Business Context and Reporting Period
Company: Iron Horse Acquisition II Corp. (a Cayman Islands exempted company and Special Purpose Acquisition Company).
Reporting Period: Quarter ended February 28, 2026.
Status: The Company is a "blank check" company formed to effect a merger or business combination. It has not yet commenced operations. The Company consummated its Initial Public Offering (IPO) on December 18, 2025, and is currently in the process of identifying a target business, primarily within the media and entertainment industry.
Key Financial Metrics
| Metric | Value (Q1 2026) |
|---|---|
| Net Income | $1,358,897 |
| Operating Costs | $277,959 |
| Interest Income (Trust Account) | $1,636,856 |
| Cash (Outside Trust) | $718,100 |
| Trust Account Balance | $231,461,856 |
| Total Assets | $232,424,677 |
| Total Liabilities | $11,129,546 |
| Shareholders' Deficit | $(10,166,725) |
| Deferred Underwriting Fee | $10,950,000 |
Material Changes vs. Prior Period
- Revenue and Profit: The Company reported a net income of $1,358,897 for the three months ended February 28, 2026, compared to a net loss of $72,670 for the same period in 2025. This shift is driven entirely by interest income earned on the Trust Account ($1,636,856), as the Company has no operating revenue.
- Balance Sheet: Total assets increased from $364,681 (Nov 30, 2025) to $232,424,677 (Feb 28, 2026) following the IPO. The Trust Account balance grew from $0 to $231,461,856.
- Equity Structure: Following the IPO and full exercise of the over-allotment option, 23,000,000 Public Shares are now subject to possible redemption, valued at $231,461,856. This resulted in a significant accretion to the redemption value, contributing to the reported Shareholders' Deficit.
- Cash Flow: Net cash provided by financing activities was $231,015,794, primarily from the sale of Units ($226,000,000) and Private Placement Units ($5,700,000). Net cash used in investing activities was $229,825,000, reflecting the deposit of funds into the Trust Account.
Outlook, Risks, and Management Commentary
- Business Combination Timeline: The Company has 24 months from the closing of the IPO (December 18, 2025) to consummate a business combination. If unsuccessful, it will liquidate and redeem public shares.
- Liquidity: Management believes the $718,100 in cash outside the Trust Account is sufficient to meet working capital needs for the next 12 months. However, additional financing may be required if due diligence costs exceed estimates or if a significant number of shares are redeemed upon a business combination.
- Deferred Fees: A deferred underwriting fee of $10,950,000 is payable only upon the successful completion of a business combination.
- Risks: The filing highlights geopolitical risks (Russia-Ukraine, Israel-Hamas conflicts) that could disrupt capital markets and the search for a target. There is no assurance a business combination will be completed.
- Controls: Management concluded that disclosure controls and procedures were not effective as of February 28, 2026, though no material changes to internal controls were reported during the quarter.
Investor Verification Checklist
- Trust Account Yield: Verify the interest rate earned on the $231.5M Trust Account to assess the sustainability of the current net income.
- Redemption Risk: Monitor the number of shares subject to redemption ($10.06 per share) and the potential impact on the Company's ability to close a deal if a large portion is redeemed.
- Deferred Underwriting Fee: Confirm the $10.95M liability is contingent solely on a successful business combination.
- Going Concern: Review the $718k cash balance outside the Trust Account against projected operating expenses to ensure sufficiency for the 24-month search period.
- Internal Controls: Investigate the specific reasons for the ineffectiveness of disclosure controls and procedures noted in Item 4.