Company: CXAI
Filing Date: 2025-03-07
Form Type: 424B3
Source: 0001829126-25-001566
Chunk: 16

Company: CXApp Inc.
Filing Date: 2025-03-07
Form: 424B3
Chunk 16
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 dollar. Aggregate foreign currency net transaction gain or loss were approximately
$42
thousand loss, $34
thousand gain, $31
thousand gain, $8
thousand loss, and $28
thousand loss for the three months ended September 30, 2024 (Successor), for the nine months ended September 30, 2024 (Successor), for
the three months ended September 30, 2023 (Successor), for the period from March 15, 2023 to September 30, 2023 (Successor), and the period
from January 1, 2023 to March 14, 2023 (Predecessor), respectively.

Convertible Debt

The Company issued convertible debt in May 2024,
and evaluated to determine whether they contain features that qualify as embedded derivatives in accordance with ASC 815. Embedded derivatives
must be separately measured from the host contract if all the requirements for bifurcation are met. The assessment of the conditions surrounding
the bifurcation of embedded derivatives depends on the nature of the host contract and the features of the derivatives. In accounting
for the issuance of the convertible debt, the Company treats the instrument wholly as a liability, in accordance with ASC 470, as the
conversion features do not require bifurcation as a derivative in accordance with ASC 815 and the convertible debt was not issued at a
substantial premium.

Costs directly associated with the borrowing have been capitalized and are netted against the corresponding debt
liabilities in the Company’s Condensed Consolidated Balance Sheets at issuance and amortized over the contractual term of the convertible
debt instrument using the effective interest rate method.

Debt Issuance Costs

The costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method. The amendments to FASB ASC 835-30 require that debt issuance costs be presented in the Condensed Consolidated Balance Sheets as a direct deduction from the carrying amount of long-term debt, consistent with debt discounts or premiums.

Debt Extinguishment

The note exchanges are accounted for under ASC
470-50 on Modifications and Extinguishments. This standard requires the recognition of a gain or loss on the difference between the reacquisition
price and the net carrying amount of the extinguished debt.

Revenue Recognition

The Company recognizes revenue, in accordance
with ASC 606, when control of the promised products or services