Company: FGMCU
Filing Date: 2025-09-18
Form Type: S-4
Source: 0001104659-25-091249
Chunk: 387

Company: FG Merger II Corp.
Filing Date: 2025-09-18
Form: S-4
Chunk 387
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 Company also determined to write down 68 Boxes that had been held in inventory for an extended time period and for which the Company determined that it was not cost effective to rework, resulting in an inventory write-down of $8.4 million.

As of June 30, 2025, BOXABL had 126 Casitas classified as finished goods in inventory and 222 Casitas classified as work-in-process in inventory.

Regulation

Our Boxes generally fall under different certification requirements depending on their intended use. BOXABL’s Casita can be configured for sale in various ways, including Park Model RV and/or Modular Home. BOXABL has obtained Modular Manufacturer Licensure and Certification for its studio Casita configuration in several States, including Nevada, California, New Mexico, and South Carolina. We had originally obtained approval for our Casita in Arizona in December 2023. However, the Arizona Department of Housing revoked this approval in May 2024 due to installation issues identified at one customer site in Arizona. We have assessed that these issues resulted from improper installation rather than our product and are in active discussions with officials in Arizona to resolve the matter.

The modular home units are classified as residential construction, referred to as “Modular” or “Factory-Built” units, depending on the definitions established in the Authority Having Jurisdiction (AHJ). In 2025, BOXABL Casitas were approved as a Modular home under the Residential Building Code by the Manufactured Housing Division.

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Most states require the approval of a third-party testing and inspection company, for modular homes, to conduct product testing and factory inspections on behalf of the AHJ. There are several independent third-party inspection Agencies who provide such service, including ICC-NTA, Twining Consulting (dba RADCO), PFS-TECO, NOAH, & MA Consulting & Engineering (MACE, LLC), to test and inspect our Casitas for compliance in the applicable jurisdictions.

Some states (including Oklahoma, Utah, Wyoming, Kansas, West Virginia, Vermont, Alaska, Oregon, Connecticut, Delaware and New York) do not have state modular housing programs. In those states, our products may be deployed by obtaining a permit from the local building departments. This process has been validated for BOXABL Casitas used in several projects located in Utah and Oklahoma.

BOXABL is also able to sell its Casitas in all states, by adding a permanent trailer/chassis, as a Park Model RV (PMRV) based on self-certification to the