Exhibit 99.1
QDRO Acquisition Corp.
INDEX TO FINANCIAL STATEMENT
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Page |
| Financial
Statement of QDRO Acquisition Corp.: |
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| Report of Independent Registered Public Accounting Firm |
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F-2 |
| Balance Sheet as of March 30, 2026 |
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F-3 |
| Notes to Financial Statement |
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F-4 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To the Board of Directors and Shareholders of
QDRO Acquisition Corp.
Opinion on the Financial Statement
We have audited the accompanying balance sheet
of QDRO Acquisition Corp. (the “Company”) as of March 30, 2026, and the related notes (collectively referred to as the “financial
statement”). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Company
as of March 30, 2026, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statement
has been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statement, the Company
does not have sufficient cash and working capital to sustain its operations and the Company’s ability to execute its business plan
is dependent upon its completion of a Business Combination as described in Note 1 to the financial statement. These conditions raise substantial
doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described
in Note 1. The financial statement does not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
This financial statement is the responsibility of the Company’s
management. Our responsibility is to express an opinion on the Company’s financial statement based on our audit. We are a public
accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required
to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations
of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statement is free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we
engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding
of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess
the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to
those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statement.
Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statement. We believe that our audit provides a reasonable basis for our opinion.
/s/ WithumSmith+Brown, PC
We have served as the Company’s auditor
since 2025.
New York, New York
April 6, 2026
QDRO Acquisition Corp.
BALANCE SHEET
MARCH 30, 2026
| Assets: | |
| |
| Current assets | |
| |
| Cash | |
$ | 1,248,410 | |
| Prepaid expenses | |
| 45,103 | |
| Total current assets | |
| 1,293,513 | |
| Cash held in Trust Account | |
| 200,000,000 | |
| Total Assets | |
$ | 201,293,513 | |
| | |
| | |
| Liabilities, Class A Ordinary Shares Subject to Possible Redemption, and Shareholders’ Deficit | |
| | |
| Liabilities: | |
| | |
| Current liabilities | |
| | |
| Accrued offering costs | |
$ | 113,399 | |
| Accrued expenses | |
| 8,476 | |
| Advances from related party | |
| 5 | |
| Total current liabilities | |
| 121,880 | |
| Deferred legal fee | |
| 246,903 | |
| Deferred underwriting fee | |
| 8,000,000 | |
| Total Liabilities | |
| 8,368,783 | |
| | |
| | |
| Commitments and Contingencies (Note 6) | |
| | |
| Class A ordinary shares subject to possible redemption, $0.0001 par value; 20,000,000 shares at redemption value of $10.00 per share | |
| 200,000,000 | |
| | |
| | |
| Shareholders’ Deficit | |
| | |
| Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued or outstanding | |
| — | |
| Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none issued or outstanding (excluding 20,000,000 shares subject to possible redemption) | |
| — | |
| Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 5,000,000 shares issued and outstanding (1) | |
| 500 | |
| Additional paid-in capital | |
| — | |
| Accumulated deficit | |
| (7,075,770 | ) |
| Total Shareholders’ Deficit | |
| (7,075,270 | ) |
| Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption, and Shareholders’ Deficit | |
$ | 201,293,513 | |
| (1) | On March 30, 2026, the underwriters forfeited their over-allotment option. As a result,
750,000 Class B ordinary shares were forfeited, resulting in the Sponsor holding 5,000,000 Class B ordinary shares (see Note 7). |
The accompanying notes are an integral part of
the financial statement.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 1 — Organization and Business
Operations
QDRO Acquisition Corp. (the “Company”)
is a blank check company incorporated as a Cayman Islands exempted corporation on July 28, 2025. The Company was incorporated for
the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business
combination with one or more businesses or entities (the “Business Combination”). The Company has not selected any specific
Business Combination target, and the Company has not, nor has anyone on its behalf, engaged in any substantive discussions, directly or
indirectly, with any Business Combination target with respect to an initial Business Combination with the Company.
As of March 30, 2026, the Company has not commenced
any operations. All activity for the period from July 28, 2025 (inception) through March 30, 2026 relates to the Company’s
formation and the Initial Public Offering (as defined below). 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 from the proceeds derived from the Initial Public Offering (as defined below). The Company has selected December 31 as its
fiscal year end.
The Company’s Sponsor is QDRO Sponsor LLC
(the “Sponsor”). The registration statement for the Company’s Initial Public Offering was declared effective on March
26, 2026. On March 30, 2026, the Company consummated the Initial Public Offering of 20,000,000 units (the “Units”), at $10.00
per Unit, generating gross proceeds of $200,000,000. Each Unit consists of one Class A ordinary share and one-half of one redeemable warrant
(each “Public Warrant” and collectively, the “Public Warrants”). Each whole Public Warrant entitles the holder
thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment.
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the sale of an aggregate of 6,000,000 Private Placement Warrants (each “Private Placement
Warrant”, collectively the “Private Placement Warrants”) at a price of $1.00 per Private Placement Warrant, generating
gross proceeds of $6,000,000. Of those 6,000,000 Private Placement Warrants, the Sponsor purchased 4,000,000 Private Placement Warrants,
and Cantor Fitzgerald & Co., the representative of the underwriters purchased 2,000,000 Private Placement Warrants.
Transaction costs amounted to $12,902,142, consisting of $4,000,000
of cash underwriting fees, $8,000,000 of deferred underwriting fees, and $902,142 of other offering costs.
The Company’s Business Combination must
be with one or more target businesses that together have a fair market value equal to at least 80% of the net balance in the Trust Account
(as defined below) (excluding the amount of deferred underwriting discounts held and taxes payable on the income earned on the Trust Account)
at the time of the signing an agreement to enter into a Business Combination. However, the Company will only complete a Business Combination
if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise
acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment
Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able
to successfully effect a Business Combination.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 1 — Organization and Business
Operations (cont.)
Following the closing of the Initial Public Offering,
on March 30, 2026, an amount of $200,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units and the Private Placement
Warrants was placed in the trust account (the “Trust Account”), with Continental Stock Transfer & Trust Company, acting
as trustee and initially be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in
money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government
treasury obligations; the holding of these assets in this form is intended to be temporary and for the sole purpose of facilitating the
intended business combination. To mitigate the risk that the Company might be deemed to be an investment company for purposes of the Investment
Company Act, which risk increases the longer that the Company holds investments in the Trust Account, the Company may, at any time (based
on the management team’s ongoing assessment of all factors related to the Company’s potential status under the Investment
Company Act), instruct the trustee to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account
in cash or in an interest bearing demand deposit account at a bank. Except with respect to interest earned on the funds held in the Trust
Account that may be released to the Company to pay its taxes and up to $100,000 to pay dissolution expenses, if any, the proceeds from
the Initial Public Offering and the sale of the Private Placement Warrants will not be released from the Trust Account
until the earliest of (i) the completion of the Company’s initial Business Combination, (ii) the redemption of the Company’s
public shares if the Company is unable to complete the initial Business Combination within 18 months from the closing of the Initial
Public Offering or by such earlier liquidation date as the Company’s board of directors may approve (the “Completion Window”),
subject to applicable law, or (iii) the redemption of the Company’s public shares properly submitted in connection with a shareholder
vote to amend the Company’s amended and restated memorandum and articles of association to (A) modify the substance or timing
of the Company’s obligation to allow redemption in connection with the initial Business Combination or to redeem 100% of the Company’s
public shares if the Company has not consummated an initial Business Combination within the Completion Window or (B) with respect
to any other material provisions relating to shareholders’ rights or pre-initial Business Combination activity. The proceeds deposited
in the Trust Account could become subject to the claims of the Company’s creditors, if any, which could have priority over the claims
of the Company’s public shareholders.
The Company will provide the Company’s public
shareholders with the opportunity to redeem 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 (net of amounts withdrawn to fund the Company’s working capital requirements, subject to an annual limit of
$100,000 (plus the rollover of unused amounts from prior years), and/or to pay for the taxes (any withdrawals to pay for the taxes
(which shall exclude any 1% U.S. federal excise tax on stock repurchases under the Inflation Reduction Act of 2022 that
is imposed on us, if any) shall not be subject to the $100,000 annual limitation described in the foregoing)), divided by the number of
then outstanding public shares, subject to the limitations. The amount in the Trust Account is initially anticipated to be $10.00 per
public share.
The ordinary shares subject to redemption will
be 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.”
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 as promptly as reasonably possible but not more than ten business days thereafter,
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 amounts withdrawn to fund the Company’s working capital requirements,
subject to an annual limit of $100,000 (plus the rollover of unused amounts from prior years), and/or to pay for the taxes (any withdrawals
to pay for the taxes (which shall exclude any 1% U.S. federal excise tax on stock repurchases under the Inflation Reduction Act of 2022
that is imposed on us, if any) shall not be subject to the $100,000 annual limitation described in the foregoing), divided by the number
of then outstanding public shares, which redemption will constitute full and complete payment for the public shares and completely extinguish
public shareholders’ rights as shareholders (including the right to receive further liquidation or other distributions, if any),
subject to the Company’s obligations under Cayman Islands law to provide for claims of creditors and subject to the other requirements
of applicable law.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 1 — Organization and Business
Operations (cont.)
The Sponsor, officers and directors have
entered into a letter agreement with the Company, pursuant to which they have 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; (iii) waive their
rights to liquidating distributions from the Trust Account with respect to their founder shares if the Company fails to complete the
initial Business Combination within the Completion Window, although they will be entitled to liquidating distributions from the
Trust Account with respect to any public shares they hold if the Company fails to complete the initial Business Combination within
the Completion Window and to liquidating distributions from assets outside the Trust Account; and (iv) vote any founder shares
held by them and any public shares purchased during or after the Initial Public Offering (including in open market and privately
negotiated transactions, aside from shares they may purchase in compliance with the requirements of Rule 14e-5 under the
Exchange Act, which would not be voted in favor of approving the Business Combination) in favor of the initial Business
Combination.
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) $10.00 per
public share and (ii) the actual amount per public share held in the Trust Account as of the date of the liquidation of the Trust
Account, if less than $10.00 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability
will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies
held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any claims under the Company’s indemnity
of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933,
as amended (the “Securities Act”). However, the Company has not asked the Sponsor to reserve for such indemnification obligations,
nor has the Company independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and the Company
believes that the Sponsor’s only assets are securities of the Company. Therefore, the Company cannot assure that the Sponsor would
be able to satisfy those obligations.
Going Concern Considerations
At March 30, 2026, the Company had $1,248,410 of cash and a working
capital of $1,171,633.
In order to 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 (“Working Capital Loans”). Such Working
Capital Loans would be evidenced by promissory notes. The notes may be repaid upon completion of a Business Combination, without interest,
or, at the lender’s discretion, up to $2,000,000 of the Working Capital Loans may be converted upon completion of a Business Combination
into private placement warrants at a price of $1.00 per warrant. Such private placement warrants would be identical to the Private Placement
Warrants. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account
to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. As of March
30, 2026, there were no Working Capital Loans outstanding.
The Company has since completed its Initial Public Offering at which
time capital in excess of the funds deposited in Trust Account and/or used to fund offering expenses was released to the Company for general
capital purposes. Further, the Company has incurred and expects to continue to incur significant costs in pursuit of its financing and
acquisition plans. In connection with the Company’s assessment of going concern considerations in accordance with FASB ASC 205-40,
“Financial Statement Presentation — Going Concern,” the Company’s management has evaluated the Company’s
liquidity and financial condition, and determined that the Company still lacks the liquidity to sustain operations for a reasonable period
of time, which is considered to be one year from the date of the issuance of the financial statement. These conditions raise substantial
doubt about the Company’s ability to continue as a going concern. Management plans to address this uncertainty with the Business
Combination. There is no assurance that the Company’s plans to complete the Business Combination will be successful. The financial
statement does not include any adjustments that might result from the outcome of this uncertainty.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 2 — Summary of Significant
Accounting Policies
Basis of Presentation
The accompanying financial statement is presented
in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant
to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”).
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, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison
of the Company’s financial statement 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 financial statement in conformity
with U.S. GAAP requires 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 statement. Actual results could differ 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 cash of $1,248,410 and did not have any cash equivalents
as of March 30, 2026.
Cash Held in Trust Account
As of March 30, 2026, the assets held in the Trust
Account, amounting to $200,000,000, were held in cash.
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 $250,000. Any loss incurred or a lack of access to such funds could have a significant
adverse impact on the Company’s financial condition, results of operations, and cash flows.
Deferred Offering Costs
The Company complies with the requirements of
the ASC 340-10-S99 and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering.” Deferred 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.
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 sheet, primarily due to their short-term nature.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 2 — Summary of Significant
Accounting Policies (cont.)
Income Taxes
The Company accounts for income taxes under FASB
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 statement 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.
FASB 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 March 30, 2026,
there were no 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.
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 zero for the period presented.
Warrant Instruments
The Company accounted for the Public and Private
Placement Warrants (defined below) 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”, whereby under that provision, the warrants that
do not meet the criteria for equity treatment must be recorded as liability. Accordingly, the Company evaluated and classified the warrant
instruments under equity treatment at their assigned values.
Share-Based Payment Arrangements
The Company accounts for share awards in accordance
with FASB ASC 718, “Compensation—Stock Compensation,” which requires that all equity awards be accounted for at their
“fair value.” Fair value is measured on the grant date and is equal to the underlying value of the share.
Costs equal to these fair values are recognized
ratably over the requisite service period based on the number of awards that are expected to vest, in the period of grant for awards that
vest immediately and have no future service condition, or in the period the awards vest immediately after meeting a performance condition
becomes probable (i.e., the occurrence of a Business Combination). For awards that vest over time, cumulative adjustments in later periods
are recorded to the extent actual forfeitures differ from the Company’s initial estimates; previously recognized compensation cost
is reversed if the service or performance conditions are not satisfied and the award is forfeited.
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 FASB 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 they occur 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 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,
as of March 30, 2026, Class A ordinary shares subject to possible redemption are presented at redemption value as temporary equity, outside
of the shareholders’ deficit section of the Company’s balance sheet. As of March 30, 2026, the Class A ordinary shares subject
to possible redemption reflected in the balance sheet are reconciled in the following table:
| Gross proceeds | |
$ | 200,000,000 | |
| Less: | |
| | |
| Proceeds allocated to Public Warrants | |
| (2,470,000 | ) |
| Public Shares issuance costs | |
| (12,716,849 | ) |
| Plus: | |
| | |
| Remeasurement of carrying value to redemption value | |
| 15,186,849 | |
| Class A ordinary shares subject to possible redemption, March 30, 2026 | |
$ | 200,000,000 | |
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 2 — Summary of Significant
Accounting Policies (cont.)
Recent Accounting Pronouncements
In November 2023, the FASB issued ASU 2023-07,
Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this ASU require disclosures, on
an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating officer decision maker
(“CODM”), as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss.
The ASU requires that a public entity disclose
the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing
segment performance and deciding how to allocate resources. Public entities will be required to provide all annual disclosures currently
required by Topic 280 in interim periods, and entities with a single reportable segment are required to provide all the disclosures
required by the amendments in this ASU and existing segment disclosures in Topic 280. This ASU is effective for fiscal years
beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early
adoption permitted. The Company adopted ASU 2023-07 on July 28, 2025, inception.
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 financial statement.
Note 3 — Initial Public Offering
Pursuant to the Initial Public Offering on March
30, 2026, the Company sold 20,000,000 Units, at a purchase price of $10.00 per Unit. Each Unit consists of one Class A ordinary share,
and one-half of one redeemable warrant. Each whole warrant entitles the holder to purchase one Class A ordinary share at a price
of $11.50 per share, subject to adjustment. Each warrant will become exercisable 30 days after the completion of the initial Business
Combination and will expire five years after the completion of the initial Business Combination, or earlier upon redemption or liquidation.
Public Warrants — As of
March 30, 2026, there were 16,000,000 Warrants outstanding, including 10,000,000 Public Warrants and 6,000,000 Private Placement Warrants.
Each whole warrant entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment
as discussed herein. The warrants cannot be exercised until 30 days after the completion of the initial Business Combination, and
will expire at 5:00 p.m., New York City time, five years after the completion of the initial Business Combination or earlier
upon redemption or liquidation.
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. 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, the purchaser
of a unit containing such warrants 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 20 business days after the closing of its Business Combination,
it will use commercially reasonable efforts to file with the SEC a post-effective amendment to the registration statement for the Initial
Public Offering or a new registration statement covering the registration under the Securities Act of the Class A ordinary
shares issuable upon exercise of the warrants and thereafter will use its commercially reasonable efforts to cause the same to become
effective within 60 business days following the Company’s initial business combination and to maintain a current prospectus
relating to the Class A ordinary shares issuable upon exercise of the warrants until the expiration of the warrants in accordance
with the provisions of the warrant agreement. If a registration statement covering the Class A ordinary shares issuable upon exercise
of the warrants is not effective by the sixtieth (60th) business day after the closing of the initial Business Combination,
warrant holders may, until such time as there is an effective registration statement and during any period when the Company
will have failed to maintain an effective registration statement, exercise warrants on a “cashless basis” in accordance with
Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if the Class A ordinary shares are
at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a “covered
security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of public warrants
who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities
Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement,
and in the event the Company does not so elect, the Company will use its commercially reasonable efforts to register or qualify the shares
under applicable blue sky laws to the extent an exemption is not available.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 3 — Initial Public Offering
(cont.)
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 $18.00: The Company may redeem the outstanding warrants:
| ● | in whole and not in part; |
| ● | at a price of $0.01 per warrant; |
| ● | upon a minimum of 30 days’ prior written notice of redemption (the “30-day
redemption period”); and |
| ● | if, and only if, the closing price of the Class A ordinary shares equals or exceeds
$18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant) for
any 20 trading days within a 30-trading day period commencing at least 30 days after completion of the Company’s
initial business combination and ending three business days before the Company sends the notice of redemption to the warrant holders. |
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 ten (10) trading day period ending on the trading day prior to the first
date on which the Class A ordinary shares trade on the applicable exchange or in the applicable market, regular way, without the
right to receive such rights.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 4 — Private Placement
Simultaneously with the closing of the Initial
Public Offering, the Company consummated the sale of an aggregate of 6,000,000 Private Placement Warrants at a price of $1.00 per Private
Placement Warrant, generating gross proceeds of $6,000,000. Of those 6,000,000 Private Placement Warrants, the Sponsor purchased 4,000,000
Private Placement Warrants, and Cantor Fitzgerald & Co., the representative of the underwriters purchased 2,000,000 Private Placement
Warrants.
The Private Placement Warrants are identical to
the Public Warrants sold in the Initial Public Offering except that, so long as they are held by the Sponsor, Cantor Fitzgerald &
Co., 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 30 days after the completion of the initial Business Combination, (ii) are entitled to registration rights and (iii) with
respect to private placement warrants held by Cantor Fitzgerald & Co., will not be exercisable more than five years from
the commencement of sales in this offering in accordance with Financial Industry Regulatory Authority (“FINRA”) Rule 5110(g)(8).
The Sponsor, officers and directors have entered
into a letter agreement with the Company, pursuant to which they have 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 100% of the public shares if the Company has not
consummated an initial Business Combination within the Completion Window or (B) with respect to any other material provisions relating
to shareholders’ rights or pre-initial Business Combination activity; (iii) waive their rights to liquidating distributions
from the Trust Account with respect to their founder shares if the Company fails to complete the initial Business Combination within the
Completion Window, although they will be entitled to liquidating distributions from the Trust Account with respect to any public shares
they hold if the Company fails to complete the initial Business Combination within the Completion Window and to liquidating distributions
from assets outside the Trust Account; and (iv) vote any founder shares held by them and any public shares purchased during or after
the Initial Public Offering (including in open market and privately negotiated transactions, aside from shares they may purchase in compliance
with the requirements of Rule 14e-5 under the Exchange Act, which would not be voted in favor of approving the Business Combination)
in favor of the initial Business Combination.
Note 5 — Related Party Transactions
Founder Shares
On July 29, 2025, the Sponsor made a capital
contribution of $25,000, or approximately $0.004 per share, to cover certain of the Company’s expenses, for which the Company issued
5,750,000 founders shares to the Sponsor. Up to 750,000 of the founder shares may be surrendered by the Sponsor for no consideration depending
on the extent to which the underwriters’ over-allotment option is exercised. On March 30, 2026, the underwriter forfeited their
over-allotment option to purchase up to an additional 3,000,000 Units. As a result of the over-allotment option forfeiture by the underwriter,
750,000 Class B ordinary shares of the Company were forfeited by the Sponsor.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 5 — Related Party Transactions
(cont.)
On October 20, 2025, the Sponsor granted membership
interests equivalent to an aggregate of 150,000 founder shares to directors of the Company in exchange for their services through the
Company’s initial Business Combination. The founder shares, represented by such membership interests, will remain with the Sponsor
if the holder of such membership interests are no longer serving the Company prior to the initial Business Combination. The membership
interest assignment of the founder shares to the holders of such interests are in the scope of FASB ASC Topic 718, “Compensation-Stock
Compensation” (“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured
at fair value upon the assignment date. The total fair value of the 150,000 founder shares represented by such membership interests assigned to
the holders of such interests on October 20, 2025 was $540,300 or $3.602 per share. The Company established the fair value of founder
shares transferred on October 20, 2025 using Monte Carlo Simulation Model prepared by a third party valuation firm, which takes into consideration
the following market assumptions; (i) implied share price of $9.79, (ii) probability of De-SPAC and instrument-specific market adjustment
of 37.2%, and (iii) risk-free rate of 4.07%. The founder shares measurement utilized Level 3 inputs at the measurement date due to the
use of unobservable inputs, and other risk factors. The membership interests were assigned subject to a performance condition (i.e., providing
services through Business Combination). Stock-based compensation would be recognized at the date a Business Combination is considered
probable (i.e., upon consummation of a Business Combination) in an amount equal to the number of membership interests that ultimately
vest times the assignment date fair value per share (unless subsequently modified) less the amount initially received for the assignment
of the membership interests. As of March 30, 2026, the Company determined that the initial Business Combination is not considered probable
and therefore no compensation expense has been recognized.
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 $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations
and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the initial Business
Combination or (2) if the Company consummates a transaction after the initial Business Combination which results in the Company’s
shareholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released from
the Lock-up.
Promissory Note — Related Party
On July 29, 2025, the Sponsor agreed to
loan the Company an aggregate of up to $300,000 to be used for a portion of the expenses of the Initial Public Offering. The loan
was non-interest bearing, unsecured and due at the earlier of December 31, 2026 or the closing of the Initial Public Offering.
As of March 30, 2026, the Company had borrowed $300,000, which was fully repaid by the Company at the closing of the Initial Public
Offering. Borrowings under the promissory note are no longer available.
Advances from Related Party
As of March 30, 2026, the Sponsor
had advanced $12,619 for general and administrative expenses, of which $12,614 has been paid by the Company at the closing of the Initial
Public Offering with a remaining balance of $5 which was paid subsequent to the closing of the Initial Public Offering.
Officer Services Agreement
The Chief Executive Office and Chief Financial
Officer entered into officer services agreements for which the officers will provide services to the Company and as consideration will
be paid $5,000 per month and founder shares which will vest quarterly, subject to restrictions and potential forfeitures.
On October 20, 2025, 10,000 founder shares were
transferred to the Chief Executive Officer, which had a fair value of $36,020 using the valuation described above. On November 24, 2025,
5,000 founder shares were transferred to the Chief Financial Officer, which had a fair value of $15,325 or $3.065 per share. The Company
established the fair value of founder shares transferred on November 24, 2025 using Monte Carlo Simulation Model prepared by a third party
valuation firm, which takes into consideration the following market assumptions; (i) implied share price of $9.82, (ii) probability of
De-SPAC and instrument-specific market adjustment of 31.4%, and (iii) risk-free rate of 3.95%.The founder shares transferred are subject
to a performance condition (i.e., providing services through Business Combination). As of March 30, 2026, the Company determined that
the initial Business Combination is not considered probable and therefore no compensation expense has been recognized.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 5 — Related Party Transactions
(cont.)
From July 28, 2025 (inception) through March 30, 2026, the Company has incurred $62,500 for the services of the Chief Financial
Officer and Chief Executive Officer, which are paid by Sponsor through promissory note- related party.
Related Party Loans
In order to 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 $2,000,000 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. As of March 30, 2026, no such Working Capital Loans were outstanding.
Administrative Services Agreement
Commencing on March 26, 2026, the effective date
of the registration statement of the Initial Public Offering, the Company will reimburse the Sponsor in an amount equal to $20,000 per
month for office space, utilities and secretarial and administrative support made available to us. Upon completion of an initial Business
Combination or liquidation, the Company will cease paying these monthly fees. As of March 30, 2026, $3,226 has been accrued for these
services in the Company’s balance sheet.
Note 6 — Commitments and Contingencies
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
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 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
cyberattacks 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.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 6 — Commitments and Contingencies
(cont.)
Registration Rights
The holders of the founder shares, Private Placement
Warrants and the Class A ordinary shares underlying such Private Placement Warrants and Private Placement Warrants and warrants that
may be issued upon conversion of the Working Capital Loans will have registration rights to require the Company to register a sale of
any of the Company’s securities held by them 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 to be signed prior to or 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. In addition, Cantor Fitzgerald & Co. may participate
in a piggyback registration only during the seven-year period beginning on the effective date of the Initial Public Offering. The Company
will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriters’ Agreement
The underwriters have a 45-day option from the
date of the Initial Public Offering to purchase up to an additional 3,000,000 units to cover over-allotments, if any. On March 30, 2026,
the underwriters informed the Company of its forfeiture of the over-allotment option to purchase the additional 3,000,000 Units.
The underwriters were entitled to a cash underwriting
discount of $0.20 per Unit, or $4,000,000 in the aggregate, paid to the underwriters upon the closing of the Initial Public Offering.
Additionally, the underwriters are entitled to a deferred underwriting discount of $0.40 per Unit, or $8,000,000 in the aggregate, payable
to the representative on behalf of the underwriters only upon the consummation of an initial Business Combination.
Note 7 — Shareholders’
Deficit
Preference Shares — The
Company is authorized to issue a total of 5,000,000 preference shares at par value of $0.0001 each. At March 30, 2026, there were no preference
shares issued or outstanding.
Class A Ordinary Shares — The
Company is authorized to issue a total of 500,000,000 Class A ordinary shares at par value of $0.0001 each. At March 30, 2026, there
were no shares of Class A ordinary shares issued or outstanding, excluding 20,000,000 Class A ordinary shares subject to redemption.
Class B Ordinary Shares — The
Company is authorized to issue a total of 50,000,000 Class B ordinary shares at par value of $0.0001 each. On August 12, 2025,
the Company issued 5,750,000 Class B ordinary shares to the Sponsor for $25,000, or approximately $0.004 per share. The founder shares
included an aggregate of up to 750,000 shares subject to forfeiture if the over-allotment option is not exercised by the underwriters
in full. On March 30, 2026, the underwriter forfeited the overallotment option, therefore, the 750,000 Class B ordinary shares were surrendered
by the Sponsor. At March 30, 2026, there are 5,000,000 Class B ordinary shares issued and outstanding.
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 as provided herein. 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 this 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, 20% of the sum of (i) the total number of all ordinary
shares outstanding upon the completion of the Initial Public Offering (including any Class A ordinary shares issued pursuant to the
underwriters’ over-allotment option and excluding the Class A
ordinary shares underlying the private placement warrants issued to the Sponsor), plus (ii) all Class A ordinary shares and
equity-linked securities issued or deemed issued, in connection with the closing of the initial Business Combination (excluding any shares
or equity-linked securities issued, or to be issued, to any seller in the initial Business Combination and any private placement-equivalent
warrants issued to the Sponsor or any of its affiliates or to the Company’s officers or directors upon conversion of working capital
loans) minus (iii) any redemptions of Class A ordinary shares by public shareholders in connection with an initial Business
Combination; provided that such conversion of founder shares will never occur on a less than one-for-one basis.
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 7 — Shareholders’
Deficit (cont.)
Holders of record of the Company’s Class A
ordinary shares and Class B ordinary shares are entitled to one vote for each share held on all matters to be voted on by shareholders.
Unless specified in the amended and restated memorandum and articles of association or as required by the Companies Act or stock exchange
rules, an ordinary resolution under Cayman Islands law and the amended and restated memorandum and articles of association, which requires
the affirmative vote of at least a majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where
proxies are allowed, by proxy at the applicable general meeting of the company is generally required to approve any matter voted on by
the Company’s shareholders. Approval of certain actions require a special resolution under Cayman Islands law, which (except as
specified below) requires the affirmative vote of at least two-thirds of the votes cast by such shareholders as, being entitled to do
so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting, and pursuant to the Company’s amended
and restated memorandum and articles of association, such actions include amending the amended and restated memorandum and articles of
association and approving a statutory merger or consolidation with another company. There is no cumulative voting with respect to the
appointment of directors, meaning, following the Company’s initial Business Combination, the holders of more than 50% of the ordinary
shares voted for the appointment of directors can elect all of the directors. Prior to the consummation of the initial Business Combination,
only holders of the Class B ordinary shares will (i) have the right to vote on the appointment and removal of directors prior
to or in connection with the completion of the initial Business Combination and (ii) be entitled to vote on continuing the Company
in a jurisdiction outside the Cayman Islands (including any special resolution required to amend the constitutional documents or to adopt
new constitutional documents, in each case, as a result of approving a transfer by way of continuation in a jurisdiction outside the Cayman
Islands). Holders of the Class A ordinary shares will not be entitled to vote on these matters during such time. These provisions
of the amended and restated memorandum and articles of association may only be amended if approved by a special resolution passed by the
affirmative vote of at least 90% (or, where such amendment is proposed in respect of the consummation of the initial Business Combination,
two-thirds) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy
at the applicable general meeting of the Company.
Note 8 — Fair Value Measurements
Fair value is defined as the price that would
be received for sale of an asset or paid for transfer of a liability in an orderly transaction between market participants at the measurement
date. U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy
gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and
the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:
| ● | Level 1, defined as observable inputs such as quoted prices
(unadjusted) for identical instruments in active markets; |
| ● | Level 2, defined as inputs other than quoted prices in active
markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices
for identical or similar instruments in markets that are not active; and |
| ● | Level 3, defined as unobservable inputs in which little or
no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques
in which one or more significant inputs or significant value drivers are unobservable. In some circumstances, the inputs used to measure
fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is
categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. |
The fair value of the Public Warrants is $2,470,000,
or $0.247 per Public Warrant. The fair value of Public Warrants was determined using Monte Carlo Simulation Model. The Public Warrants
have been classified within shareholders’ deficit and will not require remeasurement after issuance. The following table presents
the quantitative information regarding market assumptions used in the Level 3 valuation of the Public Warrants:
| | |
March 30,
2026 | |
| Underlying stock price | |
$ | 9.79 | |
| Exercise price | |
$ | 11.50 | |
| Volatility | |
| 5.00 | % |
| Risk-free rate | |
| 4.03 | % |
| Warrant term (years) | |
| 6.50 | |
QDRO Acquisition Corp.
NOTES TO FINANCIAL STATEMENT
MARCH 30, 2026
Note 9 — Segment Information
FASB 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 that engage in business activities from which
it may recognize revenues and incur expenses, and for which separate financial information is available that is regularly evaluated by
the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance.
The Company’s CODM has been identified as
the Chief Financial Officer, who reviews the assets, operating results, and financial metrics for the Company as a whole to make decisions
about allocating resources and assessing financial performance. Accordingly, management has determined that the Company only has one reportable
segment.
The measure of segment assets is reported on the
balance sheet as total assets. When evaluating the Company’s performance and making key decisions regarding resource allocation,
CODM reviews several key metrics, which include the following:
| | |
March 30,
2026 | |
| Cash | |
$ | 1,248,410 | |
| Cash held in Trust Account | |
$ | 200,000,000 | |
The CODM reviews the position of total assets
to assess if the Company has sufficient resources available to discharge its liabilities. The CODM is provided with details of cash and
liquid resources available with the Company. The CODM will review the interest that will be earned and accrued on cash 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.
Note 10 — Subsequent Events
The Company evaluated subsequent events and transactions
that occurred after the balance sheet date through April 6, 2026, the date that the financial statement was available to be issued.
Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial
statement.
