Company: VLDXW
Filing Date: 2025-08-07
Form Type: S-1
Source: 0001641172-25-022475
Chunk: 303

Company: Velo3D, Inc.
Filing Date: 2025-08-07
Form: S-1
Chunk 303
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 Fees for Services performed during such period, and for each one year period beginning on the one year anniversary of the Effective Date for the term of the MSA, Momentus shall receive 50% of $ 3,000,000less Service Fees for Services performed during each such period. The amount in the Prepaid Reserve shall be reduced by the same amounts paid to Momentus. Such payments shall be made quarterly throughout the term of the MSA within 30 days following the end of each such quarter; provided however that if the Prepaid Reserve is not sufficient to settle the full amount of such payments when due, such amounts will be paid as soon as funds are deposited into the Prepaid Reserve. Velo3D shall use commercially reasonable efforts to sell a sufficient number of shares of Momentus Common Stock such that the Prepaid Reserve has sufficient funds to make payments required by this MSA and to cover the Service Fees for the Services requested by Momentus under the MSA.

In the event the MSA is terminated, the number of shares that remain unsold by Velo3D shall be forfeited by Velo3D and cancelled by Momentus. Any funds in the Prepaid Reserve and work product shall be returned to the respective parties.

The Company evaluated the MSA to determine whether any embedded feature of the MSA potentially qualifies as a derivative required to be separately accounted for in accordance with FASB ASC Topic 815, Derivatives and Hedging. The Refund Provision clause requires the Company to refund a portion of the share-based consideration received if services are not rendered, with the refund amount limited to the lesser of a specified threshold or the net proceeds from the sale of Momentus shares. Management determined that the Refund Provision is required to be bifurcated from the MSA and accounted for separately as a derivative liability. However, based on a valuation analysis as of June 30, 2025, the fair value of the embedded derivative was determined to be de minimis. Accordingly, no separate recognition of the embedded derivative was made in the unaudited condensed consolidated interim financial statements.

The Company has evaluated the accounting treatment for the equity received
under the MSA with Momentus and determined that the arrangement does not currently meet the criteria to be accounted for under ASC 606
as the Company cannot identify the specific goods and services to be transferred or the related payment terms. The Company will reassess
the accounting for the MSA upon the execution of a Statement of Work. For the three and six months