Company: KVACU
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001213900-25-021314
Chunk: 415

Company: Keen Vision Acquisition Corp.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 3
Chunk 415
---
 for warrants as either equity-classified
or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance
in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, “Distinguishing
Liabilities from Equity” (“ASC 480”) and ASC 815, “Derivatives and Hedging” (“ASC 815”). The
assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability
pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether
the warrants are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net
cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This
assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly
period end date while the warrants are outstanding.

For issued or modified warrants that meet all
of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance.
For warrants that are recorded as a component of equity, they are measured at their fair value at the time of issuance and are not remeasured
at subsequent reporting dates. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants
are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter.
Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the consolidated statements of operations.

As the warrants issued upon the Initial Public
Offering and private placements meet the criteria for equity classification under ASC 480, therefore, the warrants are classified as equity.

Ordinary Shares Subject To Possible Redemption

The Company accounts for its ordinary shares subject
to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Ordinary
share subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value. Conditionally redeemable
ordinary shares (including ordinary shares that feature 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) are classified as temporary equity.
At all other times, ordinary shares are classified as shareholders’ equity.