QETA 10-Q
Quetta Acquisition Corp (QETA)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
For
the quarterly period ended
For the transition period from to
Commission
File No.
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices, including zip code)
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☐ | Large accelerated filer | ☐ | Accelerated filer |
| ☒ | Smaller reporting company | ||
| Emerging growth company | |||
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes
As of August 14 , 2026, there were shares of the registrant’s common stock, including shares of common stock underlying the units, $ par value per share, issued and outstanding.
TABLE OF CONTENTS
| i |
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
QUETTA ACQUISITION CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, 2026 | December 31, 2025 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses and other assets | ||||||||
| Other current asset | ||||||||
| Total Current Assets | ||||||||
| Cash and investments held in Trust Account | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current Liabilities | ||||||||
| Due to related party - administrative fee | $ | $ | ||||||
| Due to related party | ||||||||
| Due to SKG | ||||||||
| Other Liability | ||||||||
| Accounts payable and accrued expenses | ||||||||
| Franchise tax payable | ||||||||
| Excise tax payable | ||||||||
| Promissory note –related party | ||||||||
| Promissory note – KM QUAD | ||||||||
| Total Current Liabilities | ||||||||
| Deferred underwriting fee payable | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies | ||||||||
| Common stock subject to possible redemption, $ par value; shares authorized; shares issued and outstanding at redemption value of $ and $ as of June 30, 2026 and December 31, 2025, respectively | ||||||||
| Stockholders’ Deficit | ||||||||
| Common stock, $ par value; shares authorized; shares issued and outstanding (excluding shares subject to possible redemption as of June 30, 2026 and December 31, 2025, respectively) | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Stockholders’ Deficit | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
| 1 |
QUETTA ACQUISITION CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, |
|||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Formation and operation costs | $ | $ | $ | $ | ||||||||||||
| Related Party Administrative Fees | ||||||||||||||||
| Franchise tax expenses | ||||||||||||||||
| Loss from operations | ( | ) | ( | ) | ( |
) |
( |
) | ||||||||
| Other Income (expense): | ||||||||||||||||
| Interest income | ||||||||||||||||
| Interest earned on cash and investments held in Trust Account | ||||||||||||||||
| Gain on forgiveness of promissory notes | ||||||||||||||||
| Interest and penalties on excise tax payable | ( | ) | ( |
) | ||||||||||||
| Income (loss) before income taxes | ( | ) | ( |
) | ||||||||||||
| Provision for income taxes | ( | ) | ( | ) | ( |
) | ( |
) | ||||||||
| Net income (loss) | $ | $ | ( | ) | $ | $ | ( |
) | ||||||||
| Basic and diluted weighted average shares outstanding, common stock subject to possible redemption | ||||||||||||||||
| Basic and diluted net income (loss) per share, redeemable common stock | $ | $ | ) | $ | $ | ) | ||||||||||
| Basic and diluted weighted average shares outstanding, common stock | ||||||||||||||||
| Basic and diluted net income (loss) per share, non redeemable common stock | $ | $ | ) | $ | $ | ) | ||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
| 2 |
QUETTA ACQUISITION CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
(Unaudited)
For the Three and Six Months ended June 30, 2026
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balance–December 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Remeasurement of common stock subject to possible redemption | - | ( | ) | ( | ) | |||||||||||||||
| Extension fees attributable to common stock subject to redemption | - | ( | ) | ( | ) | |||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balance–March 31, 2026 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Remeasurement of common stock subject to possible redemption | - | ( | ) | ( | ) | |||||||||||||||
| Extension fees attributable to common stock subject to redemption | - | ( | ) | ( | ) | |||||||||||||||
| Net income | - | |||||||||||||||||||
| Balance–June 30, 2026 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
For the Three and Six Months ended June 30, 2025
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balance–December 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Remeasurement of common stock subject to possible redemption | - | ( | ) | ( | ) | |||||||||||||||
| Extension fees attributable to common stock subject to redemption | - | ( | ) | ( | ) | |||||||||||||||
| Excise tax imposed on common stock redemptions | - | ( | ) | ( | ) | |||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balance–March 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Remeasurement of common stock subject to possible redemption | - | ( | ) | ( | ) | |||||||||||||||
| Extension fees attributable to common stock subject to redemption | - | ( | ) | ( | ) | |||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balance–June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
| 3 |
QUETTA ACQUISITION CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six Months Ended June 30, |
||||||||
| 2026 | 2025 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net income (loss) | $ | $ | ( |
) | ||||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
| Interest earned on cash and investments held in Trust Account | ( |
) | ( |
) | ||||
| Gain on forgiveness of promissory notes | ( |
) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses and other assets | ( |
) | ( |
) | ||||
| Accounts payable and accrued expenses | ||||||||
| Income tax payable | ( |
) | ||||||
| Franchise tax payable | ( |
) | ||||||
| Excise tax payable | ||||||||
| Due to related party | ||||||||
| Due to related party - administrative fee | ( |
) | ||||||
| Net cash used in operating activities | ( |
) | ( |
) | ||||
| Cash Flows from Investing Activities: | ||||||||
| Cash withdrawn from Trust Account to pay redeemed public stockholders | ||||||||
| Cash deposited into Trust Account for term extensions | ( |
) | ( |
) | ||||
| Cash deposited into Trust Account for repayment of amount previously withdrawn | ( |
) | ||||||
| Cash withdrawn from Trust Account to pay taxes | ||||||||
| Net cash provided by (used in) investing activities | ( |
) | ||||||
| Cash Flows from Financing Activities: | ||||||||
| Proceeds from related party | ||||||||
| Repayment to related party | ( |
) | ||||||
| Payment to redeemed public stockholders | ( |
) | ||||||
| Proceeds from SKG | ||||||||
| Proceeds from promissory note - related party | ||||||||
| Proceeds from promissory note - KM QUAD | ||||||||
| Net cash provided by (used in) financing activities | ( |
) | ||||||
| Net Changes in Cash | ( |
) | ||||||
| Cash - Beginning of period | ||||||||
| Cash - End of period | $ | $ | ||||||
| Supplemental Disclosure of Cash Flow Information | ||||||||
| Cash paid for income taxes | $ | $ | ||||||
| Supplemental Disclosure of Non-cash Financing Activities: | ||||||||
| Extension fees attributable to common stock subject to redemption | $ | $ | ||||||
| Excise tax imposed on common stock redemptions | $ | $ | ||||||
| Remeasurement of common stock subject to possible redemption | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited consolidated financial statements.
| 4 |
QUETTA
ACQUISITION CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 — Description of Organization, Business Operations and Going Concern
Quetta Acquisition Corporation (the “Company” or “Quetta”) is a blank check company incorporated as a Delaware Corporation on May 1, 2023. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (“Business Combination”). The Company intends to focus on target businesses in Asia.
As of June 30, 2026, the Company had not commenced any operations. All activity for the six months ended June 30, 2026, are related to the Company’s formation and the initial public offering (“IPO” as defined below) and subsequent to the IPO, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the IPO. The Company has selected December 31 as its fiscal year end. The Company’s sponsor is Yocto Investments LLC (the “Sponsor”), a Delaware limited liability company.
The
registration statement for the Company’s IPO became effective on October 5, 2023. On October 11, 2023, the Company consummated
the IPO of units (the “Public Units’), including the full exercise of the over-allotment option of Units
granted to the underwriters. The Public Units were sold at an offering price of $ per unit generating gross proceeds of $
Transaction
costs amounted to $
Upon
the closing of the IPO and the private placement on October 11, 2023, a total of $
Pursuant
to Nasdaq listing rules, the Company’s initial Business Combination must occur with one or more target businesses having an aggregate
fair market value equal to at least
| 5 |
The Company will provide its holders of the outstanding Public Shares (the “Public Stockholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The Public Stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $ per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its franchise and income tax obligations). The Public Shares subject to redemption will be recorded at a redemption value and classified as temporary equity upon the completion of the Proposed Offering in accordance with the Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.”
The
Company will proceed with a Business Combination if the Company has net tangible assets of at least $
If the Company seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Amended and Restated Certificate of Incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than an aggregate of 20% or more of the Public Shares, without the prior consent of the Company.
The Initial Stockholders have agreed (a) to waive their redemption rights with respect to the Founder Shares, Private Shares, and Public Shares held by them in connection with the completion of a Business Combination and (b) not to propose, or vote in favor of, an amendment to the Amended and Restated Certificate of Incorporation that would affect the substance or timing of the Company’s obligation to redeem % of its Public Shares if the Company does not complete a Business Combination, unless the Company provides the Public Stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.
If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest (which interest shall be net of taxes payable, and less certain amount of interest to pay dissolution expenses) divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
The Sponsor and the other Initial Stockholders have agreed to waive their liquidation rights with respect to the Founder Shares, and Private Shares if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor or the other Initial Stockholders acquires Public Shares in or after the IPO, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within in the Combination Period and, in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than $.
| 6 |
In order to protect the amounts held in the Trust Account, the Sponsor has agreed to be liable to the Company if and to the extent any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below $ per Public Share, except as to any claims by a third party who executed a valid and enforceable agreement with the Company waiving any right, title, interest or claim of any kind they may have in or to any monies held in the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third party claims.
Quad Global Inc. (“Quad Global”), is a wholly owned subsidiary of the Company and is a Cayman Island exempted company formed on February 5, 2025. It was formed to be the surviving company after the reincorporation merger in connection with a contemplated business combination. It has no principal operations or revenue producing activities.
Quad Group Inc., is a wholly owned subsidiary of the Quad Global and is a Cayman Island exempted company formed on January 28, 2025. It was formed to be the Merger Sub in connection with a contemplated business combination. It has no principal operations or revenue producing activities.
January 2025 Stockholder Meeting
On
January 10, 2025, the Company held a special meeting of stockholders (the “January Special Meeting”). During the January
Special Meeting, stockholders approved an amendment to the Company’s second amended and restated certificate of incorporation (the
“A&R Certificate of Incorporation”) to extend the date by which the Company has to consummate a business combination
from January 10, 2025 to October 10, 2026 (36 months from the consummation of the Company’s initial public offering), on a month-by-month
basis, up to a total of 21 times, by depositing $
In
connection with the stockholders’ vote at the January Special Meeting, an aggregate of shares with redemption value of
approximately $
Following
the January Special Meeting, the Company deposited $
Termination of Merger Agreement with KM QUAD
On
February 14, 2025, Quetta entered into an Agreement and Plan of Merger (the “KM QUAD Merger Agreement”) with KM QUAD, Quad
Global Inc., Quad Group Inc., certain shareholders of KM QUAD and the shareholders’ representative. The KM QUAD Merger Agreement
contemplated, among other things, the redomestication of Quetta into Purchaser and the acquisition by Purchaser of 100% of the issued
and outstanding equity interests of KM QUAD. The aggregate consideration payable to KM QUAD shareholders was $
In connection to the Merger agreement the Company entered into unsecured promissory notes with KM QUAD, (see note 9).
On January 15, 2026, the parties entered into a Termination Agreement pursuant to which the KM QUAD Merger Agreement was terminated.
Business Combination Agreement with Smart Kreate Group Limited
On March 6, 2026, Quetta, SMART KREATE GROUP LIMITED, an exempted company limited by shares incorporated under the laws of the Cayman Islands (“PubCo”), SKG Merger Sub 1 Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a wholly owned subsidiary of PubCo (“Merger Sub 1”), SKG Merger Sub 2 Limited, a business company with limited liability incorporated under the laws of the British Virgin Islands and a wholly owned subsidiary of PubCo (“Merger Sub 2”), and Smart Kreate Group Limited, a business company with limited liability incorporated under the laws of the British Virgin Islands (“SKG”), entered into a Business Combination Agreement (the “BCA”).
| 7 |
Shareholder Support Agreement
On or around the date of the BCA , certain shareholders of SKG entered into Shareholder Support Agreements with QETA, SKG and PubCo (the “Shareholder Support Agreement”), pursuant to which each such shareholder of the Company has agreed to, among other things, (i) vote all Company shares held by such shareholder in favor of the transactions contemplated by the BCA and the other transaction documents, (ii) vote against any proposals that would or would be reasonably likely to in any material respect impede the transactions contemplated by the BCA, (iii) not transfer any share of SKG until termination of the Shareholder Support Agreement, and (iv) within certain periods of time from the closing of the Business Combination and subject to certain exceptions, not sell, transfer, tender, grant, pledge, assign or otherwise dispose of (including by gift, tender or exchange offer, merger or operation of law), encumber, hedge or utilize a derivative to transfer the economic interest in any of the shares of PubCo issued in connection with the Acquisition Merger or upon settlement of equity awards issued by PubCo.
Sponsor Support Agreement
Concurrently with the execution of the Business Combination Agreement, QETA, PubCo, SKG, the Sponsor and certain directors and officers of QETA listed thereto entered into a Sponsor Support Agreement (the “Sponsor Support Agreement”), pursuant to which the Sponsor has agreed to, among other things, (i) vote all QETA shares held by Sponsor in favor of the transactions contemplated by the BCA and the other transaction documents and the related transaction proposals, (ii) vote against any proposals that would or would be reasonably likely to in any material respect impede the transactions contemplated by the BCA or any related transaction proposal, (iii) not transfer any share of QETA until termination of the Sponsor Support Agreement, (iv) waive or not otherwise perfect any anti-dilution or similar protection with respect to any shares of QETA, and (v) not elect to have any share of QETA redeemed in connection with the Business Combination. Each of the Sponsor and the directors of QETA has also agreed, within certain periods of time from the closing of the Business Combination and subject to certain exceptions, not to sell, transfer, tender, grant, pledge, assign or otherwise dispose of (including by gift, tender or exchange offer, merger or operation of law), encumber, hedge or utilize a derivative to transfer the economic interest in any of the PubCo Class A ordinary shares and PubCo Rights (as applicable) acquired in connection with the Initial Merger and PubCo Class A ordinary shares received upon the exercise of any PubCo Rights (as applicable). The Sponsor Support Agreement also provides for certain put and call rights between PubCo and the Sponsor with respect to certain PubCo Class A ordinary shares held by the Sponsor following the closing of the Business Combination, and provides for the allocation and sharing of certain deferred underwriting fees of QETA between SKG and the Sponsor, in each case subject to the terms and conditions set forth therein.
Going Concern Consideration
As
of June 30, 2026, the Company had cash of $
| 8 |
Risks and Uncertainties
Various social and political circumstances in the U.S. and around the world (including rising trade tensions between the U.S. and China, and other uncertainties regarding actual and potential shifts in the U.S. and foreign, trade, economic and other policies with other countries), may contribute to increased market volatility and economic uncertainties or deterioration in the U.S. and worldwide.
As a result of these circumstances and the ongoing Russia/Ukraine, Hamas/Israel conflicts and/or other future global conflicts, the Company’s ability to consummate a Business Combination, or the operations of a target business with which the Company ultimately consummates a Business Combination, may be materially and adversely affected. In addition, the Company’s ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted by these events, including as a result of increased market volatility, or decreased market liquidity in third-party financing being unavailable on terms acceptable to the Company or at all. The impact of this action and potential future sanctions on the world economy and the specific impact on the Company’s financial position, results of operations or ability to consummate a Business Combination are not yet determinable. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Inflation Reduction Act of 2022
On
August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for,
among other things, a new U.S. federal
Any redemption or other repurchase that occurs after December 31, 2022, in connection with a Business Combination, extension vote or otherwise, may be subject to the excise tax. Whether and to what extent the Company would be subject to the excise tax in connection with a Business Combination, extension vote or otherwise would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with the Business Combination, extension or otherwise, (ii) the structure of a Business Combination, (iii) the nature and amount of any “PIPE” or other equity issuances in connection with a Business Combination (or otherwise issued not in connection with a Business Combination but issued within the same taxable year of a Business Combination) and (iv) the content of regulations and other guidance from the Treasury. In addition, because the excise tax would be payable by the Company and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been determined. The foregoing could cause a reduction in the cash available on hand to complete a Business Combination and in the Company’s ability to complete a Business Combination.
The
IR Act tax provisions had an impact on the Company’s tax provisions as a result of redemptions by public stockholders in January
2025. The Company previously recorded an excise tax liability of $
| 9 |
Note 2 — Significant Accounting Policies
Basis of Presentation
The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information, as set forth by the Financial Accounting Standards Board (“FASB”), and pursuant to the rules and regulations of the SEC. The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K, as filed with the SEC on April 23, 2026. In the opinion of management, the unaudited financial statements reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the balances and results for the periods presented. The interim results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected through December 31, 2026 or for any future periods.
Principles of consolidation
The consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of Estimates
In preparing the financial statement in conformity with U.S. GAAP, the Company’s management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
| 10 |
Cash and Cash Equivalents
The
Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.
The Company had $
Cash and Investments Held in Trust Account
As
of June 30, 2026 and December 31, 2025, the Company had $
Investments in money market funds are presented on the balance sheets at fair value at the end of each reporting period. Earnings on investments held in the Trust Account are included in interest earned on cash and investments held in the Trust Account in the accompanying statement of operations. The estimated fair value of cash and investments held in the Trust Account is determined using available market information.
Income Taxes
The Company accounts for income taxes under ASC 740, “Income Taxes (“ASC 740”)”. ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC
740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes
a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected
to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination
by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.
As of June 30, 2026 and December 31, 2025, there were
The
provision for income taxes was $
Net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period, excluding shares of common stock subject to forfeiture by the Initial Stockholders. As of June 30, 2026, the Company’s outstanding rights are contingently convertible into shares of common stock only upon the consummation of a Business Combination. Because this contingency had not been satisfied as of June 30, 2026, the rights are excluded from the calculation of diluted net income (loss) per share. The Company did not have any other dilutive securities or contracts outstanding as of June 30, 2026 that could, potentially, be exercised or converted into shares of common stock and then share in the earnings of the Company. As a result, diluted income (loss) per share is the same as basic income (loss) per share for the period presented.
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For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | |||||||
| Redeemable common stock subject to possible redemption | ||||||||
| Numerator: | ||||||||
| Net income (loss) attributable to redeemable common stock subject to possible redemption | $ | $ | ( | ) | ||||
| Denominator: Weighted average common stock subject to possible redemption | ||||||||
| Basic and diluted weighted average shares outstanding, common stock subject to possible redemption | ||||||||
| Basic and diluted net income (loss) per share, redeemable common stock | $ | $ | ) | |||||
| Non-redeemable common stock | ||||||||
| Numerator: | ||||||||
| Net income (loss) | $ | $ | ( | ) | ||||
| Less: Net income (loss) attributable to common stock subject to possible redemption | $ | $ | ( | ) | ||||
| Net income (loss) attributable to non-redeemable common stock | $ | $ | ( | ) | ||||
| Denominator: Weighted average non-redeemable common stock | ||||||||
| Basic and diluted weighted average shares outstanding, non-redeemable common stock | ||||||||
| Basic and diluted net income (loss) per share, non-redeemable common stock | $ | $ | ) | |||||
For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 | |||||||
| Redeemable common stock subject to possible redemption | ||||||||
| Numerator: | ||||||||
| Net income (loss) attributable to redeemable common stock subject to possible redemption | $ | $ | ( | ) | ||||
| Denominator: Weighted average common stock subject to possible redemption | ||||||||
| Basic and diluted weighted average shares outstanding, common stock subject to possible redemption | ||||||||
| Basic and diluted net income (loss) per share, redeemable common stock | $ | $ | ) | |||||
| Non-redeemable common stock | ||||||||
| Numerator: | ||||||||
| Net income (loss) | $ | $ | ( | ) | ||||
| Less: Net income (loss) attributable to common stock subject to possible redemption | $ | $ | ( | ) | ||||
| Net income (loss) attributable to non-redeemable common stock | $ | $ | ( | ) | ||||
| Denominator: Weighted average non-redeemable common stock | ||||||||
| Basic and diluted weighted average shares outstanding, non-redeemable common stock | ||||||||
| Basic and diluted net income (loss) per share, non-redeemable common stock | $ | $ | ) | |||||
Concentration of Credit Risk
Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Depository Insurance Coverage of $
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC 825, “Financial Instruments,” approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.
Common Stock Subject to Possible Redemption
The Company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable common stock (including common stock that feature redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. If it is probable that the equity instrument will become redeemable, we have the option to either (i) accrete changes in the redemption value over the period from the date of issuance (or from the date that it becomes probable that the instrument will become redeemable, if later) to the earliest redemption date of the instrument or (ii) recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting period. The Company has elected to recognize the changes immediately. Accordingly, as of June 30, 2026 and December 31, 2025, shares of common stock were presented at redemption value as temporary equity, outside of the stockholder’s equity section of the Company’s balance sheet. The common stock subject to possible redemption was recorded at approximately $ million and $ million as of June 30, 2026 and December 31, 2025, respectively.
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Segment Reporting
ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance.
The Company’s chief operating decision maker has been identified as the Chief Executive Officer (“CODM”), who reviews the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, management has determined that the Company only has one operating segment.
The CODM uses net income (loss), as reported on the accompanying statements of operations, as the measure of segment profit or loss to assess the Company’s performance and allocate resources.
When evaluating the Company’s performance and making key decisions regarding resource allocation, the CODM reviews key metrics, formation and operational costs and interest earned on cash and investments held in Trust Account which include the accompanying statements of operations.
The significant segment expenses and other segment items included in the measure of segment profit or loss, which are reviewed by our CODM on a regular basis, consist of interest earned on cash and investments held in Trust Account and formation and operational costs. The CODM reviews interest earned on cash and investments held in Trust Account to measure and monitor stockholder value and determine the most effective strategy of investment with the Trust Account funds while maintaining compliance with the trust agreement. Formation and operational costs are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a business combination within the business combination period. The CODM also reviews formation and operational costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.
Recent Accounting Pronouncements
In November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, requiring public entities to disclose additional information about specific expense categories in the notes to the unaudited financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.
Note 3 — Initial Public Offering
On
October 11, 2023, the Company sold Units at a price of $ per Unit (including the full exercise of the over-allotment option
of Units granted to the underwriters), generating gross proceeds of $
Note 4 — Private Placement
Simultaneously
with the closing of the IPO, The Sponsor purchased an aggregate of Private Units at a price of $ per Private Unit for an
aggregate purchase price of $
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Note 5 — Related Party Transactions
Founder Shares
On May 17, 2023, the Company issued shares of common stock to the Initial Stockholders (the “Founder Shares”) for an aggregated consideration of $, or approximately $ per share. The Initial Stockholders have agreed to forfeit up to Founder Shares to the extent that the over-allotment option is not exercised in full so that the Initial Stockholders collectively own % of the Company’s issued and outstanding shares after the IPO (assuming the Initial Stockholders do not purchase any Public Shares in the IPO and excluding the Private Units). As a result of the underwriters’ full exercise of the over-allotment option on October 11, 2023, no Founder Share were forfeited. As of June 30, 2026 and December 31, 2025, Founder Shares were issued and outstanding.
Due to Related Party
As
of June 30, 2026 and December 31, 2025, amounts due to related party were $
Promissory Note — Related Party
As
of June 30, 2026 and December 31, 2025, the Company had $
Related Party Loans
In
addition, in order to finance transaction costs in connection with an intended initial Business Combination, the Initial Stockholders
or their affiliates may, but are not obligated to, loan us funds as may be required. If the Company completes an initial Business Combination,
it will repay such loaned amounts. In the event that the initial Business Combination does not close, the Company may use a portion of
the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from the Trust Account would be used
for such repayment. Certain amount of such loans may be converted into private at $
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Administrative Support Agreement
The
Company entered into an agreement, commencing on October 5, 2023 through the earlier of the Company’s consummation of a
Business Combination and its liquidation, to pay the Sponsor a total of $
Other
On
December 26, 2024, the Company engaged Celine & Partners PLLC (“Celine”) to represent them for all U.S. corporate
and securities compliance matters. Celine is controlled by Ms. Celine Chen, who is the wife of Mr. Hui Chen, the Company’s
former CEO and director. A flat fee of $
Note 6 — Commitments and Contingencies
Registration Rights
The holders of the Founder Shares issued and outstanding on October 5, 2023, as well as the holders of the private units and any shares of the Company’s insiders, officers, directors or their affiliates may be issued in payment of working capital loans and extension loans made to the Company (and any shares of common stock issuable upon conversion of the underlying the private rights), will be entitled to registration rights pursuant to an agreement to be signed prior to or on the effective date of the IPO. The holders of a majority of these securities are entitled to make up to two demands that we register such securities. The holders of the majority of the Founder Shares can elect to exercise these registration rights at any time commencing three months prior to the date on which these shares of common stock are to be released from escrow. The holders of a majority of the private units and units issued in payment of working capital loans made to us can elect to exercise these registration rights at any time commencing on the date that the Company consummate an initial business combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of an initial business combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The
Company granted EF Hutton, the representative of the underwriters, a -day option from October 5, 2023 to purchase up to additional
Units to cover over-allotments, if any, at the IPO price less the underwriting discounts and commissions. On October 11, 2023, the underwriters
fully exercised the over-allotment option to purchase units, generating gross proceeds to the Company of $
The
underwriters were paid a cash underwriting discount of
Additionally, the Company issued the underwriters shares of common stock for the representative shares, at the closing of the IPO as part of representative compensation.
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Note 7 — Stockholders’ Deficit
Common Stock — The Company is authorized to issue shares of common stock with a par value of $ per share. Holders of common stock are entitled to one vote for each share. As a result of the underwriters’ full exercise of the over-allotment option on October 11, 2023, there are Founder Share subject to forfeiture. As of June 30, 2026 and December 31, 2025, there were shares of common stock issued and outstanding, excluding shares of common stock subject to possible redemption as of both dates.
Rights — Each holder of a right will receive one share of common stock upon consummation of a Business Combination, even if the holder of such right redeemed all shares held by it in connection with a Business Combination. No fractional shares will be issued upon conversion of the rights. No additional consideration will be required to be paid by a holder of rights in order to receive its additional shares upon consummation of a Business Combination, as the consideration related thereto has been included in the Unit purchase price paid for by investors in the IPO. If the Company enters into a definitive agreement for a Business Combination in which the Company will not be the surviving entity, the definitive agreement will provide for the holders of rights to receive the same per share consideration the holders of the common stock will receive in the transaction on an as-converted into common stock basis and each holder of a right will be required to affirmatively covert its rights in order to receive one share underlying each right (without paying additional consideration). The shares issuable upon conversion of the rights will be freely tradable (except to the extent held by affiliates of the Company).
If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of rights will not receive any of such funds with respect to their rights, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such rights, and the rights will expire worthless. Further, there are no contractual penalties for failure to deliver securities to the holders of the rights upon consummation of a Business Combination. Additionally, in no event will the Company be required to net cash settle the rights. Accordingly, holders of the rights might not receive the shares of common stock underlying the rights.
Note 8 — Fair Value Measurements
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
| Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
| Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
| Level 3: | Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
June 30, 2026 | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
| Assets | ||||||||||||||||
| Cash and Investments held in Trust Account | $ | $ | ||||||||||||||
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| December
31, 2025 | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Other Unobservable Inputs (Level 3) | |||||||||||||
| Assets | ||||||||||||||||
| Cash and Investments held in Trust Account | $ | $ | ||||||||||||||
Note 9 — Promissory Note – KM QUAD
In
November 2024, February 2025 and May 2025, the Company issued unsecured promissory notes in the aggregate principal amount of $
On
April 30, 2026, KM QUAD released and discharged the Company from all obligations under the KM QUAD Notes, including the outstanding
principal balance of $
Note 10 — Due to SKG
On
March 6, 2026, in connection with the Business Combination Agreement, SKG agreed to fund extension payments in an amount equal to $
Note 11 — Subsequent Events
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date the financial statements were issued. Based on this review, other than as disclosed below, management did not identify any events or transactions that would require adjustment to, or disclosure in, the accompanying financial statements.
On
July 10, 2026 and August 10, 2026, an aggregate of $
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Quetta Acquisition Corporation. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Yocto Investments LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Special Note Regarding Forward-Looking Statements
This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the completion of the Proposed Business Combination (as defined below), the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, including that the conditions of the Proposed Business Combination are not satisfied. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form S-1 filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Overview
We are a blank check company incorporated in Delaware on May 1, 2023. We were formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to herein as our “initial business combination.” Our efforts to identify a prospective target business are not limited to any particular industry or geographic region, although we intend to focus on target businesses in Asia that operate in the financial technology sector. We intend to utilize cash derived from the proceeds of our initial public offering (“IPO” as defined below) and the private placement of Private Units, our securities, debt or a combination of cash, securities and debt, in effecting our initial business combination.
On July 6, 2026, the chief executive officer of SKG discussed in an interview published by Sing Tao Headline SKG’s strategic partnership with KEC (Hong Kong) Limited, a subsidiary of KLN Logistics Group Limited, to jointly develop a cross-border e-commerce logistics platform, with SKG providing the technology platform and KEC contributing order volume and operational resources. SKG’s chief executive officer also discussed SKG’s plans to expand into additional overseas markets and to introduce a software-as-a-service platform intended for small and medium-sized enterprise customers. The proposed Business Combination remains subject to customary closing conditions, including regulatory review and shareholder approvals.
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an initial business combination will be successful.
Extensions of Time Period to Complete a Business Combination
On October 18, 2024, the Company entered into a non-binding LOI with QUAD, regarding a potential business combination (the “Proposed Transaction”). The LOI is non-binding and no agreement providing for any Proposed Transaction or any other transaction or the participation by either party therein will be deemed to exist unless and until definitive agreements have been executed. As a result of the execution of the LOI, the deadline by which the Company must complete its initial business combination has been extended to January 10, 2025.
On January 10, 2025, the Company held a special meeting of stockholders (the “January Special Meeting”). During the January Special Meeting, stockholders approved the proposal to amend Company’s amended and restated certificate of incorporation and Trust Agreement to extend the date by which the Company has to consummate a business combination from January 10, 2025 to October 10, 2026 (thirty six (36) months from the consummation of the IPO), on a month-by-month basis, up to a total of twenty-one (21) times, by depositing $60,000 into the Company’s trust account for each such one-month extension.
Redemption
In connection with the stockholders’ vote at the January Special Meeting of stockholders held by the Company on January 10, 2025, 5,199,297 shares were tendered for redemption. As a result, approximately $55,152,224 (approximately $10.608 per share) were removed from the Company’s trust account to pay such holders, without taking into account additional allocation of payments to cover any tax obligation of the Company, since that date. As a result, approximately $18,040,430 remained in the trust account. Following the redemptions, the Company has 3,747,748 shares of common stock issued and outstanding.
Acquisition Criteria Expansion
In connection with the stockholders’ vote at the January Special Meeting of stockholders held by the Company on January 10, 2025, stockholders approved the proposal to include any entity with its principal business operations in the geographical regions of the People’s Republic of China, the Hong Kong special administrative region, and the Macau special administrative region in the Company’s acquisition criteria in its search for a prospective target business for its business combination.
Trust Amendment
At the January Special Meeting held on January 10, 2025, stockholders approved an amendment to the Company’s amended and restated certificate of incorporation and trust agreement to extend the date by which the Company has to consummate a business combination from January 10, 2025 to October 10, 2026, on a month-by-month basis, by up to twenty-one (21) one-month extensions, by depositing $60,000 into the Company’s trust account for each such one-month extension.
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Under the amended terms, if the Company fails to timely make a payment for any given month during the twenty-one (21) month extension period, the Company has a forty-five (45) day cure period to make such payment, together with accrued but unpaid interest thereon at a rate of three percent (3%). If the Company fails to make any applicable past due payment during the cure period, the Company will cease all operations except for the purpose of winding up and will redeem the public shares and liquidate with the same effect as if the Company had failed to complete a business combination within the applicable time period.
Following the January Special Meeting, the Company deposited $60,000 into the trust account for each monthly extension from January 2025 through August 2026, thereby extending the date by which the Company could complete a business combination to September 10, 2026.
Results of Operations
We have neither engaged in any operations nor generated any operating revenues to date. Our activities for the three months ended June 30, 2026 consisted primarily of identifying and evaluating target businesses, negotiating and entering into the Business Combination Agreement with Smart Kreate Group Limited and related parties, maintaining our public company status, funding monthly extension deposits, and managing Trust Account and working capital activities. We do not expect to generate any operating revenues until after the completion of our initial business combination.
We generate non-operating income in the form of interest income on cash and investments held in the Trust Account. We expect to continue to incur expenses as a public company, including legal, financial reporting, accounting and auditing compliance costs, as well as due diligence and transaction-related expenses in connection with identifying and completing an initial business combination.
For the three months ended June 30, 2026, we had net income of $884,904, which consisted of interest earned on cash and investments held in the Trust Account of $173,286, gain on forgiveness of promissory note of $1,040,000, interest income of $432, partially offset by formation and operational costs of $191,749, related party administrative fees of $30,000, franchise tax expense of $10,200, income tax expense of $34,339 and interest and penalties on excise tax of $62,526.
For the three months ended June 30, 2025, we had a net loss of $607,950, which consisted of formation and operational costs of $723,999, related party administrative fees of $30,000, franchise tax expense of $10,200, and income tax expense of $37,507, partially offset by interest income of $1,391 and interest earned on cash and investments held in the Trust Account of $192,365.
The increase in net income for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was primarily due to a gain on forgiveness of promissory loan, interest earned on cash and investments held in the Trust Account, partially offset by lower formation and operational costs.
For the six months ended June 30, 2026, we had net income of $871,383, which consisted of interest earned on cash and investments held in the Trust Account of $342,988, gain on forgiveness of promissory note of $1,040,000, interest income of $442, partially offset by formation and operational costs of $301,442, related party administrative fees of $60,000, franchise tax expense of $20,200, interest and penalties on excise tax payable of $62,526 and income tax expense of $67,879.
For the six months ended June 30, 2025, we had a net loss of $801,621, which consisted of formation and operational costs of $1,101,101, related party administrative fees of $60,000, franchise tax expense of $20,200, and income tax expense of $94,242, partially offset by interest income of $7,560 and interest earned on cash and investments held in the Trust Account of $466,362.
The increase in net income for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was primarily due to a gain on forgiveness of promissory loan and a decrease in formation and operational costs, partially offset by lower interest earned on cash and investments held in the Trust Account and interest and penalties on excise tax payable incurred in 2026.
Liquidity and Capital Resources
On January 10, 2025, in connection with the special meeting of stockholders, holders of 5,199,297 shares exercised their right to redeem such shares for a pro rata portion of the funds held in the trust account. As a result, approximately $55.2 million was removed from the trust account to pay such redeeming stockholders, and approximately $18.0 million remained in the trust account following such redemptions. Following the January 10, 2025 special meeting, the Company was permitted to extend the date by which it must consummate a business combination from January 10, 2025 to October 10, 2026 on a month-by-month basis, by up to twenty-one one-month extensions, by depositing $60,000 into the trust account for each such one-month extension. The Company deposited $60,000 for each monthly extension through June 2026. Subsequent to June 30, 2026, the Company deposited an additional $120,000 for the July and August 2026 extension.
We intend to use substantially all of the funds held in the trust account, including any interest earned thereon not previously released to us to pay our taxes, to consummate our initial business combination. We may withdraw interest income from the trust account to pay taxes. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our initial business combination, the remaining proceeds held in the trust account, as well as any other net proceeds not expended, will be used as working capital to finance the operations of the target business, make other acquisitions and pursue our business strategy.
As of June 30, 2026, the Company had cash of $4,575, cash and investments held in the Trust Account of $19,854,590, and a working capital deficit of $2,380,850. As of December 31, 2025, the Company had cash of $1,195 and a working capital deficit of $2,630,904. The Company has incurred and expects to continue to incur significant professional costs to remain as a publicly traded company and to incur significant transaction costs in pursuit of the consummation of a Business Combination. There is no assurance that the Company’s plans to raise capital will be successful. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that these conditions raise substantial doubt about the Company’s ability to continue as a going concern, within one year after the date that the consolidated financial statements are issued. In addition, if the Company is unable to complete a Business Combination within the Combination Period, the Company’s board of directors would proceed to commence voluntary liquidation and thereby a formal dissolution of the Company. There is no assurance that the Company’s plans to consummate a Business Combination will be successful within the Combination Period. As a result, management has determined that such additional condition also raises substantial doubt about the Company’s ability to continue as a going concern until the earlier of the consummation of the Business Combination or the date the Company is required to liquidate. The consolidated financial statements do not include any adjustments that might result from the Company’s inability to continue as a going concern.
Following the January 10, 2025 special meeting, the Company was permitted to extend the date by which it must consummate a business combination from January 10, 2025 to October 10, 2026 on a month-by-month basis, by up to twenty-one one-month extensions, by depositing $60,000 into the Trust Account for each such one-month extension. As of June 30, 2026, the Company had made the required monthly extension payments through June 2026, extending the deadline to complete an initial business combination to July 10, 2026. Subsequent to June 30, 2026, on July 10, 2026 and on August 10, 2026, an additional $120,000 was deposited into the Trust Account, extending the deadline from July 10, 2026 to September 10, 2026.
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Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of June 30, 2026. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
JOBS Act
On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions, we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our IPO or until we are no longer an “emerging growth company,” whichever is earlier.
Contractual Obligations
We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than described below.
Administrative Services Agreement
We have entered into an administrative services agreement pursuant to which we will pay the Sponsor a total of $10,000 per month for office space, utilities, secretarial and administrative support. However, pursuant to the terms of such agreement, the Sponsor agreed to defer the payment of such monthly fee. Any such unpaid amount will accrue without interest and be due and payable no later than the date of the consummation of the initial Business Combination. For the three and six months ended June 30, 2026, the Company incurred $30,000 and $60,000 in administrative fees. As of June 30, 2026 and December 31, 2025, the Company had accrued administrative fees due to the Sponsor of $60,000 and $0, respectively.
Underwriting Agreement
Upon closing of a Business Combination, the underwriters will be entitled to a deferred fee of 3.5% of the gross proceeds of the IPO, or $2,415,000. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that we complete a Business Combination, subject to the terms of the underwriting agreement. Additionally, we issued the underwriters 69,000 shares of common stock, or the representative shares, at the closing of the IPO as part of representative compensation.
Promissory Note in Connection with Extension Payments
The KM QUAD Merger Agreement provided that, in the event that the closing of the KM QUAD Business Combination does not occur by February 10, 2025, the Company shall have the right to extend the time to complete the KM QUAD Business Combination up to twenty-one (21) times for one month each time until October 10, 2026. QUAD would be responsible for the extension fees covering nine extensions over nine months, in total amount of $540,000.
On or before February 14, 2025, KM QUAD wired the first installment of the prepaid extension fees, in the amount of $250,000, to the Company’s designated bank account in exchange for a promissory note issued by the Company. KM QUAD wired the second installment of the prepaid extension fees, in the amount of $290,000, to the Company’s designated bank account on or before April 20, 2025 in exchange for a promissory note issued by the Company. If the closing of the KM QUAD Business Combination does not occur prior to October 10, 2025 due to a delay in obtaining CSRC approvals, KM QUAD would be responsible for any extension fees and other related fees incurred by the Company beyond October 10, 2025 not to exceed $100,000 per month. If the closing of the KM QUAD Business Combination or termination of the Agreement occurs prior to October 10, 2025, the Company would return the remaining balance of the prepaid extension fees, if any, to KM QUAD on a pro rata basis. Alternatively, at the closing of the KM QUAD Business Combination, the Company would have the right to convert any prepaid extension fees that were paid and not returned into Purchaser Class A Ordinary Shares at $10.00 per share.
As of December 31, 2025, the KM QUAD Business Combination had not been consummated. Subsequent to December 31, 2025, on January 15, 2026, the parties entered into a Termination Agreement pursuant to which the KM QUAD Merger Agreement was terminated by mutual consent.
On April 30, 2026, KM QUAD released and discharged the Company from all obligations under the KM QUAD Notes, including the outstanding principal balance of $500,000 and extension fee of $540,000.
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Critical Accounting Policies and Estimates
The preparation of unaudited financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have not identified any critical accounting policies and estimates.
Recent accounting pronouncements
In November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, requiring public entities to disclose additional information about specific expense categories in the notes to the unaudited financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not required for smaller reporting companies.
Item 4. Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management including our Chief Executive Officer, Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of June 30, 2026, our Chief Executive Officer and Chief Financial Officer carried out an evaluation with the participation of management of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were ineffective at a reasonable assurance level as of June 30, 2026 due to the material weakness in our internal controls as a result of inadequate segregation of duties within accounting processes due to limited personnel and insufficient written policies and procedures for accounting, IT, and financial reporting and record keeping.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Securities Exchange Act of 1934 that occurred during the quarter ended June 30, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Internal Controls
A control system, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. In addition, the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 1A. RISK FACTORS
As a smaller reporting company, we are not required to make disclosures under this Item.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
On October 11, 2023, Quetta Acquisition Corporation (the “Company”) consummated its initial public offering (the “IPO”) of 6,900,000 units (the “Units”), which includes full exercise of the underwriter’s over-allotment option. Each Unit consists of one common stock of the Company, par value $0.0001 per share (the “Common Stock”) and one-tenth (1/10) of one right (“Right”) to receive one share of common stock upon the consummation of an initial business combination. The Units were sold at a price of $10.00 per Unit, generating gross proceeds to the Company of $69,000,000. Simultaneously with the closing of the IPO, the Company consummated a private placement (the “Private Placement”) in which Yocto Investments LLC (the “Sponsor”), purchased 253,045 private units (the “Private Placement Units”) at a price of $10.00 per Private Unit, generating total proceeds of $2,530,450. The Private Units were issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, as the transactions did not involve a public offering. The Private Units are identical to the Public Units sold in the Initial Public Offering.
A total of $69,690,000 of the proceeds from the IPO and the sale of the Private Placement Units were placed in a trust account established for the benefit of the Company’s public shareholders. We paid a total of $1,380,000 underwriting discounts and commissions and $1,097,729 for other offering costs and expenses (excluding $690,000 of representative shares at fair value) related to the Initial Public Offering. In addition, the underwriters agreed to defer $2,415,000 in underwriting discounts and commissions. The underwriters reimbursed $690,000 to us for the IPO related expenses.
For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Quarterly Report.
On January 10, 2025, the Company held a special meeting of stockholders (the “January Special Meeting”). During the January Special Meeting, stockholders approved (i) an amendment to the Company’s amended and restated certificate of incorporation, (ii) an amendment to the Company’s Investment Management Trust Agreement dated October 5, 2023 and (iii) a proposal to include any entity with its principal business operations in the geographical regions of China, Hong Kong, and Macau in the Company’s acquisition criteria in its search for a prospective target business for its business combination. In connection with the stockholders’ vote at the January Special Meeting, 5,199,297 shares were tendered for redemption. As a result, approximately $55,152,224 (approximately $10.608 per share) were removed from the Company’s trust account to pay such holders, without taking into account additional allocation of payments to cover any tax obligation of the Company, since that date. As a result, approximately $18,040,430 will remain in the trust account. Following the redemptions, the Company has 3,747,748 shares of common stock issued and outstanding.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
As previously disclosed, the Company received notices from The Nasdaq Stock Market LLC (“Nasdaq”) regarding certain continued listing deficiencies, including the Company’s failure to regain compliance with the minimum Market Value of Listed Securities requirement for continued listing on the Nasdaq Global Market and its failure to timely file its Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The Company filed its Annual Report on Form 10-K on April 23, 2026.
During the three months ended June 30, 2026, no director or officer of the Company
On May 12, 2026, the Company received notice from Nasdaq that Nasdaq had approved the Company’s application to transfer the listing of its ordinary shares, units and rights from the Nasdaq Global Market to the Nasdaq Capital Market, effective at the opening of business on May 14, 2026. The Company’s securities will continue to trade under the symbols “QETA,” “QETAU” and “QETAR,” respectively. Nasdaq also notified the Company that it had regained compliance with the minimum market value of listed securities requirement under Nasdaq Listing Rule 5450(b)(2), that it was in compliance with all applicable continued listing standards following approval of the phasedown application, and that the previously scheduled hearing before the Nasdaq Hearings Panel had been cancelled.
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ITEM 6. EXHIBITS
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
| * | Filed herewith. |
| ** | Furnished. |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| QUETTA ACQUISITION CORPORATION | ||
| Date: August 14, 2026 | By: | /s/ Zihan Chen |
| Name: | Zihan Chen | |
| Title: | Chairperson, Chief Executive Officer | |
| (Principal Executive Officer) | ||
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