Basis of Presentation

The accompanying unaudited financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission and in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations and should be read in conjunction with the Company’s latest audited annual financial statements.

In the opinion of the Company, the accompanying unaudited financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of March 31, 2026, and December 31, 2025, and its results of operations for the three months ended March 31, 2026, and March 31, 2025, and cash flows for the three months ended March 31, 2026, and March 31, 2025.

Based on the Company’s expense sharing arrangement with Ultimate Parent (see Note 6), the funds provided under that arrangement will be sufficient to fund anticipated operating expenses for at least twelve months from the date on which the financial statements were available for issuance.

Cash

All cash was cash on hand and is carried in the financial statements at amounts which approximates its fair value.

Net Loss per Share

Basic net loss per common share is calculated by dividing net loss applicable to common stockholder by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is calculated by increasing the denominator by the weighted-average number of additional shares that could have been outstanding from securities convertible into common stock, such as stock options, unless their effect on net loss per share is antidilutive.

Income Taxes

The Company is treated as a subchapter C corporation and, therefore, is subject to both federal and state income taxes. Ultimate Parent continues to be recognized as a limited liability company, a pass-through entity for income tax purposes.

The Company has had no income tax expense due to operating losses incurred since inception. ASC 740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more-likely-than-not that some portion or all the deferred tax assets will not be realized. The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. Based on this, the Company has provided a valuation allowance for the full amount of the net deferred tax assets as the realization of the deferred tax assets is not determined to be more likely than not.

The Company follows the provisions of ASC 740-10, Accounting for Uncertainty in Income Taxes, which specifies how tax benefits for uncertain tax positions are to be recognized, measured, and recorded in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim period guidance, among other provisions. As of March 31, 2026, and December 31, 2025, the Company has not recorded tax reserves associated with any unrecognized tax benefits. The Company’s policy is to recognize interest and penalties accrued on any uncertain tax positions as a component of income tax expense, if any, in its statements of income. As of March 31, 2026, and December 31, 2025, the Company had no reserves for uncertain tax positions.

The Company’s federal income tax returns for the years ended December 31, 2022, to December 31, 2025, remain open and are subject to examination by the Internal Revenue Service and state taxing authorities.

Accounting Pronouncements Adopted During the Current Year

In July 2025, the FASB issued ASU 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets. The standard relates to estimating credit losses under CECL for current accounts receivable and current contract assets arising from revenue transactions accounted for under ASC 606, Revenue from Contracts with Customers, including those acquired in a transaction accounted for under ASC 805, Business Combinations. The standard does not apply to other types of accounts receivable and loans. The standard provides a practical expedient to assume that current conditions as of the balance sheet date will persist through the reasonable and supportable forecast period for eligible assets. Entities will still be required to adjust historical data used in the estimation to reflect current conditions. If elected, the practical expedient must be applied consistently to all eligible current accounts receivable and current contract assets. The Company adopted this standard on January 1, 2026, on a prospective basis. There was no impact on the Company’s financial statements or footnote disclosures as a result of adopting the practical expedient.

Recently Issued Accounting Pronouncements - Not yet Adopted

In December 2025, the FASB issued ASU 2025-11, Interim Reporting. The standard clarifies interim disclosure requirements and requires entities to disclose events since the end of the last annual reporting period that have had a material impact on the entity. The new guidance will be effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, and is to be adopted on a prospective basis. Early adoption is permitted and may be applied either prospectively or retrospectively. The Company is currently evaluating ASU 2025-11 to determine its impact on financial and footnote disclosures.

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In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The standard is intended to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, selling, general, and administrative, and research and development). The amendments will require public entities or private companies that are in the process of going public to disclose specific types of expenses included in the expense captions presented on the face of the income statement, as well as disclosures about selling expenses. The new standard is effective for the Company’s annual periods beginning January 1, 2027, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating this standard to determine its impact on the financial statements and footnote disclosures.

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