Company: CSTAF
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0001213900-25-027555
Chunk: 1083

Company: Constellation Acquisition Corp I
Filing Date: 2025-04-02
Form: 10-K
Item: Item 6
Chunk 1083
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 a bank deposit account. During the year ended December 31, 2024, the Company withdrew $23,671,533 from
the Trust Account in connection with the redemption.

F-13

Concentration of Credit Risk 

Financial instruments that potentially subject
the Company to concentrations of credit risk consist of cash accounts and a Trust Account in a financial institution, which, at times,
may exceed the Federal Deposit Insurance Corporation coverage of $250,000. Any loss incurred or a lack of access to such funds could have
a significant adverse impact on the Company’s financial condition.

Warrant Liabilities

The Company evaluated the public warrants and
private placement warrants (collectively, “warrants,” which are discussed in Notes 3, 4, and 8) in accordance with Accounting
Standards Codification (“ASC”) 815-40, “Derivatives and Hedging — Contracts in Entity’s Own Equity”
(“ASC 815-40”), and concluded that a provision in the warrant agreement, dated January 26, 2021, related to certain tender
or exchange offers precludes the warrants from being accounted for as components of equity. As the warrants meet the definition of a derivative
as contemplated in ASC 815, the warrants are recorded as derivative liabilities on the balance sheets and measured at fair value at inception
(on the date of the IPO) and at each reporting date in accordance with ASC 820, “Fair Value Measurement” (“ASC 820”),
with changes in fair value recognized in the statements of operations in the period of change.

Convertible Promissory Note

The Company analyzed the convertible promissory
notes to assess if the fair value option was appropriate, due to the substantial premium which results in an offsetting entry to additional
paid-in capital and under the related party guidance which precludes the fair value option, it was determined the fair value option was
not appropriate. As such, the Company accounted for the convertible promissory notes, analyzing the conversion options embedded in convertible
notes in accordance with ASC 815. ASC 815 generally requires companies to bifurcate conversion options embedded in convertible notes from
their host instruments and to account for them as freestanding derivative financial instruments.

Bifurcated embedded derivatives are initially
recorded at fair value and are then revalued at each reporting date with changes in the fair value reported as non-operating income or
expense. When the equity or convertible debt instruments contain embedded derivative instruments that are to be bifur