Except as set forth herein, this Amendment 1 does
not amend, and should be read together with, the Original 8-K, which remains in full force and effect. Capitalized terms used but not
defined in this Amendment 1 have the meanings given to them in the Original 8-K.
Exhibit
99.3
UNAUDITED
PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The
following unaudited pro forma condensed combined financial statements amend and restate in their entirety the unaudited pro forma condensed
combined financial statements filed as Exhibit 99.3 of Boxabl’s Current Report on Form 8-K filed with the Securities and Exchange
Commission (“SEC”) on July 23, 2026. The primary purpose of this amendment and restatement is to correct the presentation
of a forward purchase agreement as described in Note –7, to correct the presentation of a material prepaid insurance contract,
and to correct the presentation of material transaction costs associated with the business combination.
Unless
expressly indicated or the context requires otherwise, the terms “BOXABL,” “the Company,” “we,” “us,”
and “our” in this document refer to BOXABL Inc., a Texas corporation, and, where appropriate, its subsidiaries.
The
term “FGMC” refers to FG Merger
Sub II Inc., a Nevada corporation. The term “Combined Company” refers to the surviving public company subsequent to the Business
Combination described herein.
Unless
otherwise indicated, dollar amounts above $1,000 in this Report have been rounded to the nearest thousand, million or billion, as applicable.
The
following unaudited pro forma condensed combined financial information presents the combination of the financial information
of FGMC and BOXABL adjusted to give effect to the Business Combination and other transactions. The following unaudited pro forma condensed
combined financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release
No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses.”
On
August 4, 2025, BOXABL entered into the Merger Agreement, by and among FGMC, Merger Sub and BOXABL.
Description
of the Business Combination
On
August 4, 2025, FGMC, BOXABL and FG Merger Sub II Inc., a Nevada corporation and wholly-owned subsidiary of FGMC (“Merger
Sub”) entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement
provides for a two-step merger transaction (the “Mergers”) in which, first, Merger Sub will merge with and
into BOXABL (the “First Merger”), with BOXABL surviving as a wholly-owned subsidiary of FGMC, and, immediately
thereafter, BOXABL (as the surviving company in the First Merger) will merge with and into FGMC (the “Second Merger”),
with FGMC continuing as the surviving public company (the “Combined Company”). By virtue of the consummation
of the Mergers, the Combined Company will change its name to BOXABL Inc. The Boards of Directors of BOXABL, FGMC, and Merger Sub have
unanimously approved the Merger Agreement and the transactions contemplated thereby. On July 17, 2026, the Mergers were completed (the
“Closing”).
Consideration
The
aggregate merger consideration to be received by BOXABL stockholders is equal to a combination of preferred and common shares of FGMC
that equals a total of $3,500,000,000, each at a deemed value of $10 per share. There is no minimum cash required to close the Merger.
Pursuant
to the Merger Agreement each share of BOXABL common share and preferred shares issued and outstanding immediately prior to the First
Merger shall be converted into the right to receive common share and preferred shares, respectively of the Combined Company pursuant
to exchange ratio defined in the Merger Agreement. The Combined Company common shares and preferred shares will be issued at the closing
of the Second Merger.
The
following summarizes the aggregated value of the Business Combination consideration
| Common stock(1) | |
| 246,524,760 | |
| Preferred stock(2) | |
| 103,475,240 | |
| Value per share | |
$ | 10 | |
| Total share consideration | |
$ | 3,500,000,000 | |
| (1) |
Represents
the shares of common stock of the Combined Company that will be issued and exchanged with the BOXABL common shares outstanding. This
includes shares of common stock of the Combined Company underlying the convertible securities including stock option, restricted
stock units and warrants of BOXABL. |
| |
|
| (2) |
Represents
the Combined Company merger preferred stock that will be issued and exchanged with the BOXABL preferred stock outstanding. |
Closing
Conditions
The
closing of the Mergers is subject to customary closing conditions, including, among others, approval of the transaction by the stockholders
of BOXABL and FGMC, effectiveness of a registration statement on Form S-4 to be filed by FGMC with the SEC in connection with the transaction,
expiration or termination of any applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act, accuracy of representations
and warranties, approval for listing of the Combined Company common stock on Nasdaq or NYSE, absence of any law or order prohibiting
the consummation of the transaction, and other conditions as set forth in the Merger Agreement.
The
Merger Agreement may be terminated and the transactions contemplated thereby abandoned at any time prior to the closing under certain
specified circumstances. Either BOXABL or FGMC may terminate the agreement by written notice if the closing has not occurred on or before
July 31, 2026 (the “Agreement End Date”), provided that the right to terminate on this basis is not available
to any party whose breach of the agreement has proximately caused the failure of the closing to occur by such date. Termination is also
permitted by mutual written consent of the parties, or by either party if a governmental authority enacts a law or order that makes consummation
of the transactions illegal or otherwise prohibits the transaction, so long as the terminating party or its subsidiaries did not cause
such prohibition by their own breach.
On
November 3, 2025, Company entered into an amendment (the “Amendment”) to the Merger Agreement with BOXABL.
Pursuant to the Amendment, the parties to the Merger Agreement agreed to extend the Agreement End Date for the Merger Agreement from
December 31, 2025, to March 31, 2026.
On
April 6, 2026, FGMC and BOXABL entered into an amendment to the Merger Agreement:
| |
(A) |
to
extend the Agreement End Date for the Merger Agreement from March 31, 2026 to July 31, 2026; |
| |
|
|
| |
(B) |
that
the Company and the Acquiror shall jointly enter into agreements, subject to any consent needed from ThinkEquity LLC, or amendments
to existing agreements, providing for the release of any lock-up provisions applicable to the Acquiror Securities owned by the Sponsor
Parties, Paolo Tiramani, Galiano Tiramani, or any of their respective Affiliates, such that such lock-up provisions shall automatically
expire if the Acquiror common stock trades at or above $20.00 at any time, including during intraday trading; |
| |
|
|
| |
(C) |
to
clarify that the definition of Acquiror Securities includes the 8,295,800 rights (for the issuance of 829,580 shares of Acquiror
common stock), each right entitling the holder thereof to receive one-tenth (1/10) of a share of Acquirer common stock upon the consummation
of an initial business combination; and |
| |
|
|
| |
(D) |
to
provide that either the Company or the Acquiror has the right to terminate the Merger Agreement if either party has made a written
request of the other party pursuant to the Merger Agreement and five business days have passed, and the requesting party has not
received a response. |
On
May 6, 2026, FGMC and BOXABL entered into an amendment to the forms of Company Lock-Up Agreement and Sponsor Lock-Up Agreement in the
Merger Agreement in order to implement the above-mentioned lock-up provisions.
Termination
Provisions
Additional
termination rights include the ability for either party to terminate if the required stockholder approvals from either BOXABL or FGMC
are not obtained at their respective stockholder meetings, unless the failure to obtain such approval is due to the action or inaction
of the party seeking termination. The agreement may also be terminated by one party if the other party has committed a material breach
of its representations, warranties, or covenants that would prevent the satisfaction of closing conditions, subject to a cure period
of up to thirty (30) days (or any shorter period remaining before the Agreement End Date) after notice of such breach. Upon termination,
the agreement becomes void and has no further effect, except for certain provisions that expressly survive, and subject to liability
for any willful and material breach or actual fraud occurring prior to termination. Each party is responsible for its own fees and expenses
incurred in connection with the agreement and the contemplated transactions, except as otherwise provided.
Certain
Related Agreements
Sponsor
Support Agreement
Concurrently
with the execution of the Merger Agreement, FGMC, the Sponsor and BOXABL entered into the Sponsor Support Agreement. Pursuant to the
Sponsor Support Agreement, the Sponsor agreed, among other things, (i) to vote in favor of the proposals presented at the FGMC special
meeting, (ii) not to redeem any FGMC common shares owned by it in connection with the transactions contemplated by the Merger Agreement,
and (iii) waive, to the fullest extent permitted by applicable law and FGMC’s governing documents, any rights to adjustment or
other anti-dilution protections available under the FGMC Charter with respect to the rate at which shares of FGMC preferred stock held
by the Sponsor convert into shares of FGMC common stock in connection with the transactions contemplated by the Merger Agreement. The
Sponsor Support Agreement also includes a provision with respect to the payment by the Sponsor of expenses incurred by FGMC in connection
with the Business Combination in excess of the FGMC Expense Cap. The Sponsor Support Agreement also provides that if there are any amounts
outstanding under any working capital loan extended to FGMC by the Sponsor as of the Closing, then notwithstanding the terms of any such
working capital loan, FGMC will repay such outstanding amounts to the Sponsor at the Closing solely in cash, and not in the form of FGMC
common shares or any other form.
BOXABL
Support Agreement
Concurrently
with the execution of the Merger Agreement, FGMC, BOXABL and certain stockholders of BOXABL entered into the BOXABL Support Agreement.
Pursuant to the BOXABL Support Agreement, certain BOXABL stockholders agreed to, among other things, at any meeting of the stockholders
of BOXABL and in any action by written consent of the stockholders of BOXABL, with respect to the outstanding shares of BOXABL capital
stock held by them, vote in favor of and consent to adopting the Merger Agreement and all other documents and transactions contemplated
thereby, subject to the terms and conditions of the BOXABL Support Agreement. As of the record date for the BOXABL special meeting, such
BOXABL stockholders accounted for approximately 73.79% of the number of then-outstanding shares of BOXABL common stock and approximately
73.79% of the voting power of the then-outstanding shares of BOXABL common stock.
Lock-Up
Agreement
The
Merger Agreement contemplates that, at the Closing, the Combined Company, the Sponsor and certain of the former stockholders of
BOXABL will enter into the Lock-Up Agreements, pursuant to which the parties thereto will agree to restrictions on transfer for up
to one year following the Closing Date with respect to the Lock-Up Shares (as defined in the Lock-Up Agreement), which lock-up,
subject to certain exceptions, will end on the earlier of (i) with respect to 50% of the Lock-up Shares, the earlier of (A) twelve
(12) months following the Closing Date and (B) the date on which the closing price of the Combined Company’s common shares
equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any
twenty (20) trading days within any thirty (30) trading day period commencing after the Closing Date, and (ii) with respect to the
remaining 50% of the Lock-up Shares, twelve (12) months following the Closing Date, or earlier, in each case, if subsequent to the
Closing Date, FGMC consummates a subsequent liquidation, merger, capital stock exchange, reorganization or other similar transaction
that results in all of FGMC’s stockholders having the right to exchange their shares of common stock for cash, securities or
other property. Notwithstanding the foregoing, such lock-up provisions shall automatically expire if the Combined Company’s
common stock trades at or above $20.00 at any time, including during intraday trading.
Forward
Purchase Agreement
On
May 28, 2026, the Company entered into an OTC Equity Prepaid Forward Transaction (the “Forward Purchase Agreement”) with
a counterparty pursuant to which the counterparty intended, but was not obligated, to purchase and hold up to 3,000,000 shares of the
Company’s common stock prior to the closing of the Mergers. See Note 7 -– Forward Purchase Agreement for more details.
Anticipated
Accounting Treatment
The
Business Combination will be accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, FGMC,
who is the legal acquirer, will be treated as the “acquired” company for accounting purposes and BOXABL will be treated as
the accounting acquirer. Accordingly, the Business Combination will be treated as the equivalent of BOXABL issuing shares at the closing
of the Business Combination for the net assets of FGMC as of the closing date, accompanied by a recapitalization. The net assets of FGMC
will be stated at historical cost, with no goodwill or other intangible assets recorded.
BOXABL
has been determined to be the accounting acquirer based on evaluation of the following facts and circumstances:
| |
● |
BOXABL
stockholders will have the majority voting interest in the Combined Company. |
| |
|
|
| |
● |
The
Combined Company board of directors will be composed as follows: BOXABL will have the right to designate four (4) directors and FGMC
will have the right to designate one (1) director (a majority of the board who will qualify as independent directors under the Securities
Act and the Nasdaq rules); |
| |
|
|
| |
● |
BOXABL
senior management will be the senior management of the Combined Company post-merger; |
| |
|
|
| |
● |
The
business of Combined Company will comprise the ongoing operations of BOXABL; and |
| |
|
|
| |
● |
BOXABL
is the larger entity, in terms of substantive assets. |
Basis
of Pro Forma Presentation
The
unaudited pro forma condensed combined financial information has been prepared reflecting the actual redemption of 3,466,086 shares of
FGMC Public Shares in connection with the Closing, as follows:
| |
● |
Scenario
1 — Actual Redemption Scenario: The “Actual Redemption Scenario” reflects the actual redemption
of 3,466,086 shares of FGMC Public Shares in connection with the Closing, resulting in an aggregate cash payment of approximately
$36.0 million out of the trust account based on a redemption price of approximately $10.40 per share. |
The
pro forma condensed financial statements have been prepared assuming no PIPE financing since there is no minimum cash closing condition
in the transaction
The
pro forma condensed financial statements have been prepared assuming all common shares of BOXABL including the convertible securities
of BOXABL which includes, stock options, warrants and restricted stock units will exchange into common share of Combined Company at Business
Combination closing and all series of preferred shares of BOXABL will exchange in to preferred shares of Combined Company at Business
Combination closing.
Pro
Forma Ownership
The
table below summarizes the pro forma ownership of Combined Company common stock following the Business Combination, reflecting the actual
redemption of 3,466,086 shares of FGMC Public Shares in connection with the Closing:
| |
● |
Actual
Redemption Scenario: The “Actual Redemption Scenario” reflects the actual redemption of 3,466,086 shares of FGMC
Public Shares in connection with the Closing, resulting in an aggregate cash payment of approximately $36.0 million out of the trust
account based on a redemption price of approximately $10.40 per share. |
The
ownership percentages reflected in the tables below are based upon the number of shares of BOXABL common Stock issued and outstanding
as of March 31, 2026, and are subject to the following additional assumptions:
| |
● |
the
total shares of Combined Company common stock to be issued to holders of BOXABL common stock will be 246,524,760; assuming all Convertible
Securities of BOXABL are also converted into Combined Company common stock |
| |
|
|
| |
● |
the
total shares of Combined Company preferred shares to be issued to holders of BOXABL preferred stock will be 103,475,240; |
| |
|
|
| |
● |
the
beneficial ownership of the Sponsor of 2,000,000 shares FGMC common stock were acquired for an aggregate investment of
$25,000 prior to the IPO. These shares would have become worthless had FGMC not completed a business combination by July 31, 2026
(or during any extension period), as the Sponsor waived any redemption right with respect to those shares; the Business Combination
was completed prior to that date. At the Closing, the Sponsor and affiliates would own a total of 2,273,130 shares of Combined Company
common stock. Such shares have an aggregate market value of approximately $23.1 million based on the closing price of FGMC common
stock of $10.18 on May 1, 2026, the most recent practicable date prior to the date of the accompanying joint proxy statement/prospectus
dated 05/12/2026 on which trading data for FGMC common stock was available; |
| |
|
|
| |
● |
the
beneficial ownership of the Sponsor of 248,300 private placement units, which were acquired for an aggregate investment of $2,483,000
million at the time of the IPO. Each private unit consists of one common share and one private unit right. Each whole
private unit right entitles the holder to convert the right to one-tenth share of common stock. |
| |
|
|
| |
|
Such
units would have expired and been worthless had FGMC not completed a business combination by July 31, 2026 or during any extension
period; the Business Combination was completed prior to that date, and these units converted into Combined Company common stock at
the Closing; |
| |
|
|
| |
● |
The
beneficial ownership of the Sponsor of 1,000,000 $15 private warrants which were acquired for an aggregate investment of $100,000
at the time of the IPO. Each $15 private warrant entitles the holder to purchase one share of common stock at an exercise price of
$15.00 per each share, will be exercisable for a period of 10 years from the date of Business Combination, will be non-redeemable,
and may be exercised on a cashless basis. Additionally, $15 private warrants and the shares issuable upon the exercise of the $15
private warrants are not to be transferable, assignable or salable until after the completion of a Business Combination, subject
to certain limited exceptions. These warrants would have expired and been worthless had FGMC not completed a business combination
by July 31, 2026 or during any extension period; the Business Combination was completed prior to that date. |
If
any of these assumptions are not correct, these percentages will be different.
| | |
Actual
Redemption Scenario | |
| | |
Shares | | |
Percentage | |
| Shares of Combined
Company common stock held by BOXABL stockholders(1) | |
| 246,524,760 | | |
| 68.93 | % |
| Shares of Combined Company
preferred stock held by BOXABL stockholders(2) | |
| 103,475,240 | | |
| 28.93 | % |
| Shares of Combined Company
common shares held by Sponsor and affiliates(3) | |
| 2,273,130 | | |
| 0.64 | % |
| Shares of Combined Company
common stock held by FGMC public stockholders(4 ) | |
| 5,333,914 | | |
| 1.49 | % |
| Shares
of Combined Company common stock held by FGMC Underwriter and Advisor(5 ) | |
| 52,250 | | |
| 0.01 | % |
| Total | |
| 357,659,294 | | |
| 100.00 | % |
| (1) |
Consist
of 246,524,760 common shares of Combined Company received by BOXABL shareholder. This includes 233,833,072 shares exchanged for common
shares holder and 12,691,688 common shares of Combined Company exchanged for convertible securities of BOXABL.
These shares were issued to holders of BOXABL’s outstanding stock options and restricted stock units, at the same exchange
ratio applied to BOXABL common shares. |
| |
|
| (2) |
Represent
the preferred shares of Combined Company received by BOXABL preferred shareholder. |
| |
|
| (3) |
Consist
of 1,402,910 common shares held by Sponsor, 85,390 common shares held by Ramnarain Joseph Jaigobind and 760,000 common shares held
by directors, officers and advisors. Also, include 22,330 and 2,500 common shares held by Sponsor and Ramnarain Joseph Jaigobind,
respectively underlying the private unit rights. The Sponsor’s 1,000,000 $15 private warrants described below are
not included in this share count; per BOXABL’s Current Report on Form 8-K filed July 23, 2026, all outstanding FGMC warrants
were assumed by the Combined Company and remain outstanding, exercisable warrants of the Combined Company (1,000,000 Combined Company
Warrants outstanding as of the Closing Date), and were not converted into or redeemed for Combined Company common stock at the Closing. |
| |
|
| (4) |
Represents
4,533,914 FGMC Public Shares remaining following the actual redemption of 3,466,086 shares in connection with the Closing, and 800,000
common shares underlying Public Rights (each Public Right converts into one-tenth (1/10) of one share of Combined
Company common stock upon completion of the Business Combination) |
| |
|
| (5) |
Consist
of 47,500 common shares underlying Underwriter and Advisor Unit . Also includes 4,750 common shares converted from
rights underlying the Underwriter and Advisor Units (at the same one-tenth (1/10) per right conversion ratio as the Public Rights
described above). |
The
following unaudited Pro Forma condensed combined balance sheet as of March 31, 2026, and the unaudited Pro Forma condensed combined statements
of operations for the three months ended March 31, 2026 and for the year ended December 31, 2025, are based on the historical financial
statements of FGMC and BOXABL, and the related notes for the period ended December 31, 2024 and 2025 . The unaudited Pro Forma
adjustments are based on information currently available, assumptions, and estimates underlying the Pro Forma adjustments and are described
in the accompanying notes. Actual results may differ materially from the assumptions used to present the accompanying unaudited Pro Forma
condensed combined financial statements.
BOXABL
and FGMC
UNAUDITED
PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS
OF MARCH 31, 2026
| | |
| | |
| | |
Actual
Redemption Scenario | |
| (In Thousands, except share amounts) | |
BOXABL
(Historical) | | |
FGMC
(Historical) | | |
Transaction
Accounting Adjustments | | |
| |
Pro
Forma Combined | |
| ASSETS | |
| | |
| | |
| | |
| |
| |
| Current assets: | |
| | | |
| | | |
| | | |
| |
| | |
| Cash and cash
equivalents | |
| 22,256 | | |
| 244 | | |
| 6,293 | | |
A | |
| 28,793 | |
| Short-term
investments | |
| — | | |
| — | | |
| — | | |
| |
| — | |
| Cash, cash equivalents
and short-term investments | |
| 22,256 | | |
| 244 | | |
| 6,293 | | |
| |
| 28,793 | |
| Accounts receivable | |
| 1,127 | | |
| — | | |
| — | | |
| |
| 1,127 | |
| Prepaid expenses | |
| — | | |
| 74 | | |
| 3,689 | | |
B | |
| 3,763 | |
| Cash held in trust account | |
| — | | |
| 82,860 | | |
| (46,960 | ) | |
A | |
| — | |
| | |
| | | |
| | | |
| (35,900 | ) | |
A | |
| | |
| Loan receivable –
current | |
| 16 | | |
| — | | |
| — | | |
| |
| 16 | |
| Escrow receivable | |
| 189 | | |
| — | | |
| — | | |
| |
| 189 | |
| Inventories, net | |
| 18,177 | | |
| — | | |
| — | | |
| |
| 18,177 | |
| Other
current assets | |
| 1,026 | | |
| — | | |
| — | | |
| |
| 1,026 | |
| Total
current assets | |
| 42,791 | | |
| 83,178 | | |
| (72,878 | ) | |
| |
| 53,091 | |
| | |
| | | |
| | | |
| | | |
| |
| | |
| Non-current assets: | |
| | | |
| | | |
| | | |
| |
| | |
| Long-term investments | |
| — | | |
| — | | |
| — | | |
| |
| — | |
| Restricted cash | |
| 3,987 | | |
| — | | |
| — | | |
| |
| 3,987 | |
| Property and equipment,
net | |
| 6,864 | | |
| — | | |
| — | | |
| |
| 6,864 | |
| Digital assets | |
| 696 | | |
| — | | |
| — | | |
| |
| 696 | |
| Intangible assets, net | |
| 346 | | |
| — | | |
| — | | |
| |
| 346 | |
| Right of use assets, net | |
| 5,773 | | |
| — | | |
| — | | |
| |
| 5,773 | |
| Deposits on equipment | |
| 268 | | |
| — | | |
| — | | |
| |
| 268 | |
| Loan receivable –
non-current | |
| 20 | | |
| — | | |
| — | | |
| |
| 20 | |
| Security deposits | |
| 854 | | |
| — | | |
| — | | |
| |
| 854 | |
| Other long term assets | |
| 59 | | |
| — | | |
| — | | |
| |
| 59 | |
| Total
non-current assets | |
| 18,867 | | |
| — | | |
| — | | |
| |
| 18,867 | |
| Total
assets | |
| 61,658 | | |
| 83,178 | | |
| (72,878 | ) | |
| |
| 71,958 | |
| | |
| | | |
| | | |
| | | |
| |
| | |
| LIABILITIES AND STOCKHOLDERS’
EQUITY | |
| | | |
| | | |
| | | |
| |
| | |
| Current liabilities: | |
| | | |
| | | |
| | | |
| |
| | |
| Accounts payable | |
| 1,720 | | |
| 64 | | |
| | | |
| |
| 1,784 | |
| Tax liability | |
| — | | |
| 299 | | |
| — | | |
| |
| 299 | |
| Customer deposits | |
| 3,287 | | |
| — | | |
| — | | |
| |
| 3,287 | |
| Deferred revenue | |
| 1,809 | | |
| — | | |
| — | | |
| |
| 1,809 | |
| Lease liability –
current | |
| 3,298 | | |
| — | | |
| — | | |
| |
| 3,298 | |
| Subscription liability | |
| 26 | | |
| — | | |
| — | | |
| |
| 26 | |
| Forward purchase agreement
liability, at fair value | |
| | | |
| | | |
| 8,603 | | |
J | |
| 8,603 | |
| Accrued
expenses and other current liabilities | |
| 1,830 | | |
| — | | |
| — | | |
| |
| 1,830 | |
| Total current liabilities | |
| 11,970 | | |
| 363 | | |
| 8,603 | | |
| |
| 20,936 | |
| | |
| | | |
| | | |
| | | |
| |
| | |
| Long-term liabilities: | |
| | | |
| | | |
| | | |
| |
| | |
| Lease
liability – non-current | |
| 2,950 | | |
| — | | |
| — | | |
| |
| 2,950 | |
| Total liabilities | |
| 14,920 | | |
| 363 | | |
| 8,603 | | |
| |
| 23,886 | |
| | |
| | | |
| | | |
| | | |
| |
| | |
| Commitments and contingencies | |
| | | |
| — | | |
| | | |
| |
| | |
| Common stock; $0.0001 par value, subject to
possible redemption, 8,000,000 shares at redemption value | |
| — | | |
| 82,860 | | |
| (46,960 | ) | |
A | |
| — | |
| | |
| | | |
| | | |
| (35,900 | ) | |
A | |
| | |
| Stockholders’ equity: | |
| | | |
| | | |
| | | |
| |
| | |
| Series A preferred stock | |
| 2,566 | | |
| — | | |
| (2,566 | ) | |
E | |
| 10 | |
| | |
| | | |
| | | |
| 10 | | |
E | |
| | |
| Series A-1 preferred stock | |
| 634,479 | | |
| — | | |
| (634,479 | ) | |
E | |
| — | |
| Series A-2 preferred stock | |
| 101,003 | | |
| — | | |
| (101,003 | ) | |
E | |
| — | |
| Series A-3 preferred stock | |
| 77,165 | | |
| — | | |
| (77,165 | ) | |
E | |
| — | |
| Unclassified preferred
stock | |
| — | | |
| — | | |
| — | | |
| |
| — | |
| Common stock | |
| 30 | | |
| — | | |
| — | | |
C | |
| 25 | |
| | |
| | | |
| | | |
| (30 | ) | |
D | |
| | |
| | |
| | | |
| | | |
| 25 | | |
D | |
| | |
| Additional paid-in capital | |
| 15,058 | | |
| — | | |
| 46,960 | | |
C | |
| 846,103 | |
| | |
| | | |
| | | |
| 815,203 | | |
E | |
| | |
| | |
| | | |
| | | |
| (45 | ) | |
F | |
| | |
| | |
| | | |
| | | |
| 5 | | |
G | |
| | |
| | |
| | | |
| | | |
| (31,078 | ) | |
H | |
| | |
| Accumulated other comprehensive income (loss) | |
| — | | |
| — | | |
| — | | |
| |
| — | |
| | |
| | | |
| | | |
| | | |
| |
| | |
| Accumulated deficit | |
| (783,563 | ) | |
| (45 | ) | |
| 45 | | |
F | |
| (798,066 | ) |
| | |
| | | |
| | | |
| (8,603 | ) | |
J | |
| | |
| | |
| | | |
| | | |
| (5,900 | ) | |
K | |
| | |
| Total
stockholders’ equity | |
| 46,738 | | |
| (45 | ) | |
| 1,379 | | |
| |
| 48,072 | |
| Total
liabilities and stockholders’ equity | |
| 61,658 | | |
| 83,178 | | |
| (72,878 | ) | |
| |
| 71,958 | |
Transaction
Adjustments:
| A |
Reflects
the liquidation and reclassification of funds held in the trust account to cash that became available following the Business Combination,
reflecting the actual redemption of 3,466,086 shares of FGMC Public Shares in connection with the Closing. Amount is net of forward
purchase agreement and transaction costs accounted for separately in notes B,H, K and J. |
| |
|
| B |
Represents
the capitalization of the remaining balance of $3,687,771 in directors’ and officers’ liability insurance premiums placed
through HUB International in connection with the Business Combination. |
| |
|
| C |
Represents
the reclassification of FGMC’s common stock subject to possible redemption to permanent equity, reflecting the actual redemption
of 3,466,086 shares in connection with the Closing. |
| |
|
| D |
Represents
the exchange of outstanding BOXABL common shares into 246,524,760 shares of Combined Company at par value of $0.0001 per share upon
the closing of Business Combination. This amount includes the BOXABL convertible securities including Stock Option, Warrants and
Restricted Stock Units being exchanged for common shares. |
| |
|
| E |
Represents
the exchange of outstanding BOXABL preferred shares into 103,475,240 shares of Combined Company preferred shares at par value of
$0.0001 per share upon the Business Combination. |
| |
|
| F |
Represents
the elimination of FGMC historical accumulated earnings. |
| |
|
| G |
Represents
the conversion of public rights, rights underlying the private units, rights underlying the Underwriter and Advisors Units into Combined
Company’s common stock upon Business Combination. |
| |
|
| H |
Represents
the recognition of the prepayment of the Forward Purchase Agreement of $31,078,060. |
| |
|
| J |
Represents
a change in the fair value of the Forward Purchase Agreement accounted for as a derivative financial instrument under ASC 815 which
is measured at fair value with changes in fair value recognized in earnings. As of May 28, 2026, the Company recorded $8,603,256
loss on the initial recognition of the Forward Purchase Agreement. This adjustment reflects the required payment to the counterparty
upon completion of the Business Combination pursuant to the terms of the Forward Purchase Agreement, which will require final settlement
of this amount within 90 days of the completion of the Business Combination, subject to two additional 90-day extensions at the Company’s
option. |
| |
|
| K |
Represents
$5,900,381 of transaction costs directly attributable to the Business Combination, paid at Closing and recorded as a reduction of
Accumulated Deficit in accordance with ASC 805. These costs include fees paid to Continental Stock Transfer & Trust Company,
ThinkEquity LLC, Loeb & Loeb LLP, Advantage Proxy, Holland & Hart LLP, Toppan Merrill, Winston & Strawn LLP, Maxim Group
LLC, and Brownstein Hyatt Farber Schreck LLP |
BOXABL
and FGMC
UNAUDITED
PRO FORMA CONDENSED COMBINED STATEMENT OF PROFIT OR LOSS
FOR
THE THREE MONTHS ENDED MARCH 31, 2026
| | |
| | |
| | |
Actual Redemption
Scenario | | |
| |
| |
| (In thousands, except per share and weighted-average
share data) | |
BOXABL
(Historical) | | |
FGMC
(Historical) | | |
Transaction
Accounting Adjustments | | |
| |
Pro
Forma Combined | |
| Revenues | |
| 1,556 | | |
| — | | |
| — | | |
| |
| 1,556 | |
| Cost of goods sold | |
| 4,909 | | |
| — | | |
| — | | |
| |
| 4,909 | |
| Gross loss | |
| (3,353 | ) | |
| — | | |
| — | | |
| |
| (3,353 | ) |
| Operating expenses: | |
| | | |
| | | |
| | | |
| |
| | |
| General and administrative | |
| 3,189 | | |
| 273 | | |
| (273 | ) | |
H | |
| 3,270 | |
| | |
| | | |
| | | |
| 81 | | |
B | |
| | |
| Sales and marketing | |
| 525 | | |
| — | | |
| — | | |
| |
| 525 | |
| Research and development | |
| 566 | | |
| — | | |
| — | | |
| |
| 566 | |
| Impairment loss | |
| — | | |
| — | | |
| — | | |
| |
| — | |
| Total
operating expenses | |
| 4,280 | | |
| 273 | | |
| (192 | ) | |
| |
| 4,361 | |
| Loss from operations | |
| (7,633 | ) | |
| (273 | ) | |
| 192 | | |
| |
| (7,714 | ) |
| Other income: | |
| | | |
| | | |
| | | |
| |
| | |
| Interest income | |
| 209 | | |
| 722 | | |
| (722 | ) | |
I | |
| 209 | |
| Other expense | |
| (155 | ) | |
| — | | |
| — | | |
| |
| (155 | ) |
| Income tax expense | |
| — | | |
| (161 | ) | |
| 161 | | |
I | |
| — | |
| Total
other income: | |
| 54 | | |
| 561 | | |
| (561 | ) | |
| |
| 54 | |
| Net
(loss) income attributed to common stockholders | |
| (7,579 | ) | |
| 288 | | |
| (369 | ) | |
| |
| (7,660 | ) |
| Weighted average common shares outstanding
– basic and diluted | |
| 3,000,000,000 | | |
| | | |
| | | |
| |
| 254,184,054 | |
| Net loss per common share
– basic and diluted | |
| (0.00 | ) | |
| | | |
| | | |
| |
| (0.03 | ) |
| Weighted average non-redeemable common shares outstanding diluted | |
| | | |
| 2,295,800 | | |
| | | |
| |
| | |
| Diluted income per share, redeemable shared | |
| | | |
| (0.04 | ) | |
| | | |
| |
| | |
| Weighted average redeemable common shares outstanding – basic | |
| | | |
| 8,000,000 | | |
| | | |
| |
| | |
| Basic income per share, redeemable shares | |
| | | |
| 0.05 | | |
| | | |
| |
| | |
| Weighted average redeemable common shares outstanding – diluted | |
| | | |
| 8,800,000 | | |
| | | |
| |
| | |
| Diluted income per share, redeemable shares | |
| | | |
| 0.04 | | |
| | | |
| |
| | |
Adjustments
and Reclassifications to Unaudited Pro Forma Condensed Combined Statement of Operations for the three months ended March 31, 2026
| B |
Represents
the straight line amortization of the 3-months ended March 31, 2026 related to the directors’ and officers’ liability
insurance premiums placed through HUB International in connection with the Business Combination. |
| |
|
| H |
Reflects
the elimination of non-recurring FGMC expenses after giving effect to the Business Combination as if it had occurred on January 1, 2025.
This adjustment is non-recurring and is not expected to have a continuing impact on the Combined Company’s future results of
operations. |
| |
|
| I |
Reflects
the elimination of interest income and lax liability on interest income generated from the investments held in the trust account
after giving effect to the Business Combination as if it had occurred on January 1, 2025. This adjustment will have a continuing
impact on the Combined Company’s future results of operations, as the Company will not generate interest income from the trust
account following the Closing. |
BOXABL
and FGMC
UNAUDITED
PRO FORMA CONDENSED COMBINED STATEMENT OF PROFIT OR LOSS
FOR
THE YEAR ENDED DECEMBER 31, 2025
| | |
| | |
| | |
Actual Redemption
Scenario | | |
| |
| |
| (In thousands, except per share and weighted-average
share data) | |
BOXABL
(Historical) | | |
FGMC
(Historical) | | |
Transaction
Accounting Adjustments | | |
| |
Pro
Forma Combined | |
| Revenues | |
| 1,514 | | |
| — | | |
| — | | |
| |
| 1,514 | |
| Cost of goods sold | |
| 17,314 | | |
| — | | |
| — | | |
| |
| 17,314 | |
| Gross loss | |
| (15,800 | ) | |
| — | | |
| — | | |
| |
| (15,800 | ) |
| Operating expenses: | |
| | | |
| | | |
| | | |
| |
| | |
| General and administrative | |
| 14,675 | | |
| 972 | | |
| (972 | ) | |
H | |
| 22,637 | |
| | |
| | | |
| | | |
| 5,900 | | |
K | |
| | |
| | |
| | | |
| | | |
| 2,062 | | |
B | |
| | |
| Sales and marketing | |
| 25,428 | | |
| — | | |
| — | | |
| |
| 25,428 | |
| Research and development | |
| 3,297 | | |
| — | | |
| — | | |
| |
| 3,297 | |
| Impairment loss | |
| | | |
| — | | |
| — | | |
| |
| — | |
| Total
operating expenses | |
| 43,400 | | |
| 972 | | |
| 6,990 | | |
| |
| 51,362 | |
| Loss from operations | |
| (59,200 | ) | |
| (972 | ) | |
| (6,990 | ) | |
| |
| (67,162 | ) |
| Other income: | |
| | | |
| | | |
| | | |
| |
| | |
| Interest income | |
| 1,397 | | |
| 3,037 | | |
| (3,037 | ) | |
I | |
| 1,397 | |
| Other income | |
| 254 | | |
| — | | |
| — | | |
| |
| 254 | |
| Loss on initial recognition of Forward Purchase
Agreement liability | |
| — | | |
| — | | |
| (8,603 | ) | |
J | |
| (8,603 | ) |
| Income tax expense | |
| — | | |
| (638 | ) | |
| 638 | | |
I | |
| — | |
| Total
other income: | |
| 1,651 | | |
| 2,399 | | |
| (11,002 | ) | |
| |
| (6,952 | ) |
| Net (loss) income attributed
to common stockholders | |
| (57,549 | ) | |
| 1,427 | | |
| (17,992 | ) | |
| |
| (74,114 | ) |
| Weighted average common shares outstanding
– basic and diluted | |
| 3,000,000,000 | | |
| | | |
| | | |
| |
| 254,184,054 | |
| Net loss per common share
– basic and diluted | |
| (0.02 | ) | |
| | | |
| | | |
| |
| (0.29 | ) |
| Weighted average redeemable common shares outstanding – basic | |
| | | |
| 7,342,466 | | |
| | | |
| |
| | |
| Basic income per share, redeemable shares | |
| | | |
| 0.26 | | |
| | | |
| |
| | |
| Weighted average redeemable common shares outstanding – diluted | |
| | | |
| 8,076,712 | | |
| | | |
| |
| | |
| Basic income per share, non-redeemable shares | |
| | | |
| 0.23 | | |
| | | |
| |
| | |
| Weighted average non-redeemable common shares outstanding – basic | |
| | | |
| 2,301,899 | | |
| | | |
| |
| | |
| Basic loss per non-redeemable share –
basic | |
| | | |
| (0.21 | ) | |
| | | |
| |
| | |
| Weighted average non-redeemable common shares outstanding – diluted | |
| | | |
| 2,329,047 | | |
| | | |
| |
| | |
| Basic and diluted loss per non-redeemable share | |
| | | |
| (0.20 | ) | |
| | | |
| |
| | |
Adjustments
and Reclassifications to Unaudited Pro Forma Condensed Combined Statement of Operations for the year ended December 31, 2025
| B |
Represents
the capitalization of the remaining balance of $3,687,771 in directors’ and officers’ liability insurance premiums placed
through HUB International in connection with the Business Combination. |
| |
|
| H |
Reflects
the elimination of non-recurring FGMC expenses after giving effect to the Business Combination as if it had occurred on January 1, 2025.
This adjustment is non-recurring and is not expected to have a continuing impact on the Combined Company’s future results of
operations. |
| |
|
| I |
Reflects
the elimination of interest income and lax liability on interest income generated from the investments held in the trust account
after giving effect to the Business Combination as if it had occurred on January 1, 2025. This adjustment will have a continuing
impact on the Combined Company’s future results of operations, as the Company will not generate interest income from the trust
account following the Closing. |
| |
|
| J |
Reflects
the fair value of Forward Purchase Agreement accounted for as a derivative financial instrument as per ASC 815 where changes in fair
value are recognized in earnings. This is a non-recurring transaction accounting adjustment and is not expected to have a continuing
impact on the Combined Company’s results of operations. |
| |
|
| K |
Represents
the accrual of additional transaction costs of $5,900,381 incurred subsequent to December 31, 2025; these costs were incurred and
paid in the month ending July 31, 2026, and are reflected only in the pro forma statement of operations for the year ended December
31, 2025. This adjustment is non-recurring and is not expected to have a continuing impact on the Combined Company’s future
results of operations |
NOTES
TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
Note
1 — Description of the Business Combination
On
August 4, 2025, FGMC, BOXABL and FG Merger Sub II Inc., a Nevada corporation and wholly-owned subsidiary of FGMC (“Merger
Sub”) entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement
provides for a two-step merger transaction (the “Mergers”) in which, first, Merger Sub will merge with and
into BOXABL (the “First Merger”), with BOXABL surviving as a wholly-owned subsidiary of FGMC, and, immediately
thereafter, BOXABL (as the surviving company in the First Merger) will merge with and into FGMC (the “Second Merger”),
with FGMC continuing as the surviving public company (the “Combined Company”). By virtue of the consummation
of the Mergers, the Combined Company will change its name to BOXABL Inc. The Boards of Directors of BOXABL, FGMC, and Merger Sub have
unanimously approved the Merger Agreement and the transactions contemplated thereby. On July 17, 2026, the Mergers were completed (the
“Closing”).
Consideration
The
aggregate merger consideration to be received by BOXABL stockholders is equal to a combination of preferred and common shares of FGMC
that equals a total of $3,500,000,000, each at a deemed value of $10 per share. There is no minimum cash required to close the Merger.
| Common Stock(1) | |
| 246,524,760 | |
| Preferred stock(2) | |
| 103,475,240 | |
| Value per share | |
$ | 10 | |
| Total share consideration | |
$ | 3,500,000,000 | |
| (1) |
Represents
the Combined Company common stock that will be issued and exchanged with the BOXABL common stock outstanding. This includes shares
of common stock of the Combined Company underlying the convertible securities including stock option, restricted stock units and
warrants of BOXABL. |
| |
|
| (2) |
Represents
the Combined Company Merger Preferred Stock that will be issued and exchanged with the BOXABL Preferred Stock outstanding. |
Closing
Conditions
The
closing of the Mergers is subject to customary closing conditions, including, among others, approval of the transaction by the stockholders
of BOXABL and FGMC, effectiveness of a registration statement on Form S-4 to be filed by FGMC with the SEC in connection with the transaction,
expiration or termination of any applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act, accuracy of representations
and warranties, approval for listing of the Combined Company common stock on Nasdaq or NYSE, absence of any law or order prohibiting
the consummation of the transaction, and other conditions as set forth in the Merger Agreement.
The
Merger Agreement may be terminated and the transactions contemplated thereby abandoned at any time prior to the closing under certain
specified circumstances. Either BOXABL or FGMC may terminate the agreement by written notice if the closing has not occurred on or before
July 31, 2026 (the “Agreement End Date”), provided that the right to terminate on this basis is not available
to any party whose breach of the agreement has proximately caused the failure of the closing to occur by such date. Termination is also
permitted by mutual written consent of the parties, or by either party if a governmental authority enacts a law or order that makes consummation
of the transactions illegal or otherwise prohibits the transaction, so long as the terminating party or its subsidiaries did not cause
such prohibition by their own breach.
On
November 3, 2025, Company entered into an amendment (the “Amendment”) to the Merger Agreement with BOXABL.
Pursuant to the Amendment, the parties to the Merger Agreement agreed to extend the Agreement End Date for the Merger Agreement from
December 31, 2025, to March 31, 2026.
On
April 6, 2026, FGMC and BOXABL entered into an amendment to the Merger Agreement:
| |
(A) |
to
extend the Agreement End Date for the Merger Agreement from March 31, 2026 to July 31, 2026; |
| |
|
|
| |
(B) |
that
the Company and the Acquiror shall jointly enter into agreements, subject to any consent needed from ThinkEquity LLC, or amendments
to existing agreements, providing for the release of any lock-up provisions applicable to the Acquiror Securities owned by the Sponsor
Parties, Paolo Tiramani, Galiano Tiramani, or any of their respective Affiliates, such that such lock-up provisions shall automatically
expire if the Acquiror common stock trades at or above $20.00 at any time, including during intraday trading; |
| |
|
|
| |
(C) |
to
clarify that the definition of Acquiror Securities includes the 8,295,800 rights (for the issuance of 829,580 shares of Acquiror
common stock), each right entitling the holder thereof to receive one-tenth (1/10) of a share of Acquirer common stock upon the consummation
of an initial business combination; and |
| |
|
|
| |
(D) |
to
provide that either the Company or the Acquiror has the right to terminate the Merger Agreement if either party has made a written
request of the other party pursuant to the Merger Agreement and five Business Days have passed, and the requesting party has not
received a response. |
On
May 6, 2026, FGMC and BOXABL entered into an amendment to the forms of Company Lock-Up Agreement and Sponsor Lock-Up Agreement in the
Merger Agreement in order to implement the above-mentioned lock-up provisions.
Termination
Provisions
Additional
termination rights include the ability for either party to terminate if the required stockholder approvals from either BOXABL or FGMC
are not obtained at their respective stockholder meetings, unless the failure to obtain such approval is due to the action or inaction
of the party seeking termination. The agreement may also be terminated by one party if the other party has committed a material breach
of its representations, warranties, or covenants that would prevent the satisfaction of closing conditions, subject to a cure period
of up to thirty (30) days (or any shorter period remaining before the Agreement End Date) after notice of such breach. Upon termination,
the agreement becomes void and has no further effect, except for certain provisions that expressly survive, and subject to liability
for any willful and material breach or actual fraud occurring prior to termination. Each party is responsible for its own fees and expenses
incurred in connection with the agreement and the contemplated transactions, except as otherwise provided.
Certain
Related Agreements
Sponsor
Support Agreement
Concurrently
with the execution of the Merger Agreement, FGMC, the Sponsor and BOXABL entered into the Sponsor Support Agreement. Pursuant to the
Sponsor Support Agreement, the Sponsor agreed, among other things, (i) to vote in favor of the proposals presented at the FGMC special
meeting, (ii) not to redeem any FGMC common shares owned by it in connection with the transactions contemplated by the Merger Agreement,
and (iii) waive, to the fullest extent permitted by applicable law and FGMC’s governing documents, any rights to adjustment or
other anti-dilution protections available under the FGMC Charter with respect to the rate at which shares of FGMC Preferred Stock held
by the Sponsor convert into shares of FGMC common stock in connection with the transactions contemplated by the Merger Agreement. The
Sponsor Support Agreement also includes a provision with respect to the payment by the Sponsor of expenses incurred by FGMC in connection
with the Business Combination in excess of the FGMC Expense Cap. The Sponsor Support Agreement also provides that if there are any amounts
outstanding under any working capital loan extended to FGMC by the Sponsor as of the Closing, then notwithstanding the terms of any such
working capital loan, FGMC will repay such outstanding amounts to the Sponsor at the Closing solely in cash, and not in the form of FGMC
common Shares or any other form.
BOXABL
Support Agreement
Concurrently
with the execution of the Merger Agreement, FGMC, BOXABL and certain stockholders of BOXABL entered into the BOXABL Support Agreement.
Pursuant to the BOXABL Support Agreement, certain BOXABL stockholders agreed to, among other things, at any meeting of the stockholders
of BOXABL and in any action by written consent of the stockholders of BOXABL, with respect to the outstanding shares of BOXABL capital
stock held by them, vote in favor of and consent to adopting the Merger Agreement and all other documents and transactions contemplated
thereby, subject to the terms and conditions of the BOXABL Support Agreement. As of the record date for the BOXABL special meeting, such
BOXABL stockholders accounted for approximately 73.79% of the number of then-outstanding shares of BOXABL common stock and approximately
73.79% of the voting power of the then-outstanding shares of BOXABL common stock.
Lock-Up
Agreement
The
Merger Agreement contemplates that, at the Closing, the Combined Company, the Sponsor and certain of the former stockholders of BOXABL
will enter into the Lock-Up Agreements, pursuant to which the parties thereto will agree to restrictions on transfer for up to one year
following the Closing Date with respect to the Lock-Up Shares (as defined in the Lock-Up Agreement), which lock-up, subject to certain
exceptions, will end on the earlier of (i) with respect to 50% of the Lock-up Shares, the earlier of (A) twelve (12) months following
the Closing Date and (B) the date on which the closing price of the Combined Company’s common Shares equals or exceeds $12.00 per
share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any twenty (20) trading days within
any thirty (30) trading day period commencing after the Closing Date, and (ii) with respect to the remaining 50% of the Lock-up Shares,
twelve (12) months following the Closing Date, or earlier, in each case, if subsequent to the Closing Date, FGMC consummates a subsequent
liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of FGMC’s stockholders
having the right to exchange their shares of common stock for cash, securities or other property. Notwithstanding the foregoing, such
lock-up provisions shall automatically expire if the Combined Company’s common stock trades at or above $20.00 at any time, including
during intraday trading.
Forward
Purchase Agreement
On
May 28, 2026, the Company entered into an OTC Equity Prepaid Forward Transaction (the “Forward Purchase Agreement”) with
a counterparty pursuant to which the counterparty intended, but was not obligated, to purchase and hold up to 3,000,000 shares of the
Company’s common stock prior to the closing of the Mergers. Further details are discussed in Note 7.
Note
2 — Basis of Presentation and Accounting Policies
The
unaudited Pro Forma condensed combined financial information is for illustrative purposes only. The financial results may have been different
had the companies always been combined. You should not rely on the unaudited Pro Forma condensed combined financial information as being
indicative of the historical results that would have been achieved had the companies always been combined or the future results that
BOXABL will experience. BOXABL and FGMC did not have any historical relationship prior to the Business Combination. Accordingly, no Pro
Forma adjustments were required to eliminate activities between companies.
The
unaudited pro forma condensed combined balance sheet as of March 31, 2026 has been prepared as if the Business Combination occurred
on March 31, 2026. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025
and the unaudited pro forma condensed combined statement of operations for three months ended March 31, 2026 have been prepared
as if the Business Combination occurred on January 1, 2025, the beginning of that fiscal year, consistent with Article 11 of
Regulation S-X.
The
following unaudited Pro Forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation
S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses.”
Release No. 33-10786 replaces the existing Pro Forma adjustment criteria with simplified Pro Forma adjustments that depict the accounting
for the transaction (“Transaction Accounting Adjustments”) and allows optional Pro Forma adjustments
that present the reasonably estimable synergies and other transaction effects that have occurred or are reasonably expected to occur.
BOXABL and FGMC have elected not to present any estimates related to potential synergies and other transaction effects that are reasonably
expected to occur or have already occurred and will only be presenting Transaction Accounting Adjustments in the unaudited Pro Forma
condensed combined financial information.
FGMC
does not meet the definition of a “business” pursuant to ASC 805-10-55 as it is an empty listed shell holding only cash raised
as part of its original equity issuance. As a result, the Business Combination does not qualify as a “business combination”
within the meaning of ASC 805, Business Combinations; rather, the Business Combination will be accounted for as a reverse merger
in accordance with U.S. GAAP. See Note 3 — Accounting for the Business Combination for more details.
The
historical financial statements of BOXABL have been prepared in accordance with U.S. GAAP. The historical financial statements of FGMC
have been prepared in accordance with U.S. GAAP. The unaudited Pro Forma condensed combined financial information reflects U.S. GAAP,
the basis of accounting used by BOXABL.
The
unaudited Pro Forma condensed combined financial information reflects the actual redemption of FGMC’s Public Shares into cash in
connection with the Closing, as more fully described below:
| |
● |
Actual
Redemption: Reflects the actual redemption of 3,466,086 shares of FGMC Public Shares in connection with the Closing, resulting
in an aggregate cash payment of approximately $36.0 million out of the trust account based on a redemption price of approximately
$10.40 per share. |
The
following table sets out share ownership of FGMC common stock on a pro forma basis reflecting the actual redemption of 3,466,086 shares
of FGMC public shares in connection with the Closing:
| | |
Shares | | |
%
holding | |
| FGMC public stockholders(1) | |
| 5,333,914 | | |
| 2.10 | % |
| FGMC Sponsors and affiliates(2) | |
| 2,273,130 | | |
| * | |
| FGMC Common Stock underlying Underwriter Units(3) | |
| 44,000 | | |
| * | |
| FGMC Common Stock underlying Advisor Units(3) | |
| 8,250 | | |
| * | |
| BOXABL stockholders(4) | |
| 246,524,760 | | |
| 96.99 | % |
| Total | |
| 254,184,054 | | |
| 100 | % |
| * |
Less
than 1% |
| |
|
| (1) |
Represents
FGMC Public Shares including the public rights converted into common shares. |
| |
|
| (2) |
Represents
Founder Shares held by Sponsor, Ramnarain Joseph Jaigobind and directors and officers pre-merger of FGMC. It also includes common
stock underlying private units and the rights underlying the private units being converted into common stock. |
| |
|
| (3) |
Represent
the common stock underlying the Underwriters and Advisors Unit including the right being converted into common shares underlying
the Underwriter and Advisor Units. |
| |
|
| (4) |
Represent
the exchange of BOXABL common shares into shares of FGMC upon closing of Business Combination. The amount includes the Convertible
Securities of BOXABL being exchanged for common shares of Combined Company. |
Note
3 — Accounting for the Business Combination
The
Business Combination will be accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, FGMC,
who is the legal acquirer, will be treated as the “acquired” company for accounting purposes and BOXABL will be treated as
the accounting acquirer. Accordingly, the Business Combination will be treated as the equivalent of BOXABL issuing shares at the closing
of the Business Combination for the net assets of FGMC as of the closing date, accompanied by a recapitalization. The net assets of FGMC
will be stated at historical cost, with no goodwill or other intangible assets recorded.
BOXABL
has been determined to be the accounting acquirer based on evaluation of the following facts and circumstances:
| |
● |
BOXABL
stockholders have the majority voting interest in BOXABL; |
| |
|
|
| |
● |
The
BOXABL board will be composed as follows: BOXABL will have the right to designate four (4) directors and FGMC will have the right
to designate one (1) director (a majority of the board who will qualify as independent directors under the Securities Act and the
Nasdaq rules); |
| |
|
|
| |
● |
BOXABL
senior management will be the senior management of BOXABL post-merger; |
| |
|
|
| |
● |
The
business of BOXABL will comprise the ongoing operations of BOXABL; and |
| |
|
|
| |
● |
BOXABL
is the larger entity, in terms of substantive assets. |
Another
determining factor was that FGMC does not meet the definition of a “business” pursuant to ASC 805-10-55, Business Combinations
(“ASC 805”), and thus, for accounting purposes, the Business Combination will be accounted for as a reverse recapitalization,
within the scope of ASC 805. The net assets of FGMC will be stated at historical cost, with no goodwill or other intangible assets recorded.
Note
4 — Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31,
2026
| |
A. |
Reflects
the liquidation and reclassification of funds held in the trust account to cash that became available following the Business Combination,
reflecting the actual redemption of 3,466,086 shares of FGMC Public Shares in connection with the Closing. Amount is net
of forward purchase agreement and transaction costs accounted for separately in notes B,H, K and J. |
| |
|
|
| |
B. |
Represents the
capitalization of $3,687,771 in directors’ and officers’ liability insurance premiums placed through HUB International
in connection with the Business Combination. |
| |
|
|
| |
C. |
Represents
the reclassification of FGMC’s common stock subject to possible redemption to permanent equity, reflecting the
actual redemption of 3,466,086 FGMC shares for an aggregate redemption payment of $36,048,175.57 at
a redemption price of approximately $10.40 per share in connection with the Closing. |
| |
|
|
| |
D. |
Represents
the exchange of outstanding BOXABL common shares into 246,524,760 shares of Combined Company at par value of $0.0001 per share upon
the closing of Business Combination. This amount includes the BOXABL convertible securities including stock options, warrants and
restricted stock units being exchanged for common shares. |
| |
|
|
| |
E. |
Represents
the exchange of outstanding BOXABL preferred shares into 103,475,240 shares of Combined Company Merger preferred stock at par value
of $0.0001 per share upon the Business Combination. |
| |
|
|
| |
F. |
Represents
the elimination of FGMC historical accumulated earnings. |
| |
|
|
| |
G. |
Represents
the conversion of public rights, rights underlying the private units, rights underlying the Underwriter and Advisors Units into Combined
Company’s common stock upon Business Combination |
| |
|
|
| |
H. |
Represents
the recognition of the prepayment of the Forward Purchase Agreement of $31,078,060. |
| |
|
|
| |
J. |
Represents
the fair value of Forward Purchase Agreement liability accounted for as a derivative financial instrument under ASC 815 where changes
in fair value are recognized in earnings. As of May 28, 2026, the Company recorded $8,603,256 loss on the initial recognition of
the Forward Purchase Agreement. This adjustment reflects the required payment to the counterparty upon completion of the Business
Combination pursuant to the terms of the Forward Purchase Agreement, which will require final settlement of this amount within 90
days of the completion of the Business Combination, subject to two additional 90-day extensions at the Company’s option. This
is a non-recurring transaction accounting adjustment and is not expected to have a continuing impact on the Combined Company’s
results of operations. |
| |
K. |
Represents
$5,900,381 of transaction costs directly attributable to the Business Combination, paid at Closing and recorded as a reduction of
Accumulated Deficit in accordance with ASC 805. These costs include fees paid to Continental Stock Transfer & Trust Company,
ThinkEquity LLC, Loeb & Loeb LLP, Advantage Proxy, Holland & Hart LLP, Toppan Merrill, Winston & Strawn LLP, Maxim Group
LLC, and Brownstein Hyatt Farber Schreck LLP |
Note
5 — Adjustments and Reclassifications to Unaudited Pro Forma Condensed Combined Statement of Operations
for the three months ended March 31, 2026 and for the year ended December 31, 2025
The
Pro Forma adjustments included in the unaudited Pro Forma condensed combined statement of operations for the three months ended March
31, 2026 and for the year ended December 31, 2025 are as follows:
| |
B. |
Represents
the straight-line amortization of directors’ and officers’ liability insurance premiums placed through HUB International
in connection with the Business Combination |
| |
|
|
| |
H. |
Reflects
the elimination of non-recurring FGMC expenses after giving effect to the Business Combination as if it had occurred on January 1,
2025. This adjustment is non-recurring and is not expected to have a continuing impact on the Combined Company’s future results
of operations. |
| |
|
|
| |
I. |
Reflects
the elimination of interest income and lax liability on interest income generated from the investments held in the trust account
after giving effect to the Business Combination as if it had occurred on January 1, 2025. This adjustment will have a continuing
impact on the Combined Company’s future results of operations, as the Company will not generate interest income from the trust
account following the Closing. |
| |
|
|
| |
J |
Reflects
the fair value of Forward Purchase Agreement accounted for as a derivative financial instrument as per ASC 815 where changes in fair
value are recognized in earnings. This is a non-recurring transaction accounting adjustment and is not expected to have a continuing
impact on the Combined Company’s results of operations. |
| |
|
|
| |
K. |
Represents
the accrual of additional transaction costs of $5,900,381 incurred subsequent to December 31, 2025; these costs were incurred and
paid in the month ending July 31, 2026, and are reflected only in the pro forma statement of operations for the year ended December
31, 2025. This adjustment is non-recurring and is not expected to have a continuing impact on the Combined Company’s future
results of operations |
Note
6 — Net Earnings per Share
Represents
the earnings per share calculated using the historical weighted average shares outstanding, and the issuance of additional shares in
connection with the Business Combination, assuming the shares were outstanding since January 1, 2025. As the Business Combination
is being reflected as if it had occurred at the beginning of the earliest period presented, the calculation of weighted average
shares outstanding for basic and diluted earnings per share assumes that the shares issued in connection with the Business Combination
have been outstanding for the entire period presented.
The
following table sets out the pro forma dilution of common shares reflecting the actual redemption of 3,466,086 shares of FGMC Public
Shares in connection with the Closing:
| | |
Actual
Redemption | |
| FGMC public shareholders | |
| 5,333,914 | |
| FGMC Sponsors and affiliates(1) | |
| 2,273,130 | |
| FGMC common shares underlying Underwriter Units(2) | |
| 44,000 | |
| FGMC common shares underlying Advisor Units(2) | |
| 8,250 | |
| BOXABL shareholders(3) | |
| 246,524,760 | |
| Total common shares | |
| 254,184,054 | |
| |
(1) |
Represents
Founder Shares held by Sponsor, Ramnarain Joseph Jaigobind and directors and officers pre-merger of FGMC. It also includes the common
stock rights underlying private units and rights underlying the private units being converted into common stock. |
| |
|
|
| |
(2) |
Represent
the common stock underlying the Underwriters and Advisors Unit. |
| |
|
|
| |
(3) |
Represent
the exchange of BOXABL common shares into shares of FGMC upon closing of Business Combination. The amount includes the Convertible
Securities of BOXABL being exchanged for common shares of Combined Company. |
| Year
ended December 31, 2025 | |
Actual
Redemption | |
| Proforma net loss | |
$ | 74,114,000 | |
| Weighted average shares outstanding of common
stock – basic and diluted | |
| 254,184,054 | |
| Net loss per share – basic and diluted | |
| (0.29 | ) |
Note
7 — Forward Purchase Agreement
On
May 28, 2026, the Company entered into an OTC Equity Prepaid Forward Transaction (the “Forward Purchase Agreement”) with
a counterparty pursuant to which the counterparty intended, but was not obligated, to purchase and hold up to 3,000,000 shares of the
Company’s common stock prior to the closing of the Mergers. The Forward Purchase Agreement provides for a cash-settled forward,
funded from the trust account upon closing, and is not indexed to the Company’s own stock in a manner that qualifies for equity
classification under ASC 815-40. Accordingly, the Forward Purchase Agreement is accounted for as a derivative financial instrument, initially
and subsequently measured at fair value, with the initial recognition of and changes in fair value recognized in earnings.
The
unaudited pro forma condensed combined balance sheet as of March 31, 2026 has been adjusted to reflect the loss on initial recognition
of Forward Purchase Agreement liability as if it had been entered into on that date, recorded at its estimated fair value of approximately
$8.6 million as of its inception on May 28, 2026. This adjustment reflects the initial fair value determination only.
Subsequent
to inception, and as disclosed in the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2026, the Company recognized
an additional loss of approximately $1.1 million on the change in fair value of the Forward Purchase Agreement, resulting in a total
derivative liability of approximately $9.6 million as of June 30, 2026. Consistent with SEC guidance on pro forma financial information,
this subsequent change in fair value — which relates to a period following the March 31, 2026 pro forma balance sheet date —
has not been reflected as a pro forma adjustment herein.
