PANTAGES CAPITAL ACQUISITION Corp 10-Q

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Pantages Capital Acquisition Corporation. References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to Aitefund Sponsor LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. Special Note Regarding Forward-Looking Statements This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) that are not historical facts, and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and variations thereof and similar words and expressions are intended to identify such forward-looking statements. Such forward- looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s final prospectus for its initial public offering (the “IPO” described below) filed with the Securities Exchange Commission (the “SEC”) on December 5, 2024 (File No. 333-280986) (the “Prospectus”) and the Company’s annual report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 9, 2026. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Overview Pantages Capital Acquisition Corporation (the “Company”, formerly known as “Shepherd Ave Capital Acquisition Corporation” and “Aifeex Nexus Acquisition Corporation”) is a blank check company incorporated in the Cayman Islands on May 31, 2024 as an exempted company with limited liability. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination involving the Company, with one or more businesses or entities (the “initial business combination”). We intend to effectuate our initial business combination using cash from the proceeds of our IPO, Private Placement (as defined below), and the sale of our shares, debt or a combination of cash, equity 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. Our Initial Public Offering On December 6, 2024, the Company consummated its IPO of 8,625,000 units (the “Public Units”), including 1,125,000 additional Units granted to the underwriters to cover over-allotments, if any (the “over-allotment option”). Public Unit consisting of one Class A ordinary share (the “Class A Ordinary Shares”) of the Company, par value $0.0001 per share (the “Public Shares”), and one right (the “Rights”) of the Company, each right entitling the holder to receive one-fifth of one Class A Ordinary Share for (the “Public Rights”). The Units were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $86,250,000. Simultaneously with the closing of the IPO, we consummated a private placement (the “Private Placement”) with Aitefund Sponsor LLC, our sponsor (the “Sponsor”), of an aggregate of 244,250 units (the “Private Placement Units”) at a price of $10.00 per Private Placement Unit, generating gross proceeds to the Company of $2,442,500. Each Private Placement Unit consists of one Class A ordinary share (the “Private Placement Shares”), and one Right (the “Private Placement Rights”). The terms and provisions of the Private Placement Shares and Private Placement Rights in the Private Placement Units are identical to the Public Shares and Public Rights, respectively, except that, subject to certain limited exceptions, the Private Placement Shares are subject to transfer restrictions until the consummation of the Company’s initial business combination. On December 6, 2024, a total of $86,250,000 of the net proceeds from the IPO and the Private Placement was deposited in a trust account (the “Trust Account”) established for the benefit of the Company’s Public Shareholders with Wilmington Trust, N.A., acting as trustee. 19 Since our IPO, our sole business activity has been identifying, evaluating suitable acquisition transaction candidates and preparing for consummation of an initial business combination. We presently have no revenue and have had losses since inception from incurring formation and operating costs. We have relied upon the sale of our securities and loans from the Sponsor and other parties to fund our operations. The sales of the Private Placement Units issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. No commissions were paid in connection with such sales. Separation of Units On January 23, 2025, the Company announced that holders of the Company’s Public Units may elect to separately trade the Public Shares and Public Rights from the Public Units, commencing on or about January 27, 2025. The Class A Ordinary Shares and Rights were traded on the Nasdaq Global Market (“Nasdaq”) under the symbols “SPHA” and “SPHAR”, respectively. Units not separated continued to trade on Nasdaq under the symbol “SPHAU.” Name Change On March 11, 2025, the Company held the First Shareholder Meeting. At the First Shareholder Meeting, the shareholders of the Company, by special resolution, approved the proposal to amend Company’s amended and restated memorandum and articles of associations to change the Company’s name from “Shepherd Ave Capital Acquisition Corporation” to “Aifeex Nexus Acquisition Corporation” (the “First Name Change”). Promptly following the approval, the Company filed a Second Amended and Restated Memorandum and Articles of Association (the “Second Amended Charter”) with the Cayman Registrar to effect the First Name Change. In connection with the First Name Change, the Company’s ticker symbols for its Units, Class A Ordinary Shares and Rights changed from “SPHAU”, “SPHA”, “SPHAR”, in each case to “AIFEU”, “AIFE”, and “AIFER”, and commenced trading under the new symbols on March 12, 2025. On August 6, 2025, the Company held the Second Shareholder Meeting. At the Second Shareholder Meeting, the shareholders of the Company, by special resolution, approved the proposal to amend Company’s Second Amended Charter to change the Company’s name from “Aifeex Nexus Acquisition Corporation” to “Pantages Capital Acquisition Corporation” (the “Second Name Change”). Promptly following the approval, the Company filed a Third Amended and Restated Memorandum and Articles of Association (the “Current Charter”) with the Cayman Registrar to effect the Second Name Change. In connection with the Second Name Change, the Company’s ticker symbols for its units, ordinary shares and Rights changed from “AIFEU”, “AIFE” “AIFER”, in each case to “PGACU”, “PGAC”, and “PGACR”, and commenced trading under the new symbols on August 8, 2025. Pantages’ Third Amended and Restated Memorandum and Articles of Association, which became effective upon the consummation of its IPO, originally provided that Pantages had until June 6, 2026, to complete its initial business combination (“Business Combination Deadline”). On June 3, 2026, at an extraordinary general meeting of shareholders (the “Third Shareholder Meeting”), shareholders approved, by special resolution, an amendment to Pantages’ Third Memorandum and Articles of Association and an amendment to the Trust Agreement to permit Pantages to extend the Business Combination Deadline up to twelve (12) times, each for one month, from June 6, 2026 to June 6, 2027, by depositing into the Trust Account $0.033 per public share remaining outstanding after redemptions, up to $60,000 per one-month extension. 20 In connection with the shareholders’ vote at the Third Shareholder Meeting, 5,889,094 public shares were tendered for redemption. As a result, approximately $62,365,505.46 (approximately $10.59 per share) will be withdrawn from the Trust Account to pay such holders, without taking into account any additional amounts that may be allocated to satisfy Pantages’ tax obligations since that date. Following these redemptions, 2,980,156 Class A Ordinary Shares and 2,156,250 Class B ordinary shares will remain outstanding. As of the date of this Quarterly Report, the Sponsor has deposited an aggregate of US$120,000 into the Trust Account to extend the Business Combination Deadline to August 6, 2026. The required extension payment of $60,000 to extend the Trust to September 6, 2026 has not been deposited into the Trust Account. Business Combination with MacMines On November 18, 2025, the Company entered into a Business Combination Agreement by and among (i) the Company, (ii) MacMines Austasia Pty Ltd, an Australian proprietary company limited by shares (the “MacMines”), (iii) HORIZON MINING LIMITED, a Cayman Islands exempted company (“Pubco”), (iv) HORIZON MERGER 1 LIMITED, a Cayman Islands exempted company and a wholly-owned subsidiary of Pubco (“Merger Sub”); (v) Horizon Mining SPV Pty Ltd, an Australian proprietary company limited by shares and a wholly owned subsidiary of MacMines (“Tenement SPV”); and (vi) Jincheng Yao, an individual (“Seller Representative”) (the “Merger Agreement”). Reorganization Pursuant to the Merger Agreement, prior to the Closing (as defined below), MacMines and its affiliates shall consummate a series of reorganization transactions, including: (i) MacMines and Pubco will enter into a Share Sale Agreement for the sale by MacMines of all of the issued share capital in Tenement SPV to Pubco in exchange for the issue of Pubco ordinary shares to MacMines (the “Share Sale Agreement”), and (ii) MacMines and Tenement SPV will enter into an Asset Sale Agreement for the sale by MacMines to Tenement SPV of the application for Mining Lease 700074 as lodged with the Queensland Government, Australia, on or about November 16, 2022 (the “MLA”) and documents and information relating exclusively and specifically to the MLA (the “Asset Sale Agreement”) (together with all other agreements, deeds, instruments or documents as may be necessary or appropriate to give effect to the Share Sale Agreement or Asset Sale Agreement as contemplated by those agreements, the “Reorganization Documents”) to implement and effect the transactions contemplated therein in a form reasonably agreed between the parties to the Merger Agreement. Upon the terms and subject to satisfaction of the conditions set forth in the Reorganization Documents, the following transactions (collectively, “Reorganization”) shall take place at a date and time agreed by the parties thereto: (x) Pubco will issue 18,000,000 Pubco ordinary shares (the “Reorganization Shares”) to MacMines in exchange for the transfer of all the issued and outstanding share capital of Tenement SPV held by MacMines to Pubco; and (y) MacMines will assign, transfer, convey and sale to Tenement SPV, and Tenement SPV will acquire and receive from MacMines, all the assets, including the MLA. As a result of the Reorganization, Tenement SPV shall become the wholly-owned subsidiary of Pubco, and Pubco shall become the majority-owned subsidiary of MacMines. 21 Merger After the consummation of the Reorganization and upon the terms and subject to satisfaction of the conditions set forth in the Merger Agreement, at a date and time agreed by the parties to the Merger Agreement (the “Closing Date”): (x) the Merger Sub will merge with and into the Company (the “Merger”, together with all other transactions contemplated under the Merger Agreement, the “MacMines Business Combination”, with the closing of the MacMines Business Combination referred as “Closing”), with the Company surviving the Merger as a wholly owned subsidiary of Pubco and the outstanding securities of the Company and Merger Sub being converted into the right to receive shares of Pubco as follows: ● Each issued and outstanding Unit and Private Placement Unit of the Company shall be automatically detached, and the holder thereof shall be deemed to hold one Class A ordinary share and one right of the Company. ● Each Class A ordinary share of the Company for which a holder has exercised its right of redemption shall be surrendered and cancelled and shall cease to exist and no consideration shall be delivered or deliverable in exchange therefor. Each of the remaining issued and outstanding Class A ordinary shares or Class B ordinary share shall be cancelled and converted automatically into the right to receive one Pubco ordinary share. ● Each issued and outstanding right of the Company shall be automatically converted into the number of Pubco ordinary shares that would have been received by the holder thereof if such right of the Company had been converted upon the consummation of a Business Combination in accordance with the Company’s IPO Prospectus and Current Charter, and the rights into Class A ordinary shares of the Company. ● If there are any shares of the Company that are owned by the Company as treasury shares, such shares shall be cancelled and extinguished without any conversion thereof or payment therefor, and each Merger Sub ordinary share issued and outstanding immediately prior to the Effective Time shall be converted into and exchanged for one validly issued, fully paid and nonassessable share, par value $0.0001 per share, of the Surviving Company. (y) all issued and outstanding Reorganization Shares shall be automatically reclassified into Pubco ordinary shares. No fractional shares of Pubco ordinary shares will be issued by Pubco; instead, each person who would otherwise be entitled to a fractional share shall instead be entitled to the number of Pubco ordinary shares issued to such person rounded down in the aggregate to the nearest whole Pubco ordinary share. The foregoing Merger and conversion of securities shall occur all upon the terms and subject to the conditions set forth in the Merger Agreement and in accordance with the provisions of applicable law. Since the Merger Agreement was executed by March 6, 2026, the 15-month anniversary of the closing of the IPO, the Company’s deadline to complete its initial business combination was initially extended to June 6, 2026, pursuant to the Current Charter, and further extended up to twelve (12) times with each extension comprised of one month, from June 6, 2026 until June 6, 2027. On April 14, 2026, the Company entered into Amendment No. 1 to the Merger Agreement (the “Amendment”). Pursuant to the Amendment, all parties agreed to remove, as a condition to each party’s obligation to consummate the initial business combination, the requirement that the Company have upon the closing of the initial business combination net tangible assets of at least $5,000,001 after giving effect to any redemptions and any PIPE investment that was funded prior to or at the closing of the initial business combination. Amendment of Trust Agreement On June 3, 2026, at the Third Shareholder Meeting, the Company’s shareholders approved a proposal to amend the Trust Agreement to allow the Company to extend the date by which it must consummate an initial business combination up to twelve (12) times, with each extension comprised of one month, from June 6, 2026 until June 6, 2027, by depositing into the trust account an amount equal to $0.033 per public share remaining outstanding after redemptions, up to $60,000 per one-month extension. Monthly Extension Deposit To effectuate each monthly extension, in June and July 2026, the Sponsor deposited the monthly extension fee in the amount of $60,000 each for an aggregated $120,000 into the Trust Account so that the Company has until August 6, 2026 to complete its initial business combination. As of the date of this Quarterly Report is issued, $60,000 of the required extension payment to extend the Trust to September 6, 2026 has not been deposited into the Trust Account. 22 Other Related Agreements Seller Lock-Up Agreement Concurrently with the execution and delivery of the Merger Agreement, the Company, MacMines, and Pubco entered into a Lock-Up Agreement (the “Seller Lock-Up Agreement”), pursuant to which 50.00% of the securities of Pubco held by MacMines (the “Restricted Securities”) will be locked-up and subject to transfer restrictions for a period of time following the closing of the MacMines Business Combination (the “Closing”), as described below, subject to certain exceptions. The lock-up period applicable to the Restricted Securities will commence from the date of Closing (the “Closing Date”) and end until the earlier of (i) the six (6) month anniversary of Closing Date, and (ii) the date on which the closing sale price of the Pubco ordinary shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations, and recapitalizations) for any twenty (20) trading days within any thirty (30) consecutive trading day period commencing after the Closing Date. Seller Support Agreement Concurrently with the execution of the Merger Agreement, the Company and MacMines entered into a support agreement (the “Seller Support Agreement”), pursuant to which, among other things, MacMines agreed (i) not to transfer, and (ii) to vote its Pubco ordinary shares in favor of the Merger Agreement (including by execution of written resolutions), the Merger, and the other transactions. The Seller Support Agreement and all of its provisions will terminate and be of no further force or effect upon the earlier of (i) the effective time of the Closing, (ii) the termination of the Merger Agreement in accordance with its terms, and (iii) the written agreement of the Company and MacMines. Sponsor Support Agreement Concurrently with the execution of the Merger Agreement, the Company, MacMines, and the Sponsor entered into a support agreement (the “Sponsor Support Agreement”), pursuant to which, among other things, the Sponsor agreed (i) not to transfer, and (ii) to vote its ordinary shares of the Company in favor of the Merger Agreement (including by execution of written resolutions), the Merger, and the other transactions. The Sponsor Support Agreement and all of its provisions will terminate and be of no further force or effect upon the earlier of (i) the mutual written consent of Company, MacMines, and the Sponsor, (ii) the effective time of the Closing, or (iii) the termination of the Merger Agreement in accordance with its terms. Registration Rights Agreement The Merger Agreement contemplates that, at the Closing, Pubco and MacMines will enter into a Registration Rights Agreement (the “Registration Rights Agreement”), to be effective as of the Closing, pursuant to which Pubco agrees to file a registration statement as soon as practicable upon receipt of a request from MacMines to register the resale of certain registrable securities under the Securities Act, subject to required notice provisions. Pubco has also agreed to provide customary “piggyback” registration rights with respect to such registrable securities and, subject to certain circumstances, to file a resale shelf registration statement to register the resale under the Securities Act of such registrable securities. The Registration Rights Agreement also provides that Pubco will pay certain expenses relating to such registrations and indemnify the securityholders against certain liabilities. The rights granted under the Registration Rights Agreement supersede any prior registration, qualification, or similar rights of the parties with respect to their MacMines securities or Pubco securities. Recent Development On each of February 26, 2026 and June 16, 2026, the Sponsor agreed to loan the Company up to $500,000 under a promissory note (the “Second Promissory Note” and the “Third Promissory Note”) to be used for working capital of the Company. The loans are non-interest bearing, unsecured and are due at the earlier of (1) the date on which the Company consummates its initial business combination or (2) the date on which the Company liquidates and dissolves. The Sponsor, as the payee, has the right, but not the obligation, to convert the notes, in whole or in part, into Private Placement Units of the Company, that are identical to the Private Placement Units issued by the Company in the Private Placement consummated simultaneously with the Company’s IPO, subject to certain exceptions, as described in the IPO Prospectus, by providing the Company with written notice of the intention to convert at least two business days prior to the closing of the Initial Business Combination. The number of Private Placement Units to be received by the Sponsor in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to the Sponsor by (y) $10.00. 23 Results of Operations We have neither engaged in any operations nor generated any revenues to date. Our only activities from May 31, 2024 (inception) to June 30, 2026 were organizational activities, those necessary to prepare for the IPO, described below, and, after the IPO, identifying a target company for an initial business combination. We do not expect to generate any operating revenues until after the completion of our initial business combination. We may generate non-operating income in the form of interest and dividend income on cash and investments held in the Trust Account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with completing an initial business combination. For the three months ended June 30, 2026, we had net income of $538,284, which consisted of interest and dividend income on cash and investments held in the Trust Account of $754,674 and was partially offset by formation and operating costs of $216,390. For the three months ended June 30, 2025, we had net income of $723,213, which consisted of interest and dividend income on cash and investments held in Trust Account of $900,939 and was partially offset by formation and operating costs of $177,726. For the six months ended June 30, 2026, we had net income of $891,691, which consisted of interest and dividend income on cash and investments held in the Trust Account of $1,540,983 and was partially offset by formation and operating costs of $649,292. For the six months ended June 30, 2025, we had net income of $1,404,067, which consisted of interest and dividend income on cash and investments held in Trust Account of $1,797,542 and was partially offset by formation and operating costs of $393,475. Liquidity and Capital Resources The Company’s liquidity needs up to June 30, 2026 had been satisfied through a payment from the Sponsor of $25,000 for the founder shares to cover certain offering costs and the proceeds from the IPO and the Private Placement, and Working Capital Loans from Sponsor of $1,208,500 as of June 30, 2026. Following the closing of the IPO and sale of the Private Placement Units on December 6, 2024, a total of $86,250,000 was placed in the Trust Account, and we had $941,835 of cash held outside of the Trust Account available for the payment of accrued offering costs related to the IPO and for working capital purposes. In connection with the IPO, we incurred $2,528,729 in transaction costs, consisting of $1,078,125 underwriting fees, $862,500 of deferred underwriting fees, and $588,104 of other offering costs. As of June 30, 2026, the Company had cash of $352 and a working capital deficit of $1,226,059. For the six months ended June 30, 2026, there was $622,426 of cash used in operating activities resulting from interest and dividend earned on cash and investments held in the Trust Account of $1,540,983. The changes were partially offset by net income of $891,691, an increase in accounts payable and accrued expenses of $10,235, an increase in due to related parties of $272 and a decrease in prepaid expenses of $16,359. For the six months ended June 30, 2025, there was $413,362 of cash used in operating activities resulting from interest and dividend earned on cash and investments held in Trust Account of $1,797,542, and a decrease in due to related parties of $31,188. The changes were partially offset by net income of $1,404,067, a decrease in prepaid expenses of $2,139, and an increase in accounts payable and accrued expenses of $9,162. For the six months ended June 30, 2026, there was $62,305,505 of cash provided by investing activities resulting from proceeds from the sale of investments in the Trust Account of $62,365,505. The change was partially offset by an extension fee deposited into Trust Account of $60,000. For the six months ended June 30, 2025, there were no investing activities. For the six months ended June 30, 2026, there was $61,870,505 of cash used in financing activities resulting from redemptions of Class A Ordinary Shares of $62,365,505. The change was partially offset by the proceeds from a working capital loan from a related party of $495,000. For the six months ended June 30, 2025, there was $175,000 of cash provided by financing activities resulting from the proceeds from working capital loan from a related party. 24 We intend to use the funds held outside the Trust Account to primarily 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. In order to fund working capital deficiencies or finance transaction costs in connection with an initial business combination, our directors, officers and the Sponsor (together, the “Insiders”) or their affiliates or designees may, but are not obligated to, loan us funds as may be required. If the Company completes the initial business combination, it would repay such loaned amounts. In the event that the initial 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 the Trust Account would be used for such repayment. Up to $3,000,000 of such loans (the “Working Capital Loans”) may be convertible into Units of the Company, at a price of $10.00 per Unit (the “Working Capital Units”) at the option of the lender. As of June 30, 2026 and December 31, 2025, the Company had $1,208,500 and $713,500 borrowings under the Working Capital Loans, respectively. We believe we will need to raise additional funds in order to meet the expenditure required for operating our business. 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 initial business combination or because we become obligated to redeem a significant number of our Public Shares upon completion of our initial business combination in which case we may issue additional securities or incur debt in connection with such initial business combination. Off-Balance Sheet Financing Arrangements We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of June 30, 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. Contractual Obligations Registration Rights The holders of the founder shares and Private Placement Units, including any Working Capital Units of those issued upon conversion of Working Capital Loans will be entitled to registration rights pursuant to a registration rights agreement signed on December 4, 2024 by and among the Company and the Insiders. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed after the completion of our initial business combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the costs and expenses of filing any such registration statements. Underwriting Agreement The underwriters received a cash underwriting discount of $0.125 per Public Unit, or $1,078,125 in the aggregate and paid at the closing of the IPO and fully exercised the over-allotment option for 1,125,000 Units. In addition, the underwriters will be entitled to a deferred fee of $0.10 per Public Unit, or approximately $862,500 in the aggregate upon the consummation of an initial business combination. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes its initial business combination, subject to the terms of the underwriting agreement dated December 4, 2024 by and among the Company, SPAC Advisory Partners LLC, and Kingswood Capital Partners, LLC. Critical Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. 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. We did not identify any critical accounting estimates. 25 Recent Accounting Pronouncements 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 unaudited 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 within fiscal years beginning after December 15, 2027, with early adoption permitted. We’re currently evaluating the impact of adopting ASU 2024-03. Management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our unaudited financial statements. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.