Company: FOXX
Filing Date: 2025-11-18
Form Type: 10-Q
Source: 0001213900-25-112192
Chunk: 21

Company: Foxx Development Holdings Inc.
Filing Date: 2025-11-18
Form: 10-Q
Item: Item 1
Chunk 21
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 specific
types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective
for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early
adoption permitted. The Company is currently evaluating the impact these standards will have on its financial statements.

In July 2025, FASB issued ASU 2025-05, Financial Instruments –
Credit Losses (Subtopic 326) (“ASU 2025-05”), to simply the Current Expected Credit Loss (CECL) model for accounts
receivable and contract assets by offering a practical expedient to use current conditions for forecasts and an accounting policy election
to consider post-balance sheet collections, allowing for early adoption for financial statements not yet issued. The guidance is effective
for annual reporting periods beginning after December 15, 2025, but early adoption is permitted. The Company is currently evaluating the
impact these standards will have on its financial statements.

12

Note 4 — Reverse recapitalization

Upon the consummation of
the Business Combination, the following transactions were completed, based on the Company’s capitalization as of September 26, 2024
(the “Closing Date”):

    (i) All 70,721 shares of Class A common stock of ACAC (“ACAC public shares”), net of redemption of 1,744,663 ACAC public shares at $11.75 per share, and all 2,156,250 shares of Class B common stock of ACAC (“ACAC private shares”), were converted on a one-for-one basis into the Company’s Common Stock. 

    (ii) 43,125 shares of the Company’s Common Stock were issued to ACAC’s underwriter, EF Hutton LLC, in connection with the Business Combination. 

    (iii) All issued and outstanding shares of Old Foxx Common Stock were cancelled in exchange for the rights for Old Foxx Shareholders, including the holders of Old Foxx’s convertible promissory notes upon the conversion of the convertible promissory notes and their interests into Old Foxx Common Stock immediately prior to Closing (see Note 13), to receive such stockholder’s pro rata share of 5,000,000 shares (“Closing Payment Shares”) of the Company’s Common Stock, including: (