Company: CDAQF
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001641172-25-000421
Chunk: 611

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 2
Chunk 611
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otment Option (including
6,666,667 Public Warrants and 4,666,667 Private Placement Warrants at the time of Initial Public Offering, and additional 413,496 Public
Warrants and 165,398 Private Placement Warrants at the time of the partial exercise of the Over-Allotment Option) in accordance with
the guidance contained in ASC 815-40. Such guidance provides that because the Warrants do not meet the criteria for equity treatment
thereunder, each Warrant was recorded as a liability. Accordingly, the Company has classified each Warrant as a liability at its fair
value. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement, the Warrant liability will
be adjusted to fair value, with the change in fair value recognized in the Company’s statements of operations.

Public
Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants.
The Public Warrants will become exercisable 30 days after the consummation of a Business Combination. The Public Warrants will expire
five years from the consummation of a Business Combination or earlier upon redemption or liquidation.

The
Company will not be obligated to deliver any Class A Ordinary Shares pursuant to the exercise of a Public Warrant and will have no obligation
to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the Class A
Ordinary Shares issuable upon exercise of the Public Warrants is then effective and a prospectus relating thereto is current, subject
to the Company satisfying its obligations with respect to registration. No Public Warrant will be exercisable for cash or on a cashless
basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their Public Warrants, unless the issuance
of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption
from registration is available.

The
Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination,
it will use its commercially reasonable efforts to file with the SEC a post-effective amendment to the IPO Registration Statement or
a new registration statement covering the registration, under the Securities Act of the Class A Ordinary Shares issuable upon exercise
of the Public Warrants. The Company will use its commercially reasonable efforts to cause such registration