Company: GCL
Filing Date: 2025-07-31
Form Type: 20-F
Source: 0001213900-25-069672
Chunk: 224

Company: GCL Global Holdings Ltd
Filing Date: 2025-07-31
Form: 20-F
Item: Item 19
Chunk 224
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 the Top-Up Shares
feature was determined to be derivative liabilities under ASC 815-40, as it is not considered indexed to the Company’s own stock
due to variable settlement provisions.

The Top-Up Shares
liabilities were measured at fair value on the conversion date and at each subsequent reporting date until settlement, with changes
in fair value recognized in the consolidated statements of operations and comprehensive income (loss). The fair value of the Top-Up
Shares liability is determined using unobservable inputs and a Monte Carlo simulation model. Key assumptions include the
Company’s stock price volatility, the price floor, the expected holding period, and the risk-free discount rate.

As of February 12, 2025,
immediately prior to the conversion upon completion ofthe Business Combination, the fair value of the convertible notes was allocated
to (i) conversion feature of $22,377,734, (ii) bonus share component of $2,685,327, and (iii) top-up share feature of $2,707,836. As of
March 31, 2025, the fair value of the top-up share feature was remeasured to $3,086,519. The fair value of the conversion and bonus share
components was estimated using a scenario-based probability-weighted approach, while the top-up share feature was valued using a Monte
Carlo simulation model based on10,000simulated price paths. Valuation assumptions included stock prices of $3.05and $1.95as of February
12 and March 31, 2025, respectively, a volatility assumption of60%, risk-free rates of4.4% and3.9%, and an expected holding period
ofthreeyears. The fair value measurement of the Top-Up Shares represents Level 3 inputs under the fair value hierarchy due to the use
of unobservable inputs.

Note 17 - Deferred investment
consideration payable

                                                 March 31,                     March 31,  
                                                 2025                          2024       
  Deferred investment consideration payable      $              7,500,000      $          
 ──────────────────────────────────────────────────────────────────────────────────────────

The balance of contingent
investment consideration payable relates to the Company’s investment in Nekcom of $7,500,000in share consideration, for which the
corresponding ordinary shares have been issued and placed in escrow. These shares will not be released until the Full Recoupment Date
(see Note 5). As the Company