D. Boral ARC Acquisition I Corp Unit(BCARU) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION This section presents the unaudited financial statements and related notes for D. Boral ARC Acquisition I Corp. as of June 30, 2025 Item 1. Financial Statements This section presents the unaudited financial statements and comprehensive notes for D. Boral ARC Acquisition I Corp. as of June 30, 2025 Balance Sheet This section details the company's financial position, including assets, liabilities, and shareholders' deficit Balance Sheet as of June 30, 2025 | ASSETS | | :--- | | Cash | $25,000 | | Deferred offering costs | $173,041 | | Total Assets | $198,041 | | LIABILITIES AND SHAREHOLDERS' DEFICIT | | Promissory note – related party | $214,461 | | Total Current Liabilities | $214,461 | | Class B ordinary Shares (12,321,429 issued and outstanding) | $1,232 | | Additional paid-in capital | $23,768 | | Accumulated deficit | $(41,420) | | Total Shareholder's Deficit | $(16,420) | | Total Liabilities and Shareholder's Deficit | $198,041 | Statements of Operations This section presents the company's net income (loss) and operating costs for the periods ended June 30, 2025 Statements of Operations (Unaudited) | Metric | For the three months ended June 30, 2025 | For the Period from March 20, 2025 (Inception) through June 30, 2025 | | :--- | :--- | :--- | | Formation and operating costs | $(36,000) | $(41,420) | | Net Income (Loss) | $(36,000) | $(41,420) | | Weighted average shares outstanding, basic and diluted | 10,714,286 | 10,714,286 | | Basic and diluted net income per share | $(0.00) | $(0.00) | Statement of Changes in Shareholders' Deficit This section outlines changes in the company's shareholder's deficit from inception through June 30, 2025 Statement of Changes in Shareholders' Deficit (Unaudited) | Item | Balance – March 20, 2025 (inception) | Class B ordinary shares issued to Sponsor | Net loss (March 31, 2025) | Proceeds from issuance of Class B ordinary shares to Sponsor | Net loss (June 30, 2025) | Balance – June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Class B Ordinary shares (Shares) | - | 12,321,429 | - | - | - | 12,321,429 | | Class B Ordinary shares (Amount) | $ - | $ 1,232 | $ - | $ - | $ - | $ 1,232 | | Additional Paid-In Capital | $ - | $ 23,768 | $ - | $ - | $ - | $ 23,768 | | Accumulated Deficit | $ - | $ - | $ (5,420) | $ - | $ (36,000) | $ (41,420) | | Subscription Receivable | $ - | $ (25,000) | $ - | $ 25,000 | $ - | $ - | | Total Shareholder's Deficit | $ - | $ - | $ (5,420) | $ 25,000 | $ (36,000) | $ (16,420) | Statement of Cash Flows This section details the company's cash flows from operating and financing activities through June 30, 2025 Statement of Cash Flows (Unaudited) | Cash Flows from Operating Activities | | :--- | | Net Loss | $(41,420) | | Adjustments to reconcile net loss to net cash used in operating activities: | | Formation and operating costs paid by Sponsor under Promissory Note – Related Party | $41,420 | | Net cash used in operating activities | $ - | | Cash flows from financing activities: | | Proceeds from issuance of Class B ordinary shares to Sponsor | $25,000 | | Net cash provided by financing activities | $25,000 | | Net change in cash | $25,000 | | Cash at the beginning of the period | $ - | | Cash at the end of the period | $25,000 | | Supplemental disclosure of non-cash financing activities: | | Deferred offering costs included in promissory note | $173,041 | Notes to Financial Statements This section provides detailed explanations of the accounting policies and financial statement items for the period Note 1: Description of Organization, Business Operations This note describes the company's formation, blank check purpose, and pre-IPO activities - D. Boral ARC Acquisition I Corp. was incorporated on March 20, 2025, as a blank check company in the British Virgin Islands, aiming to effect a business combination[27] - The company had not commenced operations by June 30, 2025, with activities focused on formation and its Initial Public Offering (IPO)[28] - The IPO of 25,000,000 units at $10.00 per unit, generating $250,000,000 gross proceeds, was consummated on August 1, 2025, with an additional $2,000,000 from a private placement[29][30] - Following the IPO, $250,000,000 was placed in a Trust Account, to be invested in U.S. government securities or money market funds, for the sole purpose of facilitating a business combination[32] - The company had $25,000 cash and a working capital deficit of $189,461 as of June 30, 2025, with liquidity needs met by a Sponsor payment and loan, which was repaid post-IPO[40][41] Note 2: Summary of Significant Accounting Policies This note outlines the key accounting principles and policies applied in preparing the financial statements - The financial statements are presented in U.S. Dollars in conformity with GAAP and SEC rules[43] - The company is an 'emerging growth company' and has elected not to opt out of the extended transition period for new or revised financial accounting standards, which may affect comparability[44][46] - Offering costs associated with the IPO are allocated between Class A ordinary shares subject to redemption and warrants, with $3,438,859 allocated to redeemable shares and $143,775 to warrants[50] - The company is not subject to income taxes in the British Virgin Islands or the United States, resulting in a de minimis provision for income taxes[53] - Public shares with redemption features are classified as temporary equity, and their carrying value is adjusted to equal the redemption value at each reporting period end[55] - The company's financial instruments' fair value approximates their carrying amounts due to their short-term nature[58] - Geopolitical instability from the Russia-Ukraine and Israel-Hamas conflicts could adversely affect the company's search for a business combination[59][60] Note 3: Initial Public Offering This note details the terms and proceeds of the company's Initial Public Offering on August 1, 2025 - On August 1, 2025, the company consummated its IPO of 25,000,000 units at $10.00 per unit, generating gross proceeds of $250,000,000[63] - Each unit consists of one Ordinary Share and one-half of one redeemable warrant, with each whole warrant exercisable for one Class A ordinary share at $11.50[63] Note 4: Private Placement This note describes the private placement of units to the Sponsor concurrent with the IPO - Simultaneously with the IPO closing, the Sponsor purchased 200,000 Private Units at $10.00 per unit, raising $2,000,000[64] - Proceeds from the Private Units were added to the Trust Account, and if no business combination is completed, these proceeds will fund public share redemptions, and private warrants will expire worthless[65] Note 5: Related Party Transactions This note outlines transactions and agreements between the company and its related parties, including the Sponsor - On March 25, 2025, the company issued 12,321,429 founder shares (Class B ordinary shares) to the Sponsor for $25,000 cash, with some shares subject to forfeiture[66] - The Sponsor issued an unsecured promissory note to the company on March 20, 2025, allowing borrowing up to $350,000 for offering costs; $214,461 was borrowed by June 30, 2025, and repaid post-IPO[69] - An affiliate of the Sponsor provides administrative services for $20,000 per month, commencing from Nasdaq listing[70] - The Sponsor or affiliates may provide Working Capital Loans up to $2,500,000, convertible into private units, to finance business combination transaction costs[71] - On August 1, 2025, the company issued 1,000,000 Representative Shares to D. Boral Capital, LLC as compensation, subject to a 180-day lock-up period[72] Note 6: Commitments and Contingencies This note details the company's various commitments and potential contingent liabilities - Holders of founder shares, Private Units, and working capital loan conversion units have registration rights, including demand and 'piggy-back' rights[73] - The underwriters were granted a 45-day option to purchase up to 3,750,000 additional units for over-allotments and received 1,000,000 Representative Shares as compensation, with no cash underwriting fee at closing[74][75] Note 7: Stockholder's Equity This note describes the company's authorized and outstanding share capital and warrant terms - The company is authorized to issue 5,000,000 preference shares and 500,000,000 Class A ordinary shares, with no preference or Class A shares outstanding as of June 30, 2025[76][77] - As of June 30, 2025, there were 12,321,429 Class B ordinary shares issued and outstanding, held by the Sponsor, with some subject to forfeiture[78] - Class B ordinary shares automatically convert to Class A ordinary shares on a one-for-one basis upon business combination, subject to anti-dilution adjustments[79] - Warrants become exercisable 30 days after business combination completion, allowing purchase of Class A ordinary shares at $11.50, and expire five years from combination or earlier upon redemption/liquidation[81] Note 8: Fair Value Measurements This note explains the company's fair value hierarchy and valuation methods for financial instruments - The company uses a fair value hierarchy (Level 1, 2, 3) to classify assets and liabilities based on observable and unobservable inputs[85][86] Fair Value Measurements as of August 1, 2025 | Item | Level | 2025 | | :--- | :--- | :--- | | Fair value of over-allotment liability | 3 | $1,290,375 | | Fair value of Public Warrants for Class A ordinary shares subject to possible redemption allocation | 3 | $8,061,250 | - The over-allotment option liability was valued using a Black-Scholes model, classified as Level 3 due to unobservable inputs like expected share-price volatility, expected life, and risk-free interest rate[89] - Public Warrants were valued using a Monte Carlo Simulation Model and classified within shareholders' equity, not requiring remeasurement after issuance[90] Note 9: Segment Information This note clarifies that the company operates as a single segment, with the CFO reviewing overall results - The company has only one operating segment, as its Chief Financial Officer (CODM) reviews operating results for the company as a whole[91][92] - Key metrics reviewed by the CODM include formation and operating costs, which totaled $(41,420) for the period from inception through June 30, 2025[92] Note 10: Subsequent Events This note discloses significant events after the reporting period, including IPO and private placement closings - On August 1, 2025, the company consummated its IPO of 25,000,000 units, generating gross proceeds of $250,000,000[94] - Simultaneously, a private placement of 200,000 units to the Sponsor generated $2,000,000[95] - On August 11, 2025, underwriters partially exercised the over-allotment option, purchasing 3,000,000 additional units for $30,000,000, closing on August 13, 2025[96] - Following these closings, $280,000,000 from net proceeds was placed in a trust account[97] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial condition, operational results, liquidity, and capital resources as a blank check company Overview This section summarizes the company's purpose and funding strategy for its business combination - D. Boral ARC Acquisition I Corp. is a blank check company formed on March 20, 2025, to effect a business combination[100] - The company plans to fund its initial Business Combination using cash from its IPO, private placement, sale of securities, or a combination of cash, stock, and debt[100] Results of Operations This section details the company's financial performance, primarily consisting of formation and operating costs - The company has not generated any operating revenues to date, with activities focused on organization and preparing for the IPO[102] Net Loss | Period | Net Loss | | :--- | :--- | | Three months ended June 30, 2025 | $(36,000) | | March 20, 2025 (inception) through June 30, 2025 | $(41,420) | Liquidity and Capital Resources This section discusses the company's cash position, funding, and plans for financing a business combination - As of June 30, 2025, the company had $25,000 in cash and a working capital deficit of $189,461[104] - Post-IPO, the company consummated its IPO of 25,000,000 units for $250,000,000 and a private placement of 200,000 units for $2,000,000[105][106] - The underwriters partially exercised their over-allotment option, purchasing 3,000,000 additional units for $30,000,000, bringing the total trust account to $280,000,000[107][97] - Funds outside the Trust Account will be used for identifying and evaluating acquisition candidates and performing due diligence[109] - The company has 18 months from the IPO closing, with a possible three-month extension, to consummate a Business Combination, or it will redeem public shares[111] Off-Balance Sheet Financing Arrangements This section confirms the absence of any off-balance sheet arrangements, obligations, assets, or liabilities - The company has no off-balance sheet arrangements, obligations, assets, or liabilities[112][113] Contractual Obligations This section details the company's commitments, including administrative service reimbursements, and lack of long-term debt - The company has no long-term debt, capital lease obligations, operating lease obligations, or long-term liabilities[114] - The company will reimburse its Sponsor, MFH 1, LLC, $20,000 per month for office space, secretarial, and administrative support until a Business Combination or liquidation[114] Critical Accounting Estimates This section states no critical accounting estimates were disclosed as of June 30, 2025 - As of June 30, 2025, the company did not have any critical accounting estimates to disclose[115] Item 3. Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide quantitative and qualitative disclosures about market risk - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[116] Item 4. Controls and Procedures Management assessed disclosure controls and procedures as effective, with no material changes in internal control over financial reporting Evaluation of Disclosure Controls and Procedures Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025 - Management concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025[119] Changes in Internal Control over Financial Reporting No material changes in the company's internal control over financial reporting occurred during the fiscal quarter - There were no material changes in the company's internal control over financial reporting during the fiscal quarter ended June 30, 2025[120] PART II - OTHER INFORMATION This section provides additional information not covered in the financial statements, including legal, risk, and control disclosures Item 1. Legal Proceedings No litigation is currently pending against the company, its officers, or directors, to management's knowledge - No litigation is currently pending against the company, its officers, or directors[122] Item 1A. Risk Factors As a smaller reporting company, risk factors are not required in this report; refer to the IPO prospectus for additional risks - As a smaller reporting company, the company is not required to include risk factors in this report[123] - For additional risks, readers are referred to the 'Risk Factors' section of the company's Form S-1 IPO prospectus[123] Item 1C. Cybersecurity As a blank check company, cybersecurity relies on third parties, with management periodically assessing and managing potential risks - As a blank check company, D. Boral ARC Acquisition I Corp. has no operations of its own facing material cybersecurity threats, relying on third-party digital technologies and personnel[125] - The company acknowledges potential for corruption or misappropriation of assets, proprietary information, and sensitive data due to sophisticated attacks or security breaches in systems utilized by itself or third parties[125] - Management has established processes for identifying, evaluating, and managing material risks from cybersecurity threats, which are reassessed periodically[125] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There are no unregistered sales of equity securities or use of proceeds to report for the period - No unregistered sales of equity securities or use of proceeds to report[126] Item 3. Defaults Upon Senior Securities There are no defaults upon senior securities to report for the period - No defaults upon senior securities[127] Item 4. Mine Safety Disclosures Mine Safety Disclosures are not applicable to D. Boral ARC Acquisition I Corp. - Mine Safety Disclosures are not applicable to the company[128] Item 5. Other Information There is no other information to report for the period - No other information to report[128] Item 6. Exhibits This section lists all exhibits filed with or incorporated by reference into this Quarterly Report on Form 10-Q Exhibits Filed | No. | Description of Exhibits | | :--- | :--- | | 31.1* | Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-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) and 15(d)-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.CAL* | Inline XBRL Instance Document | | 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | | 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | | 101.LAB* | Inline XBRL Taxonomy Extension Labels 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) |