Company: CDT
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001641172-25-001246
Chunk: 1022

Company: CDT Equity Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 9C
Chunk 1022
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 this option, the notice of redemption will contain the information necessary to calculate
the number of shares of Common Stock to be received upon exercise of the Publicly Traded Warrants, including the “fair market value”
in such case. Requiring a cashless exercise in this manner will reduce the number of shares to be issued and thereby lessen the dilutive
effect of a Publicly Traded Warrant redemption.

The
Private Placement Warrants are identical to the Publicly Traded Warrants, except that such warrants will be exercisable for cash or on
a cashless basis, at the holder’s option, and will not be redeemable by Conduit, in each case so long as they are still held by
the Sponsor or its permitted transferees.

As
summarized above, the Company has the option to redeem all of the Publicly Traded Warrants at a cash price of $0.01 per warrant during
the exercisability period if the Company’s common stock has closed at a trading price above $18.00 for 20 days during a 30-day
trading window. Management notes that this option is within the Company’s control, therefore it does not represent an “obligation”
and does not create a liability under ASC 480. Management considered the guidance within ASC 815-40-15-7A, noting that an exercise contingency
would not preclude permanent equity classification if all of the other equity criteria are met. As all other criteria to be classified
as permanent equity are met, the Publicly Traded Warrants are classified as permanent equity on the Consolidated Balance Sheets.

    F-35

Management
assessed the Private Placement Warrants and determined that the warrants are considered to be indexed to the entity’s own stock
and met all the criteria for permanent equity classification. As such, the Publicly Traded Warrants are classified as permanent equity
on the Consolidated Balance Sheets.

The March 2024 Warrants are not exercisable until one year after their date of issuance. Each March
2024 Warrant is exercisable into one share of the Company’s Common Stock at a price per share of $3.18 (as adjusted from time to
time in accordance with the terms thereof) for a two-year period after the date of exercisability. There is no established public trading
market for the March 2024 Warrants. Notwithstanding the foregoing, the March 2024 Warrants shall vest, and not be subject to forfeiture