What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-14 compared with 2025-08-14 · 131 added, 131 removed, 103 unchanged (72% of the section changed)

3 unchanged sentences

III, a Cayman Islands exempted company;

(ii) “founder shares” are to shares

of our Class B ordinary shares initially purchased by our Sponsor in a private placement prior to our initial public offering, and the

shares of our Class A ordinary shares issued upon the conversion thereof;

(ii) “founder shares” are

to shares of our Class B ordinary shares initially purchased by our Sponsor in a private placement prior to our initial public offering,

and the shares of our Class A ordinary shares issued upon the conversion thereof;

and (iii) “Sponsor” are to Blue Water Acquisition

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future events or otherwise.

We are a blank check company incorporated on November

1, 2024 as a Cayman Islands exempted company with no material operations of our own.

We were formed for the purpose of effecting a merger,

amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses,

which we refer to as our initial business combination.

We may pursue an initial business combination in any business or industry but expect

to focus on biotechnology, healthcare and technology companies.

Our units include shares of a Cayman Islands blank check company instead

of the shares of the operating entities with whom we may combine.

We intend to effectuate our initial business combination using cash

from the proceeds of the initial public offering and the private placement of the private placement units, the proceeds of the sale of

our shares in connection with our initial business combination (pursuant to forward purchase agreements or backstop agreements we may

enter into following the consummation of the initial public offering or otherwise), 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.

are a blank check company incorporated on November 1, 2024 as a Cayman Islands exempted company with no material operations of our own.

We were formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization

or similar business combination with one or more businesses, which we refer to as our initial business combination.

We may pursue an

initial business combination in any business or industry but expect to focus on biotechnology, healthcare and technology companies.

units include shares of a Cayman Islands blank check company instead of the shares of the operating entities with whom we may combine.

We intend to effectuate our initial business combination using cash from the proceeds of the initial public offering and the private

placement of the private placement units, the proceeds of the sale of our shares in connection with our initial business combination

(pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of the initial public offering

or otherwise), 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.

issuance of additional shares in connection with a business combination to the owners of the target or other investors:

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;

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;

subordinate the rights of holders of Class A ordinary shares if preference shares are issued with rights senior to those afforded

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Our only activities from November 1, 2024 (inception) through

June 30, 2025 relates to organizational activities, our initial public offering, and, subsequent to the initial public offering, our pursuit of an initial business

We will not generate any operating revenues until after completion of our initial business combination.

We will generate

non-operating income in the form of interest income on cash and cash equivalents after the initial public offering.

There has been no significant change

in our financial or trading position and no material adverse change has occurred since the date of our audited financial statements.

We have incurred, and 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.

Additionally, we expect our expenses to increase substantially after

identifying a target for our initial business combination.

the three months ended June 30, 2025, we had net income of $444,392, which consisted of $556,881 of interest income on the trust account,

offset by $89,301 of formation, general and administrative expenses, $12,723 of legal and accounting expenses, $6,333 of administrative

support fees, and $4,132 of insurance expense.

the six months ended June 30, 2025, we had net income of $368,570, which consisted of $556,881 of interest income on the trust account,

offset by $165,123 of formation, general and administrative expenses, $12,723 of legal and accounting expenses, $6,333 of administrative

support fees, and $4,132 of insurance expense.

September 30, 2025 relates to organizational activities, our initial public offering, and, subsequent to the initial public offering,

our pursuit of an initial business combination.

We will not generate any operating revenues until after completion of our initial business

We will generate non-operating income in the form of interest income on cash and cash equivalents after the initial public

There has been no significant change in our financial or trading position and no material adverse change has occurred since

the date of our audited financial statements.

We have incurred, and 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.

Additionally, we

expect our expenses to increase substantially after identifying a target for our initial business combination.

the three months ended September 30, 2025, we had net income of $2,292,067, which consisted of $2,715,577 of income earned on cash and

marketable securities held in the Trust Account, offset by $137,670 of formation, general and administrative expenses, $236,837 of legal

and accounting expenses, $30,000 of administrative support fees, and $19,003 of insurance expense.

the nine months ended September 30, 2025, we had net income of $2,660,637, which consisted of $3,272,459 of income earned on cash and

marketable securities held in the Trust Account, offset by $302,793 of formation, general and administrative expenses, $249,560 of legal

and accounting expenses, $36,333 of administrative support fees, and $23,136 of insurance expense.

and Capital Resources

of June 30, 2025 and December 31, 2024, we had cash of $1,039,666 and $0, respectively, and working capital (deficit) of $1,053,059 and

$(48,541), respectively.

the six months ended June 30, 2025, net cash used in by operating activities was $87,484.

Net income of $368,570 was increased by $101,708

of formation, general and administrative costs paid by the Sponsor under the promissory note, and decreased by $556,881 of interest income

on the trust account and an $881 decrease in operating assets and liabilities.

of September 30, 2025 and December 31, 2024, we had cash of $759,229 and $0, respectively, and working capital (deficit) of $577,284

and $(48,541), respectively.

the nine months ended September 30, 2025, net cash used in by operating activities was $367,921.

Net income of $2,660,637 was increased

by $101,708 of formation, general and administrative costs paid by the Sponsor under the promissory note and an $142,193 increase in

operating assets and liabilities, offset by $3,272,459 of interest income on the trust account .

Company has incurred and expects to continue to incur significant costs in pursuit of its financing and acquisition plans.

lacks the financial resources it needs to sustain operations for a reasonable period of time, which is considered to be one year from

the issuance date of the financial statement.

Although no formal agreement exists, the Sponsor is committed to extend Working Capital

Loans (defined in Note 6) as needed.

The Company cannot assure that its plans to consummate an initial Business Combination will be successful.

factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern one year from the date

these financial statements are issued.

These financial statements do not include any adjustments that might result from the outcome of this

liquidity needs have been satisfied to date through the purchase of founder shares from our Sponsor for $25,000, $300,000 in loans from

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of $259,830,000.

Following the closing of the initial public offering,

on June 11, 2025, an amount of $253,000,000 ($10.00 per unit) from the net proceeds of the sale of the Units and the Private Placement

Units, was placed in the trust account, with Continental Stock Transfer & Trust Company acting as trustee.

The funds are initially

to be held in cash, including demand deposit accounts at a bank, or invested only in U.S.

government treasury obligations 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, which invest

only in direct U.S.

the closing of the initial public offering, on June 11, 2025, an amount of $253,000,000 ($10.00 per unit) from the net proceeds of the

sale of the Units and the Private Placement Units, was placed in the trust account, with Continental Stock Transfer & Trust Company

acting as trustee.

The funds are initially to be held in cash, including demand deposit accounts at a bank, or invested only in U.S.

government treasury obligations 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, 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 management team’s ongoing assessment of all factors related to the 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.

Except with respect to interest earned on the funds held in the trust

account that may be released to us to pay our taxes, if any, the proceeds from the initial public offering and the sale of the private

placement units will not be released from the trust account until the earliest of (i) the completion of our initial business combination,

(ii) the redemption of our public shares if we are unable to complete the initial business combination within 24 months from the closing

of the initial public offering or by such earlier liquidation date as the Company’s board of directors may approve (the “Completion

Window”), subject to applicable law, or (iii) the redemption of our public shares properly submitted in connection with a shareholder

vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation

to allow redemption in connection with the initial business combination or to redeem 100% of our public shares if we have not consummated

an initial business combination within the Completion Window or (B) with respect to any other material provisions relating to shareholders’

rights or pre-initial business combination activity.

The proceeds deposited in the trust account could become subject to the claims of

our creditors, if any, which could have priority over the claims of our public shareholders.

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 management team’s ongoing assessment of all factors related to

the 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.

Except with respect

to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the proceeds from the

initial public offering and the sale of the private placement units will not be released from the trust account until the earliest of

(i) the completion of our initial business combination, (ii) the redemption of our public shares if we are unable to complete the initial

business combination within 24 months from the closing of the initial public offering or by such earlier liquidation date as the Company’s

board of directors may approve (the “Completion Window”), subject to applicable law, or (iii) the redemption of our public

shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association

to (A) modify the substance or timing of our obligation to allow redemption in connection with the initial business combination or to

redeem 100% of our public shares if we have not consummated an initial business combination within the Completion Window or (B) with

respect to any other material provisions relating to shareholders’ rights or pre-initial business combination activity.

deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims

of our public shareholders.

intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust

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target business or businesses, make other acquisitions and pursue our growth strategies.

of June 30, 2025, we have $1,039,666 of proceeds outside of the trust account.

We will 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.

do not anticipate that we will need to raise additional funds following the initial public offering in order to meet the expenditures required for

operating our business prior to our initial business combination.

However, if our estimates of the costs of identifying a target business,

undertaking in-depth due diligence and negotiating an initial 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 initial 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 loaned amounts.

In the event that our initial business combination does not close,

we may use amounts held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used for

such repayment.

Up to $1,500,000 of such loans may be convertible into private placement units of the post business combination entity

at a price of $10.00 per unit at the option of the lender.

Such units would be identical to the private placement units.

such loans, if any, have not been determined and no written agreements exist with respect to such 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.

of September 30, 2025, we have $759,229 of cash held outside of the trust account generated from the proceeds of the initial public offering.

We will 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.

do not anticipate that we will need to raise additional funds following the initial public offering in order to meet the expenditures

required for operating our business prior to our initial business combination.

However, if our estimates of the costs of identifying

a target business, undertaking in-depth due diligence and negotiating an initial 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 initial business combination.

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 loaned amounts.

In the event that our initial business combination

does not close, we may use amounts held outside the trust account to repay such loaned amounts but no proceeds from our trust account

would be used for such repayment.

Up to $1,500,000 of such loans may be convertible into private placement units of the post business

combination entity at a price of $10.00 per unit at the option of the lender.

Such units would be identical to the private placement

The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans.

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.

Sheet Arrangements

of June 30, 2025, 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.

No unaudited quarterly operating data is included in this report as we have not conducted

any operations to date.

do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities as of June 30, 2025 or

December 31, 2024.

Pursuant to the underwriting agreement for our initial

public offering, the underwriters are entitled to a deferred underwriting discount of 3.50% of the gross proceeds of the initial public

offering held in the trust account, or $8,855,000 in the aggregate, payable to BTIG, LLC to be deposited in the trust account and released

to BTIG, LLC only upon the completion of an initial business combination.

The deferred underwriting commissions will be payable as follows:

(i) $0.30 per Unit sold in the initial public offering will be paid to BTIG, LLC in cash upon the closing of the initial business combination

and (ii) $0.05 per Unit sold in the initial public offering will be payable to BTIG, LLC in cash, provided that the Company and the Sponsor

have the right, in the Company and the Sponsor’s discretion, to reallocate any portion of the Allocable Amount to third parties

not participating in the initial public offering (but who are members of FINRA) that assist the Company in consummating the initial business

We have entered into an administrative services agreement with an affiliate

of the Sponsor pursuant to which we are required to pay $10,000 per month for office space, utilities, and secretarial and administrative

services, commencing on effective date of the initial public offering, through the earlier of our initial business combination and our

of September 30, 2025, 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.

No unaudited quarterly operating data is included in this report as we have not

conducted any operations to date.

do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities as of September 30, 2025

or December 31, 2024.

to the underwriting agreement for our initial public offering, the underwriters are entitled to a deferred underwriting discount of 3.50%

of the gross proceeds of the initial public offering held in the trust account, or $8,855,000 in the aggregate, payable to BTIG, LLC

to be deposited in the trust account and released to BTIG, LLC only upon the completion of an initial business combination.

underwriting commissions will be payable as follows:

(i) $0.30 per Unit sold in the initial public offering will be paid to BTIG, LLC

in cash upon the closing of the initial business combination and (ii) $0.05 per Unit sold in the initial public offering will be payable

to BTIG, LLC in cash, provided that the Company and the Sponsor have the right, in the Company and the Sponsor’s discretion, to

reallocate any portion of the Allocable Amount to third parties not participating in the initial public offering (but who are members

of FINRA) that assist the Company in consummating the initial business combination.

have entered into an administrative services agreement with an affiliate of the Sponsor pursuant to which we are required to pay $10,000

per month for office space, utilities, and secretarial and administrative services, commencing on effective date of the initial public

offering, through the earlier of our initial business combination and our liquidation.

and Contingencies

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the filing of any such registration statements.

We granted the underwriters a 45-day option from the

date of the initial public offering to purchase up to an additional 3,300,000 units to cover over-allotments which was exercised in full

on the date of the initial public offering.

The underwriters were entitled to cash underwriting discount of 2.00% of the gross proceeds

of the units offered in the initial public offering, or $5,060,000 in the aggregate, which was paid to the underwriters upon the closing

of the initial public offering.

Additionally, the underwriters are entitled to a deferred underwriting discount of 3.50% of the gross

proceeds of the initial public offering held in the trust account, or $8,855,000 in the aggregate, payable to BTIG, LLC to be deposited

in the trust account and released to BTIG, LLC only upon the completion of an initial business combination.

The deferred underwriting

commissions will be payable as follows:

(i) $0.30 per Unit sold in the initial public offering will be paid to BTIG, LLC in cash upon

the closing of the initial business combination and (ii) $0.05 per Unit sold in the initial public offering will be payable to BTIG, LLC

in cash, provided that the Company and the Sponsor have the right, in the Company and the Sponsor’s discretion, to reallocate any

portion of the Allocable Amount to third parties not participating in the initial public offering (but who are members of FINRA) that

assist the Company in consummating the initial business combination.

granted the underwriters a 45-day option from the date of the initial public offering to purchase up to an additional 3,300,000 units

to cover over-allotments which was exercised in full on the date of the initial public offering.

The underwriters were entitled to cash

underwriting discount of 2.00% of the gross proceeds of the units offered in the initial public offering, or $5,060,000 in the aggregate,

which was paid to the underwriters upon the closing of the initial public offering.

Additionally, the underwriters are entitled to a

deferred underwriting discount of 3.50% of the gross proceeds of the initial public offering held in the trust account, or $8,855,000

in the aggregate, payable to BTIG, LLC to be deposited in the trust account and released to BTIG, LLC only upon the completion of an

initial business combination.

The deferred underwriting commissions will be payable as follows:

(i) $0.30 per Unit sold in the initial

public offering will be paid to BTIG, LLC in cash upon the closing of the initial business combination and (ii) $0.05 per Unit sold in

the initial public offering will be payable to BTIG, LLC in cash, provided that the Company and the Sponsor have the right, in the Company

and the Sponsor’s discretion, to reallocate any portion of the Allocable Amount to third parties not participating in the initial

public offering (but who are members of FINRA) that assist the Company in consummating the initial business combination.

Accounting Estimates

3 unchanged sentences

results could materially differ from those estimates.

We have not identified any critical accounting estimates as of June 30, 2025.

We have not identified any critical accounting estimates as of September 30, 2025.

Accounting Pronouncements

1 unchanged sentence

Quantitative and Qualitative Disclosures About Market Risk

As smaller reporting company, we are not required to make disclosures under

smaller reporting company, we are not required to make disclosures under this Item.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis