Annual Report for Fiscal Year Ending March 31, 2026 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and Results of Operations.

References to the "Company," "us," "our" or "we" refer to Quantumsphere Acquisition Corporation The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and related notes included herein. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Overview

We are a blank check company incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target.

We intend to effectuate our initial business combination using cash from the proceeds of the Initial Public Offering ("IPO" as defined below), and the private placement of the private placement units, the proceeds of the sale of our securities in connection with our initial business combination, our shares, debt or a combination of cash, stock and debt. 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.

Recent Developments

Initial Public Offering

On August 7, 2025, the Company consummated its initial public offering of 8,280,000 units, including the full exercise of the underwriter's over-allotment option for 1,080,000 additional units, at a price of $10.00 per unit, generating gross proceeds of $82,800,000. Each unit consists of one ordinary share and one right to receive one-seventh of one ordinary share upon the consummation of the Company's initial business combination. Simultaneously with the closing of the IPO, the Company completed a private placement with its sponsor, Whiteowl Holdings LLC, of 228,650 private placement units at a price of $10.00 per private placement unit, generating additional gross proceeds of $2,286,500. Following the closing of the IPO and the private placement, a total of $82,800,000 was deposited into the trust account maintained by Continental Stock Transfer & Trust Company, acting as trustee, for the benefit of the Company's public shareholders.

Finder's Agreement

On August 8, 2025, the Company entered into a finder's agreement with Aspira Capital Consulting LTD, pursuant to which the Company agreed to pay Aspira a one-time, non-refundable retainer fee of $300,000, a success fee of $3,500,000 payable upon the closing of a qualifying transaction, and reimbursement for reasonable out-of-pocket expenses up to $150,000 without prior written approval.

On February 21, 2026, the Company, the Finder and SACH Pte. Ltd. (the "Target") entered into Amendment No. 1 to the Finder's Agreement, pursuant to which the parties agreed that the $3,500,000 success fee will be satisfied in full through the issuance by the Target of 1,200,000 ordinary shares to the Finder at the closing of the business combination, with no cash payment owed by the Company. The Target acknowledged the Finder as the procuring cause of the transaction and assumed the obligation to issue such shares. As of March 31, 2026, the retainer fee of $300,000 had been paid in full, and there was no outstanding balance.

Separate Trading of Units, Ordinary Shares and Rights

On September 26, 2025, the Company announced that holders of its units sold in the IPO could elect to separately trade the ordinary shares and rights included in the units, commencing on or about September 30, 2025. The units, ordinary shares and rights trade on the Nasdaq Stock Market LLC under the symbols "QUMSU," "QUMS" and "QUMSR," respectively.

Merger Agreement

On October 3, 2025, Quantumsphere Acquisition Corporation, a Cayman Islands exempted company ("Quantumsphere" or the "Parent"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with Omnivate Global Ltd., a Cayman Islands exempted company (the "HoldCo"), SACH Pte. Ltd., an exempt private company limited by shares incorporated and existing under the laws of Singapore (the "SACH"), QUMS Pubco Ltd., a Cayman Islands exempted company and wholly-owned subsidiary of Quantumsphere (the "PubCo"), and SACH Merge Sub Ltd., a Cayman Islands exempted company and wholly-owned subsidiary of the PubCo (the "Merger Sub"). SACH Pte. Ltd. is engaged in the business of developing and commercialising products and services across the gaming, technology, e-commerce, retail, and live events industries. Capitalized terms used herein but not defined herein shall have the meanings ascribed to them in the Merger Agreement.

Upon the closing of the transactions contemplated by the Merger Agreement, Quantumsphere will merge with and into PubCo, resulting in all Quantumsphere shareholders becoming shareholders of the PubCo. Concurrently therewith, Merger Sub will merge with and into HoldCo, with HoldCo surviving the merger and resulting in PubCo acquiring 100% of the issued and outstanding equity securities of the HoldCo (the "Acquisition Merger"). Upon the closing of the transactions contemplated by the Merger Agreement, each ordinary share of Quantumsphere issued and outstanding immediately prior to the SPAC Merger Effective Time, other than excluded shares and dissenting shares, will automatically convert into one ordinary share of the PubCo. Each outstanding Quantumsphere unit will automatically separate into one ordinary share and one right, and each outstanding Quantumsphere right will automatically convert into one PubCo right. At the closing, all PubCo rights will be cancelled, and the holders thereof will receive one PubCo ordinary share for each PubCo right, with no fractional shares issued.

The Merger Agreement also provides for certain operation and maintenance funding arrangements for the Sponsor, as described under "Sponsor Loans" below.

The aggregate consideration to be paid to the SACH shareholders in the Acquisition Merger is $300,000,000, payable in newly issued PubCo Ordinary Shares equal to $300,000,000 divided by $10.00 per share.

The board of directors of Quantumsphere has unanimously (i) approved and declared advisable the Merger Agreement, the Business Combination and the other transactions contemplated thereby and (ii) resolved to recommend approval of the Merger Agreement and related matters by the shareholders of Quantumsphere.

Sponsor Loans

Under the Merger Agreement, SACH and HoldCo agreed to advance certain operation and maintenance funding to the Sponsor in three loans consisting of Sponsor Loan I, Sponsor Loan II and Sponsor Loan III, totaling $1.0 million. Sponsor Loan I and Sponsor Loan II were fully funded in the amount of $250,000 each on October 9, 2025 and October 17, 2025, respectively, and Sponsor Loan III was fully funded in the amount of $500,000 on January 2, 2026. As of March 31, 2026, the Sponsor had not advanced any portion of the Sponsor Loans to the Company. The Company's operations have been funded to date by the net proceeds of its initial public offering and the private placement and by the related-party Promissory Notes, which were repaid in full upon the closing of the IPO; no working capital loans had been drawn as of March 31, 2026.

Shareholder Support Agreement

Concurrently with the execution of the Merger Agreement, certain shareholders of the entered into a support agreement with the Parent, pursuant to which each such shareholder of the Company agreed to vote in favor of the business combination, subject to the terms of such shareholder support agreement.

Sponsor Support Agreement

Whiteowl Holdings LLC, the sponsor of the Company (the "Sponsor"), entered into a Sponsor Support Agreement pursuant to which it agreed to vote its shares of the Company in favor of the Merger Agreement and take certain other actions in support of the transaction.

Lock-up Agreement

In connection with the transactions contemplated by the Merger Agreement, Quantumsphere, the Sponsor, PubCo, Whiteowl Holdings LLC, certain Company Shareholders, HoldCo and SACH entered into a Lock-Up Agreement, dated October 3, 2025. Pursuant to the Lock-Up Agreement, the applicable holders agreed not to transfer their Lock-Up Shares during the applicable lock-up period, subject to certain customary exceptions.

With respect to the Sponsor, the Whiteowl Holdings LLC and their permitted transferees, the lock-up period begins on the closing date and ends on the earliest of (i) the date that is 365 days after the closing date, (ii) the date on which the closing trading price of PubCo ordinary shares equals or exceeds $15.00 per share, as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like, for any 20 trading days within any 30-trading day period at least 150 days after the closing date, or (iii) the consummation of a bona fide liquidation, merger, stock exchange, reorganization, tender offer, change of control or other similar transaction that results in all of PubCo's shareholders having the right to exchange their PubCo ordinary shares for cash, securities or other property.

With respect to the Company Shareholders, HoldCo shareholders and their permitted transferees, the lock-up period begins on the closing date and ends on the earliest of (i) the date that is 365 days after the closing date, (ii) the date on which the closing trading price of PubCo ordinary shares equals or exceeds $12.00 per share, as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like, for any 20 trading days within any 30-trading day period at least 150 days after the closing date, or (iii) the consummation of a bona fide liquidation, merger, stock exchange, reorganization, tender offer, change of control or other similar transaction that results in all of PubCo's shareholders having the right to exchange their PubCo ordinary shares for cash, securities or other property.

Results of Operations

We have neither engaged in any operations nor generated any revenues to date. Our only activities from July 23, 2024 (inception) through March 31, 2026, were organizational activities and those necessary to consummate the IPO, and subsequent to the IPO, identifying a target company for an initial business combination. We do not expect to generate any operating revenues until after the completion of our initial business combination.

We expect to generate non-operating income in the form of interest income on marketable securities held after the IPO. We expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with searching for, and completing, a Business Combination.

For the year ended March 31, 2026, we had net income of $978,206 which consisted of interest income of $2,054,392 offset by general and administrative expenses of $1,076,186.

For the period from July 23,2024 (inception) through March 31, 2025, we had net loss of $16,018 which consisted of formation and operating costs of $17,639 offset by interest income of $1,621.

Liquidity and Capital Resources

On August 7, 2025, we consummated our IPO of 7,200,000 units (the "Units"), at $10.00 per Unit, generating gross proceeds of $72,000,000. In connection with the closing of the IPO, the underwriter fully exercised its over-allotment option to purchase 1,080,000 additional Units for an aggregate of 8,280,000 Units sold. The Units were sold at an offering price of $10.00 per Unit, generating a total gross proceeds of $82,800,000. Simultaneously with the closing of our IPO, we consummated the sale of 228,650 Private Placement Units at a price of $10.00 per Private Placement Unit in a private placement to the Sponsor, generating total gross proceeds of $2,286,500.

Upon the closing of the IPO and the private placement on August 7, 2025, a total of $82,800,000 from the net proceeds of the IPO and the sale of the Private Placement Units was placed in a trust account (the "Trust Account") maintained by Continental Stock Transfer & Trust Company as a trustee and will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended (the "Investment Company Act"), and that invest only in direct U.S. government treasury obligations.

We intend to use substantially all of the net proceeds of the IPO and the private placement, including the funds held in the Trust Account, in connection with our initial business combination and to pay our expenses relating thereto, including deferred underwriting discounts and commissions payable to the underwriters in the IPO in an amount equal to 4.0% of the total gross proceeds raised in the IPO upon consummation of our initial business combination. To the extent that our capital stock is used in whole or in part as consideration to effect 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. Such working capital funds could be used in a variety of ways including continuing or expanding the target business' operations, for strategic acquisitions and for marketing, research and development of existing or new products. Such funds could also be used to repay any operating expenses or finders' fees which we had incurred prior to the completion of our initial business combination if the funds available to us outside of the Trust Account were insufficient to cover such expenses.

As of March 31, 2026, we had cash of $187,907 and a working capital surplus of $43,556.

The Company has incurred and expects to continue to incur significant costs in pursuit of the consummation of an initial Business Combination. In addition, the Company currently has until February 7, 2027 (unless the Company extends such period by amending its Amended and Restated Memorandum and Articles of Association) to consummate the initial Business Combination. If the Company does not complete a Business Combination within the prescribed timeline, the Company will trigger an automatic winding up, dissolution and liquidation pursuant to the terms of the Amended and Restated Memorandum and Articles of Association. 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," the Company has determined that it has incurred and expects to continue to incur significant costs in pursuit of its acquisition plans. There is no assurance that the Company's plans to raise capital or to consummate a Business Combination will be successful within the Combination Period. The Company lacks the financial resources it needs to sustain operations for a reasonable period of time, which is considered to be one year from the date of the issuance of the financial statements. Therefore, management has determined that these conditions raise 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 financial statement does not include any adjustments that might result from the outcome of this uncertainty.

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 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.

Contractual Obligations

Promissory Note - Related Party

On March 9, 2025 and July 22, 2025, the Sponsor agreed to loan the Company up to an aggregate amount of $200,000 and $500,000, respectively, to be used, in part, for transaction costs incurred in connection with the IPO (the "Promissory Notes"). Prior to the closing of the IPO on August 7, 2025, the Company has an outstanding loan balance of $210,000 under the Promissory Notes. The Promissory Notes are unsecured, interest-free and due on the date on which the Company closes the IPO. The loan balance was repaid upon the closing of the IPO out of the offering proceeds not held in the Trust Account on August 7, 2025. The Promissory Notes have been retired and are no longer available for further drawdowns.

Administrative Services Agreement

The Company entered into an Administrative Services Agreement with the Sponsor on August 5, 2025, commencing on the effective date of the registration statement of the initial public offering through the earlier of the consummation of a business combination or the Company's liquidation, to pay the Sponsor a total of $15,000 per month for office space and administrative and support services. For the year ended March 31, 2026, the Company incurred $120,000 and paid the Sponsor $75,000 pursuant to the Administrative Services Agreement, as amended, the remaining $45,000 was accrued on the accompanying balance sheet.

Underwriting Agreement

We granted SPAC Advisory Partners ("SAP"), the representative of the underwriters, a 45-day option from the date of IPO, to purchase up to 1,080,000 additional Units to cover over-allotments, if any, at the IPO price less the underwriting discounts and commissions. The underwriter fully excised its over-allotment option on August 7, 2025.

The underwriters were paid a cash underwriting discount of 0.71% of the gross proceeds of the IPO, or $586,500. In addition, SAP will be entitled to a deferred fee of 4.0% of the gross proceeds of the IPO, or $3,312,000, which will be paid upon the closing of a Business Combination solely from amounts remaining in the Trust Account following all properly submitted shareholder redemption in connection with the consummation of the initial Business Combination and such deferred fee shall be capped at such amount so remaining in the Trust Account. On March 3, 2026, the Company entered into Amendment No. 1 to the Underwriting Agreement with Polaris Advisory Partners, LLC (f/k/a SPAC Advisory Partners), a division of Kingswood Capital Partners LLC, as representative of the underwriters, and Kingswood Capital Partners LLC, to revise the calculation and payment terms of the deferred underwriting commission. Pursuant to the Amendment, the deferred underwriting commission is payable from the Trust Account upon consummation of the Company's initial business combination and equals 4.00% of the gross proceeds from the sale of the firm units and option units, subject to a cap equal to 4.00% of the funds remaining in the Trust Account after giving effect to all properly submitted redemptions in connection with the initial business combination, and the underwriters may waive the deferred underwriting commission prior to the consummation of the initial business combination.

Right of First Refusal

We granted SAP a right of first refusal for a period commencing from the consummation of the IPO until the earlier of (i) 10 months after the consummation of the initial business combination (or the liquidation of the Trust Account in the event that the Company fails to consummate its initial business combination within the prescribed time period) or (ii) 36 months after the consummation of the IPO in accordance with FINRA Rule 5110(g)(6)(A) to act as lead financial advisor, capital markets advisor, underwriter and/or private placement agent in connection with any initial business combination or in connection with any financing that occurs between the closing of the IPO and the date that is the earlier of (i) 10 months after the closing of the initial business combination or (ii) 36 months after the consummation of the IPO.

Finder's Fee Agreement

On August 8, 2025, the Company entered into a Finder's Agreement with Aspira Capital Consulting LTD. Pursuant to the Finder's Agreement, the Company agreed to pay the Finder a one-time, non-refundable retainer fee in the amount of $300,000, payable upon the execution of Finder's Agreement. The Company also agreed to pay the Finder a success fee in the amount of $3,500,000, payable upon the closing (or closings) of a transaction (as defined in the Finder's Agreement). In addition, the Company agreed to reimburse the Finder on a monthly basis for all reasonable, actual, and verifiable out-of-pocket expenses incurred in connection with the Finder's engagement under the agreement, provided that such expenses shall not exceed $150,000 without the Company's prior written approval. The Company acknowledges and agrees that the Finder is not a registered broker-dealer under U.S. securities laws and is not acting as a broker-dealer in connection with the transaction. On February 21, 2026, the Company, the Finder and SACH Pte. Ltd. (the "Target") entered into Amendment No. 1 to the Finder's Agreement, pursuant to which the parties agreed that the $3,500,000 success fee will be satisfied in full through the issuance by the Target of 1,200,000 ordinary shares to the Finder at the closing of the business combination, with no cash payment owed by the Company. The Target acknowledged the Finder as the procuring cause of the transaction and assumed the obligation to issue such shares. As of March 31, 2026, the retainer fee of $300,000 had been paid in full, and there was no outstanding balance.

The Company acknowledges and agrees that the Finder is not a registered broker-dealer under U.S. securities laws, and is not acting as a broker-dealer in connection with the transaction.

Merger Agreement

In connection with the business combination agreement described under "Recent Developments-Merger Agreement," the Company may be subject to certain contractual obligations, including obligations relating to sponsor loans, potential termination fees and other transaction-related arrangements. The business combination agreement provides for customary termination rights and conditions, and may give rise to obligations upon the occurrence of certain events, including the termination of the agreement under specified circumstances. For additional information regarding the business combination agreement and the related transactions, see "Recent Developments-Merger Agreement" included elsewhere in this Annual Report on Form 10-K. Except as described above, the Company does not have any material contractual obligations as of the fiscal year ended March 31, 2026.

Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with GAAP 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 estimates.

Recent Accounting Standards

Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company's financial statements. Please refer to Note 2 of the financial statements for recent accounting pronouncements.

Off-Balance Sheet Arrangements; Commitments and Contractual Obligations;

As of March 31, 2026, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations.

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 initial public offering or until we are no longer an "emerging growth company," whichever is earlier.