Note 14 — Warrant liabilities

The Company issued Public Warrants and Private Warrants in connection with its initial public offering and concurrent private placement. As of June 30, 2026, the Company had 5,750,000 public warrants and 270,500 private warrants outstanding.

The Company accounts for its outstanding Warrants in accordance with ASC 480, “Distinguishing Liabilities from Equity,” and ASC 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity.” The Public Warrants meet the criteria for equity classification and are recorded within shareholders’ equity. The Private Warrants do not meet the criteria for equity classification and are therefore classified as liabilities and measured at fair value at each reporting date, with changes in fair value recognized in the consolidated statements of operations. Management has determined that under the Private Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the Private Warrants as liabilities at their fair value and adjusts the Private Warrants to fair value at each reporting period. Management has further determined that its Public Warrants qualify for equity treatment. Warrant liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statements of operations. The Private Warrants are valued using a Black-Scholes model.

Public Warrants

On June 24, 2021, the Company sold 5,750,000 units at a price of $10.00 per Public Unit in its Initial Public Offering. Each Public Unit consists of one ordinary share of the Company, $0.0001 par value per share, one right and one redeemable warrant (the “Public Warrant”). Each Public Warrant entitles the holder to purchase one-half (1/2) of an ordinary share at an exercise price of $11.50 per whole share, subject to adjustment as described in Form S-1 Amendment No. 2 filed on June 11, 2021. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares. This means that only an even number of warrants may be exercised at any given time by a warrant holder.

The Public Warrants became exercisable on September 16, 2022, the Business Combination date. As of June 30, 2026, the Public Warrants are exercisable for cash as the Company has an effective and current registration statement covering the ordinary shares issuable upon exercise of the Public Warrants. The Public Warrants will expire five years from the consummation of a Business Combination or earlier upon redemption or liquidation.

The Company may call the warrants for redemption (excluding the Private Warrants), in whole and not in part, at a price of $0.01 per warrant:

If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of ordinary shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants.

Subsequent to issuance, the Company effected multiple reverse share splits. In accordance with the terms of the warrant agreement, these events resulted in proportional adjustments to both (i) the exercise price of the warrants and (ii) the number of shares issuable upon exercise of each warrant.

These adjustments increased the exercise price while correspondingly decreasing the number of shares underlying each warrant. As a result, such changes did not alter the economic substance of the warrants.

Private Warrants

Simultaneously with the closing of the Initial Public Offering, the Company consummated a private placement of 270,500 Private Units at $10.0 per unit. The Private Units are identical to the units sold in the Initial Public Offering except that the warrants included in the Private Units (the “Private Warrants”) and the ordinary shares issuable upon the exercise of the Private Warrants will not be transferable, assignable or saleable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable on a cashless basis and will be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

The Private Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the balance sheets. The warrants were classified as Level 3 at the initial measurement date due to the use of unobservable inputs.

The fair value of these warrants, using the Black-Scholes option pricing model, on the date of issuance was $625,000. Variables used in the option-pricing model include (1) risk-free interest rate at the date of grant (0.90%), (2) expected warrant life of 5 years, (3) expected volatility of 58.40%, and (4) expected dividend yield of 0. The Company classifies the Private Warrants as Level 3 instruments within the fair value hierarchy due to the use of unobservable inputs.

The Company’s warrant liabilities amounted to nil and nil as of December 31, 2025 and June 30, 2026.

Fair Value of Private Warrants

As of December 31, 2025 and June 30, 2026, the exercise price of the Private Warrants, after giving effect to adjustments under the warrant agreement, was significantly higher than the market price of the Company’s ordinary shares. Accordingly, the warrants were deeply out-of-the-money.

As a result, the estimated fair value of the Private Warrants was de minimis as of both reporting dates, and the Company has presented the warrant liability as nil in the accompanying consolidated balance sheets.

Changes in Fair Value

The change in fair value of the Private Warrants during the six months ended June 30, 2026 was primarily attributable to (i) the decline in the Company’s share price, (ii) the reduction in the remaining contractual term, and (iii) adjustments to the exercise price resulting from reverse share splits.

The following table summarizes the Company’s Warrants activities and status of Warrants on June 30, 2026: