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Item 9A. Controls and Procedures

2025-11-06 compared with 2024-04-08 · 2196 added, 1691 removed, 52 unchanged (99% of the section changed)

CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the

time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions,

as appropriate to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our principal executive officer and principal financial officer, we

conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal period ended December 31, 2023, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.

Based on this

evaluation, our principal executive officer and principal financial officer concluded that during the period covered by this report, our disclosure controls and procedures were not effective due to the inadequate controls around account

reconciliations and controls for the withdrawal of funds from the Trust Account.

A material weakness, as defined in the SEC regulations, is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that

there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

In light of this material weaknesses, we performed additional analysis

as deemed necessary to ensure that our financial statements were prepared in accordance with U.S.

generally accepted accounting principles.

Management plans to remediate the material weakness by enhancing our control process around the withdrawals of funds from

the Trust Account.

The elements of our remediation plan can only be accomplished over time, and these initiatives may not ultimately have the intended effects.

Management’s Report on Internal Controls Over Financial Reporting

As required by SEC rules and regulations implementing Section 404 of the Sarbanes-Oxley Act, our management is responsible for establishing and maintaining adequate internal control over

financial reporting.

Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external reporting purposes in

accordance with GAAP.

Our internal control over financial reporting includes those policies and procedures that:

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with

authorizations of our management and directors, and

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect errors or misstatements in our financial statements.

Also, projections of any evaluation

of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate.

Management assessed the

effectiveness of our internal control over financial reporting at December 31, 2023.

In making these assessments, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal

Control — Integrated Framework (2013).

Based on our assessments and those criteria, management determined that we did not maintained effective internal control over financial reporting as of December 31, 2023.

This Report does not include an attestation report of our independent registered public accounting firm due to our status as an emerging growth company under the JOBS Act.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our

internal control over financial reporting.

Disclosure Controls and Procedures

Management’s evaluation of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act was performed under the

supervision and participation of our management, including our Chief Executive Officer and Chief Financial Officer.

The purpose of disclosure controls and procedures is to ensure that information required to be disclosed in the reports

filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our

Interim Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures.

Changes in Internal Controls over Financial Reporting

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has concluded that there were no significant changes in our internal controls over

financial reporting that occurred during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and internal controls will prevent all errors and all fraud.

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

Further, the design of a control system must reflect the fact that there

are resource constraints, and the benefits of controls must be considered relative to their costs.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues

and instances of fraud, if any, within the Company have been detected.

These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake.

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management or board override of the control.

The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in

achieving its stated goals under all potential future conditions;

over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

Because of the

inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Management’s Report on Internal Control over Financial Reporting

Based on an evaluation as of July 31, 2025, our management, including the Chief Executive Officer and Chief Financial Officer, has concluded that our disclosure controls and procedures (as

defined in Rule 13a-15(e) under the Exchange Act) were not effective to provide reasonable assurance because of a material weakness in our internal control over financial reporting as described below.

Material Weakness

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement

of our annual or interim financial statements will not be prevented or detected in a timely manner.

We did not design or maintain an effective control environment commensurate with financial reporting requirements.

Specifically, we did not consistently have documented evidence of review

procedures and, due to resource limitations, did not always maintain segregation of duties between preparing and reviewing analyses, and reconciliations.

The above material weakness did not result in a material misstatement of our consolidated financial statements, however, it could result in a misstatement of our account balances or

disclosures that would result in a material misstatement that would not be prevented or detected.

Remediation Activities

We are working to remediate the material weakness and are taking steps to strengthen our internal control over financial reporting through the continued hiring of additional appropriately

skilled finance and accounting personnel with the requisite technical knowledge and skills.

With the additional skilled personnel, we are taking appropriate and reasonable steps to remediate this material weakness through the implementation

of appropriate segregation of duties, formalization of accounting policies and controls and retention of appropriate expertise for complex accounting transactions.

We will not be able to fully remediate these control deficiencies until

these steps have been completed and have been operating effectively for a sufficient period of time.

Management will continue to review and make necessary changes to the overall design of our internal control environment, as well as

policies and procedures to improve the overall effectiveness of internal control over financial reporting.

The material weakness will not be considered remediated, however, until the applicable controls operate for a sufficient period of

time and management has concluded that these controls are operating effectively.

OTHER INFORMATION.

During the year ended December 31, 2023, none of our directors or executive

officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as such term is

defined in Item 408(a) of Regulation S-K.

DISCLOSURE REGARDING FOREIGN JURISDICTION THAT PREVENT INSPECTIONS

During the year ended July 31, 2025, no director or Section 16 officer adopted or terminated any Rule 10b5-1 plan or non-Rule 10b5-1 trading arrangements.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.

Not Applicable.

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE.

Officers and Directors

Our officers and directors are as follows:

Chief Executive Officer and Director

Chief Financial Officer

Chief Investment Officer

Howard Sanders

Lead Director

Dawanna Williams

Stanton, Chief Executive Officer and Director .

Carl is a Partner and Co-Founder of Focus Impact Partners, LLC and currently serves as our Chief

Executive Officer and director and as the Chief Executive Officer and a director of Focus Impact BH3 Acquisition Company, a special purpose acquisition corporation (Nasdaq:

Carl brings nearly three decades of experience in leading

companies across transformative Private Equity/Alternative Asset management with a proven track record in creating shareholder value.

Carl has unique knowledge and skills across all facets of Asset Management.

He is a team builder and has managed

and co-led two Alternative Asset Management firms totaling over $4.5 billion AUM, and has delivered best-in-class investment performance results along with colleagues over multiple funds.

He has advised CEOs, CFOs, and boards of directors of

multiple companies and spread managerial, financial, and strategic best practices with demonstrated expertise in value creation strategies including revenue growth strategies, industry transformation, cost control, supply chain management, and

technology best practices.

Carl has also served as Board Member to more than 15 portfolio companies across Industrial Products & Services, Transportation & Logistics and Consumer industries;

including his current role as a Board Member of

Skipper Pets, Inc.

Carl is former Managing Partner and Head of Private Equity for Invesco Private Capital, a division of Invesco, Ltd.

IVZ), which managed private investment vehicles across private equity,

venture capital, and real estate.

At Invesco Private Capital, Carl was responsible for overseeing multiple alternative asset investment Funds and served as Chair of Investment Committee for domestic PE efforts.

Prior to Invesco, Carl served as

Managing Partner and co-owner at Wellspring Capital Management LLC, a private equity investment firm focused on control investments in growing companies in the industrial products & services, healthcare and consumer industries.

He oversaw and

approved all investments as a member of the Investment Committee.

At the time of his retirement in 2015, the firm had invested more than $2.5 billion in 35 platform companies and achieved top-tier investment results.

Currently, Carl serves as the Founder of cbGrowth Partners, which focuses on sustainable investments, and serves as Advisor to Auldbrass Partners.

Previously, Carl worked at Dimeling, Schreiber

& Park, Peter J Solomon & Co, Associates, and Ernst & Young Corporate Finance LLC.

Stanton holds a BS degree in Accounting from the University of Alabama and an MBA degree from Harvard Business School.

He resides in New York with

his family and serves as Trustee, Treasurer and Head of Finance and Endowment Committee of Christ Church United Methodist, a nonprofit organization.

He also serves as Board of Visitors at the University of Alabama, College of Commerce.

Carl’s significant experience of leading companies across transformative private equity and asset management and extensive experience with special purpose acquisition companies makes him well qualified to serve as a member of our board of

Lyles II, Chief Financial Officer .

Ernest serves as our Chief Financial Officer and as the Chief Financial Officer and a director of Focus Impact

BH3 Acquisition Company, a special purpose acquisition corporation (Nasdaq:

Ernest is also the Founder and a Managing Partner of The HiGro Group, a private equity firm focused on buyout investing in the lower middle market, which he

founded in 2016.

In addition to serving as a board member on HiGro’s portfolio companies, Ernest co-manages all aspects of the firm’s including investment activities, growth initiatives and talent development.

Prior to founding The HiGro Group, Ernest spent a decade as an investment banker with UBS Investment Bank where his tenure included advising the world’s most notable corporations and private

equity firms.

As the head of Technology Enabled Services banking practice, Ernest became the most senior African-American investment banker within the firm’s industry coverage groups.

In addition to his over $10 billion of transaction and

advisory experience, Ernest served as Head of the Diversity Task Force and Head of the Howard University recruiting team among other internal committees.

A native of Shepherdstown, West Virginia, Ernest attended public schools and earned a full merit scholarship to attend Shepherd University, where he earned a Bachelors of Science degree with

concentrations in Political Science and Business Administration.

Upon graduation, Ernest enrolled in the Howard University School of Law, where he also interned at both the JC Watts Companies.

Ernest has held expert discussions on

entrepreneurship, mentorship, private equity, impact investing and work-life balance.

His speaking engagements have included companies such as Google, HEC Paris, McGuire Woods and Nomura.

An avid art collector, Ernest has also been featured in

publications such as “The Black Market:

A Guide to Art Collecting.

Ernest currently lives in Harlem, New York, where he is actively engaged in civic and faith initiatives including Trustee to Scan Boys and Girls Harbor, Founder of The UTULIVU Alliance, Member of

the Economic Club of New York, and Fellow in the Council of Urban Professionals.

Thorn, Chief Investment Officer .

Wray is a Partner and Co-Founder of Focus Impact Partners, LLC and currently serves as our Chief Investment

Officer and as the Chief Investment Officer and a director of Focus Impact BH3 Acquisition Company, a special purpose acquisition corporation (Nasdaq:

Wray is also the Founder and Chief Executive of Clear Heights Capital, a private

investment firm committed to helping companies realize their growth and development objectives and a Board Member of Skipper Pets, Inc.

Wray is deeply involved in building and leading businesses to source, structure, finance and make private

investments as well as helping companies, organizations and executives realize their growth and development objectives.

With three decades of experience as a Chief Investment Officer, investment leader and lead director, Wray has firsthand

knowledge of investment firm leadership, private investing company value creation, asset allocation strategy and practice and risk management frameworks.

Wray has also been at the forefront of proactive impact investing and applying data and

technology to innovate private investing.

Prior to founding Focus Impact and Clear Heights, Wray was Managing Director and Chief Investment Officer—Private Investments at Two Sigma Investments.

Wray architected and led the firm’s private

equity (Sightway Capital), venture capital (Two Sigma Ventures) and impact (Two Sigma Impact) investment businesses as Chief Executive and Chief Investment Officer of TSPI, LP and Chair & Venture Partner of TSV.

Initially on behalf of private

capital and expanding to include institutional investors, Wray grew the private investment businesses during his 9-year tenure to nearly $4 billion in AUM and 90 team members and was a leader in the creation of Hamilton Insurance Group and the

incubation of Two Sigma’s insurance technology activities, Prior to Two Sigma, Wray was a Senior Managing Director with Marathon Asset Management, where he developed the firm’s private equity investment activities and played a role in many new

business opportunities and capital formation initiatives, including the firm’s direct lending business and its participation in the US Treasury’s Legacy Securities Public-Private Investment Program..

Prior to Marathon, Wray evaluated and executed

management buyout transactions as a Director with Fox Paine & Co.

and as a Principal at Dubilier & Co.

Wray began his career in the financial analyst program at Chemical Bank (today, J.P.

Morgan) as an Associate in the Acquisition Finance

Wray has been involved in approximately 300 transactions, add-on acquisitions, realizations, corporate financings, fundraisings and other principal transactions with aggregate consideration in

excess of $32 billion, including direct private equity, venture and third-party managed fund investments representing more than $3 billion in invested capital.

Wray has been a part of driving shareholder value creation and corporate growth as

member of boards, advisory boards and committees or as an adviser for more than 45 companies and investment funds, across industries including technology, financial services, education, consumer services and real assets.

Working with both private

capital organizations and institutional investors, Wray has architected and led multiple private investment businesses, defining investment objectives, devising strategy, recruiting team members, setting culture, developing investor and financing

relationships, and managing investment processes and decisions.

Wray is committed to giving back to the community, serving as Co-Chair of the Board of Youth, INC, as Vice Chair of the Board and Chair of the Investment Committee for Futures and Options, as a

grant monitor and event committee chair for Hour Children, and as an Associate of the Harvard College Fund.

In his 15+ years working with Youth, INC, a venture philanthropy nonprofit organization in New York City, Wray has engaged in many aspects

of the organization’s growth and development including recruiting senior leadership, leading strategic planning initiatives, chairing the governance and compensation committees and being a part of raising more than $100 million to impact the

lives of NYC youth by empowering more than 175 grass-roots non-profits that serve them.

Wray earned an A.B.

from Harvard University.

Sanders, Lead Director .

Howard Sanders serves as our lead director and is the managing member of Auldbrass Partners, a growth-focused private

equity firm investing primarily in secondaries transactions, which he founded in 2011.

Sanders heads Auldbrass Partners’ transactional sourcing, deal execution, investment strategy and business development.

Sanders has led successful

Auldbrass Partners investments in SaaS (Software as a Service), PaaS (Platform as a Service), tech-enabled manufacturing and services, healthcare and EdTech companies.

Before founding Auldbrass Partners, Mr.

Sanders was a Managing Director at

Citigroup where he was responsible for managing and directing Citi Holdings’ proprietary investments in private equity, hedge funds and real estate.

Prior to Citi, Mr.

Sanders was a Vice President in mergers and acquisitions for Deutsche Bank (a

successor to James D.

Wolfensohn and Co.).

Sanders also previously served as an adjunct professor at Columbia Business School.

Sanders is currently a board member of the Partnership for New York City Foundation, the Riverside Church in the City of New York and the Undergraduate Executive Board of the Wharton School

at the University of Pennsylvania.

Sanders holds a Master of Business Administration from Harvard University and a Bachelor of Science from the Wharton School at the University of Pennsylvania.

We believe that Mr.

Sanders’ significant

experience in investment management leadership, company and private equity fund evaluation and analysis and investment banking leadership make him well qualified to serve as a member of our board of directors.

Troy Carter, Independent Director .

Troy serves as our independent director and is the founder and CEO of Q&A, a music technology company focused on

building software solutions for recording artists via distribution and analytics.

Troy currently serves as a director of Focus Impact BH3 Acquisition Company, a special purpose acquisition corporation (Nasdaq:

He also serves as an advisor

to the NBA Players Association.

He previously served as an advisor to the Prince Estate.

Prior to founding Q&A, Troy was Global Head of Creator Services at Spotify from 2016 to 2018 and then served in a consulting role for CEO Daniel Ek until

Troy serves on the boards of WeTransfer and SoundCloud, and served as an advisor to Lyft.

He is also an active early stage investor, including in companies such as Uber, Lyft, Dropbox, Spotify, Slack, Warby Parker, Gimlet Media, and Thrive

Troy previously founded the entertainment company, Atom Factory, in 2008, where he worked with Lady Gaga, John Legend and Meghan Trainor.

Troy is an executive member on the boards of trustees at The Aspen Institute and the Los Angeles County Museum of Art as well as a Henry Crown Fellow.

In addition, he is a member of the United

Nations Foundation Global Entrepreneurs Council.

Troy also has served on the boards of directors of the Los Angeles Mayor’s Council for Technology & Innovation and CalArts.

Troy has previously been included on Fast Company’s list of most

creative people and on Billboard’s Power 100 list, an annual ranking the music industry’s top influencers.

We believe Troy’s significant business experience in various technology companies and his experience serving on the boards of technology

companies makes him well qualified to serve as a member of our board of directors.

Dawanna Williams, Independent Director .

Williams serves as our independent director and as the managing principal at Dabar Development Partners, which

Williams founded over 15 years ago.

Dabar has developed over 3,000 apartments units covering more than 2 million square feet of mixed-use developments and has had principal involvement in development projects awarded by NYC’s Department of

Housing Preservation and Development, NYC’s Economic Development Corporation, and New York City’s Housing Authority.

As managing principal, Ms.

Williams is involved in all executive aspects of business operations, from developing strategic

priorities to executing development projects to risk management to establishing firm values and standards.

Prior to Dabar, Ms.

Williams served as General Counsel at Victory Education Partners and as a senior associate in the commercial real

estate group at Sidley Austin LLP.

Williams serves on the board of directors of ACRES Commercial Realty Corp.

ACR) is a real estate investment trust that is primarily focused on originating, holding and managing

commercial real estate (“CRE”) mortgage loans and other commercial real estate-related debt investments, Compass, Inc., (NYSE:

COMP), a publicly-traded, technology-enabled residential real estate brokerage company and Ares Industrial Real Estate

Income Trust Inc., a real estate investment trust.

Williams also serves on the board of directors of the Apollo Theater, chairing the real estate committee, and on the board of directors for the New York City Trust for Cultural Resources.

Williams also serves on the board of directors of the New York Real Estate Chamber.

Williams earned an A.B.

from Smith College in economics and government, a Master of Public Administration from Harvard University Kennedy School of

Government, and a Doctor of Jurisprudence from the University of Maryland School of Law.

We believe that Ms.

Williams’ experience in investment management, her background in transaction law and corporate governance and her public company board

experience make her well qualified to serve as a member of our board of directors.

Dia Simms, Independent Director .

Dia serves as our independent director and as the Executive Chairwoman of the

Board of Lobos 1707 Tequila & Mezcal, an award-winning, independent spirits brand that launched in November 2020.

Before being appointed Executive Chairwoman, Dia led Lobos 1707 as its CEO, alongside Founder and Chief Creative Officer Diego

Osorio with early backing by sports and cultural icon, LeBron James.

Dia currently serves as a director of Focus Impact BH3 Acquisition Company, a special purpose acquisition corporation, (Nasdaq:

Dia is also Co-Founder of Pronghorn, a

10-year initiative to drive diversity, equity and inclusion in the spirits industry.

Dia spent almost fifteen years working alongside Sean “Diddy” Combs at Combs Enterprises.

In 2017, Dia was named President of Combs Enterprises, making her the

first president in the company’s thirty-year history other than Sean Combs himself.

In her role as President, she oversaw multi-billion-dollar brands under the Combs empire, including CÎROC Ultra-Premium Vodka, Blue Flame Agency, AQUAhydrate, Bad

Boy Entertainment, Sean John and Revolt TV.

Of note, Dia led the transformation of CÎROC Ultra-Premium Vodka from infancy to a multibillion dollar value brand.

Along with a lengthy list of accolades, Dia is Board Chair of Pronghorn, Board Vice Chair of Saint Liberty Whiskey, Advisor to Touch Capital and director on the FIAC Board.

Dia holds a B.S.

degree in Psychology from Morgan State University and a Master’s degree in Management from the Florida Institute of Technology.

We believe Dia’s significant business experience as a CEO and significant deal-making experience make her well

qualified to serve as a member of our board of directors.

Number and Terms of Office of Officers and Directors

We have five directors at the time of this Report.

Our board of directors are divided into three classes with only one class of directors being elected in each year and each class (except for

those directors appointed prior to our first annual meeting of stockholders) serving a three-year term.

The term of office of the first class of directors, consisting of Troy Carter, will expire at our first annual meeting of stockholders.

term of office of the second class of directors, consisting of Howard Sanders and Carl Stanton, will expire at the second annual meeting of stockholders.

The term of office of the third class of directors, consisting of Dawanna Williams and Dia

Simms, will expire at the third annual meeting of stockholders.

We may not hold an annual meeting of stockholders until after we consummate our initial business combination.

Prior to the completion of an initial business combination, any vacancy on the board of directors may be filled by a nominee chosen by holders of a majority of our founder shares.

prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason.

Pursuant to an agreement to be entered into concurrently with the issuance and sale of the securities in our initial public offering, our sponsor, upon consummation of an initial business

combination will be entitled to nominate three individuals for election to our board of directors.

Our officers are appointed by the board of directors and serve at the discretion of the board of directors, rather than for specific terms of office.

Our board of directors is authorized to

appoint persons to the offices set forth in our bylaws as it deems appropriate.

Our bylaws provide that our officers may consist of a Chairman of the Board, Chief Executive Officer, President, Chief Financial Officer, Vice Presidents, Secretary,

Treasurer and such other offices as may be determined by the board of directors.

Director Independence

Nasdaq listing standards require that a majority of our board of directors be independent.

An “independent director” is defined generally as a person that, in the opinion of the company’s board

of directors, has no material relationship with the listed company (either directly or as a partner, stockholder or officer of an organization that has a relationship with the company).

Our board of directors has determined that Troy Carter, Dia

Simms and Dawanna Williams are “independent directors” as defined in the Nasdaq listing standards and applicable SEC rules.

Our independent directors have regularly scheduled meetings at which only independent directors are present.

Officer and Director Compensation

None of our officers or directors has received any cash compensation for services rendered to us.

Commencing on the date that the Company’s securities were first listed on Nasdaq the Company

began to reimburse an affiliate of the sponsor for office space, administrative and support services provided to the Company in the amount of $10,000 per month.

Upon completion of our initial business combination or our liquidation, we will

cease paying these monthly fees.

No compensation of any kind, including finder’s and consulting fees, will be paid to our sponsor, officers and directors, or any of their respective affiliates, for services rendered prior to or in connection

with the completion of our initial business combination.

However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and

performing due diligence on suitable business combinations.

Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or our or their affiliates.

After the completion of our initial business combination, directors or members of our management team who remain with us may be paid consulting or management fees from the combined company.

of these fees will be fully disclosed to stockholders, to the extent then known, in the tender offer materials or proxy solicitation materials furnished to our stockholders in connection with a proposed business combination.

established any limit on the amount of such fees that may be paid by the combined company to our directors or members of management.

It is unlikely the amount of such compensation will be known at the time of the proposed business combination,

because the directors of the post-combination business will be responsible for determining officer and director compensation.

Any compensation to be paid to our officers will be determined, or recommended to the board of directors for

determination, either by a compensation committee constituted solely by independent directors or by a majority of the independent directors on our board of directors.

We do not intend to take any action to ensure that members of our management team maintain their positions with us after the consummation of our initial business combination, although it is

possible that some or all of our officers and directors may negotiate employment or consulting arrangements to remain with us after our initial business combination.

The existence or terms of any such employment or consulting arrangements to

retain their positions with us may influence our management’s motivation in identifying or selecting a target business but we do not believe that the ability of our management to remain with us after the consummation of our initial business

combination will be a determining factor in our decision to proceed with any potential business combination.

We are not party to any agreements with our officers and directors that provide for benefits upon termination of employment.

Committees of the Board of Directors

Our board of directors has two standing committees:

an audit committee and a compensation committee.

Subject to phase-in rules and a limited exception, the rules of Nasdaq and Rule 10A-3 of the

Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and the rules of Nasdaq require that the nominating and compensation committees of a listed company be comprised solely of independent

Subject to phase-in rules and a limited exception, the rules of Nasdaq require that the compensation committee of a listed company be comprised solely of independent directors.

Audit Committee

We have established an audit committee of the board of directors.

Troy Carter, Dia Simms and Dawanna Williams serve as members of our audit committee, and Dawanna Williams serves as chairman of

the audit committee.

Under Nasdaq listing standards and applicable SEC rules, all the directors on the audit committee must be independent.

Our board of directors has determined that each of Troy Carter, Dia Simms and Dawanna Williams are

Each member of the audit committee is financially literate and our board of directors has determined that Dawanna Williams qualifies as an “audit committee financial expert” as defined in

applicable SEC rules, and chairs the audit committee.

We have adopted an audit committee charter, which details the principal functions of the audit committee, including:

the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm and any other independent registered public accounting firm engaged by us;

pre-approving all audit and permitted non-audit services to be provided by the independent registered public accounting firm or any other registered public accounting firm engaged by us, and establishing pre-approval policies and

reviewing and discussing with the independent registered public accounting firm all relationships they have with us in order to evaluate their continued independence;

setting clear hiring policies for employees or former employees of the independent registered public accounting firm;

setting clear policies for audit partner rotation in compliance with applicable laws and regulations;

Compensation Committee

We have established a compensation committee of the board of directors.

The members of our compensation committee are Troy Carter, Dia Simms and Dawanna Williams, and Troy Carter serves as

chairman of the compensation committee.

Under Nasdaq listing standards, we are required to have a compensation committee composed entirely of independent directors.

Our board of directors has determined that each of Troy Carter, Dia Simms and

Dawanna Williams are independent.

We have adopted a compensation committee charter, which details the principal functions of the compensation committee, including:

reviewing and approving on an annual basis the corporate goals and objectives relevant to our Executive Officers’ compensation, evaluating our Executive Officers’ performance in light of such goals and objectives and determining and

approving the remuneration (if any) of our Executive Officers based on such evaluation;

reviewing and approving on an annual basis the compensation of all of our other officers;

reviewing on an annual basis our executive compensation policies and plans;

implementing and administering our incentive compensation equity-based remuneration plans;

Notwithstanding the foregoing, as indicated above, other than the $10,000 per month administrative fee payable to an affiliate of our sponsor and reimbursement of expenses, no compensation of any

kind, including finders, consulting or other similar fees, will be paid to any of our initial stockholders, officers, directors or any of their respective affiliates, prior to, or for any services they render in order to effectuate the

consummation of a business combination.

Accordingly, it is likely that prior to the consummation of an initial business combination, the compensation committee will only be responsible for the review and recommendation of any

compensation arrangements to be entered into in connection with such initial business combination.

The charter will also provide that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other advisor and will be

directly responsible for the appointment, compensation and oversight of the work of any such advisor.

However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other advisor, the compensation

committee will consider the independence of each such advisor, including the factors required by Nasdaq and the SEC.

Director Nominations

We do not have a standing nominating committee.

In accordance with Rule 5605(e)(2) of the Nasdaq rules, a majority of the independent directors may recommend a director nominee for selection by

the board of directors.

The board of directors believes that the independent directors can satisfactorily carry out the responsibility of properly selecting or approving director nominees without the formation of a

standing nominating committee.

As there is no standing nominating committee, we do not have a nominating committee charter in place.

The board of directors will also consider director candidates recommended for nomination by our shareholders during such times as they are seeking proposed nominees to stand for election at the

next annual meeting of shareholders (or, if applicable, a special meeting of shareholders).

Our shareholders that wish to nominate a director for election to the board of directors should follow the procedures set forth in our amended and

restated certificate of incorporation and bylaws.

We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess.

In general, in identifying and evaluating nominees

for director, the board of directors considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of

our stockholders.

Compensation Committee Interlocks and Insider Participation

None of our officers currently serves, or in the past year has served, as a member of the board of directors or compensation committee of any entity that has one or more officers serving on our

board of directors.

Code of Ethics

We have adopted a Code of Ethics applicable to our directors, officers and employees.

A copy of the Code of Ethics will be provided without charge upon request from us.

We intend to disclose any

amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K.

Conflicts of Interest

Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or

director is or will be required to present business combination opportunities to such entity.

Accordingly, in the future, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to

which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity.

We do not believe, however, that any fiduciary duties or

contractual obligations of our officers arising in the future would materially undermine our ability to complete our business combination.

Potential investors should also be aware of the following other potential conflicts of interest:

None of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest in allocating his or her time among various business activities.

In the course of their other business activities, our officers and directors may become aware of investment and business opportunities which may be appropriate for presentation to us as well as the other entities with which they are

Our management may have conflicts of interest in determining to which entity a particular business opportunity should be presented.

Our initial stockholders have agreed (i) to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination and a stockholder vote to

approve an amendment to our amended and restated certificate of incorporation (A) that would modify the substance or timing of our obligation to provide holders of shares of Class A common stock the right to have their shares redeemed in

connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by the Termination Date or (B) with respect to any other provision relating to the rights of

holders of our Class A commons stock and (ii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination by the

Termination Date (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame).

If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and

the private placement warrants will expire worthless.

With certain limited exceptions, the founder shares will not be transferable, assignable by our sponsor until the earlier of:

(A) one year after the completion of our initial

business combination;

or (B) subsequent to our initial business combination, (x) if the closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations,

recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock

exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property.

With certain limited exceptions, the private

placement warrants and the Class A common stock underlying such warrants, will not be transferable, assignable or saleable by our sponsor or its permitted transferees until 30 days after the completion of our initial business

Since our sponsor and officers and directors may directly or indirectly own common stock and warrants following our initial public offering, our officers and directors may have a conflict of interest in determining whether a

particular target business is an appropriate business with which to effectuate our initial business combination.

Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition

to any agreement with respect to our initial business combination.

Our sponsor, officers or directors may have a conflict of interest with respect to evaluating a business combination and financing arrangements as we may obtain loans from our sponsor or an affiliate of our sponsor or any of our

officers or directors to finance transaction costs in connection with an intended initial business combination.

Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender.

Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period.

The conflicts described above may not be resolved in our favor.

In general, officers and directors of a corporation incorporated under the laws of the State of Delaware are required to present business opportunities to a corporation if:

the corporation could financially undertake the opportunity;

the opportunity is within the corporation’s line of business;

it would not be fair to our company and its stockholders for the opportunity not to be brought to the attention of the corporation.

Accordingly, as a result of multiple business affiliations, our officers and directors may have similar legal obligations relating to presenting business opportunities meeting the above-listed

criteria to multiple entities.

Below is a table summarizing the entities to which our executive officers and directors currently have fiduciary duties or contractual obligations:

Entity’s Business

Westwood Estate Wines

Food and Beverage

Managing Partner

cbGrowth Partners

Focus Impact BH3 Acquisition Company

Blank Check Company

Chief Executive Officer and Director

Skipper Pets, Inc.

Consumer and Pet Services

The HiGro Group

Private Equity

Founder and Managing Partner

Focus Impact BH3 Acquisition Company

Blank Check Company

Chief Financial Officer and Director

Clear Heights Capital

Private Equity and Venture Capital

Founder and Chief Executive Officer

Nonprofit Organization

Co-Chair of Board of Directors

Futures and Options

Nonprofit Organization

Director and Chair of Investment Committee of Board

Sailfish Productions

Entertainment and Media

General Manager

Focus Impact BH3 Acquisition Company

Blank Check Company

Chief Investment Officer and Director

Skipper Pets, Inc.

Consumer and Pet Services

Howard Sanders

Auldbrass Partners L.P.

Private Equity

Founder and Managing Member

Technology and Multimedia

Founder and Chief Executive Officer

The Aspen Institute

Nonprofit Organization

Executive Member on the Board of Trustees

Los Angeles County Museum of Art

Executive Member on the Board of Trustees

Focus Impact BH3 Acquisition Company

Blank Check Company

Dawanna Williams

Dabar Development Partners

Managing Principal

ACRES Commercial Realty Corp.

Ares Industrial Real Estate Income Trust Inc.

Compass, Inc.

Lobos 1707 Tequila & Mezcal

Food and Beverages

Chief Executive Officer

Tilt Holdings Inc.

Cannabis-Focused Holding Company

Focus Impact BH3 Acquisition Company

Blank Check Company

Accordingly, if any of the above executive officers or directors becomes aware of a business combination opportunity which is suitable for any of the above entities to which he or she has current

fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity.

not believe, however, that any of the foregoing fiduciary duties or contractual obligations will materially affect our ability to complete our business combination.

Our amended and restated certificate of incorporation provides that we renounce

our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are

legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue.

We are not prohibited from pursuing an initial business combination with a company that is affiliated with or related to Auldbrass Partners, our sponsor, officers, directors or members of our

advisory board.

In the event we seek to complete our initial business combination with a company that is affiliated with or related to any of Auldbrass Partners, our sponsor, officers, directors or members of our advisory board, we, or a

committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our

company from a financial point of view.

We are not required to obtain such an opinion in any other context.

We have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor.

In the event that we submit our initial business

combination to our public stockholders for a vote, our initial stockholders have agreed to vote any founder shares held by them and any public shares purchased during or after the offering in favor of our initial business combination and our

officers and directors have also agreed to vote any public shares purchased during or after the offering in favor of our initial business combination.

Limitation on Liability and Indemnification of Officers and Directors

Our amended and restated certificate of incorporation provides that our officers and directors will be indemnified by us to the fullest extent authorized by Delaware law, as it now exists or may

in the future be amended.

In addition, our amended and restated certificate of incorporation provides that our directors will not be personally liable for monetary damages to us or our stockholders for breaches of their fiduciary duty as

directors, unless they violated their duty of loyalty to us or our stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or

derived an improper personal benefit from their actions as directors.

We have entered into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our amended and restated certificate of

incorporation.

Our bylaws also permit us to secure insurance on behalf of any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification.

purchased a policy of directors’ and officers’ liability insurance that insures our officers and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify

our officers and directors.

These provisions may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty.

These provisions also may have the effect of reducing the

likelihood of derivative litigation against officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders.

Furthermore, a stockholder’s investment may be adversely affected to the extent we

pay the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions.

We believe that these provisions, the insurance and the indemnity agreements are necessary to attract and retain talented and experienced officers and directors.

The information required by this item and not set forth below will be set forth in the sections headed “ Election of Directors ,” “ Executive Officers ” and “ Delinquent Section 16(a) Reports ” in our definitive proxy statement for our 2026 Annual Meeting of Stockholders (the “Proxy Statement”),

to be filed with the SEC within 120 days after the end of the fiscal year ended July 31, 2025 and is incorporated herein by reference.

EXECUTIVE COMPENSATION.

The following disclosure concerns the compensation of our executive officers and directors for the fiscal year ended December 31, 2023.

None of our officers or directors received any cash compensation for services rendered to us.

Commencing on the date that the Company’s securities were first listed on Nasdaq the Company began to

reimburse an affiliate of the sponsor for office space, administrative and support services provided to the Company in the amount of $10,000 per month.

Upon completion of our initial business combination or our liquidation, we will cease paying

these monthly fees.

completion of our initial business combination.

However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due

diligence on suitable business combinations.

Our audit committee has and will continue to review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or our or their affiliates.