Company: CDAQF
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001641172-25-010268
Chunk: 29

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 1
Chunk 29
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 and included in transaction costs attributable to Warrant liabilities.

In connection with the Non-Redemption Agreements (as
defined in Note 6), the Sponsor agreed to transfer to such investors an aggregate of 749,810 Founder Shares held by the Sponsor promptly
following the closing of the Business Combination (but no later than two business days after the satisfaction of the requisite conditions
to such transfer). The Company estimated the aggregate fair value of the 749,810 Class B Ordinary Shares attributable to such investors
to be $3,444,008 or on a weighted average of $4.59 per share as of October 19, 2023, which is estimated by taking into considerations
the estimated probability of the consummation of a Business Combination, estimated concessions and estimated cost of carrying charges
to eliminate the investor’s exposure to changes in the price of their Class B Ordinary Shares. The fair value of the Class B Ordinary
Shares was determined to be an expense in accordance with SAB 5T.

In connection with the 2024 Non-Redemption Agreements
(as defined in Note 6), the Sponsor agreed to transfer a total of 412,498 Founder Shares (representing the transfer for the first five
months of the extension period) to the investors, promptly following the closing of the Business Combination. Additionally, the Sponsor
will transfer an additional 82,498 shares for each month of extension from December 2024 through April 2025. In total, up to 742,490 Founder
Shares may be transferred to the 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 March 31, 2025 and December 31, 2024, the Company
estimated the aggregate fair value of these 742,490 Founder Shares at $4,139,382 and $4,028,008, or approximately $5.58 and $5.43 per
share, respectively, 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