Duddell Street Acquisition Corp.

Income statement

Sources: [10-K FY2022 (FY2021–22); 10-K FY2023; ARS/10-K FY2025 (FY2024–25)]. Margins derived.

Partial-coverage rows (years with disclosed data only):

Derived from revenue less cost of revenues [10-K FY2022, FY2023, FY2024].

Sources: [10-K FY2023 non-GAAP reconciliation; FY2024 call transcript; DEF 14A 2026; Q4 2025 call summary]. FY2022 adjusted EBITDA reported as -24.4M in the FY2022 release and -24.45M in the FY2023 10-K — minor discrepancy noted.

[10-K FY2023]

Revenue CAGR FY2021–FY2025: ~3.6% (derived: 95.4/82.9 over 4 years). FY2023–FY2025 CAGR: ~-15.2% (derived).

Q4 2025 EPS was -USD 1.45 [StockTaper call summary]; Q2 2026 adjusted EPS -USD 1.06 vs. consensus -USD 0.43 [investing.com via Parqet]. FY2024 was the only year of positive GAAP net income, driven by a USD 71.5M gain on the Board.org sale (net loss excluding gain ~USD 62.5M) [10-K FY2024 XBRL].

Operating expense trajectory (FY2023 → FY2024) [10-K FY2024]:

Non-cash charges of note:

Sources: [10-K FY2023; 10-K FY2024 XBRL; ARS FY2025]. FY2022 goodwill impairment not confirmed (shown as 0 = none identified). H1 2026 goodwill impairment was a further USD 54.7M (Q1 ≈ 35.6M derived; Q2 19.1M) [10-Q Q2 2026].

Commentary. The five-year arc has three phases. (1) FY2021–FY2022: debt-fuelled acquisition growth. Revenue rose 37% in FY2022, but net losses ballooned to USD 218M as interest expense (USD 95.7M), a USD 45.3M extinguishment loss on the de-SPAC refinancing and a USD 11.7–12.0M lender loss contingency swamped gross profit. (2) FY2023–FY2024: efficiency and deleveraging. Revenue peaked at USD 132.6M in FY2023, adjusted EBITDA turned positive in Q3 2023, and FY2024 was the first full year of positive adjusted EBITDA (USD 9.8M, +1,400bp YoY margin). The Board.org sale produced FY2024's sole GAAP profit. (3) FY2025–FY2026: shrinking to the core. Divestitures cut reported revenue by 21% in FY2025; pro forma ARR still fell ~9%, showing organic erosion (legacy-product engagement issues, U.S. federal-sector instability, execution problems flagged in Q1 2025). Adjusted EBITDA held at USD 10.3M (10.8% margin), but GAAP results deteriorated through impairment and refinancing costs.

Balance sheet

FY2025 cash & equivalents alone not separately retrieved; FY2025 accumulated deficit derived (FY2024 deficit less FY2025 net loss).

Source: [ARS/10-K FY2025 balance sheet]. Intangibles total derived.

Debt composition (carrying values):

Sources: [10-Q Q1 2025; 10-K FY2025].

Latest position (30 Jun 2026) [10-Q Q2 2026]: cash, equivalents, restricted cash & short-term investments USD 20.6M; total debt USD 122.1M (third-party summaries cite ~USD 128M gross indebtedness — difference likely carrying vs. principal amounts); 2025 Senior Term Loan USD 70.3M; current liabilities USD 148.3M including USD 106.8M current maturities of long-term debt (debt reclassified to current on default risk); negative working capital (ex-cash) USD 135.0M; total stockholders' equity ~USD 0.3M; accumulated deficit USD 943.6M. After the FrontierView sale, USD 4.95M of term loans were prepaid [8-K, Sep 2026], implying a senior balance of roughly USD 65M (derived).

Net debt: ~USD 101.5M at 30 Jun 2026 (derived: 122.1 − 20.6).

Cash flow

Management targeted positive NTM free cash flow from 1 Apr 2026 (excluding restructuring costs) [Q1 2026 release].

Ratios

Commentary. Every leverage and coverage metric is in distress territory. Adjusted EBITDA has never covered cash interest, and the FY2026 guidance (USD 8–10M after FrontierView) still implies interest coverage around or below 1x on a ~USD 120M debt stack. The equity cushion has been eliminated by cumulative losses and impairments.

Management guidance (latest, 28 Aug 2026)

FY2026 revenue USD 74–76M and adjusted EBITDA USD 8–10M, excluding FrontierView after closing; outlook for the core Policy business unchanged. Management expects H1 restructuring to drive a meaningful H2 EBITDA ramp [PR 28 Aug 2026; Q2 2026 release]. Consensus growth expectations beyond 2026: not reliably available.

Bull case

1. Stabilising core: quarterly NRR recovered from 89% to 98% between Q1 and Q2 2026, and the legacy-platform migration overhang is behind the company.

2. Margin inflection: with 343 FTEs and ~87–88% adjusted gross margins, the cost base now supports Q3 2026 adjusted EBITDA guidance of ~USD 3.5M — an annualised run rate above USD 12M on ~USD 75M revenue.

3. Asset value exceeds equity price: FiscalNote has realised ~7x sales for Board.org and ~USD 40M for OA/Dragonfly; a sale of CQ Roll Call/PolicyNote/VoterVoice to a strategic buyer could clear the debt stack and leave residual value, which the CEO's CIC-linked incentives encourage.

Bear case

1. Creditor control: with covenant breaches, delisting defaults and ~USD 107M of debt in current liabilities, lenders hold the cards; a debt-for-equity exchange could wipe out or massively dilute existing Class A holders.

2. Structural churn: TTM NRR of 81%, ARR down 13% YoY and two guidance cuts in 2026 show the core is still shrinking, while each divestiture removes revenue and EBITDA alongside debt.

3. Interest burden and liquidity: adjusted EBITDA has never covered interest (0.62x in FY2025), cash fell to USD 20.6M, and goodwill impairments (USD 54.7M in H1 2026) signal management's own diminished value assessment.

Catalysts and monitorables (next 12 months)

• Disclosure on forbearance status after 22 Aug 2026 and any senior-lender waiver or amendment.

• Announcement of a liability-management transaction, recapitalisation or whole-company sale.

• Q3 2026 results (expected ~November 2026): delivery of ~USD 3.5M adjusted EBITDA guidance (pre-FrontierView basis) and NRR trend.

• FrontierView earn-out outcome (ARR tests at 30 Sep and 31 Dec 2026; up to USD 3.0M).

• First monetisation evidence from MCP licences and prediction-market initiatives.

• Quotation upgrade (OTCQB/OTCQX) or exchange relisting.

• FY2026 10-K: auditor going-concern opinion and further impairment.

Analyst verdict

Duddell Street Acquisition Corp. was a textbook 2020-vintage SPAC: a Hong Kong hedge-fund sponsor, a USD 175M trust and a USD 1.3B headline valuation for a fast-acquiring, loss-making policy-data company. Four years later, the successor, FiscalNote Holdings, is an OTC-quoted micro-cap with roughly USD 75M of revenue, about USD 120M of debt, near-zero book equity and an explicit going-concern warning. The arc from SPAC to distress is driven less by product failure than by capital structure: expensive acquisition debt consumed cash flows, forced fire-sale-adjacent divestitures and left the company too small to carry its obligations.

Operationally, there are genuine positives. PolicyNote is now the single platform, adjusted gross margins are high, quarterly retention has recovered toward 98%, and the MCP/API strategy is a thoughtful way to monetise proprietary data in an agentic-AI world. CQ Roll Call's content franchise and VoterVoice's advocacy network are assets a strategic or financial buyer could value.

But equity holders sit behind a senior term loan in covenant breach, subordinated notes in default under lapsed (publicly unextended) forbearance, and convertible instruments held by parties — including the new CEO's own fund — positioned to benefit from any recapitalisation. The prediction-markets initiative is speculative and pre-revenue; it should not be weighted in valuation.

Our assessment: FiscalNote's enterprise is likely viable; its current equity is not reliably so. The most probable paths over the next 12 months are (a) a negotiated debt restructuring with heavy dilution, or (b) a sale of the core business at a value that primarily satisfies creditors. Investors should treat NOTE shares as a high-risk option on restructuring terms, and monitor 8-K disclosures on lender negotiations above all operating metrics. For credit-oriented or strategic acquirers, the core policy-intelligence business may present an attractive, AI-relevant asset at a distressed entry point.