Company: CSLMF
Filing Date: 2025-07-03
Form Type: DEFM14A
Source: 0001193125-25-155514
Chunk: 641

Company: CSLM ACQUISITION CORP.
Filing Date: 2025-07-03
Form: DEFM14A
Chunk 641
---
 the fair value option and, in doing so, bypassed the analysis of potential embedded derivative features. The Company believes that the fair value option better reflects the underlying economics
of the 2019 and 2021 Convertible Notes. As a result, the 2019 and 2021 Convertible Notes were recorded at fair value upon issuance.

The
Company recorded a gain of $548.0 thousand and a charge $182.0 thousand related to changes in fair value for both the 2019 Convertible Note and 2021 Convertible Note, which is recorded as Gain/(loss) on change in fair value in the
unaudited condensed consolidated interim statements of operations and comprehensive loss, for the three month ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, and December 31, 2023, the lender of the 2024 Convertible Notes was considered a principal owner of the
Company, because it held greater than 10% of voting common stock of the Company (also see “Note 18 – Related Parties).

F-122

2024 Convertible Notes at fair value

In January 2024, the Company entered into two convertible promissory note agreements (the “January 2024 Convertible Notes
Agreements”) with a lender for the principal amounts of $2,000.0 thousand (“January 2024 Convertible Note A”) and $4,500.0 thousand (“January 2024 Convertible Note B”), respectively, that each bear interest at a
rate of 4.863% per annum, payable at maturity (the “January 2024 Convertible Notes”). The January 2024 Convertible Notes mature in January 2025.

The January 2024 Convertible Notes contain the following conversion features:

Optional conversion upon a qualifying financing– Before the maturity date in January 2025, if the company plans to
go through a significant funding round of the issuance of preferred stock resulting in gross proceeds of at least $5,000.0 thousand (the “January 2024 Notes Qualifying Financing”), it will let the holder know at least 10 days before
this funding round is set to happen. The holder then has the option to turn any outstanding obligations from the January 2024 Convertible Notes into shares of preferred stock when the funding round closes, based on all of the outstanding obligations
under the January 2024 Convertible Notes (the “Conversion Amount”), divided