Company: CDAQF
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001641172-25-010268
Chunk: 155

Company: Compass Digital Acquisition Corp.
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 2
Chunk 155
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 utilize up to $50,000 of funds from the accrued interest of the Trust Account to pay any dissolution expenses if
it does not effect a Business Combination prior to the end of the Combination Period.

We
estimated the aggregate fair value of these 742,490 Founder Shares pursuant to the 2024 Non-Redemption Agreements at $4,139,382 and $4,028,0080,
or approximately $5.58 and $5.43 per share on a weighted-average basis as of March 31, 2025 and December 31, 2024, respectively. This
estimate considers factors such as the probability of consummation of the Business Combination, estimated concessions, and the cost of
carrying charges to mitigate the investors’ exposure to fluctuations in the price of the Founder Shares. The fair value of these
Founder Shares was determined to be an expense in accordance with SAB 5T and classified as a liability due to the variability in the
number of Founder Shares to be transferred, depending on the timing of the Business Combination.

Critical
Accounting Estimates

This
section is based on our unaudited condensed financial statements and notes thereto contained elsewhere in this Report, which have been
prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect
the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our financial
statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to fair value of financial instruments
and accrued expenses. We base our estimates on historical experience, known trends and events and various other factors that we believe
to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets
and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions
or conditions.

Emerging
Growth Company

We
are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we may
take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging
growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation
requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic
reports and proxy statements, and exemptions