Company: CDT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010405
Chunk: 143

Company: CDT Equity Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 2
Chunk 143
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 prepaid
expenses.

Cash
Flows (Used) Provided by Investing Activities

Net
cash used in investing activities for the three months ended March 31, 2025 was $4,000, resulting from purchases of property, plant
and equipment of $4,000.

There
was no cash flow from investing activities for the three months ended March 31, 2024.

Cash
Flows Provided by Financing Activities

Net
cash provided by financing activities for the three months ended March 31, 2025 was $5.9 million, resulting from proceeds from the issuance
of common shares related to the ATM program of $8.1 million. This was offset by repayments of notes payable of $0.6 million, repayments
of convertible notes payable – related parties of $0.9 million and repayment of convertible notes payable of $0.6 million.

There
was no cash flow from financing activities for the three months ended March 31, 2024.

Contractual
Obligations and Other Commitments

Laboratory
Lease

We are the lessee under a
laboratory space lease. The annual rent payments are $0.1 million for the years ending December 31, 2025 and December 31, 2026. The laboratory
space lease has a remaining lease term of approximately two years.

34

Critical
Accounting Estimates

The
preparation of financial statements in conformity with U.S. GAAP requires us to make estimates, judgments and assumptions that affect
the amounts reported in the Consolidated Financial Statements. These estimates, judgments and assumptions are evaluated on an ongoing
basis. We base our estimates on historical experience and on various other assumptions that we believe are reasonable at that time, 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 materially from those estimates. The accounting policies that reflect our more significant
estimates, judgments and assumptions and which we believe are the most critical to aid in fully understanding and evaluating our reported
financial results include the following:

Fair
Value of Convertible Notes

The
Company has elected the fair value measurement option for convertible debt with embedded derivatives that would otherwise require bifurcation,
and has recorded the entire hybrid financial instrument at fair value under the guidance in ASC 825, Financial Instruments. To value
the convertible debt, the Company utilizes Binomial Lattice Pricing Models. The Binomial L