Company: GOLD
Filing Date: 2025-02-10
Form Type: 10-Q
Source: 0000950170-25-016909
Chunk: 292

Company: Gold.com, Inc.
Filing Date: 2025-02-10
Form: 10-Q
Item: Item 1
Chunk 292
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) amounts due to suppliers for the use of their consigned inventory, and (iii) shortages in unallocated metal positions held by the Company in the supplier’s inventory. Unallocated or pool metal represents an unsegregated inventory position that is due on demand, in a specified physical form, based on the total ounces of metal held in the position. Amounts due under these arrangements require delivery either in the form of precious metals or in cash.Product Financing Arrangements The Company has agreements with third-party financial institutions which allow the Company to transfer its gold and silver inventory at an agreed-upon price, which is based on the spot price. Such agreements allow the Company to repurchase this inventory upon demand at an agreed-upon price based on the spot price on the repurchase date. The third-party charges a monthly fee as a percentage of the market value of the outstanding obligation; such monthly charges are classified in interest expense. These transactions do not qualify as sales, and therefore have been accounted for as financing arrangements and are reflected in the condensed consolidated balance sheet as product financing arrangements. The obligation is stated at the amount required to repurchase the outstanding inventory. Both the product financing obligation and the underlying inventory (which is entirely restricted) are carried at fair value, with changes in fair value recorded as a component of cost of sales in the condensed consolidated statements of income. Such obligations totaled $551.9 million and $517.7 million as of December 31, 2024 and June 30, 2024, respectively.For the three months ended December 31, 2024 and 2023, the interest expense related to product financing arrangements totaled $2.8 million and $2.5 million, which represents 26.6% and 24.9% of the total interest expense recognized by the Company, respectively. For the six months ended December 31, 2024 and 2023, the interest expense related to product financing arrangements totaled $5.4 million and $4.5 million, which represents 26.6% and 22.3% of the total interest expense recognized by the Company, respectively. 

16. COMMITMENTS AND CONTINGENCIESRefer to Note 16 of the Notes to Consolidated Financial Statements in the 2024 Annual Report for information relating to employment contracts and other commitments. The Company is not aware of any material changes to commitments as summarized in the 2024 Annual Report.

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Legal MattersThe Company is from time-to-time party to various lawsuits, claims and other proceedings