Company: GCL
Filing Date: 2025-08-27
Form Type: DRS
Source: 0001213900-25-080905
Chunk: 231

Company: GCL Global Holdings Ltd
Filing Date: 2025-08-27
Form: DRS
Chunk 231
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 equity.

<div align='center'>F-15

GCL GLOBAL HOLDINGS LTD AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</div>

The Company accounts for
warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms
and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) ASC 480, Distinguishing Liabilities
from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the
warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether
the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the
Company’s own ordinary shares and whether the warrant holders could potentially require “net cash settlement” in a
circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires
the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while
the warrants are outstanding.

For issued or modified warrants
that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time
of issuance. The Company determined that upon further review of the warrant agreements, the Company concluded that its warrants qualify
for equity accounting treatment.

Upon completion of the Business
Combination, all of RFAC’s public and private placement warrants remain outstanding were replaced by the Company’s public
and private placement warrants. The Company treated such warrants replacement as a warrant modification and recognized incremental fair
value of $12,014 as a deemed dividend paid to the warrant holders.

The Company follows the
revenue accounting requirements of Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers
(Topic 606) (“Accounting Standards Codification (“ASC”) 606”). The core principle underlying the revenue recognition
of this ASU allows the Company to recognize revenue that represents the transfer of goods and services to customers in an amount that
reflects the consideration to which the Company expects to be entitled in such exchange. This requires the Company to identify contractual
performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of
goods and services transfers to a customer.

To achieve that