Fold Holdings, Inc. - Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by Fold Holdings, Inc. on February 26, 2026, covering events occurring between February 25 and February 27, 2026. The filing details significant capital structure changes involving the entry into a new material definitive agreement and the termination of two existing debt instruments.
Key Financial Metrics and Transactions
- New Debt Issuance: Entered into a Purchase Agreement with SATS Credit Fund L.P. for a $13.0 million senior unsecured promissory note (the "New Note") and 520,000 shares of Common Stock.
- Debt Terms: The New Note carries a 10.0% annual interest rate, payable monthly, with a one-year term. It includes Bitcoin price-based prepayment triggers at $45,000, $40,000, and $37,000 per Bitcoin.
- Debt Extinguishment (March 2025 Note): Terminated a secured convertible note with a face value of approximately $46.3 million. No penalties were incurred. The 500 Bitcoin held as collateral was returned to the Company.
- Debt Extinguishment (Investor Note): Extinguished a senior convertible note secured by 521 Bitcoin (300 held by custodian, 221 in reserve). The payoff totaled approximately $27.5 million in cash ($20 million principal + $7.5 million multiple on invested capital).
- Liquidity Source: The cash used to extinguish the Investor Note was derived from the proceeds of the New Note and the sale of Bitcoin.
Material Changes Versus Prior Period
The Company significantly altered its debt profile by replacing a $46.3 million secured convertible note and a separate Investor Note with a $13.0 million unsecured note. This transaction resulted in the release of 500 Bitcoin from collateral status under the March 2025 Note and the liquidation of 521 Bitcoin previously securing the Investor Note. The Company also incurred a related party transaction with SATS Credit Fund L.P., an affiliate of lead director Jonathan Kirkwood.
Guidance, Risks, and Contingencies
- Bitcoin Price Risk: The New Note contains mandatory prepayment provisions triggered if Bitcoin prices reach specific thresholds ($45,000, $40,000, or $37,000), requiring the Company to repay up to 100% of the principal plus accrued interest.
- Related Party Transactions: The new financing and the termination of prior notes involved SATS, an affiliate of the Company's lead director. These transactions were approved by the Audit Committee.
- Debt Capacity: The New Note permits the Company to incur up to $25 million in future indebtedness (Permitted Debt Cap), excluding the New Note itself and debt for the anticipated credit card program.
- Renewal Option: The New Note is renewable for an additional year upon mutual consent and the issuance of an additional 520,000 shares of Common Stock.
Investor Verification Checklist
- Verify the current market price of Bitcoin relative to the $37,000 - $45,000 prepayment trigger levels in the New Note.
- Confirm the exact amount of Bitcoin sold to fund the $27.5 million payoff of the Investor Note and the impact on the Company's remaining Bitcoin reserves.
- Review the full text of the Purchase Agreement (Exhibit 10.1) and the New Note (Exhibit 10.2) for detailed covenants and default provisions.
- Assess the dilution impact of the 520,000 Initial Commitment Shares and potential 520,000 Renewal Commitment Shares.
- Monitor the Company's ability to service the 10% monthly interest payments on the new $13.0 million note.