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Item 2. Management’s Discussion and Analysis

2025-11-14 compared with 2025-07-31 · 141 added, 119 removed, 149 unchanged (64% of the section changed)

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References in this report

(the “Quarterly Report”) to “we,” “us” or the “Company” refer to YHN Acquisition I

(the “Quarterly Report”) to “we,” “us” or the “Company” refer to YHN Acquisition I Limited.

References to our “management” or our “management team” refer to our officers and directors.

references to the “Sponsor” refer to YHN Partners I Limited.

The following discussion and analysis of the

Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed

consolidated 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.

References to the

“Sponsor” refer to YHN Partners I Limited.

The following discussion and analysis of the Company’s financial condition

and results of operations should be read in conjunction with the unaudited condensed 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

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the sale of the private units, our capital stock, debt or a combination of cash, stock and debt.

On September 19, 2024, we consummated

our initial public offering (“IPO”) of 6,000,000 units (the “Public Units”).

Each Unit consists of one ordinary

share (the “Ordinary Share”) and one right to receive one-tenth (1/10) of one Ordinary Share upon the consummation of an initial

business combination.

The Units were sold at a price of $10.00 per Unit, generating aggregate gross proceeds to the Company of $60,000,000.

On September 19, 2024, we

consummated our initial public offering (“IPO”) of 6,000,000 units (the “Public Units”).

Each Unit consists

of one ordinary share (the “Ordinary Share”) and one right to receive one-tenth (1/10) of one Ordinary Share upon the consummation

of an initial business combination.

The Units were sold at a price of $10.00 per Unit, generating aggregate gross proceeds to the Company

of $60,000,000.

Simultaneously with the closing

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in the Registration Statement) until 180 days after the Company completes its initial business combination.

Our management has broad discretion

with respect to the specific application of the net proceeds of the initial business combination and the Private Placement, although substantially

all of the net proceeds are intended to be applied generally towards consummating a business combination.

On April 3, 2025, we

entered into that certain Business Combination Agreement with Mingde Technology Limited, a Cayman Islands company

(“Mingde”), pursuant to which, (a) immediately prior to the Closing, we will merge with and into YHNA MS I Limited

(“Purchaser” or “PubCo”), our wholly-owned subsidiary, with Purchaser continuing as the surviving entity

(the “Reincorporation Merger”), (b) at the Closing, the parties will effect a merger of Merger Sub, a Cayman Islands

company and wholly owned subsidiary of Purchaser (the “Merger Sub”), formed for the sole purpose of merging with and

into Mingde (the “Acquisition Merger”) in which Mingde will be the surviving entity and a wholly owned subsidiary of

and (c) following the Closing, Purchaser will be a publicly traded company listed on Nasdaq.

Our management has broad

discretion with respect to the specific application of the net proceeds of the initial business combination and the Private Placement,

although substantially all of the net proceeds are intended to be applied generally towards consummating a business combination.

On April 3, 2025, we entered

into that certain Business Combination Agreement with Mingde Technology Limited, a Cayman Islands company (“Mingde”), pursuant

to which, (a) immediately prior to the Closing, we will merge with and into YHNA MS I Limited (“Purchaser”), our wholly-owned

subsidiary, with Purchaser continuing as the surviving entity (the “Reincorporation Merger”), (b) at the Closing, the parties

will effect a merger of Merger Sub, a Cayman Islands company and wholly owned subsidiary of Purchaser (the “Merger Sub”),

formed for the sole purpose of merging with and into Mingde (the “Acquisition Merger”) in which Mingde will be the surviving

entity and a wholly owned subsidiary of Purchaser;

and (c) following the Closing, Purchaser will be a publicly traded company listed on

On May 8, 2025, each of Purchaser,

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conditions of the Business Combination Agreement as though an original party thereto.

On June 3, 2025, each of Purchaser,

Merger Sub, the Company and Mingde executed that certain Amended and Restated Business Combination Agreement (the “Amended and Restated

Business Combination Agreement” or as restated and amended, the “Business Combination Agreement”) to provide for an

earnout mechanism whereby up to an additional $70,000,000 worth of Earnout Consideration Shares may be paid to Mingde shareholders as

contingent post-closing earnout consideration.

As a result, the aggregate consideration for the Acquisition Merger is $326,000,000 plus

up to $70,000,000 worth of Earnout Consideration Shares.

The Merger Consideration will be paid in the form of (1) 32,600,000 newly issued

PubCo Ordinary Shares valued at $10.00 per share, which are comprised of (A) 30,970,000 PubCo Ordinary Shares as the Closing Payment Shares

and (B) 1,630,000 PubCo Ordinary Shares to be issued to the Mingde shareholders at the Closing and held back as security for Mingde’s

On June 3, 2025, each of

Purchaser, Merger Sub, the Company and Mingde executed that certain Amended and Restated Business Combination Agreement (the “Amended

and Restated Business Combination Agreement” or as restated and amended, the “Business Combination Agreement”) to provide

for an earnout mechanism whereby up to an additional $70,000,000 worth of Earnout Consideration Shares may be paid to Mingde shareholders

as contingent post-closing earnout consideration.

As a result, the aggregate consideration for the Acquisition Merger is $326,000,000

plus up to $70,000,000 worth of Earnout Consideration Shares.

The Merger Consideration will be paid in the form of (1) 32,600,000 newly

issued PubCo Ordinary Shares valued at $10.00 per share, which are comprised of (A) 30,970,000 PubCo Ordinary Shares as the Closing Payment

Shares and (B) 1,630,000 PubCo Ordinary Shares to be issued to the Mingde shareholders at the Closing and held back as security for Mingde’s

representations and warranties as further set forth in Article XI of the Business Combination Agreement as the Holdback Shares;

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to the earnout mechanism.

On November 7, 2025, the

parties to the Amended and Restated Business Combination Agreement enter into Amendment No.1 to Amended and Restated Business Combination

Agreement (the “Amendment No.

1”), which serves to adjust the Merger Consideration and the contingency basis of the Earnout

Consideration from future revenue performance to post-closing share price performance of the Purchaser Ordinary Shares.

As a result, the

aggregate consideration for the Acquisition Merger is $280,000,000 plus up to $80,000,000 worth of Earnout Consideration Shares.

Consideration will be paid in the form of (1) 20,000,0000 newly issued PubCo Ordinary Shares valued at $10.00 per share, which are comprised

of (A) 19,000,000 PubCo Ordinary Shares as the Closing Payment Shares and (B) 1,000,000 PubCo Ordinary Shares to be issued to the Mingde

Shareholders at the Closing and held back as security for the Mingde’s representations and warranties as further set forth in Article

XI of the Business Combination Agreement as the Holdback Shares;

and (2) an addition of up to 8,000,000 PubCo Ordinary Shares valued at

$10.00 per share as contingent post-closing earnout consideration subject to the earnout mechanism.

Results of Operations

Our entire activity from inception

up to September 19, 2024 was in preparation for the initial public offering.

Since the initial public offering, our activity has been

limited to the evaluation of business combination candidates, and we will not be generating any operating revenues until the closing and

completion of our initial business combination.

We expect to incur increased expenses as a result of being a public company (for legal,

financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

We expect our expenses to increase substantially

after this period.

For the six months ended June

30, 2025, we had a net income of $522,549 which was comprised of formation and operating costs expenses, dividend income and interest

For the six months ended June

30, 2024, we had a net loss of $41,510 which was comprised of formation and operating costs expenses, dividend income and interest income.

For the three months ended June

30, 2025, we had a net loss of $24,750 which was comprised of formation and operating costs expenses, dividend income and interest income.

For the three

months ended June 30, 2024 we had a net loss of $16,164 which was comprised of formation and operating costs expenses and other income.

Our entire activity from

inception up to September 19, 2024 was in preparation for the initial public offering.

Since the initial public offering, our activity

has been limited to the evaluation of business combination candidates, and we will not be generating any operating revenues until the

closing and completion of our initial business combination.

We expect to incur increased expenses as a result of being a public company

(for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

We expect our expenses to

increase substantially after this period.

the nine months ended September 30, 2025, we had a net income of $1,041,201 which was comprised of formation and operating costs expenses,

dividend income and interest income.

the nine months ended September 30, 2024, we had a net loss of $17,788 which was comprised of formation and operating costs expenses,

dividend income and interest income.

the three months ended September 30, 2025, we had a net income of $518,652 which was comprised of formation and operating costs expenses,

dividend income and interest income.

the three months ended September 30, 2024 we had a net income of $23,722 which was comprised of formation and operating costs expenses,

dividend income and interest income.

Liquidity and Capital Resources

of June 30, 2025, we had cash of $47,849.

Until the consummation of the initial public offering, the only source of liquidity was an initial

purchase of ordinary shares by our Sponsor, monies loaned by the Sponsor under a certain unsecured promissory note and advances from our

On September 19, 2024, we consummated

the Initial Public Offering of 6,000,000 units (the “Public Units”), at $10.00 per Public Unit, generating gross proceeds

of $60,000,000.

Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 250,000 Private Units at a

price of $10.00 per unit in the Private Placement, generating gross proceeds of $2,500,000.

Transaction costs amounted to

$2,840,203, consisting of $960,000 of underwriting fees, $1,500,000 of deferred underwriting fees and $380,203 of other offering costs.

As of September 30,

2025, we had cash of $95,142.

Until the consummation of the initial public offering, the only source of liquidity was an initial purchase

of ordinary shares by our Sponsor, monies loaned by the Sponsor under a certain unsecured promissory note and advances from our Sponsor.

On September 19, 2024, we

consummated the Initial Public Offering of 6,000,000 units (the “Public Units”), at $10.00 per Public Unit, generating gross

proceeds of $60,000,000.

Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 250,000 Private Units

at a price of $10.00 per unit in the Private Placement, generating gross proceeds of $2,500,000.

Transaction costs amounted

to $2,840,203, consisting of $960,000 of underwriting fees, $1,500,000 of deferred underwriting fees and $380,203 of other offering costs.

In addition, at September 19, 2024, cash of $737,704 were held outside of the Trust Account and is available for working capital purposes

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and pursue our growth strategies.

Prior to the completion of our

initial business combination, we will have available to us approximately $750,000 of proceeds held outside the trust account.

Prior to the completion of

our initial business combination, we will have available to us approximately $750,000 of proceeds held outside the trust account.

use these funds to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to

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may not be able to obtain additional financing.

If the Company is unable to raise additional capital, it may be required to take

additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending

the pursuit of a potential transaction, and reducing overhead expenses.

The Company cannot provide any assurance that new financing

will be available to it on commercially acceptable terms, if at all.

These conditions raise substantial doubt about the

Company’s ability to continue as a going concern if a business combination is not consummated by December 18, 2025.

unaudited condensed consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets

or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

If the Company is unable to raise additional capital, it may be required to take additional

measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit

of a potential transaction, and reducing overhead expenses.

The Company cannot provide any assurance that new financing will be available

to it on commercially acceptable terms, if at all.

These conditions raise substantial doubt about the Company’s ability to continue

as a going concern if a business combination is not consummated by December 18, 2025.

These unaudited condensed financial statements do

not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary

should the Company be unable to continue as a going concern.

Off-balance Sheet Financing Arrangements

have no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of June 30, 2025.

have no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of September 30, 2025.

do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to

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Ordinary shares subject to possible redemption

The Company accounts for its

ordinary shares subject to possible redemption in accordance with the guidance in FASB ASC 480, “ Distinguishing Liabilities

from Equity ”.

Ordinary share subject to mandatory redemption (if any) is classified as a liability instrument and is measured

at fair value.

Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within

the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control)

are classified as temporary equity.

The Company accounts for its ordinary shares subject

to possible redemption in accordance with the guidance in FASB ASC 480, “Distinguishing Liabilities from Equity”.

share subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value.

Conditionally redeemable

ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject

to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity.

At all other times, ordinary shares are classified as shareholders’ equity.

Accordingly, as

of June 30, 2025 and December 31, 2024, 6,000,000 and 6,000,000 ordinary shares subject to possible redemption are

presented at redemption value as temporary equity, outside of the shareholders’ deficit section of the Company’s unaudited

condensed balance sheets, respectively.

If it is probable that the equity instrument will become redeemable, the Company has the option

to either accrete changes in the redemption value over the period from the date of issuance (or from the date that it becomes probable

that the instrument will become redeemable, if later) to the earliest redemption date of the instrument or to recognize changes in the

redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of

each reporting period.

The Company has elected to recognize the changes immediately.

The accretion or remeasurement is treated as a deemed

dividend (i.e., a reduction to retained earnings, or in absence of retained earnings, additional paid-in capital).

As of June 30, 2025 and

December 31, 2024, the ordinary shares subject to possible redemption reflected on the unaudited condensed consolidated balance

sheets are disclosed in the following table:

Accordingly, as of September 30, 2025 and December 31,

2024, 6,000,000 and 6,000,000 ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside

of the shareholders’ deficit section of the Company’s unaudited condensed consolidated balance sheets, respectively.

is probable that the equity instrument will become redeemable, the Company has the option to either accrete changes in the redemption

value over the period from the date of issuance (or from the date that it becomes probable that the instrument will become redeemable,

if later) to the earliest redemption date of the instrument or to recognize changes in the redemption value immediately as they occur

and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting period.

The Company has elected

to recognize the changes immediately.

The accretion or remeasurement is treated as a deemed dividend (i.e., a reduction to retained earnings,

or in absence of retained earnings, additional paid-in capital).

As of September 30, 2025

and December 31, 2024, the ordinary shares subject to possible redemption reflected on the unaudited condensed consolidated balance sheets

are disclosed in the following table:

Gross proceeds

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Subsequent remeasurement of ordinary shares subject to possible redemption - 2025

Ordinary shares subject to possible redemption as of June 30, 2025

Net loss per share

Company calculates net income (loss) per share in accordance with ASC Topic 260, “Earnings per Share”.

order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered

the undistributed income (loss) allocable to both the redeemable ordinary shares and non-redeemable ordinary shares and the undistributed

income (loss) is calculated using the total net income (loss) less any dividends paid.

The Company then allocated the undistributed income

(loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable ordinary shares.

remeasurement of the accretion to the redemption value of the ordinary shares subject to possible redemption was considered to be dividends

paid to the public stockholders.

Accretion associated with the redeemable shares of ordinary share is excluded from earnings per share

as the redemption value approximates fair value.

net income (loss) per share presented in the unaudited condensed consolidated statements of operations is based on the

Ordinary shares subject to possible redemption as of September 30, 2025

Net income (loss) per share

calculates net income (loss) per share in accordance with ASC Topic 260, “Earnings per Share” .

In order to determine

the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed

income (loss) allocable to both the redeemable ordinary shares and non-redeemable ordinary shares and the undistributed income (loss)

is calculated using the total net income (loss) less any dividends paid.

The Company then allocated the undistributed income (loss) ratably

based on the weighted average number of shares outstanding between the redeemable and non-redeemable ordinary shares.

Any remeasurement

of the accretion to the redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to

the public stockholders.

Accretion associated with the redeemable shares of ordinary share is excluded from earnings per share as the

redemption value approximates fair value.

(loss) per share is presented in the unaudited condensed consolidated statements of operations as follows:

For the Three Months ended

June 30, 2025

September 30, 2025

For the Three Months ended

June 30, 2024

Non-Redeemable Ordinary Shares

September 30, 2024

Ordinary Shares

Non-Redeemable Ordinary Shares

Non-Redeemable

Ordinary Share

Non-Redeemable

Ordinary Share

Basic and diluted net income (loss) per share:

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Basic and diluted net income (loss) per share

For the Six Months ended

June 30, 2025

For the Six Months ended

June 30, 2024

Non-Redeemable Ordinary Shares

For the Nine Months ended

September 30, 2025

For the Nine Months ended

September 30, 2024

Ordinary Shares

Non-Redeemable Ordinary Shares

Non-Redeemable

Ordinary Share

Non-Redeemable

Ordinary Share

Basic and diluted net income (loss) per share:

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis