Company: FLDDW
Filing Date: 2025-01-14
Form Type: S-4/A
Source: 0001213900-25-003167
Chunk: 458

Company: Fold Holdings, Inc.
Filing Date: 2025-01-14
Form: S-4/A
Chunk 458
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 in the period those Rewards were earned. These accruals are accounted for as an adjustment to the transaction price of the original revenue transaction if the expiration relates to Revenue Rewards, or as contra -expensewithin marketing expense if the expiration relates to Marketing Rewards. F-11 Fold, Inc.
Notes to Financial Statements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.) Derivatives As our customer rewards liability results in an 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 December31, 2023 and 2022, the notional amount of the customer rewards liability outstanding was 126 and 182 bitcoin, respectively, and the derivative instrument was valued at $5.3million and $3.0million, respectively, within ‘Customer rewards liability’ on our accompanying balance sheets. For the years ended December31, 2023 and 2022, the Company recorded a loss of $4.3million and a gain of $4.6million, respectively, on the remeasurement of this liability. For more detail on the fair value measurement of this derivative instrument, refer to Note 13. Preferred stock The Company’s preferred shares are assessed at issuance for classification as liability or equity and embedded features requiring bifurcation. The Company presents outside of permanent equity any preferred stock which (i) the Company undertakes to redeem at a fixed or determinable price on the fixed or determinable date or dates, whether by operation of a sinking fund or otherwise; (ii) is redeemable at the option of the holders; or (iii) has conditions for redemption that are not solely within the control of the issuer and for which all of the holders of equally and more subordinated equity instruments of the Company would not always be entitled to also receive the same form of consideration (for example, cash or shares) upon the occurrence of the event that gives rise to the redemption. Simple Agreements for Future Equity (“SAFEs”) The Company has issued certain SAFEs that grant investors rights to participate in a future equity financing. These SAFEs are agreements that provide investors with rights to acquire certain shares upon execution of an Equity Financing or Liquidity Event. An Equity Financing is defined within these agreements as a bona fide transaction or series of transactions with the principal purpose of raising capital, pursuant to which the Company issues and