Company: MKLY
Filing Date: 2025-09-23
Form Type: 10-Q
Source: 0001213900-25-090712
Chunk: 30

Company: McKinley Acquisition Corp
Filing Date: 2025-09-23
Form: 10-Q
Item: Part I, Item 1
Chunk 30
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 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. In the event that the offering expenses
are less than our estimate of $750,000, the amount of funds available outside the Trust Account would increase by a corresponding amount.

16

On August 15, 2025, Clear Street formally notified
the Company that they will exercise their over-allotment option to the full extent of 2,250,000 Units, generating $22,500,000 of additional
proceeds. The Units were delivered to Clear Street in connection with the closing on August 19, 2025. The $22,500,000 of proceeds from
the underwriters exercise of their over-allotment option were placed into the Trust Account.

We intend to use substantially all of the funds
held in the Trust Account, including any amounts representing interest earned on the Trust Account (excluding contingent, deferred underwriting
commissions). We may withdraw interest for permitted withdrawals, including the payment of income or franchise (but not excise) taxes.
Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the Trust Account.
We expect the interest earned on the amount in the Trust Account will be sufficient to pay our taxes. To the extent that our equity or
debt is used, in whole or in part, as consideration to complete our initial business combination, the remaining proceeds held in the Trust
Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue
our growth strategies.

Upon the completion of an initial business combination,
three percent (3.0%) of amounts remaining in the Trust Account, after redemption payments and other permitted withdrawals, and excluding
amounts related to any non-redemption agreements, forward purchase agreements or similar agreements, shall be paid to the underwriters
as contingent, deferred underwriting commissions.

Prior to the completion of our initial business
combination, we will have available to us funds that are held outside the Trust Account. We will use these funds to primarily identify
and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants
or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements
of prospective target businesses, and structure, negotiate and complete a business combination.

We do not believe we will need to raise additional