Company: GDSTR
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014248
Chunk: 87

Company: Goldenstone Acquisition Ltd.
Filing Date: 2025-02-14
Form: 10-Q
Item: Item 8
Chunk 87
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 they 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 common stock 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. The Company accounted for the 5,750,000 warrants issued with the IPO as equity instruments
in accordance with ASC 480 and ASC 815.

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 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 statements of operations.

Common Stock Subject to Possible Redemption

The Company accounts for its common stock subject to possible redemption
in accordance with the guidance in ASC 480. Common stock subject to mandatory redemption is classified as a liability instrument and is
measured at fair value. Conditionally redeemable common stock (including common stock 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)
is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s common
stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of
uncertain future events. Accordingly, common stock subject to possible redemption is presented at redemption value as temporary equity,
outside of the stockholders’ equity section of the Company’s balance sheet.

The Company has made a policy election in accordance
with ASC 480-10-S99-3A and recognizes changes in redemption value in additional paid-in capital (or accumulated deficit in the absence
of additional paid-in capital) over an expected 12-month period leading up to a Business Combination.

12

As discussed in Note 1, in connection with the
votes to approve the Company’s Amended and Restated Certificate of Incorpor