Company: EMCRF
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001829126-25-003812
Chunk: 66

Company: Embrace Change Acquisition Corp.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 8
Chunk 66
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 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 $1,837,499
deferred liability for the share settlement portion of the Satisfaction and Discharge Agreement at the closing of the IPO. The fair
value of Granted Shares in excess of the liability settled, in the amount of $378,501,
as a result of the Satisfaction and Discharge Agreement was recorded as loss on the modification of deferred underwriting commission
in the accompanying statements of operations.

In addition, the Company paid the representative of the underwriters, at closing of the Initial Public Offering, 1.00% of the of the IPO shares in the Company’s ordinary shares or 73,929 ordinary shares as the underwriters’ over-allotment was partially exercised.

Right of First Refusal

For a period beginning on the closing of the Company’s IPO and ending 6 months from the closing of a business combination, the Company have granted D. Boral a right of first refusal to act as sole investment banker, sole book running manager and/or sole placement agent for any and all future private or public equity, equity-linked, convertible and debt offerings during such period. In accordance with FINRA Rule 5110(g)(6)(A), such right of first refusal shall not have a duration of more than three years from the commencement of sales in the Company’s IPO.

    17

NOTE 9. STOCKHOLDERS’ DEFICIT

Ordinary Shares — The Company is authorized
to issue 500,000,000
ordinary shares of with a par value of $0.0001
per share. Holders of the Company’s Ordinary shares are entitled to one vote for each share.

Prior to the offering,