Company: CDAQF
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001641172-25-010268
Chunk: 11

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 1
Chunk 11
---
 will be less than the Initial Public Offering
price per Unit of $10.00.

    6

COMPASS DIGITAL ACQUISITION CORP.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2025

The Sponsors have agreed
that they will be liable to the Company if and to the extent any claims by a third party (other than the independent registered public
accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has entered
into a written letter of intent, confidentiality or similar agreement or Business Combination agreement, reduce the amount of funds in
the Trust Account to below the lesser of (i) $10.00 per Public Share and (ii) the actual amount per Public Share held in the Trust Account
as of the day of liquidation of the Trust Account, if less than $10.00 per share due to reductions in the value of the Trust Account assets,
less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed
a waiver of any and all rights to monies held in the Trust Account (whether or not such waiver is enforceable) nor will it apply to any
claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities
under the Securities Act of 1933, as amended (the “Securities Act”). However, the Company has not asked the Sponsors to reserve
for such indemnification obligations, nor has the Company independently verified whether the Sponsors have sufficient funds to satisfy
their indemnity obligations and believe that the Sponsors’ only assets are securities of the Company. Therefore, the Company cannot
assure its shareholders that the Sponsors would be able to satisfy those obligations. None of the Company’s officers or directors
will indemnify the Company for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
The Company seeks to reduce the possibility that the Sponsors will have to indemnify the Trust Account due to claims of creditors by endeavoring
to have all vendors, service providers, prospective target businesses or other entities, with which the Company does business, execute
agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

Sponsor Handover

On August 30, 2023, the Legacy Sponsor and