Company: GCL
Filing Date: 2025-09-09
Form Type: 424B3
Source: 0001213900-25-086274
Chunk: 226

Company: GCL Global Holdings Ltd
Filing Date: 2025-09-09
Form: 424B3
Chunk 226
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in accordance with ASC 805-10-55-28. The Company determined the fair value of the contingent consideration for acquisition as the Company
has the obligation to pay cash or issuing shares to settle the contingent consideration upon 2Game’s achievement of certain performance
milestones.

In accordance with ASC 815-40
“Derivatives and Hedging”, the Company determined that the contingent consideration for acquisition should classified as
a liability as it does not consider indexed to the Company’s stock. As a result, the contingent consideration for acquisition shall
be measured initially, and subsequently at fair value on each reporting date. The Company will continue to adjust the carrying value
of the contingent consideration for acquisitions until contingency is finally determined. Any changes in fair value will be recorded
as a gain or loss in the statements of operations and comprehensive income (loss).

Contingent consideration
for acquisition was valued at the time of acquisitions and each of the financial statement date, using unobservable inputs and discounted
cash flow methodology. The determination of the fair value is based on discounted cash flows, the key assumptions include the probability
of meeting each performance target and the discount factor.

The Company accounts for
convertible notes in accordance with ASC 470, Debt, and ASC 815, Derivatives and Hedging. Convertible notes that contain embedded features—such
as conversion rights, bonus shares, top-up shares, or other contingent settlement provisions—are evaluated to determine whether
the features require bifurcation and separate accounting. If the embedded features do not meet the criteria for separate accounting but
result in the instrument being accounted for as a hybrid financial instrument, the Company applies the fair value option and measures
the entire convertible note at fair value, with changes in fair value recognized as a gain or loss in the consolidated statements of
operations and comprehensive income (loss) until conversion.

Embedded features that are
not clearly and closely related to the host instrument and do not qualify for equity classification are accounted for as derivative liabilities.
These derivative liabilities are measured at fair value upon initial recognition and remeasured at each reporting date, with changes
in fair value recognized in the consolidated statements of operations and comprehensive income (loss) until the instruments are settled.

The Company accounts for
its ordinary shares subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities
from Equity”, where equity interests are determined to be conditionally redeemable upon the occurrence of certain events that are
not solely within the control of the Group