Related Party Transactions

3 Months Ended

Mar. 31, 2024

Related Party Transactions

Related Party Transactions

Note 6 — Related Party Transactions

Founder Shares

On June 14, 2022, the Company issued 10,000 ordinary shares of a par value of $0.0001 each to the Sponsor. On August 30, 2022, the Sponsor acquired 1,725,000 ordinary shares (the “Founder Shares”) for a purchase price of $25,000 and surrendered 10,000 ordinary shares for a par value of $0.0001 each. Those shares issuance and cancelation were considered as a recapitalization, which were recorded and presented retroactively. On December 27, 2022, the underwriters exercised the over-allotment option in full, so there are no Founder Shares subject to forfeiture.

Simultaneously with the effectiveness of the registration statement and prior to the closing of the IPO (including the full exercise of over-allotment option), the Sponsor transferred to the Company’s independent directors, Messrs. Angel Colon, Mark Singh, and Rodolfo Jose Gonzalez Caceres, 8,000, 5,000 and 5,000 Founder Shares, respectively, pursuant to a certain securities transfer agreement (the “Securities Transfer Agreement”) dated September 12, 2022 among the Company, the transferees and the Sponsor.

The transfer of the Founders Shares to the Company’s independent directors, as described above, is within the scope of FASB ASC Topic 718, “Compensation-Stock Compensation” (“ASC 718”). Under ASC 718, share-based compensation associated with equity-classified awards is measured at fair value upon the grant date. The fair value of the 18,000 Founder Shares transferred to the Company’s independent directors was approximately $93,780 or $5.21 per share.

Promissory Note — Related Party

On August 30, 2022, the Sponsor agreed to loan the Company up to $500,000 to be used for a portion of the expenses of the IPO. This loan is non-interest bearing, unsecured and is due at the earlier of (1) August 31, 2023 or (2) the date on which the Company consummates an initial public offering of its securities. Total amount of $389,200 under the Promissory Note was fully repaid upon closing of the IPO on December 27, 2022. This note has been terminated after the repayment.

On September 26, 2023, in connection with the payment of the Monthly Extension Fee, the Company issued an unsecured promissory note in the principal amount of $70,000 to the Sponsor (the “Sponsor Extension Note”). The Sponsor Extension Note bears no interest and is payable in full upon the earlier to occur of (i) the consummation of the Company’s initial Business Combination or (ii) the Maturity Date. As the payee of the Sponsor Extension Note, the Sponsor, has the right, but not the obligation, to convert the Sponsor Extension Note, in whole or in part, respectively, into the Extension Units. The number of Extension Units to be received by the Sponsor in connection with such conversion shall be an amount determined by dividing (x) the sum of the outstanding principal amount payable to the Sponsor by (y) $10.00.

As of March 31, 2024 and December 31, 2023, the Company had borrowings of 70,000, under the Sponsor Extension Note from the Sponsor.

Working Capital Loans

In addition, in order to finance transaction costs in connection with an intended initial Business Combination, or to extend the Combination Period, the Sponsor or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required. Any such loans would be on an interest-free basis and would be repaid only from funds held outside the Trust Account or from funds released to the Company upon completion of the Company’s initial Business Combination. Up to $3,000,000 of such loans may be convertible into units at a price of $10.00 per unit, at the option of the lender. The units would be identical to the Private Placement Units issued to the Sponsor. The Company does not expect to seek loans from parties other than the Sponsor or an affiliate of the Sponsor as the Company does not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in the Company’s Trust Account, but if the Company does, it will request such lender to provide a waiver against any and all rights to seek access to funds in the Trust Account.

As of March 31, 2024 and December 31, 2023, the Company had no borrowings under the working capital loans.