Related Parties Transactions

3 Months Ended

Mar. 31, 2024

Note 5 — Related Parties Transactions

Founder Shares

On November 11, 2022, December 2, 2021 and August 23, 2021, the Company issued an aggregate of 1,035,000, 840,000 and 1,000,000 ordinary shares respectively, to the Sponsor for an aggregate purchase price of $288. On June 7, 2023, the Company repurchased and canceled 1,150,000 ordinary shares from the Sponsor with a consideration of $115 and off-set the consideration receivable from the sponsor. Following which the Sponsor holds 1,725,000 ordinary shares (the “Founder Shares”) in total and total consideration receivable from the sponsor after the off-set is $173. The Company did not receive payment for the Founder Shares as of March 31, 2024 and the $173 payment due to the Company is recorded as share subscription receivable.

The registration statement for the Company’s IPO became effective on November 13, 2023. As a result of the underwriters’ full exercise of their over-allotment option on November 16, 2023, no Founder Shares are currently subject to forfeiture.

The Initial Shareholder has agreed, subject to certain limited exceptions, not to transfer, assign or sell any of its Founder Shares, (A) with respect to 50% of the Founder Shares, until the earlier of (i) six months after the date of the consummation of a Business Combination, or (ii) the date on which the closing price of the Company’s ordinary shares equals or exceeds $16.50 per share (as adjusted for share sub-division, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after the Business Combination, (B) with respect to the remaining 50% of the Founder Shares, until six months after the date of the consummation of the Business Combination, or (C) earlier, if, subsequent to the Business Combination, the Company consummates a subsequent liquidation, merger, share exchange or other similar transaction which results in all of the Company’s shareholders having the right to exchange their ordinary shares for cash, securities or other property.

Promissory Note — Related Party

On December 23, 2021, the Company’s Sponsor issued an unsecured promissory note (“Promissory Note”) to the Company, pursuant to which the Company may borrow up to an aggregate principal amount of $300,000. On October 24, 2023, the Company and the Sponsor made an amendment to the principal amount of the promissory note from $300,000 to $950,000. The Promissory Note is non-interest bearing and payable on the earlier of: (i) December 31, 2023 or (ii) the date on which the Company consummates an initial public offering of its securities. There was no outstanding balance of Promissory Note as of the Effective Date. Simultaneously with the closing of the IPO, the Promissory Note expired.

Administrative Services Agreement

The Company is obligated, commencing on November 14, 2023, to pay the Sponsor a monthly fee of $10,000 for office space, administrative and support services to such affiliate. Upon completion of a Business Combination or liquidation, the Company will cease paying these monthly fees. Accordingly, in the event the consummation of the Business Combination takes 12 months, the Sponsor will be paid a total of $120,000 ($10,000 per month) for office space, administrative and support services and will be entitled to be reimbursed for any out-of-pocket expenses.

Note 5 — Related Parties Transactions – continued

For the three months ended March 31, 2024 and 2023, the Company has recognized $30,000 and $nil, respectively, of administrative service fee, which is included in formation and operating costs on the statement of operations. As of March 31, 2024 and December 31, 2023, the balance of due to related party in connection with administrative service were $45,000 and $15,000, respectively.

Working Capital Loans

In addition, in order to finance transaction costs in connection with a Business Combination, the Sponsor, or certain of the Company’s officers and directors or their affiliates may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,000,000 of such Working Capital Loans may be converted into units of the post Business Combination entity at a price of $10.00 per unit, each unit consisting of one ordinary share and one right to receive one - sixth of one ordinary share.

As of March 31, 2024 and December 31, 2023, the Company had no borrowings under the Working Capital Loans.

Extension Loan

In order to extend the period of time to consummate a Business Combination twice by an additional three months each time, the Sponsor (and/or its designees) must deposit into the Trust Account $690,000 (approximately $0.10 per Public Share) on or prior to the date of the applicable deadline, for each three-month extension, in exchange for a non-interest bearing, unsecured promissory note, and such loan may be convertible into units at a price of $10.00 per unit, each unit consisting of one ordinary share and one right to receive one-sixth of one ordinary share.

As of March 31, 2024 and December 31, 2023, the Company had no such extension loans.

Amount Due to Related Parties

The following is a list of related parties to which the Company has transactions with:


No.	Names of related parties	Relationship
1	Miao Zhizhuang	The CEO and Charmain of the Company and the sole director of the Sponsor of the Company
2	Moore (Dalian) Technology Co., Ltd (“Moore”)	80% equity interests owned by Miao Zhizhuang’s spouse
3	Beijing Huachuan Xingrun Investment Co., Ltd (“Huachuan”)	40% equity interests owned by Miao Zhizhuang
4	Carbon Neutral Holdings Inc.	Sponsor of the Company
5	Silk Road Industry Holdings Limited (“Silk Road”)	36% equity interests owned by Miao Zhizhuang

Note 5 — Related Parties Transactions – continued

Amount due to related parties consisted of the following for the periods indicated:


	As of
	March 31, 2024		December 31, 2023
Carbon Neutral Holdings Inc. ⁽¹⁾	$	138,965	$	108,965
Moore⁽²⁾		1,412		—
Miao Zhizhuang⁽²⁾		58,167		—
Silk Road ⁽³⁾		9,868		—
Huachuan⁽²⁾		1,700		1,700
Amounts due to related parties	$	210,112	$	110,665

Related parties transaction consisted of the following for the periods indicated:


	For the three months ended March 31,
	2024		2023
Carbon Neutral Holdings Inc. ⁽¹⁾	$	30,000	$	—
Moore⁽²⁾		1,412		—
Miao Zhizhuang⁽²⁾		58,167		40,000
Silk Road⁽³⁾		9,868		—

(1)

The Sponsor repaid the amounts due to Moore, Miao Zhizhuang, and Huachuan on behalf of the Company of $793,926, $211,482 and $10,325, respectively, on November 9, 2023. On November 16, 2023, $923,200 was repaid to the Sponsor, upon the closing of the IPO out of proceeds from private placement. Also, Carbon Neutral Holdings Inc. deposited an additional $1,432 in the escrow account for Company operations on November 16, 2023. Subsequent to the closing of the IPO, the Company accrued $15,000 and $30,000 administrative service fee for the year ended December 31, 2023 and for the three months ended March 31, 2024, respectively. As of March 31, 2024 and December 31, 2023, the balance of payment in advance of Sponsor is $138,965 and $108,965, respectively.

For the three months ended March 31, 2024 and 2023, the Company has recognized $30,000 and $nil of administrative service fee, respectively. As of March 31, 2024 and December 31, 2023, the balance of due to related party in connection with administrative service were $45,000 and $15,000, respectively.

(2)	Moore, Huachuan and Miao Zhizhuang made several payments on behalf of the Company to pay the offering costs and operating costs in advance. These payments were non-interest bearing and had no due date.

(3)	Silk Road provide finance support to the Company in the amount of $9,868 on March 8, 2024. The fund was non-interest bearing and had no due date.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1
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-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

+ Details

Global Lights Acquisition Corp 10-Q