Note 5 — Related Party Transactions

Founder Shares

On August 18, 2025, the Company issued 5,750,000 founder shares to the Sponsor in exchange for a capital contribution of $25,000, or approximately $0.004 per share, to cover certain of the Company’s expenses. 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 underwriters’ over-allotment would be exercised. On January 23, 2026, the underwriters partially exercised their over-allotment option and the sale of Units pursuant thereto was consummated on January 26, 2026, resulting in 625,000 founder shares no longer subject to forfeiture. The remaining underwriters’ over-allotment option expired on March 6, 2026, resulting in 125,000 founder shares being forfeited to the Company.

On January 22, 2026, the Sponsor granted membership interests equivalent to an aggregate of 160,000 founder shares to the independent directors of the Company. The membership interests in founder shares granted to the independent directors are in the scope of FASB ASC Topic 718. Under FASB ASC Topic 718, stock-based compensation associated with equity-classified awards is measured at fair value on the assignment date. The founder shares have an aggregate fair value of $393,600 or $2.46 per share. The Company recognized stock-based compensation expense of $393,600 on January 22, 2026. The Company established the fair value of founder shares using Monte Carlo Simulation Model prepared by a third-party valuation firm, which takes into consideration the following market assumptions; (i) implied share price of $9.85, and (ii) probability of De-SPAC and instrument-specific market adjustment of 25.0%.

With certain limited exceptions, the Company’s initial shareholders 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) 180 days 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 the Company’s initial shareholders with respect to any founder shares.

Promissory Note — Related Party

On August 5, 2025, the Sponsor had agreed to loan the Company an aggregate of up to $400,000 to be used for a portion of the expenses of the Initial Public Offering. The loan was non-interest bearing, unsecured and due at the earlier of November 1, 2026, the date on which the Company consummates the Initial Public Offering, or the date on which the Company determines not to proceed with the Initial Public Offering. The Company had borrowed $286,183 under the promissory note, which was repaid at the closing of the Initial Public Offering on January 22, 2026. Borrowings under the note are no longer available.

Due from Sponsor

On January 22, 2026, the Company repaid the Promissory Note to the Sponsor but in excess of the outstanding balance by $25,461. The Sponsor paid the Company $25,461 to refund the overpayment on January 27, 2026. As of June 30, 2026, the Company was owed $375,000 from the Sponsor, which amount is reflected in “Due from Sponsor” on the accompanying condensed balance sheets.

X3 ACQUISITION CORP. LTD.

NOTES TO CONDENSED FINANCIAL STATEMENTS

JUNE 30, 2026

(UNAUDITED)

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. 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 amounts 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. These warrants would be identical to the Private Placement Warrants. As of June 30, 2026, no such Working Capital Loans were outstanding.

Administrative Services Agreement

Commencing on January 20, 2026, the Company entered into an agreement with the Sponsor or an affiliate to pay an aggregate of $10,000 per month for office space, utilities and secretarial and administrative support. These monthly fees will cease upon the completion of the initial Business Combination or the liquidation of the Company. For the three and six months ended June 30, 2026, there have been $30,000 and $51,000, respectively, incurred of administrative services fees which were included in accrued expenses in the accompanying condensed balance sheets.