Ribbon Acquisition (NASDAQ: RIBB) details Q1 2026 results and DRC Medicine merger plan
Ribbon Acquisition Corporation reported Q1 2026 net income of $252,755, driven by $330,541 of interest on trust investments against operating expenses of $77,786. As of March 31, 2026, the trust held $37,716,530 and cash outside the trust was $1,878.
The SPAC has $35,062,690 of Class A shares classified as redeemable and a working capital deficit of $1,008,960, and management highlights substantial doubt about its ability to continue as a going concern if a business combination is not completed by January 16, 2027. The company continues to pursue its previously signed Business Combination Agreement with DRC Medicine and funded extension payments via a $600,000 related-party promissory note.
Positive
- None.
Negative
- Going concern uncertainty: Management states that mandatory liquidation if no business combination is completed by January 16, 2027, combined with ongoing costs, raises substantial doubt about Ribbon’s ability to continue as a going concern.
- Capital and redemption pressure: The company reports a working capital deficit of $1,008,960 and prior redemptions of 1,436,867 public shares for $14,937,326, reducing the trust balance and future deal capital.
Insights
Ribbon’s quarter is steady financially but constrained by redemptions and a ticking SPAC deadline.
Ribbon Acquisition earned modest net income of $252,755, almost entirely from interest on the $37,716,530 held in its Trust Account as of March 31, 2026. Operating expenses remain low at $77,786, consistent with a pre-deal SPAC.
However, redemptions of 1,436,867 public shares for $14,937,326 and a working capital deficit of $1,008,960 underscore balance-sheet pressure. The company extended its deadline to complete a deal to January 16, 2027 and issued a $600,000 promissory note to a sponsor affiliate to fund monthly trust contributions.
Management explicitly notes substantial doubt about the ability to continue as a going concern if no business combination is completed within the allowed period. Investors following the proposed Business Combination with DRC Medicine will likely focus on progress toward closing and any updates on redemption levels at that transaction.
Key Figures
Key Terms
Trust Account financial
Business Combination Agreement financial
emerging growth company regulatory
going concern financial
redeemable ordinary shares financial
deferred underwriting commissions financial
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(MARK ONE)
For the quarter ended
For the transition period from to
Commission file number:
(Exact Name of Registrant as Specified in Its Charter)
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of incorporation or organization) |
(I.R.S. Employer Identification No.) |
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Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The | ||||
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As of March 31, 2026, there were
Ribbon Acquisition Corporation
FORM 10-Q FOR QUARTER ENDED MARCH 31, 2026
TABLE OF CONTENTS
| Page | ||||
| PART I – FINANCIAL INFORMATION | ||||
| Item 1. | Financial Statements | 1 | ||
| Condensed Balance Sheet as of March 31, 2026 (Unaudited) and December 31, 2025 | 1 | |||
| Unaudited Condensed Statement of Operations for the Three Months Ended March 31, 2026 (Unaudited) | 2 | |||
| Unaudited Condensed Statement of Changes in Shareholders’ Equity for the Three Months Ended March 31, 2026 (Unaudited) | 3 | |||
| Unaudited Condensed Statement of Cash Flows for the Three Months Ended March 31, 2026 | 4 | |||
| Notes to Unaudited Condensed Financial Statements | 5 | |||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 21 | ||
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 26 | ||
| Item 4. | Controls and Procedures | 26 | ||
| PART II – OTHER INFORMATION | 27 | |||
| Item 1. | Legal Proceedings | 27 | ||
| Item 1A. | Risk Factors | 27 | ||
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 27 | ||
| Item 3. | Defaults Upon Senior Securities | 27 | ||
| Item 4. | Mine Safety Disclosures | 27 | ||
| Item 5. | Other Information | 27 | ||
| Item 6. | Exhibits | 28 | ||
| SIGNATURES | 29 | |||
i
PART I – FINANCIAL INFORMATION
Item 1. Interim Financial Statements
RIBBON
ACQUISITION CORP.
BALANCE SHEET
| March 31, 2026 | December 31, 2025 | |||||||
| (Unaudited) | (Audited) | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expense | ||||||||
| Total Current Assets | ||||||||
| Cash and marketable securities held in the trust | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities | ||||||||
| Current liabilities | ||||||||
| Accrued expenses | $ | $ | ||||||
| Other payable | ||||||||
| Promissory note - related party | - | |||||||
| Total current liabilities | ||||||||
| Deferred Underwriting Commission | ||||||||
| Total liabilities | ||||||||
| Class A ordinary shares, $ | ||||||||
| Commitment and contingencies (Note 6) | ||||||||
| Shareholder’s Deficit | ||||||||
| Class A ordinary shares, $ | ||||||||
| Class B ordinary shares, $ | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total shareholder’s deficit | ( | ) | ( | ) | ||||
| Total liabilities and shareholder’s deficit | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited financial statements.
1
RIBBON
ACQUISITION CORP.
UNAUDITED STATEMENT OF OPERATIONS
| For the Three
Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Administrative fee | $ | $ | ||||||
| Total operating expenses | ||||||||
| Loss from Operations | ( | ) | ( | ) | ||||
| Income earned on marketable securities held in Trust Account | ||||||||
| Net income | ||||||||
| Basic and diluted weighted average ordinary shares outstanding, redeemable ordinary shares | ||||||||
| Basic and diluted net income per ordinary share, redeemable ordinary shares | ||||||||
| Basic and diluted weighted average ordinary shares outstanding, non-redeemable ordinary shares | ||||||||
| Basic and diluted net loss per ordinary share, non-redeemable ordinary shares | $ | ( | ) | $ | ( | ) | ||
The accompanying notes are an integral part of the unaudited financial statements.
2
RIBBON
ACQUISITION CORP.
UNAUDITED STATEMENT OF CHANGES IN SHAREHOLDER’S EQUITY (DEFICIT)
| Class A Ordinary Shares | Class B Ordinary Shares | Additional | Accumulated | Total Shareholder’s | ||||||||||||||||||||||||
| Shares | Amount | Shares (1) | Amount | Paid-In Capital | (Deficit) Equity | Equity (Deficit) | ||||||||||||||||||||||
| Balance as of December 31, 2024 | - | $ | - | $ | $ | $ | ( | ) | $ | |||||||||||||||||||
| Sale of private placement units | - | - | - | |||||||||||||||||||||||||
| Issuance of public rights, net of issuance costs | - | - | - | - | - | |||||||||||||||||||||||
| Net income | - | - | - | - | - | |||||||||||||||||||||||
| Accretion of ordinary shares subject to redemption value | - | - | - | - | ( | ) | - | ( | ) | |||||||||||||||||||
| Balance as of March 31, 2025 | ||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | - | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
| Net income | - | - | - | - | - | |||||||||||||||||||||||
| Accretion of ordinary shares subject to redemption value | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance as of March 31, 2026 | $ | $ | $ | - | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
The accompanying notes are an integral part of the unaudited financial statements.
3
RIBBON
ACQUISITION CORP.
UNAUDITED STATEMENT OF CASH FLOWS
| For the Three Months Ended March 31, | ||||||||
| 2026 | 2025 | |||||||
| Net cash used in operating activities | ||||||||
| Net income | $ | $ | ||||||
| Adjustments to reconcile net income to net cash used in operating activities | ||||||||
| Income earned on marketable securities held in Trust Account | ( | ) | ( | ) | ||||
| Changes in operating assets and liabilities | ||||||||
| Accrued expenses | ||||||||
| Prepaid expense | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash Flows from Investing Activity | ||||||||
| Purchase of marketable securities held in Trust Account | - | ( | ) | |||||
| Cash deposited into Trust Account | ( | ) | - | |||||
| Cash withdrawn from Trust Account to public stockholder redemption | ( | ) | - | |||||
| Net cash used in investing activity | ( | ) | ( | ) | ||||
| Cash Flows from Financing Activities | ||||||||
| Repayment of promissory note to related party | - | ( | ) | |||||
| Proceeds from promissory note to related party | - | |||||||
| Proceeds from sale of public units through public offerings, net of underwriters’ discount | - | |||||||
| Proceeds from ordinary shares issued in private placement | - | |||||||
| Cash withdrawn from Trust Account to public stockholder redemption | - | |||||||
| Payment of deferred offering costs | - | ( | ) | |||||
| Net cash provided by financing activities | ||||||||
| Net change in cash | ( | ) | ||||||
| Cash at the beginning of the period | - | |||||||
| Cash at the end of the period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Deferred offering costs included in accrued offerings costs and expenses | $ | - | $ | |||||
| Deferred offering costs paid by Sponsor under the promissory note-related party | $ | - | $ | |||||
| Accretion of ordinary shares subject to redemption value | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited financial statements.
4
RIBBON
ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations
Ribbon Acquisition Corp. (the “Company”) is a newly incorporated blank check company incorporated as a Cayman Islands exempted company on
As of March 31, 2026, the Company had not commenced any operations. All activity through March 31, 2026 relates to the Company’s formation and the Initial Public Offering (as defined below). The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income on cash from the proceeds derived from the Initial Public Offering. The Company has selected December 31 as its fiscal year end.
The Company’s Sponsor is Ribbon Investment Company Ltd, a Cayman Islands exempted company (the “Sponsor”). The Company’s ability to commence operations is contingent upon obtaining adequate financial resources through an Initial Public Offering (“IPO”) of
The registration statement for the Company’s IPO was declared effective on January 14, 2025. On January 16, 2025, the Company consummated its IPO of
Simultaneously with the consummation of the IPO and the sale of the Units, the Company consummated the private placement of
Transaction costs amounted to $
The Company must complete one or more Business Combinations having a fair market value of at least
5
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
Upon the closing of the Initial Public Offering, management has agreed that an aggregate of $
The Company will provide the public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of the initial Business Combination at a per- share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated as of two business days prior to the consummation of the initial Business Combination, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. The amount in the Trust Account is initially anticipated to be $
The Class A ordinary shares subject to redemption will be recorded at a redemption value and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” In such case, the Company will proceed with a Business Combination if the Company has net tangible assets of at least $
The Company will have only 12 months from the closing of the Initial Public Offering (the “Combination Period”) to complete the initial Business Combination. If the Company has not completed the initial Business Combination within the Combination Period, the Company will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, subject to lawfully available funds therefor, redeem
6
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
The Sponsor, officers and directors have agreed to (i) waive their redemption rights with respect to their initial shares, private shares and public shares in connection with the completion of our initial business combination; (ii) waive their redemption rights with respect to their initial shares, private shares and public shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (a) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem
The Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has entered into a written letter of intent, confidentiality or other similar agreement or Business Combination agreement, reduce the amount of funds in the Trust Account to below the lesser of (i) $
Extension Meetings
At an extraordinary general meeting (“Special Meeting”) held on January 9, 2026, the shareholders of the Company approved: (i)by special resolution, the adoption of the Company’s Second Amended and Restated Memorandum and Articles of Association (the “Second A&R M&A”), which extends the date by which the Company must consummate an initial business combination from January 16, 2026 to January 16, 2027, and to provide for a monthly extension payment of $
In connection with the Special Meeting, holders of
7
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
On January 26, 2026, the Company entered into Amendment No. 1 to the Investment Management Trust Agreement (the “Amendment”) with Odyssey Transfer and Trust Company, the Trustee. Effective upon the Amendment, no interest earned on the Trust Account may be withdrawn to pay dissolution expenses. The Amendment was approved by the Company’s shareholders at the meeting held on January 9, 2026, concurrent with the approval of the extension of the business combination period.
Extension Payments
On March 7, 2026, the Company issued a promissory note (the “Note”) in the principal amount of $
The Note does not bear interest and is payable promptly following the consummation of the Company’s initial business combination. The Note may be prepaid at any time without penalty. The Sponsor has agreed to waive any claim against the funds held in the Company’s trust account established in connection with the Company’s initial public offering and will not seek repayment from the trust account.
On January 14, 2026, February 17, 2026, March 17, 2026 and April 14, 2026, an aggregate of $
Business Combination Agreement
On June 30, 2025, the Company entered into a Business Combination Agreement (the “Business Combination Agreement”) by and among DRC Medicine Inc., a Delaware Corporation (“PubCo”), DRC Medicine Ltd. a Japanese corporation (“DRC Medicine”), and DRC Merger Inc., a Delaware corporation and wholly-owned subsidiary of PubCo (“Merger Sub”). The Business Combination Agreement provides, among other things, that on the terms and subject to the conditions set forth therein, (i) on or one day prior to the Closing Date (defined below), PubCo and DRC Medicine will engage in a share exchange, whereby DRC Medicine’s shareholders will exchange their shares in the company for newly issued shares of PubCo; (ii) on or one day prior to the Closing Date, the Company will de-register in the Cayman Islands and transfer by way of continuation out of the Cayman Islands and into the State of Delaware so as to migrate to and domesticate as a Delaware corporation (the “Domestication”), and (iii) following the Domestication, the Company will be merged with and into Merger Sub, as a result of which Merger Sub will be the surviving company and a wholly-owned subsidiary of PubCo (the “Merger”), (prior to the Domestication, the SPAC shall be referred to herein as “Parent”). Merger Sub, together with PubCo and DRC Medicine Ltd. may be referred to herein as the “DRC Company Parties”. The Domestication, Merger, and other transactions contemplated by the Business Combination Agreement are collectively referred to as the “Business Combination;” and the consummation of the Merger is referred to as the “Closing” and the date of the Closing is referred to as the “Closing Date.”
8
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
DRC Medicine is in the business of the design and manufacture of AI-powered allergy and infection diagnostic kits and protective face masks.
Share Exchange
On or before one day prior to the Closing Date, a holding company incorporated in Japan and holding shares in PubCo, will engage in a share exchange with shareholders of DRC Medicine, whereby the shareholders of DRC Medicine will exchange their shares in DRC Medicine for newly issued shares of PubCo. Each Common Share of DRC Medicine issued and outstanding prior to the Merger Effective Time shall be exchanged for a number of shares of PubCo Common Stock equal to the Consideration Ratio, and, accordingly, each holder of Common Shares of DRC Medicine immediately prior to said exchange shall receive, for such Common Shares of DRC Medicine that it holds, a portion of the Aggregate Merger Consideration equal to (x) the Consideration Ratio multiplied by (y) the number of Common Shares of DRC Medicine held by such holder of Common Shares of DRC Medicine immediately prior to said exchange (the “Share Exchange”).
The Domestication
One business day prior to the Closing Date, the Company shall de-register in the Cayman Islands and transfer by way of continuation out of the Cayman Islands and into the State of Delaware so as to migrate to and domesticate as a Delaware corporation in accordance with Delaware law and the Company’s governing documents (the “Domestication”).
Before the Domestication, the Company’s capitalization consists of Parent Ordinary Shares, Parent Rights, and Parent Units, collectively (all defined below). “Parent Ordinary Shares” means Parent Class A Ordinary Shares and Parent Class B Ordinary Shares. “Parent Rights” means the issued and outstanding rights of Parent, each such right convertible into
Upon the Domestication, every issued and outstanding Parent Class A Ordinary Share shall convert automatically into one share of PubCo Class A Common Stock. Further, every issued and outstanding Parent Unit shall also be separated automatically into each’s individual components of one share of PubCo’s Common Stock and one-seventh (1/7) of
The Merger
On the Closing Date, after the consummation of the Domestication, the following shall occur: (i) the Parent shall be merged with and into the Merger Sub, (ii) the separate corporate existence of the Parent shall thereupon cease, and the Merger Sub shall be the surviving corporation in the Merger (after the Merger Effective Time, the Merger Sub may be referred to as the “Surviving Corporation”), and (iii) the Surviving Corporation will remain a wholly-owned Subsidiary of PubCo (the “Merger”).
9
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
Consideration and Structure
The Aggregate Merger Consideration to be issued to the selling securityholders in connection with the Merger will be determined by dividing (a)
Representations, Warranties and Covenants
The parties to the Business Combination Agreement have agreed to customary representations and warranties for transactions of this type. In addition, the parties to the Business Combination Agreement agreed to be bound by certain customary covenants for transactions of this type, including, among others, covenants with respect to the conduct of the DRC Company Parties and the Company during the period between execution of the Business Combination Agreement and the Closing. Each of the parties to the Business Combination Agreement has agreed to use its reasonable best efforts to cause all actions and things necessary to consummate and expeditiously implement the Business Combination.
Registration Statement / Proxy Statement
As promptly as reasonably practicable after receipt of information concerning the DRC Company Parties and its securityholders as is either required by the federal securities laws or reasonably requested by the Company for inclusion in the Registration Statement (as defined below), the DRC Company Parties will prepare and file with the U.S. Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 relating to the Business Combination (the “Registration Statement”), which will contain a proxy statement relating to a meeting of the Company shareholders to be held to consider, among other things, (x) approval of the Domestication, (y) approval of the Business Combination (including the approval and adoption of the Business Combination Agreement and the Merger) and (z) the adoption and approval of certain other proposals the parties deem necessary to effectuate the Business Combination.
Conditions to Closing
Under the Business Combination Agreement, the obligations of the parties to consummate the Business Combination are subject to the satisfaction or waiver of certain customary closing conditions of the respective parties, including, without limitation: (i) the absence of specified adverse laws, rules, regulations, judgments, decrees, executive orders or awards making the Business Combination illegal or otherwise prohibiting its consummation; (ii) the Registration Statement having been declared effective by the SEC under the Securities Act of 1933, as amended (the “Securities Act”), no stop order suspending the effectiveness of the Registration Statement being in effect, and no proceedings for purposes of suspending the effectiveness of the Registration Statement having been initiated or threatened in writing by the SEC; (iii) the approval and adoption of the Business Combination Agreement and transactions contemplated thereby by requisite vote of the Parent shareholders (the “Parent Shareholder Approval”) and PubCo’s stockholders (the “PubCo Stockholder Approval”); (iv) the size and composition of PubCo’s board of directors being as set forth in the Business Combination Agreement; (v) the PubCo Common Stock having been approved for listing on the Nasdaq Stock Market LLC (“Nasdaq”) as set forth in the Business Combination Agreement; (vi) the size and composition of PubCo’s board of directors will be as set forth in the Business Combination Agreement; and (vii) the receipt by the parties of a fairness opinion for the Business Combination from an investment bank approved by the Company.
The obligations of the Company to consummate the Business Combination are further subject to additional conditions, including, among other things: (i) material compliance by DRC Company Parties with its agreements and covenants under the Business Combination Agreement; (ii) the truth and accuracy of the representations and warranties of DRC Company Parties, subject to customary bring-down standards; (iii) no Material Adverse Effect (as defined in the Business Combination Agreement) having occurred since the date of the Business Combination Agreement that is continuing; (iv) delivery of a certificate executed by the Chief Executive Officer or Chief Financial Officer of DRC Company Parties certifying compliance with specified closing conditions; (v) the termination of certain agreements among DRC Company Parties and its stockholders; (vi) receipt of required third-party consents; (vii) execution and delivery of Non-Competition Agreements by certain key employees of DRC Company Parties; and (viii) execution and delivery of a Lock-Up Agreement by DRC Company Parties’ securityholders and the Company’s Sponsor along other ancillary agreements to the Business Combination Agreement.
The obligations of DRC Company Parties to consummate the Business Combination are further subject to additional conditions, including, among others,: (i) material compliance by the Company with their respective agreements and covenants under the Business Combination Agreement; (ii) the truth and accuracy of the representations and warranties of the Company, subject to customary bring-down standards and exceptions for representations not resulting in a Material Adverse Effect (as defined in the Business Combination Agreement); (iii) receipt by the DRC Company Parties of a certificate executed by an authorized officer of the Company certifying compliance with certain conditions; (iv) the filing and effectiveness of PubCo’s certificate of incorporation with the Delaware Secretary of State; and (v) the execution and delivery by the Company of certain ancillary agreements to the Business Combination Agreement.
10
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
Termination
The Business Combination Agreement may be terminated under certain customary and limited circumstances, including, without limitation, (i) by the Company or the DRC Company Parties, if a governmental authority issues a final and non-appealable order or enacts a law permanently restraining, enjoining, or otherwise prohibiting the consummation of the Business Combination; (ii) by mutual written consent of the Company or the DRC Company Parties; (iii) by the Company or the DRC Company Parties in the event that the Parent Shareholder Approval or PubCo Stockholder Approval is not obtained by the Closing Date, which termination shall be effective upon ten (10) days’ prior written notice from the party terminating this Agreement to the other parties; (iv) by the Company, upon written notice, that the DRC Company Parties have materially breached its covenants, agreements, or representations and warranties in a way that would cause the failure of a closing condition and such breach is not cured within thirty (30) days following receipt by DRC Company Parties; (v) by the Company, if DRC Company Parties have failed to deliver audited financial statements or interim U.S. GAAP financial statements; and (vi) by DRC Company Parties, upon written notice, the Company has materially breached its covenants, agreements, or representations and warranties in a way that would cause the failure of a closing condition and such breach is not cured within thirty (30) days following receipt by the Company.
Governance
Pursuant to the Business Combination Agreement, PubCo’s board of directors will consist of five (5) members, with the Sponsor appointing one (1) director, and the DRC Company Parties appointing the remaining four (4) directors, three (3) of which shall serve as independent directors.
Timeframes for Filing and Closing
The Company expects to file the Registration Statement as promptly as practicable after the date of the Business Combination Agreement. The Closing is expected to occur following the fulfillment or waiver of the closing conditions set forth in the Business Combination Agreement.
DRC Medicine Shareholder Support Agreement
Concurrently with the execution of the Agreement, certain shareholders of the DRC Medicine entered into a support agreement, pursuant to which each such shareholder agreed to vote in favor of the business combination, subject to the terms of such shareholder support agreement.
Form of Lock-Up Agreement
In connection with the Closing certain shareholders of DRC Medicine and the Sponsor (individually, a “Holder” and collectively, the “Holders”) will enter into a lock-up agreement (the “Lock-Up Agreement”) with PubCo.
Pursuant to the Lock-Up Agreement, the Holders will agree not to transfer (except for certain permitted transfers) any shares of PubCo Common Stock held by such Holder for a period of six (6) months following the Closing Date. Permitted transfers include estate planning transfers, gifts to family members, transfers to affiliates, and other limited exceptions, provided that the transferee agrees to be bound by the same lock-up restrictions.
11
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 1 - Description of Organization and Business Operations (Continued)
Form of Amended and Restated Registration Rights Agreement
In connection with the transactions, the Company, Sponsor and certain other shareholders of PubCo, as applicable, will enter into an Amended and Restated Registration Rights Agreement to provide for the registration rights in connection with the PubCo Common Stock received in the Merger.
Note 2 - Significant Accounting Policies
Basis of Presentation
The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”), which should be read in conjunction with the financial statements and notes thereto included in the Company’s final prospectus for its IPO as filed with the SEC on January 16, 2025.
Emerging Growth Company Status
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Going Concern Consideration
As of March 31, 2026, the Company had a working capital deficit of $
The Company has incurred and expects to continue to incur significant costs in pursuit of the consummation of an initial Business Combination. In addition, the Company initially has until January 16, 2027 to consummate the initial Business Combination (assume no extensions). If the Company does not complete a Business Combination within the prescribed timeline, the Company will trigger an automatic winding up, dissolution and liquidation pursuant to the terms of the Amended and Restated Memorandum and Articles of Association. Notwithstanding management’s belief that the Company would have sufficient funds to execute its business strategy, there is a possibility that business combination might not happen within the 12-month period from the issuance date of these financial statements. In connection with the Company’s assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that the mandatory liquidation, should a business combination not occur, and potential subsequent dissolution, raises substantial doubt about the Company’s ability to continue as a going concern. Therefore, management has determined that such additional condition raise substantial doubt about the Company’s ability to continue as a going concern until the earlier of the consummation of the Business Combination or the date the Company is required to liquidate. The financial statements do not include any adjustments that might result from the Company’s inability to consummate the initial Business Combination to continue as a going concern.
12
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 2 - Significant Accounting Policies (Continued)
Use of Estimates
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash. Cash was $
Cash Held in Trust Account
As of March 31, 2026 and December 31, 2025, the Company had $
Offering Costs Associated with the IPO
Offering costs consist principally of professional and registration fees. As of January 16, 2025, offering costs totaled $
Fair Value of Financial Instruments
The fair value of the Company’s assets and liabilities, which qualify as financial instruments under FASB ASC Topic 820, Fair Value Measurement (“ASC 820”), approximates the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.
13
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 2 - Significant Accounting Policies (Continued)
Net Income (Loss) Per Ordinary Share
Net income (loss) per share is computed by dividing net loss by the weighted average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture. As of March 31, 2026, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings of the Company. As a result, diluted income (loss) per share is the same as basic income (loss) per share for the period presented.
The net income (loss) per share presented in the statement of operations is based on the following:
| For the Three Months Ended March 31, 2026 | For the Three Months Ended March 31, 2025 | |||||||
| Net income | $ | $ | ||||||
| Less: Accretion of redeemable ordinary shares subject to redemption value | ( | ) | ( | ) | ||||
| Net loss including accretion of redeemable ordinary shares to redemption value | ( | ) | ( | ) | ||||
The net income (loss) per share presented in the statement of operations is based on the following:
| For the Three Months Ended March 31, 2026 | ||||||||
| Redeemable Ordinary Share | Non-Redeemable Ordinary Share | |||||||
| Numerators: | ||||||||
| Allocation of net loss | $ | ( | ) | $ | ( | ) | ||
| Accretion of initial measurement of ordinary shares subject to redemption value | - | |||||||
| Allocation of net income (loss) | $ | $ | ( | ) | ||||
| Denominators: | ||||||||
| Weighted-average ordinary shares outstanding | ||||||||
| Basic and diluted net income (loss) per share | $ | $ | ( | ) | ||||
14
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 2 - Significant Accounting Policies (Continued)
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, “Income Taxes” (“ASC 740”). Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company’s management determined that the Cayman Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of March 31, 2026 and December 31, 2025, there were no unrecognized tax benefits and no amounts accrued for interest and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.
The Company is considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero for the period presented.
Class A ordinary shares subject to possible redemption
All of the
The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC Topic 480, “Distinguishing Liabilities from Equity” (ASC 480). Ordinary shares subject to mandatory redemption (if any) will be classified as a liability instrument and will be measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) will be classified as temporary equity. At all other times, ordinary shares will be classified as stockholders’ equity. In accordance with ASC 480-10-S99, the Company classifies the Class A ordinary shares subject to redemption outside of permanent equity as the redemption provisions are not solely within the control of the Company. All of the
Given that the
For the three months ended March 31, 2026, the Company recorded accretion of ordinary share subject to redemption value of $
As of March 31, 2026, the amount of ordinary shares subject to possible redemption reflected in the balance sheet are reconciled in the following table:
| Gross proceeds | $ | |||
| Less: | ||||
| Proceeds allocated to public rights | ( | ) | ||
| Allocation of offering costs related to redeemable shares | ( | ) | ||
| Redemption | ( | ) | ||
| Plus: | ||||
| Accretion of carrying value to redemption value | ||||
| Ordinary shares subject to possible redemption | $ |
15
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 2 - Significant Accounting Policies (Continued)
Recent Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), and in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of these standards will have on it financial statements.
Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.
Note 3 - Initial Public Offering
On January 16, 2025, the Company consummated its IPO of
Each unit has an offering price of $
Note 4 - Private Placement
Simultaneously with the closing of the IPO on January 16, 2025, the Sponsor, together with such other members, if any of the Company’s executive management, directors, advisors or third-party investors as determined by the Sponsor in its sole direction, purchased an aggregate of
Each private units were identical to the units sold in the IPO, except that it will not be redeemable, transferable, assignable or salable by the Sponsor until the completion of its initial Business Combination. There was no underwriting fees or commissions due with respect to the Private Placement.
16
RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 5 - Related Party Transactions
Initial Shares
On July 31, 2024, the Sponsor acquired
The Company’s initial shareholders have agreed not to transfer, assign or sell any of their Initial Shares and any Class A ordinary shares issuable upon conversion thereof until the earlier to occur of: (i)
Promissory Note - Related Party
On March 7, 2026, the Company issued a promissory note (the “Note”) in the principal amount of $
The Note does not bear interest and is payable promptly following the consummation of the Company’s initial business combination. The Note may be prepaid at any time without penalty. The Sponsor has agreed to waive any claim against the funds held in the Company’s trust account established in connection with the Company’s initial public offering and will not seek repayment from the trust account.
On January 14, 2026, February 17, 2026, March 17, 2026 and April 14, 2026, an aggregate of $
Working Capital Loans
In addition, in order to finance transaction costs in connection with an intended initial Business Combination, the Sponsor may, but are not obligated to, loan the Company funds as may be required. If the Company completes the initial Business Combination, it would repay such loaned amounts. In the event that the initial Business Combination does not close, the Company may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from the Trust Account would be used for such repayment. Up to $
As of the issuance date of the financial statements, the Company had no borrowings under the Working Capital Loans.
Administrative Support Services
Commencing on the effective date of the registration statement of the Initial Public Offering, the Company has agreed to pay an affiliate of the Sponsor a total of $
17
RIBBON
ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 6 - Commitments and Contingencies
Registration Rights
The holders of initial shares issued and outstanding on the date of the prospectus, as well as the holders of the private units (and underlying securities) and any securities issued to initial shareholders, officers, directors or their affiliates in payment of working capital loans made to the Company, will be entitled to registration rights pursuant to an agreement to be signed prior to or on the effective date of the offering. The holders of a majority of these securities are entitled to make up to two demands that the Company registers such securities. The holders of the majority of the initial shares can elect to exercise these registration rights at any time commencing three months prior to the end of the Lock-up period. The holders of a majority of the private units (and underlying securities) and securities issued in payment of working capital loans (or underlying securities) can elect to exercise these registration rights at any time after the Company consummates a business combination. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our consummation of a business combination. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The Company granted the underwriters a
The underwriters were entitled to a cash underwriting discount of two percent (
In addition, the underwriter has agreed (i) to waive its redemption rights with respect to such shares in connection with the completion of its initial Business Combination, and (ii) to waive its rights to liquidating distributions from the trust account with respect to such shares if the Company fails to complete its initial Business Combination within
Note 7 - Shareholder’s Equity
Class A Ordinary Shares—The Company is authorized to issue a total of
Class B Ordinary Shares—The Company is authorized to issue a total of
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RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 7 - Shareholder’s Equity (Continued)
The Initial Shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of the initial Business Combination or earlier at the option of the holder on a one-for-one basis, subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to or in connection with the closing of the initial business combination, the ratio at which Class B ordinary shares convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate,
Shareholders of record are entitled to
Rights
As of March 31, 2026, there were
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RIBBON ACQUISITION CORP.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
Note 8 - Segment Reporting
ASC Topic 280, Segment Reporting, establishes standards for companies to report, in their financial statements, information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise that engage in business activities from which it may recognize revenues and incur expenses, and for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance.
The CODM assesses performance for the single segment and decides how to allocate resources based on net income or loss that also is reported on the statement of operations as net income or loss. The measure of segment assets is reported on the balance sheet as total assets. When evaluating the Company’s performance and making key decisions regarding resource allocation, the CODM reviews several key metrics included in net income or loss and total assets.
The key measures of segment profit or loss reviewed by the CODM are administrative fee. Administrative fee is reviewed and monitored by the CODM to manage and forecast cash to ensure enough capital is available to complete a business combination or similar transaction within the business combination period. The CODM also reviews Administrative fee to manage, maintain and enforce all contractual agreements to ensure expenses are aligned with all agreements and budget. Formation costs, as reported on the statement of operations, are the significant segment expenses provided to the CODM on a regular basis.
All other segment items included in net loss are reported on the statement of operations and described within their respective disclosures.
Note 9 - Subsequent Events
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements were available to be issued. Based upon this review, except for the events mentioned in Note 1 and Note 5, the Company did not identify any other subsequent events that would have required adjustment or disclosure in the financial statements.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
References to the “Company,” “Ribbon,” “our,” “us” or “we” refer to Ribbon Acquisition Corporation. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited financial statements and the notes related thereto. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors.
Special Note Regarding Forward-Looking Statements
This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the completion of the Proposed Business Combination (as defined below), the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, including that the conditions of the Proposed Business Combination are not satisfied. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Overview
We are a blank check company incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.
We intend to effectuate our initial business combination using cash from the proceeds of the Initial Public Offering (“IPO” as defined below), and the private placement of the private placement units, the proceeds of the sale of our securities in connection with our initial business combination, our shares, debt or a combination of cash, stock and debt. We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete an initial business combination will be successful.
21
Recent Developments
On June 30, 2025, the Company entered into a Business Combination Agreement with DRC Medicine Inc., DRC Medicine Ltd. and DRC Merger Inc. in connection with the proposed business combination previously disclosed by the Company. As of the date of this Quarterly Report on Form 10-Q, there have been no material changes to the terms of that agreement.
On January 9, 2026, the Company’s shareholders approved amendments to extend the date by which the Company must consummate its initial business combination from January 16, 2026 to January 16, 2027 and to amend the Investment Management Trust Agreement to provide for monthly extension payments of $125,000 to be deposited into the trust account for each monthly extension period. The shareholders also approved the removal of the provision permitting the Company to withdraw up to $100,000 of interest earned on the trust account to pay dissolution expenses. In connection with the January 9, 2026 special meeting, holders of 1,436,867 public shares exercised their right to redeem such shares. In addition, the Company’s Second Amended and Restated Memorandum and Articles of Association became effective on January 23, 2026.
On March 7, 2026, the Company issued a promissory note in the principal amount of $600,000 to Ribbon Investment Company Ltd. The note is non-interest bearing and is payable promptly following the consummation of the Company’s initial business combination.
On January 14, 2026, February 17, 2026 and March 17, 2026, an aggregate of $375,000 was deposited into the trust account of the Company for the benefit of its public shareholders in connection with a previously approved monthly extension of the period the Company has to consummate its initial business combination.
Subsequent to quarter end, the Company continued to seek shareholder approval of a proposed amendment to the Investment Management Trust Agreement that would revise the monthly contribution payable in connection with each one-month extension to a maximum of $50,000 per month. The extraordinary general meeting relating to that proposal was adjourned multiple times, including to April 13, 2026 and then to September 14, 2026. On April 14, 2026, the Company deposited an additional $125,000 into the trust account in connection with another previously approved monthly extension.
Results of Operations
We have neither engaged in any operations nor generated any revenues to date. Our only activities from July 17, 2024 (inception) through March 31, 2026 have been organizational activities, those necessary to consummate the IPO, and, following the IPO, activities relating to the identification and evaluation of prospective targets for an initial business combination. Since entering into the Business Combination Agreement on June 30, 2025, our activities have been primarily focused on consummating the proposed business combination with DRC Medicine. We do not expect to generate any operating revenues until after the completion of our initial business combination.
We expect to generate non-operating income in the form of interest income on investments held in the Trust Account after the IPO. We expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses in connection with searching for, and completing, a Business Combination.
22
For the three months ended March 31, 2026, we had a net income of $252,755, which consisted of operating expenses of $77,786 and income earned on marketable securities held in Trust Account of $330,541.
Liquidity and Capital Resources
On January 16, 2025, we consummated our IPO of 5,000,000 units (the “Units”), at $10.00 per Unit, generating gross proceeds of $50,000,000. Simultaneously with the closing of our IPO, we consummated the sale of 220,000 private placement units at a price of $10.00 per Private Placement Unit in a private placement to the Sponsor, generating total gross proceeds of $2,220,000.
Upon the closing of the IPO and the private placement on January 16, 2025, a total of $50,000,000 was placed in a trust account (the “Trust Account”) maintained by Odyssey Trust Company as a trustee and will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act of 1940, as amended (the “Investment Company Act”), and that invest only in direct U.S. government treasury obligations.
We intend to use substantially all of the net proceeds of the IPO and the private placement, including the funds held in the Trust Account, in connection with our initial business combination and to pay our expenses relating thereto, including deferred underwriting discounts and commissions payable to the underwriters in the IPO in an amount equal to 4.0% of the total gross proceeds raised in the IPO upon consummation of our initial business combination. To the extent that our share capital is used in whole or in part as consideration to effect our initial business combination, the remaining proceeds held in the Trust Account as well as any other net proceeds not expended will be used as working capital to finance the operations of the target business. Such working capital funds could be used in a variety of ways including continuing or expanding the target business’ operations, for strategic acquisitions and for marketing, research and development of existing or new products. Such funds could also be used to repay any operating expenses or finders’ fees which we had incurred prior to the completion of our initial business combination if the funds available to us outside of the Trust Account were insufficient to cover such expenses.
As of March 31, 2026, we had a working capital deficit of $1,008,960 and net cash used in operating activities of $607,002.
The Company has incurred and expects to continue to incur significant costs in pursuit of the consummation of its initial business combination. On January 9, 2026, the Company’s shareholders approved amendments extending the date by which the Company must consummate its initial business combination from January 16, 2026 to January 16, 2027. The Company may seek to fund its working capital needs through additional borrowings from its Sponsor or its affiliates, including the $600,000 promissory note issued to Ribbon Investment Company Ltd. on March 7, 2026. There can be no assurance that the Company’s plans to consummate an initial business combination will be successful within the prescribed time period or that additional financing will be available on acceptable terms, or at all. Accordingly, management has determined that these conditions raise substantial doubt about the Company’s ability to continue as a going concern until the earlier of the consummation of the initial business combination or the date the Company is required to liquidate. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
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Off-Balance Sheet Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2026. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Contractual Obligations
Administrative Services Agreement
Our sponsor has agreed, commencing from the date that our securities are first listed on Nasdaq through the earlier of the consummation of our initial business combination and our liquidation, to make available to us certain general and administrative services, including office space, administrative and support services, as we may require from time to time. We have agreed to pay our sponsor $10,000 per month for these services.
Underwriting Agreement
The underwriters will be entitled to a cash underwriting discount of two percent (2%) of the gross proceeds of the Proposed Public Offering, or $1,000,000 (or up to $1,150,000 if the underwriters’ over-allotment is exercised in full). Additionally, the underwriters will be entitled to a deferred underwriting discount of 4% of the gross proceeds of the Proposed Public Offering held in the Trust Account upon the completion of the Company’s initial Business Combination subject to the terms of the underwriting agreement.
Business Combination Agreement
On June 30, 2025, Ribbon entered into a Business Combination Agreement by and among DRC Medicine Inc., a Delaware Corporation, DRC Medicine Ltd. a Japanese corporation, and DRC Merger Inc., a Delaware corporation and wholly-owned subsidiary of PubC. As part of the proposed transaction contemplated by the Business Combination Agreement, an intermediate holding company incorporated in Japan will acquire the shares of PubCo, after which the Intermediate Co. will engage in a share exchange transaction with the shareholders of the DRC Medicine, such that DRC Medicine will become a wholly-owned subsidiary of Intermediate Co. and the shareholders of the DRC Medicine will become shareholders of PubCo. One business day prior to the Closing Date, as defined in the Business Combination Agreement, Ribbon shall de-register in the Cayman Islands and transfer by way of continuation out of the Cayman Islands and into the State of Delaware so as to migrate to and domesticate as a Delaware corporation in accordance with Delaware law and the Ribbon’s governing documents.
On the Closing Date and after the consummation of the Domestication, Ribbon will merge with and into the Merger Sub, with the Merger Sub continuing as the surviving company in the Merger and remaining a wholly owned subsidiary of PubCo.
The aggregate merger consideration to be issued to the selling securityholders in connection with the Merger will be determined by dividing (a) 350,000,000 by (b) the price at which each of Ribbbon Class A Ordinary Shares may be redeemed in connection with the Business Combination. The “Consideration Ratio” is the number of shares of PubCo Common Stock to be issued in exchange for issued and outstanding capital stock upon the Merger and is equal to the quotient obtained by dividing (x) the aggregate merger consideration by (y) the aggregate fully diluted Company Shares, as defined in the Business Combination Agreement.
24
Critical Accounting Policies and Estimates
The preparation of unaudited financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have not identified any critical accounting policies and estimates.
Recent Accounting Standards
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), and in January 2025, the FASB issued ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of these standards will have on it financial statements.
Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s unaudited condensed financial statements.
Off-Balance Sheet Arrangements; Commitments and Contractual Obligations; Quarterly Results
As of March 31, 2026, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations.
JOBS Act
On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions, we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our initial public offering or until we are no longer an “emerging growth company,” whichever is earlier.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not required for smaller reporting companies.
Item 4. Controls and Procedures.
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management including our Chief Executive Officer, Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Our Chief Executive Officer and Chief Financial Officer carried out an evaluation with the participation of management of the effectiveness of our disclosure controls and procedures as of the end of the quarter ended March 31, 2026, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that during the period covered by this report, our disclosure controls and procedures were effective.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended March 31, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Internal Controls
A control system, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. In addition, the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
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PART II – OTHER INFORMATION
Item 1. Legal Proceedings.
There is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team in their capacity as such.
Item 1A. Risk Factors.
As a smaller reporting company, we are not required to make disclosures under this Item.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
In August 2024, our Sponsor paid $25,000 in exchange for 1,437,500 initial shares, $0.0001 per share. In addition, 187,500 of such initial shares were forfeited as the underwriters’ over-allotment option in the Issuer’s initial public offering was not exercised.
On January 16, 2025, the Company consummated its initial public offering of 5,000,000 units. Each Unit consists of one Class A ordinary share, par value $0.0001 per share, of the Company and one right to receive one-seventh (1/7) of one Class A ordinary share upon the consummation of the Company’s initial business combination. The Units were sold at an offering price of $10.00 per Unit, generating total gross proceeds of $50,000,000. The Company also granted the underwriters a 45-day option to purchase up to an additional 750,000 units to cover over-allotments, if any.
Simultaneously with the consummation of the IPO and the sale of the Units, the Company consummated the private placement (the “Private Placement”) of 220,000 Units (the “Placement Units”), each Placement Unit consisting of one Class A ordinary share and one right to receive one-seventh (1/7th) of one Class A ordinary share, to the Sponsor at a price of $10.00 per Placement Unit, generating total proceeds of $2,200,000. The issuance of the Placement Units was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended.
A total of $50,000,000 of the net proceeds from the IPO and the Private Placement were placed in a U.S.-based trust account established for the benefit of the Company’s public shareholders and maintained by Odyssey Trust Company, acting as trustee.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not Applicable.
Item 5. Other Information.
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Item 6. Exhibits
| Exhibit No. | Description | |
| 31.1 | Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2 | Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1 | Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 32.2 | Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS | Inline XBRL Instance Document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: May 15, 2026
| Ribbon Acquisition Corporation | ||
| By: | /s/ Angshuman (Bubai) Ghosh | |
| Name: | Angshuman (Bubai) Ghosh | |
| Title: | Chief Executive Officer and Chairman | |
| (Principal Executive Officer) | ||
| Ribbon Acquisition Corporation | ||
| By: | /s/ Zhiyang (Anna) Zhou | |
| Name: | Zhiyang (Anna) Zhou | |
| Title: | Chief Financial Officer | |
| (Principal Accounting and Financial Officer) | ||
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