Company: CDT
Filing Date: 2025-04-25
Form Type: DEF 14A
Source: 0001641172-25-006259
Chunk: 22

Company: CDT Equity Inc.
Filing Date: 2025-04-25
Form: DEF 14A
Chunk 22
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The proposed Reverse Stock Split is intended to
qualify as a “reorganization” under Section 368 of the Code that is treated as a “recapitalization” for U.S. federal
income tax purposes. Assuming the Reverse Stock Split qualifies as a reorganization, except as described below with respect to cash received
in lieu of fractional shares (which fractional share is generally treated as received and then exchanged for cash), a U.S. holder of Common
Stock generally should not recognize gain or loss upon the proposed Reverse Stock Split. Accordingly, the aggregate tax basis of the U.S.
holder in the shares of Common Stock received in the Reverse Stock Split, including any fractional share treated as received and then
exchanged for cash, should equal the U.S. holder’s aggregate tax basis in the shares of Common Stock that such U.S. holder owned
immediately prior to the Reverse Stock Split. In addition, a U.S. holder’s holding period in the shares of Common Stock received
should include the holding period in the shares of Common Stock surrendered in the Reverse Stock Split. Treasury Regulations provide detailed
rules for allocating the tax basis and holding period of the shares of Common Stock surrendered to the shares of Common Stock received
in a recapitalization pursuant to the Reverse Stock Split. Holders of shares of the Common Stock acquired on different dates and at different
prices should consult their tax advisors regarding the allocation of the tax basis and holding period of such shares.

Generally, a U.S. holder who receives cash in
lieu of a fractional share of the Common Stock pursuant to the proposed Reverse Stock Split should be treated for U.S. federal income
tax purposes as having received a fractional share pursuant to the Reverse Stock Split and then as having received cash in exchange for
the fractional share and should generally recognize capital gain or loss in an amount equal to the difference between the amount of cash
received and the portion of the U.S. holder’s tax basis that is allocable to such fractional share of the Common Stock. Such capital
gain or loss generally will be long-term capital gain or loss if the U.S. holder’s holding period in the fractional share is more
than one year as of the effective date of the proposed Reverse Stock Split. The deductibility of capital losses is subject to limitations.
Special rules under Section 302 of the Code may apply to cause all or a portion of the cash received in lieu of a fractional share to
be treated as a distribution under Section 301 of the Code (rather than