Columbus Acquisition Corp/Cayman Islands 10-K

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. References to the “Company,” “CAC,” “us,” “our,” or “we” refer to Columbus Acquisition Corp. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and related notes herein. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related thereto which are included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Special Note Regarding Forward-Looking Statements,” “Item 1A. Risk Factors” and elsewhere in this Annual Report on Form 10-K. Overview We are a blank check company formed under the laws of Cayman Island on January 18, 2024, for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities. We intend to effectuate our business combination using cash derived from the proceeds of the IPO, our securities, debt or a combination of cash, securities and debt, in effecting a business combination. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location but will initially focus on Asia. We have not selected any target business for our initial business combination. We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to raise capital or to complete our initial business combination will be successful. Initial Public Offering and Private Placement On January 24, 2025, the Company consummated its IPO of 6,000,000 Units. Each Unit consists of one ordinary shares and one Right to receive one-seventh of one ordinary share upon the completion of the initial business combination. The Units were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $60,000,000. Substantially concurrently with the closing of the IPO, the Company completed the private sale of 234,290 Private Units to the Sponsor. Each Private Unit consists of one Ordinary Share and one Right. The Private Units were sold at a purchase price of $10.00 per Private Unit, generating gross proceeds to the Company of $2,342,900. The proceeds of $60,000,000 ($10.00 per Unit) in the aggregate from the IPO and the Private Placement were placed in the Trust Account with Continental Stock Transfer & Trust Company acting as trustee. On March 10, 2025, the Sponsor forfeited 225,000 Founder Shares (as defined below) for no consideration as the underwriters of the IPO did not exercise the over-allotment option. As a result, the Sponsor currently holds 1,698,290 Ordinary Shares in total, including 1,464,000 Founder Shares and 234,290 Ordinary Shares included in the Private Units. Our management has broad discretion with respect to the specific application of the proceeds of the IPO and the Private Placement that are held outside of the Trust Account, although substantially all the net proceeds are intended to be applied generally towards consummating a business combination and working capital. 12 Proposed Transactions On November 9, 2025, the Company entered into a business combination agreement (as it may be amended, supplemented, or otherwise modified from time to time, the “BCA”) with WISeSat.Space Holdings Corp., a British Virgin Islands business company (“Pubco”), WISeSat Merger Sub Corp., a Cayman Islands exempted company and a wholly owned subsidiary of Pubco (“Merger Sub”), WISeSat.Space Corp., a British Virgin Islands business company (the “Target”), and WISeKey International Holding Ltd., a Swiss company (together with its successors, including after its anticipated domestication to the British Virgin Islands prior to the Closing, the “Seller”). Pursuant to the BCA, subject to the terms and conditions set forth therein, upon the closing of the transactions contemplated by the BCA (the “Closing”), CAC will become a wholly owned subsidiary of Pubco; and each issued and outstanding CAC Security (as defined in the BCA) immediately prior to the effective time of the Merger (as defined in the BCA) shall no longer be outstanding and shall automatically be cancelled, in exchange for the right of the holder thereof to receive Pubco Ordinary Shares. Following the Merger, the Seller may distribute up to 10% of its Pubco shares to its own shareholders at its discretion. The transactions contemplated by the BCA and the Ancillary Documents are referred to herein as the “Transactions.” The Transactions will be submitted to shareholders of the Company for approval at an extraordinary general meeting. Pubco, together with the Company, will file with the Securities and Exchange Commission (the “SEC”) a proxy statement/prospectus on Form F-4 (the “Business Combination Proxy Statement”) in connection with the proposed Transactions. On December 29, 2025, CAC and WISeKey International Holding AG jointly announced the confidential submission of a draft of the Business Combination Proxy Statement by Pubco with the SEC on December 23, 2025. Pursuant to the Company’s Charter, the Company currently has until January 22, 2027 to complete the Transactions, if fully extended. Share Exchange Consideration Immediately prior to the Effective Time, in full payment for the Company Shares, Pubco shall issue and deliver to the Seller the Exchange Shares with an aggregate value (the “Exchange Consideration”) equal to the sum of (i) Two Hundred Fifty Million U.S. Dollars ($250,000,000), plus (ii) the amount of any Transaction Financing (as defined in the BCA) that is made into the Company or its Subsidiaries prior to the Closing, with each Pubco Ordinary Share valued at Ten U.S. Dollars ($10.00). The Exchange Shares will be allocated between Pubco Ordinary Shares and Pubco Class F Shares in proportion to the number of Company Ordinary Shares and Company Class F Shares owned by Seller at the time of the Share Exchange. The Pubco Class F Shares shall, in the aggregate, be entitled to 49.9% of the total vote on any matter voted on by the holders of Pubco Shares, and the Pubco Class F Shares will automatically convert into Pubco Ordinary Shares upon certain transfers in accordance with the Company Organizational Documents. Treatment of CAC Securities; Merger Consideration Pursuant to the BCA, (a) immediately prior to the Effective Time, every issued and outstanding CAC Unit shall be automatically detached, and the holder thereof shall be deemed to hold one CAC Ordinary Share and one CAC Right in accordance with the terms of the applicable CAC Unit (the “Unit Separation”); (b) immediately prior to the Effective Time and immediately following the Unit Separation, each issued and outstanding CAC Right (including the CAC Rights held as a result of the Unit Separation) shall be automatically converted into one-seventh of one CAC Ordinary Share; (c) at the Effective Time, every issued and outstanding CAC Ordinary Share (including each CAC Ordinary Share converted from CAC Rights pursuant to (b) above and each CAC Ordinary Share held as a result of the Unit Separation, other than the Excluded Shares, the Dissenting Shares and the Redeemed Shares (each as defined in the BCA)) shall become and be converted automatically into the right to receive one Pubco Ordinary Share, following which, all CAC Ordinary Shares shall cease to be outstanding and shall automatically be canceled and shall cease to exist. 13 At the Effective Time, by virtue of the Merger, all Merger Sub Ordinary Shares issued and outstanding immediately prior to the Effective Time shall be converted into an equal number ordinary shares of the Surviving Company, with the same rights, powers and privileges as the shares so converted and shall constitute the only outstanding issued shares of the Surviving Company. In connection with the execution of the BCA, the relevant parties entered into the Sponsor Agreement the Insider Letter Amendment and Lock-up Agreement accordingly. January 2026 Extension Meeting On January 16, 2026, the Company held an extraordinary general meeting of shareholders (the “Extraordinary General Meeting”), where the shareholders of the Company approved the proposal (the “Charter Amendment Proposal”) that the Company’s Amended and Restated Memorandum and Articles of Association, which provided that the Company has until January 22, 2026 to complete a business combination, be deleted in their entirety and the substitution in their place of the Second Amended and Restated Memorandum and Articles of Association (the “Amended Charter”) to provide that the Company has until January 22, 2026 to complete a business combination, and may elect to extend the period to consummate a business combination up to twelve times, each by an additional one-month extension (the “Monthly Extension”), for a total of up to twelve months to January 22, 2027. In order to effectuate each Monthly Extensions, $50,000 needs to be deposited into the Trust Account of the Company (the “Monthly Extension Fee”). On January 16, 2026, the Company and the Trustee entered into the amendment to the Investment Management Trust Agreement dated January 22, 2025 ( as amended, the “Trust Agreement”) upon the shareholders’ approval at the Extraordinary General Meeting, which provides that that the Trustee must commence liquidation of the Trust Account by the prescribed timeline as provided in the Company’s Amended Charter. In connection with the votes to approve the Charter Amendment Proposal, 3,449,851 Ordinary Shares of the Company were rendered for redemption, and approximately $35.82 million was released from the Trust Account to pay such redeeming shareholders. Extensions As of the date of this Annual Report, the Company has until March 22, 2026 to complete its initial business combination (or up to January 22, 2027 if fully extended). A total of $100,000 Monthly Extension Fees were deposited into the Trust Account of the Company, among which $50,000 were paid by the Company from its working capital and $50,000 were paid by the Target pursuant to the BCA. 14 Results of Operations and Known Trends or Future Events We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities and those necessary to prepare for the IPO. Following the IPO, we have not generated, and do not expect to 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 IPO. 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. After the IPO, we incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for expenses associated with the search for target opportunities. For the year ended December 31, 2025, we had a net income of $1,285,090, which consisted of interest income from the Trust Account of $2,231,602 offset by general and administrative expenses of $946,512. Changes in operating assets and liabilities provided $302,102 of cash for operating activities. For the period from January 18, 2024 (inception) through December 31, 2024, we had a net loss of $77,094, all of which consisted of formation and operating costs. Liquidity and Capital Resources As of December 31, 2025, we had $483,756 in cash and a working capital of $179,238.We intend to use substantially all of the net proceeds of the IPO, including the funds held in the Trust Account, to acquire a target business or businesses and to pay our expenses relating thereto. To the extent that our share capital is used in whole or in part as consideration to effect our initial business combination, the remaining proceeds held in the Trust Account as well as any other net proceeds not expended will be used as working capital to finance the operations of the target business. Such working capital funds could be used in a variety of ways including continuing or expanding the target business’ operations, for strategic acquisitions and for marketing, research and development of existing or new products. Such funds could also be used to repay any operating expenses or finders’ fees which we had incurred prior to the completion of our initial business combination if the funds available to us outside of the Trust Account were insufficient to cover such expenses. We have incurred and expect to continue to incur significant professional costs to remain as a publicly traded company and to incur significant transaction costs in pursuit of its financing and acquisition plans. The Company currently has no commitments to receive such financing and there is no assurance that the Company’s plans to raise capital will be successful. In addition, the Company has until March 22, 2026 to complete its initial business combination (or up to January 22, 2027 if fully extended) to consummate the initial Business Combination. If the Company does not complete a Business Combination within the Combination Period, the Company will trigger an automatic winding up, dissolution and liquidation pursuant to the terms of the amended and restated memorandum and articles of association. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standards Board’s Accounting Standards “Codification Subtopic 205-40, Presentation of Financial Statements - Going Concern”, management has determined that the mandatory liquidation, should a Business Combination not occur, and potential subsequent dissolution, along with the need to receive additional financing, raise substantial doubt about the Company’s ability to continue as a going concern until the earlier of the consummation of the Business Combination or the date the Company is required to liquidate. The audited consolidated financial statements do not include any adjustments that might result from the Company’s inability to continue as a going concern. 15 Off-Balance Sheet Financing Arrangements We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of December 31, 2025. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets. Contractual Obligations As of December 31, 2025, we do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities. The Founder Shares, the ordinary shares included in the Private Units, and any Ordinary shares that may be issued upon conversion of Working Capital Loans (and any underlying securities) will be entitled to registration rights pursuant to a registration and shareholder rights agreement entered into in connection with the IPO. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our completion of our initial business combination. We will bear the expenses incurred in connection with the filing of any such registration statements. Critical Accounting Estimates In preparing these financial statements in conformity with US GAAP, management makes 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 and the reported expenses during the reporting period. 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 statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, actual results may differ from these estimates. We have not identified any critical accounting estimates. Recent Accounting Standards Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our financial statements. 16