What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2026-03-10 compared with 2025-03-05 · 116 added, 119 removed, 205 unchanged (53% of the section changed)

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Our AC products include both powdered activated carbon ("PAC") and granular activated carbon ("GAC"), among others.

Additionally, we own the Five Forks Mine, a lignite coal mine that currently supplies the primary raw material for the manufacturing of our products.

Additionally, we own the Five Forks Mine, a lignite coal mine that currently supplies the primary raw material for the manufacturing of the majority of our products.

Our predecessor, ADA-ES, Inc.

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In 2018, we acquired ADA Carbon Solutions, LLC to expand our product offerings in the mercury control industry and enter into other applicable APT markets.

In February 2023, we acquired 100% of the equity interests, assets and liabilities of the subsidiaries of Arq Limited, an environmental technology company incorporated under the laws of Jersey (the "Arq Acquisition" or the "Transaction," and hereafter the Arq Limited subsidiaries referred to as "Legacy Arq") to secure access to additional U.S.

based bituminous coal feedstock, a manufacturing facility located in Corbin, Kentucky (the "Corbin Facility") and certain patented processes to manufacture new advanced GAC products for sale into the APT and other markets.

In February 2023, we acquired 100% of the equity interests, assets and liabilities of the subsidiaries of Arq Limited, an environmental technology company incorporated under the laws of Jersey (the "Arq Acquisition" and hereafter the Arq Limited subsidiaries referred to as "Legacy Arq") to secure access to additional U.S.

based bituminous coal feedstock and a manufacturing facility located in Corbin, Kentucky (the "Corbin Facility").

In February 2024, as part of a larger rebranding, the Company changed its name to Arq, Inc., and on February 1, 2024, our common stock commenced trading on the Nasdaq Global Market under the ticker symbol, "ARQ."

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Additionally, we believe enhanced environmental and health advisory issues will continue to drive demand for AC in rapidly developing countries.

We continuously pursue opportunities to expand and diversify our customer base into markets for our purification products including industrial applications, water treatment plants and other end markets.

We continuously pursue opportunities to expand and diversify our customer base in new and existing markets for our purification products including industrial applications, water treatment plants and other end markets.

In addition, we see significant opportunities emerging in the soil, sediment and groundwater treatment markets.

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Our current products (also referred to as "consumables") are used to purify contaminated liquid, soil, and gas streams from a variety of industrial sources including wastewater treatment plants, coal-fired power plants and other end markets.

Most of the North American coal-fired power generators and other industrial customers installed equipment to control air pollutants, such as

mercury, prior to or since the implementation of the Mercury and Air Toxics Standards ("MATS") by the U.S.

Most of the North American coal-fired power generators and other industrial customers installed equipment to control air pollutants, such as mercury, prior to or since the implementation of the Mercury and Air Toxics Standards ("MATS") by the U.S.

Environmental Protection Agency ("EPA").

However, many power generators need consumable products to complement the operation of installed equipment on a recurring basis to more effectively capture mercury and other contaminants.

AC has been adopted as the most widely used technology to capture mercury due to product efficiency and effectiveness, and currently accounts for the majority of the mercury control consumables in the North American market.

We offer AC and other chemical products and work with customers as they develop and implement a compliance control strategy that utilizes the consumables solutions that fit their unique operating and pollution control configuration.

However, many power generators need consumable products to complement the operation of

installed equipment on a recurring basis to more effectively capture mercury and other contaminants.

AC is the most widely used technology to capture mercury due to product efficiency and effectiveness, and currently accounts for the majority of the mercury control consumables utilized in the North American market.

In addition to offering AC and other chemical products, we work with customers as they develop and implement a compliance control strategy that utilizes our consumables solutions and that fits their unique operating and pollution control configuration.

Coal-fired power plants continue to be a significant, though declining, source of electricity generation in the United States ("U.S.").

Demand for our AC products related to coal-fired electricity generation is highly dependent on the availability and cost of alternative energy sources, such as natural gas, solar and wind energy.

It remains unclear whether the EPA's February 12, 2026 decision to repeal the "endangerment finding" as it relates to the regulation of greenhouse gases will impact or reverse this trend.

Regardless, demand for our AC products related to coal-fired electricity generation is highly dependent on the availability and cost of alternative energy sources, such as natural gas, solar and wind energy.

We continue to pursue markets for our purification products outside of coal-fired power generation, including industrial applications, (such as waste-to-energy and cement making), water treatment and other markets.

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Groundwater contamination has become a matter of increasing concern to federal and state governments as well as to the public, especially over recent years.

AC market may see significant growth from water purification markets, especially as implementation dates for new regulations issued by the EPA in April 2024 are nearing, with full compliance currently required by April 2029.

In addition, certain states and certain municipal water treatment systems across the U.S.

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Approval processes can vary in length from a number of days to multiple months.

We have commenced the pre-approval process with a number of relevant state and municipal agencies.

Please note, U.S.

We are in initial and advanced stages of testing with a number of relevant state and municipal agencies with promising results to date.

regulations are subject to continuing change, as further discussed in "Legislation and Environmental Regulations" included in Item 1 of this Report.

The existing technologies for treatment of groundwater, including removal of contaminated soil for external treatment or landfill, pumping groundwater above the surface for treatment and/or installing treatment trenches or barriers often utilize PAC and GAC products.

An emerging technology generating increasing interest by site engineering firms and owners is injecting highly engineered ACs into the subsoil, also described as "in situ" treatment, to intercept the contamination plume or to treat the groundwater.

In response to this market opportunity, in late 2021, we developed a new CCP platform, FluxSorb RC, which is a treatment option in certain contaminated soil and groundwater remediation treatment sites.

In late 2021, we developed a new CCP platform, FluxSorb RC, which is a treatment option in certain contaminated soil and groundwater remediation treatment sites.

Treatment with FluxSorb RC injects highly engineered ACs into the subsoil, also described as "in situ" treatment, to intercept the contamination plume or to treat the groundwater.

Legacy Arq Products and Markets

With the acquisition of Legacy Arq in February 2023, we now control reserves of high-quality recovered bituminous coal fines and own a manufacturing facility, both located in Corbin Kentucky (the "Corbin Facility").

Our facility remediates these reserves, using a patented manufacturing process to convert the recovered bituminous coal fines into a purified, microfine carbon powder known as Arq powder TM ("Arq Powder") for high value applications, such as for a raw material to produce GAC products.

We expect to begin using Arq Powder as a feedstock to produce high-quality GAC products by the end of the first quarter of 2025 for sale into the APT and other markets.

We anticipate that our GAC products made using these highly purified recovered bituminous coal fines will have a materially lower carbon footprint than other coal-based competitor alternatives.

We believe Arq Powder has additional potential to enable us to access new markets and applications.

We intend to secure customer interest in Arq Powder as an additive into other markets, such as components for asphalt.

These products utilizing Arq Powder are expected to have a lower carbon footprint compared to similar products utilizing conventional materials and have demonstrated other beneficial performance attributes during lab-scale customer testing.

Our facility remediates these reserves, using a patented manufacturing process to convert the recovered bituminous coal fines into a purified, microfine carbon powder ("Corbin Wetcake") for high value applications.

In August 2025, we began to use Corbin Wetcake to produce high-quality GAC products for sale into the APT and other markets.

However, due to factors described below, we have since ceased use of Corbin Wetcake in production of our GAC products and idled our Corbin Facility.

Business - Recent Developments" for further information.

We believe that Corbin Wetcake has the potential to supply new markets and applications.

We intend to secure customer interest in Corbin Wetcake as an additive into other markets, such as a component for asphalt, or for use in the purified coal and synthetic graphite industries.

In addition, we are exploring uses for certain rare earth minerals and critical elements that can be isolated during the manufacturing process at our Corbin Facility for use in a variety of applications.

These applications are currently in various stages of proof of concept testing or preliminary customer testing.

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Power generation is weather dependent, with electricity and steam production varying in response to heating and cooling demands.

As a result, our revenue is generally higher in our first and third fiscal quarters during the warmer and colder months of the year.

As a result, our revenue is generally

higher in our first and third fiscal quarters during the warmer and colder months of the year.

Abnormally high and low temperatures during the summer and winter months, respectively, may significantly increase coal consumption for electricity generation and cause increased impurities within various municipalities' water sources, and thus increase the demand for our products.

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During periods of low natural gas prices, natural gas provides a competitive alternative to coal-fired power generation and therefore, coal consumption for power generation may be reduced, which in turn reduces the demand for our products.

In contrast, during periods of higher prices for competing power generation sources, coal consumption generally increases and thus demand for our products also increases.

In water purification, the sale of our products depends on demand from municipal water treatment facilities that use these products.

Depending on weather conditions and other environmental factors, the summer months historically have the highest demand for our PAC products in water treatment.

One of the major uses for PAC is for the treatment of taste and odor impurities caused by increased degradation of organic contaminants and natural materials in water that occurs predominately during the summer months.

Additionally, the rainy season generally results in more demand for PAC products to water municipalities due to rain run-offs and contaminant dilution.

In contrast, during periods of higher prices for competing power generation sources, coal consumption generally increases, which generally increases demand for our products.

Demand for our water purification products is driven largely from municipal water treatment facilities.

Depending on weather conditions and other environmental factors, the summer months historically have the highest demand for our water treatment products.

One of the major uses for PAC is for the treatment of taste and odor impurities caused by organic contaminants and natural materials in water that predominantly degrade during the summer months.

Additionally, the rainy season generally results in more demand from water municipalities due to increased contaminated water volume from rain run-off.

Our primary competitors in the AC consumables industry include Norit Americas, Inc., which is owned by One Equity Partners, and Calgon Carbon, which is owned by Kuraray Co., Ltd.

In addition to our primary competitors, we compete with other, smaller producers and distributors.

We believe that our domestic supply chain, including access to our vertically integrated lignite feedstock for our PAC and other products, provides our Company with a competitive advantage over certain other market participants.

Sources and Availability of Raw Materials

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The Five Forks Mine is operated for us by a subsidiary of the North American Coal Company.

Through lignite coal production at the Five Forks Mine, we have a vertically integrated supply chain for our PAC products.

We may also periodically purchase various ACs to supplement our inventory levels or to produce various products to serve certain AC markets.

We purchase these various ACs through supply agreements or spot purchases with the producers.

With the acquisition of Legacy Arq in 2023, we secured a second feedstock, Arq Powder, which is made from high-quality recovered bituminous coal fines, for use in manufacturing of GAC products.

Through internal testing, we have demonstrated that Arq Powder can be shaped and successfully activated using industrially available equipment and technology with our proprietary know-how.

Arq Powder has unique properties, including low levels of impurities and small average particle size, which when used as a feedstock to produce certain carbon products may provide for advantages compared to lignite coal, other bituminous coals, or oil-based feedstocks in terms of cost and performance.

In the U.S., the availability of feedstock for GAC manufacturing is limited, as it is either supplied by specialty mined coal or coconut husks, which need to be imported.

Between the Corbin Facility and the Five Forks Mine, we have a fully integrated supply chain in multiple feedstocks - bituminous coal fines (Corbin Facility) and lignite coal (Five Forks Mine) to produce both GAC and PAC products.

With the acquisition of Legacy Arq in 2023, we secured a second feedstock at our Corbin Facility, which is made from high-quality recovered bituminous coal fines.

Through internal testing, we have demonstrated that our Corbin Wetcake can be shaped and successfully activated using industrially available equipment and technology with our proprietary know-how.

This feedstock has unique properties, including low levels of impurities and small average particle size, which when used to produce certain carbon products may provide for advantages compared to lignite coal, other bituminous coals, or oil-based feedstocks in terms of cost and performance.

We initially expected to use Corbin Wetcake in the production of GAC products;

however, due to previously disclosed design flaws in the GAC Facility at our Red River Plant (each as defined below), on a standalone basis as well as in combination with the inherent variability of Corbin Wetcake, we now expect to use bituminous proven performance coal feedstock from other sources to produce our GAC products.

Business - Recent Developments" for further information.

We purchase various additives utilized in the production of our AC products.

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We also operate a production and distribution facility located on land we lease in Coushatta.

In addition, we own and operate the Corbin Facility, where we process bituminous coal fines and apply patented technology to produce Arq Powder.

In addition, we own and operate the Corbin Facility, where we process bituminous coal fines and apply patented technology to produce Corbin Wetcake.

In January 2024, we executed a contract with a third-party contractor for the construction of a GAC facility at the Red River Plant (the "GAC Facility") and immediately commenced construction operations.

In September 2024, we terminated the contract with the third-party contractor and moved the construction and project management functions for the GAC Facility internally.

Mechanical completion of our GAC Facility was completed in January 2025.

We expect to commence initial production of our proprietary GAC product at the GAC Facility by the end of the first quarter of 2025.

For the year ended December 31, 2024, construction costs for the GAC Facility were approximately $80 million.

We completed commissioning at our Corbin Facility in January 2025.

Total construction and commissioning costs at the Corbin Facility were approximately $7 million for the year ended December 31, 2024.

Initial mechanical completion of our GAC Facility occurred in January 2025, and on August 6, 2025, we announced that we had successfully commissioned the GAC Facility and produced our first commercial volumes of on-specification GAC product, albeit at volumes below nameplate capacity.

However, after initial production runs, in December 2025, it became clear that ramp-up to nameplate capacity could not be accomplished without further modifications to the existing systems because of design flaws in our GAC Facility, on a standalone basis as well as in combination with the inherent variability of the Corbin Wetcake, which we planned to use to manufacture our GAC products.

As a result, we have paused GAC production, idled the Corbin Facility as a cost saving measure, and have launched an engineering and production process optimization review, which will include an evaluation of potential GAC Facility design modifications and production economics at different scales.

Additionally, we now expect to transition away from using Corbin Wetcake for the production of our GAC products to a bituminous proven performance coal feedstock, which we believe can more effectively overcome design constraints.

Business – Recent Developments” for further information.

Research and Development Activities

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Among the risks are costs associated with operating manufacturing plants and mining operations, fines and penalties if we are found to be in violation of laws and regulations (and/or our operating permits), as well as modifications, disruptions or discontinuation of certain operations.

Additionally, our products and services are used for the reduction of certain pollutants and other contaminants and legislation and regulations that limit the amount of pollutants and other contaminants permitted in air, water and soil may increase or decrease the need for our products.

Additionally, our products and services are used for the reduction of certain pollutants and other contaminants and legislation and regulations that limit the amounts of pollutants and other contaminants permitted in air, water and soil may increase or decrease the need for our products.

We regularly monitor and review our operations, procedures and policies for compliance with these and other laws and regulations.

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Federal National Primary Drinking Water Regulation and other PFAS Regulations

In October 2021, the EPA released its PFAS Strategic Roadmap, laying out its approach to addressing PFAS and other pollutants, which set a timeline by which the EPA planned to take certain actions through 2024, including establishing a national primary drinking water regulation for certain PFAS and taking Effluent Limitations Guidelines actions to regulate certain PFAS discharges from industrial categories.

In October 2021, the EPA released its PFAS Strategic Roadmap, laying out its approach to addressing PFAS and other pollutants, which set a timeline by which the EPA planned to take certain actions, including establishing a national primary drinking water regulation for certain PFAS and taking Effluent Limitations Guidelines actions to regulate certain PFAS discharges from industrial categories.

On March 14, 2023, the EPA proposed a National Primary Drinking Water Regulation ("NPDWR") for six specific PFAS substances.

On April 10, 2024, the EPA announced the final NPDWR, which established legally enforceable maximum contaminant levels ("MCL") for six PFAS substances, including a MCL for Perfluorooctane Acid ("PFOA") and Perfluorooctane Sulfonate ("PFOS") of 4.0 parts per trillion.

Under the NPDWR, drinking water utilities have three years from the publication of the final rule, or until April 2027, to comply with monitoring requirements and have five years from the publication of the final rule, or until April 2029, to implement solutions that reduce the applicable PFAS substances below the MCLs.

We anticipate that these new regulations will increase demand in the U.S.

On April 10, 2024, the EPA announced the final NPDWR, which established

legally enforceable maximum contaminant levels ("MCL") for six PFAS substances, including a MCL for perfluorooctanoic acid ("PFOA") and perfluorooctane sulfonic acid ("PFOS") of 4.0 parts per trillion.

However, in May 2025, the EPA announced that, along with extending the compliance deadline as described below, it intends to narrow the final rule to apply to only PFOA and PFOS, eliminating the other six PFAS substances from the final rule.

Under the NPDWR, drinking water utilities have three years from the publication of the final rule, or until April 2027, to comply with monitoring requirements and initially had five years from the publication of the final rule, or until April 2029, to implement solutions that reduce the applicable PFAS substances below the MCLs.

The EPA has since indicated that it will likely extend the compliance date from April 2029 to April 2031 through a rule making expected to commence in Spring of 2026.

We anticipate that these new regulations, regardless of effective date, will increase demand in the U.S.

for PFAS water treatment products and services, including our GAC products.

On May 8, 2024, the EPA finalized new regulations that treat PFOS and PFOA as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA").

The new rules allow the EPA to hold polluters financially responsible for contaminated sites and will also lead to these PFAS chemicals being listed as "hazardous materials" under the Hazardous Materials Transportation Act, which will require materials containing these chemicals to be transported using special protocols.

Although final rules have not been issued, in February 2024 the EPA proposed changes to the Resource Conservation and Recovery Act ("RCRA") regulations by adding nine PFAS chemical compounds to its list of hazardous constituents.

Combined with the new CERCLA regulations, a final RCRA regulation of PFAS may increase the costs of the handling, transport, and disposal of PFAS-containing materials including water treatment waste.

On May 8, 2024, the EPA finalized regulations that treat PFOS and PFOA as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA").

The rules, which became effective on July 8, 2024, allow the EPA to hold polluters financially responsible for contaminated sites and list these PFAS chemicals as "hazardous materials" under the Hazardous Materials Transportation Act, which require materials containing these chemicals to be transported using special protocols.

The final CERCLA rules have been the subject of ongoing litigation and on September 25, 2025, the EPA announced that it would continue to defend the final rule in court.

In February 2024 the EPA proposed rule changes to the Resource Conservation and Recovery Act ("RCRA") regulations by adding nine PFAS chemical compounds to its list of hazardous constituents, which rules are expected to be finalized in April 2026.

Combined with the new CERCLA regulations, a final RCRA regulation of PFAS may increase the costs of handling, transport, and disposal of PFAS-containing materials including water treatment waste.

Federal MATS Affecting Electric Utility Steam Generating Units

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The MATS Rule sets a limit that we believe requires the capture of 80-90% plus of the mercury in the coal burned in electric power generation boilers as measured at the exhaust stack outlet for most plants.

The MACT-based standards are also known as National Emission Standards for Hazardous Air Pollutants ("NESHAP").

The MACT-based standards are also known as National Emission Standards for Hazardous Air Pollutants.

Plants generally had four years to comply with the MATS Rule, and implementation of the MATS Rule is now largely completed.

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as of December 31, 2025.

On February 12, 2026, the EPA announced that it was repealing the "endangerment finding" that allowed it to regulate greenhouse gas emissions.

It is unclear whether such repeal will impact the number of coal-fired units in operation.

In May 2020, the EPA reconsidered and found that it was not "appropriate and necessary" to regulate Hazardous Air Pollutants ("HAPs") emissions from coal- and oil-fired EGUs.

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On February 15, 2023, the EPA issued a final rule revoking the May 2020 reconsideration and affirming that it is "appropriate and necessary" to regulate HAP emissions from coal- and oil-fired EGUs.

On April 3, 2023, the EPA issued a proposed update to MATS that, amongst other potential modifications, proposed a reduction to the mercury emission limits for lignite coal-fired EGUs.

On April 3, 2023, the EPA issued a proposed amendment to the MATS Rule that, among other potential modifications, proposed a reduction to the mercury emission limits for lignite coal-fired EGUs.

The EPA adopted the final rule on April 25, 2024.

However, on June 17, 2025, the EPA proposed to repeal three provisions of the 2024 amendment to the MATS Rule, including loosening requirements for particulate matter and mercury emissions to pre-2024 levels (including for lignite coal-fired EGUs), as well as provisions relating to emissions monitoring systems.

On February 19, 2026, the EPA followed through with its proposal and finalized the repeal of the 2024 MATS amendment, reverting required compliance standards back to the existing standards set in 2012.

State Mercury and Air Toxics Regulations Affecting EGUs

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For example, in Canada, the Canada-Wide Standard ("CWS") was initially implemented in 2010, with increasingly stringent limits through 2020 and varying mercury emissions caps for each province.

In May 2017, the EU ratified the Minimata Convention on Mercury, triggering mercury control regulations with implementation starting in 2021.

In May 2017, the EU ratified the Minamata Convention on Mercury, triggering mercury control regulations which were implemented starting in 2021.

Specific emissions limits for dust, nitrogen oxides (NOx), sulfur dioxide (SO 2 ), mercury and particulate matter (PM) are currently being developed, guided by the best available technologies reference ("BREF") document for limiting stack emissions and liquid effluents from industrial processes.

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In October 2022, the European Commission proposed new directives for better and more cost-effective treatment of urban wastewater, which included among other things new standards on micropollutants and new monitoring requirements for microplastics.

In January 2024, there was a provisional agreement that revised the October 2022 proposed directives.

The revised directive was adopted by the European Parliament and the Council on November 5, 2024, and is enforceable on European Union Member States, subject to the revised directive’s implementation period, which requires European Union Member State compliance by mid-2027.

In January 2024, there was a provisional agreement that revised the October 2022 proposed directives to focus on challenges such as the presence of micropollutants in urban wastewater.

The revised directive was adopted by the European Parliament and the Council on November 5, 2024, went into force on January 1, 2025, and is enforceable on European Union Member States, subject to the revised directive’s implementation period, which requires European Union Member State compliance by mid-2027, with some exceptions.

Mining Environmental and Reclamation Matters

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patents and 16 international patents that were issued or allowed, 17 additional U.S.

provisional patents or applications that were pending, and 36 international patent applications that were either pending or filed relating to different aspects of our technology.

provisional patents or applications that were pending, and 36 international patent applications that were either pending or filed

relating to different aspects of our technology.

During the year ended December 31, 2025, we were granted 4 new patents.

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Learning, Development and Employee Engagement

We offer a range of skills-based and compliance training programs, including environmental courses on topics including hazardous waste, water treatment, and environmental awareness, and a large number of safety courses.

These programs are owned and organized by each department and are focused on the development requirements of the specific roles held by our employees.

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Recent Developments

GAC Engineering and Production Process Optimization Review

As previously disclosed, on August 6, 2025, we announced that we had successfully commissioned our GAC Facility and produced our first commercial volumes of on-specification GAC product.

This decision follows independent testing results received in January 2026 demonstrating that our current thermal oxidizer can only support approximately 15 million pounds of annual GAC production, but will require additional modifications to achieve our original design capacity of 25 million pounds or

Our analysis indicates that a 15 million pound per year scenario on a stand-alone basis does not provide sufficient returns to make it economically attractive.

The optimization review is expected to determine production scale, capital requirements, and return profiles before we commit to additional investment in our GAC Facility.

These constraints emerged as we prepared to transition from our Corbin Wetcake to bituminous proven performance coal, a solution which is expected to address previously announced design and feedstock variability challenges.

The current issues that we are experiencing with our thermal oxidizer and their impact on the capacity of our GAC Facility stem from the previously disclosed design flaws by the firm originally engaged to design our GAC Facility, with whom litigation remains ongoing.

Due to the issues described above, we do not expect material GAC revenue in fiscal year 2026.

Revolving Credit Facility

On December 27, 2024 (the "Closing Date"), we and certain of our subsidiaries entered into a Credit, Security and Guaranty Agreement (the "Revolving Credit Agreement") with MidCap Funding IV Trust, in its capacity as agent, the lenders from time to time party thereto, and any entities that become party thereto as Guarantors.

The Revolving Credit Agreement provides for a secured revolving credit facility (the "Revolving Credit Facility") under which we may borrow up to $30,000,000 at any one time, the availability of which is determined based on a borrowing base equal to percentages of certain eligible accounts receivable and inventory carrying balances, less applicable reserves established under the Revolving Credit Agreement, in accordance with a formula set forth in the Revolving Credit Agreement.

The Revolving Credit Facility has a maturity date of December 27, 2029.

Borrowings under the Revolving Credit Agreement bear interest at the Standard Overnight Financing Rate ("SOFR") plus an applicable margin of 4.50% per annum, subject to a SOFR floor of 2.50% per annum.

September 2024 Equity Offering

On September 20, 2024, we entered into an underwriting agreement (the "Underwriting Agreement") with Canaccord Genuity LLC, as the representative of the underwriters named therein (the "Underwriters"), relating to the issuance and sale (the "Offering") of 4,770,000 shares (the "Firm Shares") of the Company's common stock, par value $0.001 per share, at a price to the public of $5.25 per share.

Under the terms of the Underwriting Agreement, the Underwriters agreed to purchase the Firm Shares from the Company at a price of $4.935 per share.

We also granted the Underwriters an option exercisable for 30 days from the date of the Underwriting Agreement to purchase up to an additional 715,500 shares of common stock, on the same terms and conditions (the "Option Shares," and, together with the Firm Shares, the "Offered Shares"), which was subsequently exercised by the Underwriters.

Net proceeds from the Offering were approximately $26.7 million, after deducting underwriting discounts and commissions and estimated offering expenses.

The Firm Shares and Option Shares were offered and sold pursuant to a prospectus supplement dated September 20, 2024 and an accompanying base prospectus that form a part of our registration statement on Form S-3 (File No.

333-281762) filed with the SEC on August 23, 2024, which became effective on September 4, 2024.

May 2024 Private Placement

On May 15, 2024, we entered into a securities purchase agreement with certain accredited investors for the private placement of an aggregate of 2,142,858 shares of common stock, at a purchase price of $7.00 per share (the "Private Placement").

The aggregate gross proceeds for the Private Placement were approximately $15 million, before deducting offering expenses, and the Private Placement closed on May 16, 2024.

The Private Placement was exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act") pursuant to the exemption for transactions by an issuer not involving

any public offering under Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D of the Securities Act and in reliance on similar exemptions under applicable state laws.

Arq Acquisition

On February 1, 2023 (the "Acquisition Date"), we entered into a Securities Purchase Agreement (the "Purchase Agreement") with Arq Ltd., pursuant to which we acquired all of the direct and indirect equity interests, assets and liabilities of Legacy Arq in exchange for consideration (the "Purchase Consideration") totaling $31.2 million and consisting of (i) 3,814,864 shares of our common stock, valued at $12.4 million and (ii) 5,294,462 shares of our Series A Convertible Preferred Stock, par value $0.001 per share (the "Series A Preferred Stock"), valued at $18.8 million.

On June 13, 2023, our stockholders approved the conversion of all of the outstanding shares of the Series A Preferred Stock and the corresponding issuance of 5,362,926 shares of common stock.

PIPE Investment and Loan Agreement

On February 1, 2023, and in connection with the Arq Acquisition, we entered into subscription agreements with certain persons (the "Subscribers"), which included existing shareholders of Arq Ltd., three of which were appointed to our board of directors (the "Board"), pursuant to which the Subscribers subscribed for and purchased 3,842,315 shares of common stock for an aggregate purchase price of approximately $15.4 million and at a price per share of $4.00 (the "PIPE Investment").

The securities issued to the Subscribers under the Subscription Agreements were issued pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act, Rule 506 of Regulation D, which is promulgated thereunder, and Regulations S of the Securities Act.

The Company and its affiliates relied on this exemption from registration based in part on representations made by each of the Subscribers under the Subscription Agreements.

Pursuant to the terms of the Purchase Agreement, we entered into a Registration Rights Agreement (the "Registration Rights Agreement") with Arq Ltd.

and the Subscribers to the Subscription Agreements described above.

On January 25, 2024, we filed a registration statement on Form S-3/A with the Securities and Exchange Commission ("SEC") to register all shares of common stock issued in the Purchase Agreement, all shares of common stock issued in the PIPE Investments, and all shares of common stock issued from the conversion of all shares of the Series A Preferred Stock subject to the Registration Rights Agreement and 325,457 underlying shares of common stock issuable upon the exercise of the Warrant (as defined below) issued as consideration in the CFG Loan (as defined below).

The registration was declared effective by the SEC on January 31, 2024.

Also on February 1, 2023, and in connection with the Arq Acquisition, we, as borrower, certain of our subsidiaries, as guarantors, and CF Global Credit, as administrative agent and lender, entered into a $10.0 million term loan (the "CFG Loan") upon execution of a Term Loan and Security Agreement (the "Loan Agreement").

The CFG Loan had a term of 48 months and bore interest at a rate equal to either (a) Adjusted Term SOFR (subject to a 1.00% floor and a 2.00% cap) plus a margin of 9.00% paid in cash and 5.00% paid in kind or (b) Base Rate plus a margin of 8.00% paid in cash and 5.00% paid in kind, which interest on the CFG Loan in each case was payable (or capitalized, in the case of in kind interest) quarterly in arrears.

On December 27, 2024, in connection with the Closing of the Revolving Credit Facility described above, we repaid in full all amounts outstanding and due under the CFG Loan and terminated the Loan Agreement.

In addition, in connection with the Loan Agreement and as consideration for the CFG Loan, we issued to CF Global a warrant (the "Warrant") to purchase 325,457 shares of common stock.

The Warrant had an exercise price of $0.01 per share, subject to adjustment as set forth in the Warrant, was exercisable immediately, contained a cashless exercise provision and was set to expire on February 1, 2030.

On March 29, 2024, the Warrant was exercised in full.

Under the Credit, Security and Guaranty Agreement (the "Revolving Credit Agreement"), between us, certain of our subsidiaries, and MidCap Funding IV Trust, we maintain a secured revolving credit facility (the "Revolving Credit Facility"), under which we may borrow up to $30,000,000 at any one time, the availability of which is determined based on a borrowing base calculated in accordance with a formula set forth in the Revolving Credit Agreement.

On May 6, 2025, December 9, 2025, January 28, 2026, and February 27, 2026, we entered into the first amendment, the second amendment, the third amendment, and the fourth amendment to the Revolving Credit Agreement, respectively (together, the “Amendments”).

In each case, the Amendments amended, among other things, the borrowing availability calculation included in the Revolving Credit Agreement and updated the minimum liquidity covenant, providing for decreased minimum liquidity requirements for certain defined time periods during 2025 and into 2026.

Available Information

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This Report contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act that involve risks and uncertainties.

In particular statements about our beliefs, plans, objectives, expectations, assumptions, future events or future performance contained in this report, including certain statements found in this Part I and

under the heading in Part II, Item 7 below, are forward-looking statements.

In particular, statements about our beliefs, plans, objectives, expectations, assumptions, future events or future performance contained in this report, including certain statements found in this Part I and under the heading in Part II, Item 7 below, are forward-looking statements.

In some cases, forward-looking statements can be identified by words or phrases such as "anticipates," "believes," "expects," "intends," "plans," "estimates,", "may," "predicts," the negative expressions of such words, or similar expressions, and such forward-looking statements include, but are not limited to, statements or expectations regarding:

(a) the anticipating timing of the completion of commissioning of the GAC Facility, ramp-up to full nameplate capacity at our Red River Plant, and commercial production of our GAC products;

(b) the anticipated effects from fluctuations in the pricing of our AC products;

(d) the seasonal impact on our customers and their demand for our products;

(e) the ability to continue to successfully integrate Legacy Arq's business and recognize the benefits and synergies from the Arq Acquisition;

(f) the ability to continue to develop and utilize Legacy Arq’s products and technology and the anticipated timing for bringing such products to market;

(g) our ability to access new markets for our GAC and other products;

(h) any future plant capacity expansions or site development projects and our ability to finance any such projects;

(i) the effectiveness of our technologies and the benefits they provide;

(j) the timing of awards of, and work and related testing under, our contracts and agreements and their value;

(k) probability of any loss occurring with respect to certain guarantees made by Tinuum Group;

(l) the timing and amounts of or changes in future revenue, funding for our business and projects, margins, expenses, earnings, tax rates, cash flows, royalty payment obligations, working capital, liquidity and other financial and accounting measures;

(m) the performance of obligations secured by our surety bonds;

(n) the amount and timing of future capital expenditures needed to fund our business plan;

(o) the impact of capital expenditure overruns on our business;

(p) awards of patents designed to protect our proprietary technologies both in the U.S.

and other countries;

(q) the adoption and scope of regulations to control certain chemicals in drinking water and other environmental concerns and the impact of such regulations on our customers' and our businesses, including any increase or decrease in sales of our AC products resulting from such regulations;

(r) the impact of adverse global macroeconomic conditions, including rising interest rates, recession fears and inflationary pressures, and geopolitical events or conflicts;

(s) opportunities to effectively provide solutions to our current and future customers to comply with regulations, improve efficiency, lower costs and maintain reliability;

(t) the impact of prices of competing power generation sources such as natural gas and renewable energy on demand for our products.

(a) the future of our GAC Facility and Corbin Facility and the anticipated timing, results, and conclusions of our GAC business optimization review and the actions we may take upon the completion of such review;

(b) the anticipated benefits of transitioning away from using Corbin Wetcake to a bituminous proven performance coal as a feedstock for our GAC products;

(d) the anticipated effects from fluctuations in the pricing of our AC products;

(e) expected supply and demand for our AC products and services, including our GAC products;

(f) the seasonal impact on our customers and their demand for our products;

(g) the future profitability and sustainability of our PAC business;

(h) our ability to fund our business over the next twelve months;

(i) our ability to access new markets for our feedstocks and other products, including renewable natural gas, asphalt, purified coal, rare earth minerals and synthetic graphite markets;

(j) any future plant development projects, including those that may be necessary to remediate design flaws in our GAC Facility, and our ability to finance any such projects;

(k) the effectiveness of our technologies and the benefits and competitive advantages they provide;

(l) the timing of awards of, and work and related testing under, our contracts and agreements and their value;

(m) probability of any loss occurring with respect to certain guarantees made by Tinuum Group;

(n) the timing and amounts of or changes in future revenue, funding for our business and projects, margins, expenses, earnings, tax rates, cash flows, royalty payment obligations, working capital, liquidity and other financial and accounting measures;

(o) the performance of obligations secured by our surety bonds;

(p) the amount and timing of future capital expenditures needed to fund our business plan;

(q) the impact of capital expenditure overruns on our business;

(r) the timing, adoption, and scope of regulations to control certain chemicals in drinking water and other environmental concerns and the impact of such regulations on our customers' and our businesses, including any increase or decrease in sales of our AC products resulting from such regulations;

(s) the impact of adverse global macroeconomic conditions, including international and domestic tariffs, rising interest rates, recession fears and inflationary pressures, and geopolitical events or conflicts;

(t) opportunities to effectively provide solutions to our current and future customers to comply with regulations, improve efficiency, lower costs and maintain reliability;

(u) our near-term priorities and objectives and our long-term outlook regarding the growth of our business;

(v) the impact of prices of competing power generation sources such as natural gas and renewable energy on demand for our products.

Our expectations are based on certain assumptions, including without limitation, that:

(a) coal will continue to be a significant source of fuel for electrical generation in the U.S.;

(b) we will continue as a key supplier of consumables to the coal-fired power generation industry as it seeks to implement reduction of mercury emissions;

(c) we will successfully complete commissioning of our GAC Facility and our GAC products will be accepted by the APT market;

(b) our foundational PAC business will continue to generate adequate revenues to, along with other sources of capital, operate our business and meet our obligations as they come due;

(c) we will continue as a key supplier of consumables to the coal-fired power generation industry to reduce mercury emissions;

(d) we will be able to obtain adequate capital and personnel resources to meet our operating needs and to fund anticipated growth and our indemnity obligations;

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changes in laws and regulations, accounting rules, prices, economic conditions and market demand;

availability, cost of and demand for alternative energy sources and other technologies and their impact on coal-fired power generation in the U.S.;

availability, cost of and demand for

alternative energy sources and other technologies and their impact on coal-fired power generation in the U.S.;

technical, start up and operational difficulties;

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our inability to effectively and efficiently commercialize new products, including our GAC products;

our inability to effectively manage commissioning and startup of the GAC Facility at our Red River Plant;

our inability to effectively identify solutions to the design flaws in GAC Facility at our Red River Plant or execute on any remedial measures or modifications thereto;

disruptions at any of our facilities, including by natural disasters or extreme weather;

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loss of key personnel;

ongoing effects of the inflation and macroeconomic uncertainty, including from the new U.S.

presidential administration, increased domestic and international tariffs, lingering effects of the pandemic and armed conflicts around the world, and such uncertainty's effect on market demand and input costs;

ongoing effects of the inflation and macroeconomic uncertainty, including from increased domestic and international tariffs and armed conflicts around the world, and such uncertainty's effect on market demand and input costs;

availability of materials and equipment for our business;

intellectual property infringement claims from third parties;

the impacts of any current or future write-downs or write-offs, restructuring, impairment or other charges;

our failure to realize the anticipated benefits of acquisitions, joint ventures, and divestitures we may engage in;

pending litigation;

factors relating to our business strategy, goals and expectations concerning the Arq Acquisition;

factors relating to our business strategy, goals and expectations, including our ability to execute on our GAC business plan;

our ability to maintain relationships with customers, suppliers and others with whom the Company does business and meet supply requirements;

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risks related to diverting management's attention from our ongoing business operations;

costs related to the ongoing manufacturing of our products, including our GAC products;

opportunities for additional sales of our AC products and end-market diversification;

costs related to the ongoing manufacturing of our products, including costs necessary to resume GAC production;

opportunities for additional sales of our AC products and end-market diversification, including for our Corbin Wetcake;

the rate of coal-fired power generation in the U.S.;

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business