Columbus Acquisition Corp/Cayman Islands 10-Q

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Forward-Looking Statements This Quarterly Report on Form 10-Q includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other Securities and Exchange Commission (“SEC”) filings. References to the “Company”, “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 unaudited financial statements and related notes herein. Overview We are a blank check exempted company incorporated in the Cayman Islands on January 18, 2024, for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location. We intend to utilize cash derived from the proceeds of our initial public offering (the “IPO”), our securities, debt or a combination of cash, securities and debt, in effecting a business combination. We have not selected any target business for our initial business combination. Initial Public Offering On January 24, 2025, we consummated our IPO of 6,000,000 units (“Units”). Each Unit consists of one ordinary share, $0.0001 par value per share (the “Ordinary Share”), and one right (the “Rights”) 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. On January 24, 2025, substantially concurrently with the closing of the IPO, we completed the private sale (the “Private Placement”) of 234,290 units (the “Private Units”) to our sponsor, Hercules Capital Management VII Corp (the “Sponsor”), at a purchase price of $10.00 per Initial Private Unit, generating gross proceeds to us of $2,342,900. In connection with the offering of the Units and the sale of Initial Private Units, the proceeds of $60,000,000 from the proceeds of the offering of the Units and the sale of Initial Private Units were placed in the Trust Account (as defined below). In connection with the IPO, the Company issued a total of 210,000 Ordinary shares (the “Representative Shares”) to A.G.P./Alliance Global Partners, the representative of the underwriters of the IPO. The Representative Shares are identical to the Ordinary Shares included in the Units, except that the Representative has agreed not to transfer, assign, sell, pledge, or hypothecate any such Representative Shares, or subject such Representative Shares to hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person until 180 days immediately following the commencement of sales of the IPO pursuant to FINRA Rule 5110(e)(1), subject to exceptions pursuant to FINRA Rule 5110(e)(2). The Representative has agreed to (i) vote for at a shareholder meeting of the Company to approve a business combination or any amendment to the Company’s amended and restated memorandum and articles of association to modify the substance or timing of the Company’s obligation to allow redemptions in connection with a business combination, (ii) waive the redemption rights until the completion of the business combination, in connection with the completion of the Company’s initial business combination or a shareholder vote to approve an amendment to the Company’s amended and restated memorandum and articles of association to modify the substance or timing of our obligation to allow redemptions in connection with a business combination, and (iii) waive the rights to liquidating distributions from the Trust Account with respect to the Representative Shares if the Company fails to complete its initial business combination within the prescribed timeline as provided in the Company’s amended and restated memorandum and articles of association, to the extent such Representative Shares held by the Representative and/or its designees, and any of their permitted transferees. 20 The proceeds of $60,000,000 from the IPO and the sales of Private Units, were placed in a trust account (the “Trust Account”) established for the benefit of our public shareholders and the underwriters of the IPO with Continental Stock Transfer & Trust Company acting as trustee. 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. Since our IPO, our sole business activity has been identifying and evaluating suitable acquisition transaction candidates. We presently have no revenue and have had losses since inception from incurring general and administrative expenses. We have relied upon the sale of our securities and loans from the Sponsor to fund our operations. On March 17, 2025, the Ordinary Shares and Rights commenced trading on the Nasdaq Global Market (“Nasdaq”) under the symbols “COLA” and “COLAR,” respectively. Public Units not separated continue to trade on Nasdaq under the symbol “COLAU.” Holders of Public Units will need to have their brokers contact the Company’s transfer agent, Continental Stock Transfer & Trust Company, in order to separate the holders’ Public Units into Ordinary Shares and Rights. 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. 21 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. 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. Sponsor Agreement Simultaneously with the execution and delivery of the BCA, CAC, the Target, Pubco and the Sponsor entered into a sponsor agreement (the “Sponsor Agreement”). Pursuant to the Sponsor Agreement, on the terms and subject to the conditions set forth therein, the Sponsor agreed, among other things, (a) to vote in favor of the BCA and the Transactions and against any alternative transaction; (b) during the term of the Sponsor Agreement, not to transfer and to cause its affiliates not to transfer any of the Sponsor Shares (as defined therein) except as permitted thereby; (c) during the term of the Sponsor Agreement, not to redeem any Sponsor Shares (as defined therein) and convert all CAC rights held by it into the underlying CAC Ordinary Shares; (d) to pay for CAC Expenses (as defined in the BCA) in excess of the CAC Expense Cap (as defined in the BCA); (e) to take timely actions to extend CAC’s deadline to complete the Business Combination as necessary to consummate the Closing; and (f) that any working capital loans made to CAC (including for any Extension Payments) will at the Closing be either, as requested by the Target, repaid in cash or converted into CAC Working Capital Units in accordance with the IPO Prospectus (excluding after CAC has fully utilized its existing working capital as of the Signing Date, up to $400,000 in working capital loans made prior to the Closing to CAC by third parties (excluding the Target) or members of the Sponsor, in either case, that are not affiliates of CAC, the Sponsor or CAC’s management or directors, even if such loans are indirectly made through the Sponsor, as to which the repayment terms will be as provided as disclosed in the IPO Prospectus). The Sponsor Agreement will terminate on the earliest of (i) the mutual written consent of CAC, the Target and Sponsor, (ii) the Closing of the Transactions, or (iii) the termination of the BCA in accordance with its terms. Insider Letter Amendment Simultaneously with the execution and delivery of the BCA, CAC, Pubco, the Sponsor, the Target and CAC’s directors and officers entered into an amendment (the “Insider Letter Amendment”) to the letter agreement that was entered into by and among CAC, the Sponsor and certain other member of CAC’s board of directors and/or management team on January 22, 2025 (the “Insider Letter”). Pursuant to the Insider Letter Amendment, the parties amended the letter agreement to (a) give the Target and Pubco rights to enforce the terms of the Insider Letter; (b) effective as of the Closing, assign the rights and obligations of CAC under the Insider Letter to Pubco; and (c) provide that the lock-up period applicable to the Pubco Ordinary Shares issued in exchange for the Founder Shares (as defined in the BCA) pursuant to the BCA will be identical to the lock-up period set forth in the Lock-Up Agreement (as defined below). Lock-up Agreement Simultaneously with the execution and delivery of the BCA, CAC, Pubco and the Seller entered into a lock-up agreement (the “Lock-up Agreement”), which, among other things, provides for certain restrictions on the transfer of certain Pubco Ordinary Shares by the Seller and other holders who become Pubco’s shareholders as a result of the Seller Distribution following the Closing, as further described below and subject to the terms and conditions set forth in the Lock-up Agreement. Pursuant to the Lock-up Agreement, from and after the Closing, the Seller and other holders who become Pubco shareholders as a result of the Seller Distribution shall not Transfer (as defined in the Lock-up Agreement) any of the Restricted Securities (as defined in the Lock-up Agreement) until the earlier of: (a) the six month anniversary of the date of the Closing; (b) the date (but not less than 60 days after the Closing) on which the closing price of the Pubco Ordinary Shares exceeds $12.50 for any 20 trading days within a 30-day trading period following the Closing; and (c) the date after the Closing on which Pubco consummates a liquidation, merger, share exchange, reorganization or other similar transaction with an unaffiliated third party that results in all of Pubco’s shareholders having the right to exchange their equity holdings in Pubco for cash, securities or other property. 22 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 $35.83 million was released from the Trust Account to pay such redeeming shareholders. Extensions and Extension Notes As of the date hereof, the Company has until May 22, 2026 to complete its initial business combination (or up to January 22, 2027 if fully extended). A total of $200,000 Monthly Extension Fee was deposited into the Trust Account of the Company, among which $100,000 was paid by the Company from its working capital and $100,000 was paid by the Target pursuant to the BCA. On May 5, 2026, the Company issued an unsecured promissory note in the aggregate principal amount of $100,000 to the Target in connection with the Target’s payment of an aggregate of $100,000 of the Monthly Extension Fee (the “Target Extension Note”) through four deposits of $25,000, representing 50% of the Monthly Extension Fee per deposit pursuant to the BCA. The Target Extension Note bears no interest and is payable in full upon the earliest to occur of (i) the termination date of the Business Combination Agreement in accordance with its terms other than by the Company pursuant to Section 10.1(e) thereof, (ii) the date on which the Company consummates its initial business combination, including the proposed business combination with the Target (a “Business Combination”), and (iii) the date that the winding up of the Company is effective (such earlier date, the “Maturity Date”). The payee of the Target Extension Note, the Target or its registered assigns or successors in interest (the “Payee”), has the right, but not the obligation, to convert the outstanding unpaid obligations payable to the Payee under the Target Extension Note, in whole or in part, respectively, into private units (the “Conversion Units”) of the Company at a price of $10.00 per unit, each consisting of one ordinary share, par value $0.0001 per share (the “Ordinary Share”) and one right to receive one-seventh (1/7) of one Ordinary Share upon the consummation of a Business Combination, as described in the prospectus of the Company (File No: 333-283278). Notwithstanding the foregoing, in the event of a valid termination of the Business Combination Agreement by the Company pursuant to Section 10.1(e) thereof, upon the completion of a Business Combination of the Company with other targets, other than the Target or its affiliate, the Payee, at its sole election, may choose (i) either repayment of the outstanding amount under the Target Extension Note, or (ii) to convert the outstanding amount into common or ordinary shares of the post-closing public company in such Business Combination (“Conversion Shares”) at a price per share equal to $5.00 (with such price to be equitably adjusted if the Ordinary Shares, par value are subject to any share splits, share dividends, combinations, recapitalizations and the like after the date of such Target Extension Note or are not converted into common or ordinary shares of the post-closing public company in such Business Combination on a one-for-one basis). 23 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 as well as activities related to the IPO. Following the IPO, we will not generate any operating revenues until after the completion of a business combination, at the earliest. We will generate non-operating income in the form of dividend and/or interest income from the proceeds derived from the IPO and sale of Private Units. Since the completion of the IPO, we 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 expenses associated with the search for target opportunities. For the three months ended March 31, 2026, we had a net income of $61,472, which consisted of interest income from the Trust Account of $287,400, partially offset by general and administrative expenses of $ 225,928. For the three months ended March 31, 2025, we had a net income of $149,799, which consisted of interest income from the Trust Account of $403,733, partially offset by general and administrative expenses of $253,934. Liquidity and Capital Resources As of March 31, 2026, we had cash of $129,350 and a working capital deficit of $196,690. The cash balance was decreased by $354,406 for the three months ended March 31, 2026, which consisted of cash used by financing activities of $35,757,096, partially offset by cash provided by investing activities of $35,682,096 and cash used by operating activities of $279,406. Changes in operating assets and liabilities provided $53,478 of cash for operating activities. 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 affect 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. 24 Over the next 12 months (assuming a business combination is not consummated prior thereto), we will be using the funds held outside of the Trust Account for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the business combination. If our estimates of the costs of undertaking in-depth due diligence and negotiating our 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. Moreover, we may need to obtain additional financing either to consummate our initial business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our initial business combination, in which case we may issue additional securities or incur debt in connection with such a business combination. Subject to compliance with applicable securities laws, we would only consummate such financing simultaneously with the consummation of our initial business combination. Following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. We have incurred and expect to continue to incur significant costs to remain as a publicly traded company and to incur significant transaction costs in pursuit of the consummation of a Business Combination. 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. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our public shares upon completion of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination. The Company currently has no commitments in place to receive such financing and there is no assurance that the Company’s plans to raise capital will be successful. In addition, the Company currently has until January 22, 2027 (if fully extended) to consummate the initial business combination (assume no extensions). If the Company does not complete a business combination within the prescribed 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. Notwithstanding management’s belief that the Company would have sufficient funds to execute its business strategy, there is a possibility that a business combination might not be completed within the 12-month period from the issuance date of these financial statements. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard 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, raises substantial doubt about the Company’s ability to continue as a going concern. Therefore, management has determined that such additional conditions 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 financial statements do not include any adjustments that might result from the Company’s inability to continue as a going concern. Off-Balance Sheet Financing Arrangements We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of March 31, 2026. 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. 25 Contractual Obligations As of March 31, 2026, 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 extension 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 unaudited condensed financial statements in conformity with U.S. 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 Pronouncements Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our financial statements. Item 3. Quantitative and Qualitative Disclosures about Market Risk As a smaller reporting company, we are not required to make disclosures under this Item.