Company: FLDDW
Filing Date: 2025-01-22
Form Type: S-4/A
Source: 0001213900-25-005202
Chunk: 313

Company: Fold Holdings, Inc.
Filing Date: 2025-01-22
Form: S-4/A
Chunk 313
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 shares at the time of exercise, the participant will recognize ordinary income to the extent of the excess of the fair market value of such shares on the date the option was exercised over the purchase price for such shares, and a capital loss to the extent the fair market value of such shares on the exercise date exceeds the amount realized upon disposition. New Fold or its subsidiaries or affiliates generally are not entitled to a federal income tax deduction upon either the exercise of an option or upon disposition of the shares acquired pursuant to such exercise, except to the extent that the participant recognizes ordinary income on disposition of the shares, subject to Code limitations. Non-Section 423 Component.The Non -Section423 Component of the ESPP is not intended to qualify as an “employee stock purchase plan” under Section 423 of the Code. Accordingly, certain tax benefits available to participants in a Section 423 plan are not available under the Non -Section423 Component of the ESPP. For federal income tax purposes, a participant in the Non -Section423 Component of the ESPP generally will not recognize taxable income on the grant of an option under the ESPP, nor will New Fold be entitled to any deduction at that time. Upon the exercise of an ESPP option, a participant will recognize ordinary income, and New Fold will be entitled to a corresponding deduction, in an amount equal to the difference between the fair market value of the shares of New Fold Common Stock on the exercise date and the purchase price paid for the shares. A participant’s basis in shares of New Fold Common Stock received on exercise, for purposes of determining the participant’s gain or loss on subsequent disposition of such shares of New Fold’s Common Stock, generally, will be the fair market value of the shares of New Fold Common Stock on the date the participant exercises his or her option. Upon the subsequent sale of the shares acquired upon the exercise of an option acquired under the Non -Section423 Component of the ESPP, the participant will recognize capital gain or loss (long -termor short -term, depending on how long the shares were held following the date they were purchased by the participant prior to disposing of them). New Fold or its subsidiaries or affiliates will generally be entitled to a federal income tax deduction upon the exercise of the option to the extent that the participant recognizes ordinary income, subject to Code limitations. Plan Benefits Because the number of shares that may be purchased under the ESPP will depend on each employee’s voluntary election to participate and on the fair market value of New Fold’s common stock at various future dates, the