Company: CDT
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-024140
Chunk: 95

Company: CDT Equity Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 95
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 offering is not required and will be accounted for under the substantial premium
model. Under the substantial premium model, the excess above the fair value of the August 2024 Nirland Note will be recorded in
additional paid-in-capital. The August 2024 Nirland Note was carried at amortized cost using the effective interest method. The
Company accounted for the First Amendment as a debt extinguishment, as the First Amendment added a substantive conversion
option.

On
November 22, 2024, the Company and Nirland entered into a Second Amendment to the August 2024 Nirland Note (the “Second Amendment”).
Pursuant to the Second Amendment, the August 2024 Nirland Note may not be converted (other than partial conversions that may be permitted
pursuant to the rules and regulations of Nasdaq (or any successor entity)) prior to receipt of stockholder approval to provide for such
conversion of the August 2024 Nirland Note, and subsequent issuance of the Company’s Common Stock, pursuant to the stockholder
approval rules under the rules and regulations of The Nasdaq Stock Market. If the Company had not held a special meeting of the stockholders
to approve the full conversion of the August 2024 Nirland Note on or before January 9, 2025, then the Company was obligated to pay Nirland
a penalty of $0.1 million per day until the special meeting was held. In addition, the existing conversion rate was amended to be two
and one half times the sum of (x) the portion of the principal to be converted, redeemed or otherwise with respect to which this determination
is being made and (y) all accrued and unpaid interest (including default interest) with respect to such portion of the principal amount,
if any divided by $0.10, prior to the Reverse Stock Split, (or following any reverse splits that may occur in a ratio greater than 10
to 1, the lower of such reverse split price and the market price per share at the time of the Conversion Date, but in no event less than
$1.00), subject to adjustment as provided therein and to take into account any future share splits or reverse splits to maintain the
economic equivalence of the conversion rights as at the amendment effective date. The Company notes that the reverse split provision
in the preceding sentence was tripped following the January Reverse Stock Split.

As
of the Second Amendment, the Company elected to account for the August 2024 Nirland Note