10-Q: Haymaker 4 Extends SPAC Deadline to July 2026

Haymaker Acquisition Corp. 4 extended its business combination deadline to July 28, 2026, following a shareholder vote and a significant redemption of Class A Ordinary Shares.

Summary

• Haymaker Acquisition Corp. 4 (HYAC) is a blank check company focused on consumer and consumer-related industries, with no current operations or revenue.
• The company extended its deadline to complete a business combination to July 28, 2026, from July 28, 2025, following shareholder approval at the 2025 Annual General Meeting.
• This extension resulted in the redemption of 372,101 Class A Ordinary Shares at approximately $11.12 per share, totaling $4,136,911.
• The Sponsor agreed to make monthly contributions to the Trust Account, up to $4,500,000, via a non-interest bearing promissory note, with the first $375,000 contribution made on July 28, 2025.
• As of June 30, 2025, the company reported a net income of $2,358,653 for the three months and $4,634,359 for the six months, primarily from interest earned on the Trust Account.
• Cash held outside the Trust Account was $9,971 as of June 30, 2025, with a working capital deficit of $1,173,687.
• The company faces substantial doubt about its ability to continue as a going concern without completing a business combination.

Sentiment

Score: 4

Explanation: While the extension provides more time, the declining cash outside the trust, increased expenses, and reduced net income, coupled with the 'going concern' warning, indicate operational challenges and continued uncertainty for this pre-deal SPAC. The redemptions, though not massive, also reflect some shareholder exit. The sponsor's continued funding is a positive, but it's a loan, not equity.

Positives

• Successful approval of the Extension Amendment, providing more time to find a business combination target until July 28, 2026.
• Sponsor's commitment to provide additional funding to the Trust Account through monthly contributions via an Extension Promissory Note, up to $4,500,000.
• Trust Account balance increased to $255,058,805 as of June 30, 2025, from $249,760,654 as of December 31, 2024, due to interest income.

Negatives

• Significant redemptions of 372,101 Class A Ordinary Shares, totaling $4,136,911, reduced the number of outstanding shares and the Trust Account balance post-redemption.
• Net income for the three months ended June 30, 2025, decreased to $2,358,653 from $2,942,995 in the prior year period.
• Net income for the six months ended June 30, 2025, decreased to $4,634,359 from $5,809,203 in the prior year period.
• Cash held outside the Trust Account significantly decreased to $9,971 as of June 30, 2025, from $101,126 as of December 31, 2024.
• Working capital deficit of $1,173,687 as of June 30, 2025, raises substantial doubt about the company's ability to continue as a going concern.
• General and administrative expenses increased to $304,822 for Q2 2025 from $196,552 for Q2 2024, and to $663,792 for 6M 2025 from $434,096 for 6M 2024.

Risks

• Inability to complete an initial Business Combination by July 28, 2026, leading to mandatory liquidation and dissolution.
• Adverse effects on the ability to complete a Business Combination due to changes in laws or regulations, downturns in financial markets or economic conditions, inflation, fluctuations in interest rates, increases in tariffs, supply chain disruptions, declines in consumer confidence and spending, public health considerations, and geopolitical instability (e.g., military conflicts in Ukraine and the Middle East).
• Potential suspension of trading and delisting from NYSE if the NYSE Three Year Requirement for Business Combinations is not met.
• Claims by third parties for services or products, or by prospective target businesses, could reduce funds in the Trust Account below the lesser of $10.10 per Public Share or the actual amount per Public Share, for which the Sponsor may be liable.
• Reliance on the Sponsor or its affiliates for working capital loans, which are not obligated.

Future Outlook

The company intends to complete an initial Business Combination by the extended deadline of July 28, 2026. Management is actively searching for a target in the consumer and consumer-related products and services industries. There is no assurance that a Business Combination will be successfully consummated, and the company may seek further extensions, which would require shareholder approval and could lead to further redemptions.

Management Comments

• Our management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the Private Placement, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination.
• We intend to complete the initial Business Combination before the end of the Combination Period; however, there can be no assurance that we will be able to do so.
• Management plans to address this uncertainty [going concern] through a Business Combination.
• We are focusing our search for an initial Business Combination with a business in the consumer and consumer-related products and services industries.

Industry Context

Haymaker Acquisition Corp. 4 operates as a Special Purpose Acquisition Company (SPAC) in a challenging market environment for blank check companies, characterized by increased redemptions and regulatory scrutiny. The extension of its business combination deadline and the Sponsor's commitment to additional funding reflect common strategies employed by SPACs to navigate these conditions and secure more time for target identification. The focus on consumer and consumer-related industries aligns with a broad sector, but the company's success hinges entirely on its ability to identify and successfully merge with a suitable private company within the extended timeframe, a task that has become increasingly difficult for many SPACs.

Comparison to Industry Standards

• The redemption rate of approximately 1.6% (372,101 shares out of 23,000,000 initial public shares) for the extension vote is notably lower than the average redemption rates observed in the broader SPAC market in 2023-2024, which often ranged from 50% to over 90% for extension votes, as seen with SPACs like Digital World Acquisition Corp. or Gores Guggenheim, Inc. This suggests relatively less shareholder dissent or a higher proportion of long-term holders.
• The Sponsor's commitment to contribute up to $4,500,000 to the Trust Account via a non-interest bearing promissory note for the extension is a standard practice in the SPAC industry to incentivize non-redeeming shareholders and maintain the Trust Account value, similar to actions taken by sponsors of SPACs such as Star Peak Energy Transition Corp. or Queen's Gambit Growth Capital.
• The company's current cash balance outside the Trust Account ($9,971) and working capital deficit ($1,173,687) are typical for a pre-deal SPAC, which generally operates with minimal cash outside the trust and relies on sponsor loans or interest income to cover administrative expenses, aligning with the financial profiles of many SPACs prior to a definitive agreement.
• The requirement to complete a business combination with an aggregate fair market value of at least 80% of the net assets in the Trust Account is a standard SPAC listing rule (e.g., NYSE and Nasdaq), ensuring that the target business is substantial relative to the SPAC's capital.

Corporate Governance

Related Party Transactions

• Administrative Services Agreement: Company pays an affiliate of its Vice President $20,000 per month for office space, utilities, and administrative services. $60,000 incurred for Q2 2025 and $120,000 for 6M 2025.
• Advisory Services Agreement: Company agreed to pay an affiliate of its Chief Financial Officer $20,000 per month for services rendered prior to the consummation of the initial Business Combination, payable only upon successful completion of the Business Combination. Contingent fee amounted to $120,000 as of June 30, 2025.
• WCL Promissory Note: Company issued a promissory note to the Sponsor for up to $1,500,000 for working capital expenses, with $400,000 drawn as of June 30, 2025.
• Extension Promissory Note: Company issued a non-interest bearing, unsecured promissory note for up to $4,500,000 to the Sponsor, in exchange for monthly contributions to the Trust Account.

Stakeholder Impact

• Shareholders: Public shareholders who redeemed their shares received approximately $11.12 per share, a return above the initial $10.00 IPO price. Remaining shareholders face continued uncertainty but have an extended period for a potential business combination.
• Sponsor: Continues to fund the company's operations and Trust Account, increasing its financial commitment and risk, but also maintaining its potential upside from Founder Shares and Warrants if a deal closes.
• Underwriters: Deferred underwriting fees of $8,650,000 remain payable only upon the completion of a Business Combination, creating an incentive for a deal.

Next Steps

• Identify and consummate an initial Business Combination by July 28, 2026.
• Sponsor to continue making monthly contributions to the Trust Account as per the Extension Promissory Note.
• Potentially seek further extensions of the Combination Period, which would require shareholder approval.
• Management will continue to manage and forecast cash to ensure enough capital is available for a Business Combination.

Key Dates

Recommendation

The company successfully extended its business combination deadline, which is crucial for a SPAC. However, the significant cash burn outside the Trust Account, the 'going concern' warning, and the decline in net income compared to the prior year indicate ongoing operational challenges and a lack of a definitive deal. While the Sponsor's continued financial support is positive, the investment remains highly speculative, contingent on a successful and value-accretive business combination. For a seasoned investor, holding is appropriate to see if a viable target is identified, but new investment is not warranted given the inherent risks and current financial state.

Keywords

SPAC, Haymaker Acquisition Corp. 4, HYAC, Business Combination, Trust Account, SEC Filing, 10-Q, Quarterly Report, Consumer Industry, Extension, Redemption, Promissory Note, Financial Results