NOTE 5 — RELATED PARTY TRANSACTIONS

Founder Shares

On February 21, 2024, the Sponsor made a capital contribution of $25,000, or approximately $0.004 per share, to cover certain of the Company’s expenses, for which the Company issued 5,750,000 of the Company’s Class B ordinary shares, par value $0.0001 per share (the “Class B Ordinary Shares”, and together with the Class A Ordinary Shares, the “Ordinary Shares”), to the Sponsor (such shares, the “Founder Shares”). Up to 750,000 of the Founder Shares were subject to surrender by the Sponsor for no consideration depending on the extent to which the Over-Allotment Option was exercised. On July 15, 2024, the Underwriters exercised their Over-Allotment Option in full as part of the closing of the Initial Public Offering. As such, the 750,000 Founder Shares are no longer subject to forfeiture.

The holders of the Founder Shares have agreed not to transfer, assign or sell any of their Founder Shares and any Class A Ordinary Shares issued upon conversion thereof until the earlier to occur of (i) one year after the completion of the initial Business Combination or (ii) the date on which the Company completes a liquidation, merger, share exchange or other similar transaction after the initial Business Combination that results in all of the Company’s shareholders having the right to exchange their Class A Ordinary Shares for cash, securities or other property. Any permitted transferees will be subject to the same restrictions and other agreements of such holders of the Founder Shares with respect to any Founder Shares (the “Lock-up”). Notwithstanding the foregoing, if (x) the closing price of the Class A Ordinary Shares equals or exceeds $12.00 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 at least 150 days after the initial Business Combination or (y) if the Company consummates a transaction after the initial Business Combination that results in the Company’s shareholders having the right to exchange their Ordinary Shares for cash, securities or other property, the Founder Shares will be released from the Lock-up.

IPO Promissory Note — Related Party

The Sponsor agreed to loan the Company an aggregate of up to $340,000, to be used for a portion of the expenses of the Initial Public Offering pursuant to an unsecured promissory note (as amended, the “IPO Promissory Note”). The loan was non-interest bearing, unsecured and due at the earlier of December 31, 2024, or the closing of the Initial Public Offering. Since inception through the Initial Public Offering, the Company had borrowed $307,974 under the IPO Promissory Note. The Company repaid $335,314 on July 15, 2024.

Due from Sponsor

The Company paid the Sponsor an amount $27,340 in excess of the outstanding IPO Promissory Note balance at the closing of the Initial Public Offering. The excess payment of $27,340 is due to the Company as of March 31, 2026 and December 31, 2025.

Administrative Services Agreement

The Company entered into an administrative services agreement, commencing on July 11, 2024, through the earlier of consummation of the initial Business Combination and the Company’s liquidation, to pay an affiliate of the Sponsor $12,500 per month for office space, utilities and secretarial and administrative support services provided to members of Management. For the three months ended March 31, 2026, the Company incurred $37,500 in fees for these services, of which the amount is included in accrued expenses in the accompanying unaudited condensed balance sheets. For the three months ended March 31, 2025, the Company incurred and paid $37,500 in fees for these services.

Working Capital 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 (the “Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans. In the event that a Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay the Working Capital Loans, but no proceeds from the Trust Account would be used to repay the Working Capital Loans. Up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the Private Placement Warrants. As of March 31, 2026 and December 31, 2025, there was a total amount of $500,000 and $0, respectively, outstanding under the Working Capital Note (as defined below).

Working Capital Promissory Note 

In light of the Company’s limited cash balance at year end, the Board and Management determined to secure additional working capital to fund past and ongoing operational expenses. On March 20, 2026, the Company entered into a promissory note (the “Working Capital Note”) with the Sponsor, pursuant to which the Sponsor may loan up to $1,000,000 to the Company in up to three tranches in substantially the same amounts and on substantially the same terms as the loans under that certain agreement, between the Sponsor and Keystone Capital Partners, LLC (“Keystone”), as agent for the lenders party thereto (the “Lenders” and such agreement, the “Credit Agreement”), including an initial loan to the Company of $500,000 upon execution and two additional loans of $250,000 each (in the case of the Working Capital Note, at the Sponsor’s sole election) in the event that the Company (A) enter into a letter of intent, memorandum of understanding or other agreement with respect to a Business Combination or (B) call a shareholder meeting to extend the Combination Period, (i) an original issue discount of 20% on each loan, such that the principal amount of each loan is 125% of the amount borrowed, (ii) annual interest of 8%, with a default interest rate of an additional 18% (for a total of 26%), to the maximum extent permitted by applicable law, (iii) a prepayment penalty of 10% (and in the case of the Working Capital Note, only to the extent with the written consent of the Sponsor), (iv) a maturity date for all such loans, interest and other obligations under the Working Capital Note of the consummation of our initial Business Combination or the effective date of the Company’s winding up (or if earlier, upon an event of default), and (v) an obligation to reimburse the Sponsor for its expenses in connection with obtaining the funds for the initial loan under the Working Capital Note (up to $25,000 to be withheld at the funding of the initial loan, which will be used to reimburse Keystone for its expenses under the Credit Agreement) and for any expenses of the Sponsor in connection with any refinancing of the debt or the enforcement of the Working Capital Note and for any reimbursement or indemnification obligations of the Sponsor under the Credit Agreement and related documents, subject in each case to a cap of $20,000 per occurrence (other than with respect to indemnification obligations), which expense reimbursement obligations will be taken out of the proceeds of any additional loans under the Working Capital Note or otherwise upon the maturity date (or earlier event of default). As of March 31, 2026, the Company had received $500,000 under the Working Capital Note. No interest was accrued as of March 31, 2026, as the amount was de minimis. 

Credit and Pledge Agreements

In connection with the Working Capital Note, the Sponsor entered into the Credit Agreement, pursuant to which the Lenders agreed to provide loans to the Sponsor of up to $1,000,000 in the aggregate, to be funded in up to three tranches, consisting of an initial loan of $500,000 and two additional loans of $250,000 each (with such additional tranches subject to the consent of Keystone, not to be unreasonably withheld, delayed or conditioned), in each case subject to the terms and conditions of the Credit Agreement. In connection with the Credit Agreement, the Sponsor also entered into a Pledge Agreement (the “Pledge Agreement”) with Keystone, pursuant to which the Sponsor pledged 2,932,500 Class B Ordinary Shares (representing approximately 51% of the Founder Shares owned by the Sponsor), together with any proceeds thereof (the “Pledged Collateral”), as collateral to secure the obligations under the Credit Agreement. The loans under the Credit Agreement are non-recourse to the Sponsor, and the Lenders’ sole recourse in the event of a default is to foreclose upon such Pledged Collateral, which would remain subject to the Company’s governing documents and applicable lock-up arrangements, including the terms of the Letter Agreement. The Sponsor is required to use the proceeds of the loans under the Credit Agreement to fund loans to the Company to pay for its expenses, including transaction expenses for future deals, amounts previously owed for prior Business Combination efforts and for administrative expenses. The loans under the Credit Agreement mature upon the earlier of the Company’s initial Business Combination or the Company’s liquidation. The Credit Agreement includes events of default for the Company’s failure to file with the SEC by a certain agreed upon date a proxy statement to call for a shareholder meeting to extend the Company deadline to consummate an initial Business Combination or for the Company’s failure to enter into a definitive Business Combination agreement with a target company or business prior to a certain agreed upon date. However, the Credit Agreement and Pledge Agreement solely bind the Sponsor and do not restrict the Company’s actions.

The Company, the Sponsor and Cantor, also entered into a waiver letter pursuant to which the restrictions on transfers contained in the Letter Agreement were waived solely to permit the pledge of the Pledged Collateral and any transfer thereof upon enforcement of the related security interest, but with the Lenders taking such Pledged Collateral subject to the terms of the Letter Agreement.