Company: CDAQF
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0001641172-25-000421
Chunk: 420

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 1C
Chunk 420
---
ii) the 2024 Extension Amendment Proposal was approved.

In
connection with our entry into the 2024 Non-Redemption Agreements, we also agreed that, in the event of the liquidation of the Trust
Account, we will only utilize up to $50,000 of funds from the accrued interest of the Trust Account to pay any dissolution expenses if
we do not effect a Business Combination prior to the end of the Combination Period.

We
estimated the aggregate fair value of these 742,490 Founder Shares pursuant to the 2024 Non-Redemption Agreements at $4,028,0080, or
approximately $5.492543 per share on a weighted-average basis as of December 31, 2024. 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 in the number of Founder Shares to be transferred, depending
on the timing of the Business Combination.

Critical
Accounting Estimates

This
Item of the Report is based on our financial statements and notes thereto contained elsewhere in this Report, which have been prepared
in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial statements.
On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments and accrued
expenses. We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable
under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

36

Emerging
Growth Company

We
are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we may
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging
growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation