SIM Acquisition Corp. I 10-K

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Cautionary Note Regarding Forward-Looking Statements All statements other than statements of historical fact included in this Report including, without limitation, statements under this Item regarding our financial position, business strategy and the plans and objectives of Management for future operations, are forward-looking statements. When used in this Report, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions, as they relate to us or our Management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of our Management, as well as assumptions made by, and information currently available to, our Management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in our filings with the SEC. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by this paragraph. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the audited financial statements and the notes thereto contained elsewhere in this Report. Overview We are a blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a Business Combination. We have not selected any Business Combination target. We may pursue an initial Business Combination in any business or industry, but are focusing on companies in the healthcare industry. We intend to effectuate our initial Business Combination using cash from the proceeds of the Initial Public Offering and the Private Placement, the proceeds of the sale of our Ordinary Shares in connection with our initial Business Combination (pursuant to any forward purchase agreements or backstop agreements into which we may enter), Ordinary Shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. The issuance of additional Ordinary Shares in connection with a Business Combination to the owners of the target or other investors: ● may significantly dilute the equity interest of investors in the Initial Public Offering, which dilution would increase if the anti-dilution provisions in the Class B Ordinary Shares resulted in the issuance of Class A Ordinary Shares on a greater than one-to-one basis upon conversion of the Class B Ordinary Shares; ● may subordinate the rights of holders of Class A Ordinary Shares if preference shares are issued with rights senior to those afforded our Class A Ordinary Shares; ● could cause a change in control if a substantial number of our Class A Ordinary Shares are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors; ● may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; and ● may adversely affect prevailing market prices for our Class A Ordinary Shares and/or Warrants. Similarly, if we issue debt securities or otherwise incur significant debt to bank or other lenders or the owners of a target, it could result in: ● default and foreclosure on our assets if our operating revenues after an initial Business Combination are insufficient to repay our debt obligations; 28 ● acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; ● our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand; ● our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding; ● using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for expenses, capital expenditures, acquisitions and other general corporate purposes; ● limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; ● increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and ● limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. Pursuant to the Amended and Restated Memorandum, if we are unable to complete the initial Business Combination by July 11, 2026 (or such earlier time as determined by our Board) and an extension of the Combination Period is not otherwise approved by our shareholders, we 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 100% of the outstanding Public Shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned thereon (less taxes payable and up to $100,000 of interest income to pay dissolution expenses) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the Board, liquidate and dissolve. The Warrants will expire upon liquidation of the Trust Account and the holders of Warrants will receive no proceeds in connection with the liquidation. The holders of the Founder Shares will not participate in any redemption distribution with respect to their Founder Shares. We may seek to extend the Combination Period consistent with applicable laws, regulations and stock exchange rules by amending our Amended and Restated Memorandum. Such an amendment would require the approval of our Public Shareholders, who will be provided the opportunity to redeem all or a portion of their Public Shares in connection with the vote on such approval. Such redemptions will decrease the amount held in our Trust Account and our capitalization, and may affect our ability to maintain our listing on Nasdaq. In addition, Nasdaq’s rules currently require SPACs (such as us) to complete our initial Business Combination in accordance with the Nasdaq 36-Month Requirement. If we do not meet the Nasdaq 36-Month Requirement, our securities will likely be subject to a suspension of trading and delisting from Nasdaq. Recent Developments Sponsor Acquisition On January 28, 2026, the Buyers acquired all of the membership interests in the Sponsor owned by the non-managing members of the Sponsor pursuant to a securities purchase agreement. Simultaneously with such transaction, the Buyers also acquired all of the membership interests of Conroy Partners LLC, the managing member of the Sponsor, pursuant to a member interest purchase agreement. As a result of the foregoing transactions, the Buyers own all of the membership interests in the Sponsor. The Sponsor also acquired from Cantor 2,000,000 private placement warrants of the Company owned by Cantor pursuant to a securities purchase agreement. 29 In connection with the consummation of the Sponsor Acquisition, on January 28, 2026, Erich Spangenberg resigned as the Chairman of the Board and as the Chief Executive Officer of the Company, effective as of the closing of the Sponsor Acquisition. Delos M. Cosgrove, MD and Vincent Capone resigned as directors of the Board and as members of audit and compensation committees of the Board, effective as of the closing of the Sponsor Acquisition. On January 28, 2026, in connection with the Sponsor Acquisition, Christopher Devall was appointed as Chief Executive Officer of the Company. In addition, Anthony Hayes (as Chairman), Jarrett Gorlin, Matthew Saker, and Kyle Haug were appointed to serve as our Board of Directors, which changes became effective on March 7, 2026. Underwriter Fee Reduction Agreement On January 28, 2026, we and the Sponsor entered into the Fee Reduction Agreement with Cantor, as representative of the several underwriters for our initial public offering consummated on July 11, 2024. Pursuant to the Underwriting Agreement, Cantor was previously entitled to receive the Original Deferred Fee upon the consummation of our initial business combination. Pursuant to the Fee Reduction Agreement, and subject to the consummation of a business combination, Cantor has instead agreed to receive, the Reduced Deferred Fee. The Reduced Deferred Fee will be payable upon the closing of our initial business combination. If we (or our successor) fail to pay the Reduced Deferred Fee in full at such time, Cantor may elect to require us to pay the full amount of the Original Deferred Fee in cash. In addition, if we or the Sponsor becomes entitled to receive any break-up, termination or similar fee in connection with a proposed business combination that is terminated, abandoned or otherwise not consummated, 50% of the amount of such fee shall be applied toward payment of the Reduced Deferred Fee, subject to certain limitations set forth in the Fee Reduction Agreement. Administrative Services Agreements On January 28, 2026, the Administrative Services Agreement, dated July 9, 2024, by and between us and SIM Management LP, an affiliate of the Sponsor, was terminated, and any accrued obligations under the Administrative Services Agreement were waived. On March 18, 2026, the Company and Dominari Holdings Inc. entered into an administrative services agreement pursuant to which Dominari will provide office space, utilities and secretarial and administrative support to the Company in exchange for $20,000 per month. Mr. Hayes is the Chief Executive Officer of Dominari. Promissory Note with Sponsor On March 18, 2026, the Company entered into the 2026 Note. Pursuant to the 2026 Note, the interest rate is 12% per annum, based on actual days / 360 and there is a 5.0% original issue discount (OID). The 2026 Note is due and payable upon the earlier to occur of: (1) our initial Business Combination, or (2) our liquidation. Results of Operations We have neither engaged in any operations nor generated any revenues to date. Our only activities from inception to December 31, 2025 have been (i) organizational activities and (ii) activities relating to (x) the Initial Public Offering, and (y) identifying and evaluating prospective acquisition candidates and activities in connection with the initial Business Combination. We will not generate any operating revenues until after completion of our initial Business Combination. We have generated non-operating income in the form of interest income on cash and cash equivalents subsequent to the Initial Public Offering, and incurred 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. For the year ended December 31, 2025, we had net income of $8,789,649, which includes $9,795,490 of interest income earned on the Trust Account, offset by $1,005,841 of general and administrative costs. For the period from January 29, 2024 (inception) to December 31, 2024, we had net income of $4,747,104 which includes $5,322,812 of interest income earned on the Trust Account, offset by $575,708 of general and administrative costs. 30 Liquidity, Capital Resources and Going Concern Until the consummation of the Initial Public Offering, our only source of liquidity was an initial purchase of Class B Ordinary Shares by the Sponsor and loans from the Sponsor. On January 29, 2024, the Sponsor agreed to loan us up to $300,000 to cover expenses related to the Initial Public Offering pursuant to the IPO Promissory Note. This loan was non-interest bearing and payable on the earlier of December 31, 2024 or the completion of the Initial Public Offering. As of July 11, 2024, the IPO Promissory Note was repaid in full at the closing of the Initial Public Offering and the IPO Promissory Note is no longer accessible. On July 11, 2024 we consummated the Initial Public Offering of 23,000,000 Units, which includes the full exercise of the Over-Allotment Option in the amount of 3,000,000 Units, at $10.00 per Unit, generating gross proceeds of $230,000,000. The net proceeds from the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants in the Private Placement for an aggregate purchase price of $6,000,000, after deducting offering expenses of approximately $477,616 and underwriting commissions of $4,000,000 (excluding deferred underwriting commissions of $10,950,000), was $231,522,384. $230,000,000 has been held in the Trust Account, which includes the deferred underwriting commissions described above. The proceeds held in the Trust Account are invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. The holding of these assets in this form is intended to be temporary and for the sole purpose of facilitating the intended Business Combination. To mitigate the risk that we might be deemed to be an investment company for purposes of the Investment Company Act, which risk increases the longer that we hold investments in the Trust Account, we may, at any time, (based on our Management Team’s ongoing assessment of all factors related to our potential status under the Investment Company Act) instruct the trustee to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account in cash or in an interest bearing demand deposit account at a bank. We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (excluding deferred underwriting commissions). We may withdraw interest to pay our taxes, if any. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the Trust Account. We expect the interest earned on the amount in the Trust Account will be sufficient to pay our income taxes. To the extent that our equity 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 will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies. We have available to us approximately $65,427 of proceeds held outside the Trust Account, as of December 31, 2025. In addition, on March 18, 2026, we entered into the 2026 Note, providing us access to up to an additional $1.5 million. We expect to continue to use these funds to primarily identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a Business Combination. In order to fund working capital deficiencies or finance transaction costs in connection with an intended initial Business Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete our initial Business Combination, we would repay such Working Capital Loans. In the event that our initial Business Combination does not close, we may use amounts held outside the Trust Account to repay such Working Capital Loans, but no proceeds from our Trust Account would be used for such repayment. Up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity at a price of $1.00 per warrant at the option of the lender, or on such other terms as may be approved by the Board, and shareholders, if required pursuant to applicable law. The terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such Working Capital Loans. Prior to the completion of our initial Business Combination, we do not expect to seek loans from parties other than our Sponsor or an affiliate of our Sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account. 31 We have until July 11, 2026 to consummate a Business Combination, unless extended by amending our Amended and Restated Memorandum. It is uncertain that the Company will be able to consummate a Business Combination by this time. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. In connection with the Company’s assessment of going concern considerations in accordance with ASC 205-40, “Presentation of Financial Statements – Going Concern,” as of December 31, 2025, management has determined that the mandatory liquidation and subsequent dissolution raises substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. In addition, the Company’s cash balance does not exceed its current budgeted operating requirements, and management has concluded that this indicates the Company will not have sufficient liquidity to meet its obligations as they become due within one year after the date these financial statements are issued. Other than the 2026 Note, we do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business Combination. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our Public Shares upon consummation of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination. Contractual Obligations We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than as set forth below. Underwriting Agreement The underwriters of the Initial Public Offering have agreed to receive deferred underwriting commissions equal to $0.45 per Unit on Units other than those sold pursuant to the Over-Allotment Option, or $9,000,000 in the aggregate, with an additional $1,950,000 due in connection with the full exercise of the Over-Allotment Option. Consequently, upon completion of our initial Business Combination, $10,950,000 will be paid to the underwriters of the Initial Public Offering from the funds held in the Trust Account. The deferred fee will become payable to the underwriters of the Initial Public Offering solely in the event that we complete a Business Combination, subject to the terms of the Underwriting Agreement, d ated July 9, 2024, we entered into with Cantor, as representative of the several underwriters of the Initial Public Offering . If we fail to consummate an initial Business Combination within the Combination Period, such deferred fee will be included with the funds held in the Trust Account that will be available to fund the redemption of our Public Shares upon the liquidation of the Trust Account. On January 28, 2026, we and the Sponsor entered into the Fee Reduction Agreement with Cantor, as representative of the several underwriters for our initial public offering consummated on July 11, 2024. Pursuant to the Underwriting Agreement, Cantor was previously entitled to receive the Original Deferred Fee upon the consummation of our initial business combination. Pursuant to the Fee Reduction Agreement, and subject to the consummation of a business combination, Cantor has instead agreed to receive, in lieu of the Original Deferred Fee, a non-refundable cash fee equal to 1.5% of the aggregate amount delivered from our trust account upon the closing of our initial business combination. The Reduced Deferred Fee will be payable upon the closing of our initial business combination. If we (or its successor) fail to pay the Reduced Deferred Fee in full at such time, Cantor may elect to require the Company to pay the full amount of the Original Deferred Fee in cash. 32 In addition, if we or the Sponsor becomes entitled to receive any break-up, termination or similar fee in connection with a proposed business combination that is terminated, abandoned or otherwise not consummated, 50% of the amount of such fee shall be applied toward payment of the Reduced Deferred Fee, subject to certain limitations set forth in the Fee Reduction Agreement. In addition, if the Company or the Sponsor becomes entitled to receive any break-up, termination or similar fee in connection with a proposed business combination that is terminated, abandoned or otherwise not consummated, 50% of the amount of such fee shall be applied toward payment of the Reduced Deferred Fee, subject to certain limitations set forth in the Fee Reduction Agreement. Administrative Services Agreement Commencing on July 10, 2024, and terminated on January 28, 2026, we paid an affiliate of our Sponsor $10,000 per month for c ertain office space, utilities and secretarial and administrative support pursuant to the Administrative Services Agreement. Under the Administrative Services Agreement, there was $110,000 incurred and paid for the year ending December 31, 2025. On January 28, 2026, the Administrative Services Agreement, dated July 9, 2024, by and between the Company and SIM Management LP, an affiliate of the Sponsor, was terminated, and any accrued obligations under the Administrative Services Agreement were waived. On March 18, 2026, the Company and Dominari Holdings Inc. entered into an administrative services agreement pursuant to which Dominari will provide office space, utilities and secretarial and administrative support to the Company in exchange for $20,000 per month. Mr. Hayes is the Chief Executive Officer of Dominari. Promissory Note with Sponsor Also on March 18, 2026 the Company entered into the 2026 Note. Pursuant to the 2026 Note, the interest rate is 12% per annum, based on actual days / 360 and there is a 5.0% original issue discount (OID). The 2026 Note is due and payable upon the earlier to occur of: (1) our initial Business Combination, or (2) our liquidation. Critical Accounting Estimates The preparation of the audited financial statements contained elsewhere in this Report 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. Making estimates requires Management to exercise significant judgement. 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, actual results could materially differ from those estimates. As of December 31, 2025, we did not have any critical accounting estimates to be disclosed. Item 7A. Quantitative and Qualitative Disclosures about Market Risk. We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this Item. Item 8. Financial Statements and Supplementary Data. Reference is made to pages F-1 through F-21 comprising a portion of this Report, which are incorporated herein by reference. 33 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.