Hudson Acquisition I Corp. - 10-K

ITEM 1A. RISK FACTORS

An investment in our securities involves a high degree of risk. You should carefully consider the following risk factors, together with the other information contained in this annual report and in the Form F-4 relating to the proposed business combination, before making an investment decision.

We may be required to liquidate if we do not complete an Initial Business Combination by July 18, 2026. Our stockholders have approved extensions that permit us to extend the deadline for completing an Initial Business Combination through July 18, 2026. If we are unable to complete an Initial Business Combination by the end of the combination period, we will be required to wind up, redeem the outstanding public shares and dissolve. In that event, the rights will expire worthless, our founder shares will become worthless and our public stockholders may receive less than they expected from the trust account.

Risks Related to the Proposed Business Combination

The proposed Business Combination may not be completed on the terms currently contemplated, or at all.

Completion of the proposed Business Combination with Aiways Europe is subject to numerous conditions, including stockholder approval, the effectiveness of the registration statement on Form F-4, the receipt of required regulatory approvals, the satisfaction or waiver of customary closing conditions and Pubco’s ability to obtain Nasdaq listing approval. There can be no assurance that these conditions will be satisfied or that the Business Combination will be completed within the required timeframe, or at all.

The absence of a minimum cash condition may result in the combined company having limited liquidity following the Business Combination.

The Business Combination Agreement does not include a minimum cash condition. As a result, the transaction may be completed even if a substantial majority of public stockholders elect to redeem their shares. If significant redemptions occur and additional financing is not obtained, the combined company may have limited cash resources, which could adversely affect its ability to execute its business plan, meet its obligations and sustain operations.

We have experienced substantial redemptions, which significantly reduce available cash and increase financing risk.

We have experienced significant redemptions in connection with prior extension votes, and as of December 31, 2025, only 36,771 public shares remained outstanding, representing a reduction of over 99% of the public shares originally issued in the Initial Public Offering. As a result, the funds remaining in the trust account are minimal. Further redemptions would reduce available cash even further and may impair our ability to complete the Business Combination, increase reliance on external financing and adversely affect the combined company’s post-closing liquidity.

We may not be able to obtain sufficient financing to complete the Business Combination or support the combined company.

The Business Combination contemplates additional transaction financing, including PIPE investments and other capital raising efforts. There can be no assurance that such financing will be obtained on acceptable terms, or at all. If financing is not obtained, we may be unable to complete the Business Combination or the combined company may lack sufficient capital to operate effectively following closing.

The PIPE investment is priced at a significant discount, which may result in dilution and misalignment of investor interests.

The PIPE investors have agreed to purchase shares at $5.00 per share, which is substantially below the $10.00 per share valuation used in the Business Combination. This pricing disparity may result in immediate dilution to public stockholders and may negatively affect market perception of the combined company’s valuation.

Public stockholders will own only a small minority of the combined company following the Business Combination.

Upon completion of the Business Combination, former shareholders of Aiways Europe are expected to own a substantial majority of the combined company, while our public stockholders will own only a small minority interest. This significant dilution will reduce the voting power and economic interest of public stockholders and limit their ability to influence the management and operations of the combined company.

Following the Business Combination, control of the combined company will shift to Aiways Europe’s shareholders.

After the Business Combination, former shareholders of Aiways Europe will hold a controlling interest in Pubco and will be able to exert significant influence over corporate decisions, including the election of directors and approval of major transactions. As a result, public stockholders will have limited ability to influence the management and policies of the combined company.

If Pubco is unable to obtain Nasdaq listing approval, the Business Combination may not be completed.

The Business Combination is conditioned upon Pubco obtaining approval to list its ordinary shares on Nasdaq. There can be no assurance that Pubco will satisfy Nasdaq’s initial listing requirements. If listing approval is not obtained, the Business Combination may not be consummated, and we may be required to liquidate.

The Business Combination may not be favorable to public stockholders.

Although our board of directors has determined that the Business Combination is fair and in the best interests of stockholders, this determination is based on various assumptions and analyses. The combined company’s actual performance may differ materially from expectations, and public stockholders may experience losses on their investment.

Risks Related to Our Sponsor and Corporate Structure

Our Sponsor controls a substantial majority of our voting power and may approve the Business Combination regardless of the votes of our public stockholders.

As of the date of this report, our Sponsor and its affiliates beneficially own approximately 98.27% of our outstanding voting power. As a result, the approval of the proposed Business Combination is effectively controlled by our Sponsor, and the votes of our public stockholders will have little or no impact on the outcome.

Our Sponsor, officers and directors have financial interests that may differ from those of public stockholders.

Our Sponsor acquired founder shares and private placement securities at prices significantly below those paid by public investors and has provided loans that may convert into equity. As a result, the Sponsor may realize a positive return even if public stockholders experience a loss, which may create incentives to complete the Business Combination rather than liquidate.

Public stockholders have limited ability to influence the outcome of the Business Combination and may primarily rely on their redemption rights.

Given the Sponsor’s voting control, public stockholders may have limited ability to influence the approval of the Business Combination. Accordingly, their primary means of protecting their investment is through the exercise of redemption rights.

Risks Related to Our Financial Condition and Operations

Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern.

We have no operating revenues and depend on the trust account and related-party financing to fund our operations. If we do not complete a Business Combination, we will be required to liquidate. These conditions raise substantial doubt about our ability to continue as a going concern.

We depend on related-party financing and may require additional capital.

We depend on related-party financing and may need additional capital to complete a Business Combination. As of December 31, 2025, the principal amount outstanding under related-party promissory notes was $1,115,977. There is no assurance that the Sponsor or any other financing source will continue to provide funds on acceptable terms, or at all, which could adversely affect our ability to operate and complete a Business Combination.

Our securities have been delisted from Nasdaq, and there is currently no active public market for our securities.

Trading in our securities was suspended in January 2025 and subsequently delisted. As a result, stockholders currently have very limited liquidity and may not be able to sell their securities at desired prices, or at all.

If we are unable to consummate the proposed business combination with Aiways Europe, we are likely to liquidate, and our stockholders may receive only a limited amount, if any, from the trust account.

We have focused our efforts on the proposed transaction with Aiways Europe and are not actively pursuing alternative business combination opportunities. Given our limited remaining time to complete an Initial Business Combination, if the proposed transaction is not completed, we are unlikely to be able to identify and complete another business combination.

In such event, we would be required to wind up our operations, redeem our public shares and liquidate. As a result of significant prior redemptions, the funds remaining in the trust account are minimal, and our public stockholders may receive only a small fraction of their original investment.

We are involved in material litigation that, if resolved unfavorably, could have a material adverse effect on our business, financial condition, and results of operations.

On November 22, 2024, a lawsuit was filed against us and certain officers alleging, among other things, breach of contract and retaliatory discharge, seeking approximately $143,000 in unpaid wages plus additional damages. In response, we have filed a countersuit against the plaintiff, alleging breach of employment contracts and gross negligence, and seeking damages of at least $6.5 million. Both cases are in their early stages, and the outcomes are uncertain. While we intend to vigorously pursue our counterclaims, litigation is inherently uncertain, and an adverse resolution of the plaintiff’s claims or an inability to succeed on our counterclaims could result in significant financial liabilities, divert management’s attention, and harm our reputation, any of which could have a material adverse effect on our business and ability to consummate our Initial Business Combination.

Risks Related to Aiways Europe and the Combined Company

Aiways Europe has significant capital requirements and limited liquidity.

Aiways Europe operates in a capital-intensive industry and requires substantial ongoing financing. If adequate financing is not available, its business, operations and growth prospects could be materially adversely affected.

The combined company will be dependent on a single business operating in the electric vehicle industry.

Following the Business Combination, the combined company will rely entirely on Aiways Europe’s business. Any adverse developments in this industry or affecting Aiways Europe specifically could have a material adverse effect on the combined company.

Following the business combination, Pubco is expected to operate as a foreign private issuer with operations outside the United States, which will subject it to additional risks.

Upon completion of the business combination, Pubco will operate the business of Aiways Europe, which has operations outside the United States. As a result, the combined company will be subject to risks associated with international operations, including differences in regulatory environments, economic and political conditions, foreign currency fluctuations, and compliance with foreign laws and regulations.

In addition, Pubco is expected to qualify as a foreign private issuer under U.S. securities laws and will be subject to different reporting and governance requirements than U.S. domestic issuers. These differences may result in less frequent or less detailed disclosure to investors and may make it more difficult for investors to evaluate the combined company’s performance and prospects.

The issuance of additional equity securities by Pubco in connection with the business combination and under its incentive equity plan will dilute the ownership interests of existing stockholders.

Following the completion of the business combination, Pubco, rather than the Company, will operate the combined business. Pubco expects to issue a substantial number of ordinary shares in connection with the transaction and may issue additional equity securities in the future, including under an incentive equity plan adopted in connection with the business combination.

The issuance of such securities, including awards under the incentive plan that may represent up to 10% of Pubco’s issued and outstanding shares following the closing (after giving effect to redemptions), will dilute the ownership interests of existing stockholders. In addition, any future equity issuances may further dilute stockholders and could adversely affect the market price and value of Pubco’s securities.

Our management team has limited experience in the electric vehicle industry.

Our management may not be able to fully evaluate the risks associated with Aiways Europe’s business, which could adversely affect the success of the Business Combination.

Risks Related to Regulatory and Structural Matters

Following the Business Combination, Pubco is expected to qualify as a foreign private issuer, which will result in reduced reporting requirements.

Pubco will be exempt from certain U.S. securities laws requirements, including quarterly reporting and proxy rules. As a result, investors may receive less frequent or less detailed information.

If we are deemed to be an investment company, we may be required to liquidate.

If we are deemed an investment company under the Investment Company Act, we would be subject to burdensome compliance requirements and may be forced to abandon our Business Combination efforts and liquidate.

We may be required to liquidate if we do not complete a Business Combination by July 18, 2026.

If we do not complete a Business Combination within the required timeframe, we will be required to wind up our operations, redeem our public shares and liquidate. In such event, our public stockholders may receive less than they expected and our warrants and rights will expire worthless.

The extremely high level of redemptions has significantly altered our capital structure and may adversely affect the viability of the combined company.

We have experienced redemptions exceeding 99% of our public shares, leaving only a very small number of shares outstanding. As a result, our remaining public float is extremely limited, and the capital available from the trust account is minimal.

This unusual capital structure may adversely affect investor confidence, increase financing risk, and make it more difficult for the combined company to operate effectively following the Business Combination.

Even if Pubco obtains Nasdaq listing approval, there may be limited or no active trading market for its securities.

Given the limited number of public shares outstanding and reduced public float, there can be no assurance that an active or liquid trading market will develop following the Business Combination. As a result, investors may experience significant volatility in the trading price of Pubco’s securities or may be unable to sell their shares at desired prices, or at all.

Our ability to generate value for stockholders is dependent on the completion of a single transaction.

We have focused substantially all of our efforts on the proposed Business Combination with Aiways Europe and are not actively pursuing alternative transactions. If the Business Combination is not completed, we are unlikely to identify and complete another transaction within the required timeframe and would be required to liquidate.

The Business Combination involves a complex transaction with a capital-intensive and operationally challenging business.

The proposed transaction involves combining with a company operating in the electric vehicle industry, which requires substantial capital, involves complex supply chains and is subject to regulatory and market uncertainties. In addition, the transaction involves cross-border elements and integration challenges.

These factors increase the risk that the combined company may not achieve its expected business objectives or financial performance.

Our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern.”

Our securities have been delisted from Nasdaq, and there is currently no active public market for our securities. Trading in our common stock, units and rights was suspended on January 24, 2025 and Nasdaq subsequently filed a Form 25 on July 11, 2025 to complete the delisting. As a result, our stockholders currently have very limited liquidity and may not be able to sell their securities at desired prices, or at all. Delisting also may impair our ability to attract investors, complete financing transactions and consummate an Initial Business Combination. In addition, delisting reduces the market transparency and investor protections that would otherwise accompany a Nasdaq-listed security. Although Pubco has applied to list its ordinary shares on Nasdaq in connection with the closing, there can be no assurance that it will satisfy the applicable initial listing standards or that it will be able to maintain such listing following the Business Combination.

We have substantial doubt about our ability to continue as a going concern. As a SPAC, we have no operating revenues and depend on the trust account, working capital advances and related-party financing to fund our operations. If we do not complete an Initial Business Combination by the end of the combination period, we will be required to liquidate. These conditions raise substantial doubt about our ability to continue as a going concern.

We recently changed our independent registered public accounting firm, which could result in additional costs and may affect the timing or effectiveness of our financial reporting.

On April 8, 2026, our audit committee approved the dismissal of WWC, P.C. as our independent registered public accounting firm and the appointment of HCL, PLLC as our new independent registered public accounting firm. Although there were no disagreements or reportable events with our former auditor, the transition to a new auditor requires the new firm to become familiar with our business, accounting policies and internal controls.

This transition may result in additional costs, increased demands on management and potential delays in the completion of our audits or the filing of our periodic reports. In addition, if our new auditor identifies issues in the course of its audit procedures, including matters relating to our internal controls over financial reporting, we may be required to devote additional resources to address such matters. Any delays or issues in our financial reporting could adversely affect our ability to complete the proposed business combination and maintain compliance with applicable reporting requirements.

Our Delisting from Nasdaq Increases the Risk of Pubco Failing to Obtain Listing Approval.

We have been delisted from Nasdaq after the signing of the Business Combination Agreement but prior to the Closing. While Nasdaq has confirmed that the our delisting will not automatically preclude Pubco from obtaining initial listing approval, there remains an increased risk that Pubco may fail to satisfy Nasdaq’s initial listing requirements, which is a condition precedent to Closing.

As a result of the Business Combination, Nasdaq will evaluate the listing eligibility of Pubco under its standard initial listing requirements, including minimum share price, market capitalization, shareholder equity, public float, and corporate governance standards. Our prior delisting may not directly impact this review, but it could still contribute to perceived risks that may indirectly affect the likelihood of listing approval, including:

Market and investor confidence concerns, which may impact trading activity and pricing stability

Regulatory and compliance risks, particularly if the prior delisting was due to governance, reporting, or financial deficiencies;

Potential Nasdaq inquiries into the circumstances surrounding HUDA’s delisting, which could result in additional scrutiny of Pubco’s eligibility; and

Extended review periods or additional requirements imposed by Nasdaq that could delay the approval process.

If Pubco fails to meet Nasdaq’s initial listing requirements, the business Combination cannot be consummated, and the transaction may be terminated pursuant to the Business Combination Agreement. In such an event, we may be forced to liquidate and return trust funds to Public Stockholders, potentially resulting in investors receiving less than their original investment and missing out on the opportunity to participate in any appreciation in Pubco’s securities.

We may be unable to recover overpayments made to redeeming stockholders in connection with our Extension Meetings, which could adversely affect our cash position or result in reputational or legal risk.

In connection with the redemption of shares pursuant to our First, Second, and Third Extension Meetings held on July 17, 2023, February 15, 2024, and July 5, 2024, respectively, redemption payments were made to public stockholders by Continental Stock Transfer & Trust Company (“CST”), as trustee of our Trust Account, at rates that were later determined to be overstated. The Company had not withdrawn all of the interest that it was entitled to withdraw from the Trust Account to pay tax liabilities prior to calculating the redemption price. As a result, an aggregate overpayment amount of approximately $819,949.42 (the “Aggregate Total Overpayment Amount”) was made to redeeming stockholders.

We have engaged CST to notify affected stockholders and requested the return of the overpaid funds. Subsequent to June 30, 2025, as of October 9, 2025, 44.4% of the total overpaid amount has been recovered, approximately $364,084.26 have been received.

While the Company currently expects to fully recover the Aggregate Total Overpayment Amount, there can be no assurance that stockholders will return all or any portion of the remaining overpayments. In the event the Overpayment Amount is not fully recovered, the Sponsor has committed, pursuant to the Sponsor Agreement, to pay all pre-closing tax liabilities of the Company. The Sponsor will remit such payment directly to the relevant taxing authorities prior to the consummation of the Business Combination. However, the Company may nonetheless face reputational harm or legal claims relating to the overpayment and attempted recovery.

The application of the excise tax under the Inflation Reduction Act of 2022 to us is uncertain and may be subject to interpretation or dispute.

Although our securities were delisted from Nasdaq on July 11, 2025 following the filing of a Form 25, it remains unclear whether we are subject to the 1% excise tax imposed on certain stock repurchases by publicly traded corporations. The application of the excise tax to redemptions of our public shares or to transactions undertaken in connection with the proposed business combination may be subject to differing interpretations and could be challenged by tax authorities.

If the excise tax is determined to apply, it could reduce the funds available to complete the business combination or for distribution to stockholders and could adversely affect the value of our securities. In addition, any dispute or uncertainty regarding the application of the excise tax could result in additional costs or liabilities.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Special Note Regarding Forward-Looking Statements

This annual report includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements other than statements of historical fact included in this annual report, including statements regarding our financial position, business strategy, ability to complete an Initial Business Combination and the proposed transaction with Aiways Europe, are forward-looking statements. Actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Item 1A. Risk Factors” and elsewhere in this annual report.

Overview

We are a blank check company formed in Delaware on January 13, 2021 for the purpose of effecting an Initial Business Combination. We do not have any operations and have generated no operating revenues to date. Our activities since inception have consisted of organizational activities, activities related to our initial public offering, maintaining our status as a public company, identifying and evaluating prospective target businesses, negotiating business combination terms, and preparing for the proposed transaction with Aiways Europe.

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an Initial Business Combination will be successful.

Business Combination Deadline and Extension Amendments Since our Initial Public Offering, we have held multiple stockholder votes to extend the deadline by which we must complete an Initial Business Combination:

July 17, 2023: Stockholders approved an extension to April 18, 2024, with monthly deposits of $80,000 into the trust account. In connection with this vote, holders of 4,427,969 shares redeemed their shares for approximately $10.43 per share, leaving approximately $25 million in the trust account.

April 17, 2024: Stockholders approved an extension to January 18, 2025, with monthly deposits of $25,000. In connection with this vote, holders of 2,315,868 shares redeemed their shares for approximately $11.10 per share.

July 10, 2024: Stockholders approved an extension to October 18, 2025, with no further monthly deposit requirements. Holders of 3,200 shares redeemed their shares for approximately $11.08 per share.

October 15, 2025: Stockholders approved an extension to July 18, 2026, with no further monthly deposit requirements. Holders of 61,492 shares redeemed their shares for approximately $11.08 per share.

If we do not consummate an Initial Business Combination by July 18, 2026, we will be required to cease all operations except for the purpose of winding up, redeem the outstanding public shares and dissolve and liquidate.

Proposed Business Combination with Aiways Europe

On November 22, 2024, we entered into a Business Combination Agreement with EUROEV Holdings Limited (“Pubco”), Aiways Merger Sub, Inc., Aiways Automobile Europe GmbH (“Aiways Europe”) and Aiways Tech Limited. The proposed transaction remains subject to stockholder approval, effectiveness of the registration statement, and the satisfaction or waiver of customary closing conditions. As disclosed in the Form F-4 filed on March 23, 2026, Pubco has applied to list its ordinary shares on Nasdaq under the symbol “EUEV” in connection with the closing.

Nasdaq Delisting

On January 22, 2025, the Nasdaq Hearings Panel determined to delist our securities from Nasdaq, and trading in our securities was suspended effective January 24, 2025. Nasdaq filed a Form 25 on July 11, 2025. The delisting has reduced the liquidity of our securities and may adversely affect our ability to complete financing transactions and consummate our Initial Business Combination.

Results of Operations

We have neither engaged in any operations nor generated any revenues to date. Our only activities from inception through December 31, 2025 were organizational activities and those necessary to prepare for our initial public offering, described below, and identifying a target for an Initial Business Combination. We do not expect to generate any operating revenues until after the completion of our Initial Business Combination. We generate non-operating income in the form of interest income on marketable securities held after the initial public offering. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the year ended December 31, 2025, we had a net loss of $887,178, which consisted of interest earned on marketable securities held in the trust account of $40,060 and interest earned on operating cash account of $2,105, offset by general and administrative expenses of $581,493 and franchise tax expense of $353,850.

For the year ended December 31, 2024, we had a net loss of $817,025, which consisted of interest earned on marketable securities held in the trust account of $582,231, fair value adjustment on convertible debt of $790, and interest earned on operating cash account of $3,307, offset by general and administrative expenses of $993,775, franchise tax expense of $58,412, loss on overpayment of franchise tax of $172,166, and provision for income taxes of $179,000.

Factors That May Adversely Affect Our Results of Operations

Our results of operations and our ability to complete an Initial Business Combination may be adversely affected by various factors that could cause economic uncertainty and volatility in the financial markets, many of which are beyond our control. Our business could be impacted by, among other things, downturns in the financial markets or in economic conditions, increases in oil prices, inflation, increases in interest rates, supply chain disruptions, declines in consumer confidence and spending, the ongoing effects of the COVID-19 pandemic, including resurgences and the emergence of new variants, and geopolitical instability, such as the military conflict in the Ukraine. We cannot at this time fully predict the likelihood of one or more of the above events, their duration or magnitude or the extent to which they may negatively impact our business and our ability to complete an Initial Business Combination.

Liquidity and Capital Resources

Initial Public Offering and Private Placement

On October 18, 2022, we consummated our Initial Public Offering of 6,000,000 units at $10.00 per unit, generating gross proceeds of $60,000,000. On October 21, 2022, we issued an additional 845,300 units upon the underwriters’ partial exercise of the over-allotment option, generating additional gross proceeds of $8,453,000. Simultaneously with the closing of the Initial Public Offering and the over-allotment closing, the Sponsor purchased 371,500 private placement units for aggregate gross proceeds of $3,715,000.

Following the closing of the Initial Public Offering and partial exercise of the overallotment, an amount of $69,479,795 was placed in a Trust Account in the United States maintained by Continental Stock Transfer & Trust Company, as trustee.

Current Liquidity Position

For the year ended December 31, 2025, cash used in operating activities was $699,875, consisting of a net loss of $881,197, interest received on marketable securities held in the Trust Account of $40,060, a lease payment of $14,397, an increase in accounts payable and accrued expenses of $310,137, a decrease in franchise tax payable of $98,886, that were partially offset by the amortization expense of $27,997, interest expense of $1,331, plus a decrease in prepaid expenses of $1,200.

For the year ended December 31, 2024, cash used in operating activities was $1,081,935, consisting of a net loss of $817,025, interest received on marketable securities held in the Trust Account of $582,231, a lease payment of $20,777, a decrease in accounts payable and accrued expenses of $94,097 and the fair value of related party notes of $790, that were partially offset by the amortization expense of $17,736, interest expense of $123, franchise tax payable of $230,578, and income tax payable of $179,000 , plus a decrease in prepaid expenses of $5,548.

For the year ended December 31, 2025, cash provided by investing activities was $758,613, consisting of cash withdrawn from the Trust Account of $758,613.

For the year ended December 31, 2024, cash provided by investing activities was $25,492,597, consisting of cash withdrawn from the Trust Account of $26,045,551, that was partially offset by an investment of cash in Trust Account of $552,954.

For the year ended December 31, 2025, cash provided by financing activities was $249,965, consisting of cash paid for the redemption of Public Units of $681,347 and the repayment of borrowing due to related parties of $146,025, that were partially offset by cash proceeds from related party borrowing of $701,981 and proceeds from receipt of clawbacked income tax related to redemption of $344,506.

For the year ended December 31, 2024, cash used in financing activities was $24,353,604, consisting of cash paid for the redemption of Public Units of $25,747,589 and the repayment of borrowing due to related parties of $270,000, that were partially offset by cash proceeds from bridge loan of $1,476,882, a cash proceeds from related party borrowing of $187,103.

As of December 31, 2025, we had cash held in the trust account of $406,761. We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned in the trust account to complete our Initial Business Combination. We may withdraw interest to pay taxes. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our Initial Business Combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

As of December 31, 2025, the Company had $346,611 cash held outside of the trust account. We intend to pay the outstanding tax liabilities since the funds are basically from clawbacked income tax related to redemption overpayment, and should be characterized as withdraw from trust account.

Redemption Impact on Public Float and Cash Available In connection with the stockholder votes to extend the deadline to complete an Initial Business Combination, we have experienced significant redemptions of our public shares:

July 2023: 4,427,969 shares redeemed

April 2024: 2,315,868 shares redeemed

July 2024: 3,200 shares redeemed

October 2025: 61,492 shares redeemed

As a result, as of December 31, 2025, only 36,771 public shares remained outstanding, representing a reduction of over 99% of the public shares originally issued in the Initial Public Offering. These redemptions have substantially reduced the amount of cash available in the trust account and have significantly diminished our public float.

Trust Account Depletion

The aggregate amount held in the trust account has decreased materially as a result of the redemptions described above. As of December 31, 2025, the trust account balance was $406,761, compared to approximately $69.5 million immediately following the Initial Public Offering. While we have withdrawn an aggregate of $674,236 from the trust account to pay tax obligations, the primary driver of the reduction has been the payment of redemption proceeds to redeeming public stockholders.

Franchise and Income Tax Withdrawals from Trust Account

Since the completion of its IPO on October 14, 2022, and through December 31, 2025, the Company withdrew $672,843 from the Trust Account in total to pay its liabilities related to the income taxes and Delaware franchise taxes. Through December 31, 2025, the Company remitted $215,265, $236,286 and $216,450 to the Delaware franchise tax authorities to pay its outstanding Delaware franchise tax of the fiscal year 2022, 2023 and 2024, respectively, which resulted in $4,842 in excess of the total withdrawn from the Trust Account not remitted to the tax payments, but held in HUDA’s operating account for upcoming tax payments, including the 2025 franchise tax, and not used for operating expenses. On December 31, 2025, HUDA regained the Certificate of Good Standing from the State of Delaware.

The Company continues to incur further tax liabilities and intends to cover such liabilities from the funds in its operating account, preserved funds for taxes and, if necessary, from the proceeds from the promissory note to Sponsor,

Related-Party Financing

To finance transaction costs and working capital needs, our Sponsor and its affiliates have provided financing through promissory notes and working capital advances. As of December 31, 2025, the principal amount outstanding under related-party promissory notes was $1,115,977. Under the Business Combination Agreement, obligations under Sponsor loans made prior to closing, up to an aggregate of $1.5 million, may be converted into Pubco ordinary shares at $10.00 per share at the closing of the proposed business combination.

Dependence on Transaction Closing

Our liquidity and capital resources are critically dependent upon the successful completion of the proposed Business Combination with Aiways Europe. If the Business Combination is not consummated by July 18, 2026, we will be required to cease all operations, redeem the outstanding public shares, and dissolve and liquidate. In that event, our rights will expire worthless, our founder shares will become worthless, and our public stockholders may receive less than the amount currently held in the trust account on a per-share basis.

Going Concern

We have until July 18, 2026 to consummate an Initial Business Combination. If we are unable to do so, we will be required to liquidate. Because we have no operating revenues, limited cash outside the trust account and a mandatory liquidation date if a business combination is not completed, management has determined that these conditions raise substantial doubt about our ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should we be required to liquidate after the end of the combination period.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of December 31, 2025.

Contractual Obligations

Other than our obligations under related-party promissory notes, a three-year operating lease for a Lexus vehicle effective October 29, 2024, and our deferred underwriting commissions and representative shares payable upon completion of our Initial Business Combination, we do not have material long-term debt, capital lease obligations or other long-term contractual commitments.

As of December 31, 2025, deferred underwriting commissions and representative shares totaled $2,723,060, consisting of cash commissions of $2,395,855 and representative shares issuable in connection with the Initial Public Offering.

Critical Accounting Estimates

The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Our significant accounting estimates include the valuation allowance for deferred tax assets.