{"url_path":"/sec/qums/10-k/2026/item-13","section_key":"item-13","section_title":"Item 13 Certain Relationships and Related Transactions, and Director Independence.**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-15","source_url":"https://www.sec.gov/Archives/edgar/data/2070900/0001829126-26-006482-index.html","accession_number":"0001829126-26-006482","cik":"0002070900","ticker":"QUMS","issuer_name":"Quantumsphere Acquisition Corp","edgar_url":"https://www.sec.gov/Archives/edgar/data/2070900/0001829126-26-006482-index.html","primary_entity_key":"0002070900","primary_entity_name":"Quantumsphere Acquisition Corp"},"word_count":1888,"has_tables":true,"body_markdown":"**Item 13. Certain Relationships and Related Transactions, and Director Independence.**\n\n \n\nOn August 5, 2025, the Company issued to the Sponsor 2,898,000 ordinary shares, which we refer to herein as “founder shares,” for an aggregate purchase price of $25,000. Up to 378,000 founder shares were subject to forfeiture by the Sponsor depending on the extent to which the underwriter’s over-allotment option was exercised. As a result of the underwriter’s full exercise of its over-allotment option on August 7, 2025, no founder shares were forfeited. Our Sponsor, Whiteowl Holdings LLC, is controlled by Mr. Ping Zhang, who also serves as our Chairman, Chief Executive Officer and Chief Financial Officer.\n\n \n\nOn August 7, 2025, the Company consummated its initial public offering (the “IPO”) of 7,200,000 units (the “Units”). Each Unit consists of one ordinary share, par value $0.0001 per share, of the Company (the “Ordinary Shares”) and one right to receive one-seventh (1/7) of one Ordinary Share upon the consummation of the Company’s initial business combination. The Units were sold at an offering price of $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 an additional 1,080,000 Units, resulting in the sale of an aggregate of 8,280,000 Units and total gross proceeds of $82,800,000.\n\n \n\nSimultaneously with the consummation of the IPO and the sale of the Units, the Company consummated the private placement (the “Private Placement”) of 228,650 Units (the “Private Placement Units”), each Private Placement Unit consisting of one Ordinary Share and one right, to the Sponsor at a price of $10.00 per Private Placement Unit, generating total gross proceeds of $2,286,500. The issuance of the Placement Units was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended.\n\n \n\nA total of $82,800,000 of the net proceeds from the IPO and the Private Placement were placed in a U.S.-based trust account established for the benefit of the Company’s public shareholders and maintained by Continental Stock Transfer & Trust Company, acting as trustee.\n\n \n\nOn September 30, 2025 the Company announced that holders of the Company’s units could elect to separately trade the ordinary shares and rights included in its units. The ordinary shares and rights are expected to trade on the Nasdaq Stock Market LLC (“Nasdaq”) under the symbols “QUMS” and “QUMSR,” respectively. Units not separated will continue to trade on Nasdaq under the symbol “QUMSU.” Holders of units will need to have their brokers contact the Company’s transfer agent, Continental Stock Transfer & Trust Co., in order to separate the holders’ Units into ordinary shares and rights.\n\n \n\nAs more fully discussed in “Item 10. Directors, Executive Officers and Corporate Governance — Conflicts of Interest,” if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us, subject to his or her fiduciary duties under Cayman Islands law. Our officers and directors currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us.\n\n \n\nWe entered into an Administrative Services Agreement\nwith our Sponsor on November 5, 2024, pursuant to which the Company agreed to pay the Sponsor a total of $15,000 per month for office\nspace, administrative and support services commencing on the date that the Company’s securities were first listed on Nasdaq through\nthe earlier of the consummation of the Company’s initial business combination or the Company’s liquidation. For the year ended\nMarch 31, 2026, the Company incurred $120,000 and paid the Sponsor $75,000 pursuant to the Administrative Services Agreement, as\namended, the remaining $45,000 was accrued on the accompanying balance sheet.\n\n \n\nOur Sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made to our Sponsor, officers, directors or our or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.\n\n \n\n40\n\n \n\n \n\nPursuant to our amended and restated memorandum and articles of association, we may extend the period of time to consummate a business combination up to 18 months to complete a business combination in accordance with the terms thereof, without submitting such proposed extensions to our shareholders for approval or offering our public shareholders redemption rights in connection therewith. Our sponsor or its affiliates or designees are not obligated to fund the trust account to extend the time for us to consummate an initial business combination. If we are unable to consummate an initial business combination within such time period, we will redeem 100% of our issued and outstanding public shares for a pro rata portion of the funds held in the trust account, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $50,000 of interest to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and as further described herein, and then seek to liquidate and dissolve. We expect the pro rata redemption price to be approximately $10.25 per Class A ordinary share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest earned on such funds.\n\n \n\nAfter our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company with any and all amounts being fully disclosed to our shareholders, to the extent then known, in the tender offer or proxy solicitation materials, as applicable, furnished to our shareholders. It is unlikely the amount of such compensation will be known at the time of distribution of such tender offer materials or at the time of a shareholder meeting held to consider our initial business combination, as applicable, as it will be up to the directors of the post-combination business to determine executive and director compensation.\n\n \n\nWe have entered into a registration rights agreement with respect to the founder shares, representative shares, private placement units, and units that may be issued on conversion of working capital loans (and in each case holders of their component securities, as applicable).\n\n \n\n**Related Party Policy**\n\n \n\nWe have not yet adopted a formal policy for the review, approval or ratification of related party transactions. Accordingly, the transactions discussed above were not reviewed, approved or ratified in accordance with any such policy.\n\n \n\nWe have adopted a code of ethics requiring us to avoid, wherever possible, all conflicts of interests, except under guidelines or resolutions approved by our Board of Directors (or the appropriate committee of our board) or as disclosed in our public filings with the SEC. Under our code of ethics, conflict of interest situations will include any financial transaction, arrangement or relationship (including any indebtedness or guarantee of indebtedness) involving the Company. You will be able to review these documents by accessing our public filings at the SEC’s web site at *www.sec.gov*. In addition, a copy of the Code of Ethics will be provided without charge upon request from us. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K.\n\n \n\nIn addition, our audit committee is responsible for reviewing and approving related party transactions to the extent that we enter into such transactions. An affirmative vote of a majority of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous written consent of all of the members of the audit committee will be required to approve a related party transaction. A form of the audit committee charter that we have adopted prior to the consummation of this offering is filed as an exhibit to the registration statement of which this prospectus is a part. We also require each of our directors and executive officers to complete a directors’ and officers’ questionnaire that elicits information about related party transactions.\n\n \n\nThese procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer.\n\n \n\n41\n\n \n\n \n\nTo further minimize conflicts of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated with any of our sponsor, officers or directors unless we, or a committee of independent directors, have obtained an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm, that our initial business combination is fair to our company from a financial point of view. Furthermore, no finder’s fees, reimbursements or cash payments will be made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination. However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination:\n\n \n\n \n●\nRepayment of amounts borrowed under an unsecured, interest-free promissory note in an aggregate principal amount of up to $700,000 issued by the Company to the Sponsor in connection with the initial public offering;\n\n \n\n \n●\nPayment to an affiliate of our sponsor of $15,000 per month, commencing on the effective date of the registration statement of our initial pubic offering through the earlier of the consummation of our initial business combination or the Company’s liquidation, for office space, utilities and secretarial and administrative support; and\n\n \n\n \n●\nReimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination.\n\n \n\nOur audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates.\n\n \n\n**Director Independence**\n\n \n\nThe Nasdaq listing standards require that a majority of our Board of Directors be independent. An “independent director” is defined generally as a person who has no material relationship with the listed company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the company). Our board has determined that each of Wei (Victor) Zhang, Daniel M. McCabe and Qi Gong is an independent director under applicable SEC and Nasdaq rules. Our independent directors will have regularly scheduled meetings at which only independent directors are present."}