Company: CDAQF
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001641172-25-000421
Chunk: 710

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 3
Chunk 710
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sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits,
if any, as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December
31, 2024 and 2023. The Company is currently not aware of any issues under review that could result in significant payments, accruals
or material deviation from its position.

The
Company is considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently
not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. Therefore, the Company’s
tax provision was zero for the period presented.

Offering
Costs Associated with the Initial Public Offering

Offering
costs consisted of legal, accounting, underwriting fees and other costs incurred through the accompanying balance sheet dates that are
directly related to the Initial Public Offering. Upon the completion of the Initial Public Offering, the offering costs were allocated
using the relative fair values of the Class A Ordinary Shares and Warrants. The costs allocated to Warrants were recognized in other
expenses, and those related to the Class A Ordinary Shares were charged against the carrying value of Class A Ordinary Shares. The Company
complies with the requirements of the FASB ASC Topic 340-10-S99-1, “Other Assets and Deferred Costs.”

    F-13

COMPASS
DIGITAL ACQUISITION CORP.

NOTES
TO FINANCIAL STATEMENTS

Net
(Loss) Income Per Ordinary Share

The
Company complies with the accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company
has two classes of Ordinary Shares Class A Ordinary Shares and Class B Ordinary Shares. Income is shared pro rata between the two classes
of Ordinary Shares. Net (loss) income per Ordinary Share is calculated by dividing the net (loss) income by the weighted average of Ordinary
Shares outstanding for the respective period. As of December 31, 2024 and 2023, the inclusion of financial instruments in the calculation
of earnings per share is contingent on a future event. As a result, diluted net (loss) income per Ordinary Share is the same as basic
net (loss) income per Ordinary Share for the years presented. Accretion associated with the redeemable Class A Ordinary Shares is excluded
from earnings per share as the redemption value approximates fair