Company: CRCL
Filing Date: 2025-08-12
Form Type: S-1
Source: 0001193125-25-178989
Chunk: 219

Company: Circle Internet Group, Inc.
Filing Date: 2025-08-12
Form: S-1
Chunk 219
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 to meet the product threshold or the reseller threshold with respect to USDC or any other stablecoin under the Collaboration Agreement, and in each case, fails to cure as provided for under the Collaboration Agreement and we and Coinbase do not reach mutual agreement with respect to renewal of the Collaboration Agreement, we may elect to exclude the party product economics or the ecosystem economics (each as defined below), respectively, for the applicable stablecoin from the monthly payment owed to Coinbase in accordance with the terms set forth in the Collaboration Agreement. The Collaboration Agreement provides that for USDC and any other stablecoin using the Licensed Marks, we make payments to Coinbase for its role in the distribution of USDC and growth in the USDC ecosystem. These payments are determined based on the daily income generated from the reserves backing such stablecoin, less the management fees charged by non-affiliated third parties for managing such reserves (such as asset management and custody fees) and certain other expenses, which is referred to as the “payment base.” From this payment base, (i) we retain a portion ranging from an annualized low-double-digit basis point to high tenth of a basis point based on the amount of USDC in circulation on such

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day, in consideration of our role as stablecoin issuer and which is designed to partially reimburse us for indirect costs of issuing stablecoins and the management of the associated reserves, such as maintaining our accounting, treasury, regulatory, and compliance functions (the “issuer retention”), (ii) we and Coinbase each receive an amount equal to the payment base multiplied by the percentage of such stablecoin that is held in the applicable party’s custodial products or managed wallet services at the end of such day (the “party product economics”), and (iii) after deducting amounts payable to other approved participants in the USDC ecosystem, Coinbase receives 50% of the remaining payment base (the “ecosystem economics”). In our consolidated financial statements, the payments made to Coinbase under the Collaboration Agreement are recorded as distribution costs with respect to the applicable stablecoin. In addition, the Collaboration Agreement permits either party (and in Coinbase’s case, subject to our right of first refusal) to launch new stablecoins using the Licensed Marks that do not already correspond to an existing stablecoin. Any new stablecoins would be subject to the same economic arrangements as USDC.

If we (i) determine in good faith that payments to Coinbase for a given stablecoin under the Collaboration Agreement would violate an applicable law or order issued by a government