Company: CSLMF
Filing Date: 2025-07-03
Form Type: DEFM14A
Source: 0001193125-25-155514
Chunk: 662

Company: CSLM ACQUISITION CORP.
Filing Date: 2025-07-03
Form: DEFM14A
Chunk 662
---
 $69.7 thousand, which is recorded in loss on extinguishment of payable in the consolidated statement of operations and
comprehensive loss for the year ended December 31, 2024. In accordance with ASC 470-20-25-13, the offset to the loss on
extinguishment of $69.7 thousand was recorded as an increase to additional paid-in capital as the premium associated with the new obligations issued under the Second Agreement was determined to be
substantial. The $408.9 thousand obligation incurred under the initial consulting agreement, which is described in the Second Agreement, is recorded in accounts payable in the unaudited condensed consolidated interim balance sheet as of March
31, 2025 and December 31, 2024.

The fair value of the new obligations used to determine the loss on extinguishment was determined
using a probability-weighted expected return method/scenario-based method. The significant inputs to the valuation method were an estimate of the probability of the Merger closing, an estimate of the date the Merger will close, an estimate of the
fair value of the Fusemachines shares (estimate based on an income approach and market approach in accordance with Internal Revenue Service Ruling 59-60 for compliance with Internal Revenue Code
Section 409A) to be issued upon the closing of the Merger, and an estimated discount rate. As the method for estimating the fair value of the new obligations used significant unobservable inputs, it was determined to represent a Level 3
fair value measurement.

Guarantees and Indemnifications

In the normal course of business, the Company enters into agreements that contain a variety of representations and provide for general
indemnification. The Company’s exposure under these agreements is unknown because it

F-136

involves claims that may be made against the Company in the future. To date, the Company has not paid any claims or has been required to defend any action related to its indemnification obligations. As of March 31, 2025 and December 31, 2024, the Company does not have any material indemnification claims that were probable or reasonably possible and consequently has not recorded related liabilities. Litigation Fusemachines Inc. received a legal notice dated March 27, 2025, requiring payment of $76.3 thousand to a vendor under a Work Labor & Services agreement due to alleged non-fulfilmentof payment obligations. Based on its assessment of the services received and contractual terms, management believes that