Business Context and Reporting Period
Company: Archimedes Tech SPAC Partners II Co. (ATII)
Filing Type: Form 10-Q (Unaudited)
Period Ended: March 31, 2026
Status: Cayman Islands blank check company (SPAC) formed to effect a business combination in the technology sector (AI, cloud, automotive). The Company has not commenced operations and generates no operating revenue. Funds are held in a Trust Account pending a merger.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Net Income | $1,704,803 | $1,159,223 |
| Trust Account Balance | $242,002,931 | $239,860,969 |
| Cash (Outside Trust) | $1,077,839 | $1,863,173 |
| General & Administrative Expenses | $448,673 | $157,451 |
| Interest Income (Trust) | $2,141,962 | $1,305,884 |
| Total Liabilities | $8,359,370 | $8,187,516 |
| Deferred Underwriting Fee | $8,050,000 | $8,050,000 |
Note: The Company reported a loss from operations of $(448,673) for Q1 2026, offset by significant interest income.
Material Changes vs. Prior Period
- Net Income Increase: Net income rose 47% to $1.70 million, driven primarily by a $836,000 increase in interest earned on the Trust Account due to higher interest rates or compounding.
- Expense Growth: General and administrative expenses increased 185% to $448,673, reflecting ongoing operational costs and administrative fees ($30,000 paid to Sponsor in Q1 2026 vs. $16,786 accrued in Q1 2025).
- Liquidity: Cash held outside the Trust Account decreased by approximately $285,000, resulting in a net cash outflow from operating activities of $208,688.
- Redemption Value: The redemption value per public share increased from $10.43 to $10.52 due to interest accretion.
Outlook, Management Commentary, and Risks
Merger Agreement (Subsequent Event)
On April 20, 2026, the Company entered into a Merger Agreement with Forge Nano, Inc. Key terms include:
- Transaction Structure: ATII will re-domicile to Delaware and merge with Forge Nano. The combined entity will be named "Forge Nano Holdings Inc."
- Valuation: Forge Nano stockholders will receive shares based on a $1.2 billion equity value (Closing Payment Shares).
- Earn-out: Up to 90,000,000 additional shares issuable upon achievement of milestones over five years.
- Pipe Financing: A subscription agreement was signed for $100 million in new equity and warrants.
- Regulatory: Form S-4 filed with the SEC on May 5, 2026.
Liquidity and Going Concern
The Company has sufficient working capital ($1.08 million) to operate for the next 12 months. However, if a business combination is not completed by November 12, 2026 (21 months from IPO), the Company must liquidate. This mandatory liquidation date raises substantial doubt about the Company's ability to continue as a going concern absent a merger.
Risks
- Completion Risk: Failure to close the Forge Nano merger or any other transaction by the deadline will result in liquidation.
- Redemption Risk: Significant shareholder redemptions could reduce cash available for the transaction.
- Market Conditions: Geopolitical instability and economic downturns could impact the ability to consummate the merger.
Investor Verification Checklist
- Merger Status: Verify the current status of the Form S-4 and shareholder vote approval for the Forge Nano transaction.
- Redemption Levels: Monitor the percentage of public shares tendered for redemption, which could impact the $100 million PIPE financing and closing conditions.
- Trust Account Interest: Confirm the yield on the Trust Account remains sufficient to support the $10.52+ per share redemption value.
- Deferred Fees: Note the $8.05 million deferred underwriting fee payable only upon successful closing.
- Lock-up Periods: Review the 6-month lock-up for Forge Nano stockholders and Sponsor commitments.