UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(MARK ONE)
For the quarter ended
For the transition period from to
Commission file number:
(Exact Name of Registrant as Specified in Its Charter)
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| ☒ | Smaller reporting company | ||
| Emerging growth company |
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As of August 13, 2025, there were
DYNAMIX CORPORATION
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2025
TABLE OF CONTENTS
i
PART I - FINANCIAL INFORMATION
Item 1. Interim Financial Statements.
DYNAMIX CORPORATION
CONDENSED BALANCE SHEETS
June 30, 2025 | December 31, 2024 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash | $ | $ | ||||||
| Due from Sponsor | ||||||||
| Prepaid expenses | ||||||||
| Total current assets | ||||||||
| Long-term prepaid insurance | ||||||||
| Investments held in Trust Account | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities, Class A Ordinary Shares Subject to Possible Redemption, and Shareholders’ Deficit | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Accrued offering costs | ||||||||
| Over-allotment option liability | ||||||||
| Total current liabilities | ||||||||
| Warrant liability | ||||||||
| Deferred underwriting fee | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies (Note 6) | ||||||||
| Class A ordinary shares subject to possible redemption, | ||||||||
| Shareholders’ Deficit | ||||||||
| Class B ordinary shares, $ | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Shareholders’ Deficit | ( | ) | ( | ) | ||||
| Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption, and Shareholders’ Deficit | $ | $ | ||||||
| (1) |
The accompanying notes are an integral part of the unaudited condensed financial statements.
1
DYNAMIX CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
For the Ended | For the Six Months Ended June 30, 2025 | For the June 30, | ||||||||||
| General and administrative expenses | $ | $ | $ | |||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ||||||
| Other income (expense): | ||||||||||||
| Change in fair value of warrant liabilities | ( | ) | ( | ) | ||||||||
| Interest earned on cash account | ||||||||||||
| Dividends earned on investments held in Trust Account | ||||||||||||
| Change in fair value – over-allotment liability | ||||||||||||
| Total other income, net | ||||||||||||
| Net (loss) income | $ | ( | ) | $ | $ | ( | ) | |||||
| Weighted average redeemable Class A ordinary shares outstanding – basic and diluted | ||||||||||||
| Basic and diluted net (loss) income per share, Class A ordinary shares | $ | ( | ) | $ | $ | |||||||
| Weighted average non-redeemable Class B ordinary shares outstanding – basic and diluted | ||||||||||||
| Basic and diluted net (loss) income per share, Class B ordinary shares | ( | ) | $ | $ | ( | ) | ||||||
The accompanying notes are an integral part of the unaudited condensed financial statements.
2
DYNAMIX CORPORATION
CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT
THREE AND SIX MONTHS ENDED JUNE 30, 2025
(UNAUDITED)
| Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance — December 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Accretion of redeemable Class A ordinary shares to redemption amount | — | — | ( | ) | ( | ) | ||||||||||||||||||||||
| Forfeiture of Founder Shares | — | ( | ) | ( | ) | |||||||||||||||||||||||
| Net income | — | — | ||||||||||||||||||||||||||
| Balance – March 31, 2025 | — | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
| Accretion of redeemable Class A ordinary shares to redemption amount | — | — | ( | ) | ( | ) | ||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||
| Balance – June 30, 2025 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
FOR THE PERIOD FROM JUNE 13, 2024 (INCEPTION) THROUGH JUNE 30, 2024
| Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in | Accumulated | Total Shareholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance — June 13, 2024 (inception) | $ | — | $ | $ | $ | $ | ||||||||||||||||||||||
| Issuance of Founder shares to the Sponsor | — | |||||||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||
| Balance — June 30, 2024 (unaudited) | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
The accompanying notes are an integral part of the unaudited condensed financial statements.
3
DYNAMIX CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
(UNAUDITED)
| For the Six Months Ended June 30, 2025 | For the period from June 13, 2024 (inception) through June 30, 2024 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net income (loss) | $ | $ | ( | ) | ||||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||
| Formation costs paid by Sponsor in exchange for issuance of Class B ordinary shares | ||||||||
| Change in fair value of warrant liabilities | ||||||||
| Change in fair value of over-allotment liability | ( | ) | ||||||
| Dividends earned on investments held in Trust Account | ( | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses | ( | ) | ||||||
| Due from Sponsor | ( | ) | ||||||
| Accounts payable and accrued liabilities | ||||||||
| Net cash used in operating activities | ( | ) | ||||||
| Cash Flows from Financing Activities: | ||||||||
| Cash withdrawn from Trust Account for working capital | ||||||||
| Net cash provided by financing activities | ||||||||
| Net Change in Cash | ( | ) | ||||||
| Cash – Beginning of period | ||||||||
| Cash – End of period | $ | $ | ||||||
| Non-Cash investing and financing activities: | ||||||||
| Forfeiture of Founder Shares | $ | $ | ||||||
| Deferred offering costs included in accrued offering costs | $ | $ | ||||||
| Prepaid expenses paid in exchange for issuance of Class B ordinary shares | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited condensed financial statements.
4
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Dynamix Corporation (the
“Company”) is a blank check company incorporated as a Cayman Islands exempted company on
As of June 30, 2025, the Company had not commenced any operations. All activity for the period from June 13, 2024 (inception) through June 30, 2025 relates to the Company’s formation, the initial public offering (the “Initial Public Offering”), which is described below, and subsequent to the Initial Public Offering, identifying a target company for a Business Combination. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income on cash and cash equivalents from the proceeds derived from the Initial Public Offering.
The registration statement
for the Company’s Initial Public Offering was declared effective on November 20, 2024. On November 22, 2024, the Company consummated
the Initial Public Offering of
Simultaneously with the
closing of the Initial Public Offering, the Company consummated the sale of
Of those
On December 9, 2024, the Company’s Class A ordinary shares and warrants began separately trading from the Units. Those Units not separated will continue to trade on the Nasdaq Global Market under the symbol “DYNXU,” and each of the Class A ordinary shares and warrants that are separated will trade on the Nasdaq Global Market under symbols “DYNX” and “DYNXW,” respectively.
The Company’s Business
Combination must be with one or more target businesses that together have a fair market value equal to at least
5
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
Following the closing of
the Initial Public Offering, on November 22, 2024, an amount of $
The Company will provide
the Company’s public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or against, the
Company’s initial Business Combination, all or a portion of their public shares upon the completion of the initial Business Combination
either (i) in connection with a general meeting called to approve the initial Business Combination or (ii) without a shareholder
vote by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a proposed initial Business
Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public shareholders will be entitled
to redeem their shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated
as of two business days prior to the consummation of the initial Business Combination, including interest earned on the funds held
in the Trust Account (which interest shall be net of taxes payable, if any) and not previously released to the Company, divided by the
number of then outstanding public shares, subject to the limitations. The amount in the Trust Account was initially invested at $
The ordinary shares subject to possible redemption were recorded at a redemption value and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 480, “Distinguishing Liabilities from Equity.” If the Company seeks shareholder approval of the Business Combination, a majority of the issued and outstanding shares voted must be voted in favor of the Business Combination.
The Company will have only
the duration of the Completion Window to complete the initial Business Combination. However, if the Company is unable to complete its
initial Business Combination within the Completion Window, the Company will (i) cease all operations except for the purpose of winding
up, (ii) as promptly as reasonably possible but not more than ten business days thereafter (and subject to lawfully available
funds therefor), redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the
Trust Account, including interest earned on the funds held in the Trust Account (net of permitted withdrawals and less up to $
6
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
The Sponsor, officers and
directors entered into a letter agreement with the Company, pursuant to which they agreed to (i) waive their redemption rights with
respect to their founder shares and public shares in connection with the completion of the initial Business Combination; (ii) waive
their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment
to the Company’s amended and restated memorandum and articles of association (A) to modify the substance or timing of the Company’s
obligation to allow redemption in connection with the initial business combination or to redeem
The Company’s Sponsor
has agreed that it will be liable to the Company if and to the extent any claims by a third party for services rendered or products sold
to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or
other similar agreement or Business Combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $
Risks and Uncertainties
The continuing military conflict between the Russian Federation and Ukraine, the military actions between Hamas and Israel and the risk of escalations of other military conflicts have created and are expected to create global economic consequences. The specific impact on the Company’s financial condition, results of operations, cash flows and completion of a Business Combination is not determinable as of the date of these condensed financial statements.
Liquidity and Capital Resources
As of June 30, 2025, the
Company had $
Prior to the completion
of the Initial Public Offering the Company’s liquidity needs had been satisfied through a loan under an unsecured promissory note
with the Sponsor and the issuance of
In connection with our assessment of going concern considerations in accordance with ASC 205-40 “Presentation of Financial Statements - Going Concern,” the Company has incurred and expects to continue to incur significant costs in pursuit of its financing and acquisition plans. The working capital deficit and the expectation of significant future costs raises substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the unaudited financial statements are issued. Management plans to address this uncertainty through debt or equity financing. The Company will have until 24 months from the closing of the Initial Public Offering (or until such earlier liquidation date as our board of directors may approve) to complete a Business Combination (the “Combination Period”). There is no assurance that the Company’s plans to raise capital or to consummate a Business Combination will be successful within the Combination Period. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
7
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the period ended December 31, 2024, as filed with the SEC on March 20, 2025. The interim results for the three and six months ended June 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025 or for any future periods.
Emerging Growth Company Status
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, is not required to adopt the new or revised standard at the time public companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of Estimates
The preparation of the condensed financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all
short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company had $
8
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
Investments Held in Trust Account
At June 30, 2025 and December
31, 2024, substantially all of the assets held in the Trust Account were held in mutual funds which are invested primarily in money market
funds. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented
on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments
held in the Trust Account are included in dividends earned on investments held in Trust Account in the accompanying statements of operations.
The estimated fair values of investments held in Trust Account are determined using available market information. Fair values of these
investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets. As of June 30,
2025 and December 31, 2024, the Company reported $
The Company may withdrawal
up to
Concentration of Credit Risk
Financial instruments that
potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times,
may exceed the Federal Deposit Insurance Corporation coverage limit of $
Offering Costs
The Company complies with the requirements of the ASC 340-10-S99 and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering.” Offering costs consist principally of professional and registration fees that are related to the Initial Public Offering. FASB ASC 470-20, “Debt with Conversion and Other Options,” addresses the allocation of proceeds from the issuance of convertible debt into its equity and debt components. The Company applies this guidance to allocate Initial Public Offering proceeds from the Units between Class A ordinary shares and warrants, using the residual method by allocating Initial Public Offering proceeds first to assigned value of the warrants and then to the Class A ordinary shares. Offering costs allocated to the Class A ordinary shares were charged to temporary equity, offering costs allocated to the Public Warrants were charged to the statement of operations, while offering costs allocated to the Private Placement Warrants were charged to shareholders’ deficit as the Public Warrants and Private Placement Warrants after management’s evaluation were accounted for under liability and equity treatment, respectively.
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the balance sheets, primarily due to its short-term nature, except for the warrant liabilities (see Note 8).
Income Taxes
The Company accounts for income taxes under ASC Topic 740, “Income Taxes,” which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statements and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company’s management determined that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of June 30, 2025 and December 31, 2024, there were unrecognized tax benefits and no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.
9
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
The Company is considered
to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes
or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was
Derivative Financial Instruments
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value reported in the statement of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date. The underwriters’ over-allotment option is deemed to be a freestanding financial instrument indexed on the contingently redeemable shares and were accounted for as a liability pursuant to ASC 480 since the underwriters partially exercised their overallotment option at the closing of Initial Public Offering.
Warrant Instruments
The Company accounted for the Public and Private Placement Warrants issued in connection with the Initial Public Offering and the private placement in accordance with the guidance contained in FASB ASC Topic 815, “Derivatives and Hedging”. Accordingly, the Company evaluated and classified the Public Warrants under liability treatment and the Private Placement Warrants under equity treatment at their assigned values.
Class A Ordinary Shares Subject to Possible Redemption
The public shares contain
a redemption feature which allows for the redemption of such public shares in connection with the Company’s liquidation, or if there
is a shareholder vote or tender offer in connection with the Company’s initial Business Combination. In accordance with ASC 480-10-S99,
the Company classifies public shares subject to possible redemption outside of permanent equity as the redemption provisions are not solely
within the control of the Company. The Company recognizes changes in redemption value immediately as it occurs and will adjust the carrying
value of redeemable shares to equal the redemption value at the end of each reporting period. Immediately upon the closing of the Initial
Public Offering, the Company recognized the accretion from initial book value to redemption amount value. The change in the carrying value
of redeemable shares will result in charges against additional paid-in capital (to the extent available) and accumulated deficit. Accordingly,
at June 30, 2025 and December 31, 2024, Class A ordinary shares subject to possible redemption is presented at redemption value as temporary
equity, outside of the shareholders’ deficit section of the Company’s balance sheets.
| Shares | Amount | |||||||
| Gross proceeds | $ | |||||||
| Less: | ||||||||
| Proceeds allocated to Public Warrants | ( | ) | ||||||
| Proceeds allocated to over-allotment option | ( | ) | ||||||
| Class A ordinary shares issuance costs | ( | ) | ||||||
| Plus: | ||||||||
| Remeasurement of carrying value to redemption value | ||||||||
| Class A Ordinary Shares subject to possible redemption, December 31, 2024 | ||||||||
| Plus: | ||||||||
| Accretion of redeemable Class A ordinary shares to redemption amount | ||||||||
| Class A Ordinary Shares subject to possible redemption, March 31, 2025 | ||||||||
| Plus: | ||||||||
| Accretion of redeemable Class A ordinary shares to redemption amount | ||||||||
| Class A Ordinary Shares subject to possible redemption, June 30, 2025 | $ | |||||||
10
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
Share-Based Compensation
The Company records share-based compensation in accordance with FASB ASC Topic 718, “Compensation-Share Compensation” (“ASC 718”), guidance to account for its share-based compensation. It defines a fair value-based method of accounting for an employee share option or similar equity instrument. The Company recognizes all forms of share-based payments at their fair value on the grant date, which are based on the estimated number of awards that are ultimately expected to vest. The compensation expense to be recorded will be the difference between the fair value of the Class B ordinary shares sold to each of the purchasers and the cash consideration exchange as a result of the assignment or transfer. The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. If an award is granted, but vesting does not occur, any previously recognized compensation cost is reversed in the period related to the termination of service. Share-based compensation expenses will be included in costs and operating expenses depending on the nature of the services provided in the statement of operations. Subsequent measurement of fair value of the share-based payment award is not required for share-based payment awards meeting the conditions for equity classification.
Net (Loss) Income Per Ordinary Share
The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company has two classes of ordinary shares, which are referred to as redeemable Class A ordinary shares and non-redeemable Class B ordinary shares. Income and losses are shared pro rata between the two classes of ordinary shares. This presentation assumes a Business Combination as the most likely outcome. Net (loss) income per ordinary share is calculated by dividing the net (loss) income by the weighted average ordinary shares outstanding for the respective period.
The following tables present a reconciliation of the numerator and denominator used to compute basic and diluted net (loss) income per ordinary share for each class of ordinary shares:
| For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2025 | For the Period from June 13, 2024 (Inception) Through June 30, 2024 | ||||||||||||||||||||||
| Redeemable Class A | Redeemable Class B | Redeemable Class A | Redeemable Class B | Redeemable Class A | Redeemable Class B | |||||||||||||||||||
| Basic and Diluted net (loss) income per ordinary share | ||||||||||||||||||||||||
| Numerator: | ||||||||||||||||||||||||
| Allocation of net (loss) income | $ | ( | ) | $ | ( | ) | $ | $ | $ | $ | ( | ) | ||||||||||||
| Denominator: | ||||||||||||||||||||||||
| Basic and diluted weighted average ordinary shares outstanding | ||||||||||||||||||||||||
| Basic and diluted net (loss) income per ordinary share | $ | ( | ) | $ | ( | ) | $ | $ | $ | $ | ( | ) | ||||||||||||
Recent Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
Management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements.
11
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 3. INITIAL PUBLIC OFFERING
Pursuant to the Initial
Public Offering, on November 22, 2024, the Company sold
In connection with the completion
of the Business Combination, each holder of Public Warrants will have the right to require the Sponsor to repurchase or cause one of its
affiliates to repurchase, at $
Warrants — As
of June 30, 2025 and December 31, 2024, there were
The Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the Class A ordinary shares underlying the warrants is then effective and a prospectus relating thereto is current, or a valid exemption from registration is available. No warrant will be exercisable and the Company will not be obligated to issue a Class A ordinary share upon exercise of a warrant unless the Class A ordinary share issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In no event will the Company be required to net cash settle any warrant. In the event that a registration statement is not effective for the exercised warrants, or a valid exemption from registration is not available, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit solely for the Class A ordinary share underlying such unit.
Under the terms of the warrant
agreement, the Company has agreed that, as soon as practicable, but in no event later than
If the holders exercise their Public Warrants on a cashless basis, they would pay the warrant exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the “fair market value” of the Class A ordinary shares over the exercise price of the warrants by (y) the fair market value. The “fair market value” is the average reported closing price of the Class A ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of exercise is received by the warrant agent or on which the notice of redemption is sent to the holders of warrants, as applicable.
Redemption of Warrants
When the Price per Class A Ordinary Share Equals or Exceeds $
| ● | in whole and not in part; |
| ● | at a price of $ |
12
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
| ● | upon a minimum of |
| ● | if, and only if, the closing price of the Class A ordinary shares equals or exceeds $ |
Additionally, if the number
of outstanding Class A ordinary shares is increased by a share capitalization payable in Class A ordinary shares, or by a subdivision
of ordinary shares or other similar event, then, on the effective date of such share capitalization, subdivision or similar event, the
number of Class A ordinary shares issuable on exercise of each warrant will be increased in proportion to such increase in the outstanding
ordinary shares. A rights offering made to all or substantially all holders of ordinary shares entitling holders to purchase Class A
ordinary shares at a price less than the fair market value will be deemed a share capitalization of a number of Class A ordinary
shares equal to the product of (i) the number of Class A ordinary shares actually sold in such rights offering (or issuable
under any other equity securities sold in such rights offering that are convertible into or exercisable for Class A ordinary shares)
and (ii) the quotient of (x) the price per Class A ordinary share paid in such rights offering and (y) the fair market
value. For these purposes (i) if the rights offering is for securities convertible into or exercisable for Class A ordinary
shares, in determining the price payable for Class A ordinary shares, there will be taken into account any consideration received
for such rights, as well as any additional amount payable upon exercise or conversion, and (ii) fair market value means the volume
weighted average price of Class A ordinary shares as reported during the
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the
closing of the Initial Public Offering, the Sponsor and the underwriters purchased an aggregate of
The Private Placement Warrants
are identical to the Public Warrants sold in the Initial Public Offering except that the Private Placement Warrants do not include the
Warrant Put Right (as mentioned above), and, so long as they are held by the Sponsor, the underwriters, or their permitted transferees,
the Private Placement Warrants (i) may not (including the Class A ordinary shares issuable upon exercise of these Private Placement
Warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
On June 18, 2024, the
Sponsor made a capital contribution of $
On September 8, 2024, the
Sponsor transferred
13
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
The Founder Shares deemed
transferred to the vice president were granted subject to a service condition (i.e., being part of the Company within one year from the
grant date, October 14, 2024). Stock-based compensation will be recognized ratably from the grant date in four equal quarterly installments
through the first anniversary in an amount equal to the number of Founder Shares times the grant date fair value per share (unless subsequently
modified) less the amount initially received for the deemed purchase of the Founder Shares. The fair value of the
The Company’s initial
shareholders have agreed not to transfer, assign or sell any of their founder shares and any Class A ordinary shares issued upon
conversion thereof until the earlier to occur of (i) one year after the completion of the initial Business Combination or (ii) the
date on which the Company completes a liquidation, merger, share exchange or other similar transaction after the initial Business Combination
that results in all of the Company’s shareholders having the right to exchange their Class A ordinary shares for cash, securities
or other property. Any permitted transferees will be subject to the same restrictions and other agreements of the Company’s initial
shareholders with respect to any founder shares (the “Lock-up”). Notwithstanding the foregoing, if (1) the closing price
of the Class A ordinary shares equals or exceeds $
Promissory Note — Related Party
The Sponsor agreed to loan
the Company an aggregate of up to $
Administrative Services Agreement
The Company entered into
an agreement with an affiliate of the Sponsor, commencing on November 21, 2024 through the earlier of the Company’s consummation
of a Business Combination or its liquidation, to pay an aggregate of $
At June 30, 2025 and December
31, 2024, the Company owed $
Working Capital Loans
In order to fund working
capital deficiencies or finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor
or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (the
“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans.
In the event that a Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account
to repay the Working Capital Loans but no proceeds from the Trust Account would be used to repay the Working Capital Loans. Up to $
14
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 6. COMMITMENTS
Risks and Uncertainties
The United States and global markets are experiencing volatility and disruption following the geopolitical instability resulting from the ongoing Russia-Ukraine conflict and the recent escalation of the Israel-Hamas conflict. In response to the ongoing Russia-Ukraine conflict, the North Atlantic Treaty Organization (“NATO”) deployed additional military forces to eastern Europe, and the United States, the United Kingdom, the European Union and other countries have announced various sanctions and restrictive actions against Russia, Belarus and related individuals and entities, including the removal of certain financial institutions from the Society for Worldwide Interbank Financial Telecommunication payment system. Certain countries, including the United States, have also provided and may continue to provide military aid or other assistance to Ukraine and to Israel, increasing geopolitical tensions among a number of nations. The invasion of Ukraine by Russia and the escalation of the Israel-Hamas conflict and the resulting measures that have been taken, and could be taken in the future, by NATO, the United States, the United Kingdom, the European Union, Israel and its neighboring states and other countries have created global security concerns that could have a lasting impact on regional and global economies. Although the length and impact of the ongoing conflicts are highly unpredictable, they could lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions and increased cyber-attacks against U.S. companies. Additionally, any resulting sanctions could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets.
Any of the above-mentioned factors, or any other negative impact on the global economy, capital markets or other geopolitical conditions resulting from the Russian invasion of Ukraine, the escalation of the Israel-Hamas conflict and subsequent sanctions or related actions, could adversely affect the Company’s search for an initial Business Combination and any target business with which the Company may ultimately consummate an initial Business Combination.
Registration Rights
The holders of the (i) founder shares, which were issued in a private placement prior to the closing of the Initial Public Offering, (ii) Private Placement Warrants which were issued in a private placement simultaneously with the closing of the Initial Public Offering and the Class A ordinary shares underlying such Private Placement Warrants and (iii) Private Placement Warrants that may be issued upon conversion of working capital loans have registration rights to require the Company to register a sale of any of its securities held and any other securities of the Company acquired by them prior to the consummation of the initial Business Combination pursuant to a registration rights agreement signed on the effective date of the Initial Public Offering. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company registers such securities. In addition, the holders have certain piggyback registration rights with respect to registration statements filed subsequent to the completion of the initial Business Combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriters had a
The underwriters were entitled
to a cash underwriting discount of $
Advisory Services Agreement
On February 4, 2025, the
Company entered into an advisory services agreement (the “advisory services agreement”) with Volta (the “service provider”),
an affiliate of the Sponsor owned and controlled by our chief executive officer and chief financial officer. Pursuant to the advisory
services agreement, the service provider will provide management, consulting and other advisory services to the Company in connection
with its initial Business Combination. In consideration for these services, the Company will pay the service provider an annual fee, payable
on a monthly basis, until the consummation of a Business Combination. The Company will also reimburse the service provider and its affiliates
for certain costs and expenses incurred in favor of third parties. Such annual fee, together with any reimbursement, shall not exceed
15
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 7. SHAREHOLDERS’ DEFICIT
Preference Shares — The
Company is authorized to issue a total of
Class A Ordinary
Shares — The Company is authorized to issue a total of
Class B Ordinary
Shares — The Company is authorized to issue a total of
As of June 30, 2025 and
December 31, 2024, there were
The founder shares will
automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of the initial Business
Combination or earlier at the option of the holder on a one-for-one basis, subject to adjustment for share subdivisions, share capitalizations,
reorganizations, recapitalizations and the like, and subject to further adjustment. In the case that additional Class A ordinary
shares, or any other equity-linked securities, are issued or deemed issued in excess of the amounts sold in the Initial Public Offering
and related to or in connection with the closing of the initial Business Combination, the ratio at which Class B ordinary shares
convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary
shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary
shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate,
Holders of record of the
Company’s Class A ordinary shares and Class B ordinary shares are entitled to
There is no cumulative voting
with respect to the appointment of directors, meaning, following the initial Business Combination, the holders of more than
16
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 8. FAIR VALUE MEASUREMENTS
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
| Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. |
| Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. |
| Level 3: | Unobservable inputs based on assessment of the assumptions that market participants would use in pricing the asset or liability. |
The following table presents information about the Company’s assets and liabilities that are measured at fair value as of June 30, 2025 and December 31, 2024, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| Level | June 30, 2025 | December 31, 2024 | |||||||||
| Assets: | |||||||||||
| Investments held in Trust Account | 1 | $ | $ | ||||||||
| Liabilities: | |||||||||||
| Over-allotment option liability | 3 | $ | $ | ||||||||
| Warrant liability – Public Warrants | 1 | $ | $ | ||||||||
At June 30, 2025 and December 31, 2024, investments held in the Trust Account were held in money market funds which are invested primarily in U.S. Treasury securities. The estimated fair values of investments held in Trust Account are determined using available market information. Fair values of these investments are determined by Level 1 inputs utilizing quoted prices (unadjusted) in active markets for identical assets.
The over-allotment option was accounted for as a liability in accordance with ASC 815-40 and was presented within liabilities on the balance sheets. The over-allotment option liability is measured at fair value at inception and on a recurring basis, with changes in fair value presented within changes in fair value of over-allotment option liability in the statement of operations. In January 2025, the underwriters remaining over-allotment option expired unexercised.
The Company used a Black-Scholes model to value the over-allotment option. The over-allotment option liability was classified within Level 3 of the fair value hierarchy at the measurement dates due to the use of unobservable inputs inherent in pricing models are assumptions related to expected share-price volatility, expected life and risk-free interest rate. The Company estimates the volatility of its ordinary shares based on historical volatility that matches the expected remaining life of the option. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the option. The expected life of the option is assumed to be equivalent to their remaining contractual term.
The key inputs into the Black-Scholes model were as follows at December 31, 2024 of the over-allotment option:
| Inputs | December 31, 2024 | |||
| Risk-free interest rate | % | |||
| Expected term (years) | ||||
| Expected volatility | % | |||
| Exercise price | $ | |||
| Fair value of over-allotment unit | $ | |||
The Public Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liability in the accompanying condensed balance sheets. The warrant liability was measured at fair value on a recurring basis, with changes in fair value presented within the statement of operations. The fair value of the Public Warrants was based on unadjusted quoted prices at the close of market as of June 30, 2025 and December 31, 2024.
17
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
The following table provides a summary of the changes in the fair value of the Company’s Level 3 financial instruments that are measured at fair value on a recurring basis:
| Over-allotment option liability | ||||
| Fair value at December 31, 2024 | $ | |||
| Expiration of over-allotment option | ( | ) | ||
| Fair value at March 31, 2025 | ||||
| Expiration of over-allotment option | ||||
| Fair value at June 30, 2025 | $ | |||
NOTE 9. SEGMENT INFORMATION
ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker (“CDOM”), or group, in deciding how to allocate resources and assess performance.
The CODM assesses performance
for the single segment and decides how to allocate resources based on net income or loss that also is reported on the condensed statements
of operations as net income or loss. The measure of segment assets is reported on the condensed balance sheets as total assets.
| June 30, 2025 | December 31, 2024 | |||||||
| Investments held in Trust Account | $ | $ | ||||||
| Cash | $ | $ | ||||||
| For the Three Months Ended June 30, 2025 | For the Six Months Ended June 30, 2025 | For the June 30, | ||||||||||
| General and administrative expenses | $ | $ | $ | |||||||||
| Dividends earned on investments held in Trust Account | $ | $ | $ | |||||||||
The key metrics included in segment profit or loss reviewed by the CODM are dividends earned on investments held in Trust Account and general and administrative expenses. The CODM reviews dividends earned on investments held in Trust Account to measure and monitor shareholder value and determine the most effective strategy of investment with the Trust Account funds while maintaining compliance with the trust agreement. General and administrative expenses are reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a Business Combination within the Combination Period. The CODM also reviews general and administrative costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.
The condensed statement of operations includes other transactions reviewed by the CODM including the change in fair value of warrant liabilities, change in fair value – over-allotment liability, and interest earned on cash. The change in fair value of warrant liabilities and change in fair value – over-allotment liability are both non-cash transactions. The interest earned on cash is monitored to ensure that the Company’s cash is earning a income for the Company.
The accounting policies used to measure the profit and loss of the segment are the same as those described in the summary of significant accounting policies.
18
DYNAMIX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 2025
(Unaudited)
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed financial statements, other than discussed below.
On July 20, 2025, the Company
entered into a letter agreement pursuant to which the underwriters from the Company’s Initial Public Offering agreed, if the closing
of the Business Combination Agreement occurs, (a) that the only consideration due and payable by the Company and its affiliates to the
underwriters pursuant to the underwriting agreement for the Initial Public Offering shall be a one-time cash fee equal to $
On July 21, 2025, the Company and The Ether Machine, Inc., a Delaware corporation (“Pubco”), entered into a Business Combination Agreement (the “Business Combination Agreement”) with ETH SPAC Merger Sub Ltd., a Cayman Islands exempted company and wholly-owned subsidiary of Pubco (“SPAC Merger Sub”), The Ether Reserve LLC, a Delaware limited liability company (the “Ether Reserve”), Ethos Sub 1, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“SPAC Subsidiary A”), Ethos Sub 2, Inc., a Delaware corporation and wholly-owned subsidiary of SPAC Subsidiary A (“SPAC Subsidiary B”), Ethos Sub 3, Inc., a Delaware corporation and wholly-owned subsidiary of SPAC Subsidiary B (“Company Merger Sub”), and ETH Partners LLC, a Delaware limited liability company (the “Seller”).
For additional information regarding the Business Combination Agreement and the transactions contemplated therein, see the Current Report on Form 8-K as filed with the SEC by the Company on July 25, 2025.
Concurrently with the execution
of the Business Combination Agreement, Pubco, the Ether Reserve and the Company entered into subscription agreements (collectively, the
“Equity PIPE Subscription Agreements”) with certain investors (the “Equity PIPE Investors”), pursuant
to which the Equity PIPE Investors agreed to purchase, and Pubco agreed to issue and sell, on the Closing Date, shares of Pubco Class
A Stock (the “Equity PIPE Shares”) for $
19
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
References in this Quarterly Report on Form 10-Q (the “Quarterly Report”) to “we,” “us” or the “Company” refer to Dynamix Corporation. References to our “management” or our “management team” refer to our officers and directors, and references to the “sponsor” refer to DynamixCore Holdings, LLC. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the condensed financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Exchange Act of 1934, as amended (the “Exchange Act”). When used in this Quarterly Report, words such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions, as they relate to us or our management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, our management. No assurance can be given that results in any forward-looking statement will be achieved and actual results could be affected by one or more factors, which could cause them to differ materially. The cautionary statements made in this Quarterly Report should be read as being applicable to all forward-looking statements whenever they appear in this Quarterly Report. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors, including but not limited to, those detailed in our filings with the Securities and Exchange Commission. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by this paragraph. We maintain a corporate website at https://dynamix-corp.com. The information that may be contained on or accessible through our corporate website or any other website that we may maintain is not incorporated by reference in, or otherwise a part of, this report. Except as expressly required by applicable securities law, we disclaim any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Overview
We are a blank check company incorporated in the Cayman Islands on June 13, 2024 formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (the “initial business combination”). We intend to effectuate our business combination using cash derived from the proceeds of the initial public offering and the sale of the private placement warrants, our shares, debt or a combination of cash, shares and debt.
We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a business combination will be successful.
Proposed Business Combination
On July 21, 2025, Dynamix Corporation (the “SPAC”) and The Ether Machine, Inc., a Delaware corporation (“Pubco”), entered into a Business Combination Agreement (the “Business Combination Agreement”) with ETH SPAC Merger Sub Ltd., a Cayman Islands exempted company and wholly-owned subsidiary of Pubco (“SPAC Merger Sub”), The Ether Reserve LLC, a Delaware limited liability company (the “Company”), Ethos Sub 1, Inc., a Delaware corporation and wholly-owned subsidiary of SPAC (“SPAC Subsidiary A”), Ethos Sub 2, Inc., a Delaware corporation and wholly-owned subsidiary of SPAC Subsidiary A (“SPAC Subsidiary B”), Ethos Sub 3, Inc., a Delaware corporation and wholly-owned subsidiary of SPAC Subsidiary B (“Company Merger Sub”), and ETH Partners LLC, a Delaware limited liability company (the “Seller”).
For additional information regarding the Business Combination Agreement and the transactions contemplated therein, see the Current Report on Form 8-K as filed with the SEC by the Company on July 25, 2025.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities from June 13, 2024 (inception) through June 30, 2025 were organizational activities, those necessary to prepare for the initial public offering, described below, and identifying a target company for a 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 dividends earned on investments held in trust account. 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.
20
For the three months ended June 30, 2025, we had a net loss of $248,730, which consisted of dividends earned on investments held in trust account of $1,758,009, interest earned in cash account of $10,732, partially offset by general and administrative expenses of $1,150,121 and change in fair value of warrant liabilities of $867,350.
For the six months ended June 30, 2025, we had a net income of $783,920, which consisted of dividends earned on investments held in trust account of $3,507,375, change in fair value – over-allotment liability of $64,371 and interest earned in cash account of $23,448, partially offset by general and administrative expenses of $1,734,764 and change in fair value of warrant liabilities of $1,076,510.
For the period from June 13, 2024 (inception) through June 30, 2024, we had a net loss of $26,661 which primarily consist of operating and formation costs.
Liquidity and Capital Resources
Until the consummation of the initial public offering, our only source of liquidity was an initial purchase of Class B ordinary shares, par value $0.0001 (the “Class B ordinary shares” or “Founder Shares”), by the sponsor and loans from our sponsor.
On November 22, 2024, we consummated the initial public offering of 16,600,000 Units, at $10.00 per Unit, generating gross proceeds of $166,000,000. Simultaneously with the closing of the initial public offering, we consummated the sale of 5,985,000 private placement warrants at a price of $1.00 per private placement warrant to the sponsor, generating gross proceeds of $5,985,000.
Following the initial public offering, the partial exercise of the over-allotment option, and the sale of the private placement warrants, a total of $166,415,000 was placed in the trust account. We incurred $10,605,256 in initial public offering related costs, including $3,320,000 of cash underwriting fees, $6,640,000 of deferred underwriting fee, and $645,256 of other offering costs.
As an additional source of liquidity, we may withdraw interest earned in the trust account to fund working capital requirements, subject to an annual limit of 10% of interest earned on funds held in the Trust Account.
On February 4, 2025, we entered into an advisory services agreement (the “advisory services agreement”) with Volta Tread LLC, an affiliate of our sponsor owned and controlled by our chief executive officer and chief financial officer (the “service provider”). Pursuant to the advisory services agreement, the service provider will provide management, consulting and other advisory services to the Company in connection with its initial business combination. In consideration for these services, we will (i) pay to the service provider an annual fee, payable on a monthly basis, until the consummation of a business combination, and (ii) reimburse the service provider and its affiliates for certain costs and expenses incurred in favor of third parties. The annual fee, together with any reimbursement, shall not exceed an annual limit of 10% of interest earned on funds held in the trust account (the “Cap”). For the three and six months ended June 30, 2025, the Company has paid the service provider $177,718 and $367,633, respectively, pursuant to the advisory services agreement.
For the six months ended June 30, 2025, net cash used in operating activities was $870,400. Net income of $783,920 was affected by a change in fair value of warrant liabilities of $1,076,510, dividends earned on investments held in trust account of $3,507,375, and change in fair value of over-allotment liability of $64,371. Changes in operating assets and liabilities provided $840,916 of cash from operating activities.
For the period from June 13, 2024 (inception) through June 30, 2024, net cash used in operating activities was $0. Net loss of $26,661 was affected by formation costs paid by Sponsor in exchange for issuance of Class B ordinary shares of $16,241. Changes in operating assets and liabilities provided $10,420 of cash from operating activities.
At June 30, 2025, we had mutual funds which are invested primarily in money market funds held in the trust account of $170,304,723. We intend to use substantially all of the funds held in the trust account (including any amounts representing dividends earned on investments held in trust account, which dividends shall be net of taxes payable, if any, and excluding deferred underwriting fees) and not previously released to us pursuant to permitted withdrawals, to complete our initial business combination. We may withdraw earnings from the trust account to pay taxes, if any. To the extent that our share capital or debt is used, in whole or in part, as consideration to complete a 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.
At June 30, 2025, we had cash of $1,040,643 held outside of the trust account. We intend to use the funds held outside the trust account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete a business combination.
In order to fund working capital deficiencies or finance transaction costs in connection with a business combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. In the event that a business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment. Up to $1,500,000 of such working capital loans may be convertible into private placement warrants of the post business combination entity at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants.
21
In connection with our assessment of going concern considerations in accordance with ASC 205-40 “Presentation of Financial Statements - Going Concern,” we have incurred and expect to continue to incur significant costs in pursuit of its
financing and acquisition plans. The working capital deficit and the expectation of significant future costs raises substantial doubt about our ability to continue as a going concern within one year after the date that the unaudited financial statements are issued. Management plans to address this uncertainty through debt or equity financing. There is no assurance that our plans to raise capital or to consummate a Business Combination will be successful within the Combination Period. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of June 30, 2025. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off- balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual Obligations
We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than an agreement to pay an aggregate of $30,000 per month for office space, utilities, and secretarial and administrative support services commencing on November 21, 2024 through the earlier of the Company’s consummation of a business combination and its liquidation.
In addition, pursuant to the advisory services agreement, we will pay the service provider an annual fee, payable on a monthly basis, until the consummation of a business combination. We will also reimburse the service provider and its affiliates for certain costs and expenses incurred in favor of third parties. The annual fee, together with any reimbursement, shall not exceed the Cap.
On April 1, 2025, we entered into a Master Services Agreement with Avenue Z Inc., under which we will pay $15,000 a month for recurring services related to the preparation, development, and implementation of certain public relations programs and services.
The underwriters were entitled to a cash underwriting fee of $0.20 per Unit, or $3,320,000 in the aggregate. The deferred underwriting fee will become payable to the underwriters, upon the completion of the Company’s initial business combination, from the amounts held in the trust account solely on amounts remaining in the trust account following all properly submitted shareholder redemptions in connection with the consummation of the initial business combination.
Pursuant to a registration rights agreement entered into on November 20, 2024, the holders of the founder shares, private placement warrants and any warrants that may be issued upon conversion of working capital loans (and any Class A ordinary shares issuable upon the exercise of the private placement warrants and warrants that may be issued upon conversion of the working capital loans) will be entitled to registration rights. The holders of the majority of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to completion of a business combination. However, the registration rights agreement provides that we will not permit any registration statement filed under the Securities Act to become effective until termination of the applicable lockup period. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering our securities. We will bear the expenses incurred in connection with the filing of any such registration statements.
Critical Accounting Estimates
The preparation of condensed financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could materially differ from those estimates.
Over-allotment Option
The over-allotment option was accounted for as a liability in accordance with ASC 815-40 and was presented within liabilities on the balance sheets. The over-allotment option liability is measured at fair value on a recurring basis, with changes in fair value presented within changes in fair value of over-allotment option liability in the statement of operations.
The Company used a Black-Scholes model to value the over-allotment option. Valuation of the over-allotment option liability uses significant unobservable inputs related to expected share-price volatility, expected life and risk-free interest rate. The Company estimates the volatility of its ordinary shares based on historical volatility that matches the expected remaining life of the option. Deviations in the assumptions and estimates used could result in materially different fair values and have a material impact to our financial statements.
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Recent Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.
Management does not believe that any other recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed financial statements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Exchange Act, such as this Quarterly Report, is recorded, processed, summarized, and reported within the time period specified in the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including the chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our chief executive officer and chief financial officer (our “certifying officers”), the effectiveness of our disclosure controls and procedures as of June 30, 2025, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our certifying officers concluded that, as of June 30, 2025, our disclosure controls and procedures were effective.
We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Management’s Report on Internal Controls Over Financial Reporting
This Quarterly Report on Form 10-Q does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the fiscal quarter ended June 30, 2025 covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II-OTHER INFORMATION
Item 1. Legal Proceedings.
We are not a party to and none of our property is subject to any material pending legal proceedings.
Item 1A. Risk Factors.
As of the date of this Report, there have been no material changes to the risk factors disclosed in the Company’s Annual Report on Form 10-K filed with the SEC on March 20, 2025.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not Applicable.
Item 5. Other Information
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Item 6. Exhibits
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
| * | Filed herewith. |
| + | Certain schedules, exhibits and similar attachments have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant will provide a copy of such omitted materials to the Securities and Exchange Commission or its staff upon request. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on this 13th day of August 2025.
| DYNAMIX CORPORATION | ||
| By: | /s/ Andrea Bernatova | |
| Name: | Andrea Bernatova | |
| Title: | Chief Executive Officer | |
| (Principal Executive Officer) | ||
| By: | /s/ Nader Daylami | |
| Name: | Nader Daylami | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) | ||
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