Business Context and Reporting Period
Company: RF Acquisition Corp II (RFAI), a Cayman Islands exempted company and Special Purpose Acquisition Company (SPAC).
Reporting Period: Quarter ended March 31, 2026.
Business Status: The Company is in the pre-business combination phase, formed to effect a merger with a target in the deep technology sector (AI, quantum computing, biotechnology) in Asia. It has not commenced operations and generates no operating revenue.
Target Transaction: On October 2, 2025, the Company entered into a Business Combination Agreement with Nanyang Biologics Pte. Ltd. ("Nanyang").
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Net Income | $93,702 | $1,020,970 |
| Operating Costs | $360,594 | $213,238 |
| Interest Income (Trust Account) | $454,296 | $1,234,208 |
| Cash (Outside Trust) | $34,737 | $812,338 |
| Cash (Trust Account) | $52,891,674 | $52,257,378 |
| Total Assets | $53,131,825 | $52,659,178 |
| Total Liabilities | $5,193,394 | $4,994,449 |
| Working Capital Deficit | ($928,243) | N/A |
| Deferred Underwriting Fee | $4,025,000 | $4,025,000 |
Material Changes vs. Prior Period
- Net Income Decline: Net income decreased significantly from $1.02 million in Q1 2025 to $93,702 in Q1 2026. This is primarily due to a sharp drop in interest income earned on the Trust Account ($454k vs $1.23M), reflecting lower interest rates or reduced principal balance following redemptions.
- Operating Cost Increase: General, administrative, and operational costs rose by approximately 69% to $360,594, driven by transaction costs and extension fees related to the pending business combination.
- Cash Position: Cash held outside the Trust Account dropped from $812,338 to $34,737, indicating heavy utilization of working capital for operational and transaction expenses.
- Redemption Activity: In November 2025, approximately 6.67 million shares were redeemed, reducing the Trust Account balance by roughly $71.6 million. As of March 31, 2026, 4,831,265 public shares remain subject to redemption.
Outlook, Risks, and Contingencies
- Going Concern: Management has determined that conditions raise substantial doubt about the Company's ability to continue as a going concern for one year from the issuance date. This is due to the working capital deficit and the uncertainty of completing the Business Combination.
- Extension Timeline: The deadline to consummate a Business Combination was extended to August 15, 2026. Subsequent to the quarter end (April 2026), the target (Nanyang) deposited funds to extend the deadline further to May 15, 2026.
- Liquidity Risks: The Company relies on the Trust Account for the transaction and has minimal cash outside the Trust ($34,737). It may need to obtain additional financing or rely on loans from the Sponsor to complete the transaction or fund operations.
- Transaction Contingencies: The Business Combination with Nanyang is subject to customary closing conditions. If the transaction fails, the Company will liquidate and distribute Trust Account funds to shareholders.
- Internal Controls: Management concluded that disclosure controls and procedures were not effective as of March 31, 2026, citing a need to improve review processes for complex securities and accounting standards.
Investor Verification Checklist
- Extension Funding: Verify the status of extension payments made by the target (Nanyang) and the current deadline for the Business Combination.
- Working Capital: Assess the sufficiency of the remaining $34,737 cash balance to fund operations until the transaction closes or liquidation occurs.
- Redemption Risk: Monitor the number of shares subject to redemption (4.83 million) and the potential impact of further redemptions on the Trust Account balance per share.
- Transaction Progress: Confirm the status of regulatory approvals and closing conditions for the merger with Nanyang Biologics.
- Internal Control Remediation: Review subsequent filings for updates on the remediation of ineffective disclosure controls.