Company: CDAQF
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001641172-25-000421
Chunk: 831

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 4
Chunk 831
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 investors. The Company estimated the aggregate
fair value of these 742,490 Founder Shares at $4,076,270, or approximately $5.49 per share on a weighted-average basis as of July 15,
2024. As of December 31, 2024, the Company estimated the aggregate fair value of these 742,490 Founder Shares at $4,028,008, or approximately
$5.43 per share on a weighted-average basis. This estimate considers factors such as the probability of consummation of the Business
Combination, estimated concessions, and the cost of carrying charges to mitigate the investors’ exposure to fluctuations in the
price of the Founder Shares. The fair value of these Founder Shares was determined to be an expense in accordance with SAB 5T and classified
as a liability due to the variability in the number of Founder Shares to be transferred, depending on the timing of the Business Combination.

Working
Capital Loans

In
order to finance transaction costs in connection with a Business Combination, the Sponsors, affiliates of the Sponsors, or the Company’s
former officers and directors or current directors or officers may, but are not obligated to, loan the Company funds as may be required
(such loan from the Legacy Sponsor, its affiliates or the former officer and directors, the “2021 Working Capital Loan”,
and such loan from the Sponsor, its affiliates or the current directors or offices, the “2024 Working Capital Loan”, and
together, the “Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes would
either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000
of notes may be converted upon consummation of a Business Combination into warrants at a price of $1.50 per warrant. These warrants would
be identical to the Private Placement Warrants. In the event that a Business Combination does not close, the Company may use a portion
of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used
to repay the Working Capital Loans.

2021
Promissory Note Payable – Legacy Sponsor

On
December 30, 2021, there was a written agreement in place for the 2021 Working Capital Loan. The Company issued an unsecured promissory
note (the “2021 Promissory Note”)