Business Context and Reporting Period
Company: Cal Redwood Acquisition Corp. (CRA)
Filing Type: Form 10-Q (Quarterly Report)
Reporting Period: Quarter and six months ended June 30, 2026
Business Overview: Cal Redwood is a Cayman Islands exempted corporation formed as a "blank check" company (SPAC) for the purpose of effecting a business combination. The Company consummated its Initial Public Offering (IPO) on May 27, 2025, selling 23,000,000 Units at $10.00 per unit. As of June 30, 2026, the Company has not commenced any operations and is actively searching for a target business. The Company has until May 27, 2027, to complete an initial business combination or face mandatory liquidation.
Key Financial Metrics
| Metric | As of June 30, 2026 | As of Dec 31, 2025 |
|---|---|---|
| Cash and Cash Equivalents (Operating) | $821,425 | $1,096,942 |
| Trust Account Balance | $239,776,741 | $235,633,565 |
| Total Assets | $240,732,895 | $236,871,137 |
| Total Liabilities | $9,597,830 | $9,379,542 |
| Deferred Underwriting Fee | $9,200,000 | $9,200,000 |
| Working Capital Surplus | $558,324 | $1,019,496 |
Results of Operations (Six Months Ended June 30, 2026)
- Net Income: $3,643,470
- General and Administrative Expenses: $515,257
- Earnings on Investments in Trust Account: $4,143,176
- Interest Income (Operating Account): $15,551
- Net Income Per Share (Basic & Diluted): $0.12 (Redeemable Class A); $0.12 (Non-redeemable Class A/B)
Material Changes vs. Prior Period
- Trust Account Growth: The Trust Account balance increased by approximately $4.14 million from December 31, 2025, to June 30, 2026, driven by earnings on investments (U.S. Treasury Bills and money market funds). The per-share redemption value increased from $10.24 to $10.43.
- Operating Cash Flow: Net cash used in operating activities was $200,517 for the six months ended June 30, 2026, compared to $151,248 for the period from inception through June 30, 2025. This usage is primarily due to general and administrative expenses.
- Accretion of Redemption Value: The Company recorded accretion of Class A ordinary shares to redemption value of $2,101,551 for the quarter ended June 30, 2026, increasing the accumulated deficit.
- Liabilities: Accounts payable and accrued expenses increased from $74,547 to $346,536, and amounts due to affiliates increased from $29,694 to $50,993.
Outlook, Risks, and Contingencies
- Going Concern: Management has determined that the mandatory liquidation date of May 27, 2027, raises substantial doubt about the Company's ability to continue as a going concern if a business combination is not completed. The financial statements do not include adjustments that might result from this uncertainty.
- Liquidity: The Company has $821,425 in operating cash. To fund working capital deficiencies, the Sponsor or affiliates may provide "Working Capital Loans" up to $2,500,000, which may be convertible into units post-combination. As of June 30, 2026, no such loans were outstanding.
- Geopolitical Risks: The filing highlights risks related to global market volatility stemming from the Russia-Ukraine conflict, the Israel-Hamas conflict, and escalating tensions in the Middle East, which could impact the search for a target business.
- Redemption Rights: Public shareholders have the right to redeem their shares for a pro-rata portion of the Trust Account upon the completion of a business combination or if the Company fails to complete one by the deadline.
Investor Verification Checklist
- Trust Account Yield: Verify the current interest rate environment and its impact on the Trust Account balance, which directly influences the redemption price per share.
- Operating Burn Rate: Monitor the $515,257 in G&A expenses for the six-month period to assess if the current operating cash ($821,425) is sufficient to sustain operations until May 2027 without additional Sponsor loans.
- Deferred Underwriting Fee: Confirm the $9,200,000 deferred fee obligation, which is payable only upon the successful completion of a business combination.
- Share Count: Verify the outstanding share count: 23,000,000 Public Shares (subject to redemption) and 7,665,900 Founder Shares (Class B), noting that the over-allotment option was fully exercised.
- Related Party Transactions: Review the $50,993 due to affiliates and the $301 promissory note balance to understand ongoing financial dependencies on the Sponsor.