Exhibit 99.2

 

 

 

AFFINITY ADVISORY NETWORK, LLC and AAN WEALTH ADVISORS, LLC

 

Condensed Combined Financial Statements

 

As of and for the Six Months Ended June 30, 2026

 

 

 

Page 1
 

 

AFFINITY ADVISORY NETWORK, LLC and AAN WEALTH ADVISORS, LLC

 

 

Canton, Ohio

 

CONDENSED COMBINED FINANCIAL STATEMENTS

 

(Unaudited)

 

As of and for the Six Months Ended June 30, 2026

 

Page 2
 

 

Table of Contents

 

Unaudited Condensed Combined Financial Statements:  
   
Balance Sheet as of June 30, 2026 4
   
Statement of Income for the Six Months Ended June 30, 2026 5
   
Statement of Changes in Members’ Deficit for the Six Months Ended June 30, 2026 6
   
Statement of Cash Flows for the Six Months Ended June 30, 2026 7
   
Notes to Unaudited Condensed Combined Financial Statements 8-14

 

Page 3
 

 

Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC

Condensed Combined Balance Sheet

(Unaudited)

 

(in thousands)  June 30, 2026 
     
ASSETS     
Current assets:     
Cash and cash equivalents  $133 
Receivables   260 
Total current assets  $393 
Furniture and equipment, net   — 
Right-of-use assets   168 
Total assets  $561 
      
LIABILITIES AND MEMBERS’ DEFICIT     
      
Current liabilities:     
Accounts payable  $1 
Accrued expenses and other current liabilities   340 
Lease liabilities, current   113 
Total current liabilities  $454 

Line of credit

   261 
Lease liabilities, net of current portion   51 
Total liabilities  $766 
      
Commitments and contingencies (Note 7):     
      
Members’ deficit     
Members’ deficit  $(205)
Total members’ deficit  $(205)
Total liabilities and members’ deficit  $561 

 

See accompanying notes to condensed combined financial statements.

 

Page 4
 

 

Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC

Condensed Combined Statement of Income

(Unaudited)

 

(in thousands) 

For the

Six Months Ended

June 30, 2026

 
     
Revenue:     
Advisory fees  $1,209 
Wealth management fees   505 
Total revenue  $1,714 
      
Cost of services:     
Professional compensation  $156 
Subcontractor and contract labor costs   428 
Total cost of services  $584 
Gross profit  $1,130 
      
Operating expenses:     
General and administrative  $479 
Occupancy and facilities   55 
Marketing and advertising   55 
Total operating expenses  $589 
      
Income from operations  $541 
      
Other expense:     
Interest expense  $21 
Other expense, net   37 
Total other expense, net  $58 
      
Net income  $483 

 

See accompanying notes to condensed combined financial statements.

 

Page 5
 

 

Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC

Condensed Combined Statement of Changes in Members’ Deficit

(Unaudited)

 

For the Six Months Ended June 30, 2026
     
(in thousands)   

Total

Members’ Deficit

 
      
Balance at December 31, 2025  $(360)
      
Members’ draw   (328)
Net income   483 
Balance at June 30, 2026  $(205)

 

See accompanying notes to condensed combined financial statements.

 

Page 6
 

 

Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC

Condensed Combined Statement of Cash Flows

(Unaudited)

 

(in thousands) 

For the Six

Months Ended

June 30, 2026

 
     
CASH FLOWS FROM OPERATING ACTIVITIES:     
Net income  $483 
Adjustments to reconcile net income to net cash provided by operating activities:     
      
Non-cash lease expense   48 
      
Change in operating assets and liabilities:     
Receivables   54 
Accounts payable   1 
Accrued expenses and other current liabilities   (238)
Lease liabilities   (49)
Net cash provided by operating activities  $299 
      
CASH FLOWS FROM FINANCING ACTIVITIES:     
Line of credit, borrowings   20 
Line of credit, repayments   (4)
Members’ draw   (328)
Net cash used in financing activities  $(312)
      
Cash and cash equivalents:     
Net change during the period   (13)
Balance, beginning of period   146 
Balance, end of period  $133 
      
Supplemental cash flow information:     
Cash paid for interest  $21 

 

See accompanying notes to condensed combined financial statements.

 

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Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC

 

Notes to Unaudited Condensed Combined Financial Statements (dollars in thousands)

 

Note 1 — Nature of Operations

 

Founded in 2013, Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC (“Affinity” or the “Company”) supports a nationwide network of agents and advisors serving clients throughout the United States. Affinity’s mission is to develop proprietary advisor training systems, lead generation infrastructure and client relationship management tools designed to support scalable growth and recurring client engagement.

 

The Company delivers integrated retirement, investment, and estate planning solutions through a coordinated model that combines insurance distribution and registered investment advisory.

 

Complementing the insurance offering is AAN Wealth Advisors, LLC, an independent Registered Investment Advisor (“RIA”) that provides fiduciary-based investment management. Through this service, the RIA’s mission is to provide clients with personalized portfolio construction, retirement income planning, and tax-efficient investment strategies.

 

Note 2 — Basis of Presentation and Combination

 

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The Company is a private company that is not required to file financial statements with the Securities and Exchange Commission. All amounts are presented in US dollars.

 

The accompanying condensed combined financial statements have been prepared on a standalone basis and are derived from the historical financial records of Affinity Advisory Network, LLC and AAN Wealth Advisors, LLC. These condensed combined financial statements include the assets, liabilities, equity, revenues, expenses, and cash flows of the two entities under common control and shared management, as listed in Note 1.

 

Because the legal parent-subsidiary relationship did not exist between these entities during the periods presented, these financial statements are presented on a combined rather than consolidated basis. All significant intercompany balances, transactions, and unrealized profits or losses between the combined entities, if any, have been eliminated in full upon combination. The financial information included herein may not necessarily reflect the financial position, results of operations, or cash flows that would have occurred had the combined entities operated as a single, separate standalone enterprise during the period presented.

 

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Note 3 — Summary of Significant Accounting Policies

 

Use of Estimates

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the allowance for credit losses and incremental borrowing rates used to measure lease liabilities. Actual results could differ from those estimates.

 

Cash

 

The Company’s cash consists of demand deposits held at financial institutions.

 

Concentrations of Credit Risk

 

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and receivables. The Company maintains its cash balances at financial institutions where deposits may at times exceed federally insured limits of $250 per depositor, per institution. The Company has not experienced losses on these balances and management believes the Company is not exposed to significant credit risk with respect to cash.

 

Receivables and Allowance for Credit Losses

 

Receivables are stated at the amount the Company expects to collect and do not bear interest. The Company measures expected credit losses over the contractual life of its receivables using a current expected credit loss model. Receivables are pooled based on similar risk characteristics, including client type and aging, and the Company applies loss rates derived from historical write-off experience, adjusted for current conditions and reasonable and supportable forecasts. Receivables are written off when management determines that collection is no longer probable, and subsequent recoveries are credited to the allowance in the period received.

 

Furniture and Equipment

 

Furniture and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs are expensed as incurred, while renewals and betterments that extend the useful life of an asset are capitalized. Upon retirement or disposal, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in operations. Estimated useful lives are as follows:

 

Category   Terms
     
Furniture and Fixtures   5 - 7 years
Computer Equipment   3 - 5 years
Equipment   5 - 7 years

 

Leases

 

The Company determines whether an arrangement is or contains a lease at inception. Operating lease right-of-use assets and lease liabilities are recognized at the commencement date based on the present value of the remaining lease payments over the lease term, and the right-of-use asset is adjusted for prepaid or accrued rent, lease incentives, and initial direct costs. Because the rate implicit in its leases is not readily determinable, the Company uses its incremental borrowing rate. The Company has elected the short-term lease exception and does not record right-of-use assets or lease liabilities for leases with an original term of twelve months or less; such payments are recognized as expense on a straight-line basis over the lease term. Variable lease payments, including common area maintenance and operating cost escalations, are expensed as incurred.

 

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Revenue Recognition

 

The Company accounts for revenue under ASC 606, Revenue from Contracts with Customers. The Company’s revenue consists of advisory fees and wealth management fees. The core principle of ASC 606 is to recognize upon the transfer of promised goods or services to customers in amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. Accordingly, the Company recognizes revenue for services through the application of the following steps:

 

●Identification of the contract, or contracts, with a customer;
●Identification of the performance obligations in the contract;
●Determination of the transaction price;
●Allocation of the transaction price to the performance obligations in the contract; and,
●Recognition of revenue when, or as, the Company satisfies a performance obligation.

 

Advisory Fees. The Company acts as a principal and earns commission revenue from annuity and life insurance policies sold on behalf of its insurance carrier partners for which the Company is designated as the assigned marketing organization. Specifically, the Company earns commission revenue when a submitted annuity and life insurance policy is approved by the carrier and funded, who the Company defines as its customer under ASC 606.

 

The Company receives a one-time commission which is based on the premium amount when the policy is issued and funded by the paying member. Each carrier that the Company considers to be customers have contracted commission tables based on the product selected by the paying member, the age of the paying member and distribution level of the sales organization.

 

The Company also earns trailing commission revenue which is earned over the policy term; however, that amount is immaterial to the financial statements.

 

Wealth Management Fees. The Company acts as a principal and earns investment advisory revenue representing fees charged to clients based on the average daily market value of the assets held in members designated account over the preceding calendar quarter. The Company’s fees are billed quarterly, in arrears. Revenue for investment advisory services is recognized ratably during the quarter. The performance obligation for advisory services is considered a series of distinct services that are substantially the same and are satisfied daily. As the value of the eligible assets in an advisory account is susceptible to changes due to customer activity, this revenue includes variable consideration and is constrained until the date that the fees are determinable. The client accounts are on a calendar quarter and are billed using values as of the last business day of the preceding quarter. The value of the eligible assets in an advisory account on the billing date is adjusted for contributions and withdrawals during the period to determine the amount of revenue earned in the period.

 

Cost of Services

 

Professional compensation

 

Costs of employees directly associated with generating commission revenue are classified as professional compensation in the accompanying condensed combined statement of income.

 

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Subcontractor and contract labor costs

 

Subcontractor and contract labor cost consists of the following: payout amounts that are earned by and paid out to advisors based on advisory and commission revenue earned on each client’s account, production-based bonuses earned by advisors based on the levels of advisory and commission revenue they produce. Costs directly associated with generating commission revenue, including commissions paid to independent producers and affiliated agents, are classified as subcontractor and contract labor cost in the accompanying condensed combined statement of income.

 

Marketing and advertising

 

Marketing and advertising expenses consist primarily of promotional activities associated with the Company’s direct marketing. Direct marketing includes meetings and seminars which are held in the pursuit of attracting new clients. Marketing and advertising costs are expensed as incurred, are included in marketing and advertising in the accompanying condensed combined statement of income, and was approximately $55 for the six months ended June 30, 2026

 

Income Taxes

 

The Company is a limited liability company and consequently, is not a tax-paying entity for United States federal income tax purposes. Accordingly, a provision for income taxes has not been recorded in the accompanying financial statements. Company income or losses are reflected in the members’ individual or corporate tax returns in accordance with their ownership percentages.

 

The Company is required to determine whether its tax positions are more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax benefit recognized is measured as the largest amount of benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement with the relevant taxing authority. De-recognition of a tax benefit previously recognized results in the Company recording a tax liability that reduces member’s equity. Based on its analysis the Company has determined that it has not incurred any liability for unrecognized tax benefits as of June 30, 2026. The Company’s conclusions may be subject to review and adjustment at a later date based on variety of factors including, but not limited to, on-going analysis of and changes to tax laws, regulations and interpretations thereof.

 

The Company recognizes interest and penalties related to unrecognized tax benefits in interest expense and other expenses, respectively. No interest expense or penalties have been recognized for the six months ended June 30, 2026.

 

Fair Value Measurements

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company applies a three-level hierarchy that prioritizes the inputs used to measure fair value: Level 1 inputs are quoted prices in active markets for identical assets or liabilities; Level 2 inputs are observable inputs other than Level 1 prices, such as quoted prices for similar instruments or inputs corroborated by observable market data; and Level 3 inputs are unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use.

 

The Company’s financial instruments consist mainly of cash, receivables, accounts payable, accrued liabilities, the carrying amounts of which approximate fair value because of their short maturities. The carrying value of the line of credit approximates fair value because of the variability of interest rates associated with the instrument.

 

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Note 4 — Receivables and Allowance for Credit Losses

 

Receivables ending balance was $314 at December 31, 2025 and $260 at June 30, 2026.

 

There was a zero balance in allowance for credit losses at December 31, 2025, there was no provision for credit losses and no write-offs charged against credit allowance during the period ending June 30, 2026, netting to a zero balance in allowance for credit losses at June 30, 2026.

 

Note 5 — Furniture and Equipment, Net

 

As of June 30, 2026, furniture and equipment, net consisted of the following:

 

   June 30, 2026 
     
Furniture and fixtures  $278 
Computer equipment   25 
Equipment   22 
    325 
Less: accumulated depreciation   (325)
Furniture and equipment  $- 

 

Furniture and equipment became fully depreciated prior to January 1, 2025 and therefore no depreciation expense was recorded for the six months ended June 30, 2026.

 

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Note 6 — Leases

 

The Company leases office space in Cuyahoga Falls, Ohio and Canton, Ohio, under non-cancelable operating leases with remaining terms of approximately 0.9 years and 1.8 years, respectively, certain of which include options to extend the lease term for five years and three years, respectively. Renewal options are included in the measurement of lease liabilities only when the Company is reasonably certain to exercise them. The Company’s leases do not contain material residual value guarantees or restrictive covenants. The Company has one other short-term lease which is expensed as permitted under the short-term lease exemption. The components of lease cost were as follows:

 

Lease cost 

Six Months Ended

June 30, 2026

 
     
Operating lease cost  $41 
Short-term lease cost   12 
Variable lease cost   1 
      
Total lease cost  $54 

 

As of June 30, 2026, the weighted-average remaining lease term for operating leases was approximately 1.4 years and the weighted-average discount rate was 5.5%. Cash paid for amounts included in the measurement of operating lease liabilities was approximately $55 for the period ended June 30, 2026. Maturities of operating lease liabilities as of June 30, 2026 are as follows:

 

Year Ended 

Future

Minimum Rentals

 
     
Remainder of 2026  $60 
2027   93 
2028   27 
Total undiscounted lease payments   180 
Discount   (16)
Total lease liability  $164 

 

Note 7 — Commitments and Contingencies

 

From time to time the Company is party to claims, disputes, and legal proceedings arising in the ordinary course of business, including matters involving client engagements, employment, and commercial relationships. Management, after consultation with legal counsel, believes that the ultimate resolution of such matters will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows. Accruals for loss contingencies are recorded when a loss is probable and the amount can be reasonably estimated.

 

Note 8 — Line of Credit

 

As of June 30, 2026, the Company maintained a revolving line of credit with Huntington National Bank providing for maximum borrowings of up to $300 secured by substantially all assets of the Company. The maturity date of the line of credit is September 5, 2029. The line of credit was repaid and terminated at the closing of the Affinity acquisition, see Note 10 – Subsequent Events below for discussion of the acquisition.

 

Borrowings under the line bore interest at a variable rate equal to the Index Rate, e.g., Wall Street Journal Prime Rate, plus a margin of 2.0%, adjusted every calendar quarter on the 1st day of the first month of each quarter. The effective interest rate was 8.75% at June 30, 2026.

 

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The outstanding balance on the line of credit was approximately $261 as of June 30, 2026.

 

Note 9 — Concentrations of Revenue

 

The Company derives a significant portion of its revenue from insurance products written through a single insurance company. For the six months ended June 30, 2026, commissions on products written through that insurance company accounted for approximately 77% of total insurance advisory revenues. This concentration reflects the Company’s strategic relationship with its primary carrier partner and does not represent dependence on a single agent or client relationship. These policies are produced by a network of multiple independent agents operating across the country, each writing policies on behalf of their respective clients. The Company maintains relationships with a range of insurance carriers. A significant amount of the Company’s revenue is derived from products purchased by individuals living in Ohio and the Company’s results depend in part on the continued service of a limited number of senior professionals whose client relationships and technical expertise are important to the business. The loss of one or more significant relationships, clients or key personnel could have a material adverse effect on the Company’s results of operations.

 

The Company’s derives a significant portion of its receivables from its wealth management fees. For the six month period ended June 30, 2026, the receivables on the investment service agreement through that one party accounted for approximately 100% of the balance.

 

Note 10 — Subsequent Events

 

On July 15, 2026, Affinity Advisory Holdings Corp., a Delaware corporation (the “Buyer”) and a wholly-owned subsidiary of Stark Novus Financial Inc. (formerly Nu Ride Inc.) (“Stark”) completed the acquisition of Affinity. The Membership Interest Purchase Agreement (the “Purchase Agreement”) for the transaction was signed on June 2, 2026. The aggregate consideration payable under the Purchase Agreement consisted of (a) a cash payment at closing of $6,720, including in respect of $338 of cash on the balance sheet of Affinity at closing; (b) 80,000 shares of Class A common stock of Stark and (c) shares of the Buyer’s common stock equal to 15% of the Buyer’s issued and outstanding shares immediately following the closing. In connection with the closing, outstanding indebtedness of Affinity, including the balance on its revolving line of credit and credit card obligations, was repaid from the cash consideration. The Sellers are also eligible to receive a contingent earnout payment of up to $1,312 (plus accrued interest), payable in up to three annual installments of approximately $437 each following the closing, subject to meeting certain insurance-writing thresholds.

 

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to September 30, 2026, the date that the financial statements were available for issuance. Based upon this review, other than the above, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements.

 

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