Business Context and Reporting Period
Company: Cal Redwood Acquisition Corp. (CRA)
Filing Type: Form 10-K (Annual Report)
Reporting Period: Fiscal year ended December 31, 2025 (Inception: January 7, 2025)
Business Overview: Cal Redwood is a Cayman Islands exempted company and a "blank check" Special Purpose Acquisition Company (SPAC). It was formed to effect a merger, share exchange, or asset acquisition with one or more target businesses, primarily focusing on the Technology, Media, and Telecommunications (TMT) sectors. The company has no operating history and generated no operating revenues to date.
Capitalization Event: On May 27, 2025, the company consummated its Initial Public Offering (IPO) of 23,000,000 units at $10.00 per unit, including the full exercise of the underwriters' over-allotment option. Simultaneously, it sold 660,000 private placement units.
Key Financial Metrics
| Metric | Value (as of Dec 31, 2025) |
|---|---|
| Net Income | $5,054,949 |
| Operating Expenses | $467,994 (General & Admin) + $132,300 (Compensation) |
| Trust Account Balance | $235,633,565 |
| Per Share Trust Value | $10.24 |
| Cash (Outside Trust) | $1,096,942 |
| Total Assets | $236,871,137 |
| Total Liabilities | $9,379,542 |
| Deferred Underwriting Fee | $9,200,000 |
| Working Capital Surplus | $1,019,496 |
Material Changes and Operational Highlights
- Revenue Generation: The company has no operating revenue. Net income of $5.05 million is derived entirely from non-operating sources: $5.63 million in earnings on investments held in the Trust Account and $26,678 in interest income from the operating bank account.
- Trust Account Growth: The Trust Account balance increased from the initial deposit of $230,000,000 to $235,633,565 due to interest earnings on U.S. Treasury Bills.
- Share Structure: As of March 31, 2026, there were 23,660,000 Class A ordinary shares and 7,665,900 Class B ordinary shares (Founder Shares) issued and outstanding. The Class B shares represent approximately 25% of the outstanding shares.
- Transaction Costs: Total transaction costs incurred were $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.
Guidance, Outlook, and Risks
Outlook and Timeline: The company has until May 27, 2027 (24 months from the IPO) to consummate an initial business combination. If no combination is completed by this date, the company will liquidate and redeem public shares at the pro-rata Trust Account balance.
Management Commentary: Management intends to focus on targets in the TMT sector or sectors transformed by technology disruption. They plan to use the Trust Account proceeds, private placement proceeds, and potentially additional financing (debt or equity) to complete a transaction.
Key Risks and Contingencies:
- Liquidity Risk: While the company currently has a working capital surplus, it may require additional financing (Working Capital Loans) from the Sponsor or affiliates to fund operations or transaction costs. Up to $2.5 million of such loans may be convertible into private placement units.
- Redemption Risk: Public shareholders have the right to redeem their shares for cash upon the completion of a business combination or upon liquidation. High redemption rates could reduce the cash available for the transaction.
- Geopolitical Risk: The filing highlights risks associated with the Russia-Ukraine conflict and the Israel-Hamas conflict, which could disrupt capital markets and affect the ability to identify or complete a target.
- Investment Company Act Risk: The company must manage its Trust Account investments to avoid being classified as an unregistered investment company under the Investment Company Act of 1940.
Investor Verification Checklist
- Trust Account Status: Verify the current balance of the Trust Account and the per-share redemption value, noting that it is currently $10.24 per share.
- Extension Provisions: Review the terms under which the company may seek shareholder approval to extend the May 27, 2027 deadline for a business combination.
- Related Party Transactions: Confirm the terms of the Sponsor's indemnification obligations regarding third-party claims against the Trust Account and the status of any Working Capital Loans.
- Deferred Fees: Note the $9.2 million deferred underwriting fee payable only upon the successful completion of a business combination.
- Target Selection: Acknowledge that no specific target business has been selected, and the company has no operating history to evaluate.