Company: CDAQF
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001641172-25-023544
Chunk: 87

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 8
Chunk 87
---
 will become a wholly-owned subsidiary of Pubco, and Pubco will become a publicly traded company upon the Closing.

Share
Exchange and Consideration

The
base consideration to be paid to the Sellers is $300,000,000 (subject to increase to the extent that the Company’s unpaid transaction
expenses and cash liabilities as of the Closing that the Sponsor does not pay in cash exceeds $5,000,000, and subject to decrease to
the extent that the amount of EEW’s unpaid transaction expenses is more than $5,000,000), and will be paid entirely in the form
of newly issued ordinary shares of Pubco, par value $0.0001 per share (the “Pubco Ordinary Shares”), with each share valued
at $10.00 (such shares, the “Exchange Shares”).

In
addition to the base consideration as set forth above, the Sellers will be entitled to receive up to an additional 4,200,000 Pubco Ordinary
Shares, subject to equitable adjustment for share splits, share dividends, combinations, recapitalizations and the like after the Closing,
including to account for any equity securities into which such shares are exchanged or converted (the “Earnout Shares”),
as additional consideration from Pubco in the event that:

(i)
If during the 3-year period after the Closing (the “Earnout Period”), the volume-weighted average price for Pubco Ordinary
Shares for 20 out of 30 consecutive trading days is at least: (i) $11.00 per share, the Sellers will receive 50% of the Earnout Shares
and (ii) $12.00 per share, the Sellers will receive the remaining 50% of the Earnout Shares; or

(ii)
If Pubco’s consolidated earnings before interest, taxes, depreciation, and amortization for the fiscal year ended April 30, 2025
equals or exceeds $41.9 million, subject to certain adjustments, the Sellers will receive all of the Earnout Shares.

If
there is a change-in-control transaction during the Earnout Period, to the extent that the express or implied price per Pubco Ordinary
Share in such transaction is equal to or greater than the applicable share price targets as set forth above, the vesting of such Earnout
Shares will accelerate, and the Earnout Shares will be issuable upon the closing of such transaction.

    8

COMPASS
DIGITAL ACQUISITION CORP.

NOTES
TO UNAUD