Company: NOEMW
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001213900-25-110040
Chunk: 70

Company: CO2 Energy Transition Corp.
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 70
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815, “Derivatives and Hedging”. For derivative financial instruments
that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value upon issuance and remeasured
at each reporting date, with changes in the fair value reported in the condensed statements of operations. The classification of derivative
financial instruments is evaluated at the end of each reporting period. There were no derivative financial instruments as of September
30, 2025 and December 31, 2024.

Warrant and Right Instruments

The Company accounted for
the Public Warrants and Private Warrants and Public Rights and Private Rights issued in connection with the Initial Public Offering and
the private placement in accordance with the guidance contained in FASB ASC Topic 815 “Derivatives and Hedging”. Accordingly,
the Company evaluated and classified the warrant and right instruments under equity treatment.

13

CO2 ENERGY TRANSITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

(Unaudited) 

Common Stock Subject to Possible Redemption

The Public Shares contain
a redemption feature which allows for the redemption of such Public Shares in connection with the Company’s liquidation, or if there
is a stockholder vote or tender offer in connection with the Company’s initial Business Combination. In accordance with ASC 480-10-S99,
the Company classifies Public Shares subject to redemption outside of permanent equity as the redemption provisions are not solely within
the control of the Company. The Public Shares sold as part of the Units in the Initial Public Offering were issued with other freestanding
instruments (i.e., Public Warrants and Public Rights) and as such, the initial carrying value of Public Shares classified as temporary
equity are the allocated proceeds determined in accordance with ASC 470-20. The Company recognizes changes in redemption value immediately
as it occurs and will adjust the carrying value of redeemable shares to equal the redemption value at the end of each reporting period.
Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption
amount value. The change in the carrying value of redeemable shares will result in charges against additional paid-in capital (to the
extent available) and accumulated deficit. Accordingly, at September 30, 2025 and December 31, 2024, common stock subject to possible
redemption is presented at redemption value as temporary equity, outside of the stockholders’ deficit section of the