Company: XTKG
Filing Date: 2025-04-25
Form Type: 20-F
Source: 0001213900-25-035626
Chunk: 254

Company: X3 Holdings Co., Ltd.
Filing Date: 2025-04-25
Form: 20-F
Item: Item 19
Chunk 254
---
1,317,225(after deducting OID and other issuance
costs).

On December 5, 2024, the Company
and YA entered into an omnibus amendment agreement (the “ December 2024 modification”). Pursuant to the omnibus amendment agreement,
the Floor Price under the YA 2024 Notes will be reduced from $0.1641 (post-reverse stock split adjusted to $0.98) to $0.10 (post-reverse
stock split adjusted to $0.6) per Ordinary share, subject to the adjustment to reflect any reverse stock split effectuated by the Company.

F-33

X3 HOLDINGS CO., LTD.

Note 13 - Convertible Notes(continued)

The Group adopted ASU No.
2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ ASU 2020-06”) by using a modified
retrospective transition method. In accordance with ASU 2020-06, since the YA 2024 Notes were not issued at a substantial premium, all
of the proceeds received from the issuance are recorded as a liability on the unaudited condensed consolidated balance sheet in accordance
with ASC 470-20. That is, no portion of the proceeds from issuing are attributed to the conversion option at inception. The difference
between the principal amount and net proceeds from the issuance is considered debt discount and is amortized at their respective effective
interest rates to accrete the carrying value to its face value on the respective put dates.

During the year ended December
31, 2024, the effective interest rates of the first and second tranche of the YA 2024 Notes were ranged from7.1% and22.8%, respectively.
The aggregated effective interest expense amounted to $558,585for the year ended December 31, 2024.

The December 2024 modification
with YA was determined to be an extinguishment of debt in accordance with ASC 470. As a result, the difference between the fair value
of YA 2024 Notes immediately after the December 2024 modification and the carrying value of the YA 2024 Notes immediately before the modification
in the amount of $473,653was accounted for as a loss on debt extinguishment for the year ended December 31, 2024.

On February 16, 2025, the Company
entered into a forbearance and repayment agreement (the “ Forbearance Agreement”) with YA, pursuant to