Business Context and Reporting Period
Company: Armada Acquisition Corp. II (XRPN)
Filing Type: Form 10-Q (Quarterly Report)
Reporting Period: Quarter ended March 31, 2026
Business Overview: The Company is a Cayman Islands exempted special purpose acquisition company (SPAC) formed to effect a merger with one or more businesses, focusing on FinTech, SaaS, or AI sectors. As of the reporting date, the Company has not commenced operations and has no operating revenue. It is currently in the process of consummating a proposed business combination with Ripple Labs Inc. and Pathfinder Digital Assets LLC.
Key Financial Metrics
| Metric | Three Months Ended March 31, 2026 |
Six Months Ended March 31, 2026 |
As of March 31, 2026 |
|---|---|---|---|
| Revenue | $0 | $0 | N/A |
| Net Income (Loss) | $1,131,313 | $527,553 | N/A |
| Operating Expenses | $973,748 | $3,879,397 | N/A |
| Interest Income (Trust Account) | $2,105,061 | $4,406,950 | N/A |
| Cash (Operating) | N/A | N/A | $88,640 |
| Trust Account Balance | N/A | N/A | $239,035,116 |
| Total Liabilities | N/A | N/A | $14,295,577 |
| Working Capital Deficit | N/A | N/A | ($4,785,579) |
Material Changes vs. Prior Period
- Profitability Shift: The Company reported a net income of $1,131,313 for the three months ended March 31, 2026, compared to a net loss of $706 for the same period in 2025. This improvement is driven entirely by interest income earned on the Trust Account ($2.1M), which offset general and administrative costs.
- Expense Growth: General and administrative costs increased significantly to $973,748 for the quarter (vs. $706 in the prior year), primarily due to regulatory filing fees, insurance, and legal fees associated with reviewing the business combination agreement.
- Trust Account Growth: The Trust Account balance increased from $234,628,166 at September 30, 2025, to $239,035,116 at March 31, 2026, reflecting accrued interest income.
- Liquidity Position: Operating cash decreased from $361,105 to $88,640, resulting in a working capital deficit of approximately $4.8 million.
Outlook, Risks, and Material Events
Proposed Business Combination
On October 19, 2025, the Company entered into a Business Combination Agreement to merge with Ripple Labs Inc. and Pathfinder Digital Assets LLC. The transaction involves a complex capital structure including:
- PIPE Financing: Agreements for approximately $224.55 million in cash and significant contributions of XRP tokens from institutional investors, the New Sponsor, and Ripple affiliates.
- Lock-Up Agreements: Key stakeholders, including the New Sponsor and Ripple affiliates, have agreed to lock-up periods of six months post-closing.
- Shareholder Approval: The transaction is subject to shareholder approval and other customary closing conditions.
Liquidity and Going Concern
Management has identified substantial doubt regarding the Company's ability to continue as a going concern. The Company has until November 22, 2026, to consummate a business combination. If no transaction is completed by this date, the Company must liquidate and distribute Trust Account funds to shareholders. The Company currently holds only $88,640 in operating cash and relies on potential loans from the Sponsor or affiliates to fund working capital deficiencies.
Risks and Contingencies
- Transaction Failure: There is no assurance the business combination will close. Failure to close by the deadline triggers mandatory liquidation.
- Deferred Underwriting Fees: The Company owes $9,200,000 in deferred underwriting fees, payable only upon the successful completion of a business combination.
- Related Party Transactions: Significant control and equity interests were transferred to a "New Sponsor" (Arrington XRP Capital Fund, LP) in August 2025.
Investor Verification Checklist
- Transaction Status: Verify the current status of the Business Combination Agreement with Ripple Labs and whether all closing conditions (including regulatory approvals) have been met.
- Redemption Risk: Assess the likelihood of public shareholders redeeming their shares prior to the vote, which could impact the cash available for the transaction.
- Working Capital: Confirm if the Sponsor or affiliates have provided additional working capital loans to cover the $4.8 million deficit and ongoing operational costs.
- PIPE Commitments: Review the binding nature of the $224.55 million PIPE commitments and the valuation assumptions used for the XRP token contributions.
- Liquidation Deadline: Monitor the timeline relative to the November 22, 2026, liquidation date to ensure the transaction can close in time.