Company: FLDDW
Filing Date: 2025-08-11
Form Type: 424B3
Source: 0001213900-25-074298
Chunk: 326

Company: Fold Holdings, Inc.
Filing Date: 2025-08-11
Form: 424B3
Chunk 326
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 obligation to deliver a fixed amount of digital assets in the future, the Company has determined that it meets the definition of a derivative and marked it to fair value as discussed above. The Company has not designated this derivative instrument as a hedging instrument. As of March 31, 2025 and December 31, 2024, the notional amount of the customer rewards liability outstanding was 89 and 92 bitcoin, respectively, and the derivative instrument was valued at $7.4 million and $8.6 million, respectively, within ‘Customer rewards liability’ on our accompanying balance sheets. For the three months ended March 31, 2025 and 2024, the Company recorded a gain of $1.1 million and loss of $3.4 million, respectively, on the remeasurement of this liability. For more detail on the fair value measurement of this derivative instrument, refer to Note 15. Convertible notes and warrants In December 2024, the Company entered into a Securities Purchase Agreement (the “December 2024 SPA”) with an institutional investor for the sale of a Senior Secured Convertible Note (“December 2024 Note”) which is convertible into shares of the Company’s common stock. The Company has accounted for the December 2024 Note and related warrants using the relative fair value allocation method on the date of issuance. Refer to Note 10 for further information. The December 2024 Note contains a host liability, freestanding warrants, and an embedded conversion feature. The Company uses the guidance under FASB ASC Topic 815 Derivatives and Hedging (“ASC 815”) to determine if the embedded conversion feature must be bifurcated and separately accounted for as a derivative under ASC 815. It also determines whether any embedded conversion features requiring bifurcation and/or freestanding warrants qualify for any scope exceptions contained within ASC 815. Generally, contracts issued or held by a reporting entity that are both (i) indexed to its own stock, and (ii) classified in shareholders equity, would not be considered a derivative for the F-63 Fold Holdings, Inc.
Notes to Unaudited Condensed Financial Statements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.) purposes of applying ASC 815. Any embedded conversion features and/or freestanding warrants that do not meet the scope exception noted above are classified as derivative liabilities, initially measured at fair value, and remeasured at fair value each reporting period with change in fair value recognized in