid the underwriters a cash underwriting discount of $
Forward Purchase Agreement
SparkLabs Group Management, LLC (“forward purchaser”), an accredited institutional investor affiliated with the Sponsor, has entered into a forward purchase agreement with the Company that provides for the purchase by the forward purchaser of forward purchase units for an aggregate purchase price of at least $
The obligations under the forward purchase agreement will not depend on whether any Class A ordinary shares are redeemed by the Public Shareholders. The forward purchase shares will be identical to the shares of Class A ordinary shares included in the Units being sold in the Initial Public Offering, except that they will be subject to transfer restrictions and registration rights.
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NOTE 7 — SHAREHOLDERS’ 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
The Founder Shares are designated as Class B ordinary shares and will automatically convert 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 we do not consummate an initial business combination) at the time of our initial business combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, at most
NOTE 8 — WARRANTS
There were
The Company will not be obligated to deliver any shares of Class A ordinary share pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A ordinary shares issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A ordinary shares is available, subject to the Company satisfying its obligations with respect to registration, or a valid exemption from registration is available.
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The Company has agreed that as soon as practicable, but in no event later than
Redemption of Warrants When the Price per Share of Class A ordinary share Equals or Exceeds $
| ● | in whole and not in part; |
| ● | at a price of $ |
| ● | upon a minimum of |
| ● | if, and only if, the last reported sale price of the Class A ordinary shares equals or exceeds $ |
If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws.
In addition, if (x) the Company issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of its initial business combination at a Newly Issued Price of less than $
The Private Placement Warrants will be identical to the Public Warrants underlying the Units being sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or saleable until 30 days after the completion of a Business Combination, subject to certain limited exceptions.
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NOTE 9 — FAIR VALUE MEASUREMENTS
The following table presents information about the Company’s assets and liabilities that are measured at fair value at June 30, 2026 and December 31, 2025, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| | | | | | | | | | |
| | | | June 30, | | | | December 31, | ||
Description | | Level | | 2026 | | Level | | 2025 | ||
Assets: |
| |
| | |
| |
| | |
Investments held in Trust Account |
| 1 | | $ | |
| 1 | | $ | |
Transfers to/from Levels 1, 2, and 3 are recognized at the beginning of the reporting period. During the six months ended June 30, 2026 and 2025, there were
In accordance with the Company’s investment management trust agreement, investments held in trust consist only of money market mutual funds invested solely in direct U.S. treasury obligations, which is considered a Level 1 measurement. The Company uses inputs such as actual trade data, benchmark yields, quoted market prices from dealers or brokers, and other similar sources to determine the fair value of its investments.
NOTE 10 — SEGMENT INFORMATION
ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statements 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 (“CODM”), or group, in deciding how to allocate resources and assess performance.
The Company is a blank check company formed for the purpose of effecting a Business Combination. As of June 30, 2026, the Company had not commenced any operations. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income on the investments held in the Trust Account.
The Company’s CODM has been identified as the Chief Executive Officer, who reviews the operating results 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
When evaluating the Company’s primary measure of performance and making key decisions regarding resource allocation in order to ensure sufficient capital to complete an initial business combination and meet working capital requirements, the CODM reviews several key metrics, which include the following:
| | | | | | | | | | | | |
| | For the Six Months Ended | | For the Three Months Ended | ||||||||
| | June 30, | | June 30, | | June 30, | | June 30, | ||||
| | 2026 | | 2025 | | 2026 | | 2025 | ||||
Loss from operations | | $ | ( | | $ | ( | | $ | ( | | $ | ( |
| | | | | | | | | | | | |
Total other income | |
| | |
| | | | | | | |
| | | | | | | | | | | | |
Net income (loss) | | $ | ( | | $ | | | $ | ( | | $ | |
NOTE 11 — SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date through August 14, 2026, the date that the financial statements issued. Based upon this review, the Company did not identify any other subsequent events that would have required adjustment or disclosure in the financial statements.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
References in this Quarterly Report on Form 10-Q (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Spark I Acquisition Corporation References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to SLG SPAC Fund 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 thereto contained elsewhere in this Quarterly Report on Form 10-Q. 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 search of an initial 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. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those expressed or implied by forward-looking statements include our ability to consummate a business combination with ZincFive Inc. (“ZincFive”) or any other operating company on acceptable terms, if at all, and before the outside date under our amended and restated memorandum of articles of association as well as those risks discussed elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2025, including those under the heading “Risk Factors.” 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 on July 12, 2021, as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar combination with one or more businesses or assets, which we refer to throughout this Quarterly Report on Form 10-Q as our “Business Combination.” To date, our efforts have been limited to organizational activities and activities related to the search for a target business for our initial business combination. We have generated no revenues to date, and we do not expect that we will generate operating revenues at the earliest until we consummate our initial business combination. Since our initial public offering (the “Initial Public Offering”), we have completed a detailed assessment of SparkLabs Group ecosystem companies, and have finalized initial targets to prioritize.
Following substantive discussions with multiple prioritized targets, in June 2026, we announced that we had entered into an agreement and plan of merger and reorganization with ZincFive, Inc. See the risk factor titled “We may not be able to consummate an initial business combination by September 29, 2026, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate.” in our Annual Report on Form 10-K for the year ended December 31, 2025.
We intend to utilize cash derived from the proceeds of our initial public offering (the “IPO”) and the private placement of Private Units, our securities, debt or a combination of cash, securities and debt, in effecting our initial business combination. In order to finance our working capital needs, SLG SPAC Fund LLC (the “Sponsor”) or an affiliate of the Sponsor, or certain of our officers and directors may, but are not obligated to, provide us working capital loans. On January 28, 2025, we issued a convertible unsecured promissory note in the principal amount of up to $1,900,000 to the Sponsor, of which we borrowed $1,900,000 and $1,540,000 as of June 30, 2026 and December 31, 2025, respectively. The note does not bear interest and is repayable in full upon consummation of the Company’s initial business combination. Upon the consummation of a business combination, the Sponsor will have the option, but not the obligation, to convert all or a portion of up to $1,500,000 of the unpaid principal balance of the Note into a number of Working Capital Warrants equal to the principal amount of the Note so converted divided by $1.00. The terms of the Working Capital Warrants will be identical to the terms of the Private Warrants. On June 25, 2025, we issued a non – convertible unsecured promissory note in the principal amount of up to $2,500,000 to the Sponsor, of which we borrowed $2,500,000 and 1,700,000 as of June 30, 2026 and December 31, 2025, respectively. The non - convertible unsecured promissory note does not bear interest and is repayable upon the earlier of the
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consummation of our initial business combination and the last day that we have to complete a business combination. We have incurred, or expect to continue to incur, significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an initial business combination will be successful.
Results of Operations
We have neither engaged in any operations nor generated any operating revenues to date. Our only activities through June 30, 2026 were organizational activities and those necessary to prepare for our IPO, which is described below, and subsequent to the IPO, identifying a target company for an initial business combination. We do not expect to generate any operating revenues until after the completion of our initial business combination.
We expect to generate non-operating income in the form of interest income on investments held in the trust account after the IPO. We have incurred, or expect that we will incur, increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with searching for, and completing, our initial business combination.
For the three months ended June 30, 2026, we had net loss of $1,650,889, which consists of operating expenses of $1,697,094 and administration – related party expenses of $179,940 offset by the interest earned on investments held in the Trust Account of $226,144 and interest income of $1.
For the three months ended June 30, 2025, we had net income of $362,583, which consists of operating expenses of $478,217 and administration – related party expenses of $285,650 offset by the interest earned on investments held in the Trust Account of $1,126,449 and interest income of $1.
For the six months ended June 30, 2026, we had net loss of $1,745,084, which consists of operating expenses of $1,853,113 and administration – related party expenses of $339,880, offset by the interest earned on investments held in the Trust Account of $447,907 and operating account interest income of $2.
For the six months ended June 30, 2025, we had net income of $904,912, which consists of operating expenses of $785,932 and administration – related party expenses of $555,300, offset by the interest earned on investments held in the Trust Account of $2,246,142 and operating account interest income of $2.
Liquidity, Capital Resources and Going Concern
On October 11, 2023, we consummated our IPO of 10,000,000 Units. Each Unit consists of one Class A ordinary share, par value $0.0001 and one-half of one redeemable Public Warrant, with each Public Warrant entitling the holder thereof to purchase one Class A ordinary share for $11.50 per share, subject to adjustment, beginning 30 days after the completion of the Company’s initial business combination. We granted Cantor Fitzgerald & Co., as representative of the underwriters (“Cantor”), a 45 day option to purchase up to 1,500,000 additional Units to cover over-allotments. Subsequently, On October 10, 2023, Cantor informed the Company that it will not be exercising the over-allotment option. As a result, the Sponsor forfeited an aggregate of 448,052 Class B ordinary shares. Such forfeited shares were cancelled by the Company prior to the consummation of the IPO.
Simultaneously with the closing of the IPO, we consummated the Private Placement with our Sponsor, who purchased 8,490,535 Private Warrants, generating total proceeds of $8,490,535. The terms of the Private Warrants are identical to the Public Warrants, except that, for so long as the Private Warrants are held by the Sponsor or their permitted transferees, the Private Warrants (i) may not (including the Class A ordinary shares issuable upon exercise of the Private Warrants), subject to certain limited exceptions, be transferred, assigned or sold until 30 days after the completion of the Company’s initial business combination, and (ii) are entitled to registration rights. The Private Warrants will be worthless if the Company does not complete an initial business combination.
A total of $100,500,000 ($10.05 per Unit, which amount includes $3,500,000 of the underwriters’ deferred discount) of the net proceeds from the sale of Units in the IPO and the Private Placements on October 11, 2023 was placed in a trust account maintained for the benefit of the public shareholders at Continental Stock Transfer & Trust Company, as a trustee and was invested only in U.S. government treasury bills 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 of 1940, as amended, and that invest only in direct U.S. government treasury obligations. Except with respect to interest earned on the funds held in the trust account that may be released to the Company to pay its taxes and up to $100,000 of interest to pay dissolution expenses, the funds held in the trust account will not be released from the trust account until the earliest of (i) the completion of the Company’s initial business combination, (ii) the redemption of the Class A ordinary shares included in the Units
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sold in the IPO if we are unable to complete our initial business combination by September 29, 2026, subject to applicable law or (iii) the redemption of any of the public shares properly submitted in connection with a shareholder vote to amend the Company’s amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with its initial business combination or to redeem 100% of its public shares if it has not consummated an initial business combination by September 29, 2026 or (B) with respect to any other material provisions relating to shareholders’ rights or pre-initial business combination activity.
As of June 30, 2026, we had $401,642 in our operating bank account, $25,813,648 in the Trust Account and working capital deficit of $6,048,479.
Subsequent to the consummation of the Initial Public Offering, our liquidity has been satisfied through the net proceeds from the consummation of the Initial Public Offering and the Private Placement held outside of our 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 our officers and directors may, but are not obligated to, provide us working capital loans.
For example, in order to finance our working capital needs, on January 28, 2025, we issued a convertible unsecured promissory note in the principal amount of up to $1,900,000 to the Sponsor, of which we borrowed $1,900,000 as of June 30, 2026. The note does not bear interest and is repayable in full upon consummation of the Company’s initial business combination. Upon the consummation of a business combination, the Sponsor will have the option, but not the obligation, to convert all or a portion of up to $1,500,000 of the unpaid principal balance of the Note into a number of Working Capital Warrants equal to the principal amount of the Note so converted divided by $1.00. The terms of the Working Capital Warrants will be identical to the terms of the Private Warrants. On June 25, 2025, we issued a non-convertible unsecured promissory note in the principal amount of up to $2,500,000 to the Sponsor, of which we borrowed $2,500,000 as of June 30, 2026. The non-convertible unsecured promissory note does not bear interest and is repayable upon the earlier of the consummation of our initial business combination and the last day that we have to complete a business combination. The notes are subject to customary events of default, the occurrence of which automatically trigger the unpaid principal balance of the note and all other sums payable with regard to the notes becoming immediately due and payable.
In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 205 - 40, Presentation of Financial Statements—Going Concern, the Company was formed for the purpose of completing a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities on or before September 29, 2026. There is no assurance that the Company will obtain the necessary approvals or raise the additional capital it needs to fund its business operations and complete any business combination prior to September 29, 2026, if at all. The Company also has no approved plan in place to extend the business combination deadline beyond September 29, 2026, and lacks the capital resources needed to fund operations and complete any business combination, even if the deadline to complete a business combination is extended to a later date. Management has determined that the liquidity condition and timing of liquidation raises substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the issuance of these financial statements. No adjustments have been made to the carrying amounts of assets or liabilities. The Company’s Sponsor, officers and directors may, but are not obligated to, loan the Company funds from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital.
Off-Balance Sheet Arrangements
We had no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of June 30, 2026. 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 an aggregate of $77,500 per month to our management team for their services. Beginning on November 1, 2025 we pay an
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aggregate of $46,249 per month in management fees. We began incurring these fees on May 1, 2021, and will continue to incur these fees monthly until the earlier of the completion of our initial business combination and our liquidation.
The underwriters are entitled to a deferred underwriting commission of 3.5% per unit or $3,500,000 in the aggregate of the gross proceeds of the Initial Public Offering held in the Trust Account upon the completion of our initial Business Combination subject to the terms of the underwriting commission.
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. As of June 30, 2026 and December 31, 2025, we did not have any critical accounting estimates to be made.
Recent Accounting Standards
Other than discussed below, management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.
In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2024-03, “Disaggregation of Income Statement Expenses,” which requires disclosures of certain disaggregated income statement expense captions into specified categories within the footnotes to the financial statements. The requirements of the ASU are effective for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the impact ASU No. 2024-03 will have on its condensed consolidated 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 June 30, 2026, 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 first quarter of 2026 covered by this Quarterly Report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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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 Quarterly Report are any of the risks described in our Annual Report on Form 10-K for the year ended December 31, 2025. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On October 11, 2023, we consummated our Initial Public Offering, registered on the Registration Statement on Form S-1 (File No. 333-273176), which was declared effective by the SEC on September 29, 2023. There has been no material change in the planned use of proceeds from our Initial Public Offering from those that were described in the final prospectus filed pursuant to Rule 424(b) under the Securities Act and other periodic reports previously filed with the SEC.
Item 3. Defaults upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
Securities Trading Plans of Directors and Executive Officers
During our last fiscal quarter, no director or officer, as defined in Rule 16a-1(f),
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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 |
1.1(1) |
| Underwriting Agreement, dated October 5, 2023, by and between the Company and Cantor Fitzgerald & Co., as representative of the underwriters. |
3.1(1) |
| Amended and Restated Memorandum and Articles of Association. |
4.1(1) |
| Warrant Agreement, dated October 5, 2023, by and between the Company and Continental Stock Transfer & Trust Company, as warrant agent. |
10.1(1) |
| Letter Agreement, dated October 5, 2023, by and among the Company, its executive officers, its directors and SLG SPAC Fund LLC. |
10.2(1) |
| Investment Management Trust Agreement, dated October 5, 2023, by and between the Company and Continental Stock Transfer & Trust Company, as trustee. |
10.3(1) |
| Registration Rights Agreement, dated October 5, 2023, by and among the Company, SLG SPAC Fund LLC and the Holders signatory thereto. |
10.4(1) |
| Private Placement Warrants Purchase Agreement, dated October 5, 2023, by and between the Company and SLG SPAC Fund LLC. |
10.5(1) |
| Forward Purchase Agreement, dated October 5, 2023, by and between the Company and SparkLabs Group Management, LLC. |
10.6(1) |
| Indemnity Agreement, dated October 5, 2023, by and between the Company and the officers and directors of the Company. |
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 |
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 (formatted as Inline XBRL and contained in Exhibit 101) |
*Filed herewith.
(1)Previously filed as an exhibit to our Current Report on Form 8-K filed on October 11, 2023 and incorporated by reference herein.
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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.
| SPARK I ACQUISITION CORPORATION | |
|
|
|
Date: August 14, 2026 | By: | /s/ James Rhee |
| Name: | James Rhee |
| Title: | Chairman and Chief Executive Officer |
|
| (Principal Executive Officer) |
|
|
|
Date: August 14, 2026 | By: | /s/ Ho Min (Jimmy) Kim |
| Name: | Ho Min (Jimmy) Kim |
| Title: | Chief Financial Officer |
|
| (Principal Financial and Accounting Officer) |
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