RIBB

Business Context and Reporting Period

Ribbon Acquisition Corporation (RIBB) is a Cayman Islands exempted company incorporated on July 17, 2024, operating as a Special Purpose Acquisition Company (SPAC). The company was formed to effect a merger, share exchange, or asset acquisition with one or more target businesses. The reporting period covers the fiscal year ended December 31, 2025.

On June 30, 2025, the Company entered into a definitive Business Combination Agreement with DRC Medicine Inc., a company focused on AI-powered allergy and infection diagnostic kits. The Company is currently focused on completing this transaction. On January 9, 2026, shareholders approved an extension of the deadline to consummate a business combination to January 16, 2027.

Key Financial Metrics

Material Changes vs. Prior Period

• Capitalization: The Company consummated its Initial Public Offering (IPO) on January 16, 2025, selling 5,000,000 units at $10.00 per unit for gross proceeds of $50,000,000. Simultaneously, it completed a private placement of 220,000 units to the Sponsor for $2,200,000.
• Trust Account: $50,000,000 was deposited into a U.S.-based trust account. By year-end, the balance grew to $51,948,314 due to interest income.
• Profitability: The Company reported a net income of $690,218 for 2025, driven primarily by interest income on trust assets, compared to a net loss of $10,305 for the period from inception through December 31, 2024.
• Redemptions: Subsequent to the balance sheet date (January 9, 2026), approximately 1,436,867 shares were redeemed, resulting in a withdrawal of approximately $14.9 million from the trust account.

Outlook, Risks, and Management Commentary

• Business Combination: The Company is actively pursuing the merger with DRC Medicine. The transaction involves a share exchange and the domestication of the Company from the Cayman Islands to Delaware.
• Going Concern: Management has identified substantial doubt about the Company's ability to continue as a going concern if a business combination is not completed by the extended deadline of January 16, 2027. The financial statements do not include adjustments that might result from this uncertainty.
• Liquidity: The Company has a working capital deficit and relies on funds held outside the trust account and potential loans from the Sponsor to meet operating expenses. As of December 31, 2025, cash outside the trust was only $11,497.
• Internal Controls: Management concluded that internal controls over financial reporting were not effective as of December 31, 2025, citing inadequate segregation of duties and insufficient written policies.
• Regulatory Risks: The filing highlights risks related to potential regulatory approvals required from Chinese authorities (CSRC) given the target's operations and the management team's ties to the region, though the Company currently believes no prior permission is required.

Investor Verification Checklist

• Redemption Impact: Verify the final number of shares redeemed and the remaining cash in the trust account following the January 2026 redemption event, as this directly impacts the net tangible assets available for the merger.
• Merger Conditions: Confirm the status of closing conditions for the DRC Medicine transaction, including shareholder approvals and regulatory filings (Form S-4).
• Liquidity Sufficiency: Assess whether the Sponsor's working capital loans or additional financing will be sufficient to cover operating expenses and transaction costs until the merger closes, given the current cash balance of $11,497.
• Internal Control Remediation: Review any updates regarding the material weakness in internal controls over financial reporting identified in the 10-K.
• Extension Terms: Verify the specific terms of the extension approved in January 2026 and any associated costs or interest implications for shareholders.