Company: FOXX
Filing Date: 2025-11-18
Form Type: 10-Q
Source: 0001213900-25-112192
Chunk: 187

Company: Foxx Development Holdings Inc.
Filing Date: 2025-11-18
Form: 10-Q
Item: Item 2
Chunk 187
---
 Closing on September 26, 2024. Operations prior to the Business Combination are presented as those of
Old Foxx. The net assets of ACAC are recognized at historical cost (which is expected to be consistent with carrying value), with no goodwill
or other intangible assets recorded upon execution of the Business Combination.

Transaction Financing

In consideration of market
conditions, pursuant to the Business Combination Agreement, the parties agreed to use commercially best efforts to secure financing to
pay transaction expense and working capital of Foxx, including without limitation, a PIPE financing, private financing, redemption waiver,
convertible debt, forward purchase agreement, backstop, or equity line of credit (collectively, the “Transaction Financing”).

33

On June 21, 2023, Old Foxx entered into a securities purchase agreement
(the “Convertible Note Agreement 1”) with New Bay Capital Limited, a Hong Kong registered company (“New Bay”),
and issued a promissory note (“Note 1”) to New Bay in the principal amount of $2 million with an interest rate of 7%
per annum, convertible into shares of Old Foxx common stock at $30.00 per share upon the listing of Old Foxx common stock through an initial
public offering. On December 21, 2023, Old Foxx issued into another securities purchase agreement (the “Convertible Note Agreement
2”) with New Bay with the same terms and conditions as the Convertible Note Agreement and issued another promissory note (“Note
2”) to New Bay in the principal amount of $2 million.

In connection with the Business
Combination Agreement and all the transaction contemplated therein (the “Business Combination”), in the spring of 2024, Old
Foxx and ACAC reached out to New Bay to seek its interest in participating in further financing in connection with the Business Combination.

After negotiations with New
Bay, On March 15, 2024, Old Foxx and New Bay agreed to an amendment to amend both Convertible Note Agreement 1 and Convertible Note
Agreement 2, and to amend Note 1 and Note 2, by removing the lock-up provisions as provided therein and allowing the unpaid principal
and accrued interest on Note 1 and Note 2 to convert to Old Foxx common stock immediately prior to the closing of the Business Combination.
New Bay also subscribed for a new promissory note (“Note 3”) in the principal amount of $2 million under the same terms