Company: SIMA
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026255
Chunk: 813

Company: SIM Acquisition Corp. I
Filing Date: 2025-03-31
Form: 10-K
Item: Item 7A
Chunk 813
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writing fee, and $477,616 of other offering costs.

F-10

Concentration of Credit Risk

Financial instruments that potentially subject
the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the federal
depository insurance coverage of $250,000. Any loss incurred or a lack of access to such funds could have a significant adverse impact
on the Company’s financial condition, results of operations, and cash flows.

Financial Instruments

The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under the FASB ASC 820, “Fair Value Measurement,” approximates the carrying
amounts represented in the balance sheets, primarily due to their short-term nature.

Fair Value Measurements

Fair value is defined as the price that would
be received for sale of an asset or paid for transfer of a liability in an orderly transaction between market participants at the measurement
date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives
the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the
lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

●Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments
in active markets;

●Level 2, defined as inputs other than quoted prices in active markets that are either directly or
indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments
in markets that are not active; and

●Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring
an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs
or significant value drivers are unobservable. In some circumstances, the inputs used to measure fair value might be categorized within
different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair
value hierarchy based on the lowest level input that is significant to the fair value measurement.

Use of Estimates

The preparation of the financial statements in
conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of expenses and deferred offering
costs during