IBAC 10-K & 10-Q changes, risk factors and insider trading
IB Acquisition Corp. (also IBACR) · Nasdaq · Services-Commercial Physical & Biological Research · CIK 1998781 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Changes in international trade policies, tariffs and treaties affecting imports and exports may have a material adverse effect on our search for an initial business combination target, our ability to complete an initial business combination, and/or our business, financial condition and results of operations following completion of an initial business combination.”
Largest changes
“Changes in international trade policies, tariffs and treaties affecting imports and exports may have a material adverse effect on our search for an initial business combination target, our ability to complete an initial business combination, and/or our business, financial condition and results of operations following completion of an initial business combination.”see in full comparison
“There have recently been significant changes to international trade policies and tariffs affecting imports and exports. The U.S. has implemented a range of new tariffs and increases to existing tariffs, and, in response to the tariffs announced by the U.S., other countries have imposed new or increased tariffs on certain exports from the United States. There is currently significant uncertainty about the future relationship between the United States and other countries with respect to trade policies, government regulations and tariffs. …”see in full comparison
“The COVID-19 pandemic resulted in a widespread health crisis and adversely affected economies and financial markets in the U.S. and worldwide, and could continue to adversely affect the business of any potential target company with which we consummate a business combination. …”see in full comparison
Our search forsee in full comparisonaan initial business combination, and any target business with which we ultimately consummateouran initial business combination, maymaybe materially adversely affected bythenewcoronavirusoutbreaks, or continuation of any existing outbreaks, of any infectious disease (such as COVID-19)pandemic,and other events, and the status ofthedebt and equitycapitalmarkets.
In addition, our ability to consummatesee in full comparisonaantransactioninitial business combination may be dependent on the ability to raise equity and debtfinancing,financing which may be impacted byCOVID-19outside events (such as terrorist attacks, natural disasters orotheraglobalsignificantpandemicsoutbreakandofotherinfectiousevents,diseases), including as a result of increased marketvolatilityvolatility, decreased market liquidityandin third-party financing being unavailable on terms acceptable to us or at all.Finally, the outbreak of COVID-19 or other global pandemics may also have the effect of heightening many of the other risks described in this “Risk Factors” section, such as those related to the market for our securities and cross-border transactions.
“Any new outbreaks, or continuation of any existing outbreaks, of any infectious disease (such as COVID-19) or other events (such as terrorist attacks, armed conflicts or natural disasters) could adversely affect economies and financial markets worldwide, and the business of any potential target business with which we consummate an initial business combination could be materially and adversely affected. …”see in full comparison
Full comparison: every changed paragraph (19)
We
may engage our underwriters or one of their respective affiliates to provide additional services to us, including, for example, identifying
potential targets, providing financial advisory services, acting as a placement agent in a private offering or arranging debt financing
transactions. We may pay such underwriters or their respective affiliates fair and reasonable fees or other compensation that would be
determined at that time in an arm’s length negotiation; provided that no agreement will be entered into with the underwriters or
their respective affiliates and no fees or other compensation for such services will be paid to the underwriters or their respective
affiliates prior to the date that is 60 days from the date of our initial public offering, unless such payment would not be deemed underwriting
compensation in connection with our initial public offering. We have a board of directors comprised of a majority of independent directors,
our initial stockholders have approximately 24.68%67.14 % ownership of our common stock, and, as such, we believe any transactions between
us us
and our underwriter will be conducted on an arm’s length basis. However, due to the relationship between our sponsor and our
underwriter, underwriter,
any negotiations between our company and our underwriter may be deemed not to have been entered into on an arm’s length
basis. basis.
Such underwriters or their respective affiliates’ financial interests tied to the consummation of a business combination
transaction transaction
will give rise to potential conflicts of interest in providing any such additional services to us, including potential conflicts
of interest
in connection with the sourcing and consummation of an initial business combination.
We
may not hold a stockholder vote to approve our initial business combination unless the business combination would require stockholder
approval under applicable state law or the rules of Nasdaq or if we decide to hold a stockholder vote for business or other reasons.
For instance, the Nasdaq rules currently allow us to engage in a tender offer in lieu of a stockholder meeting but would still require
us to obtain stockholder approval if we were seeking to issue more than 20% of our outstanding shares to a target business as consideration
in any business combination. Therefore, if we were structuring a business combination that required us to issue more than 20% of our
outstanding shares, we would seek stockholder approval of such business combination. However, except for as required by law, the decision
as to whether we will seek stockholder approval of a proposed business combination or will allow stockholders to sell their shares to
us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the
transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. Even if we seek stockholder
approval, the holders of our founder shares will participate in the vote on such approval. Accordingly, we may consummate our initial
business combination even if holders of a majority of the outstanding shares of our common stock do not approve of the business combination
we consummate. Please see the section entitled “Proposed Business —- Stockholders May Not Have the Ability to Approve Our Initial
Initial Business Combination” for additional information.
Unlike
many other blank check companies in which the initial stockholders, officers and directors agree to vote their founder shares in accordance
with the majority of the votes cast by the public stockholders in connection with an initial business combination, our initial stockholders,
officers and directors have agreed to vote their founder shares, private placement shares, and any public shares purchased during or
after our initial public offering, in favor of our initial business combination. Our initial stockholders will own 24.68%67.14% of our outstanding
shares of common stock immediately following the completion of our initial public offering. As a result, in addition to the founder shares
and private placement shares held by our sponsor and the 350,000 Representative shares held by I-Bankers, we would not need 3,129,745, or
approximately 31.3%,any of the
10,000,000 public shares sold as part of the units in our initial public offering, to be voted in favor of a transaction (assuming all
all outstanding shares are voted) in order to have our initial business combination approved (assuming the underwriters’ over-allotment
option is not exercised). Furthermore, assuming only the minimum number of stockholders required to be present at the stockholders’
meeting held to approve our initial business combination are present at such meeting, in addition to the founder shares and private placement
shares held by our initial stockholders and the 350,000 Representative shares held by I-Bankers, we would not need any of the 10,000,000
public shares sold as part of the units in our initial public offering, to be voted in favor of our initial business combination in order
to have such transaction approved (assuming the underwriters’ over-allotment option is not exercised). In addition, in the event
that our board of directors amends our bylaws to reduce the number of shares required to be present at a meeting of our stockholders,
we would need even fewer public shares to be voted in favor of our initial business combination to have such transaction approved.
Any
potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete
our initial business combination within 18 months from the closingcombination of our initial public offering.period. Consequently, such target business
may obtain leverage over us in negotiating
a business combination, knowing that if we do not complete our initial business combination
with that particular target business, we
may be unable to complete our initial business combination with any target business. This risk
will increase as we get closer to the
timeframe described above. In addition, we may have limited time to conduct due diligence and may
enter into our initial business combination
on terms that we would have rejected upon a more comprehensive investigation.
If
the net proceeds of our initial public offering and the sale of the private placement units not being held in the trust account are insufficient
to allow us to operate for at least 18 months following the closingcombination of our initial public offering,period, we may be unable to complete our
initial business combination, in which case
our public stockholders may only receive $10.05 per share, or less than such amount in certain
circumstances, and our rights will expire
worthless.
The
funds available to us outside of the trust account may not be sufficient to allow us to operate for at least 18the monthscombination following theperiod,
closing of our initial public offering, assuming that our initial business combination is not completed during that time. We believe
that the funds available to us outside of
the trust account will be sufficient to allow us to operate for at least 18 months following
the closingcombination of our initial public offeringperiod; however, we cannot assure you that our
estimate is accurate. Of the funds available to us,
we could use a portion of the funds available to us to pay fees to consultants to
assist us with our search for a target business. We
could also use a portion of the funds as a down payment or to fund a “no-shop”
provision (a provision in letters of intent
designed to keep target businesses from “shopping” around for transactions with
other companies on terms more favorable to
such target businesses) with respect to a particular proposed business combination, although
we do not have any current intention to
do so. If we entered into a letter of intent where we paid for the right to receive exclusivity
from a target business and were subsequently
required to forfeit such funds (whether as a result of our breach or otherwise), we might
not have sufficient funds to continue searching
for, or conduct due diligence with respect to, a target business. If we are unable to
complete our initial business combination, our
public stockholders may receive only approximately $10.05 per share on the liquidation
of our trust account and our rights will expire
worthless. In certain circumstances, our public stockholders may receive less than $10.05
per share upon our liquidation.
In
light of the involvement of our initial stockholders, executive officers and directors with other entities, we may decide to acquire
one or more businesses affiliated with our initial stockholders, executive officers and directors. Our directors also serve as officers
and board members for other entities, including, without limitation, those described under “Management —- Conflicts of Interest.”
Such entities may compete with us for business combination opportunities. Our initial stockholders, officers and directors are not currently
aware of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated,
and there have been no preliminary discussions concerning a business combination with any such entity or entities. Although we will not
be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined
that such affiliated entity met our criteria for a business combination as set forth in “Proposed Business —- Effecting our initial
initial business combination —- Selection of a target business and structuring of our initial business combination” and such transaction
transaction was approved by a majority of our disinterested directors. Despite our agreement to obtain an opinion from an independent investment
investment banking firm, or from an independent accounting firm, regarding the fairness to our company from a financial point of view
of a business
combination with one or more domestic or international businesses affiliated with our executive officers or directors,
potential conflicts
of interest still may exist and, as a result, the terms of the business combination may not be as advantageous to
our public stockholders
as they would be absent any conflicts of interest.
Our
search for aan initial business combination, and any target business with which we ultimately consummate ouran initial business combination,
may may
be materially adversely affected by thenew coronavirusoutbreaks, or continuation of any existing outbreaks, of any infectious disease (such as
COVID-19) pandemic,and other events, and the status of the debt and equity capital markets.
Any new outbreaks, or continuation of any existing outbreaks, of any infectious disease (such as COVID-19) or other events (such as terrorist attacks, armed conflicts or natural disasters) could adversely affect economies and financial markets worldwide, and the business of any potential target business with which we consummate an initial business combination could be materially and adversely affected. Furthermore, we may be unable to complete an initial business combination if concerns relating to any outbreak of a disease restricts travel or limits the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers. The extent to which any new outbreak or the continuation of any existing situation impacts our search for an initial business combination will depend on future developments, which are highly uncertain and cannot be predicted. If any such event (such as terrorist attacks, natural disasters or a significant outbreak of other infectious diseases) continues for an extensive period of time, our ability to consummate an initial business combination, or the operations of a target business with which we ultimately consummate an initial business combination, may be materially adversely affected.
The
COVID-19 pandemic resulted in a widespread health crisis and adversely affected economies and financial markets in the U.S. and worldwide,
and could continue to adversely affect the business of any potential target company with which we consummate a business combination.
In addition, our ability to complete a transaction may be dependent on the ability to raise equity and debt financing which may be impacted
by COVID-19 or other global pandemics and other events, including as a result of increased market volatility, decreased market liquidity
and third-party financing being unavailable on terms acceptable to us or at all.
In
addition, our ability to consummate aan transactioninitial business combination may be dependent on the ability to raise equity and debt financing, financing
which may be impacted
by COVID-19outside events (such as terrorist attacks, natural disasters or othera globalsignificant pandemicsoutbreak andof otherinfectious events, diseases),
including as a result of increased market volatilityvolatility, decreased market liquidity
and in third-party financing being unavailable on terms
acceptable to us or at all. Finally, the outbreak of COVID-19 or other global pandemics
may also have the effect of heightening many of the other risks described in this “Risk Factors” section, such as those related
to the market for our securities and cross-border transactions.
Changes in international trade policies, tariffs and treaties affecting imports and exports may have a material adverse effect on our search for an initial business combination target, our ability to complete an initial business combination, and/or our business, financial condition and results of operations following completion of an initial business combination.
There have recently been significant changes to international trade policies and tariffs affecting imports and exports. The U.S. has implemented a range of new tariffs and increases to existing tariffs, and, in response to the tariffs announced by the U.S., other countries have imposed new or increased tariffs on certain exports from the United States. There is currently significant uncertainty about the future relationship between the United States and other countries with respect to trade policies, government regulations and tariffs. We cannot predict whether, and to what extent, current tariffs will continue, or trade policies will change in the future. Any significant increases in tariffs on goods or materials or other changes in trade policy, or the perception that such changes could occur, could negatively affect our search for a target business and/or our ability to complete an initial business combination. For example, if we pursue a target company which sources or manufactures material components outside of the U.S., these changes could materially impact such target company’s business and financial performance. Similarly, if we pursue a target company which exports products outside of the U.S., retaliatory tariff and trade measures imposed by other countries could affect such target’s ability to export products and therefore adversely affect its sales. We may not be able to adequately address the risks presented by these tariffs or other potential trade policy changes. As a result, we may deem it costly, impractical or risky to complete an initial business combination with a particular target or with a target in a particular industry or from a particular country. Consequently, the pool of potential target companies may be reduced, which could impair our ability to identify a suitable target and to complete an initial business combination. The business prospects of a target company could change even after we enter into a business combination agreement, as a result of tariffs or the threat of tariffs that may have a material impact on the target’s business. Accordingly, changes in trade and tariff policies could prevent or make it difficult or more expensive for us to complete an initial business combination. Tariffs and threats of tariffs and other potential trade policy changes could also lead to material adverse effects on our post-business combination company.
For
a complete discussion of our executive officers’ and directors’ business affiliations and the potential conflicts of interest
that you should be aware of, please see “Management —- Directors and Executive Officers,” “Management —
- Conflicts of
Interest” and “Certain Relationships and Related Party Transactions.”
Our
public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (i) the completion of
our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a stockholder vote to
amend our amended and restated articles of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our
public shares if we do not complete our initial business combination within 18 months from the closingcombination ofperiod our initial public offering
or (B) with respect to any other provision
relating to stockholders’ rights or pre-business combination activity and (iii) the
redemption of all of our public shares if we
are unable to complete our business combination within 18 months from the closingcombination of our
initial public offering,period, subject to applicable law and as further described herein.
Stockholders who do not exercise their rights to
the funds in connection with an amendment to our articles of incorporation would still
have rights to the funds in connection with a
subsequent business combination. In no other circumstances will a public stockholder have
any right or interest of any kind in the trust
account. Accordingly, to liquidate your investment, you may be forced to sell your public
shares or rights, potentially at a loss.
We
may issue a substantial number of additional shares of common stock, and may issue shares of preferred stock, in order to complete our
initial business combination or under an employee incentive plan after completion of our initial business combination (although our amended
and restated articles of incorporation provide that we may not issue securities that can vote with common stockholders on matters related
to our pre-business combination activity). The price at which we issue any shares may be lower than the price you paid for the units
in our initial public offering or at a price lower than the trading price of our common stock at the time we commit to such issuance
or at the actual issuance of such shares. However, our amended and restated articles of incorporation provide, among other things, that
prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof
to (i) receive funds from the trust account or (ii) vote on any initial business combination. These provisions of our amended and restated
articles of incorporation, like all provisions of our amended and restated articles of incorporation, may be amended with a stockholder
vote. However, our initial stockholders, executive officers and directors have agreed, pursuant to a written agreement with us, that
they will not propose any amendment to our amended and restated articles of incorporation (A) to modify the substance or timing of our
obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing
ofcombination our initial public offeringperiod or
(B) with respect to any other provision relating to stockholders’ rights or pre-business combination
activity, unless we provide
our public stockholders with the opportunity to redeem their shares of common stock upon approval of any
such amendment at a per-share
price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest
(which interest shall
be net of taxes payable), divided by the number of then outstanding public shares. The issuance of additional shares
of common or preferred
stock:
Our
initial stockholders own 24.68%67.14 % of our issued and outstanding shares of common stock. Accordingly, our initial stockholders may
exert exert
a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support, including amendments
to our amended and restated articles of incorporation and approval of major corporate transactions. If our initial stockholders purchase
any units in our initial public offering or additional shares of common stock in the aftermarket or in privately negotiated transactions,
this would increase their influence.
In
recent years, the United States and other markets have experienced cyclical or episodic downturns, and worldwide economic conditions
remain uncertain, including as a result of the ongoing COVID-19 pandemic, supply chain disruptions, the Ukraine-Russia conflict, conflicts
in the Middle East, instability
in the U.S. and global banking systems, rising fuel prices, increasing interest rates or foreign exchange
rates and high inflation and
the possibility of a recession.
The
price of our securities may vary significantly due to one or more potential business combinations and general market or economic conditions,conditions.
including as a result of the COVID-19 pandemic. Furthermore, an active trading market for our securities may never develop or, if developed,
it may not be sustained. You may be unable
to sell your securities unless a market can be established and sustained.
Management's Discussion & Analysis (MD&A)
New heading “Factors That May Adversely Affect our Results of Operations”
Largest changes
“Our results of operations and our ability to complete an initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond our control. …”see in full comparison
We have neither engaged in any operations nor generated any revenues to date. Our only activities from July 7, 2020 (inception) through September 30,see in full comparison20242025, were organizational activities, those necessary to prepare for theinitialInitialpublicPublicofferingOffering,(defineddescribedbelow),below, andsubsequent to the initial public offering,identifying a target company for abusinessBusinesscombination.Combination. We do not expect to generate any operating revenues until after the completion of ourbusinessBusinesscombination.Combination. We generate non-operating income in the form of interestincomeand dividends earned onmarketablecashsecuritiesand investments held in thetrustTrustaccount.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.
“In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this ASU require disclosures, on an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating officer decision maker (“CODM”), as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. …”see in full comparison
“In August 2020, the FASB issued ASU 2020 06, “Debt—Debt with Conversion and Other Options (Subtopic 470 20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815 40)” (“ASU 2020 06”), to simplify certain financial instruments. ASU 2020 06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. …”see in full comparison
For the year ended September 30,see in full comparison2024,2025, cash used in operating activities was$820,959.$1,318,100. Net income of$1,867,387$3,416,169 wasimpactedaffected by the interest and dividends earned onmarketablecashsecuritiesand investments held intheTrusttrust accountAccount of$3,026,873$5,130,712 andchangeschange in operating assets and liabilities which provided $396,443 of$338,527.cash for operating activities.
Full comparison: every changed paragraph (13)
We
have neither engaged in any operations nor generated any revenues to date. Our only activities from July 7, 2020 (inception) through
September 30, 20242025, were organizational activities, those necessary to prepare for the initialInitial publicPublic offeringOffering, (defineddescribed below),below, and
subsequent to the initial public offering, identifying a target company for a businessBusiness combination.Combination. We do not expect to generate any
operating revenues until after the completion
of our businessBusiness combination.Combination. We generate non-operating income in the form of interest income
and dividends earned on marketablecash securitiesand investments held
in the trustTrust account.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 year ended September 30, 2024,2025, we had a net income of $1,867,387,$3,416,169, which consists of interest incomeand dividends earned on cash and investments
held in the
trustTrust accountAccount of $3,026,873$5,130,712, partially offset by provision for income taxes of $635,512$965,635 and operating costs of $523,974.$748,908.
For
the year ended September 30, 2023,2024, we had a net lossincome of $6,844,$1,867,387, which consists of interest and dividends earned on cash and investments
held in Trust Account of $3,026,873 offset by provision for income taxes of $635,512 and operating costs.costs of $523,974.
Factors That May Adversely Affect our Results of Operations
Our results of operations and our ability to complete an initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond our control. Our results of operations and our ability to consummate an initial Business Combination could be impacted by, among other things, downturns in the financial markets or in economic conditions, increases in oil prices, inflation, fluctuations in interest rates, increases in tariffs, supply chain disruptions, declines in consumer confidence and spending, public health considerations, and geopolitical instability, such as the military conflicts in Ukraine and the Middle East. We cannot at this time predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact our business and our ability to complete an initial Business Combination.
For
the year ended September 30, 2024,2025, cash used in operating activities was $820,959.$1,318,100. Net income of $1,867,387$3,416,169 was impactedaffected by the interest
and dividends earned on marketablecash securitiesand investments held in theTrust trust accountAccount of $3,026,873$5,130,712 and changeschange in operating assets and liabilities which
provided $396,443 of $338,527.cash for operating activities.
For
the year ended September 30, 2023,2024, cash used in operating activities was $207.$820,959. Net lossincome of $6,844$1,867,387 was impacted by interest
earned on cash and investments held in the trust account of $3,026,873 and changes in operating
assets and liabilities of $6,637.$338,527.
As
of September 30, 2024,2025, we held cash and investments held in the Trust Account of $118,601,873.$15,890,194. The Trust Account can only be invested in U.S.
government treasury
obligations with a maturity of 185 days or less or interests in money market funds meeting certain conditions under
Rule 2a-7 under the
Investment Company Act, which invest only in direct U.S. government treasury obligations. We may withdraw interest
from the Trust Account
to pay taxes, if any. We intend to use substantially all of the funds held in the Trust Account, including any
amounts representing interest
earned on the Trust Account (less taxes payable), to complete our initial Business Combination. To the
extent that our capital stock
or debt is used, in whole or in part, as consideration to complete our initial Business Combination, the
remaining proceeds held in the
Trust Account will be used as working capital to finance the operations of the target business or businesses,
make other acquisitions
and pursue our growth strategies.
As
of September 30, 2024,2025, we had cash of $822,799.$428,700 and restricted cash of $787,365. 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, and structure, negotiate and complete a Business Combination.
Critical
Accounting PoliciesEstimates
The
preparation of financial statements and related disclosures in conformity with GAAP 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
not identified any critical accounting policiesestimates as of September 30, 2024.2025.
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this ASU require disclosures, on an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating officer decision maker (“CODM”), as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. The ASU requires that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. Public entities will be required to provide all annual disclosures currently required by Topic 280 in interim periods, and entities with a single reportable segment are required to provide all the disclosures required by the amendments in this ASU and existing segment disclosures in Topic 280. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 became effective as of December 31, 2024 and our management adopted ASU 2023-07 in our financial statements and related disclosures (see Note 10).
In
August 2020, the FASB issued ASU 2020 06, “Debt—Debt with Conversion and Other Options (Subtopic 470 20) and Derivatives
and Hedging— Contracts in Entity’s Own Equity (Subtopic 815 40)” (“ASU 2020 06”), to simplify certain financial
instruments. ASU 2020 06 eliminates the current models that require separation of beneficial conversion and cash conversion features
from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts
in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments
that are indexed to and settled in an entity’s own equity. ASU 2020 06 amends the diluted earnings per share guidance, including
the requirement to use the if-converted method for all convertible instruments. ASU 2020 06 is effective for fiscal years beginning after
December 15, 2023 and should be applied on a full or modified retrospective basis. Early adoption is permitted, but no earlier than fiscal
years beginning after December 15, 2020, including interim periods within those fiscal years. The Company adopted ASU 2020 06 as of January
1, 2024. There was no effect to the Company’s presented financial statements.
What changed in the latest 10-Q
Risk Factors
Full comparison: every changed paragraph (1)
In
connection with the special meeting held on March 25, 2026 at which our stockholders approved the Second Extension Amendment, stockholders
holding 731,741 shares of our common stock exercised their right to redeem their shares for cash, resulting in approximately $7.9 million
being removed from the Trust Account. Following these redemptions, approximately $8.2 million remained in the Trust Account as of MarchJune
31,30, 2026. The reduced amount in the Trust Account may make it more difficult for us to satisfy the minimum net tangible asset and other
closing conditions of any initial business combination, including the Business Combination contemplated by the BCA, and may reduce the
per-share liquidation value of the Trust Account if we are unable to consummate the Business Combination within the Combination Period.
Management's Discussion & Analysis (MD&A)
Largest changes
“As of June 30, 2026, the Company had $30,161 in cash, $0 in restricted cash and a working capital deficit of $2,190,878. …”see in full comparison
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 but not limited to: the inability to consummate the GNQ Business Combination within the Combination Period; further stockholder redemptions reducing the funds available in the Trust Account; financing shortfalls and the Company’s inability to obtain additional capital on acceptable terms; the Company’s going-concern risk and limited cash outside the Trust Account; ineffective disclosure controls and procedures and potential material weaknesses in internal control over financial reporting; the complexity of the cross-border and exchangeable-share structure of the proposed Business Combination; dilution from the Bridge Financing, convertible notes, and warrants; and that the other 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”) on December 29, 2025. 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.see in full comparison
Prior to the Closing, the Company will enter into separate Lock-Up Agreements (each a “Lock-Up Agreement”) with a number of GNQsee in full comparisonGNQshareholders and Sponsor pursuant to which the securities of the Company and ExchangeCo held by such holders will be locked-up and subject to transfer restrictions for a period of time following the Closing, as described below, subject to certain exceptions. The securities held by such GNQ shareholders will be locked-up until the earlier of: (i) six (6) months after the date of the Closing, and (ii) subsequent to the Closing, the date on which SPAC consummates a liquidation, merger, capital stock exchange, reorganization, or other similar transaction that results in all of SPAC’s stockholders having the right to exchange their SPAC Common Stock for cash, securities or other property; provided, that if the closingtrading price of the SPAC Common Stock on the stock exchange on which the SPAC Common Stock is listed exceeds US$12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 Trading Days within any 30-day Trading Day period, then Holder shall have the right to sell 50% of its SPAC Common Stock subject to applicable regulatory restrictions, and if the closingtrading price of the SPAC Common Stock on the stock exchange on which the SPAC Common Stock is listed exceedsUS$15.00US$12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 Trading Days within any 30-day Trading Day period, then Holder shall have the right to sellan the remaining50% of its SPAC Common Stock subject to applicable regulatory restrictions, and if the closing trading price of the SPAC Common Stock on the stock exchange on which the SPAC Common Stock is listed exceeds US$15.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 Trading Days within any 30-day Trading Day period, then Holder shall have the right to sell the remaining 50% of its SPAC Common Stock subject to applicable regulatory restrictions.
“We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business Combination. …”see in full comparison
In connection with the Company’s assessment of going concern considerations in accordance with the authoritative guidance in Financial Accounting Standard Board (“FASB”) Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that the Company currently lacks the liquidity it needs to sustain operations for a reasonable period of time, which is considered to be at least one year from the date that the financial statements are issued as it expects to continue to incur significant costs in pursuit of its acquisition plans. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management plans to address this uncertainty by seeking additional Sponsor loans, pursuing third-party financing including throughsee in full comparisonathe Bridge Financing and potential PIPE investments, and consummating the BusinessCombination.Combination by September 28, 2026. If the Company is unable to consummate the Business Combination or another initial business combination within the Combination Period, which currently expires on September 28, 2026, the Company will be required to cease operations, redeem the Public Shares, and liquidate. There is no assurance that the Company’s plans to raise capital or to consummate a Business Combination will be successful within the Combination Period. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
“During the period ended June 30, 2026, the Sponsor loaned the Company $500,000 on a non-interest bearing, due-on-demand basis. As of June 30, 2026, the total amount due to Sponsor was $500,000 (see Note 5). Additional Sponsor funding is not committed and is at the Sponsor’s discretion.”see in full comparison
Full comparison: every changed paragraph (17)
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 but not limited to: the inability to consummate the GNQ Business Combination within the Combination Period; further stockholder redemptions reducing the funds available in the Trust Account; financing shortfalls and the Company’s inability to obtain additional capital on acceptable terms; the Company’s going-concern risk and limited cash outside the Trust Account; ineffective disclosure controls and procedures and potential material weaknesses in internal control over financial reporting; the complexity of the cross-border and exchangeable-share structure of the proposed Business Combination; dilution from the Bridge Financing, convertible notes, and warrants; and that the other 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”) on December 29, 2025. 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.
Prior
to the Closing, the Company will enter into separate Lock-Up Agreements (each a “Lock-Up Agreement”) with a number of GNQ
GNQ shareholders and Sponsor pursuant to which the securities of the Company and ExchangeCo held by such holders will be locked-up
and subject
to transfer restrictions for a period of time following the Closing, as described below, subject to certain exceptions.
The securities
held by such GNQ shareholders will be locked-up until the earlier of: (i) six (6) months after the date of the
Closing, and (ii) subsequent
to the Closing, the date on which SPAC consummates a liquidation, merger, capital stock exchange,
reorganization, or other similar transaction
that results in all of SPAC’s stockholders having the right to exchange their
SPAC Common Stock for cash, securities or other property;
provided, that if the closing trading price of the SPAC Common Stock on
the stock exchange on which the SPAC Common Stock is listed exceeds US$12.00 per share (as adjusted for stock splits, stock
dividends, reorganizations, recapitalizations and the like) for any 20 Trading Days within any 30-day Trading Day period, then
Holder shall have the right to sell 50% of its SPAC Common Stock subject to applicable regulatory restrictions, and if the closing
trading price of the SPAC Common Stock on the stock exchange on which the SPAC Common Stock is listed exceeds US$15.00
US$12.00 per share (as
adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 Trading
Days within any
30-day Trading Day period, then Holder shall have the right to sell an the remaining 50% of its SPAC Common Stock subject to applicable
regulatory restrictions, and if the closing trading price of the SPAC Common Stock on the stock exchange on which the SPAC Common Stock
is listed exceeds US$15.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like)
for any 20 Trading Days within any 30-day Trading Day period, then Holder shall have the right to sell the remaining 50% of its SPAC
Common Stock subject to applicable regulatory restrictions.
We
have neither engaged in any operations nor generated any revenues to date. Our only activities from July 7, 2020 (inception) through
MarchJune 31,30, 2026, were organizational activities, those necessary to prepare for the 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 and dividends earned on cash and investments 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 MarchJune 31,30, 2026, we had a net loss of $639,866,$567,166, which consists of provision for income taxes of $28,791$15,222 and operatinggeneral
costsand administrative expenses of $748,177,$624,429, partially offset by interest and dividends earned on cash and investments held in Trust Account
of $137,102.$72,485.
For
the three months ended MarchJune 31,30, 2025, we had a net income of $824,126,$818,610, which consists of interest and dividends earned on cash and investments
held in Trust Account of $1,250,141,$1,254,202, offset by operational costs of $163,485$172,210 and provision for income taxes of $262,530.$263,382.
For
the sixnine months ended MarchJune 31,30, 2026, we had a net loss of $698,768,$1,265,934, which consists of provision for income taxes of $60,982$76,204 and operatinggeneral
costsand administrative expenses of $928,177,$1,552,606, partially offset by interest and dividends earned on cash and investments held in Trust Account
of $290,391.$362,876.
For
the sixnine months ended MarchJune 31,30, 2025, we had a net income of $1,731,194,$2,549,804, which consists of interest and dividends earned on cash and investments
held in Trust Account of $2,621,671,$3,875,873, offset by operational costs of $339,926$512,136 and provision for income taxes of $550,551.$813,933.
For
the sixnine months ended MarchJune 31,30, 2026, cash used in operating activities was $1,316,431.$1,790,904. Net loss of $698,768$1,265,934 was affected by the interest
and dividends earned on cash and investments held in Trust Account of $290,391$362,876 and change in operating assets and liabilities which usedprovided
$327,272$162,094 of cash for operating activities.
For
the sixnine months ended MarchJune 31,30, 2025, cash used in operating activities was $1,119,424.$1,260,781. Net income of $1,731,194$2,549,804 was affected by the interest
and dividends earned on cash and investments held in Trust Account of $2,621,671$3,875,873 and change in operating assets and liabilities which
used $228,947$65,288 of cash for operating activities.
As
of MarchJune 31,30, 2026, we held cash and investments held in Trust Account of $8,188,994.$8,261,479. The Trust Account can only be invested in U.S. government
treasury obligations with a maturity of 185 days or less or interests in money market funds meeting certain conditions under Rule 2a-7
under the Investment Company Act, which invest only in direct U.S. government treasury obligations. We may withdraw interest from the
Trust Account to pay taxes, if any. We intend to use substantially all of the funds held in the Trust Account, including any amounts
representing interest earned on the Trust Account (less taxes payable), to complete our initial Business Combination. To the extent that
our capital stock or debt is used, in whole or in part, as consideration to complete our initial Business Combination, the remaining
proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make
other acquisitions and pursue our growth strategies.
As
of MarchJune 31,30, 2026, we had cash of $4,634$30,161 and restricted cash of $0. 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, and structure, negotiate and complete a Business Combination.
During the period ended June 30, 2026, the Sponsor loaned the Company $500,000 on a non-interest bearing, due-on-demand basis. As of June 30, 2026, the total amount due to Sponsor was $500,000 (see Note 5). Additional Sponsor funding is not committed and is at the Sponsor’s discretion.
As of June 30, 2026, the Company had $30,161 in cash, $0 in restricted cash and a working capital deficit of $2,190,878. In connection with the Company’s assessment of going concern considerations in accordance with the authoritative guidance in Financial Accounting Standard Board (“FASB”) Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that the Company currently lacks the liquidity it needs to sustain operations for a reasonable period of time, which is considered to be at least one year from the date that the financial statements are issued as it expects to continue to incur significant costs in pursuit of its acquisition plans. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management plans to address this uncertainty through a Business Combination. There is no assurance that the Company’s plans to raise capital or to consummate a Business Combination will be successful within the Combination Period. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
We
do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However,
if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination
are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business
Combination. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated
to redeem a significant number of our Public Shares upon consummation of our Business Combination, in which case we may issue additional
securities or incur debt in connection with such Business Combination.
In
connection with the Company’s assessment of going concern considerations in accordance with the authoritative guidance in Financial
Accounting Standard Board (“FASB”) Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties
about an Entity’s Ability to Continue as a Going Concern,” management has determined that the Company currently lacks the
liquidity it needs to sustain operations for a reasonable period of time, which is considered to be at least one year from the date that
the financial statements are issued as it expects to continue to incur significant costs in pursuit of its acquisition plans. These conditions
raise substantial doubt about the Company’s ability to continue as a going concern. Management plans to address this uncertainty
by seeking additional Sponsor loans, pursuing third-party financing including through athe Bridge Financing and potential PIPE investments,
and consummating the Business Combination.Combination by September 28, 2026. If the Company is unable to consummate the Business Combination or another
initial business combination within the Combination Period, which currently expires on September 28, 2026, the Company will be required
to cease operations, redeem the Public Shares, and liquidate. There is no assurance that the Company’s plans to raise capital or
to consummate a Business Combination
will be successful within the Combination Period. The financial statements do not include any adjustments
that might result from the
outcome of this uncertainty.
We
have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of MarchJune 31,30, 2026. We do not participate
participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest
interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.
The
preparation of financial statements and related disclosures in conformity with GAAP 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
not identified any critical accounting estimates as of MarchJune 31,30, 2026.
IBAC insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
No Form 4 stock transactions in this period.
Well-known investors holding IBAC (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| D. E. Shaw & Co. | 2026-06-30 | 150,000 | $17.8K | 0.0% | No change |