10-K: Cohen Circle II Reports 2025 Financials, Continues SPAC Search

Cohen Circle Acquisition Corp. II, a SPAC focused on fintech, reported a net income of $4.36 million for 2025, primarily from trust account interest, as it continues its search for an initial business combination.

Summary

• Cohen Circle Acquisition Corp. II is a blank check company incorporated on December 4, 2024, with the purpose of effecting a business combination, primarily targeting the financial services technology (fintech) sector.
• The company consummated its initial public offering (IPO) of 25,300,000 units on July 2, 2025, generating gross proceeds of $253,000,000.
• Simultaneously with the IPO, 720,000 placement units were sold in a private placement for $7,200,000.
• A total of $253,000,000 from the IPO and private placement proceeds was placed in a trust account, to be invested in U.S. government securities or money market funds.
• The company reported a net income of $4,355,499 for the year ended December 31, 2025, primarily from $5,050,313 in interest earned on marketable securities held in the trust account, offset by $694,814 in general and administrative costs.
• Net cash used in operating activities for the year ended December 31, 2025, was $819,729.
• As of December 31, 2025, the company had $1,852,928 in cash held outside the trust account for working capital.
• The company withdrew $400,000 in interest from the trust account for working capital purposes during 2025, with no further amounts available for permitted withdrawals until July 2, 2026.
• The sponsor, Cohen Circle Sponsor II, LLC, holds 8,673,333 Class B ordinary shares (founder shares) for a nominal price of $25,000.
• A deferred underwriting fee of $10,780,000 is payable to Clear Street LLC upon the completion of an initial business combination.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a neutral-to-slightly-positive report for a SPAC at this stage. The company has successfully completed its IPO and private placement, securing funds in the trust account, and its management has a strong track record of completing business combinations. However, the inherent risks of SPACs, including intense competition, potential dilution, and the looming deadline for a business combination, temper the overall sentiment. The positive net income from interest is expected for a SPAC.

Positives

• The management team has extensive experience in the financial services and financial technology industries, with a track record of successfully closing multiple SPAC business combinations.
• An established deal sourcing network is available through the management team's broad contacts in the financial services and venture capital industries.
• The company has a strong financial position with $253,000,000 initially deposited in the trust account, offering flexibility for a target business.
• The company's status as an existing public entity provides an attractive alternative to a traditional initial public offering for prospective target businesses.
• The company generated a net income of $4,355,499 for the year ended December 31, 2025, primarily from interest earned on trust account investments.

Negatives

• The company has no operating history or revenues to date, and its success is entirely dependent on completing a business combination.
• There is intense competition for business combination opportunities from other blank check companies, private equity groups, and operating businesses, potentially increasing acquisition costs or making it difficult to find a suitable target.
• Public shareholders face potential significant dilution due to the nominal purchase price paid by the sponsor for founder shares and their anti-dilution rights.
• Management's financial incentives, stemming from their ownership of founder shares and placement units, may create conflicts of interest with public shareholders.
• Public shareholders may not have the opportunity to vote on a proposed business combination if not required by law or Nasdaq rules.
• The ability of public shareholders to redeem their shares for cash may make the company's financial condition unattractive to potential target businesses, potentially hindering the completion of a desirable business combination.
• There is a risk of Nasdaq delisting the company's securities if certain financial, distribution, or share price levels are not maintained.
• The company may be subject to adverse U.S. federal income tax consequences, including potential Passive Foreign Investment Company (PFIC) status and the Inflation Reduction Act's excise tax on redemptions.
• The company has a limited ability to assess the management of a prospective target business, which could lead to combining with a company whose management lacks public company experience.
• Lack of business diversification post-combination is a risk if only a single business is acquired, making the company solely dependent on its performance.
• Geopolitical instability (e.g., Russia-Ukraine, Israel-Hamas conflicts) and changes in international trade policies could adversely affect the search for a target or the performance of a post-combination company.
• The market for directors and officers liability insurance for SPACs has become more difficult and expensive, potentially impacting the ability to negotiate and complete a business combination.

Risks

• Public shareholders may not be afforded an opportunity to vote on the proposed business combination.
• Sponsor, officers, and directors have agreed to vote in favor of the initial business combination, regardless of how public shareholders vote.
• The ability of public shareholders to redeem their shares for cash may make the company's financial condition unattractive to potential business combination targets.
• The ability of public shareholders to exercise redemption rights with respect to a large number of shares may not allow the company to complete the most desirable business combination or optimize its capital structure.
• The requirement to complete the initial business combination within the prescribed time frame may give potential target businesses leverage over the company.
• If net proceeds outside the trust account are insufficient, the company will depend on loans from its sponsor or management team to fund its search and complete the business combination.
• Sponsor, directors, officers, and their affiliates may elect to purchase shares from public shareholders, which may influence a vote on a proposed business combination and reduce the public float.
• Shareholders may fail to receive notice of the offer to redeem public shares or fail to comply with tendering procedures, leading to unredeemed shares.
• Public shareholders will not have any rights or interests in funds from the trust account, except under certain limited circumstances, potentially forcing them to sell shares or warrants at a loss.
• Nasdaq may delist the company's securities from trading, limiting investors' ability to make transactions and subjecting the company to additional trading restrictions.
• Investors will not be entitled to protections normally afforded to investors of many other blank check companies (e.g., Rule 419).
• Limited resources and significant competition for business combination opportunities may make it more difficult to complete the initial business combination.
• If unable to complete the initial business combination, public shareholders may receive only approximately $10.00 per share, or less in certain circumstances, and warrants will expire worthless.
• If unable to consummate the initial business combination within the prescribed timeframe, public shareholders may be forced to wait beyond such period before redemption from the trust account.
• The nominal purchase price paid by the sponsor for founder shares may result in significant dilution to the implied value of public shares upon consummation of the initial business combination.
• The grant of registration rights to initial holders and holders of placement units may make it more difficult to complete the initial business combination and adversely affect the market price of Class A ordinary shares.
• Past performance by the management team and their affiliates may not be indicative of future performance of an investment.
• The company may seek acquisition opportunities in industries or sectors that may be outside of management's areas of expertise.
• The company is not required to obtain an opinion from an independent entity that commonly renders valuation opinions, unless certain conditions are met.
• The company may reincorporate in another jurisdiction in connection with its initial business combination, which may result in taxes imposed on shareholders.
• The company may have a limited ability to assess the management of a prospective target business.
• Officers and directors presently have, and may have additional, fiduciary or contractual obligations to other entities, creating conflicts of interest.
• The company has no operating history and no revenues, providing no basis to evaluate its ability to achieve its business objective.
• The company does not have a specified maximum redemption threshold, potentially allowing completion of a business combination with which a substantial majority of shareholders do not agree.
• The sponsor will control the appointment of the board of directors until consummation of the initial business combination and will hold a substantial interest, influencing shareholder votes.
• If deemed an investment company under the Investment Company Act, the company may be required to institute burdensome compliance requirements and its activities may be restricted.
• Subsequent to the completion of the initial business combination, the company may be required to take write-downs or write-offs, restructuring and impairment or other charges.
• If third parties bring claims against the company, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.00 per share.
• The company's directors may decide not to enforce the indemnification obligations of Cohen Circle Sponsor II, LLC.
• If the company files for bankruptcy or winding-up, a court may seek to recover proceeds distributed to shareholders.
• Adverse developments affecting the financial services industry could adversely affect the company's business.
• The company may enter into its initial business combination with a target that does not meet its general criteria and guidelines.
• Compliance obligations under the Sarbanes-Oxley Act may make it more difficult to effectuate the initial business combination.
• The company may engage one or more of its underwriters or their affiliates to provide additional services, creating potential conflicts of interest.
• Investors may not have sufficient time to comply with delivery requirements for redemption.
• The company may amend the terms of the warrants in a manner that may be adverse to holders of warrants.
• The warrant agreement designates the courts of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for certain actions.
• The company may redeem unexpired warrants prior to their exercise at a time that is disadvantageous to holders, making warrants worthless.
• Management's ability to require cashless exercise of warrants will cause holders to receive fewer Class A ordinary shares.
• Warrants and founder shares may have an adverse effect on the market price of Class A ordinary shares and make it more difficult to effectuate the initial business combination.
• Because each unit contains one-fourth of one warrant, the units may be worth less than units of other blank check companies.
• A provision of the warrant agreement may make it more difficult to consummate an initial business combination under certain pricing conditions.
• Provisions in the amended and restated memorandum and articles of association may inhibit a takeover.
• If the initial business combination is with a company with operations outside the United States, the company would be subject to a variety of additional international risks.
• If management following the initial business combination is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws.
• Exchange rate fluctuations and currency policies may diminish a target business's ability to succeed in international markets.
• Attractive targets may become scarcer, increasing the cost of the initial business combination or leading to inability to find a target.
• Changes in the market for directors and officers liability insurance could make it more difficult and expensive to negotiate and complete an initial business combination.
• Changes to laws or regulations or in how such laws or regulations are interpreted or applied, or a failure to comply, may adversely affect the business.
• Recent increases in inflation and interest rates could make it more difficult to consummate an initial business combination.
• The search for a business combination may be materially adversely affected by current global geopolitical conditions (Russia-Ukraine, Israel-Hamas conflicts).
• Changes in international trade policies and tariffs may have a material adverse effect on the search for a target or the performance of a post-combination company.
• The company may not hold an annual general meeting until after the consummation of its initial business combination.
• Taking advantage of certain exemptions from disclosure requirements as an emerging growth company or smaller reporting company could make securities less attractive to investors.
• The requirements of being a public company may strain resources and divert management's attention.
• The company may be a passive foreign investment company (PFIC), which could result in adverse U.S. federal income tax consequences to U.S. investors.
• The excise tax included in the Inflation Reduction Act of 2022 may decrease the value of securities following the initial business combination, hinder ability to consummate a business combination, and decrease funds available for distribution in liquidation.
• Certain agreements related to the initial public offering may be amended without shareholder approval.
• Because the company is incorporated under the laws of the Cayman Islands, shareholders may face difficulties in protecting their interests.
• The share price of the combined company may decline after the initial business combination below the initial value of the units sold in the initial public offering.
• Since only holders of founder shares will have the right to vote on the appointment of directors, Nasdaq may consider the company a controlled company.

Future Outlook

The company intends to concentrate its efforts on identifying companies in the financial services technology (fintech) sector and fintech adjacent sectors that power transformation and innovation. It must complete an initial business combination within the completion window, which ends on July 2, 2027, or October 2, 2027, if a definitive agreement is signed by July 2, 2027. The company expects to incur significant costs in pursuing its acquisition plans and may need to obtain additional financing to complete a business combination or fund the operations and growth of a target business. It will also evaluate its internal control procedures for the fiscal year ending December 31, 2026, as required by the Sarbanes-Oxley Act.

Management Comments

• We currently intend to concentrate our efforts on identifying companies in the financial services technology (fintech) sector and fintech adjacent sectors that power transformation and innovation.
• We believe our management team has the skills and experience to identify, evaluate and consummate a business combination and is positioned to assist businesses we acquire.
• We believe that potential sellers of target businesses will view the fact that members of our board of directors and management team have successfully closed multiple business combinations with vehicles similar to our company as a positive factor in considering whether or not to enter into a business combination with us.
• The company does not believe it will need to raise additional funds in order to meet the expenditures required for operating its business (as of December 31, 2025).

Industry Context

StockSavvy.ai notes that Cohen Circle Acquisition Corp. II operates in a highly competitive SPAC market, particularly within the fintech sector. The management team's extensive track record in previous FinTech SPACs (FinTech I-VI, FTAC Olympus, INSU I-II, FTAC Emerald, Cohen Circle I) provides a competitive advantage in deal sourcing and execution. However, the broader SPAC market faces increased scrutiny and competition for attractive targets, potentially leading to higher acquisition costs or difficulty in finding suitable partners. The company's focus on fintech aligns with ongoing digital transformation trends in financial services, but also exposes it to rapid technological evolution and regulatory changes within that industry.

Comparison to Industry Standards

• The management team has a strong history of completing business combinations with various entities, including FTS Holding Corporation (CardConnect Corp.), Intermex Holdings II, Inc. (International Money Express, Inc.), Paya, Inc. (Paya Holdings Inc.), PWP Holdings LP (Perella Weinberg Partners), Payoneer Inc. (Payoneer Global Inc.), Shift Technologies, Inc., Metromile, Inc., Fold Holdings, Inc., and Kyivstar Group Ltd.
• Past performance of these acquired entities has varied, with some leading to successful acquisitions by larger firms (e.g., CardConnect Corp. by First Data Corporation, Paya Holdings by Nuvei Corporation, Metromile by Lemonade, Inc.) and others facing significant challenges, such as Shift Technologies, Inc. commencing Chapter 11 bankruptcy.
• StockSavvy.ai observes that while the management team has a strong history of completing business combinations, the outcomes for the acquired entities vary, from successful acquisitions by larger firms to bankruptcy (Shift Technologies). This mixed performance underscores the inherent risks in SPAC investments, even with experienced sponsors. The current market conditions for SPACs are more challenging than during the peak of the previous SPAC cycle, potentially impacting the ability to replicate past successes.

Corporate Governance

Legal Proceedings

• No material litigation, arbitration, or governmental proceeding is currently pending against the company or any members of its management team in their capacity as such.
• Betsy Cohen and Daniel Cohen were previously named defendants in a putative class action securities lawsuit related to RAIT Financial Trust, which was consolidated under 'In re RAIT Financial Trust Securities Litigation' and settled for a cash payment of $32 million, resulting in a full release of all claims.

Related Party Transactions

• Cohen Circle Sponsor II, LLC paid $25,000 for 8,673,333 Class B ordinary shares (founder shares).
• The sponsor purchased 445,000 placement units for $4.45 million, and Clear Street purchased 275,000 placement units for $2.75 million in a private placement.
• Non-managing sponsor investors indirectly acquired 410,000 placement units and approximately 2,050,000 founder shares through the sponsor.
• The company pays Cohen Circle Sponsor II, LLC or its affiliate $30,000 per month for office space, utilities, and shared personnel support services, commencing July 1, 2025.
• The company pays its Chief Financial Officer, R. Maxwell Smeal, up to $12,500 per month for his services, commencing June 30, 2025.
• An unsecured promissory note for up to $300,000 was issued to the sponsor on March 20, 2025, and the outstanding balance of $136,753 was repaid on July 2, 2025.
• The sponsor or an affiliate may provide Working Capital Loans (up to $2,500,000 convertible into units at $10.00 per unit) to fund working capital deficiencies or transaction costs.
• Registration rights have been granted to holders of founder shares, placement units, and units that may be issued upon conversion of Working Capital Loans.
• Cohen Circle Sponsor II, LLC has agreed to indemnify the company if third-party claims reduce trust account funds below $10.00 per public share, with certain exceptions.

Stakeholder Impact

• **Shareholders**: Face potential dilution from founder shares and future equity raises. Redemption rights offer a floor value but may limit the company's ability to complete desirable business combinations. Risk of losing investment if no business combination is completed within the completion window.
• **Sponsor/Management**: Have significant financial incentives (founder shares, placement units) to complete a business combination, which could create conflicts of interest with public shareholders.
• **Creditors**: Claims of creditors could potentially reduce the per-share redemption amount for public shareholders if not waived or indemnified by the sponsor.
• **Target Businesses**: The company's public status and available capital may be attractive, but the risk of redemptions and intense competition could make it less appealing as a merger partner.
• **Employees (post-combination)**: The future roles and compensation of management and employees of an acquired business will be determined after the business combination.

Next Steps

• Identify and evaluate target businesses, concentrating on the financial services technology (fintech) sector and fintech adjacent sectors.
• Perform business due diligence on prospective target businesses.
• Structure, negotiate, and complete an initial business combination within the completion window (by July 2, 2027, or October 2, 2027, if extended).
• Evaluate internal control procedures for the fiscal year ending December 31, 2026, as required by the Sarbanes-Oxley Act.
• Potentially seek shareholder approval for amendments to the memorandum and articles of association to extend the completion window.
• Potentially seek additional financing (equity, debt, or sponsor loans) to fund a business combination or target operations.

Key Dates

Recommendation

The company is a blank check company in its initial phase of identifying a business combination target. While the management team has a strong track record in the SPAC space, the inherent risks associated with SPACs, including the uncertainty of finding a suitable target, potential dilution, and market competition, remain significant. The current financial performance is as expected for a SPAC, primarily driven by interest income from the trust account. Investors should hold their position pending further announcements regarding a potential business combination, as the investment thesis for a SPAC is entirely dependent on the success of its acquisition.

Keywords

SPAC, Fintech, Acquisition, Blank Check Company, IPO, Warrants, Trust Account, Financial Services, Mergers, SEC Filing, 10-K, Corporate Governance, Risk Management, Capital Markets, Investment