Financial Performance - For the three months ended March 31, 2024, the Company reported a net income of $357,077, consisting of investment income of $735,578, offset by operating costs of $49,800 and a loss on modification of deferred underwriter commission of $378,501 [115]. - As of March 31, 2024, the Company had cash of $5,308 and a working capital deficit of $1,876,397 [121]. - As of March 31, 2024, the Company has not engaged in any operations or generated any revenues to date [114]. - The Company has no critical accounting estimates that could materially differ from reported amounts as of March 31, 2024 [129]. - Management does not believe that any recently issued accounting pronouncements will have a material effect on the Company's financial statements [130]. - The Company has conducted no operations to date and has no unaudited quarterly operating data included in this report [131]. Capital Structure - The Company raised gross proceeds of $73,928,550 from its initial public offering of 7,392,855 units at $10.00 per unit on August 12, 2022 [116]. - The Company placed $75,776,764 in a trust account from the net proceeds of the IPO and a portion of the private placement proceeds [119]. - The Company incurred transaction costs of $3,898,030 related to the IPO, including $739,286 in up-front underwriting fees and a deferred discount of $2,587,499 [120]. - The Company has no long-term debt or capital lease obligations, and the underwriter is entitled to a deferred fee of $2,587,499, which will be revised to $750,000 in cash and 200,000 shares upon the closing of the Business Combination [128]. Borrowings and Financing - As of March 31, 2024, the Company borrowed a total of $240,112 in convertible promissory notes from related parties for working capital purposes [122]. - The Company borrowed $841,112 from the Chief Financial Officer in convertible promissory notes for working capital and extension deposits from October 2023 to the filing of this Quarterly Report [124]. - The Company borrowed $10,000 from the Sponsor on September 8, 2023, which is convertible into units at a price of $10.00 per unit upon the consummation of the Business Combination [123]. - The Chief Financial Officer paid $144,060 to third-party vendors for working capital purposes, which are unsecured and due on demand [125]. Regulatory and Compliance - The Company received a notice from Nasdaq on October 12, 2023, indicating non-compliance with the minimum holder requirement, with a deadline to submit a compliance plan by November 27, 2023 [104]. - On October 20, 2023, the Company amended its Articles of Association to remove restrictions on undertaking a Business Combination with entities based in the People's Republic of China [101]. Operational Status - The Company has the right to extend the Combination Period four more times for an additional one month each time, from April 12, 2024, to August 12, 2024 [102]. - The Company has not entered into any off-balance sheet financing arrangements or established any special purpose entities as of March 31, 2024 [126]. - As a smaller reporting company, the Company is not required to make disclosures about market risk [133].
Embrace Change Acquisition Corp.(EMCGU) - 2024 Q1 - Quarterly Report