Company: CDAQF
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001641172-25-023544
Chunk: 88

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 8
Chunk 88
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ITED CONDENSED FINANCIAL STATEMENTS

JUNE
30, 2025

Liquidity
and Going Concern

As
of June 30, 2025, the Company had $1,521 in its operating bank accounts and a working capital deficit of $2,699,343.

To
date, the Company’s liquidity needs have been satisfied through (i) a payment of $25,000 from the Legacy Sponsor to cover certain
expenses on behalf of the Company in exchange for the issuance of the Founder Shares, (ii) a loan of approximately $195,000 from the
Legacy Sponsor pursuant to a promissory note for up to $250,000 (the “IPO Promissory Note”), (iii) the net proceeds from
the consummation of the Private Placement not held in the Trust Account, (iv) the Polar Capital Investment (as defined in Note 5), and
(v) the Working Capital Loans (as defined in Note 5) pursuant to the 2021 Promissory Note and the 2024 Promissory Note (each as defined
in Note 5). The Company fully repaid the IPO Promissory Note on October 19, 2021. No additional borrowing is available under the IPO
Promissory Note (see Note 5).

As
of June 30, 2025, the Company had drawn $1,250,000 from the Polar Capital Investment that was fair valued at $227,273, $125,000 outstanding
from the 2021 Working Capital Loans (as defined below) and $1,532,122 outstanding from the 2024 Working Capital Loan (see Note 5).

Based
on the foregoing, Management believes that the Company may not have sufficient working capital to meet its anticipated obligations through
the earlier of the consummation of an initial Business Combination or one year from the date of the accompanying unaudited condensed
financial statements. Over this period, the Company will be using these funds for paying existing accounts payable, operating costs,
and completing our Business Combination.

In
connection with the Company’s assessment of going concern considerations in accordance with FASB ASC Subtopic 205-40 “Presentation
of Financial Statements – Going Concern,” the Company has until April 20, 2026 to consummate a Business Combination. It is
uncertain that the Company will be able to consummate a Business Combination by this time and the Company lacks the financial resources
it needs