Business Context and Reporting Period
Company: DT Cloud Star Acquisition Corp (DTSQ)
Reporting Period: Quarterly period ended June 30, 2026
Business Type: Cayman Islands exempted company (Special Purpose Acquisition Company - SPAC) formed to effect a business combination. The Company is an emerging growth company and a shell company.
Current Status: The Company entered into a Business Combination Agreement (BCA) on February 2, 2026, with PrimeGen US, Inc. The transaction has not yet been consummated. The Company extended its deadline to complete a business combination to July 26, 2026, with a potential further extension to October 26, 2026.
Key Financial Metrics
| Metric | As of June 30, 2026 | As of Dec 31, 2025 |
|---|---|---|
| Total Assets | $18,466,431 | $17,972,109 |
| Cash (Operating) | $341 | $461 |
| Trust Account Balance | $18,421,078 | $17,876,466 |
| Total Liabilities | $1,715,964 | $1,146,888 |
| Shareholders' Deficit | $(1,670,611) | $(1,051,245) |
| Working Capital Deficit | $(980,611) | $(361,245) |
Results of Operations (Six Months Ended June 30, 2026):
- Net Loss: $(74,754)
- Operating Expenses: $394,383 (Formation/Operating: $334,383; G&A: $60,000)
- Total Other Income: $319,629 (Interest earned in Trust: $266,204; Unrealized gain: $53,408)
- Net Loss per Share (Non-redeemable): $(0.108)
- Net Income per Share (Redeemable): $0.085
Material Changes vs. Prior Period
- Operating Loss Increase: Operating expenses for the six months ended June 30, 2026, increased to $394,383 from $223,570 in the same period in 2025, primarily due to higher formation and operating costs.
- Trust Account Growth: The Trust Account balance increased by approximately $544,612 due to interest income and extension payments deposited by the Sponsor.
- Share Redemption: A significant number of public shares (5,247,491) were tendered for redemption during a shareholder meeting, reducing the number of outstanding public shares to 1,652,509.
- Liquidity Deterioration: The Company reported a working capital deficit of $980,611, indicating a lack of liquidity to sustain operations for a reasonable period without additional funding.
- Related Party Debt: Amounts due to the Sponsor increased from $384,050 to $1,001,144, reflecting advances for operating expenses and extension fees.
Outlook, Risks, and Management Commentary
Business Combination: The Company is pursuing a merger with PrimeGen US, Inc. The transaction is subject to customary closing conditions, including regulatory and shareholder approvals. Management believes the combination will provide an operating business and additional capital.
Liquidity and Going Concern: Management has identified substantial doubt about the Company's ability to continue as a going concern. The Company has minimal operating cash ($341) and relies on the Sponsor for working capital loans and extension payments. If the business combination is not completed by the deadline, the Company will liquidate.
Extension Strategy: The Company has extended its business combination deadline to July 26, 2026, with the option to extend further to October 26, 2026, by depositing $75,000 per month into the Trust Account. As of June 30, 2026, $375,000 in extension payments had been deposited.
Listing Status: The Company was notified of non-compliance with Nasdaq Global Market listing standards (Market Value of Listed Securities and shareholder count). On July 27, 2026, Nasdaq approved the transfer of the Company's listing to the Nasdaq Capital Market, effective July 29, 2026.
Risks:
- Failure to consummate a business combination by the deadline will result in mandatory liquidation.
- Further share redemptions could reduce cash available outside the Trust Account, jeopardizing the ability to meet minimum cash conditions for the merger.
- Continued compliance with Nasdaq Capital Market listing requirements is not guaranteed.
Investor Verification Checklist
- Merger Status: Verify the current status of the Business Combination Agreement with PrimeGen US, Inc. and any updates on closing conditions.
- Liquidity Runway: Confirm the Company's ability to fund operations and extension fees through the July 26, 2026 deadline given the $341 operating cash balance.
- Redemption Impact: Assess the impact of the 5.2 million share redemption on the Trust Account balance per share and the Company's ability to meet minimum cash requirements for the merger.
- Nasdaq Compliance: Monitor the Company's adherence to Nasdaq Capital Market listing standards following the transfer from the Global Market.
- Sponsor Support: Review the terms of the promissory notes and working capital loans from the Sponsor to ensure continued funding availability.