FACT II Acquisition Corp. 10-Q Summary
Business Context and Reporting Period
FACT II Acquisition Corp. is a Cayman Islands exempted company incorporated on June 19, 2024, operating as a blank check company (SPAC) seeking an initial business combination. The reporting period covers the three and six months ended June 30, 2025. The Company consummated its Initial Public Offering (IPO) on November 27, 2024, and has not yet commenced operations other than searching for a target business.
Key Financial Metrics
| Metric | Six Months Ended June 30, 2025 | Three Months Ended June 30, 2025 |
|---|---|---|
| Net Income | $3,079,421 | $1,631,524 |
| General & Administrative Expenses | $563,903 | $199,558 |
| Interest Income (Trust Account) | $3,604,845 | $1,819,161 |
| Cash (Operating) | $1,088,465 (as of June 30, 2025) | N/A |
| Cash Held in Trust Account | $180,202,115 (as of June 30, 2025) | N/A |
| Working Capital | $1,136,435 | N/A |
| Deferred Underwriting Fee | $7,000,000 | N/A |
| EPS (Class A & B) | $0.13 | $0.07 |
Material Changes vs. Prior Period
- Revenue and Income: The Company generated no operating revenue. Net income for the six months ended June 30, 2025, was driven entirely by interest earned on the Trust Account ($3.6M) and a gain from the change in fair value of the over-allotment liability ($26,558), offset by operating expenses.
- Trust Account Growth: Cash held in the Trust Account increased from $176,597,270 at December 31, 2024, to $180,202,115 at June 30, 2025, primarily due to accrued interest.
- Share Capital: On January 10, 2025, the underwriters' over-allotment option expired unexercised. Consequently, 875,000 founder shares (Class B) were forfeited, reducing the outstanding Class B shares from 6,708,333 to 5,833,333.
- Liabilities: The over-allotment option liability of $26,558 recorded at year-end 2024 was extinguished in Q1 2025 upon the option's expiration.
Outlook, Risks, and Management Commentary
- Business Combination Deadline: The Company has until 18 months from the IPO closing (May 27, 2026) to complete a business combination, extendable to 24 months if a definitive agreement is signed within the first 18 months.
- Liquidity and Going Concern: While the Company has sufficient working capital for the next 12 months, the mandatory liquidation date raises substantial doubt about its ability to continue as a going concern if a business combination is not completed.
- Redemption Rights: Public shareholders may redeem their shares for a pro rata portion of the Trust Account (approximately $10.30 per share as of June 30, 2025) upon the completion of a business combination or liquidation.
- Risk Factors: Management highlights risks related to geopolitical instability (Russia-Ukraine, Israel-Hamas conflicts), global market volatility, and the possibility of failing to identify a suitable target business.
- Warrants: There are 9,081,563 warrants outstanding (8,750,000 Public and 331,563 Private Placement) exercisable at $11.50 per share. Public warrants become exercisable 30 days after a business combination or 12 months post-IPO, whichever is later.
Investor Verification Checklist
- Trust Account Balance: Verify the current per-share redemption value ($10.30) and the total Trust Account balance ($180.2M) to assess liquidation value.
- Extension Period: Confirm the exact deadline for completing a business combination (May 27, 2026, or potentially 24 months post-IPO) and any shareholder vote requirements for extensions.
- Deferred Fees: Note the $7,000,000 deferred underwriting fee payable only upon successful completion of a business combination.
- Founder Share Forfeiture: Confirm the reduction in Class B shares to 5,833,333 following the expiration of the over-allotment option.
- Going Concern Status: Review the "Liquidity and Capital Resources" section for updates on the Company's ability to fund operations until the liquidation date.