Company: GCL
Filing Date: 2025-09-04
Form Type: F-1
Source: 0001213900-25-084489
Chunk: 243

Company: GCL Global Holdings Ltd
Filing Date: 2025-09-04
Form: F-1
Chunk 243
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, the Transaction Investors will be entitled to receive certain Top-Up Shares (defined in the Note Purchase Agreement) and, under certain limited circumstances, a cash payment, based on the number of Merger Consideration Shares held on the third anniversary date of the Business Combination. The Transaction Investors will be entitled to receive 110% of the outstanding principal balance of the Note in the event that the Business Combination is not consummated on or before March 28, 2025, or if the per share price used to the calculate the Exchange Ratio for the Business Combination is less than $ 10.00per share. Epic SG has agreed to unconditionally guarantee all of the Company’s obligations and performance under $ 33,250,000of the Note, including but not limited to the Company’s obligation to pay. F-41 GCL GLOBAL HOLDINGS LTD AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS In addition, the issuance costs in connection with these Notes amounted to $ 1,590,750and were expensed in full on the issuance date, as the Company elected to account for the convertible notes at fair value under the fair value option. Upon completion of the Business Combination on February 13, 2025, the aggregate principal amount of the Notes, net of unamortized discount, amounted to $ 33,025,000which was converted into 7,338,887ordinary shares of the Company. In addition, 2,201,665shares of the Company’s ordinary shares were issued and held in an escrow account for three years as the Bonus Shares. The Company evaluated the convertible notes agreement under ASC 470 Debt (“ASC 470”), and ASC 815 Derivatives and Hedging (“ASC 815”). ASC 815 generally requires the analysis embedded terms and features that have characteristics of derivatives to be evaluated for bifurcation and separate accounting in instances where their economic risks and characteristics are not clearly and closely related to the risks of the host contract. The Company elected to measure the entire convertible note, including all embedded features, at fair value option under ASC 825 on the issuance date, with changes in fair value recognized through earnings until conversion. The fair value of the convertible notes was determined the same as its carrying value at issuance than reevaluated upon conversion by using a scenario-based probability-weighted approach for the conversion and bonus share components and a Monte Carlo simulation model for the top-up share feature. Subsequently, the component of fair value changes relating to the instrument