Company: CDT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010405
Chunk: 84

Company: CDT Equity Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 84
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 other current liabilities 
    $1,045  
    $1,963 

    12

4.
Convertible Notes Payable

Convertible
Promissory Notes Payable

During
March 2023, the Company issued a convertible promissory note payable (the “Convertible Promissory Notes Payable”) with an
aggregate principal amount of $0.8 million to a non-related third party. The Convertible Promissory Note Payable had a maturity date
of 18 months from the date of issuance. The note carries interest at a rate of 20% annually, which is payable every six (6) months from
the date of the note until the maturity date.

On
March 6, 2025, the Company reached a Settlement Agreement (the “Settlement Agreement”) with the loan holder to pay $0.7 million
in order to settle the March 2023 Convertible Note in full. The Company repaid the loan holder the settlement amount of $0.7 million on
March 13, 2025. The Settlement Agreement and subsequent repayment was treated as a debt extinguishment under ASC 470-50. During
the three months ended March 31, 2025, the Company recorded a gain on debt extinguishment of $0.1 million, calculated as the difference
between (i) the $0.8 million carrying value of the Convertible Promissory Note Payable immediately prior to the amendment (ii) the $0.7
million repayment of the March 2023 Convertible Note. The $0.1 million gain on debt extinguishment was recorded within other income (expense)
in the condensed consolidated statement of operations and comprehensive loss for the three months ended March 31, 2025.

In
connection with the Settlement Agreement, the Company entered into a consulting agreement with a third party to negotiate the settlement
of the convertible note with the loan holder on behalf of the Company. In exchange for negotiating the Settlement Agreement, the Company
agreed to pay $0.1 million through the issuance of shares of Common Stock or cash. On March 31, 2025, the Company issued 73,074 shares of Common Stock. The number of shares issued was determined based on the agreement amount of $0.1
million, divided by the closing share price on March 28, 2025 (prior trading date) of $0.89. The $0.1 million was recorded as interest expense in the