Promissory Note, Sponsor Transition Agreement & Extension Advance Note |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Promissory Note, Sponsor Transition Agreement & Extension Advance Note [Abstract] | |
| PROMISSORY NOTE, SPONSOR TRANSITION AGREEMENT & EXTENSION ADVANCE NOTE | NOTE 6 — PROMISSORY NOTE, SPONSOR TRANSITION AGREEMENT & EXTENSION ADVANCE NOTE
On March 23, 2026, the Company issued an interim convertible note (the “Interim Note”) to the Investor in the principal amount of $100,000 (the “Interim Loan”). The Interim Loan represents an initial loan towards a contemplated $500,000 financing (the “Financing”) pursuant to the Definitive Interim Investment and Sponsor Transition Agreement dated March 23, 2026 (the “Investment Agreement”) described below. As of June 30, 2026, there was $350,000 outstanding under the Interim Note.
The Interim Note has a maturity date six months from the date of issuance, unless earlier converted or credited toward the definitive financing under the Investment Agreement and does not bear interest. Upon the consummation of initial business combination by the Company (a “Business Combination”), the outstanding principal amount of the Interim Loan may, at the option of the Investor, be converted into shares of the combined entity at a conversion price equal to a 35% discount to the market price of such shares at the time of conversion.
On March 23, 2026, the Company entered into the Definitive Interim Investment and Sponsor Transition Agreement, (the “Investment Agreement”) with the Investor relating to a proposed financing transaction pursuant to which the Investor indicated its intent to provide financing to the Company through a convertible note investment, of which the Interim Loan represented the first tranche. Pursuant to the Investment Agreement, the aggregate amount to be loaned is $500,000. The second tranche of $200,000 will be made within 21 days with the remainder of the commitment on an as-needed basis. The Company also agreed to use commercially reasonable efforts to provide the Investor with not less than 40% of the economic benefit equivalent to sponsor-level economics. The Investor has the right but not the obligation to provide additional funding beyond the $500,000 commitment. As of June 30, 2026, the Investor has not received the economic benefit equivalent to sponsor-level economics in any amount.
The Company and the Investor have entered into extension advance notes (the “Extension Advance Notes”) pursuant to which the Investor’s extension deposits, which is the lessor of $300,000 or $0.04 per non-redeemed public share, are repayable to the Investor at or following the closing of the Company’s business combination. In lieu of reimbursement, the Investor may elect, in its sole discretion and by written notice given at or prior to the closing, to convert the principal amount of the Extension Advance Notes into ordinary shares of the post-combination company at a price per share equal to the Reference Price, as defined in Omnibus Amendment No. 3 to the Merger Agreement and as it may be amended.
The Extension Advance Notes are issued in respect of extension funding provided under the Investment, under which the Investor has the right, but not the obligation, to provide additional financing including extension funding. Amounts advanced under the Extension Advance Notes are additional to, and shall not be credited against, the Investor’s commitment of up to $500,000 under the Investment Agreement, which is separately evidenced by the Interim Convertible Notes.
The Investor has made two deposits of $300,000, or $600,000 in the aggregate, during the three and six months ended June 30, 2026, resulting in an Extension Advance Notes balance of $600,000 as of June 30, 2026. |