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PHOENIX, AZ – Fold Holdings, Inc. (NASDAQ:FLD), a finance services company, has entered into a substantial financial agreement involving a convertible note and bitcoin collateral, as per its recent SEC filing. On March 6, 2025, Fold Holdings issued a convertible note valued at approximately $46.3 million to SATS Credit Fund LP, which can be converted into around 3.7 million shares of Fold’s common stock at a price of $12.50 per share.
In an unconventional move, the investment was secured with 500 bitcoin as collateral, which will be the sole recourse for the note. This bitcoin is to be held in Fold’s treasury and cannot be utilized for operational purposes unless released upon conversion of the note. The note matures on March 6, 2030, and accrues interest at 7.0% per annum, payable quarterly in common stock at the agreed conversion price. InvestingPro data reveals the company maintains a current ratio of 1.22, indicating adequate short-term liquidity despite its overall weak financial health score.
The agreement also included the issuance of a warrant for the purchase of up to 925,590 shares of common stock at $15.00 per share, 750,000 shares of common stock, and 25 bitcoin in lieu of the first year’s interest payment. The note will automatically convert into shares of common stock at the $12.50 conversion price if the stock’s closing price exceeds certain thresholds for a specified period, with full conversion at a share price equal to or exceeding $40.00.
Should these share price thresholds not be met during the term of the note, and if no conversion is elected by the investor, Fold is obligated to repay the outstanding principal by transferring bitcoin to the investor based on a pre-determined reference price.
Fold Holdings also entered into a registration rights agreement with the investor, granting customary shelf and piggyback registration rights for the conversion shares and the shares underlying the warrant.
This strategic financial maneuver was approved by Fold’s board of directors, with Chairman Jonathan Kirkwood recusing himself due to his affiliation with the investor through Ten31, LLC. The company’s business address is listed as 11201 North Tatum Blvd., Suite 300, Unit 42035, Phoenix, Arizona, 85028, with a business phone number of (866) 365-3277.
Fold Holdings’ actions reflect a unique blend of traditional finance and cryptocurrency, as they leverage digital assets to support their financial structuring. This information is based on a press release statement from the SEC filing by Fold Holdings, Inc.
In other recent news, Fold Holdings, Inc. has significantly increased its bitcoin holdings, now ranking among the top ten U.S. public companies with the largest bitcoin treasuries. The company acquired 475 bitcoins through a convertible note, boosting its total to over 1,485 bitcoins. This move underscores Fold’s commitment to maintaining bitcoin as a primary reserve in its corporate treasury. Additionally, the company purchased 10 more bitcoins at an average price of $87,500 each, further solidifying its strategy to capitalize on bitcoin’s long-term potential.
Fold’s CEO, Will Reeves, emphasized the company’s dedication to integrating bitcoin into its business and treasury strategies. The company’s recent listing on Nasdaq provides investors an opportunity to align with Fold’s vision of a bitcoin-centric financial future. Analysts have noted Fold’s strategic positioning in the evolving financial landscape, where bitcoin is increasingly being adopted as a reserve asset. While Fold’s outlook is optimistic, it is important to note that these forward-looking statements are subject to market risks and uncertainties.
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