Company: ZCARW
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110391
Chunk: 322

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 322
---
 ASC 470-50.

Unsecured Notes

During the six months ended September 30, 2025,
the Company has issued Bridge Notes which are repayable at the principal value along with an interest of 12% p.a. on the maturity date
and has been accounted for under ASC 470-10. The Company issued these Bridge Notes at discount and incurred expenses on the issue of these
Notes. As per ASC 835, the discount and the expenses incurred on issue of the Bridge Notes have been amortized over the contractual period
using the effective interest method. The Bridge Notes liabilities have been presented net off the discount and issue expenses.

Convertible Notes

During the six months ended September 30, 2025,
the Company has issued Convertible Notes which are repayable at the principal value along with an interest of 6-12% p.a. on the maturity
date or the holder as an option to convert those in variable number of equity shares and the same has been accounted for as a share settled
debt under ASC 480-10. The Company issued these Convertible Notes at discount and incurred expenses on the issue of these Convertible
Notes. As per ASC 835, the discount and the expenses incurred on issue of the Convertible Notes have been amortized over the contractual
period using the effective interest method. The Convertible Notes liabilities have been presented net off the discount and issue expenses.

Issuance costs on Debt 

Debt issuance costs consist primarily of initial
discount provided, arrangement fees paid to placement agent, professional fees and legal fees. These costs are netted off with the related
debt and are being amortized to interest expense over the term of the related.

The debt has been classified into current or non-current
based on the payment terms of the debt instruments. Non-current obligations are those scheduled to mature beyond twelve months from the
date of the Company’s Condensed Consolidated Balance Sheets.

70

Warrants

When the Company issues
warrants, it evaluates the balance sheet classification of the warrant to determine whether the warrant should be classified as equity
or as a derivative liability on the Condensed Consolidated Balance Sheets. In accordance with ASC 815- 40, Derivatives and Hedging- Contracts
in the Entity’s Own Equity (ASC 815-40), the Company classifies a warrant as equity so long as it is “indexed to the Company’s
equity” and several specific conditions for equity classification are met. A warrant is not considered