Business Context and Reporting Period
Company: Cal Redwood Acquisition Corp. (CRAQ)
Reporting Period: Quarter ended June 30, 2025 (Inception: January 7, 2025)
Business Type: Cayman Islands exempted corporation (Special Purpose Acquisition Company/SPAC).
Status: The Company is a "blank check" company with no operating revenues. Its sole purpose is to effect a business combination. On May 27, 2025, the Company consummated its Initial Public Offering (IPO) of 23,000,000 Units (including full over-allotment exercise) and a simultaneous private placement of 660,000 Units.
Key Financial Metrics
| Metric | Value (as of June 30, 2025) |
|---|---|
| Total Assets | $232,310,661 |
| Cash and Cash Equivalents (Operating) | $1,392,179 |
| Trust Account Balance | $230,868,152 |
| Net Income (3 Months Ended June 30, 2025) | $599,557 |
| Net Income (Inception to June 30, 2025) | $556,735 |
| Total Liabilities | $9,317,280 |
| Deferred Underwriting Fee | $9,200,000 |
| Working Capital Surplus | $1,325,229 |
| Shares Outstanding (Class A) | 23,660,000 (23,000,000 subject to redemption) |
| Shares Outstanding (Class B) | 7,665,900 |
Material Changes and Operational Highlights
- Capital Raise: Gross proceeds of $230,000,000 from the IPO and $6,600,000 from the private placement were raised in May 2025. $230,000,000 was deposited into the Trust Account.
- Trust Account Growth: The Trust Account balance increased from the initial $230,000,000 to $230,868,152 due to earnings on investments (U.S. Treasury Bills) of $868,152.
- Expense Structure: The Company incurred $136,379 in general and administrative costs for the quarter. A significant non-cash compensation expense of $132,300 was recorded related to the transfer of founder shares to independent directors.
- Transaction Costs: Total transaction costs amounted to $14,320,654, comprising $4,600,000 in cash underwriting fees, $9,200,000 in deferred underwriting fees, and $520,654 in other offering costs.
Outlook, Risks, and Contingencies
- Completion Window: The Company has 24 months from the IPO closing (May 27, 2027) to complete a business combination. If unsuccessful, the Company will liquidate and redeem public shares.
- Liquidity: Management believes current cash and working capital loans (up to $300,000 promissory note from Sponsor, currently $301 outstanding) are sufficient to fund operations for at least one year. Additional working capital loans up to $2,500,000 may be available from the Sponsor, convertible into units post-combination.
- Geopolitical Risks: The filing highlights risks associated with the Russia-Ukraine and Israel-Hamas conflicts, which could impact global markets, capital availability, and the ability to identify or complete a target acquisition.
- Redemption Rights: Public shareholders have the right to redeem their shares for a pro-rata portion of the Trust Account (approx. $10.04 per share as of June 30, 2025) upon the completion of a business combination or liquidation.
Investor Verification Checklist
- Trust Account Composition: Verify that the $230.8M in the Trust Account remains invested in U.S. government treasury obligations or money market funds as required.
- Deferred Underwriting Fee: Confirm the $9.2M deferred fee liability is contingent solely on the successful completion of a business combination.
- Share Redemption Value: Monitor the per-share redemption value in the Trust Account, which fluctuates with interest earnings and potential tax liabilities.
- Related Party Transactions: Review the status of the $301 promissory note to the Sponsor and any potential future "Working Capital Loans" that may dilute shareholders if converted.
- Target Search Progress: Assess the timeline for identifying a target, given the 24-month deadline to avoid liquidation.