Company: EMCRF
Filing Date: 2025-12-10
Form Type: 10-Q
Source: 0001493152-25-027065
Chunk: 63

Company: Embrace Change Acquisition Corp.
Filing Date: 2025-12-10
Form: 10-Q
Item: Part I, Item 8
Chunk 63
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 completion of the Public Offering.

    11

Ordinary
Shares Subject to Possible Redemption

As
discussed in Note 3, all of the 7,392,855 ordinary shares sold as part of the Units in the Initial Public Offering contain a redemption
feature which allows for the redemption of such Public Shares in connection with the Company’s liquidation, if there is a stockholder
vote or tender offer in connection with the Business Combination and in connection with certain amendments to the Company’s amended
and restated certificate of incorporation. In accordance with ASC 480, 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. Ordinary liquidation events, which involve
the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of ASC 480.

From
August 2023 through August 2024, 5,168,724 ordinary shares were redeemed for an aggregated of approximately $57.6 million, and the related
redemption payments have been fully settled. Following the August 12, 2024 redemption, 2,224,131 ordinary shares remained subject to
possible redemption. In connection with the shareholders’ vote at the Third Extraordinary General Meeting held by the Company on
August 12, 2025, 2,097,743 ordinary shares were tendered for redemption, leaving 126,388 ordinary shares remained subject to possible redemption. On December 4, 2025, the Company paid approximately $26 million to holders of 2,097,743 ordinary shares for the redemption
requests they submitted on August 11, 2025, and such unpaid amounts have been recorded as amount due to redeemed
public shareholders of $26,272,128 on the consolidated balance sheet as of September 30, 2025.

Accordingly,
as of September 30, 2025 and December 31, 2024, 126,388
(excluding 2,097,743
shares that have been redeemed but remained unpaid as of September 30, 2025) and 2,224,131
ordinary shares subject to possible redemption at the redemption amount were presented at redemption value as temporary equity,
outside of the stockholders’ deficit section of the Company’s consolidated balance sheets.

Income
Taxes

The
Company complies with the accounting