Company: CDT
Filing Date: 2025-04-22
Form Type: S-3
Source: 0001641172-25-005732
Chunk: 11

Company: CDT Equity Inc.
Filing Date: 2025-04-22
Form: S-3
Chunk 11
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 statements or comply with applicable regulations could be adversely affected. We may identify additional material weaknesses in our internal controls over financing reporting which we may not be able to remedy in a timely manner.

In connection with the preparation and audit of the financial statements as of and for the fiscal years ended December 31, 2024 and 2023, material weaknesses were identified in our internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis. These material weaknesses primarily relate to the following matters that are relevant to the preparation of our financial statements:

| ● | We                                                                                                                                           
 have limited segregation of duties. For the periods under audit, the Company did not have any internal personnel in the financial            
 accounting and reporting department, instead relied upon third party consultants to perform these activities.                                |
| ● | We                                                                                                                                           
 lack a formal process for review and approval of financial statements. For the periods under audit, especially prior to the business         
 combination, numerous, recurring errors in account balances and disclosures were detected in the financial statements that resulted          
 in a reasonable possibility that a material misstatement would not have been detected on a timely basis.                                     |
| ● | We                                                                                                                                           
 did not design adequate and appropriate internal controls, including monitoring controls, to review and evaluate the accounting implications 
 of all material transactions that occurred in the audit period.                                                                              |

If these material weaknesses are not remediated, it could result in a misstatement of account balances or disclosures that would result in a material misstatement to the annual or interim financial statements that would not be prevented or detected. We are reviewing measures designed to improve our internal control over financial reporting to remediate these material weaknesses, although they have not been fully remediated as of the date of this filing. As a part of these measures, we also expect to engage an external advisor to assist with evaluating and documenting the design and operating effectiveness of internal controls and assisting with the remediation of deficiencies when funding and additional liquidity becomes available, as necessary. The primary costs associated with such measures are corresponding recruiting and additional salary and consulting costs, which are difficult to estimate but which may be significant. These additional resources and procedures are intended to enable us to broaden the scope and quality of our internal review of underlying information related to financial reporting and to formalize and enhance our internal control procedures.

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The material weaknesses will