Business Context and Reporting Period
X3 Acquisition Corp. Ltd. is a Cayman Islands exempted company incorporated on July 31, 2025, operating as a blank check company (SPAC) formed to effect a business combination. The filing covers the quarter ended March 31, 2026. The Company consummated its Initial Public Offering (IPO) on January 22, 2026, and partially exercised the underwriters' over-allotment option on January 26, 2026. As of the reporting date, the Company has not commenced operations and has not selected a specific business combination target.
Key Financial Metrics
| Metric | Value (Q1 2026) |
|---|---|
| Net Income | $913,196 |
| Trust Account Balance | $226,486,330 |
| Cash (Outside Trust) | $921,248 |
| Working Capital | $1,162,945 |
| Total Liabilities | $5,846,441 |
| Deferred Underwriting Fee | $5,625,000 |
| Shares Outstanding (Class A) | 22,500,000 (Subject to Redemption) |
| Shares Outstanding (Class B) | 5,625,000 |
Note: The Company reported no operating revenue. Net income was driven primarily by interest earned on marketable securities held in the Trust Account ($1,486,330).
Material Changes vs. Prior Period
- Assets: Total assets increased from $247,558 (Dec 31, 2025) to $227,870,716 (Mar 31, 2026), driven by the placement of $225,000,000 into the Trust Account following the IPO.
- Liabilities: Total liabilities increased from $291,763 to $5,846,441, primarily due to the recognition of a $5,625,000 deferred underwriting fee payable.
- Equity: Shareholders' deficit increased from $(44,205) to $(4,462,055) due to the accretion of Class A ordinary shares to their redemption value ($14,197,193 charge), partially offset by proceeds from private placement warrants and net income.
- Cash Flow: The Company generated $226,057,928 in net cash from financing activities (IPO and private placement proceeds) and used $225,000,000 in investing activities (Trust Account funding).
Outlook, Risks, and Management Commentary
- Going Concern: Management has raised substantial doubt about the Company's ability to continue as a going concern for one year following the issuance date. The Company may need to raise additional capital through loans or investments from the Sponsor or third parties to meet working capital needs.
- Completion Window: The Company intends to complete an initial business combination within 24 months from the closing of the IPO (by approximately January 2028). If unsuccessful, the Company will liquidate and redeem public shares.
- Redemption Rights: Public shareholders may redeem their shares for a pro-rata portion of the Trust Account (approx. $10.07 per share as of March 31, 2026) upon the completion of a business combination or liquidation.
- Risks: Risks include the inability to complete a business combination, potential dilution from warrant exercises, and the Sponsor's limited ability to satisfy indemnification obligations regarding third-party claims against the Trust Account.
- Unusual Items: The Company recognized $393,600 in share-based compensation expense related to founder shares granted to independent directors. Additionally, 125,000 founder shares were forfeited due to the expiration of the remaining underwriters' over-allotment option.
Investor Verification Checklist
- Verify the Trust Account balance of $226,486,330 and the per-share redemption value of $10.07.
- Confirm the status of the deferred underwriting fee ($5,625,000) and the condition under which it may be waived (if Trust Account falls below $70 million).
- Assess the liquidity risk and the Company's plan to secure additional working capital loans if needed to sustain operations until a business combination.
- Review the share forfeiture details: 125,000 Class B shares were forfeited, leaving 5,625,000 outstanding.
- Monitor the 24-month deadline for completing a business combination to avoid mandatory liquidation.