Company: BTBT
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110383
Chunk: 36

Company: Bit Digital, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 36
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 indicates that it is probable that a material loss is incurred and the amount of the liability can be
estimated, then the estimated liability is accrued in the Company’s financial statements. If the assessment indicates that a potentially
material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the
contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.

Loss
contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee
would be disclosed.

The
Company may also enter into contractual arrangements that result in commitments, including purchase obligations. In addition, the Company
may be subject to contingent consideration obligations related to asset acquisitions, which involve potential future payments contingent
upon the achievement of specified conditions or milestones.

Share-based
compensation

The
Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant-date fair
value of the awards. The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model and the
assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent
uncertainties and the application of management’s judgment. These assumptions are the expected stock volatility, the risk-free
interest rate, the expected life of the option, and the dividend yield on the underlying stock. Expected volatility is calculated based
on the historical volatility of the Company’s ordinary shares over the expected term of the option. Risk-free interest rates are
calculated based on risk–free rates for the appropriate term. The Company has elected to account for forfeitures of awards as they
occur.

The
Company has granted RSUs to certain employees and non-employees. Some of the RSUs contain a performance condition, and vesting is determined
based on achievement of a performance metric. Compensation expense is recognized on a straight-line basis over the service period based
on the expected attainment of a performance metric. At each reporting period, the Company reassesses the probability of the achievement
of the performance metric, and any increase or decrease in share-based compensation expense resulting from an adjustment in the number
of shares expected to vest is treated as a cumulative catch-up in the period of adjustment.

Treasury
stock 

The
Company accounts for treasury stocks using the cost method. Under this method, the cost incurred to purchase the shares is recorded in
the treasury stocks