Company: CDT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010405
Chunk: 147

Company: CDT Equity Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 2
Chunk 147
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 forth below, we are not currently party to or aware of being subject to any material legal proceedings. However, we may from
time to time become a party to various legal proceedings arising in the ordinary course of our business, which could have a material
adverse effect on our business, financial condition, or results of operations. Regardless of outcome, litigation could impact our business
due to defense and settlement costs, diversion of management resources and other factors.

In
August 2023, prior to the Business Combination, our now wholly-owned subsidiary, Conduit Pharmaceuticals Limited, received a letter from
Strand Hanson Limited (“Strand”) claiming it was owed advisory fees pursuant to a previously executed letter. Conduit rejected
the claim from Strand and disputed the substance of the letter in full. Following such rejection, on September 7, 2023, Strand filed
a claim in the Business and Property Courts of England and Wales claiming it is entitled to be paid the sum of $2 million and, as a result
of the completion of the Business Combination, to be issued 65,000 shares of common stock. As of March 31, 2025, the potential contingency
is considered probable and reasonably estimable and as such, the Company accrued an estimated liability of $0.4 million in the accompanying
financial statements. The trial in this matter remains scheduled for October 20, 2025. We intend to vigorously defend against these claims.
Regardless of its outcome, the litigation may impact our business due to, among other things, legal costs and the diversion of the attention
of our management.

In
November and December 2024, the Company received a letter from St George Street Capital and formal complaints filed with the Intellectual
Property Office claiming the Company was assigned the US Application, and was not the sole owner, of the AZD 1656 co-crystal patent.
In January 2025, Conduit issued a counter statement to the Intellectual Property Office disputing the claim filed by St George Street
Capital. As of March 31, 2025, the damages sought by St George Street Capital are unknown and the potential contingency is not considered
probable. As such, the Company has not accrued a loss contingency in the accompanying financial statements. We intend to vigorously defend
against these claims. Regardless of its outcome, the litigation may impact our business due to, among other things, legal costs and the
diversion of the attention of our management.

Item
1A. Risk Factors.

As a