{"url_path":"/sec/pmvcw/10-q/2026/item-1a","section_key":"item-1a","section_title":"Item 1A Risk Factors.","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-14","source_url":"https://www.sec.gov/Archives/edgar/data/1807765/0001213900-26-056585-index.html","accession_number":"0001213900-26-056585","cik":"0001807765","ticker":"PMVC","issuer_name":"PMV Consumer Acquisition Corp.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1807765/0001213900-26-056585-index.html","primary_entity_key":"0001807765","primary_entity_name":"PMV Consumer Acquisition Corp."},"word_count":10492,"has_tables":true,"body_markdown":"Item 1A. Risk Factors.\n\n \n\nIn addition to the other information set forth\nin this Quarterly Report on Form 10-Q, you should carefully consider the risks discussed in Part I, Item 1A “Risk Factors”\nin our Form 10-K filed with the SEC on March 25, 2026, for the year ended December 31, 2025.\n\n \n\nYou should understand that an investment in our\nsecurities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in this section “Risk\nFactors,” alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition\nand operating results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment.\nThe following is a summary of some of the risks and uncertainties that could materially adversely affect our business, financial condition\nand results of operations. You should read this summary together with the more detailed description of each risk factor incorporated\nby reference or contained herein below.\n\n \n\n*Summary of Risk Factors*\n\n \n\n \n●\nOur public stockholders\nare relying on management to locate a suitable business opportunity. We may not be successful in identifying a suitable business\nopportunity and, even if one is identified, no assurance can be provided that we will successfully negotiate and consummate a transaction.\n\n  \n\n \n●\nOur executive officers\nand directors will allocate their time to other businesses, thereby causing conflicts of interest in their determination as to how\nmuch time to devote to our affairs. This conflict of interest could have a negative impact on our ability to identify a business\nopportunity and complete a transaction.\n\n \n\n \n●\nCertain of our executive\nofficers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities\nsimilar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a\nparticular business opportunity should be presented.\n\n \n\n \n●\nOur limited resources may\nmake our financial condition unattractive to potential business opportunities, which may make it difficult for us to enter into a\ntransaction.\n\n \n\n \n●\nWe may engage in a business\nopportunity with one or more businesses or entities that have relationships with entities that may be affiliated with our Sponsor,\nexecutive officers and directors, which may raise potential conflicts of interest.\n\n \n\n \n●\nWe will likely only be\nable to complete one business opportunity, which will cause us to be solely dependent on a single business which may have a limited\nnumber of products or services. This lack of diversification may negatively impact our operations and profitability.\n\n \n\n \n●\nOur warrants are accounted\nfor as liabilities and changes in the value of our warrants could have a material effect on our financial results.\n\n \n\nThe risk factors set forth below provide more\ndetailed disclosure of the risks relating to our operations.\n\n* *\n\n*We are a recently formed company with no\noperating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.*\n\n \n\nWe are a recently formed company with no operating\nresults. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objectives.\nWe have no plans, arrangements or understandings with respect to any business opportunity and may be unable to complete a transaction.\nIf we fail to complete a transaction, we may never generate any operating revenues.\n\n* *\n\n*If we elect to take advantage of the controlled\ncompany standards, we would be exempt from various corporate governance requirements.*\n\n \n\nCertain listing rules generally define a “Controlled\nCompany” as any company of which more than 50% of the voting power for the election of directors is held by an individual, a group\nor another company. Only holders of the Founder Shares will have the right to vote on the election of directors. More than 50% of the\nFounder Shares are held by our Sponsor. Accordingly, we satisfy the definition of being a controlled company. We may in the future elect\nto take advantage of the controlled company standards, pursuant to which we would be exempt from various corporate governance requirements,\nsuch as the requirement to have a majority of independent directors and to have nominating/corporate governance and compensation committees\ncomprised entirely of independent directors.\n\n \n\n22\n\n \n\n \n\n*Because of our limited resources and the\nsignificant competition for business opportunities, it may be more difficult for us to complete a transaction and our warrants may expire\nworthless.*\n\n \n\nWe expect to encounter intense competition from\nother entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships),\nblank check companies and other entities, domestic and international, competing for the types of business opportunities we intend to\npursue. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting,\ndirectly or indirectly, such business opportunities and/or operating in or providing services to various industries. Many of these competitors\npossess greater technical, human and other resources or more industry knowledge than we do and our financial resources will be relatively\nlimited when contrasted with those of many of these competitors. While we believe there are numerous business opportunities we could\npotentially pursue, our ability to compete for such business opportunities will be limited by our available financial resources. This\ninherent competitive limitation gives others an advantage in pursuing the acquisition of certain business opportunities.\n\n \n\n*Holders of Class A common stock (fka Class\nC common stock) will not be entitled to vote on any election of directors we hold.*\n\n \n\nOnly holders of our Founder Shares will have\nthe right to vote on the election of directors. Holders of our public shares will not be entitled to vote on the election of directors.\nAccordingly, you may not have any say in the management of our company.\n\n* *\n\n*Holders of Class B common stock will be\nentitled to ten (10) votes for each such share.*\n\n \n\nHolders of Class B common stock will be entitled\nto ten (10) votes for each such share at any annual or special meeting of stockholders or in the case of any written consent of stockholders\nin lieu of a meeting and for all purposes. Holders of our public shares will be entitled to one vote for each such share held. Accordingly,\nholders of Founder Shares may exert an outsized influence on each matter properly submitted to the stockholders on which holders of the\ncommon stock are entitled to vote.\n\n* *\n\n*Because we are neither limited to evaluating\na business opportunity in a particular industry sector nor have we selected any specific business opportunities with which to pursue\na transaction, you are unable to currently ascertain the merits or risks of any particular business opportunity.*\n\n \n\nAlthough we initially intended to focus our search\nfor a business opportunity in the consumer products industry, we are not limited to evaluating a business opportunity in any particular\nindustry sector. As a result, there is no current basis to evaluate the possible merits or risks of any particular business opportunity.\nTo the extent we complete a transaction, we may be affected by numerous risks inherent in the business opportunity. For example, if we\npursue a business opportunity with a financially unstable business or an entity lacking an established record of sales or earnings, we\nmay be affected by the risks inherent in the business and operations of a financially unstable or a development stage entity. Although\nour officers and directors will endeavor to evaluate the risks inherent in a particular business opportunity, we cannot assure you that\nwe will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence.\nFurthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those\nrisks will adversely impact a business opportunity. We also cannot assure you that an investment in our securities will ultimately prove\nto be more favorable to you than a direct investment, if such opportunity were available, in a business opportunity.\n\n \n\n*Our success largely depends on the ability\nof our management team to operate and execute effectively.*\n\n \n\nOur success largely depends on the ability of\nour management team to effectively organize and consummate a business opportunity. Our management team is critical to the execution of\nour strategic direction and implementation of a business opportunity. It is difficult to predict with any certainty that we will be able\nto replace these individuals with persons of equivalent experience and capabilities should one or more members no longer be able to serve\nin their current capacity. If we are unable to find adequate replacements or to attract, retain and incentivize senior executives, other\nkey advisors or new qualified personnel, such inability could have a material adverse effect on our ability to effect a business opportunity\nand final results of operations.\n\n* *\n\n*Past performance by our management team,\nour special advisors and their respective affiliates may not be indicative of future performance of an investment in us.*\n\n \n\nInformation regarding performance by, or businesses\nassociated with, our management team, our special advisors and their respective affiliates is presented for informational purposes only.\nPast performance by them is not a guarantee either (i) of success with respect to any business opportunity we may consummate, or (ii)\nthat we will be able to locate a suitable business opportunity. You should not rely on the historical record of the performance of our\nmanagement team, our special advisors and their respective affiliates or businesses associated with them as indicative of the future\nperformance of an investment in us or the returns we will, or are likely to, generate going forward.\n\n* *\n\n23\n\n \n\n* *\n\n*Any future involvement of our Sponsor and\nits affiliates, members of our management and companies with which they are affiliated in governmental investigations or civil litigation\nunrelated to our business affairs could materially impact our ability to consummate a business opportunity.*\n\n \n\nOur Sponsor and its affiliates, members of our\nmanagement team and companies with which they are affiliated may become involved in governmental investigations and civil litigation\nrelating to their business affairs unrelated to our Company in the United States or in other jurisdictions. Such matters, should they\narise in the future, risk distracting them from attention to our affairs and may negatively impact our ability to attract suitable business\nopportunities and may ultimately impede our ability to consummate a transaction.\n\n* *\n\n*We may seek business opportunities in any\nindustry our management chooses (which industries may be outside of our management’s areas of expertise).*\n\n \n\nWe may consider a business opportunity in any\nindustry our management chooses. Although our management will endeavor to evaluate the risks inherent in any particular business opportunity,\nwe cannot assure you that we will adequately ascertain or assess all of the significant risk factors. We also cannot assure you that\nan investment in our securities will not ultimately prove to be less favorable to investors in this offering than a direct investment,\nif an opportunity were available, in a business opportunity. In the event we elect to pursue a business opportunity outside of the areas\nof our management’s expertise, our management’s expertise may not be directly applicable to its evaluation or operation,\nand the information contained in this prospectus regarding the areas of our management’s expertise would not be relevant to an\nunderstanding of the business that we elect to pursue. As a result, our management may not be able to adequately ascertain or assess\nall of the significant risk factors.\n\n* *\n\n*We may seek business opportunities with\na financially unstable business or an entity lacking an established record of revenue, cash flow or earnings, which could subject us\nto volatile revenues, cash flows or earnings or difficulty in retaining key personnel.*\n\n \n\nTo the extent we effect a transaction with a\nfinancially unstable business or an entity lacking an established record of revenues or earnings, we may be affected by numerous risks\ninherent in the operations of that business opportunity. These risks include volatile revenues or earnings and difficulties in obtaining\nand retaining key personnel. Although our officers and directors will endeavor to evaluate the risks inherent in a particular business\nopportunity, we may not be able to properly ascertain or assess all of the significant risk factors and we may not have adequate time\nto complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or\nreduce the chances that those risks will adversely impact a business opportunity.\n\n* *\n\n*We are not required to obtain an opinion\nfrom an independent investment banking firm, or another valuation or appraisal firm that commonly renders fairness opinions, and consequently\nyou may have no assurance from an independent source that the price we are paying in a transaction is fair to our stockholders from a\nfinancial point of view.*\n\n \n\nUnless we complete a transaction with an affiliated\nentity, we are not required to obtain an opinion from an independent investment banking firm, or another valuation or appraisal firm\nthat commonly renders fairness opinions, that the price we are paying is fair to our stockholders from a financial point of view. If\nno opinion is obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair market value\nbased on standards generally accepted by the financial community.\n\n \n\n*Resources could be wasted in researching\nbusiness opportunities that are not completed, which could materially adversely affect subsequent attempts to identify and effect a business\nopportunity. If we are unable to complete a transaction, our warrants may expire worthless.*\n\n \n\nWe anticipate that the investigation of each\nspecific business opportunity and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments\nwill require substantial management time and attention and substantial costs for accountants, attorneys and others. If we decide not\nto complete a specific business opportunity, the costs incurred up to that point for the proposed transaction likely would not be recoverable.\nFurthermore, if we reach an agreement relating to a specific business opportunity, we may fail to complete the transaction for any number\nof reasons, including those beyond our control. Any such event will result in a loss to us of the related costs incurred which could\nmaterially adversely affect subsequent attempts to identify and effect another business opportunity.\n\n* *\n\n*We may reincorporate in another jurisdiction\nand such reincorporation may result in taxes imposed on stockholders.*\n\n \n\nWe may, subject to requisite stockholder approval\nunder the DGCL, reincorporate in another jurisdiction. The transaction may require a stockholder to recognize taxable income in the jurisdiction\nin which the stockholder is a tax resident or in which its members are resident if it is a tax transparent entity. We do not intend to\nmake any cash distributions to stockholders to pay such taxes. Stockholders may be subject to withholding taxes or other taxes with respect\nto their ownership of us after the reincorporation.\n\n \n\n24\n\n \n\n \n\n*Our ability to successfully effect a business\nopportunity and to be successful thereafter will be totally dependent upon the efforts of our key personnel. The loss of key personnel\ncould negatively impact the operations and profitability of a business opportunity.*\n\n \n\nPrior to the completion of a transaction, our\noperations will be dependent upon a relatively small group of individuals and, in particular, our executive officers and directors. We\nbelieve that our success depends on the continued service of our officers and directors, at least until we have completed a business\nopportunity. In addition, our executive officers and directors are not required to commit any specified amount of time to our affairs\nand, accordingly, will have conflicts of interest in allocating their time among various business activities, including identifying potential\nbusiness opportunities and monitoring the related due diligence. We do not have an employment agreement with, or key-man insurance\non the life of, any of our directors or executive officers. The unexpected loss of the services of one or more of our directors or executive\nofficers could have a detrimental effect on us.\n\n \n\nThe role of key personnel in a business opportunity,\nhowever, cannot presently be ascertained. Although some key personnel may remain in senior management or advisory positions following\na transaction, it is equally likely that some or all may be replaced. While we intend to closely scrutinize any individuals we engage\nin relation to a particular business opportunity, we cannot assure you that our assessment of these individuals will prove to be correct.\nThese individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to\nexpend time and resources helping them become familiar with such requirements. In addition, certain officers and directors may resign\nupon completion of a transaction. The departure of key personnel could negatively impact our operations and profitability. The role of\nkey personnel cannot be ascertained at this time. Although we contemplate that certain members of the management team will remain post-transaction,\nit is possible that members of management will not wish to remain. The loss of key personnel could negatively impact the operations and\nprofitability of our post-transaction business.\n\n* *\n\n*Our key personnel may negotiate employment\nor consulting agreements in connection with a particular business opportunity, and a particular business opportunity may be conditioned\non the retention or resignation of such key personnel. These agreements may provide for them to receive compensation following a transaction\nand, as a result, may cause them to have conflicts of interest in determining whether a particular business opportunity is the most advantageous.*\n\n \n\nOur key personnel may be able to remain with\nour company post-transaction only if they are able to negotiate employment or consulting agreements. Such negotiations would take place\nsimultaneously with the negotiation of the transaction and could provide for such individuals to receive compensation in the form of\ncash payments and/or our securities for services they would render to us with respect to such business opportunity. Such negotiations\nalso could make such key personnel’s retention or resignation a condition to a transaction. The personal and financial interests\nof such individuals may influence their motivation in identifying and selecting a business opportunity, subject to their fiduciary duties\nunder Delaware law.\n\n* *\n\n*We may have a limited ability to assess\na prospective business opportunity and, as a result, may identify and effect a business opportunity whose management may not have the\nskills, qualifications or abilities to manage a public company, which could, in turn, negatively impact the value of our stockholder’s\ninvestment in us.*\n\n \n\nWhen evaluating the desirability of effecting\na business opportunity, our ability to assess management may be limited due to a lack of time, resources or information. Our assessment\nof the capabilities of the management team, therefore, may prove to be incorrect and such management may lack the skills, qualifications\nor abilities we suspected. Should management not possess the skills, qualifications or abilities necessary to manage a public company,\nthe operations and profitability of the post-transaction business may be negatively impacted.\n\n \n\n*Our executive officers and directors will\nallocate their time to other businesses, thereby causing conflicts of interest in their determination as to how much time to devote to\nour affairs. This conflict of interest could have a negative impact on our ability to effect a business opportunity.*\n\n \n\nOur executive officers and directors are not\nrequired to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time\nbetween our operations and our search for a business opportunity and their other businesses. We do not intend to have any full-time employees\nprior to the completion of a transaction. Each of our executive officers is engaged in several other business endeavors for which they\nmay be entitled to substantial compensation, and our executive officers are not obligated to contribute any specific number of hours\nper week to our affairs. Our independent directors also serve as officers and board members for other entities. If our executive officers’\nand directors’ other business affairs require them to devote substantial amounts of time to such affairs in excess of their current\ncommitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our ability to effect\na business opportunity.\n\n \n\n25\n\n \n\n \n\n*Our officers and directors presently have\nfiduciary or contractual obligations to other entities and, accordingly, may have conflicts of interest in determining to which entity\na particular business opportunity should be presented.*\n\n \n\nWe intend to engage in the business of identifying\nand effecting one or more business opportunities. Each of our officers and directors presently has, and any of them in the future may\nhave, additional fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required\nto present business opportunities to such entity. Accordingly, our officers and directors may have conflicts of interest in determining\nto which entity a particular business opportunity should be presented. These conflicts may not be resolved in our favor and a potential\nbusiness opportunity may be presented to another entity prior to its presentation to us, subject to their fiduciary duties under Delaware\nlaw.\n\n* *\n\n*Our officers and directors may in the future\nbecome affiliated with entities engaged in business activities similar to those intended to be conducted by us, and, accordingly, may\nhave conflicts of interest in determining to which entity a particular business opportunity should be presented.*\n\n \n\nWe intend to engage in the business of identifying\nand effecting one or more business opportunities. Each of our officers and directors presently has, and any of them in the future may\nhave, additional fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required\nto present business opportunities to such entities. Accordingly, they may have conflicts of interest in determining to which entity a\nparticular business opportunity should be presented. These conflicts may not be resolved in our favor and a potential target business\nmay be presented to other entities prior to its presentation to us, subject to our officers’ and directors’ fiduciary duties\nunder Delaware law.\n\n \n\nIn addition, our Sponsor and our officers and\ndirectors may sponsor or form other companies similar to ours or may pursue other business or investment ventures during the period in\nwhich we are seeking business opportunities. Any such companies, businesses or investments may present additional conflicts of interest\nin pursuing business opportunities. However, we do not believe that any such potential conflicts would materially affect our ability\nto effect a business opportunity.\n\n \n\n*Our executive officers, directors, security\nholders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.*\n\n \n\nWe have not adopted a policy that expressly prohibits\nour directors, executive officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in\nany investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may\neffect a business opportunity with an entity that is affiliated with our Sponsor, our directors or executive officers, although we do\nnot intend to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in business\nactivities of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.\n\n \n\nThe personal and financial interests of our directors\nand officers may influence their motivation in timely identifying and selecting a business opportunity and completing a transaction.\nConsequently, our directors’ and officers’ discretion in identifying and selecting a suitable business opportunity may result\nin a conflict of interest when determining whether the terms, conditions and timing of a particular business opportunity are appropriate\nand in our stockholder’s best interest. If this were the case, it would be a breach of their fiduciary duties to us as a matter\nof Delaware law, and we or our stockholders might have a claim against such individuals for infringing on our stockholder’s rights.\nHowever, we might not ultimately be successful in any claim we may make against them for such reason.\n\n* *\n\n*We may effect a business opportunity with\none or more entities that have relationships with entities that may be affiliated with our Sponsor, executive officers, directors or\nexisting holders, which may raise potential conflicts of interest.*\n\n \n\nIn light of the involvement of our Sponsor, executive\nofficers and directors with other entities, we may decide to effect one or more business opportunities that are affiliated with our Sponsor,\nexecutive officers, directors or existing holders. Our directors also serve as officers and board members for other entities. Such entities\nmay compete with us for business opportunities. Our Sponsor, officers and directors are not currently aware of any specific business\nopportunities involving any entities with which they are affiliated, and there have been no substantive discussions concerning a business\nopportunity with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any\naffiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria for a business\nopportunity, and such transaction was approved by a majority of our independent and disinterested directors. Despite our agreement to\nobtain an opinion regarding the fairness to our company from a financial point of view of a business opportunity with one or more businesses\naffiliated with our Sponsor, executive officers, directors or existing holders, potential conflicts of interest still may exist and,\nas a result, the terms of the business opportunity may not be as advantageous to our public stockholders as they would be absent any\nconflicts of interest.\n\n \n\n26\n\n \n\n \n\n*We may issue notes or other debt securities,\nor otherwise incur substantial debt, to effect a business opportunity, which may adversely affect our leverage and financial condition\nand thus negatively impact the value of our stockholder’s investment in us.*\n\n \n\nAlthough we have no current commitments to issue\nany notes or other debt securities, or to otherwise incur outstanding debt, we may choose to incur substantial debt to effect a business\nopportunity. The incurrence of debt could have a variety of negative effects, including:\n\n \n\n \n➤\ndefault and foreclosure\non our assets if our operating revenues are insufficient to repay our debt obligations;\n\n \n\n \n➤\nacceleration of our obligations\nto repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require\nthe maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;\n\n \n \n \n\n \n➤\nour immediate payment of\nall principal and accrued interest, if any, if the debt security is payable on demand;\n\n \n \n \n\n \n➤\nour inability to obtain\nnecessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the\ndebt security is outstanding;\n\n \n \n \n\n \n➤\nour inability to pay dividends\non our Class A common stock;\n\n \n\n \n➤\nusing a substantial portion\nof our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our Class A common\nstock if declared, expenses, capital expenditures, acquisitions and other general corporate purposes;\n\n \n \n \n\n \n➤\nlimitations on our flexibility\nin planning for and reacting to changes in our business and in the industry in which we operate;\n\n \n \n \n\n \n➤\nincreased vulnerability\nto adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and\n\n \n \n \n\n \n➤\nlimitations on our ability\nto borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy\nand other purposes and other disadvantages compared to our competitors who have less debt.\n\n \n\n*We may only be able to effect one business\nopportunity, which will cause us to be solely dependent on a single business which may have a limited number of products or services.\nThis lack of diversification may negatively impact our operations and profitability.*\n\n \n\nWe may only be able to effect one business opportunity.\nBy effecting a business opportunity with only a single entity, our lack of diversification may subject us to numerous economic, competitive\nand regulatory developments. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks\nor offsetting of losses, unlike other entities which may have the resources to effect several business opportunities in different industries\nor different areas of a single industry. Accordingly, the prospects for our success may be:\n\n \n\n \n➤\nsolely dependent upon the\nperformance of a single business opportunity; or\n\n \n\n \n➤\ndependent upon the development\nor market acceptance of a single or limited number of products, processes or services.\n\n \n\nThis lack of diversification may subject us to\nnumerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry\nin which we may operate.\n\n* *\n\n*We may attempt to simultaneously effect\nmultiple business opportunities, which may hinder our ability to complete a business opportunity and give rise to increased costs and\nrisks that could negatively impact our operations and profitability.*\n\n \n\nIf we determine to simultaneously effect several\nbusiness opportunities, we may need for each to agree that effecting one business opportunity is contingent on the other business opportunities,\nwhich may make it more difficult for us, and delay our ability, to effect a business opportunity. With multiple business opportunities,\nwe could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence\nand the additional risks associated with the subsequent assimilation of different business opportunities. If we are unable to adequately\naddress these risks, it could negatively impact our profitability and results of operations.\n\n \n\n27\n\n \n\n \n\n*We may attempt to effect a business opportunity\nwith a private company about which little information is available, which may result in a transaction that is not as profitable as we\nsuspected, if at all.*\n\n \n\nWe may seek to effect a business opportunity\nwith a privately held company. By definition, very little public information generally exists about private companies, and we could be\nrequired to make our decision on whether to pursue a potential business opportunity on the basis of limited information, which may result\nin a transaction that is not as profitable as we suspected, if at all.\n\n \n\n*We may be unable to obtain additional financing\nto effect a business opportunity or to fund our operations and growth, which could compel us to restructure or abandon a particular business\nopportunity. If we are unable to effect a business opportunity, our warrants may expire worthless.*\n\n \n\nAs we have not yet selected any prospective business\nopportunity, we cannot ascertain the capital requirements for any particular transaction; however, it is likely that we will require\nadditional financing to effect a business opportunity. We cannot assure you that such financing will be available on acceptable terms,\nif at all. The current economic environment has made it especially difficult for companies to obtain such financing. To the extent that\nadditional financing proves to be unavailable when needed to effect a business opportunity, we would be compelled to either restructure\nthe transaction or abandon that particular business opportunity and seek an alternative business opportunity. If we are unable to effect\na business opportunity, our warrants may expire worthless. In addition, even if we do not need additional financing to effect a business\nopportunity, we may require such financing to fund our operations or growth. The failure to secure additional financing could have a\nmaterial adverse effect on our continued development or growth. None of our officers, directors or stockholders is required to provide\nany financing.\n\n* *\n\n*Our Sponsor controls a substantial interest\nin us and thus may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support.*\n\n \n\nGiven that it controls a substantial interest\nin us, our Sponsor may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not\nsupport, including amendments to our certificate of incorporation.\n\n* *\n\nFurther, holders of our Founder Shares will be\nentitled to ten (10) votes for each Founder Share held at any annual or special meeting of stockholders or in the case of any written\nconsent of stockholders in lieu of a meeting and for all purposes. Holders of our public shares will be entitled to one vote for each\nsuch share. Additionally, only holders of our Founder Shares will have the right to vote on the election of directors. Holders of our\npublic shares will not be entitled to vote on the election of directors.\n\n* *\n\n*We may amend the terms of the warrants\nin a manner that may be adverse to holders of public warrants with the approval by the holders of at least 50% of the then outstanding\npublic warrants. As a result, the exercise price of your warrants could be increased, the exercise period could be shortened and the\nnumber of shares of our Class A common stock purchasable upon exercise of a warrant could be decreased, all without your approval.*\n\n \n\nOur warrants were issued in registered form under\na warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides\nthat the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision,\nbut requires the approval by the holders of at least 50% of the then outstanding public warrants to make any change that adversely affects\nthe interests of the registered holders of public warrants. Accordingly, we may amend the terms of the public warrants in a manner adverse\nto a holder if holders of at least 50% of the then outstanding public warrants approve of such amendment (which would include any public\nwarrants purchased by our Sponsor or any of our officers or directors).\n\n \n\nAlthough our ability to amend the terms of the\npublic warrants with the consent of at least 50% of the then outstanding public warrants is unlimited, examples of such amendments could\nbe amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash, shorten the exercise\nperiod or decrease the number of shares of Class A common stock purchasable upon exercise of a warrant.\n\n \n\n28\n\n \n\n \n\n*We are no longer an emerging growth company\nand are now subject to increased reporting requirements, which may increase our costs and require additional management time and resources..*\n\n \n\nWe were previously an “emerging growth\ncompany” until December 31, 2025. As a result of the expiration of our emerging growth company status, we are no longer permitted\nto take advantage of certain exemptions from various reporting requirements that were available to emerging growth companies.\n\n \n\nAs a result, we are now subject to increased\ndisclosure and compliance requirements, which may increase our legal, accounting, audit, insurance, and other compliance costs. In particular,\nwe may be required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002 regarding\nthe effectiveness of our internal control over financial reporting when such requirements become applicable to us. In addition, we are\nsubject to more extensive executive compensation disclosure requirements and other disclosure and governance requirements applicable\nto companies that are not emerging growth companies.\n\n \n\nThese additional requirements may increase our\ncompliance costs and the time and effort required of our management and other personnel. The increased costs and management attention\nassociated with compliance with these requirements could adversely affect our business, financial condition, and results of operations.\n\n \n\nAdditionally, we qualify as a “smaller\nreporting company,” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended, and the rules of the U.S. Securities\nand Exchange Commission. As a smaller reporting company, we are permitted to provide reduced disclosure in our filings with the Securities\nand Exchange Commission, including, among other things, providing only two years of audited financial statements and reduced executive\ncompensation disclosure. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value\nof our voting and non-voting common equity held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues\nexceed $100 million during such completed fiscal year and the market value of our voting and non-voting common equity held by non-affiliates\nexceeds $700 million as of the prior June 30. To the extent we rely on such reduced disclosure requirements, it may make comparison of\nour financial statements and other disclosures with those of other public companies more difficult.* *\n\n \n\n*Compliance obligations under the Sarbanes-Oxley\nAct may make it more difficult for us to effect a business opportunity, require substantial financial and management resources, and increase\nthe time and costs of completing a transaction.*\n\n \n\nSection 404 of the Sarbanes-Oxley Act requires\nthat we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K. Only in the event we are\ndeemed to be a large accelerated filer or an accelerated filer and no longer an emerging growth company will we be required to comply\nwith the independent registered public accounting firm attestation requirement on our internal control over financial reporting. Further,\nfor as long as we remain an emerging growth company, we will not be required to comply with the independent registered public accounting\nfirm attestation requirement on our internal control over financial reporting. The development and maintenance of internal control to\nachieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to effect a business opportunity.\n\n* *\n\n*Provisions in our certificate of incorporation\nand bylaws and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future\nfor our common stock and could entrench management.*\n\n \n\nOur certificate of incorporation and bylaws contain\nprovisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests. Holders of\nour Founder Shares will be entitled to ten (10) votes for each Founder Share held at any annual or special meeting of stockholders or\nin the case of any written consent of stockholders in lieu of a meeting and for all purposes. Holders of our public shares will be entitled\nto one vote for each such share. Additionally, only holders of our Founder Shares will have the right to vote on the election of directors.\nHolders of our public shares will not be entitled to vote on the election of directors. This may entrench management and discourage unsolicited\nstockholder proposals that may be in the best interest of stockholders. Moreover, our board of directors has the ability to designate\nthe terms of and issue new series of preferred stock.\n\n \n\nWe are also subject to anti-takeover provisions\nunder Delaware law, which could delay or prevent a change of control. Together these provisions may make more difficult the removal of\nmanagement and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.\n\n \n\n29\n\n \n\n \n\n*Our certificate of incorporation provides,\nsubject to limited exceptions, that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder\nlitigation matters, which could limit our stockholder’s ability to obtain a favorable judicial forum for disputes with us or our\ndirectors, officers, employees or stockholders.*\n\n \n\nOur certificate of incorporation requires, to\nthe fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers and employees for\nbreach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware and, if brought\noutside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s\ncounsel except any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party\nnot subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of\nthe Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or\nforum other than the Court of Chancery, (C) for which the Court of Chancery does not have subject matter jurisdiction, or (D) any action\narising under the Securities Act, as to which the Court of Chancery and the federal district court for the District of Delaware shall\nhave concurrent jurisdiction. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall\nbe deemed to have notice of and consented to the forum provisions in our certificate of incorporation.\n\n \n\nThis choice of forum provision may limit a stockholder’s\nability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers or employees,\nwhich may discourage lawsuits with respect to such claims, although our stockholders will not be deemed to have waived our compliance\nwith federal securities laws and the rules and regulations thereunder and may therefore bring a claim in another appropriate forum. We\ncannot be certain that a court will decide that this provision is either applicable or enforceable, and if a court were to find the choice\nof forum provision contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional\ncosts associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition.\n\n \n\nOur certificate of incorporation provides that\nthe exclusive forum provision will be applicable to the fullest extent permitted by applicable law. Section 27 of the Exchange Act creates\nexclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations\nthereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the\nExchange Act or any other claim for which the federal courts have exclusive jurisdiction.\n\n \n\n*Cyber incidents or attacks directed at\nus could result in information theft, data corruption, operational disruption and/or financial loss.*\n\n \n\nWe will likely depend on digital technologies,\nincluding information systems, infrastructure and cloud applications and services, including those of third parties with which we may\ndeal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure\nof third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential\ndata. As an early-stage company without significant investments in data security protection, we may not be sufficiently protected against\nsuch occurrences. We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability\nto, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business\nand lead to financial loss or inability to effect a business opportunity.\n\n* *\n\n*There may be tax consequences that may\nadversely affect us.*\n\n \n\nWhile we expect to undertake any business opportunity\nso as to minimize taxes, a particular transaction could result in the imposition of substantial taxes. Additionally, depending on the\ndate and size of our initial business combination, it is possible that at least 60% of our adjusted ordinary gross income may consist\nof personal holding company income. In addition, depending on the concentration of our stock in the hands of individuals, including the\nmembers of our Sponsor and certain tax-exempt organizations, pension funds, and charitable trusts, it is possible that more than\n50% of our stock will be owned or deemed owned (pursuant to the constructive ownership rules) by such persons during the last half of\na taxable year. Thus, no assurance can be given that we will not become a personal holding company following this offering or in the\nfuture. If we are or were to become a personal holding company in a given taxable year, we would be subject to an additional personal\nholding company tax, currently 20%, on our undistributed taxable income, subject to certain adjustments.\n\n \n\n*There may be uncertain or adverse U.S.\nfederal income tax consequences.*\n\n \n\nThere may be uncertain U.S. federal income tax\nconsequences pertaining to certain transactions. For instance, the U.S. federal income tax consequences of a cashless exercise of warrants\nis unclear under current law. Prospective investors are urged to consult their tax advisors with respect to these and other tax consequences\nwhen purchasing, holding or disposing of our securities.\n\n \n\n30\n\n \n\n \n\n*If we pursue a business opportunity outside\nof the United States, we may face additional burdens in connection with investigating, agreeing to and effecting such business opportunity,\nand if we effect such business opportunity, we would be subject to a variety of additional risks that may negatively impact our operations.*\n\n \n\nIf we pursue a business opportunity outside of\nthe United States, we would be subject to risks associated with a variety of cross-border issues, including in connection with investigating,\nagreeing to and effecting a business opportunity, conducting due diligence in a foreign jurisdiction, having such transaction approved\nby any local governments, regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange rates.\n\n \n\nIf we effect a business opportunity outside of\nthe United States, we would be subject to any special considerations or risks associated with operating in an international setting,\nincluding any of the following:\n\n \n\n \n●\ncosts and difficulties\ninherent in managing cross-border business operations;\n\n \n\n \n●\nrules and regulations regarding\ncurrency redemption;\n\n \n\n \n●\ncomplex corporate withholding\ntaxes on individuals;\n\n \n\n \n●\nlaws governing the manner\nin which future operations may be affected;\n\n \n\n \n●\nexchange listing and/or\ndelisting requirements;\n\n \n\n \n●\ntariffs and trade barriers;\n\n \n\n \n●\nregulations related to\ncustoms and import/export matters;\n\n \n\n \n●\nlocal or regional economic\npolicies and market conditions;\n\n \n\n \n●\nunexpected changes in regulatory\nrequirements;\n\n \n\n \n●\nlonger payment cycles;\n\n \n\n \n●\ntax issues, such as tax\nlaw changes and variations in tax laws as compared to the United States;\n\n \n\n \n●\ncurrency fluctuations and\nexchange controls;\n\n \n\n \n●\nrates of inflation;\n\n \n\n \n●\nchallenges in collecting\naccounts receivable;\n\n \n\n \n●\ncultural and language differences;\n\n \n\n \n●\nemployment regulations;\n\n \n\n \n●\nunderdeveloped or unpredictable\nlegal or regulatory systems;\n\n \n\n \n●\ncorruption;\n\n \n\n31\n\n \n\n \n\n \n●\nprotection of intellectual\nproperty;\n\n \n\n \n●\nsocial unrest, crime, strikes,\nriots and civil disturbances;\n\n \n\n \n●\nregime changes and political\nupheaval;\n\n \n\n \n●\nterrorist attacks and wars;\nand\n\n \n\n \n●\ndeterioration of political\nrelations with the United States.\n\n  \n\nWe may not be able to adequately address these\nadditional risks. If we were unable to do so, we may be unable to effect such business opportunity, or, if we do effect such business\nopportunity, our operations might suffer, either of which may adversely impact our business, financial condition and results of operations.\n\n \n\n*If a change in management occurs, and new\nmanagement is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such laws,\nwhich could lead to various regulatory issues.*\n\n \n\nOur management may resign from their positions\nas officers or directors of the company and new management may take their place. New management may not be familiar with United States\nsecurities laws. If new management is unfamiliar with United States securities laws, they may have to expend time and resources becoming\nfamiliar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues which may adversely\naffect our operations.\n\n \n\n*If we effect a business opportunity outside\nof the United States, substantially all of our assets could be located in a foreign country and substantially all of our revenue could\nbe derived from our operations in such country. Accordingly, our results of operations and prospects could be subject, to a significant\nextent, to the economic, political and legal policies, developments and conditions in the country in which we operate.*\n\n \n\nThe economic, political and social conditions,\nas well as government policies, of the country in which our operations are ultimately located could affect our business. Economic growth\ncould be uneven, both geographically and among various sectors of the economy, and such growth may not be sustained in the future. If\nin the future such country’s economy experiences a downturn or grows at a slower rate than expected, there may be less demand for\nspending in certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our ability\nto find and/or effect an attractive business opportunity.\n\n \n\n*Exchange rate fluctuations and currency\npolicies may cause our ability to succeed in the international markets to be diminished.*\n\n \n\nIn the event we effect a business opportunity\noutside of the United States, all revenues and income would likely be received in a foreign currency, and the dollar equivalent of our\nnet assets and distributions, if any, could be adversely affected by reductions in the value of the local currency. The value of currencies\nfluctuates and is affected by, among other things, changes in political and economic conditions. Any change in the relative value of\nsuch currency against our reporting currency may affect the attractiveness of any business opportunity and/or our financial condition\nand results of operations. Additionally, if a currency appreciates in value against the dollar prior to the consummation of a transaction,\nthe cost of a transaction as measured in dollars will increase, which may make it less likely that we are able to consummate such transaction.\n\n \n\n*We may face risks related to consumer and\nconsumer-related products and services industries.*\n\n \n\nBusiness opportunities within the consumer and\nconsumer-related products and services industries entail special considerations and risks. If we are successful in effecting a business\nopportunity within such industries, we may be subject to, and possibly adversely affected by, the following risks:\n\n \n\n \n●\nan inability to compete\neffectively in a highly competitive environment with many incumbents having substantially greater resources;\n\n \n\n \n●\nan inability to manage\nrapid change, increasing consumer expectations and growth;\n\n \n\n \n●\nan inability to build strong\nbrand identity and improve customer satisfaction and loyalty;\n\n \n\n \n●\nlimitations on our ability\nto protect our intellectual property rights, including trade secrets, that could cause a loss in revenue and any competitive advantage;\n\n \n\n \n●\nthe high cost or unavailability\nof materials, equipment, supplies and personnel that could adversely affect our ability to execute our operations on a timely basis;\n\n \n\n32\n\n \n\n \n\n \n●\nan inability to attract\nand retain customers;\n\n \n\n \n●\nan inability to license\nor enforce intellectual property rights on which our business may depend;\n\n \n\n \n●\nseasonality and weather\nconditions that may cause our operating results to vary from quarter to quarter;\n\n \n\n \n●\nan inability by us to successfully\nanticipate changing consumer preferences and buying trends and manage our product line and inventory commensurate with customer demand;\n\n \n\n \n●\npotential liability for\nnegligence, copyright, or trademark infringement or other claims based on the nature and content of materials that we may distribute;\n\n \n\n \n●\ndependence of our operations\nupon third-party suppliers whose failure to perform adequately could disrupt our business;\n\n \n\n \n●\nour operating results may\nbe adversely affected by changes in the cost or availability of raw materials and energy;\n\n \n\n \n●\nwe may be subject to production-related\nrisks which could jeopardize our ability to realize anticipated sales and profits;\n\n \n\n \n●\nregulatory changes that\nimpact our ability to import products or material inputs on a cost effective basis;\n\n \n\n \n●\nchanges in the retail industry\nand markets for consumer products affecting our customers or retailing practices could negatively impact customer relationships and\nour results of operations; and\n\n \n\n \n●\nour business could involve\nthe potential for product recalls, product liability and other claims against us, which could affect our earnings and financial condition.\n\n \n\nAny of the foregoing could have an adverse impact\non our operations. However, our efforts in identifying prospective businesses opportunities will not be limited to consumer and consumer-related products\nand services industries. Accordingly, if we effect a business opportunity in another industry, these risks will likely not affect us\nand we will be subject to other risks attendant with the specific industry in which we operate, none of which can be presently ascertained.\n\n \n\n*Failure to maintain effective internal control over financial\nreporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 could have a material adverse effect on our business.*\n\n \n\nAs a public company, we are required to maintain\neffective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002. Internal control\nover financial reporting is complex and may be revised over time to adapt to changes in our business, or changes in applicable accounting\nrules. We cannot assure you that our internal control over financial reporting will be effective in the future or that a material weakness\nwill not be discovered with respect to a prior period for which we had previously believed that our internal control over financial reporting\nwas effective. Matters impacting our internal control over financial reporting may cause us to be unable to report our financial information\non a timely basis, or may cause us to restate previously issued financial information, and thereby subject us to adverse regulatory consequences,\nincluding sanctions or investigations by the SEC, or violations of applicable stock exchange listing rules. There could also be a negative\nreaction in the financial markets due to a loss of investor confidence in us and the reliability of our financial statements. Confidence\nin the reliability of our financial statements is also likely to suffer if we report a material weakness in the effectiveness of our\ninternal control over financial reporting. This could materially adversely affect us by, for example, leading to a decline in the price\nof our shares/warrants and impairing our ability to attract a business opportunity and/or consummate a transaction.\n\n* *\n\n*Our warrants are accounted for as liabilities\nand changes in the value of our warrants could have a material effect on our financial results.*\n\n \n\nOn April 12, 2021, the SEC Staff expressed its\nview that certain terms and conditions common to SPAC warrants may require the warrants to be classified as liabilities instead of equity\non the SPAC’s balance sheet. As a result of the SEC Staff Statement, we re-evaluated the accounting treatment of our warrants,\nand determined to classify the warrants as derivative liabilities measured at fair value, with changes in fair value reported in our\nstatement of operations for each reporting period.\n\n \n\n33\n\n \n\n \n\nAs a result, included on our balance sheets as\nof March 31, 2026 and December 31, 2025, and contained elsewhere in this report, are derivative liabilities related to embedded features\ncontained within our warrants. ASC 815-40 provides for the re-measurement of the fair value of such derivatives at each balance sheet\ndate, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings in the statement of\noperations. As a result of the recurring fair value measurement, our financial statements and results of operations may fluctuate quarterly\nbased on factors which are outside of our control. Due to the recurring fair value measurement, we expect that we will recognize non-cash\ngains or losses on our warrants each reporting period and that the amount of such gains or losses could be material.\n\n \n\n*Changes in laws\nor regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to identify\na potential business opportunity and/or negotiate and complete a transaction, and results of operations.*\n\n \n\nWe are subject to laws\nand regulations enacted by national, regional and local governments. In particular, we will be required to comply with certain SEC and\nother legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly.\nThose laws and regulations and their interpretation and application may also change from time to time and those changes could have a\nmaterial adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws\nor regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to identify a\npotential business opportunity and/or negotiate and complete a transaction, and results of operations.\n\n \n\n*If we are deemed\nto be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and\nour activities may be restricted, which may make it difficult for us to complete a transaction or conduct other business activities.*\n\n \n\nIf we are deemed to\nbe an investment company under the Investment Company Act, our activities may be restricted, including:\n\n \n\n \n●\nrestrictions on the nature\nof our investments; and\n\n \n\n \n●\nrestrictions on the issuance\nof securities, each of which may make it difficult for us to identify a potential business opportunity and/or negotiate and complete\na transaction.\n\n \n\nIn addition, we may\nhave imposed upon us burdensome requirements, including:\n\n \n\n \n●\nregistration as an investment\ncompany;\n\n \n\n \n●\nadoption of a specific\nform of corporate structure; and\n\n \n\n \n●\nindependence, reporting,\nrecord keeping, voting, proxy and disclosure requirements and other rules and regulations.\n\n \n\nIn order not to be regulated\nas an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged\nprimarily in a business other than investing, reinvesting or trading in securities for purposes of Section (3)(a)(1)(A) thereof and that\nour activities do not include investing, reinvesting, owning, holding or trading “investment securities” constituting more\nthan 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis for purposes of Section\n(3)(a)(1)(C) thereof. Our business is to identify a potential business opportunity and complete a transaction.\n\n \n\nWe do not believe that\nour principal ongoing activities centered on identifying a potential business opportunity and completing a transaction will subject us\nto the Investment Company Act under the definition of “investment company” contained in Section (3)(a)(1)(A) thereof. By\nhaving a business plan targeted at identifying a potential business opportunity and completing a transaction, we intend to avoid being\ndeemed an “investment company” within the meaning of the Investment Company Act.\n\n \n\nHowever, we are aware of litigation against certain\nentities asserting that, notwithstanding the foregoing, those entities should be considered investment companies and the SEC has suggested\nthat the extended period of investment of assets by similar such entities raise questions about their status as investment companies\nunder Section 3(a)(1)(A) of the Investment Company Act.\n\n \n\n34\n\n \n\n \n\n*A new 1% U.S. federal excise tax could\nbe imposed on the Company in connection with redemptions.*\n\n \n\nOn August 16, 2022, the Inflation Reduction Act\nof 2022 (the “IRA”) was signed into federal law. The IRA provides for, among other things, a new U.S. federal 1% excise tax\non certain repurchases (including redemptions as defined in the Internal Revenue Code) of stock by publicly traded U.S. corporations\nand certain U.S. subsidiaries of publicly traded non-U.S. corporations (each, a “covered corporation”). Because our securities\nare publicly trading in the over-the-counter market, we may be deemed a “covered corporation” for this purpose. The excise\ntax is imposed on the repurchasing corporation itself, not its shareholders from which shares are repurchased. The amount of the excise\ntax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating\nthe excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair\nmarket value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S. Department\nof Treasury has been given authority to provide regulations and other guidance to carry out, and prevent the abuse or avoidance of, the\nexcise tax. The IRA applies only to repurchases that occur after December 31, 2022.\n\n \n\nTherefore, any redemption or other repurchase\nthat occurs after December 31, 2022, may be subject to the excise tax. Whether and to what extent we would be subject to the excise tax\nwould depend on a number of factors, including (i) the fair market value of the redemptions and, (ii) the nature and amount of the equity,\nand (iii) the content of regulations and other guidance from the U.S. Department of the Treasury. In addition, because the excise tax\nwould be payable by the Company, and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been\ndetermined. The foregoing could cause a reduction in the cash available on hand to identify a potential business opportunity and/or complete\na transaction.\n\n  \n\n*We filed a Form 25 with the SEC which became\neffective October 21, 2022, to voluntarily delist our common stock and public warrants from the NYSE and our securities are now available\nfor limited quotation in the over-the-counter market and it is expected that any trading will be limited and sporadic.*\n\n \n\nOur delisting from the NYSE took effect on October\n21, 2022; initially our shares of common stock and public warrants were trading on the NYSE and thereafter became eligible for quotation\non the Pink tier of OTC Markets Group, if market makers commit to making a market in the securities. We can provide no assurance that\ntrading in our securities will continue on the OTC Markets Group or otherwise. As a result of the delisting, we could face significant\nmaterial adverse consequences, including:\n\n \n\n \n●\na limited availability\nof market quotations for our securities;\n\n \n\n \n●\nreduced liquidity with\nrespect to our securities;\n\n \n\n \n●\na determination that our\nshares of common stock are “penny stock”, which will require brokers trading in our shares of common stock to adhere\nto more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our shares\nof common stock;\n\n \n\n \n●\na limited amount of news\nand analyst coverage for our company; and\n\n \n\n \n●\na decreased ability to\nissue additional securities or obtain additional financing in the future.\n\n \n\nCurrently our securities are not eligible for\nproprietary broker-dealer quotations. All quotes will reflect unsolicited customer orders and, as a result, we expect any trading to\ninvolve a higher risk of wider spreads, increased volatility, and price dislocations and a general illiquid trading environment. Proprietary\nbroker-dealer quotations may not commence until an initial review by a broker-dealer under the SEC’s Rule 15c2-11 which would enable\nbrokers to publish competing quotes and provide continuous market making. No assurance can be provided that a liquid trading market will\ndevelop even if market makers begin proprietary quotations and thus we expect investors will experience difficulty in trading our securities.\n\n \n\nThe National Securities Markets Improvement Act\nof 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred\nto as “covered securities.” Because they have been delisted, our securities would not be covered securities and we would\nbe subject to regulation in each state in which we offer our securities. This state level regulation introduces additional compliance\nrequirements for brokers to consider making markets in our securities and will further negatively impact any trading liquidity in our\nsecurities.\n\n \n\n35"}