Company: EMCRF
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001641172-25-024827
Chunk: 26

Company: Embrace Change Acquisition Corp.
Filing Date: 2025-08-19
Form: 10-Q
Item: Part I, Item 1
Chunk 26
---
%) of the gross proceeds of the Offering, or $739,286
as the underwriters’ over-allotment is partially exercised. The underwriters are also entitled to a deferred fee of three point
five percent (3.50%) of the gross proceeds of the Offering, or $2,587,499 as the underwriters’ over-allotment is partially exercised
upon closing of the Business Combination. On March 4, 2024, the Company and D. Boral Capital (“D. Boral”), formerly known
as EF Hutton, division of Benchmark Investments, LLC, the underwriter of Company’s IPO, entered into a satisfaction and discharge
of indebtedness pursuant to underwriting agreement dated August 9, 2022 (the “Satisfaction and Discharge Agreement”), pursuant
to which, the underwriter agrees to revise the deferred underwriting fee of $2,587,499, to (1) $750,000 in cash on the date of the closing
of the initial business combination (the “Closing”) and (2) 200,000 of registered and unrestricted shares of the Company
(the “Granted Shares”), shall be issued and delivered to the underwriter at the Closing. The deferred fee will be paid in
cash upon the closing of a Business Combination from the amounts held in the Trust Account, subject to the terms of the underwriting
agreement. The Company evaluated the Satisfaction and Discharge Agreement and concluded that the share settlement portion of the Satisfaction
and Discharge Agreement is representative of a share-based payment transaction in which the Company is acquiring services to be used
within the Company’s operations and upon settlement agreeing to issue ordinary shares. In this case, the share settlement portion
of the Satisfaction and Discharge Agreement is within the scope of FASB ASC Topic 718, “Compensation-Stock Compensation”
(“ASC 718”). Under ASC 718, stock-based compensation associated with equity-classified awards is measured at fair value upon
the Satisfaction and Discharge Agreement executed date (the “Grant Date”). The Company used the public trading price of ordinary
shares at Grant Date to value the fair value of the Granted Shares. The fair value of the 200,000 Granted Shares was $2,216,000 in total,
or $11.08 per share. The Satisfaction and Discharge Agreement was executed on March 4, 2024, the underwriter has provided service to
the Company prior to closing of the IPO and the Company has recorded $