Company: FORL
Filing Date: 2025-01-15
Form Type: 10-Q
Source: 0001829126-25-000187
Chunk: 54

Company: Four Leaf Acquisition Corp
Filing Date: 2025-01-15
Form: 10-Q
Item: Part I, Item 1
Chunk 54
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 business combination, subject to the terms of the underwriting agreement.

Administrative Support Agreement

On March 22, 2023, the Company entered into the administrative support agreement under which it pays the Sponsor a total of $10,000 per month, up until the completion of the Company’s initial business combination or liquidation, for secretarial and administrative services. The Company’s expenses related to the administrative support agreement were $30,000 and $90,000 for the three and nine months ended September 30, 2024, respectively. The Company’s expenses related to the administrative support agreement were $30,000 and $60,000 for the three and nine months ended September 30, 2023, respectively. Upon completion of the initial business combination or the Company’s liquidation, the Company will cease paying these monthly fees. As of September 30, 2024 (unaudited), $152,180 of amounts due to the Sponsor under the Administrative Support Agreement remain unpaid, and are included in Due to Related Party on the condensed balance sheets.

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Critical Accounting Policies and Estimates

The preparation of the unaudited condensed financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Significant assumptions include the fair value of the Company’s Public Warrants and Representative Shares, at their issuance dates, the valuation of the over-allotment option provided to the underwriters and the excise tax liability in connection with redemption of Class A common stock. Actual results could differ from those estimates

Derivative Financial Instruments

The Company issued Warrants to its investors, and the over-allotment option to the underwriter. The Company accounts for financial instruments as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the instruments and applicable authoritative guidance in ASC 480 and ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the instruments are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification under ASC 815, including whether the instruments are indexed to the Company’s own stock and whether the holders of the instruments could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification.

At the IPO date, the Public Warrants and Private