10-Q: Haymaker 4 Q3 2025: Suncrete Merger & Liquidity Concerns

Haymaker Acquisition Corp. 4 reports a net income decline in Q3 2025, announces a definitive merger agreement with Suncrete, Inc., and faces significant liquidity challenges.

Summary

• Net income for the three months ended September 30, 2025, was $1,590,985, a decrease from $2,877,078 for the same period in 2024.
• Net income for the nine months ended September 30, 2025, was $6,225,344, down from $8,686,281 for the nine months ended September 30, 2024.
• General and administrative expenses significantly increased to $1,006,561 for Q3 2025 from $277,491 for Q3 2024, and to $1,670,353 for the nine months ended September 30, 2025, from $711,587 for the same period in 2024.
• Interest earned on cash and marketable securities held in the Trust Account decreased to $2,597,546 for Q3 2025 from $3,154,569 for Q3 2024, and to $7,895,697 for the nine months ended September 30, 2025, from $9,397,868 for the same period in 2024.
• A definitive Business Combination Agreement with Suncrete, Inc. was entered into on October 9, 2025.
• Shareholders approved an extension of the Business Combination Period to July 28, 2026, at the 2025 Annual General Meeting on July 24, 2025.
• In connection with the extension, 372,101 Class A Ordinary Shares were redeemed for approximately $4,136,911, at a redemption price of approximately $11.12 per share.
• The Sponsor issued an Extension Promissory Note for up to $4,500,000 on July 28, 2025, with $1,125,000 drawn as of September 30, 2025, to fund monthly contributions to the Trust Account.
• The company reported a working capital deficit of $3,305,248 and cash of $6,704 outside the Trust Account as of September 30, 2025, raising substantial doubt about its ability to continue as a going concern.

Sentiment

Score: 3

Explanation: While the definitive merger agreement with Suncrete is a positive step for a SPAC nearing its deadline, the significant decline in net income, sharp increase in expenses, substantial redemptions, and explicit 'going concern' warning indicate severe financial distress and operational challenges. The government shutdown risk further complicates the path to closing the merger, leading to an overall negative sentiment.

Positives

• A definitive Business Combination Agreement was signed with Suncrete, Inc. on October 9, 2025, providing a clear path towards completing a merger.
• Shareholders approved an extension of the Business Combination Period to July 28, 2026, granting additional time to consummate the merger.
• The Sponsor committed up to $4,500,000 via an Extension Promissory Note to fund monthly contributions to the Trust Account, supporting the extension and maintaining the Trust Account balance.
• The Trust Account balance increased to $254,644,430 as of September 30, 2025, from $249,760,654 at December 31, 2024.

Negatives

• Net income significantly decreased for both the three and nine months ended September 30, 2025, compared to the prior year periods.
• General and administrative expenses more than tripled for both the three and nine months ended September 30, 2025, compared to the prior year periods, indicating increased operational burn.
• Interest earned on cash and marketable securities in the Trust Account decreased, likely due to redemptions and potentially lower interest rates or investment changes.
• Significant redemptions of 372,101 Class A Ordinary Shares, totaling approximately $4.14 million, occurred in connection with the extension vote, reducing the capital available for the Business Combination.
• The company's cash balance outside the Trust Account is very low at $6,704 as of September 30, 2025.
• A working capital deficit of $3,305,248 as of September 30, 2025, indicates severe liquidity issues.
• Management explicitly states "substantial doubt about the Company's ability to continue as a going concern" due to its liquidity condition and the deadline for a Business Combination.

Risks

• The ability to complete an initial Business Combination may be adversely affected by various factors beyond the company's control, including changes in laws or regulations, downturns in financial markets, economic conditions, inflation, interest rate fluctuations, 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).
• Failure to consummate a Business Combination by July 28, 2026 (or any further extended date) will result in mandatory liquidation and dissolution of the company.
• Further extensions of the Combination Period would require shareholder approval and could lead to additional redemptions, decreasing the amount held in the Trust Account and potentially affecting the company's listing on NYSE.
• Failure to meet the NYSE Three Year Requirement for completing a Business Combination could lead to a suspension of trading and delisting from NYSE.
• SEC review delays caused by any government shutdown may delay or interfere with the ability to complete the initial Business Combination; a government shutdown commenced on October 1, 2025, and continued through the filing date.
• The company's liquidity condition raises substantial doubt about its ability to continue as a going concern for a period of time within one year after the date the financial statements were issued.

Future Outlook

The company intends to complete the initial Business Combination with Suncrete, Inc. before the end of the Combination Period, currently set for July 28, 2026. Management plans to address the current liquidity uncertainty through this Business Combination. The company expects to incur increased expenses as a public company and for due diligence related to the merger. There is a possibility of seeking further extensions to the Combination Period, which would require shareholder approval and could lead to additional redemptions. The Sponsor may also explore transactions to sell its interest, potentially leading to a change in the Management Team.

Management Comments

• "Management plans to address this uncertainty through a Business Combination."
• "We intend to complete the initial Business Combination before the end of the Combination Period."
• "We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud."
• "Our Certifying Officer concluded that our disclosure controls and procedures were effective as of September 30, 2025."

Industry Context

Haymaker Acquisition Corp. 4 operates as a Special Purpose Acquisition Company (SPAC), a sector currently facing significant challenges in completing de-SPAC transactions, as evidenced by the need for an extension and substantial shareholder redemptions. The announced target, Suncrete, Inc., is in the consumer and consumer-related products and services industries, specifically concrete, indicating a move into a more traditional industrial/construction sector. The explicit "going concern" warning and liquidity issues are common for SPACs nearing their dissolution deadline without a completed merger. The risk of SEC review delays due to a government shutdown highlights broader regulatory and economic uncertainties impacting M&A timelines across industries.

Comparison to Industry Standards

• The redemption rate of 372,101 shares in connection with the extension vote is notable, as high redemptions are a common challenge for SPACs, reducing the capital available for the target business. This is comparable to other SPACs that have faced significant redemptions when seeking extensions or announcing deals, such as those seen with Digital World Acquisition Corp. (DWAC) or Gores Holdings IX (GHIX) in their extension votes.
• The redemption price of approximately $11.12 per share is above the initial $10.00 IPO price, reflecting interest earned in the Trust Account, which is a standard feature for SPACs and generally aligns with market expectations for SPACs that have held funds for a period.
• The explicit "substantial doubt about the Company's ability to continue as a going concern" is a serious indicator of financial distress, often observed in SPACs that struggle to identify or close a business combination within their mandated timeframe, or incur high operational costs relative to their non-operating income. This situation is more severe than typical SPACs that maintain sufficient working capital outside the trust.
• The extension of the Business Combination Period to July 28, 2026, is a common strategy for SPACs to gain more time, often accompanied by sponsor contributions to the Trust Account, similar to extensions pursued by other SPACs like Churchill Capital Corp IV (CCIV) or Pershing Square Tontine Holdings (PSTH) in their respective timelines.

Corporate Governance

Legal Proceedings

• To the knowledge of management, there is no material litigation currently pending or contemplated against the company, its officers, or directors.

Related Party Transactions

• The Sponsor acquired 5,750,000 Class B Ordinary Shares (Founder Shares) for an aggregate purchase price of $25,000.
• The Sponsor loaned the company up to $1,500,000 via the WCL Promissory Note for working capital expenses, with $755,000 drawn as of September 30, 2025. These loans are convertible into WCL Units.
• The Sponsor loaned the company up to $4,500,000 via the Extension Promissory Note to fund monthly contributions to the Trust Account, with $1,125,000 drawn as of September 30, 2025.
• The company pays an affiliate of its Vice President $20,000 per month for office space, utilities, and administrative services under an Administrative Services Agreement.
• The company has an Advisory Services Agreement with an affiliate of its Chief Financial Officer for $20,000 per month, contingent upon the successful completion of the initial Business Combination, with $180,000 accrued as of September 30, 2025.

Stakeholder Impact

• **Shareholders**: Public shareholders who redeemed shares received approximately $11.12 per share. Remaining shareholders face uncertainty due to the "going concern" warning and the need to successfully complete the Suncrete Business Combination. There is potential for dilution from WCL Units and a PIPE offering.
• **Sponsor**: Continues to provide financial support through promissory notes, increasing its exposure but also its potential upside if the Business Combination closes. The Sponsor stands to benefit significantly from the conversion of Founder Shares and WCL Units upon a successful merger.
• **Employees/Management**: The management team is actively working to complete the Business Combination. Contingent fees for the CFO's affiliate depend on the successful completion of the merger.
• **Suncrete, Inc.**: The target company is awaiting the completion of the Business Combination, which is subject to various conditions, regulatory approvals, and the SPAC's ability to overcome its financial challenges.
• **Underwriters**: Deferred underwriting fees of $8,650,000 are contingent on the completion of a Business Combination, creating an incentive for them to see the merger through.

Next Steps

• Complete the Business Combination with Suncrete, Inc. by the extended deadline of July 28, 2026.
• File a post-effective amendment to the IPO Registration Statement or a new registration statement covering the Class A Ordinary Shares issuable upon exercise of the Warrants.
• Maintain a current prospectus relating to the Class A Ordinary Shares issuable upon exercise of the Warrants.
• Address the "going concern" issues through the successful consummation of the Business Combination.
• Potentially seek further extensions of the Combination Period, which would require shareholder approval.

Key Dates

Recommendation

The definitive Business Combination Agreement with Suncrete provides a clear path forward for the SPAC, which is a positive development given its approaching deadline. However, the significant financial deterioration, including decreased net income, sharply increased expenses, substantial redemptions, and an explicit "going concern" warning, introduce considerable risk. The ongoing government shutdown also poses a potential delay to SEC review. Investors currently holding shares should hold to see if the Suncrete merger can be successfully consummated, as the completion of a deal could provide a catalyst. However, new investment is not recommended at this stage due to the high uncertainty and financial distress, making the stock highly speculative.

Keywords

SPAC, Haymaker Acquisition Corp. 4, HYAC, Suncrete, Business Combination, Merger, 10-Q, Quarterly Report, Financials, Liquidity, Going Concern, Redemption, Trust Account, Extension, Promissory Note, Corporate Governance, Risk Factors, SEC Filing