Investcorp Acquisition (IVCA) - 2025 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION This section presents the company's unaudited financial statements, management's analysis, market risk disclosures, and internal controls for the quarter ended March 31, 2025 Item 1. Financial Statements The unaudited condensed financial statements for Q1 2025 reveal a net loss, reduced cash, a working capital deficit, and substantial doubt about the company's going concern status Condensed Balance Sheets As of March 31, 2025, total assets were $18.1 million, largely from the Trust Account, with a $5.11 million shareholders' deficit and significant redeemable shares Condensed Balance Sheet Summary (as of March 31, 2025) | Category | March 31, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $184,577 | $1,032,598 | | Cash and securities held in Trust Account | $17,852,573 | $17,518,993 | | Total Assets | $18,100,900 | $18,551,591 | | Liabilities & Equity | | | | Total Liabilities | $5,354,342 | $5,706,474 | | Class A ordinary shares subject to possible redemption | $17,852,573 | $17,518,993 | | Total Shareholders' Deficit | ($5,106,015) | ($4,673,876) | | Total Liabilities, Redeemable Shares and Deficit | $18,100,900 | $18,551,591 | Condensed Statements of Operations The company reported a net loss of $98,559 for Q1 2025, a reversal from prior-year net income, primarily due to lower trust account interest and no warrant liability fair value adjustment Comparison of Operations (Three Months Ended March 31) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Formation costs and operating expenses | $282,139 | $194,117 | | Interest earned on marketable securities held in Trust Account | $183,580 | $1,399,396 | | Change in FV of warrant liability | $0 | ($870,750) | | Net (Loss) Income | ($98,559) | $334,529 | Condensed Statements of Cash Flows Net cash used in operating activities significantly increased to $848,021 in Q1 2025, with investing activities funded by a Sponsor's convertible promissory note, ending with $184,577 in cash Cash Flow Summary (Three Months Ended March 31) | Cash Flow Activity | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | ($848,021) | ($181,594) | | Net cash used in investing activities | ($150,000) | ($300,000) | | Net cash provided by financing activities | $150,000 | $300,000 | | Net Change in Cash | ($848,021) | ($181,594) | | Cash - End of period | $184,577 | $95,183 | Notes to Condensed Financial Statements The notes detail the company's SPAC status, business combination deadline extension, Nasdaq delisting, going concern doubt due to a working capital deficit, and related-party transactions - The company is a blank check company formed to effectuate a business combination and has not commenced any operations; it will not generate operating revenue until a business combination is completed[23][24] - The deadline to consummate a business combination has been extended to May 12, 2027, following shareholder approval and significant redemptions of Class A ordinary shares[36][38] - The company's securities were delisted from Nasdaq on May 6, 2025, for failing to complete a business combination within 36 months of its IPO effectiveness, and now trade on the OTC Markets[41] - Management has concluded there is substantial doubt about the Company's ability to continue as a going concern due to its working capital deficit and recurring costs in pursuit of an acquisition[43][46] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's SPAC status, Q1 2025 net loss, critical liquidity issues, and reliance on Sponsor loans, raising substantial doubt about its going concern ability - The company is a blank check company seeking a business combination, with an intended focus on the Indian market[116] - For Q1 2025, the company had a net loss of $98,559, consisting of $282,139 in operating costs, partially offset by $183,580 in interest earned from the Trust Account[126] - The company's securities were delisted from Nasdaq in May 2025 and now trade on the OTC Markets, which may adversely affect trading price and liquidity[123] - Management has determined that the company's liquidity condition, with cash of $184,577 and a working capital deficit, raises substantial doubt about its ability to continue as a going concern[133][135] Sponsor Financing (as of March 31, 2025) | Loan Type | Outstanding Amount ($) | Purpose | | :--- | :--- | :--- | | Working Capital Loan | $1,790,000 | Working capital and extension contributions | | Convertible Promissory Note | $1,600,000 | Extension contributions | Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is exempt from providing quantitative and qualitative disclosures about market risk - As a smaller reporting company defined by Rule 12b-2 of the Exchange Act, the company is not required to provide quantitative and qualitative disclosures about market risk[151] Controls and Procedures Management concluded that disclosure controls and procedures were ineffective as of March 31, 2025, due to a material weakness in internal control over financial reporting, with remediation efforts underway - Disclosure controls and procedures were determined to be ineffective as of March 31, 2025[154] - A material weakness was identified related to an ineffective review control, which previously resulted in a material adjustment to accrued expenses[154] - The company is actively working on remediating the material weakness, but sufficient time has not yet elapsed to conclude that the remediation is effective[155][156] PART II. OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, defaults, other information, and exhibits for the reporting period Legal Proceedings The company reports no legal proceedings for the current period - There are no legal proceedings[158] Risk Factors No material changes to previously disclosed risk factors from the IPO prospectus and the most recent Form 10-K have occurred - The company states there have been no material changes to the risk factors disclosed in its prior SEC filings, including the IPO prospectus and the most recent Form 10-K[159] Unregistered Sales of Equity Securities and Use of Proceeds Net proceeds of $266.5 million from the IPO and private placement were placed in the Trust Account, with no material change in their planned use - Net proceeds of $266,512,500 from the Initial Public Offering and Private Placement were placed in the Trust Account[160] - There has been no material change in the planned use of proceeds from the offering[161] Defaults Upon Senior Securities The company reports no defaults upon senior securities - None reported[162] Other Information The company reports no other information for this period - None reported[164] Exhibits This section lists filed exhibits, including officer certifications required by Sarbanes-Oxley and Inline XBRL documents - The report includes officer certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[166] - Inline XBRL financial data files are also included as exhibits[166]