Drugs Made In America Acquisition Corp. 10-K

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. 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 “Cautionary 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 incorporated as an exempted company in the Cayman Islands on May 23, 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. We intend to effectuate our initial business combination using cash derived from the proceeds of the Initial Public Offering and the sale of the Private Placement Units, our shares, debt or a combination of cash, shares and debt. We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an initial business combination will be successful. Results of Operations We have neither engaged in any operations nor generated any operating revenues to date. Our only activities from inception through December 31, 2025 were organizational activities and those necessary to prepare for the Initial Public Offering, described below. We do not expect to generate any operating revenues until after the completion of our initial business combination. We expect to generate non-operating income in the form of interest income on cash and investments held in the trust account after the Initial Public Offering. We expect that we will incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with searching for, and completing, a business combination. For the year ended December 31, 2025, we had net income of $5,940,643, which consisted of interest earned on cash and investments held in Trust Account of $8,756,656, offset by general and administrative costs of $2,816,013 which includes a share issuance expense of $1,996,000. The share issuance expense is a non-cash expense incurred as a result of an issuance of 200,000 ordinary shares to an investor of the sponsor for no consideration on March 11, 2025. For the period from May 23, 2024 (inception) through December 31, 2024, we had a net loss of $279,845, which consisted of general and administrative costs. Liquidity and Capital Resources As of December 31, 2025 and 2024, we had cash of $6,137 and $1,351, respectively. Until the consummation of the Initial Public Offering, our only source of liquidity was an initial purchase of ordinary shares by the sponsor and loans from our sponsor. On January 29, 2025, we consummated the Initial Public Offering of 20,000,000 Units, at a price of $10.00 per unit, generating gross proceeds of $200,000,000. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 400,000 Private Placement Units to the sponsor at a price of $10.00 per unit for $4,000,000, of which $1,100,000 has not yet been received and is noted as a subscription receivable, which may be converted from the amounts advanced to the Company under the Subscription Promissory Note as described below. On February 18, 2025, the underwriters exercised their over-allotment option to purchase an additional 3,000,000 Units at a purchase price of $10.00 per Unit, generating additional gross proceeds of $30,000,000. Simultaneously with the sale of the over-allotment Units, the sponsor purchased an additional 30,000 Private Placement Units at a purchase price of $10.00 per unit, generating additional gross proceeds of $300,000. Following the Initial Public Offering, the sale of the Private Placement Units and the over-allotment option close, a total of $231,150,000 was placed in the trust account. On January 29, 2025, we issued a new unsecured subscription promissory note to the sponsor (the “Subscription Promissory Note”) in connection with the amended and restated units purchase agreement pursuant to which we may borrow up to an aggregate principal amount of $1,100,000 working capital loans. The sponsor further agrees that such loans shall be converted into Private Placement Units, at the price of $10.00 per unit. To the extent the amount of such loans is less than $1,100,000, the sponsor acknowledges and agrees that it (or, if applicable, it and any transferees of Private Placement Units) shall surrender for cancellation any and all rights to up to an aggregate of 110,000 Private Placement Units at $10.00 per unit. We incurred $8,898,201 of transaction costs, consisting of $1,150,000 of cash underwriting fees, $6,900,000 of deferred underwriting fees, and $848,201 of other offering costs. 14 We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account, which interest shall be net of taxes payable and excluding deferred underwriting commissions, to complete our initial business combination. We may withdraw interest from the trust account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete an initial business combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies. In order to fund working capital deficiencies or finance transaction costs in connection with an initial business combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete an initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. In the event that a business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment. Up to $1,500,000 of such working capital loans may be convertible into units of the post-business combination entity at a price of $10.00 per unit. The units would be identical to the Private Placement Units. If our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. 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. We intend to use the funds from the Subscription Promissory Note primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete an initial business combination. On March 18, 2026, the managing member of the Sponsor, along with her spouse, entered into a sponsor standstill, non-voting and cooperation acknowledgement in which her acknowledged the Sponsor is unable to fulfill the financial and operation obligations typically associated with the sponsor role. They agreed to refrain from taking any actions with respect to the Company and to cooperate with the current management team on the transfer of founder shares and other securities held by the Sponsor when permissible. On March 23, 2026, we issued an interim convertible note (the “Interim Note”) to BV Advisory Partners, LLC (the “Investor”) in the principal amount of $100,000 (the “Interim Loan”). The Interim Loan represents an initial loan towards a contemplated $500,000 financing (the “Financing”) pursuant to the Definitive Interim Investment and Sponsor Transition Agreement dated March 23, 2026 (the “Investment Agreement”) described below. The Interim Note has a maturity date six months from the date of issuance, unless earlier converted or credited toward the definitive financing under the Investment Agreement and does not bear interest. Upon the consummation of initial business combination by us (a “Business Combination”), the outstanding principal amount of the Interim Loan may, at the option of the Investor, be converted into shares of the combined entity at a conversion price equal to a 35% discount to the market price of such shares at the time of conversion. On March 23, 2026, we entered into the Investment Agreement with the Investor relating to a proposed financing transaction pursuant to which the Investor indicated its intent to provide financing to us through a convertible note investment, of which the Interim Loan represented the first tranche. Pursuant to the Investment Agreement, the aggregate amount to be loaned is $500,000. The second tranche of $200,000 will be made within 21 days with the remainder of the commitment on an as-needed basis. We also agreed to use commercially reasonable efforts to provide the Investor with not less than 40% of the economic benefit equivalent to sponsor-level economics. The Investor has the right but not the obligation to provide additional funding beyond the $500,000 commitment. In connection with the Investment Agreement, the Investor has introduced to us a potential business combination opportunity involving an enterprise technology platform focused on artificial intelligence, machine learning, quantum analytics, and cybersecurity solutions, consistent with the business of Power Analytics Global Corporation. 15 Going Concern As of December 31, 2025, the Company had $6,137 cash and a working capital deficit of $363,981. The Company expects to incur significant professional costs to remain as a publicly traded company and to incur significant transaction costs in pursuit of the consummation of an initial business combination. The Company’s business plan is dependent on the completion of a business combination within a prescribed period of time and if not completed will cease all operations except for the purpose of liquidating. In connection with our assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that these conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Off-Balance Sheet Financing Arrangements We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2025 or 2024. 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 We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than to pay the sponsor $10,000 per month for office space, and administrative and support services pursuant to an administrative services agreement which has been cancelled in March 2026. The underwriters were entitled to a cash underwriting discount of $0.05 per Unit, or 0.5% of the gross proceeds of the Initial Public Offering, or $1,150,000 in the aggregate, paid at the closing of the Initial Public Offering and the over-allotment close. In addition, the underwriters are entitled to a deferred fee of $0.30 per Unit, or 3.0% of the gross proceeds of the Initial Public Offering, or $6,900,000 in the aggregate, of which 25.0% will be adjusted net of redemptions (i.e., for purposes of calculating the deferred underwriting commission net of redemptions, 25.0% of the deferred underwriting commissions will determined by the dollar amount that is product of (i) 3.0% multiplied by the product of the number of unredeemed public shares, multiplied by $10.00 and (ii) 25.0%). The deferred fee becomes payable to the underwriters from the amounts held in the trust account solely in the event that we complete a business combination, subject to the terms of the underwriting agreement. In addition, we issued the underwriters 230,000 ordinary shares, denoted as representative shares. Critical Accounting Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have not identified any critical accounting estimates. Related Party Transactions Founder Shares On June 17, 2024, the Company issued to the sponsor an aggregate of 22,361,111 ordinary shares, par value $0.0001 per share, in exchange for $35,000 or approximately $0.0016 per share. On November 6, 2024, the sponsor surrendered and forfeited 12,503,968 ordinary shares to the Company for no consideration, following which the sponsor held 9,857,143 ordinary shares (the “Founder Shares”). All share and per share data has been retrospectively presented. The Founder Shares included an aggregate of up to 1,285,714 shares subject to surrender and forfeiture to the extent that the underwriters’ over-allotment was not exercised in full or in part, so that the number of Founder Shares will equal, on an as-converted basis, approximately 30% of the Company’s issued and outstanding ordinary shares after the Initial Public Offering (not including the Private Placement Units and the representative shares and assuming the sponsor does not purchase any Public Shares in the Initial Public Offering). On January 29, 2025 the Company completed its Initial Public Offering and the over-allotment option remained unexercised. Subsequently, on February 18, 2025, the underwriters exercised their over-allotment option to purchase an additional 3,000,000 Units. As such, 1,285,714 shares are no longer subject to forfeiture. 16 The sponsor has entered into a letter agreement with the Company pursuant to which, with certain limited exceptions, the Founder Shares and the Private Placement Units, including the underlying securities, are not transferable, assignable or salable (except to directors and officers and other persons or entities affiliated with the Company’s initial shareholders, each of whom will be subject to the same transfer restrictions) until the earlier of: (i) with respect to 50% of the Founder Shares and the Private Placement Units, the earlier of six months after the date of the consummation of the initial Business Combination and the date on which the closing price of the Company’s ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after the initial Business Combination and (ii) with respect to the remaining 50% of the Founder Shares and the Private Placement Units, six months after the date of the consummation of the initial Business Combination, or earlier, in either case, if, subsequent to the initial Business Combination, the Company consummates a liquidation, merger, share exchange or other similar transaction which results in all of the shareholders having the right to exchange their ordinary shares for cash, securities or other property. Administrative Support Agreement The Company has entered into an administrative services agreement, effective on January 7, 2025, pursuant to which the Company has agreed to pay the sponsor or an affiliate $10,000 for office space, and administrative and support services. The Administrative Services Agreement was cancelled in March 2026. For the year ended December 31, 2025, the Company incurred $111,000 in administrative support fees and included in general and administrative costs on the statements of operations. As of December 31, 2025, $108,300 was recorded as a reduction in share subscription receivable on the balance sheets. For the period from May 23, 2024 (inception) through December 31, 2024, the agreement was not in effect and did not incur fees for these services. Promissory Note — Related Party On June 13, 2024, the sponsor issued an unsecured promissory note to the Company (the “Promissory Note”), pursuant to which the Company may borrow up to an aggregate principal amount of $500,000. On November 21, 2024, the sponsor amended the Promissory Note to increase the amount the Company may borrow to $750,000. On December 5, 2024, the sponsor further amended the Promissory Note to increase the amount the Company may borrow to $1,850,000. The Promissory Note is non-interest bearing and was repaid in full in connection with the Company’s Initial Public Offering. During the period from May 23, 2024 (inception) through December 31, 2024, the Company received funds totaling approximately $1,700,000 from various investors on behalf of the sponsor. These monies represent advances paid to the sponsor for purchase of Founder Shares upon successful completion of the Initial Public Offering. The monies were received on behalf of the Sponsor and deposited into the Company’s bank account instead of the sponsor’s bank account. During the period from May 23, 2024 (inception) through December 31, 2024, the Company repaid approximately $1,200,000 of the balance due to the sponsor related to investments it had received on behalf of the sponsor, resulting in a balance of approximately $500,000 due to the sponsor, which is accounted for as part of the promissory note amount on the balance sheets. In conjunction with the Initial Public Offering $900,000 was repaid to the sponsor, $204,000 in deferred offering costs were paid by the sponsor and $94,574 in expenses were paid by the sponsor. As of December 31, 2025 and 2024, there was $0 and $662,324, respectively, outstanding under the Promissory Note. The Promissory Note is no longer available for drawdown as it was repaid in full and expired in connection with the Company’s Initial Public Offering. Consulting Agreement In connection with the appointment of Saleem Elmasri as Chief Financial Officer and principal financial and accounting officer of the Company on November 17, 2025, the Company entered into a master services agreement (the “Consulting Agreement”) with Titan Advisory Services LLC for the provision of such principal financial and accounting officer services by Mr. Elmasri. Under the terms of the Consulting Agreement, the Company will pay Titan Advisory Services LLC $42,000 per year, or $3,500 per month, for services rendered by Mr. Elmasri as Chief Financial Officer. For the year ended December 31, 2025, the Company did not record any amounts due under the Consulting Agreement and no amounts are recorded as outstanding. For the period from August 23, 2024 (inception) through December 31, 2024, we did not incur fees for these services as the agreement had not yet commenced. 17 Advisory Services The Company received advisory services from an uncompensated related party advisor, husband to the former CEO of the Company (the “Advisor”). The role of such advisor was to assist in the day-to-day transactions of the Company. The Company has not received advisory services from the Advisor since the departure of the former CEO and the arrangement is no longer active. CFO Agreement Effective July 1, 2024, the Company’s prior CFO had a consulting agreement with the Company (the “Prior CFO Agreement”). For the year ended December 31, 2025 and for the period from May 23, 2024 (inception) through December 31, 2024, the Company has incurred $22,764 and $11,600 of expense under the Prior CFO Agreement, respectively. As of December 31, 2025 and, 2024, $0 and $1,300 is included in accounts payable and accrued expenses on the balance sheets. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the sponsor or an affiliate of the sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into units of the post-Business Combination entity at a price of $10.00 per unit. The units would be identical to the Private Placement Units. As of December 31, 2025 and 2024, no working capital loans were outstanding. Amended and Restated Private Units Purchase Agreement and Subscription Promissory Note Simultaneously with the closing of the Initial Public Offering, the Company has entered into an amended and restated private units purchase agreement with the sponsor, pursuant to which the sponsor agreed to purchase an aggregate of 400,000 Private Placement Units (or 430,000 Private Placement Units if the underwriters’ over-allotment is exercised in full) at a price of $10.00 per Private Placement Unit ($4,000,000, or an aggregate of $4,300,000 if the underwriters’ over-allotment is exercised in full) from the Company in the private placement. Under the agreement, the sponsor agreed to provide the Company up to $1,100,000 in working capital loans under the subscription promissory note, which loans shall be converted into Private Placement Units, at the price of $10.00 per Unit. To the extent the amount of such loans is less than $1,100,000, the sponsor agreed that it (or, if applicable, it and any transferees of Private Placement Units) shall surrender for cancellation any and all rights to up to an aggregate of 110,000 Private Placement Units at $10.00 per unit. In connection with the sponsor standstill, non-voting and cooperation acknowledgement, the sponsor acknowledged it is unable to fulfill the financial and operational obligations typically associated with the sponsor role, including providing working capital. As such, the sponsor will not provide additional funding and the share subscription receivable. As of December 31, 2025, 45,092 ordinary shares represent the remaining unfunded principal amount of the Subscription Promissory Note. These shares are subject to cancellation and surrender provisions as a result of the Sponsor defaulting on the share subscription receivable. The ordinary shares are presented as issued and outstanding until such time the shares are cancelled or surrendered. Recent Accounting Standards In November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statement. 18