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Item 2. Management’s Discussion and Analysis

2026-08-21 compared with 2026-05-14 · 281 added, 237 removed, 7 unchanged (99% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” or refer to FG Merger II Corp.

References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to FG Merger Investors II LLC.

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Quarterly Report.

Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Exchange Act that are not historical facts, and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected.

All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements.

Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements.

Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available.

A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements.

For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to our final prospectus filed in connection with our IPO (as defined below), under Cautionary Note Regarding Forward-Looking Statements and Risk Factors.

References in this report (the “Quarterly Report”) to “we,”

“us” or the “Company” refer to FG Merger II Corp, prior to its consummation of the Business Combination with

References to our “management” or our “management team” refer to our officers and directors, and

references to the “Sponsor” refer to FG Merger Investors II LLC.

The following discussion and analysis of the Company’s

financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained

elsewhere in this Quarterly Report as well as:

unaudited interim consolidated financial statements of Legacy BOXABL as of and for the three

and six months ended June 30, 2026 and June 30, 2025, which are included as Exhibit 99.1

· Management’s

Discussion and Analysis of Financial Condition and Results of Operations of Legacy BOXABL

for the three and six months ended June 30, 2026, which is included as Exhibit 99.2 hereto,

Certain information contained in the discussion and analysis set forth

below includes forward-looking statements that involve risks and uncertainties.

Note Regarding Forward-Looking Statements

Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as

amended (the “Securities Act”) and Section 21E of the Exchange Act that are not historical facts, and involve risks and uncertainties

that could cause actual results to differ materially from those expected and projected.

All statements, other than statements of historical

fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of

Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans

and objectives of management for future operations, are forward-looking statements.

Words such as “expect,” “believe,”

“anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions

are intended to identify such forward-looking statements.

Such forward-looking statements relate to future events or future performance,

but reflect management’s current beliefs, based on information currently available.

A number of factors could cause actual events,

performance, or results to differ materially from the events, performance and results discussed in the forward-looking statements.

information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking

statements, please refer to the Registration Statement on Form S-4 (as amended) and the definitive proxy statement/prospectus relating

to the Mergers filed by FGMC with the SEC, under the section titled “Risk Factors”, under Cautionary Note Regarding

Forward-Looking Statements and Risk Factors.

The Company’s securities filings can be accessed on the EDGAR section of the U.S.

Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.

Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

FG Merger II Corp.

(the “Company”) is a blank check company incorporated in Nevada on September 20, 2023.

The Company was formed for the purpose of merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (“Business Combination”).

Although the Company is not limited to a particular industry or geographic region for purposes of consummating a Business Combination, the Company intends to focus on businesses in the financial services industry.

The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

As of March 31, 2026, the Company had not yet commenced any operations.

All activity through March 31, 2026 relates to the Company’s formation and the initial public offering (“IPO”), which is described below.

The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest.

The Company will generate nonoperating income in the form of interest income from the proceeds derived from the IPO.

Except as expressly required by applicable securities

law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new

information, future events or otherwise.

Merger II Corp.

(the “Company”) was, prior to the consummation of the Mergers, a blank check company incorporated in

Nevada on September 20, 2023.

The Company was formed for the purpose of merger, share exchange, asset acquisition, stock purchase,

recapitalization, reorganization or other similar business combination with one or more businesses or entities (“Business

Combination”).

of June 30, 2026, the Company had not yet commenced any operations.

All activity through June 30, 2026 relates to the

Company’s formation and the initial public offering (“IPO”), which is described below.

The Company did not reflect

any operating revenues until after the completion of the Business Combination.

Until the consummation of the Business Combination,

discussed below, the Company generated non-operating income in the form of interest income from the proceeds derived from the IPO.

The Company has selected December 31 as its fiscal year end.

Recent Developments

Our registration statement was declared effective on January 28, 2025.

On January 30, 2025, we consummated our IPO of 8,000,000 units at $10.00 per unit (the “Units”).

Each Unit consist of one share of common stock of the Company, par value $0.0001 per shares (“Public Shares”) and one right to receive one-tenth common share (“Public Right”).

The Units were sold at a price of $10.00 per Unit, generating gross proceeds to the Company of $80,000,000.

Simultaneously with the closing of the IPO, we consummated private placement ( “Private Placement”) in which i) FG Merger Investors II LLC (the “Sponsor”) and Ramnaraine Jaigobind purchased 223,300 and 25,000 private unit ( the “Private Units”) respectively, at a price of $10.00 per Private Unit, generating total proceeds of $2,483,000 and ii) the Sponsor purchased in aggregate of 1,000,000 $15.00 exercise price warrants (the “$15 Private Warrants”) at a price of $0.10 per $15 Private Warrant, each exercisable to purchase one shares of common stock at $15.00 per share, for an aggregate purchase price of $100,000.

Each Private Unit consists of one common share and one right.

right (“Private Unit Right”).

Each whole Private Unit Right entitles the holder to convert the right to one-tenth share of common stock.

Each $15 Private Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $15.00 per each share, will be exercisable for a period of 10 years from the date of Business Combination, will be non-redeemable, and may be exercised on a cashless basis.

Additionally, $15 Private Warrants and the shares issuable upon the exercise of the $15 Private Warrants are not to be transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions.

Our Units are listed on the National Association of Securities Dealers Automated Quotations (“Nasdaq”).

Our management has broad discretion with respect to the specific application of the net proceeds of the IPO and sale of the $15 Private Warrants, and Private Units, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination.

Nasdaq rules provide that the Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the net assets held in the Trust Account (as defined below) (excluding any deferred underwriting commissions and taxes payable on interest earned on the Trust Account).

The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940 as amended (the “Investment Company Act”).

There is no assurance that the Company will be able to successfully effect a Business Combination.

Following the closing of the IPO, and amount of $80,800,000 ($10.10 per Unit) from the net proceed of the sale of the Units in the IPO and the sale of Private Placement Securities were placed in a trust account (“Trust Account”) account (“Trust Account”) and invested in a money market fund, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by us, until the earlier of:

(i) the consummation of a Business Combination or (ii) the distribution of the funds in the Trust Account to the Company’s stockholders, as described below.

We will provide our stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer.

In connection with a proposed Business Combination, we may seek stockholder approval of a Business Combination at a meeting called for such purpose at which stockholders may seek to redeem their shares, regardless of whether they vote for or against the proposed Business Combination.

In the event that we seeks stockholder approval in connection with a Business Combination, we will proceed with the Business Combination only if a majority of the outstanding shares voted are voted in favor of the Business Combination.

If we seeks stockholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, our amended and restated articles of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares without the Company’s prior written consent.

The holders of Public Shares are entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (including any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations).

There will be no redemption rights upon the completion of a Business Combination with respect to our warrants.

If a stockholder vote is not required and if we decide not to hold a stockholder vote for business or other legal reasons, we will, pursuant to its amended and restated articles of incorporation, offer such redemption pursuant to the tender offer rules of the Securities and Exchange Commission (“SEC”), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.

The Sponsor, officers, directors and advisors (the “Initial Stockholders”) have agreed (a) to vote their Founder Shares (as defined in Note 5) as well as any common shares underlying the Private Units, and any Public Shares purchased during or after the IPO in favor of a Business Combination, (b) not to propose an amendment to our amended and restated articles of incorporation with respect to the our pre-Business Combination activities prior to the consummation of a Business Combination unless we provides dissenting public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment;

(c) not to redeem any shares (including the Founder Shares as well as any common shares underlying the Private Units) into the right to receive cash from the Trust Account in connection with a stockholder vote to approve a Business Combination (or to sell any shares in a tender offer in connection with a Business Combination if we do not seek stockholder approval in connection therewith) or a vote to amend the provisions of the amended and restated articles of incorporation relating to stockholders’ rights of pre-Business Combination activity and (d) that the Founder Shares, the Private Units and $15 Private Warrant (including underlying securities) shall not participate in any liquidating distributions upon winding up if a Business Combination is not consummated.

However, the Initial Stockholders will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares purchased during or after the IPO if we fail to complete our Business Combination.

We have until 24 months from the closing of the IPO to complete a Business Combination.

If we are unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no 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 (net of funds withdrawn for working capital purposes (not to exceed $1,000,000 annually) and taxes payable and less interest to pay dissolution expenses up to $100,000), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and our board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations to provide for claims of creditors and the requirements of applicable law.

There will be no redemption rights or liquidation distribution with respect to our warrants, which will expire worthless if we fail to complete our initial Business Combination within the Combination period.

The Sponsor has agreed that it will be liable to us, if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amounts in the Trust Account to below $10.10 per share, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”).

In the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims.

We will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, prospective target businesses or other entities with which we do business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

Merger Agreement

On August 4, 2025, FGMC, Boxable Inc.

(“Target” or “BOXABLE”) and FG Merger Sub II Inc., a Nevada corporation and wholly-owned subsidiary of FGMC (“Merger Sub”) entered into an Agreement and Plan of Merger (the “Merger Agreement”).

The Merger Agreement provides for a two-step merger transaction (the “Mergers”) in which, first, Merger Sub will merge with and into BOXABL (the “First Merger”), with BOXABL surviving as a wholly-owned subsidiary of FGMC, and, immediately thereafter, BOXABL (as the surviving company in the First Merger) will merge with and into FGMC (the “Second Merger”), with Company continuing as the surviving public company (the “Combined Company”).

By virtue of the consummation of the Mergers, the Combined Company will change its name to BOXABL Inc.

The Boards of Directors of BOXABL, Company, and Merger Sub have unanimously approved the Merger Agreement and the transactions contemplated thereby.

Consideration

The aggregate merger consideration to be received by BOXABL stockholders is equal to a combination of preferred and common shares of FGMC that equals a total of $3,500,000,000, each at a deemed value of $10 per share.

There is no minimum cash required to close the Merger.

Closing Conditions

The closing of the Mergers is subject to customary closing conditions, including, among others, approval of the transaction by the stockholders of BOXABL and FGMC, effectiveness of a registration statement on Form S-4 to be filed by the Company with the SEC in connection with the transaction, expiration or termination of any applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act, accuracy of representations and warranties, approval for listing of the Combined Company Common Stock on Nasdaq or NYSE, absence of any law or order prohibiting the consummation of the transaction, and other conditions as set forth in the Merger Agreement.

The Merger Agreement may be terminated and the transactions contemplated thereby abandoned at any time prior to the closing under certain specified circumstances.

Either BOXABL or FGMC may terminate the agreement by written notice if the closing has not occurred on or before December 31, 2025 (the “Agreement End Date”), provided that the right to terminate on this basis is not available to any party whose breach of the agreement has proximately caused the failure of the closing to occur by such date.

Termination is also permitted by mutual written consent of the parties, or by either party if a governmental authority enacts a law or order that makes consummation of the transactions illegal or otherwise prohibits the transaction, so long as the terminating party or its subsidiaries did not cause such prohibition by their own breach.

On November 3, 2025, Company entered into an amendment (the “Amendment”) to the Merger Agreement with Boxable.

Pursuant to the Amendment, the parties to the Merger Agreement agreed to extend the Agreement End Date for the Merger Agreement from December 31, 2025, to March 31, 2026.

On April 6, 2026, Company entered into an amendment (the “Second Amendment ”) to the Merger Agreement with BOXABL.

Pursuant to the Second Amendment, the parties to the Merger Agreement agreed to extend the Agreement End Date for the Merger Agreement from March 31, 2026, to July 31, 2026.

Termination Provisions

Additional termination rights include the ability for either party to terminate if the required stockholder approvals from either BOXABL or FGMC are not obtained at their respective stockholder meetings, unless the failure to obtain such approval is due to the action or inaction of the party seeking termination.

The agreement may also be terminated by one party if the other party has committed a material breach of its representations, warranties, or covenants that would prevent the satisfaction of closing conditions, subject to a cure period of up to thirty (30) days (or any shorter period remaining before the Agreement End Date) after notice of such breach.

Upon termination, the agreement becomes void and has no further effect, except for certain provisions that expressly survive, and subject to liability for any willful and material breach or actual fraud occurring prior to termination.

Each party is responsible for its own fees and expenses incurred in connection with the agreement and the contemplated transactions, except as otherwise provided.

Certain Related Agreements

In connection with the execution of the Merger Agreement, the sponsor of FGMC, entered into a support agreement pursuant to which it agreed to vote its shares of FGMC in favor of the transaction and take certain other actions in support of the Mergers (the “Sponsor Support Agreement”).

Certain stockholders of the BOXABLE entered into a support agreement pursuant to which they agreed to vote their shares of BOAXABLE in favor of the transaction and take certain other actions in support of the Mergers (the “BOXABLE Support Agreement”).

At closing, BOXABLE and FGMC will enter into lock-up agreements with certain BOXABLE stockholders (the “BOXABLE Lock-Up Agreements”) and with the sponsor (the “Sponsor Lock-Up Agreement”), restricting the transfer of certain shares for specified periods following the closing.

Results of Operations

We have neither engaged in any operations nor generated any revenues to date.

Our only activities through March 31, 2026 were organizational activities, including those necessary to identifying and working with the target company for a Business Combination.

We do not expect to generate any operating revenues until after the completion of our Business Combination.

We generate non-operating income in the form of interest income on marketable securities.

We incur 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 completing a Business Combination.

For the three months ended March 31, 2026, the Company reported net income of $287,762, which consists of $722,224 in investment income earned in Trust Account, offset by $273,298 in general and administrative expenses and $161,164 income tax expense.

For the three months ended March 31, 2025, the Company reported a net income of $315,350 which consists of $559,755 in investment income earned in Trust Account, offset by $126,856 in general and administrative expenses and $117,549 in income tax expense.

Liquidity and Capital Resources

As of March 31, 2026, we held a cash balance of $243,235.

Prior to the IPO, our liquidity needs were satisfied through the $25,000 proceeds received from the Sponsor for purchase of Founder Shares (as defined below), as well as $125,000 loan from Sponsor under a promissory note (“Promissory Notes”).

On January 28, 2025, we issued an unsecured promissory note of $417,000 to the Sponsor.

This promissory note bear interest at the rate of 12% per year and will mature on January 30, 2026.

IPO registration statement was declared effective on January 28, 2025.

On January 30, 2025, we consummated our IPO of 8,000,000 units

at $10.00 per unit (the “Units”).

Each Unit consist of one share of common stock of the Company, par value $0.0001 per shares

(“Public Shares”) and one right to receive one-tenth common share (“Public Right”).

The Units were sold at a

price of $10.00 per Unit, generating gross proceeds to the Company of $80,000,000.

Simultaneously

with the closing of the IPO, we consummated private placement ( “Private Placement”) in which i) FG Merger Investors II LLC

(the “Sponsor”) and Ramnaraine Jaigobind purchased 223,300 and 25,000 private units ( the “Private Units”) respectively,

at a price of $10.00 per Private Unit, generating total proceeds of $2,483,000 and ii) the Sponsor purchased an aggregate of 1,000,000

$15.00 exercise price warrants (the “$15 Private Warrants”) at a price of $0.10 per $15 Private Warrant, each exercisable

to purchase one share of common stock at $15.00 per share, for an aggregate purchase price of $100,000.

Private Unit consisted of one common share and one right (“Private Unit Right”).

Each whole Private Unit Right entitled the

holder to convert the right to one-tenth share of common stock.

$15 Private Warrant entitled the holder to purchase one share of Common Stock at an exercise price of $15.00 per each share, are exercisable

for a period of 10 years from the date of the Business Combination, are non-redeemable, and may be exercised on a cashless basis.

Additionally,

$15 Private Warrants and the shares issuable upon the exercise of the $15 Private Warrants were not transferable, assignable, or salable

until after the completion of the Business Combination, subject to certain limited exceptions.

the closing of the IPO, and amount of $80,800,000 ($10.10 per Unit) from the net proceed of the sale of the Units in the IPO and the

sale of Private Placement Securities were placed in a trust account (“Trust Account”) account (“Trust Account”)

and invested in a money market fund, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, meeting the conditions

of Rule 2a-7 of the Investment Company Act, as determined by us, until the earlier of:

(i) the consummation of a Business Combination

or (ii) the distribution of the funds in the Trust Account to the Company’s stockholders, as described below.

On August 4, 2025, FGMC entered into an Agreement and Plan of

Merger, as amended on November 3, 2025, April 6, 2026, and May 6, 2026, with BOXABL Inc.

and FG Merger Sub II Inc.

On July 17, 2026, the parties consummated the transactions contemplated by the Merger Agreement (the “Mergers”),

and FGMC was renamed “BOXABL Inc.” For a full description of the Merger Agreement, the Mergers, the related agreements entered

into in connection with the Closing, and the consideration paid, see Note 1 and Note 8 to the financial statements included elsewhere

in this Quarterly Report.

Related Agreements

Lock-up Agreements

closing, BOXABL and FGMC entered into lock-up agreements with certain BOXABL stockholders (the “Company Lock-Up Agreements”)

and with the sponsor (the “Sponsor Lock-Up Agreement”), restricting the transfer of certain shares for specified periods

following the Closing Date.

Forward Purchase Agreement

On May 28, 2026, the Company entered into an OTC

Equity Prepaid Forward Transaction (the “Forward Purchase Agreement”) with Atsion Opportunity Fund LLC, Series 2 (“Atsion”),

pursuant to which Atsion intended, but was not obligated, to purchase and hold up to 3,000,000 shares of the Company’s common stock

prior to the closing of the Mergers.

Immediately after entry into the Forward Purchase Agreement, the parties entered into a Novation

Agreement dated May 28, 2026, pursuant to which one-half of the Forward Purchase Agreement was novated to FG Capital Partners, LLC (“FGCP”).

On June 11, 2026, Atsion assigned and novated its remaining 50% interest in the Forward Purchase Agreement to Camac Fund, LP, pursuant

to an Assignment and Novation Agreement among Atsion, Camac Fund, LP, FGMC, and BOXABL.

The Forward Purchase Agreement provides that the

seller is to be prepaid an aggregate cash amount equal to the number of shares set forth in a Pricing Date Notice multiplied by the per-share

redemption price payable to redeeming shareholders in connection with the Mergers, funded directly from the Trust Account no later than

the earlier of (a) one business day after the Closing Date or (b) the date any Trust Account assets are otherwise disbursed in connection

with the Mergers.

Following consummation of the business combination, the Forward Purchase Agreement is subject to cash settlement based

principally on the daily volume-weighted average price of the underlying shares during the applicable valuation period, subject to the

contractual settlement amount adjustments and other provisions of the Forward Purchase Agreement.

of Operations

to the consummation of the Mergers, we had neither engaged in any operations nor generated any revenues.

Our only activities

through June 30, 2026 were organizational activities, including those necessary to identifying and working with the target company for

a Business Combination.

During the six months ended June 30, 2026, we generated non-operating income in the form of interest income on

marketable securities.

We incurred expenses primarily related to expenses in connection with completing a Business Combination, as well

as expenses incurred as a result of being a public company (for legal, financial reporting, accounting and auditing compliance).

the three months ended June 30, 2026, the Company reported a net loss of $13,845,985, which consists of $490,166 in investment

income earned in Trust Account, offset by $4,555,829 in general and administrative expenses and $102,935 income tax expense and $9,677,387 expense related to the valuation and change in fair value of the Forward Purchase Agreement.

the six months ended June 30, 2026, the Company reported a net loss of $13,558,223, which consists of $1,212,390 in investment income

earned in Trust Account, offset by $4,829,127 in general and administrative expenses, $264,099 income tax expense and $9,677,387 expense related to the valuation and change in fair value of the Forward Purchase Agreement.

general and administrative expenses include legal and professional fees of $4,709,113 which were primarily related to the

the three months ended June 30, 2025, the Company reported a net income of $582,035 which consists of $842,499 in investment income earned

in Trust Account, offset by $83,539 in general and administrative expenses and $176,925 in income tax expense.

For the six months ended

June 30, 2025, the Company reported a net income of $897,385 which consists of $1,402,254 in investment income earned in Trust Account,

offset by $210,395 in general and administrative expenses and $294,474 in income tax expense.

and Capital Resources

of June 30, 2026, we held a cash balance of $86,887.

Prior to the IPO, our liquidity needs were satisfied through the $25,000 proceeds

received from the Sponsor for purchase of Founder Shares (as defined below), as well as $125,000 loan from Sponsor under a promissory

note (“Promissory Notes”) which was fully repaid on April 1, 2025.

January 28, 2025, we issued an unsecured promissory note of $417,000 to the Sponsor.

This promissory note bore interest at the rate of

12% per year and matured on January 30, 2026.

On March 5, 2025, the company paid $257,000 in principal and $4,935 in interest.

As of March 31, 2025, there was $160,000 outstanding balance in principle and $1,368 in accrued interest under the promissory note.

On January 30, 2025, we consummate our IPO of 8,000,000 Units.

The Units were sold at $10.00 per Unit, generating gross proceeds to the Company of $80,000,000.

Simultaneously with the closing of the IPO, we consummated the Private Placement of Private Units and $15 Private Warrants generating proceeds of $2,483,000 and $100,000 respectively.

From the proceeds of the IPO, Private Placement and the promissory note dated January 28, 2025, the Company put 80,800,000 ($10.10 per Unit) in the Trust and retained approximately $2,200,000 for working capital and payment of expenses related to IPO.

Pursuant to the Investment Management Trust Agreement between the Company and Continental Stock Transfer and Trust (“Trustee”) signed at IPO closing, we are allowed to withdraw up to $1,000,000 annually for working capital need from the investment income earned in the Trust Account.

As of March 31, 2026, we have withdrawn $1,200,000 from the Trust Account.

In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of our officers and directors may, but are not obligated to, loan us funds as may be required (“Working Capital Loans”).

As of March 31, 2026, there were no Working Capital Loans under this arrangement.

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 initial Business Combination

Off-Balance Sheet Arrangement

We have no obligations, assets, or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2026.

Contractual Obligations

Registration Rights

The holders of the Founder Shares, the Private Units, the $15 Private Warrants (and their underlying securities) are entitled to registration rights pursuant to a registration rights agreement.

We will bear the expenses incurred in connection with the filing of any registration statements pursuant to such registration rights.

Underwriting Agreement

We granted the underwriters a 45-day option to purchase up to 1,200,000 additional Units to cover over-allotments at the IPO price.

On February 5, 2025, the underwriters elected to terminate their over-allotment option to purchase 1,200,000 Units resulting in Sponsor forfeiting 300,000 Founder Shares.

The underwriter are entitled to a underwriting discount equal to the lesser of (i) 750,000 (ii) an amount equal to $750,000 plus 1% of the gross proceeds from the sale of the Over-Allotment Units.

1, 2025, the Company paid $160,000 in principal and $1,736 in interest.

As of June 30, 2025, there was no outstanding balance under the

promissory note.

January 30, 2025, we consummated our IPO of 8,000,000 Units.

The Units were sold at $10.00 per Unit, generating gross proceeds to the

Company of $80,000,000.

Simultaneously

with the closing of the IPO, we consummated the Private Placement of Private Units and $15 Private Warrants generating proceeds of $2,483,000

and $100,000 respectively.

the proceeds of the IPO, Private Placement and the promissory note dated January 28, 2025, the Company put 80,800,000 ($10.10 per Unit)

in the Trust and retained approximately $2,200,000 for working capital and payment of expenses related to IPO.

to the Investment Management Trust Agreement between the Company and Continental Stock Transfer and Trust (“Trustee”) signed

at IPO closing, we were allowed to withdraw up to $1,000,000 annually for working capital need from the investment income earned in the

Trust Account.

As of June 30, 2026, we had withdrawn $1,200,000 from the Trust Account.

As of June 30, 2026, the Company reported accounts

payable of $4,441,357.

This primarily represented legal and professional fees incurred as a result of the Mergers and were settled at

the close of the Business Combination.

At the close of the Business Combination, the

Combined Company received gross proceeds of approximately $47.2 million from the FGMC trust account, after giving effect to the

actual redemption of 3,466,086 shares by FGMC’s public stockholders.

Of that amount, approximately $31.1 million was applied

to fund the Combined Company’s prepayment obligations under the Forward Purchase Agreement, as described in Note 8 to the financial statements included elsewhere in this Quarterly Report.

A portion of the remainder was applied

toward transaction costs and other closing obligations, resulting in a net increase of approximately $6.4 million in unrestricted

See Exhibits 99.1 and 99.2 hereto for further detail.

Subsequent to the Closing, the Company received Optional Early Termination payments under the Forward Purchase Agreement

totaling $1,652,170:

$1,182,000 from FGCP (118,200 shares, effective July 20, 2026) and $470,170 from Camac Fund, LP (47,017 shares),

together representing 165,217 Recycled Shares terminated at the then-current $10.00 Reference Price.

Approximately 2,822,985 Recycled

Shares remain outstanding under the Forward Purchase Agreement, which are subject to cash settlement based principally on the daily volume-weighted

average price of the underlying shares during the applicable valuation period, subject to the contractual settlement amount adjustments

and other provisions of the Forward Purchase Agreement.

The Company has not otherwise initiated settlement of the Forward Purchase Agreement

as of the date these financial statements were issued.

Based on the Combined Company’s average monthly cash used in

operating activities of approximately $2.6 million (calculated from operating cash outflow of $15.9 million for the six months ended

June 30, 2026, divided by six months as reported in Exhibit 99.1 hereto), we anticipate that our existing liquidity, together with

the net proceeds received from the Mergers and cash generated from sales of our products, will be sufficient to meet our cash needs

for the next twelve months.

However, our future capital requirements will depend on many factors, including our rate of revenue

growth, the timing and extent of spending on sales and marketing efforts and product development, and the costs of ongoing

compliance and activities following the Mergers.

addressing our long-term liquidity requirements, we consider the next five years, from 2026 through 2030.

We expect that funding for

the Company’s operations over the longer term will be driven primarily from the sales of the Company’s products, as well

as future debt or equity capital raises and proceeds from the OTC Prepaid Forward financing agreements.

financial statements discussed above reflect FGMC’s results as the Company’s predecessor registrant for the period ended

June 30, 2026, and do not include the results of Legacy BOXABL, which was merged into the Company upon the Closing.

BOXABL’s unaudited condensed consolidated financial statements as of and for the six months ended June 30, 2026, filed as

Exhibit 99.1 hereto, disclose that substantial doubt

existed about Legacy BOXABL’s ability to continue as a going concern twelve months after the financial statements are

available to be issued.

As described in Exhibit 99.2, Legacy BOXABL’s management depicts the net proceeds

received in connection with the Mergers, together with existing liquidity and cash generated from product sales.

However, there can

be no assurance management’s plans will be achieved.

Sheet Arrangement

have no obligations, assets, or liabilities, which would be considered off-balance sheet arrangements as of June 30, 2026.

For a discussion of Legacy Boxabl’s

material obligations and commitments that have been assumed by the Company following the Merger and consummation of the Business Combination,

please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Commitments and

Contingencies” in Exhibit 99.2 hereto.

holders of the Founder Shares, the Private Units, the $15 Private Warrants (and their underlying securities) are entitled to registration

rights pursuant to a registration rights agreement.

We filed a registration statement on Form S-3 (File No.

333-297729) on July 27, 2026,

registering for resale up to 3,310,288 shares of Class A common stock held by the selling securityholders named therein, including shares

issuable upon conversion of rights and exercise of the $15 Private Warrants, in satisfaction of such registration rights.

the expenses incurred in connection with the filing of this registration statement pursuant to such registration rights.

granted the underwriters a 45-day option to purchase up to 1,200,000 additional Units to cover over-allotments at the IPO price.

5, 2025, the underwriters elected to terminate their over-allotment option to purchase 1,200,000 Units resulting in Sponsor forfeiting

300,000 Founder Shares.

underwriter is entitled to an underwriting discount equal to the lesser of (i) 750,000 (ii) an amount equal to $750,000 plus 1% of the

gross proceeds from the sale of the Over-Allotment Units.

At IPO closing, the underwriter was paid $750,000.

Underwriters also received 40,000 private units (“Underwriter Units”) at close of IPO for a nominal price of $100.

Additionally, the Underwriter has agreed to defer underwriting commissions equal to 3.5% of the gross proceeds of the IPO (subject to the Company’s right, to allocate up to 50% of such fee to another financial institution in Company’s sole discretion) upon completion of the Business Combination.

Financial Advisor

Upon closing of the IPO, we paid $250,000 to the financial advisor and issued 25,000 private units (the “Advisor Units”).

Related Party Transactions

On October 6, 2023, we issued an aggregate of 2,156,250 shares of common stock (the “Founder Shares”) to the Sponsor for an aggregate purchase price of $25,000 in cash.

On October 18, 2023, the Sponsor transferred an aggregate of 465,000 Founder Shares to members of the Company’s management, board of directors and senior advisors, resulting in the Sponsor holding 1,691,250 Founder Shares.

The Founder Shares include an aggregate of up to 300,000 shares subject to forfeiture by the Sponsor to the extent that the underwriters’ over-allotment is not exercised in full or in part, so that the Initial Stockholders will collectively own 20% of the Company’s issued and outstanding shares after the IPO (assuming the Initial Stockholders did not purchase any Public Shares in the IPO and excluding the securities underlying the $15 Private Warrants, the Private Units).

On August 21, 2024, we issued a dividend of approximately 0.066 Founder Shares for every issued and outstanding founder share resulting in our initial stockholders holding an aggregate of 2,300,000 Founder Shares, an increase of 143,750 founder compared to 2,156,250 initial Founder Shares issued.

On February 5, 2025, the underwriters elected to terminate their over-allotment option to purchase 1,200,000 IPO Units resulting in Sponsor to forfeit 300,000 Founder Shares.

As of March 31, 2026, there were 2,000,000 Founder Shares outstanding.

The Initial Stockholders have agreed not to transfer, assign or sell any of the Founder Shares (except to certain permitted transferees) until, with respect to 50% of the Founder Shares, the earlier of (i) twelve months after the date of the consummation of a Business Combination, or (ii) the date on which the closing price of the Company’s common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after a Business Combination, with respect to the remaining 50% of the Founder Shares, 12 months after the date of the consummation of a Business Combination, or earlier, in each case, if, subsequent to a Business Combination, the Company consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s stockholders having the right to exchange their Public Shares for cash, securities or other property.

Promissory Notes

On October 6, 2023, we issued a promissory note to the Sponsor, pursuant to which we may borrow up to an aggregate principal amount of $150,000.

As of March 31, 2025, $125,000 outstanding under the Promissory Notes.

The Promissory Notes are noninterest bearing and payable on the consummation of the IPO.

On January 28, 2025, we issued an unsecured promissory note of $417,000 to the Sponsor.

This promissory note bear interest at the rate of 12% per year and will mature on January 30, 2026.

On March 5, 2025, the company paid $257,000 in principal and $4,935 in interest.

As of March 31, 2026, there was no balance outstanding under the promissory note.

Administrative Services Agreement

We entered into an administrative services agreement (the “Administrative Services Agreement”) with the Sponsor whereby the Sponsor will perform certain services for us for a monthly fee of $15,000.

As of March 31, 2026, we have paid $45,000 to the Sponsor.

Both executive officers of the Company serve as the managers of the Sponsor at close of the IPO.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States 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 had identified the following as its critical accounting policies:

Basis of presentation

The accompanying financial statements are presented in U.S.

Dollars and conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC.

Emerging growth company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards.

The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.

The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Use of estimates

The preparation of financial statement in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements.

Making estimates requires management to exercise significant judgment.

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 statement, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events.

Accordingly, the actual results could differ significantly from those estimates.

Cash and cash equivalents

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.

The Company did not have any cash equivalents as of March 31, 2026.

Deferred offering costs

Deferred offering costs consist of legal, underwriter expenses, accounting and other offering related expenses incurred through the balance sheet date that are directly related to the IPO and that are charged to stockholders equity upon the completion of the IPO.

Offering cost amounting to 1,481,031 (including $750,000 of underwriting fee and $250,000 of advisor fee) were charged to shareholders’ equity upon the completion of the IPO.

Marketable securities held in trust account

At March 31, 2026, substantially all of the assets held in the Trust Account were invested in a money market fund focused on U.S Treasury obligation.

Common stock subject to possible redemption

The Company accounts for its common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value.

Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity.

At all other times, common stock is classified as stockholders’ equity.

The Company’s common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events.

Accordingly, at March 31, 2026, common stock subject to possible redemption is presented as temporary equity at redemption value, outside of the stockholders’ equity section of the Company’s balance sheet.

The Company recognizes changes in redemption value using the “at redemption value” method and accordingly recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable shares to equal the redemption value at the end of each reporting period.

Such changes are reflected in additional paid-in-capital.

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes.

Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.

Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return.

For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense.

There were no unrecognized tax benefits as of March 31, 2025 and no amounts accrued for interest and penalties.

The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

The Company is subject to income tax examinations by major taxing authorities since inception.

The company’s year-end is December 31 and no statutory tax deadline has yet occurred.

As of March 31, 2026, the Company has estimated $161,164 in income tax expense on the income earned in the Trust Account.

Reconciliation of Net Income (Loss) per Common Share

The Company complies with the accounting and disclosure requirements of ASC 260, Earnings Per Share.

The Company utilize two class methodology in calculation of earnings per share.

The Company has redeemable shares that were issued in IPO and non-redeemable shares which include shares issued in Private Placement, Underwriter Units, Advisor Units and Founder Share (as described below).

Income and losses are shared pro rata between the redeemable and nonredeemable common shares.

Net income (loss) per share of common stock is calculated by dividing the net income (loss) by the weighted average shares of common stock outstanding for the respective period.

Net income for the period from January 1, 2026 to March 31, 2026 was allocated to redeemable and non-redeemable common shares.

Net loss for the period from January 1, 2025 to IPO was allocated fully to the non-redeemable common shares.

Net income from IPO till March 31, 2025, was allocated to redeemable and non-redeemable common shares.

Diluted net income per share attributable to stockholders adjusts the basic net income per share attributable to stockholders and the weighted-average shares of common share outstanding for the potentially dilutive impact of outstanding warrants.

Fair value of financial instruments

The fair value of the Company’s assets and liabilities which qualify as financial instruments under ASC Topic 820, “Fair Value Measurement”, approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.

The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date.

In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities).

The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities.

Quoted prices in active markets for identical assets or liabilities.

An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Observable inputs other than Level 1 inputs.

Examples of Level 2 input include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.

Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.

The fair value of the marketable securities held in Trust Account is determined using the level 1 input.

Operating Segments

ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers.

Operating segments are defined as components of an enterprise that engage in business activities from which it may recognize revenues and incur expenses, and for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance.

The Company’s chief operating decision maker (“CODM”) has been identified as the Chief Executive Officer and the Chief Financial Officer, who reviews the assets, operating results, and financial metrics for the Company as a whole to make decisions about allocating resources and assessing financial performance.

Accordingly, management has determined that there is only one reportable segment.

The CODM assesses performance for the single segment and decides how to allocate resources based on net income or loss that also is reported on the statement of operations as net income or loss.

The measure of segment assets is reported on the balance sheet as total assets.

When evaluating the Company’s performance and making key decisions regarding resource allocation, the CODM reviews several key metrics included in net income or loss and total assets, which include the following:

March 31, 2026

March 31, 2025

General and administrative expenses

Interest earned in the Trust Account

The CODM reviews interest earned on the Trust Account to measure and monitor stockholder value and determine the most effective strategy of investment with the Trust Account funds while maintaining compliance with the Trust Agreement.

General and administrative expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a business combination or similar transaction within the business combination period.

The CODM also reviews general and administrative costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.

General and administrative costs, as reported on the statement of operations, are the significant segment expenses provided to the CODM on a regular basis.

All other segment items included in net income or loss are reported on the statement of operations and described within their respective disclosures.

Recently issued accounting standard

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

ASU 2023-07, which is applicable to entities with a single reportable segment, will primarily require enhanced disclosures about significant segment expenses and enhanced disclosures in interim periods.

The guidance in ASU 2023-07 will be applied retrospectively and is effective for annual reporting periods in fiscal years beginning after December 15, 2023, and interim reporting periods in fiscal years beginning after December 31, 2024, with early adoption permitted.

The Company adopted this guidance for the year ended 2025.

The adoption resulted in disclosure changes only.

In December 2023, the Financial Accounting Standards Board issued ASU 2023-09, which requires enhanced disclosures related to the effective tax rate reconciliation and income taxes paid.

The guidance is intended to improve transparency regarding the nature and magnitude of factors contributing to differences between the statutory tax rate and the effective tax rate, as well as cash taxes paid by jurisdiction.

The Company adopted this standard effective January 1, 2025 on a prospective basis.

The adoption did not have a material impact on the Company’s consolidated financial position, results of operations, or cash flows, as the amendments are disclosure-only in nature.

Prior-period amounts have been recast to conform to the current-period presentation, where applicable.

The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

Underwriter also received 40,000 private units (“Underwriter Units”) at close of IPO for a nominal price of $100 The

Underwriter Units are subject to registration rights under the Registration Rights Agreement, to which ThinkEquity LLC is a

Additionally, the Underwriter has agreed to defer underwriting commissions equal to 3.5% of the gross proceeds of the IPO

(subject to the Company’s right, to allocate up to 50% of such fee to another financial institution in Company’s sole

discretion) until completion of the Mergers.

The Mergers closed July 17, 2026 and ThinkEquity was paid $5,900,381 in aggregate

transaction costs at Closing to settle this obligation.

closing of the IPO, we paid $250,000 to our financial advisor and issued 25,000 private units (the “Advisor Units”).

Advisor Units are subject to registration rights and are included in the S-3 (File No.

the financial advisor

(EarlyBirdCapital, Inc.) and its affiliated designees are named as selling security holders therein.

Relations Consultant

August 5, 2025, BOXABL Inc.

entered into an investor relations consulting agreement with MZHCI, LLC.

Pursuant to that agreement, Boxabl

became obligated to issue Class A common stock to MZHCI, LLC following completion of the Mergers.

On August 13, 2026, Boxabl issued

31,579 shares of Class A common stock to MZHCI, LLC.

Party Transactions

Company’s related party transactions, including the Founder Shares held by the Sponsor and other Initial Stockholders, the related

lock-up provisions, the Promissory Notes issued to and repaid to the Sponsor, the Administrative Services Agreement (terminated in connection

with the Closing), the Forward Purchase Agreement and related Novation Agreement with FG Capital Partners, and the Class B

Common Stock held by Paolo Tiramani and Galiano Tiramani following the Business Combination, are described in Note 5 to the financial

statements included elsewhere in this Quarterly Report.

Accounting Policies

preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the

reported amounts of assets, liabilities, revenues, and expenses.

We evaluate our estimates and assumptions on an ongoing basis.

Our estimates

are based on historical experience and various other assumptions that we believe are reasonable, and actual results could differ from

those estimates.

We consider an accounting estimate to be critical if it requires us to make particularly difficult, subjective, or complex

judgments about matters that are inherently uncertain, and if different estimates that we reasonably could have used, or changes in the

accounting estimate that are reasonably likely to occur, would have a material effect on our financial condition or results of operations.

A description of our other significant

accounting policies, including those discussed below, can be found in Note 2 to the financial statements included elsewhere in this Quarterly

Based on this definition, we have identified the following as our critical accounting estimates.

Stock Subject to Possible Redemption

classify our common stock subject to possible redemption as temporary equity, at redemption value, based on management’s judgment

that the redemption feature is conditioned on the occurrence of uncertain future events not solely within the Company’s control.

This judgment determines whether the underlying shares are presented within temporary equity, as a liability, or within permanent stockholders’

equity, and a different conclusion regarding the Company’s control over redemption would have resulted in a materially different

balance sheet presentation.

In addition, once classified as temporary equity, the carrying value of the redeemable shares is remeasured

each period to equal their redemption value, which is directly determined by the balance of the Trust Account.

Because the Trust Account

balance fluctuates with investment income earned, and (through the Closing Date) was itself sensitive to the level of stockholder redemptions,

this remeasurement is a significant estimate that materially affects both temporary equity and, once additional paid-in capital is exhausted,

accumulated deficit, in each reporting period presented.

are required to estimate our income tax expense on income earned within the Trust Account for each reporting period.

This estimate requires

judgment in applying the applicable federal statutory tax rate to trust investment income and in assessing whether any deferred tax assets

or unrecognized tax benefits should be recorded.

As of June 30, 2026, we estimated $264,099 of income tax expense on income earned in

the Trust Account for the six months then ended.

Because this estimate is based on trust investment income that is itself variable and

depends on market conditions, a different assumption regarding the applicable rate or the character of trust earnings could result in

a materially different income tax expense than currently estimated.

Purchase Agreement

The Forward Purchase Agreement is a Level 3 derivative

measured at fair value each period under ASC 815.

The valuation requires significant judgment because it relies on unobservable inputs,

the probability of consummation of the Business Combination, the expected closing date, the expected post-closing share price, projected

volatility, and the risk-free rate, and because the instrument settles based on the volume-weighted average trading price of our common

stock during the applicable valuation period.

Reasonable changes in these inputs, particularly projected volatility or the expected post-closing

share price, could result in a materially different fair value.

Since inception on May 28, 2026, the recorded liability increased from

approximately $8.6 million to approximately $9.7 million as of June 30, 2026, an increase of approximately $1.1 million, reflecting the

change in fair value recognized in earnings during the period, as described in Note 2.

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.

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.

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