What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-03-30 compared with 2025-04-14 · 825 added, 664 removed, 1036 unchanged (59% of the section changed)

1 unchanged sentence

Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm (WithumSmith+Brown, PC;PCAOB ID # 100

Report of Independent Registered Public Accounting Firm (BDO USA, P.C.;

1 unchanged sentence

Consolidated Balance Sheets as of December 31, 2025 and 2024

Consolidated Statements of Operations and Comprehensive Income (Loss) for the period October 2, 2024 through December 31, 2024 (Successor), January 1, 2024 through October 1, 2024 (Predecessor) and the year ended December 31, 2023 (Predecessor)

Consolidated Statement of Changes in Mezzanine Capital for the period January 1, 2024 through October 1, 2024 (Predecessor) and the year ended December 31, 2023 (Predecessor).

Consolidated Statement of Changes in Stockholders’ Equity for the period October 2, 2024 through December 31, 2024 (Successor), January 1, 2024 through October 1, 2024 (Predecessor) and the year ended December 31, 2023 (Predecessor)

Consolidated Statements of Cash Flows for the period October 2, 2024 through December 31, 2024 (Successor), January 1, 2024 through October 1, 2024 (Predecessor) and the year ended December 31, 2023 (Predecessor)

Consolidated Statements of Operations and Comprehensive Income (Loss) for the year ended December 31, 2025 (Successor), the period October 2, 2024 through December 31, 2024 (Successor), and the period January 1, 2024 through October 1, 2024 (Predecessor).

Consolidated Statement of Changes in Mezzanine Capital for the period January 1, 2024 through October 1, 2024 (Predecessor).

Consolidated Statement of Changes in Stockholders’ Equity for the year ended December 31, 2025 (Successor), the period October 2, 2024 through December 31, 2024 (Successor), and the period January 1, 2024 through October 1, 2024 (Predecessor).

Consolidated Statements of Cash Flows for the year ended December 31, 2025 (Successor), the period October 2, 2024 through December 31, 2024 (Successor), and the period January 1, 2024 through October 1, 2024 (Predecessor).

Notes to Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Innventure, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Innventure, Inc.

and subsidiaries (the “Company”) as of December 31, 2025, and the related consolidated statements of operations and comprehensive income (loss), changes in stockholders’ equity, and cash flows for the year ended December 31, 2025, and the related notes (collectively referred to as the "consolidated financial statements").

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 2 to the consolidated financial statements, the Company has incurred operating losses since inception and, as of December 31, 2025, had both an accumulated deficit and working capital deficit, which raise substantial doubt about its ability to continue as a going concern.

Management's plans in regard to these matters are also described in Note 2.

The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the entity’s management.

Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provided a reasonable basis for our opinion.

/s/ WithumSmith+Brown, PC

We have served as the Company's auditor since 2025.

Orlando, Florida

March 30, 2026

PCAOB ID Number 100

Report of Independent Registered Public Accounting Firm

Stockholders and Board of Directors

1 unchanged sentence

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Innventure, Inc.

and Subsidiaries (the “Company”) as of December 31, 2024, (“Successor”) and Innventure, LLC and Subsidiaries as of December 31, 2023 (“Predecessor”), the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity, and cash flows for the period from October 2, 2024 through December 31, 2024 (“Successor”), and the consolidated statements of operations and comprehensive income (loss), changes in mezzanine capital, stockholders’ equity, and cash flows for the period January 1, 2024 through October 1, 2024 (“Predecessor”) and the year ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 (“Successor”) and 2023 (“Predecessor”), and the results of its operations and its cash flows for the period from October 2, 2024 through December 31, 2024 (Successor), the period from January 1 2024 through October 1, 2024 (“Predecessor”) and the year ended December 31, 2023 (“Predecessor”), in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated balance sheet of Innventure, Inc.

and Subsidiaries (the “Company”) as of December 31, 2024, the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity, and cash flows for the period from October 2, 2024 through December 31, 2024 (“Successor”), and the consolidated statements of operations and comprehensive income (loss), changes in mezzanine capital, stockholders’ equity, and cash flows for the period January 1, 2024 through October 1, 2024 (“Predecessor”), and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024, and the results of its operations and its cash flows for the period from October 2, 2024 through December 31, 2024 (Successor), the period from January 1 2024 through October 1, 2024 (“Predecessor”) , in conformity with accounting principles generally accepted in the United States of America.

Going Concern Uncertainty

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/s/ BDO USA, P.C.

We have served as the Company's auditor since 2022.

We served as the Company's auditor from 2022 to 2025.

Raleigh, North Carolina

4 unchanged sentences

(in thousands, except share and per share amounts)

Successor Predecessor

December 31, 2025 December 31, 2024

Cash, cash equivalents and restricted cash $ 60,449 $ 11,119

Restricted cash 5,000 —

Accounts receivable 1,094 283

3 unchanged sentences

Total Current Assets

83,154 24,286

Investments 28,741 28,734

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Accrued expenses 7,386 2,478

Related party payables — 347

Contract liabilities 947 —

Related party notes payable - current — 14,000

Notes payable - current 12,846 625

Term convertible note, current 7,890 —

Convertible note - related party, current 4,331 —

Patent installment payable - current 700 1,225

1 unchanged sentence

Warrant liability 27,458 34,023

Income taxes payable 23 —

Other current liabilities 682 317

Total Current Liabilities

76,276 69,347

Notes payable, net of current portion 8,327 13,654

Convertible promissory note, net — 1,120

Convertible promissory note due to related party, net — 3,381

Embedded derivative liability — 1,994

Earnout liability 3,890 14,752

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Commitments and Contingencies (Note 19)

Mezzanine Capital

Redeemable Class I Units, no par value, 1,000,000 units authorized, issued and outstanding as of December 31, 2023

Redeemable Class PCTA Units, no par value, 3,982,675 units authorized, issued and outstanding as of December 31, 2023

Stockholders' Equity / Unitholders' Deficit

Class B Preferred Units, no par value, 4,639,557 units authorized, and 4,109,961 units issued and outstanding as of December 31, 2023

Class B-1 Preferred Units, no par value, 2,600,000 units authorized, and 342,608 units issued and outstanding as of December 31, 2023

Class A Units, no par value, 10,975,000 units authorized, and 10,875,000 units issued and outstanding as of December 31, 2023

Class C Units, no par value, 1,585,125 units authorized, and 1,570,125 units issued and outstanding as of December 31, 2023

Preferred Stock, $ 0.0001 par value, 25,000,000 shares authorized, and 1,102,000 shares issued and outstanding as of December 31, 2024

Common Stock, $ 0.0001 par value, 250,000,000 shares authorized, and 44,597,154 shares issued and outstanding as of December 31, 2024

Stockholders' Equity

Preferred stock, $ 0.0001 par value, 25,000,000 shares authorized;

Series B Preferred Stock, $ 0.0001 par value, 3,000,000 shares designated, 33,144 and 1,102,000 shares issued and outstanding as of December 31, 2025 and December 31, 2024, respectively.

Series C Preferred Stock, $ 0.0001 par value, 5,000,000 shares designated, 150,000 shares issued and outstanding as of December 31, 2025 and no shares issued and outstanding as of December 31, 2024.

Common Stock, $ 0.0001 par value, 250,000,000 shares authorized, 67,743,847 and 44,597,154 shares issued and outstanding as of December 31, 2025 and December 31, 2024, respectively.

Additional paid-in capital 577,070 502,865

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Accumulated deficit ( 371,603 ) ( 78,262 )

Total Innventure, Inc., Stockholders’ Equity/ Innventure LLC Unitholders' Deficit 425,516 ( 20,045 )

Total Innventure, Inc., Stockholders’ Equity 204,214 425,516

Non-controlling interest 279,462 340,777

Total Stockholders' Equity/ Unitholders' Deficit

766,293 ( 18,486 )

Total Liabilities, Mezzanine Capital and Equity

$ 905,289 $ 21,564

Total Stockholders' Equity 483,676 766,293

Total Liabilities and Stockholder’s Equity $ 599,187 $ 905,289

See accompanying notes to consolidated financial statements.

3 unchanged sentences

(in thousands, except share and per share amounts)

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Successor Successor Predecessor

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Revenue $ 2,056 $ 456 $ 764

4 unchanged sentences

Research and development 25,025 5,340 5,978

Goodwill impairment 346,557 — —

Total Operating Expenses

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Equity method investment (loss) income ( 12,592 ) ( 902 ) 893

Realized gain on conversion of available for sale investment 1,507 — —

Loss on extinguishment of debt ( 16,064 ) — —

Loss on extinguishment of related party debt ( 3,538 ) — —

Loss on conversion of promissory notes — — ( 1,119 )

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Basic and diluted weighted average common shares 54,420,978 43,951,279

Other comprehensive income, net of taxes:

Unrealized gain on available-for-sale debt securities - related party 909 62 —

Total other comprehensive loss, net of taxes 909 62 —

Total comprehensive loss, net of taxes ( 69,184 ) ( 28,136 ) ( 30,984 )

comprehensive income attributable to

Other comprehensive income (loss), net of taxes:

Unrealized gain (loss) on available-for-sale debt securities - related party ( 662 ) 909 62

Reclassification of realized gain (loss) on conversion of available for sale investments ( 1,507 ) — —

Total other comprehensive gain (loss), net of taxes ( 2,169 ) 909 62

Total comprehensive income (loss), net of taxes ( 477,519 ) ( 69,184 ) ( 28,136 )

comprehensive loss attributable to

Non-redeemable non-controlling interest ( 182,033 ) ( 8,339 ) ( 11,762 )

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$ 2,912 $ 7,718 $ 10,630

Proceeds from capital calls to unitholders 130 — 130

Accretion of redeemable units to redemption value 1,565 10,385 11,950

December 31, 2023

2,912 7,718 10,630

Accretion of redeemable units to redemption value 1,565 10,385 11,950

October 1, 2024

$ 4,477 $ 18,103 $ 22,580

See accompanying notes to consolidated financial statements.

6 unchanged sentences

Net loss — — — — ( 16,436 ) — ( 11,762 ) ( 28,198 )

Non-controlling interest acquired — — — — — — 337 337

Issuance of units, net of issuance costs 17,319 — — — — — — 17,319

Unit-based compensation — — — 205 — — 705 910

Distributions to unitholders — — — — ( 241 ) — — ( 241 )

Accretion of redeemable units to redemption value — — — — 5,366 — — 5,366

December 31, 2023 (Predecessor) 38,122 3,323 1,950 844 ( 64,284 ) — 1,559 ( 18,486 )

Net loss — — — — ( 16,436 ) — ( 11,762 ) ( 28,198 )

Other comprehensive loss, net of taxes — — — — — 62 — 62

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October 2, 2024 (Successor) — $ — — $ — $ 11,342 $ ( 15,845 ) $ — $ — $ ( 4,503 )

Net loss — — — — ( 61,754 ) — ( 8,339 ) ( 70,093 )

Effect of acquisition of Innventure LLC — — 43,589,850 4 461,064 — — 343,030 804,098

3 unchanged sentences

Issuance of common shares from warrant exercises — — 259,309 — 2,982 — — — 2,982

Net loss — — — — — ( 61,754 ) — ( 8,339 ) ( 70,093 )

Other comprehensive gain, net of taxes — — — — — — 909 — 909

8 unchanged sentences

and Subsidiaries

Consolidated Statements of Changes in Stockholders' Equity

(in thousands, except share and per share amounts)

Stockholders’ Equity Mezzanine Equity

Series B Preferred Stock Series C Preferred Stock Common Stock Preferred Stock

Shares Amount Shares Amount Shares Amount Additional Paid-In Capital Accumulated Deficit Accumulated OCI Non-Controlling Interest Total Stockholders' Equity Shares Amount

December 31, 2024 (Successor)

1,102,000 $ — — $ — 44,597,154 $ 4 $ 502,865 $ ( 78,262 ) $ 909 $ 340,777 $ 766,293 — $ —

Net loss — — — — — — — ( 293,317 ) — ( 182,033 ) ( 475,350 ) — —

Series B Preferred Stock buyback ( 5,000 ) — — — — — ( 50 ) — — — ( 50 ) — —

Series B Preferred Stock issued for paid-in-kind dividends 21,808 — — — — — 218 — — — 218 — —

Issuance of common shares, net of issuance costs — — — — 1,699,228 — 10,122 — — — 10,122 — —

Issuance of common shares for services — — — — 119,971 — 1,102 — — — 1,102 — —

Conversion of convertible debentures — — — — 11,003,432 1 46,999 — — — 47,000 — —

RSU settlement, net — — — — 343,011 — ( 479 ) — — — ( 479 ) — —

Vesting of earnout shares — — — — 2,344,682 1 873 — — — 874 — —

Other comprehensive gain, net of taxes — — — — — — — — ( 2,169 ) — ( 2,169 ) — —

Conversion of related party notes — — — — — — — — — — — 2,310,848 23,109

Issuance of Series C Preferred Stock, net — — — — — — — — — — — 275,000 2,663

Issuance of Series C Preferred Stock for services — — — — — — — — — — — 300,000 3,000

Non-controlling interest issued and related transfers — — — — — — ( 33,693 ) — — 113,308 79,615 — —

Distributions to stockholders — — — — — — — ( 24 ) — — ( 24 ) — —

Stock-based compensation — — — — — — 20,462 — — 7,410 27,872 — —

Accrued preferred dividends — — — — — — ( 86 ) — — — ( 86 ) — ( 34 )

Conversion to Common Stock ( 1,085,664 ) — — — 7,636,369 1 27,269 — — — 27,270 ( 2,735,848 ) ( 27,270 )

Transfer of Series C Preferred Stock from Mezzanine equity to Stockholders' equity — — 150,000 — — — 1,468 — — — 1,468 ( 150,000 ) ( 1,468 )

December 31, 2025 (Successor)

33,144 — $ — 150,000 $ — 67,743,847 $ 7 $ 577,070 $ ( 371,603 ) $ ( 1,260 ) $ 279,462 $ 483,676 — $ —

Innventure, Inc.

and Subsidiaries

Consolidated Statements of Changes in Stockholders' Equity

(in thousands, except share and per share amounts)

See accompanying notes to consolidated financial statements.

Innventure, Inc.

and Subsidiaries

Consolidated Statements of Cash Flows

(in thousands, except share and per share amounts)

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Successor Successor Predecessor

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Cash Flows Used in Operating Activities

Net loss $ ( 475,350 ) $ ( 70,093 ) $ ( 28,198 )

Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Stock-based compensation 27,872 16,338 1,056

16,338 1,056 910

Interest income on debt securities - related party ( 394 ) ( 106 ) ( 110 )

Change in fair value of financial liabilities ( 16,146 ) 20,946 478

Change in fair value of payables due to related parties — 468 ( 232 )

Net loss on investments - due to related parties — — 468

Write-off of loan commitment fee asset — 10,041 —

Non-cash interest expense on notes payable 6,588 248 351

Net (gain) loss on investments — ( 11,547 ) 6,448

Equity method investment gain (loss) 902 ( 893 ) 632

Net gain on investments ( 131 ) — ( 11,547 )

Accrued unpaid interest on note payable 336 69 930

Equity method investment loss (income) 12,592 902 ( 893 )

Realized gain on conversion of available for sale investments ( 1,507 ) — —

Loss on extinguishment of debt 16,064 — —

Loss on extinguishment of related party debt 3,538 — —

Loss on conversion of promissory notes — — 1,119

1 unchanged sentence

Depreciation and amortization 22,506 5,455 146

Payment of patent installment — ( 250 ) —

Non-cash rent costs 64 185 192

Accrued unpaid interest on note payable 69 930 —

Goodwill impairment 346,557 — —

Other costs, net 195 64 185

Changes in operating assets and liabilities:

6 unchanged sentences

Stock-based compensation liability ( 921 ) 1,160 —

Income taxes payable 23 — —

Other current liabilities ( 358 ) ( 77 ) ( 146 )

Contract liabilities 947 — —

Obligation to issue equity — 3,000 10,920

Other assets ( 61 ) — ( 20 )

Patent installment payable ( 525 ) — ( 250 )

Net Cash Used in Operating Activities

( 80,683 ) ( 29,214 ) ( 18,848 )

Cash Flows Provided by (Used in) Investing Activities

Purchase of shares in equity method investee — — ( 2,000 )

Contributions to equity method investee — — ( 130 )

Cash Flows (Used in) Provided by Investing Activities

Investment in available-for-sale debt securities - equity method investee ( 2,708 ) — —

Investment in debt securities - equity method investee — — ( 7,400 )

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Cash withdrawn from trust as a result of business combination — 11,342 —

Net Cash Provided by (Used in) Investing Activities

6,822 ( 5,957 ) ( 4,667 )

Net Cash (Used in) Provided by Investing Activities ( 4,125 ) 6,822 ( 5,957 )

Cash Flows Provided by Financing Activities

2 unchanged sentences

Proceeds from the issuance of convertible promissory note 4,350 — —

Proceeds from the issuance of term convertible notes 14,950 — —

Proceeds from issuance of debt securities, net of issuance costs 40,500 19,455 —

Payment of debts ( 4,617 ) ( 250 ) ( 540 )

Receipt of Capital from Class I Unitholder — — 130

Distributions to Stockholders ( 76 ) ( 663 ) —

3 unchanged sentences

139,138 33,466 38,441

Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash 11,074 13,636 ( 4,969 )

Net Increase in Cash, Cash Equivalents and Restricted Cash 54,330 — 11,074 — 13,636

Cash, Cash Equivalents and Restricted Cash Beginning of period 11,119 45 2,575

6 unchanged sentences

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Supplemental Cash Flow Information

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Transfer of loan commitment fee asset — 6,694 —

Recognition of right of use asset and corresponding lease liability 927 — —

Extinguishment of debt with Series C Preferred Stock 14,000 — —

Contribution of Series C Preferred Stock to equity method investee 5,783 — —

Conversion of AFX available-for-sale term loan into equity method investments 8,757 — —

Issuance of common stock as repayment of convertible debt 47,000 — —

Issuance of stock in exchange for services 4,102 250 —

Conversion of preferred stock into common stock 36,910 — —

Transfer of Series C Preferred Stock from Mezzanine to Stockholders' equity 1,440 — —

Embedded derivative in association with Convertible Debentures 1,774 — —

Equity reallocation between non-controlling interest and additional paid-in capital 36,963 — —

Embedded derivative liability derecognition 3,297 — —

See accompanying notes to consolidated financial statements.

2 unchanged sentences

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Nature of Business

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and its consolidated subsidiaries (the “Successor”) for all periods after Closing.

Innventure founds, funds, and operates companies with a focus on transformative, sustainable technology solutions that we acquire or license from technology innovators, which are typically Multinational Corporations (‘‘MNCs’’).

As owner-operators, our goal is to take what we believe to be breakthrough technologies from evaluation to scaled commercialization utilizing an approach designed to help mitigate risk in collaboration with the MNCs (our channel partner(s)), as we build disruptive companies that we believe have the potential to achieve a target enterprise value of at least $1 billion.

Innventure is an industrial growth conglomerate that founds, funds, and operates companies with a focus on commercializing transformative, sustainable technology solutions acquired or licensed from technology innovators, which are typically Multinational Corporations (‘‘MNCs’’), with the intent to maximize value for investors and other stakeholders through positive cash flow generated through long-term ownership of operating subsidiaries.

As owner-operators, our goal is to take what we believe to be breakthrough technologies that have advanced beyond proof of concept from evaluation to scaled commercialization utilizing an approach designed to help mitigate risk in collaboration with the MNCs (our channel partner(s)), as we build disruptive companies that we believe have the potential to achieve a target enterprise value of at least $ 1 billion.

We define ‘‘disruptive’’ as innovations that, in our opinion, have the ability to significantly change the way businesses, industries, markets, and/or consumers operate.

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As a result of the application of the acquisition method of accounting as of the Closing Date, the accompanying Consolidated Financial Statements include a black line division which indicates that the Predecessor and Successor reporting entities shown are presented on a different basis and are therefore, not comparable.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Accounting Policies

2 unchanged sentences

generally accepted accounting principles (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”).

The Successor consolidated financial statements include the accounts of the Company, its wholly owned or majority-owned subsidiaries and entities in which the Company is deemed to have a direct or indirect controlling financial interest based on either a variable interest model or voting interest model.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Predecessor consolidated financial statements include all amounts of Innventure LLC and its consolidated subsidiaries.

The Successor consolidated financial statements include the accounts of the Company, its wholly owned and majority-owned subsidiaries and entities in which the Company is deemed to have a direct or indirect controlling financial interest based on either a variable interest model or voting interest model.

The Predecessor consolidated financial statements include all accounts of Innventure LLC and its consolidated subsidiaries.

All intercompany transactions and balances have been eliminated in consolidation.

Reclassifications

Certain amounts reported previously have been reclassified to conform to the current year presentation with no effect on total stockholders' deficit, or net income as previously reported.

During the year ended December 31, 2025, we identified an error and recorded an immaterial out of period adjustment of $ 12.4 million to correct an overstatement of Additional paid-in capital, an immaterial out of period adjustment of $ 4.5 million to correct understatement of Net loss attributable to Innventure, Inc.

stockholders and an immaterial out of period adjustment of $ 16.9 million to correct an understatement of Non-controlling interest.

The impact of the adjustments are not material to the consolidated financial statements for any interim or annual periods prior to December 31, 2025 nor the current financial period.

The out of period adjustment to Additional paid-in capital is included in Non-controlling interest issued and related transfers within the condensed consolidated statements of changes in mezzanine and stockholders' equity (deficit) and the adjustment related to Net loss attributable to Innventure, Inc.

within Comprehensive loss attributable to non-controlling interest on the consolidated statements of operations and comprehensive income (loss).

Going Concern

As of December 31, 2024, the Company had cash balance of $ 11,119 , accumulated deficit of $ 78,262 and a working capital deficit of $ 45,061 .

During the year ended December 31, 2024, the Company incurred a net loss of $ 70,093 for the Successor period from October 2, 2024 through December 31, 2024 and $ 28,198 for Predecessor period from January 1, 2024 through October 1, 2024.

As of December 31, 2025, the Company had a cash balance of $ 60.4 million, accumulated deficit of $ 371.6 million and a working capital deficit of $ 6.9 million.

During the year ended December 31, 2025 the Company incurred a net loss of $ 475.4 million.

Management believes the Company will continue to incur losses and negative cash flows from operating activities for the foreseeable future and will need additional capital or debt financing to proceed with its business plans.

Additionally, the future value of investments held is unpredictable and subject to market events outside of the Company’s control.

Subsequent to December 31, 2024, the Company secured additional gross proceeds of $ 925 through Common Stock issuances as part of the Company’s Standby Equity Purchase Agreement.

The Company entered into preferred stock purchase agreements (each, a “Series C Purchase Agreement”, and collectively, the “Series C Purchase Agreements”) on March 24, 2025 to receive gross proceeds of $ 2,750 .

Additionally, the Company converted Related party notes into Series C equity, with aggregate principal of $ 14,000 , as discussed in Note 5.

The conversion was not determined to be a trouble debt restructuring.

Further, the Company entered into a financing agreement on March 25, 2025 to receive up to $ 30,000 in exchange for convertible debentures, contingent upon certain reporting requirements.

For further details on these events, refer to Note 21.

Subsequent Events.

In connection with the Company’s assessment of going concern considerations, management has determined that in order to maintain its current level of operations, the Company will require additional working capital from cash flows from operations, the sale of its capital and/or issuance of debt.

9 unchanged sentences

Accordingly, actual results could differ from those estimates.

Fair Value Measurements

The Company measures the fair value of assets and liabilities on a recurring and nonrecurring basis according to a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

categorizes each of its fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety.

Fair Value Measurements

The Company categorizes each of its fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety.

These levels are:

27 unchanged sentences

Investments for further discussion on investments in VIEs.

Impairments of Investments

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Impairments of Investments

Management periodically assesses equity method investments for impairment.

2 unchanged sentences

Available-for-Sale Investments

Available-for-sale (“AFS”) debt securities are generally reported at estimated fair value, with unrealized gains and losses recorded in accumulated other comprehensive loss which is included within stockholders’ deficit.

Available-for-sale (“AFS”) debt securities are generally reported at estimated fair value, with unrealized gains and losses recorded in other comprehensive income (loss) on our consolidated statements of operations and comprehensive income (loss).

AFS debt securities with an amortized cost basis in excess of estimated fair value are assessed to determine what amount of that difference, if any, is caused by expected credit losses.

Allowance for credit losses on AFS debt securities are recognized as a charge in other loss on our consolidated statements of income, and any remaining unrealized losses, net of taxes, are included in accumulated other comprehensive income (loss) in stockholders' equity.

Allowance for credit losses on AFS debt securities are recognized as a charge in other loss on our consolidated statements of operations and comprehensive income (loss), and any remaining unrealized losses, net of taxes, are included in other comprehensive income (loss).

Cash, Cash Equivalents and Restricted Cash

2 unchanged sentences

Cash that is restricted and not available for general operations is considered restricted cash.

The Company's restricted cash is related to cash received through the Company's Class B Preferred Units capital raise and held in escrow prior to finalization of the Class B Preferred Units investment.

As of December 31, 2024 and 2023, the Company had restricted cash related to the capital raise of $ — and $ 100 , respectively.

The Company's restricted cash is related to cash received through the Company's Class B Preferred Stock capital raise and held in escrow prior to finalization of the Class B Preferred Stock investment.

As of December 31, 2025, the Company had restricted cash related to the capital raise of $ 5.0 million and, as of December 31, 2024, had no restricted cash.

Additionally, the Company maintains certain compensating balances that may be withdrawn, but the availability of short-term lines of credit is dependent upon the maintenance of such compensating balances.

As of December 31, 2024 and 2023, the Company had compensating balances of $ 100 and $ 300 , respectively.

As of December 31, 2025 and 2024, the Company had compensating balances of $ 0.1 million.

Inventories are stated at the lower of cost or net realizable value.

Cost is determined principally under the average cost method.

The Company periodically reviews its inventory and identifies that which is excess, slow moving and obsolete by considering factors such as inventory levels, expected product life and forecasted sales demand.

Any identified excess, slow moving and obsolete inventory is written down to its net realizable value through a charge to cost of sales.

Property, Plant and Equipment

Property, plant and equipment is recorded at cost less accumulated depreciation.

The Company depreciates the cost of property, plant and equipment using the straight-line method with depreciable lives of 10 years for Machinery & equipment, 3 years for Computers & office equipment and the lesser of useful life or lease terms for Leasehold improvements.

The Company expenses normal maintenance and repair costs as incurred.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Impairment of Long-Lived Assets

2 unchanged sentences

In the event such an asset is considered impaired, the impairment to be recognized is measured by the amount by which the carrying value of the asset exceeds the estimated fair value of the asset.

If such assets are not impaired, but their useful lives have decreased, the remaining net book value is

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

depreciated over the revised useful life.

If such assets are not impaired, but their useful lives have decreased, the remaining net book value is depreciated over the revised useful life.

Assets to be disposed of are reported at the lower of the carrying value of estimated fair value less estimated costs to sell.

8 unchanged sentences

The Company operates in one operating segment which the Company considers to be its only reporting unit.

There were no impairments of goodwill recognized for the year ended December 31, 2024.

There was a $ 346.6 million impairment of goodwill recognized for the year ended December 31, 2025 and no impairment recognized for the year ended December 31, 2024.

Stock and Warrants

7 unchanged sentences

In order to determine the appropriate classification, consideration is given as to whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require net cash settlement in a circumstance outside of the Company’s control, among other conditions.

This assessment requires the use of judgement and is conducted at the time of warrant issuance and as of each reconsideration and balance sheet date while the warrants are outstanding.

This assessment requires the use of judgment and is conducted at the time of warrant issuance and as of each reconsideration and balance sheet date while the warrants are outstanding.

For issued or modified warrants that meet all of the criteria for stockholders' equity classification, the warrants are recorded as a component of additional paid-in capital at fair value at the time of issuance.

1 unchanged sentence

The change in fair value is recognized in the Company’s consolidated statements of operations and comprehensive income (loss).

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Revenue Recognition

3 unchanged sentences

Sales discounts and other incentives are treated as variable consideration when estimating the revenue to be recognized.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The Company earns management fees, consulting revenue and carried interest allocations from investment advisory services it provides to its customers.

The Company considers the investment advisory services represent a single performance obligation.

Management fees, generally 1 - 2 % of capital committed to the ESG Fund I, L.P.

Management fees, generally 1 - 2 % of capital committed to the Innventus ESG Fund I, L.P.

(the “ESG Fund”), are recognized over time using the time-elapsed method, resulting in straight-line revenue recognition over the performance period.

These fees are calculated and paid quarterly in advance based on the capital commitments at the start of each quarter.

Management fees are considered variable consideration but are typically fully recognized at the end of each reporting period as they are not subject to clawback.

11 unchanged sentences

Consequently, federal income taxes were not payable or provided by Innventure LLC but various corporate subsidiaries were subject to corporate federal, state, and local taxes.

There was no federal income tax recorded by Innventure LLC for the year ended December 31, 2023, but corporate income taxes were recorded for the period from January 1, 2024 through October 1, 2024.

Corporate income taxes were recorded for the period from January 1, 2024 through October 1, 2024.

On October 2, 2024, the Business Combination occurred which merged Innventure LLC into Innventure Merger Sub, LLC, a wholly owned subsidiary of the Company.

The Company became a publicly traded entity and is being taxed as a corporation.

The Company became a publicly traded entity and began being taxed as a corporation.

The Company accounts for income taxes pursuant to the asset and liability method of ASC 740, Income Taxes, which requires the recognition of current tax liabilities or receivables for the amount of taxes that are estimated as payable or refundable for the current year, and deferred tax assets and liabilities for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts and their respective tax bases of assets and liabilities and the expected benefits of net operating loss and credit carryforwards.

3 unchanged sentences

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible.

The Company follows the provisions of ASC 740-10 related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements.

ASC 740-10 prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

taken in income tax returns.

The Company follows the provisions of ASC 740-10 related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements.

ASC 740-10 prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns.

The benefit of tax positions taken or expected to be taken in our income tax returns is recognized in the financial statements if such positions are more likely than not of being sustained upon examination by taxing authorities.

5 unchanged sentences

Recently Adopted Accounting Pronouncements

In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ("ASU 2022-03").

ASU 2022-03 clarifies that contractual sale restrictions should not be considered in measuring the fair value of equity securities.

ASU 2022-03 is effective for fiscal years beginning after December 15, 2023, including interim periods therein, with early adoption permitted.

The Company adopted this ASU on January 1, 2024, and the adoption did not have a material impact on the Company’s consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which enhances prior reportable segment disclosure requirements in part by requiring entities to disclose significant expenses related to their reportable segments.

The amendments in ASU 2023-07 are effective on a retrospective basis for annual periods beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures ("ASU 2023-09"), which requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid to enhance the transparency and decision usefulness of income tax disclosures.

The amendments in this ASU are effective for annual periods beginning after December 15, 2024 on a prospective basis.

The Company adopted ASU 2023-09 for the year ended December 31, 2025.

The Company has made the required disclosures related to this ASU within Note 16.

Business Segment Data.

Income taxes.

Recently Issued But Not Yet Adopted Accounting Standards

5 unchanged sentences

The Company will continue to evaluate the impact of this guidance on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

The amendments in this ASU are effective for annual periods beginning after December 15, 2024 on a prospective basis.

The Company is currently evaluating the impact that the adoption of this accounting standard will have on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

6 unchanged sentences

The Company is currently evaluating the impact that the adoption of this accounting standard will have on its consolidated financial statements.

In May 2025, the FASB issued ASU 2025-04, Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606):

Clarifications to Share-Based Consideration Payable to a Customer , which reduces the diversity in practice and improves the decision usefulness and operability of the guidance for share-based consideration payable to a customer in conjunction with selling goods or services.

The amendments in this ASU are effective for annual reporting periods (including interim reporting periods within annual reporting periods) beginning after December 15, 2026.

Early adoption is permitted.

The Company is currently evaluating the impact that the adoption of this accounting standard will have on its consolidated financial statements.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Successor Predecessor

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets , which provides a practical expedient for the application of the current expected credit loss (“CECL”) model to current accounts receivable and contract assets.

The amendments in this ASU are effective for the fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods.

Early adoption is permitted.

If elected, the amendments in this ASU should be applied prospectively.

The Company is currently evaluating the impact ASU 2025-05 will have on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software , which increases the operability of the recognition guidance considering different methods of software development.

The amendments in this ASU are effective for the fiscal years beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

Early adoption is permitted as of the beginning of an annual reporting period.

If elected, the amendments in this ASU should be applied prospectively.

The Company is currently evaluating the impact ASU 2025-06 will have on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606):

Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract , which is expected to reduce the cost and complexity of evaluating whether contracts with features are derivatives, better portray the economics of those contracts in the financial statements, reduce diversity from the application of the current guidance and changing business environment, and to clarify Topic 606 applicability to share-based noncash consideration for the transfer of goods or services.

The amendments in this ASU are effective for the fiscal years beginning after December 15, 2026, and interim reporting periods within those annual reporting periods.

Early adoption is permitted.

If elected, the amendments in this ASU should be applied prospectively.

The Company is currently evaluating the impact ASU 2025-07 will have on its consolidated financial statements.

December 31, 2025 December 31, 2024

(in thousands)

Equity-method investments $ 19,495 $ 17,547

Exchange-traded investments at fair value — 9,685

Investment in debt securities - AFS 9,246 11,187

2 unchanged sentences

Equity-method investments

During the Predecessor period, the Company’s equity-method investment in the ESG Fund reflects the Company’s general partner interest which represents approximately 5 % of the ESG Fund’s total capital commitments and limited partner interests which were received in exchange for shares of Innventure LLC and Accelsius Holdings LLC prior to October 1, 2024.

As of December 31, 2024, the Company’s equity-method investment in the ESG Fund solely reflects interests held by the Company as a limited partner due to the deconsolidation of certain SILOs as further discussed in Note 8.

The Predecessor period general partner interest is not consolidated because the ESG Fund is not considered a VIE and the Company does not hold a controlling financial interest in the ESG Fund under the VOE model.

The ESG Fund is an investment company that follows a specialized basis of accounting established by GAAP.

The Company’s partnership interests in the ESG Fund are substantially illiquid.

The Company’s general partnership interest in the ESG Fund is substantially illiquid.

While the ESG Fund’s holdings are accounted for at fair value, the equity-method investment in the ESG Fund is adjusted to reflect the fair value of the underlying investments of the ESG Fund as of December 31, 2025 and 2024.

1 unchanged sentence

Valuation adjustments reflecting consideration of credit quality, concentration risk, sales restrictions and other liquidity factors are integral to valuing these instruments.

The Company determined that AeroFlexx has insufficient equity at risk to fund its operations, as of December 31, 2024 and therefore will meet the definition of a VIE.

The Company determined that AeroFlexx has insufficient equity at risk to fund its operations, as of December 31, 2025 and 2024, and therefore will meet the definition of a VIE.

The Company does not have power to direct AeroFlexx's operations.

1 unchanged sentence

Therefore, the Company is not considered the primary beneficiary and does not consolidate AeroFlexx as a VIE.

The Company accounts for its investments in AeroFlexx under the equity method and held a 34 % and 31 % interest in AeroFlexx as of December 31, 2024 and 2023, respectively.

The Company’s carrying amounts and maximum exposure relating to AeroFlexx, were as follows:

Successor Predecessor

The Company accounts for its investments in

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

AeroFlexx under the equity method and held a 37.1 % and 34.1 % interest in AeroFlexx as of December 31, 2025 and 2024, respectively.

The Company’s carrying amounts and maximum exposure relating to AeroFlexx, were as follows (in thousands):

December 31, 2025 December 31, 2024

4 unchanged sentences

$ 38,957 $ 38,957 $ 32,589 $ 32,589

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Summarized financial information:

Balance sheets

Balance sheets (in thousands)

ESG Fund AeroFlexx

4 unchanged sentences

Total Equity (Deficit) $ 85,137 $ 97,352 $ ( 13,373 ) $ ( 10,859 )

Statements of operation

Statements of operation (in thousands)

ESG Fund AeroFlexx

4 unchanged sentences

Net Income (Loss) $ ( 12,263 ) $ 39,437 $ ( 15,824 ) $ ( 13,663 )

Exchange-traded investments

The Company previously invested in PureCycle Technologies (“PCT”) as the first company formed in partnership with a multinational corporation.

In 2021, PCT merged with a special purpose acquisition company and became a publicly-traded entity.

The shares of PCT's common stock held by the Company are classified as an Exchange-traded investment at FVTNI.

During the Predecessor period from January 1, 2024 through October 1, 2024, the Company sold 400,000 PCT shares for aggregate net proceeds of $ 2,302 .

The PCT shares were measured at their fair value immediately prior to the transactions.

All remaining PCT shares were derecognized as a result of the Business Combination.

Investment in debt securities - AFS

On July 1, 2024, the Company entered into a loan agreement with AeroFlexx under which the Company will lend up to $ 10,000 to AeroFlexx.

As of July 1, 2024, the aggregate outstanding principal of working capital interest-free advances to AeroFlexx, amounting to $ 7,635 were included as outstanding term loans under this agreement.

During the Predecessor period from January 1, 2024 through October 1, 2024, the Company lent AeroFlexx the remaining principal balance of $ 2,365 under this agreement.

The term loans and any unpaid accrued interest are required to be repaid by the maturity date, which is the earlier of (i) December 31, 2026 or (ii) the date of the sale, transfer or other disposition all of AeroFlexx’s assets or AeroFlexx's stock.

After any full or partial repayment of the term loans, AeroFlexx may borrow additional funds up to the $ 10,000 limit until the maturity date.

On July 1, 2024, the Company entered into a loan agreement with AeroFlexx under which the Company will lend up to $ 10.0 million to AeroFlexx.

After any full or partial repayment of the term loans, AeroFlexx may borrow additional funds up to the $ 10.0 million limit until the maturity date.

The loans bear interest at the applicable federal rate published by the Internal Revenue Service and is adjusted on a quarterly basis.

The Company has an option to convert the outstanding principal amount of the term loans and any unpaid accrued interest into shares or units in connection with the next issuance of equity securities by AeroFlexx, at a price equal to 100 % of the price per share or unit and on the same terms and conditions as apply to such issuance.

If, by January 1, 2025, AeroFlexx has not raised equity financing equal to or more than a target of $ 10,000 , then on January 2, 2025, the outstanding principal and any unpaid accrued interest on the term loans will automatically convert into Class D preferred units of AeroFlexx at the same price per unit and on the same terms and conditions as the Class D preferred unit of AeroFlexx purchased by the Company prior to the date of this loan agreement, up to the amount necessary to reach the $ 10,000 target.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

During 2024, the Company lent AeroFlexx the entire $ 10.0 million principal balance under this agreement.

As of January 1, 2025, AeroFlexx was unable to raise any additional equity financing;

therefore, the outstanding principal and unpaid accrued interest with an amount equal to the equity deficit of $ 7.3 million was automatically converted into Class D preferred units of AeroFlexx (“Class D Units”) at the price of $ 6.83 per share in accordance with the loan agreement.

Upon conversion, a realized gain of $ 1.5 million was recognized for the year ended December 31, 2025 and is included in non-operating income in the consolidated statements of operations and comprehensive income (loss).

The total principal balance drawn as of December 31, 2025 was $ 10.0 million.

During the year ended December 31, 2025, $ 4.4 million was reclassified from Due from related parties under the term loan and $ 2.7 million was drawn down by AeroFlexx under the term loan.

The Company accounted for the loans as an investment in debt securities and classified them as available for sale debt securities.

Based on the AFS classification, the Company records this investment at fair value at each reporting date and as such recorded the changes in fair value of these loans (including the adjustment to fair value at inception date) in Other Comprehensive Income ("OCI").

The amortized cost, gross unrealized gains and losses, and fair value of AFS debt securities as of December 31, 2024 is represented in the table below:

Amortized cost Gross unrealized gains Fair value

The amortized cost, gross unrealized gains and losses, and fair value of AFS debt securities is represented in the table below (in thousands):

Amortized cost Gross unrealized gains Gross unrealized losses Fair value

December 31, 2025

Investment in Debt Securities - AFS $ 10,444 $ — $ ( 1,198 ) $ 9,246

At December 31, 2024, there was no allowance for credit loss related to the available for sale securities portfolio.

Accrued interest receivable on available for sale debt securities totaled $ 216 at December 31, 2024.

The amortized cost and fair value of debt securities, by contractual maturity, as of December 31, 2024 is shown below.

December 31, 2024

Investment in Debt Securities - AFS $ 10,278 $ 909 $ — $ 11,187

At December 31, 2025 and 2024, there was no allowance for credit loss related to the available for sale securities portfolio.

Accrued interest receivable on available for sale debt securities totaled $ 0.4 million and $ 0.2 million at December 31, 2025 and 2024, respectively.

The amortized cost and fair value of debt securities, by contractual maturity, as of December 31, 2025 is shown below (in thousands).

Expected maturities can differ from contractual maturities.

1 unchanged sentence

Due within one year $ 10,444 $ 9,246

Due after one year through five years 10,278 11,187

Due after five years — —

$ 10,444 $ 9,246

As the contractual maturity of the loan is in 2026, it is included in the non-current line item Investments of the consolidated balance sheets.

The change in fair value of this investment in debt securities of $ 909 for the Successor period from October 2, 2024 through December 31, 2024 is included as Unrealized gain on available-for-sale debt securities - related party in the consolidated statements of operations and comprehensive income (loss).

As this investment was acquired at fair value as part of the Business Combination there is no activity for the Predecessor periods.

Fair Value Hierarchy

The following tables present the Company’s fair value hierarchy for assets and liabilities measured at fair value on a recurring basis as of December 31, 2024 (Successor) and December 31, 2023 (Predecessor):

As the contractual maturity of the loan is December 31, 2026, it is included in the current line item Investments of the consolidated balance sheets.

The decrease of $ 0.7 million and an increase of $ 0.9 million in fair value of this investment in debt securities for the years ended December 31, 2025 and 2024, respectively, is included as Unrealized gain (loss) on available for sale debt securities - related party in the consolidated statements of operations and comprehensive income (loss).

Additionally, the Company’s carrying amount and maximum exposure relating to AeroFlexx advances and other receivables were $ 10.8 million and $ 4.5 million as of December 31, 2025 and December 31, 2024, included in Due from related parties on the consolidated balance sheets.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

December 31, 2024 (Successor) Quoted Prices

Fair Value Hierarchy

The following tables present the Company’s fair value hierarchy for assets and liabilities measured at fair value on a recurring basis (in thousands):

December 31, 2025 Quoted Prices

Identical Assets

6 unchanged sentences

2024 WTI Warrant liability — — 13,080 13,080

2025 WTI Warrant liability — — 3,230 3,230

Private placement warrant liability — 11,148 — 11,148

December 31, 2023 (Predecessor) Quoted Prices in Active Markets for Identical Assets

December 31, 2024 Quoted Prices in Active Markets for Identical Assets

(Level 1) Significant Other Observable Inputs

1 unchanged sentence

(Level 3) Total

Exchange-traded investments at FVTNI $ 9,685 $ — $ — $ 9,685

Embedded derivative liability $ — $ — $ 1,994 $ 1,994

Related party payables 347 — — 347

Investment in debt security - AFS $ — $ — $ 11,187 $ 11,187

Earnout liability $ — $ — $ 14,752 $ 14,752

2024 WTI Warrant liability — — 17,230 17,230

Private placement warrant liability — 16,793 — 16,793

Gains and losses for such assets and liabilities categorized within the Level 3 table set forth may include changes in fair value that are attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3).

Changes in the estimated fair value of Level 3 financial assets and liabilities that are measured on a recurring basis for the Successor period from October 2, 2024 through December 31, 2024, the Predecessor period from January 1, 2024 through October 1, 2024 and the Predecessor year ended December 31, 2023, respectively, are as follows:

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Forward Contract Embedded Derivative Liability Investment in debt securities - AFS Earnout Liability WTI Warrant Liability

Changes in the estimated fair value of Level 3 financial assets and liabilities that are measured on a recurring basis are as follows (in thousands):

Forward Contract Embedded derivative liability - convertible promissory notes Embedded derivative liability - August 2025 Notes Investment in debt securities - AFS Earnout liability

2024 WTI Warrant liability 2025 WTI Warrant liability Embedded derivative liability (asset) - Convertible Debentures

Balance as of January 1, 2024 (Predecessor)

Additions — 1,119 — — —

Change in fair value — ( 766 ) — — —

Balance as of December 31, 2023 (Predecessor) $ — $ 1,994 $ — $ — $ —

$ — $ 1,994 $ — $ — $ — $ — $ — $ —

Additions — — — 10,110 — — — —

2 unchanged sentences

Balance as of October 1, 2024 (Predecessor)

$ — $ — $ — $ 10,172 $ — $ — $ — $ —

Balance as of October 2, 2024 Successor)

— — — 10,172 11,352 — — —

Additions 54 — — 106 — 15,690 — —

2 unchanged sentences

Balance as of December 31, 2024 (Successor)

There were no transfers in or out of levels during the Successor period from October 2, 2024 through December 31, 2024, the Predecessor period from January 1, 2024 through October 1, 2024, or for the Predecessor year ended December 31, 2023.

$ — $ — $ — $ 11,187 $ 14,752 $ 17,230 $ — $ —

Balance as of January 1, 2025 (Successor) $ — $ — $ — $ 11,187 $ 14,752 $ 17,230 $ — $ —

Additions — — — 7,477 — — 3,090 1,476

Settlement and derecognitions — — ( 1,677 ) ( 8,756 ) ( 873 ) — — ( 3,297 )

Change in fair value — — 1,677 ( 662 ) ( 9,989 ) ( 4,150 ) 140 1,821

Balance as of December 31, 2025 (Successor) $ — $ — $ — $ 9,246 $ 3,890 $ 13,080 $ 3,230 $ —

There were no transfers in or out of levels during the Successor period for the year ended December 31, 2025, the Successor period from October 2, 2024 through December 31, 2024, or the Predecessor period from January 1, 2024 through October 1, 2024.

Standby Equity Purchase Agreement

On October 24, 2023, the Company entered into the Standby Equity Purchase Agreement (“SEPA”) with Yorkville, as further described in Note 13.

On October 24, 2023, the Company entered into the Standby Equity Purchase Agreement (“SEPA”) with Yorkville (as defined below), as further described in Note 13.

Stockholders' Equity with applicable terms defined.

The SEPA became effective concurrently with the Business Combination.

The SEPA includes two components subject to fair value measurement:

The SEPA includes two components subject to fair value

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

the Purchased Put Option and Forward Contract.

1 unchanged sentence

The Purchased Put Option is accounted for as a derivative asset, initially measured at fair value upon Closing and subsequently measured at fair value each reporting period with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss).

The Purchased Put Option fair value is considered de minimis upon Closing due to the exercise price being at a discount to market prices and remains de minimis as of December 31, 2024.

The Forward Contract is initially measured at fair value upon any Advance Notice and subsequently remeasured with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss).

The Purchased Put Option fair value is considered de minimis upon Closing due to the exercise price being at a discount to market prices and remains nominal as of December 31, 2025 and 2024.

The Forward Contract is initially measured at fair value upon any Advance Notice (as defined below) and subsequently remeasured with changes in fair value recorded in the consolidated statements of operations and comprehensive income (loss).

A derivative liability or asset will be recorded when there is an Advance Notice outstanding as of a reporting period.

There were no outstanding Advance Notices as of December 31, 2024.

Derivative Liabilities

Embedded derivative liabilities contained within the 2025 Notes (as defined and further described in Note 5.

Borrowings) are stated at fair value.

Fair value is determined utilizing discounted cash flows, using unobservable market data inputs, and an option pricing model based on a probability-weighted expected outcome with respect to a

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

financing or a change of control.

The derivatives associated with the 2025 Notes were settled in March 2024 due to conversion of the 2025 Notes in a qualified financing.

A summary of the significant unobservable inputs utilized to estimate the fair value is as follows:

Embedded derivative within 2025 Note issued August 18, 2022 with a principal balance of $ 4,000

Settlement December 31, 2023

Discount Rate

35 % 35 % - 36 %

Probability of Expected Outcomes

Financing 100 % 95 %

Change in control — % 3 %

Other — % 2 %

Embedded derivative within 2025 Notes issued June 7 & July 3, 2023 with an aggregate principal balance of $ 2,000

Discount Rate

Probability of Expected Outcomes

Financing 100 % 95 %

Change in control — % 3 %

Other — % 2 %

Significant increases or decreases to any of these inputs would result in a significantly higher or lower liability.

There were no outstanding Advance Notices as of December 31, 2025 and 2024.

Investment in debt securities - AFS

1 unchanged sentence

The terms of the securities are such that they are highly likely to convert into Class D Units of AeroFlexx.

The fair value of the debt securities is estimated on an as-converted basis using a Black-Scholes model incorporating breakpoints upon which each tranche of AeroFlexx equity participates in distributions.

October 2, 2024 December 31, 2024

Volatility 120.00 % 120.00 %

Time to liquidity 2 years 2 years

Discount for lack of marketability 18.00 % 31.00 %

Weighted average cost of capital 45.00 % 45.00 %

Risk-free rate 3.51 % 4.23 %

The fair value of the debt securities is estimated on an as-converted basis using a discounted cash flow model by discounting the contractual debt cash flows at a rate incorporating the credit risk of AeroFlexx as of December 31, 2025 and using a Black-Scholes model as of December 31, 2024 incorporating breakpoints upon which each tranche of AeroFlexx equity participates in distributions.

December 31, 2025 December 31, 2024

Volatility n/a 120 %

Time to liquidity n/a 2 years

Discount for lack of marketability n/a 31.00 %

Weighted average cost of capital n/a 45.00 %

Risk-free rate n/a 4.23 %

AeroFlexx yield 17.01 %

As further discussed in Note 3.

Investments, outstanding principal and accrued interest of $ 7.3 million for the investment in debt securities - AFS was automatically converted into Class D Units in accordance with the loan agreement.

Prior to the conversion, the fair value was estimated using a Black Scholes model.

Post conversion, the fair value is estimated using a discounted cash flow model by discounting the contractual debt cash flows at a rate incorporating the credit risk of AeroFlexx.

Earnout Shares

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The fair value of the Earnout Shares was determined using a Monte Carlo valuation model that utilizes significant assumptions, including expected volatility, expected term, and risk-free rate, to determine the probability of achieving common share price and revenue milestones.

The shares may vest upon either the achievement of the common share price milestone or revenue or event-based milestone specific to each of three tranches.

The shares may vest upon either the achievement of the common share price milestone or revenue or event-based milestones specific to each of three tranches.

Specifically, the future stock price of the Company and revenues of Accelsius and AeroFlexx are simulated assuming a Geometric Brownian Motion (GBM) in a risk-neutral framework.

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Treasury yield curve for time periods approximately equal to the remaining contractual term of the Earnout Shares.

Discounting conventions of revenue-based milestones are mid-period assuming annual revenue forecasts are earned

Discounting conventions of revenue-based milestones are mid-period assuming annual revenue forecasts are earned on average at the mid-period of the forecast period.

The value of the Earnout Shares is calculated as the average present value over all future modeled payoffs.

Innventure, Inc.

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Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

on average at the mid-period of the forecast period.

The value of the Earnout Shares is calculated as the average present value over all future modeled payoffs.

The inputs used in simulating the Company’s stock price include, the term, stock price, volatility, risk-free rate and dividend yield.

Prior to the Business Combination, the Company never paid or declared dividends, thus the dividend yield is estimated to be 0 % as of December 31, 2024.

Prior to the Business Combination, the Company never paid or declared dividends, thus the dividend yield is based on our history and expectation of dividend payouts and is estimated to be 0 % as of December 31, 2025 and 2024.

The following table summarizes the inputs used in simulating the Company’s stock price for purposes of valuing the Earnout Shares:

October 2, 2024 December 31, 2024

December 31, 2025 December 31, 2024

Term 5.8 years 6.8 years

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Risk-free rate 3.77 % 4.42 %

Dividend Yield — % — %

The Milestone One and Milestone Two Earnout Shares are equity classified and the Milestone Three Earnout Shares are liability classified, as further described in Note 10.

Earnout Shares.

The assumptions used in measuring fair value of Milestone One and Milestone Three are considered Level 3 inputs, which include weighted average cost of capital risk premium, operational leverage ratio, revenue risk premium and revenue volatility.

Milestone One

The following table summarizes the unobservable inputs used in estimating the fair value of the Earnout Shares based on revenue for Accelsius (Milestone One):

October 2, 2024

Revenue risk premium 27.80

Revenue volatility

Milestone Two

Milestone Two is contingent on the Company’s formation of a new subsidiary, in partnership with an MNC, as determined using the Innventure LLC's “DownSelect” process, within the Vesting Period.

The probability of achievement based on the Company’s analysis was 98 % on October 2, 2024.

Milestone Three

The following table summarizes the unobservable inputs used in estimating the fair value of the Earnout Shares based on revenue for AeroFlexx (Milestone Three):

October 2, 2024 December 31, 2024

Revenue risk premium 30.60 % 36.10 %

Revenue volatility 165.00 % 176.00 %

The Earnout Shares related to Milestone Three are liability classified, and the Earnout Shares related to Milestone One and Two are equity classified as further described in Note 10.

Earnout Shares.

The assumptions used in measuring fair value of Milestone Three Earnout Shares are considered Level 3 inputs, which include weighted average cost of capital risk premium, operational leverage ratio, revenue risk premium and revenue volatility.

For further information on the Earnout Shares, refer to Note 10.

Earnout Shares.

The Company issued freestanding warrants to the WTI Lenders in connection with the WTI Facility (as defined and further described in Note 5.

In October 2024, The Company issued freestanding warrants (the “2024 WTI Warrants”) to the WTI Lenders in connection with the WTI Facility (as defined and further described in Note 5.

Borrowings and Note 11.

The fair value measurement of 2024 WTI Warrants is based on unobservable inputs (Level 3 fair value measurement).

The fair value of the 2024 WTI Warrants was determined using a Monte Carlo valuation model in which the future stock price is simulated assuming a GBM in a risk-neutral framework.

The model utilizes significant assumptions including stock price, stock price volatility, and credit spread.

The credit spread relates to estimated counterparty credit risk of Innventure being able to make payments related to the WTI Lenders’ put right, in which the 2024 WTI Lenders may exchange the WTI Warrants for a total cash payment of $ 15.0 million after the four-year anniversary of issuance.

The risk-free interest rate was determined by reference to the U.S.

Treasury yield curve.

In April 2025, the Company issued freestanding warrants (the 2025 “WTI Warrants”) to the WTI Lenders in connection with the WTI Facility (as defined and further described in Note 5.

Borrowings and Note 11.

The fair value measurement of 2025 WTI Warrants is based on unobservable inputs (Level 3 fair value measurement).

Innventure, Inc.

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Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The fair value of the WTI Warrants was determined using a Monte Carlo valuation model in which the future stock price is simulated assuming a GBM in a risk-neutral framework.

The initial fair value of the 2025 WTI Warrants was determined using a Monte Carlo valuation model in which the future stock price is simulated assuming a GBM in a risk-neutral framework.

The model utilizes significant assumptions including stock price, stock price volatility and credit spread.

The credit spread relates to estimated counterparty credit risk of Innventure being able to make payments related to the WTI Lenders’ put right, in which the WTI Lenders may exchange the WTI Warrants for a total cash payment of $ 15,000 after the four-year anniversary of issuance.

Specifically, the initial valuation as of the April 14, 2025 issuance date considered a stock price of $ 3.65 , stock price volatility of 57.00 %, and credit spread of 27.70 %.

The risk-free interest rate was determined by reference to the U.S.

Treasury yield curve.

October 22, 2024 December 31, 2024

Stock Price $ 11.50 $ 13.85

The following table summarizes the inputs used in the GBM for purposes of valuing the WTI Warrants as of each year end:

December 31, 2025 December 31, 2024

2025 WTI Warrants:

Geometric Brownian Motion Stock price $

Stock price volatility 60.00

Credit spread 26.00

2024 WTI Warrants:

Geometric Brownian Motion Stock price $

Stock price volatility 60.00

Credit spread 26.00

Significant increases or decreases to any of these inputs would result in a significantly higher or lower liability.

For further information on the 2024 WTI Warrants (as defined below), and 2025 WTI Warrants, refer to Note 11.

Derivative Liabilities

Embedded derivative liabilities contained within the previously issued 8 % convertible promissory notes (the “2025 Notes”) were stated at fair value.

Fair value was determined utilizing discounted cash flows, using unobservable market data inputs, and an option pricing model based on a probability-weighted expected outcome with respect to a financing or a change of control.

The derivatives associated with the 2025 Notes were settled in March 2024 due to conversion of the 2025 Notes in a qualified financing.

A summary of the significant unobservable inputs utilized to estimate the fair value at settlement is as follows:

Embedded derivative within 2025 Notes issued August 18, 2022 with a principal balance of $ 4,000

Discount Rate 35 %

Probability of Expected Outcomes

Financing 100 %

Change in control — %

Embedded derivative within 2025 Notes issued June 7 & July 3, 2023 with an aggregate principal balance of 2,000

Discount Rate 71 % - 87 %

Probability of Expected Outcomes

Financing 100 %

Change in control — %

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

As further discussed and defined in Note 5.

Borrowings, the Company issued Convertible Debentures (as defined below) which contain certain features which qualify as embedded derivates requiring bifurcation.

The fair value of the embedded derivative is determined utilizing a “with and without” method, in which the fair value is calculated as the difference in the fair value of the entire hybrid instrument and the fair value of the instrument excluding the bifurcated derivative features.

The initial fair value of the embedded derivative was determined using a discounted cash flow model as of April 14, 2025 and May 15, 2025 which is reflective of the dates of the Convertible Debenture issuances.

The model uses a significant assumption of a debt yield of 44.5 % for the April 14, 2025 issuance and 42.6 % for the May 15, 2025 issuance.

September 30, 2025

Embedded derivative asset - Convertible Debentures:

Binomial Lattice Model Stock price $

Stock price volatility 60.00

Debt yield 38.70 %

Debt spread 35.00 %

At the time of issuance of the August 2025 Notes (defined below), the related embedded derivative liability had a de minimis fair value.

On September 30, 2025, the Company recognized $ 1,677 for the embedded derivative liability related to the contingent exchange feature.

The fair value was determined using a Black-Scholes valuation model, utilizing inputs related to the risk-free rate, volatility, time to liquidity, and the Accelsius Series B-1 issuance price.

Specifically, the September 30, 2025 valuation considered a risk-free rate of 3.66 %, volatility of 70.00 %, time to liquidity of 4.25 years, and an Accelsius Series B-1 unit issuance price of $ 36.49 .

The derivative associated with the August 2025 notes were settled in October 2025 due to the conversion of the August 2025 Notes in a qualified financing.

Our financial instruments that are not re-measured at fair value include prepaid expenses and other current assets, due from related parties, other assets, accounts payable, accrued expenses, accrued employee benefits, other current liabilities and other liabilities as the carrying amounts approximate fair value due to the short maturity terms of these instruments.

Successor Predecessor

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2025 Interest Rates

December 31, 2024 Interest Rates

Series 1 promissory notes

(in thousands) (in thousands)

Related Party Notes 2024 - 2025

$ — — $ 14,000 8 % - 15.99 %

Series 1 promissory notes

725 12 % - 15 %

Related party notes 2024 - 2025

Related party convertible notes 2025 - 2026

4,331 3.94 % - 15 %

Convertible promissory notes

Convertible debentures 2026 5,572 — % - 5 %

Term convertible notes 2026 7,890 3.94 % —

2028 19,441 13.50 % 20,000 13.50 %

Total Notes Payable

37,356 34,725

unamortized debt discount ( 3,962 ) ( 6,446 )

current portion of related party notes payable — ( 14,000 )

current portion of term convertible note ( 7,890 ) —

current portion of related party term convertible note ( 4,331 ) —

current portion of notes payable ( 12,846 ) ( 625 )

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Discounts on debt are amortized over the contractual life of the related debt instrument using the effective interest method (unless otherwise specified below) and are included in Interest expense, net in the consolidated statements of operations and comprehensive income (loss).

The Company’s notes payable, excluding debt issuance costs, and notes payable to related parties mature as follows:

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Year Ending December 31, Amount

The Company’s notes payable, excluding debt issuance costs, mature as follows (in thousands):

2026 $ 12,846

Total $ 37,356

Series 1 Promissory Notes

In 2018, the Company authorized the issuance and sale of unsecured promissory notes to investors up to $ 35,000 .

From 2018 to 2021, the Company issued promissory notes with a total principal amount of $ 4,936 .

In 2018, the Company authorized the issuance and sale of unsecured promissory notes to investors up to $ 35.0 million (the “Series 1 promissory notes”).

From 2018 to 2021, the Company issued promissory notes with a total principal amount of $ 4.9 million.

The notes require monthly interest payments, have an original maturity period of 36 - 48 months, and bear interest at 9 %- 12 % per annum.

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If the Company elects its second term extension option, the notes will bear interest at 15 % for months 48 through 60 .

In the event of a change of control or a portfolio company sale, the notes are required to be repaid.

In the event of a default, noteholders may elect to convert notes into common units of the Company equal to two times the unpaid principal balance plus accrued but unpaid interest at the time of conversion at a pre-money valuation agreed to by a majority of the converting noteholders.

If the Company is in default due to lack of payment and the noteholders do not elect repayment, notes will accrue interest at the default rate.

During the first 36 months, the default interest rate is 12 % and increases to 18 % thereafter.

Noteholders converted their Series 1 promissory notes into Class B Preferred Units as follows:

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Principal amount

$ — $ 396 $ 1,310

Number of shares

— 40,829 135,133

The conversion rate was based on the Class B Preferred Unit issuance price of $ 9.6992 per unit.

The noteholders elected to receive the last interest payment due and waive the prepayment fee, if applicable, in connection with the transaction.

The Company accounted for the conversion of promissory notes as an extinguishment of debt, the impact of which is immaterial to the Company’s financial statements.

Upon Closing of the Business Combination, the option for noteholders to convert their Series 1 promissory notes into Class B Preferred Units is no longer available.

Extensions on Series 1 promissory notes were as follow:

Successor Predecessor

Interest Rate

Extensions on Series 1 promissory notes were as follows (in thousands):

December 31, 2025 December 31, 2024

Principal amount of 1st extension promissory notes

12 % $ 122 $ 829

Principal amount of 2nd extension promissory notes

15 % $ 603 $ 890

Interest expense on Series 1 promissory notes was as follows:

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Interest expense on Series 1 promissory notes was as follows (in thousands):

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Interest attributable to contractual interest $ 71 $ 29 $ 138

Interest attributable to amortization of issuance costs

Total interest expense $ 29 $ 138 $ 329

Subsequent to December 31, 2025, in January 2026, the company repaid the outstanding balance of the Series 1 promissory notes.

Related Party Notes

The Company entered into unsecured promissory notes with two related parties, the first on August 20, 2024, for a principal amount of $ 10,000 , and the second on August 22, 2024, for a principal amount of $ 2,000 .

The Company entered into unsecured promissory notes with two related parties, the first on August 20, 2024, for a principal amount of $ 10.0 million, and the second on August 22, 2024, for a principal amount of $ 2.0 million.

The Company entered into amended and restated agreements to amend the terms of these unsecured promissory notes on October 1, 2024.

As per the original agreements, the note with the first party contained a loan fee of $ 1,000 which was payable with the repayment of the principal amount of the note and the note with the second party contained interest at the rate of 11.50 % per annum.

The principal amounts, loan fees and accrued interest were repayable at the earlier of October 15, 2024 and the first business day following the date of consummation of the Business Combination.

As per the amended note with the first party, the maturity date was extended to the earlier of (i) January 31, 2025 and (ii) the first business day following the date on which the Company has sufficient capital to be able to repay all amounts outstanding under the note and otherwise meet its expected working capital needs as determined by the Company in its reasonable discretion.

The loan fee of $ 1,000 , required under the original agreement, became due on or around the amendment date but as of December 31, 2024 has not yet been paid and interest will accrue at the rate of 15.99 % per annum until paid.

As per the original agreements, the note with the first party contained a loan fee of $ 1.0 million which was payable with the repayment of the principal amount of the note and the note with the second party contained interest at the rate of 11.50 % per annum.

As per the amended note with the first party, the maturity date was extended to the earlier of (i) January 31, 2025 or (ii) the first business day following the date on which the Company has sufficient capital to be able to repay all amounts outstanding under the note and otherwise meet its expected working capital needs as determined by the Company in its reasonable discretion.

The loan fee of $ 1.0 million, required under the original agreement, became due on or around the amendment date and interest will accrue at the rate of 15.99 % per annum until paid.

The amendment was accounted for as a troubled debt restructuring as the Company was provided a concession through a decrease in the effective interest rate.

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As per the amended note with the second party, the maturity date was extended to January 31, 2025 and the interest rate was increased to 13.50 % per annum.

Additionally, $ 1,000 of the principal amount became due on or around the amendment date but as of December 31, 2024 has not yet been paid.

Interest expense on the related party notes was as follows:

Additionally, $ 1.0 million of the principal amount became due on or around the amendment date.

Interest expense on the related party notes was as follows (in thousands):

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Total interest expense $ 419 $ 611 $ 932

In addition to the related party notes above, the Company also has a related party note for $ 1,000 that had no stated interest or maturity at issuance.

The Company formally came to terms on the related party note by executing an unsecured promissory note with the related party on May 2, 2024.

As per the terms of the executed agreement, the principal amount became due on December 21, 2024 but as of December 31, 2024 has not yet been paid and interest will now accrue at the rate of 8.00 % per annum.

Upon maturity, the Company is required to repay the outstanding principal amount of $ 1,000 and a loan fee equal to approximately $ 63 .

There is no stated interest as per the terms of the executed agreement but it provides for interest at the rate of 8.00 % per annum on the outstanding amount from the maturity date if the Company fails to pay any amount due on the maturity date.

In addition to the related party notes above, the Company also had a related party note for $ 1.0 million through an unsecured promissory note with an additional related party dated May 2, 2024.

As per the terms of the executed agreement, the principal amount became due on December 21, 2024 and interest will accrue at the rate of 8.00 % per annum.

Upon maturity, the Company is required to repay the outstanding principal amount of $ 1.0 million and a loan fee equal to approximately $ 0.1 million.

On March 20, 2025, in connection with the issuance of Series C Preferred Stock (as defined below), the Company extinguished the outstanding amount of related party notes.

The Company recognized a loss $ 3.5 million in Loss on extinguishment of related party debt on the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2025.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Convertible Promissory Notes

The Company previously issued 8 % convertible promissory notes (the “2025 Notes”) that can be converted into equity units at the later of a qualified financing event or upon maturity, which is 36 -months.

A qualified financing event is one or more transactions that results in gross proceeds of at least $ 2,000 .

Upon the occurrence of a qualified financing event, the 2025 Notes convert to the series of stock issued in that financing at the lesser of (a) a 20 percent discount or (b) $ 200 million divided by the number of fully diluted units outstanding immediately prior to the financing.

This conversion option is accounted for as a derivative instrument and the fair value of such is discussed in Note 4.

On March 31, 2024, the 2025 Notes with a $ 6,000 principal balance and $ 755 of accrued interest were converted into 693,480 Accelsius Series A units at a conversion price of $ 9.74 per share.

The conversion was pursuant to the occurrence of a qualified financing event.

The related embedded derivative liability was extinguished in connection with the conversion, resulting in a loss on conversion of $ 1,119 recorded on the consolidated statements of operations and comprehensive income (loss) in the Predecessor period from January 1, 2024 through October 1, 2024.

Interest expense on the 2025 Notes was as follows:

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Interest attributable to contractual interest $ — $ 120 $ 583

Interest attributable to amortization of implied discounts

Total interest expense $ — $ 351 $ 1,039

The Company has accrued interest of $ — and $ 634 in convertible promissory notes as of December 31, 2024 and 2023, respectively.

As of December 31, 2024 and 2023, the unamortized discount was $ — and $ 2,133 , respectively.

On October 22, 2024, the Company entered into a term loan with WTI Fund X, Inc.

and WTI Fund XI, Inc., (collectively, “WTI Lenders”).

The terms of the loan provides for a term loan facility in the aggregate principal amount of up to $ 50,000 (the "WTI Facility"), of which (i) up to $ 20,000 is made available after October 22, 2024 and through November 15, 2024 (the "First Tranche");

(ii) up to $ 15,000 is made available after November 1, 2024 and through November 30, 2024 (the "Second Tranche");

and (iii) up to $ 15,000 will be made available after December 31, 2024 and through January 31, 2025 (the "Third Tranche") (provided that up to $ 7,500 of the Third Tranche will be made available until March 31, 2025), in each case, subject to the satisfaction of certain conditions, including, with respect to each of the Second Tranche and the Third Tranche, satisfaction of certain financial conditions and the WTI Lenders’ satisfaction with the Company’s forward-looking plan at such time.

Borrowings under the WTI Facility will accrue interest at a rate per annum equal to the greater of (i) the “prime rate” of interest, as published by The Wall Street Journal on the date that the WTI Lenders prepare the promissory notes for the borrowings under such tranche, plus 5 % and (ii) 13.50 % and will amortize, after an interest-only period of twelve months in the case of the First Tranche and six months in the case of each of the Second Tranche and the Third Tranche, in equal monthly installments over a period of thirty months .

Obligations are secured by a lien on the majority of the assets of Innventure LLC and Innventure, Inc.

The Company received all $ 20,000 of the First Tranche on November 15, 2024.

The terms of the loan provides for a term loan facility in the aggregate principal amount of up to $ 50.0 million (the "WTI Facility").

The total aggregate principal was available in three separate tranches subject to the Company meeting certain conditions.

The Company received $ 20.0 million (the “First Tranche”) on November 15, 2024.

The First Tranche, principal and interest, shall be repaid over a period of 30 months in equal, monthly installments, commencing after an initial 12 -month period of interest-only monthly payments, resulting in a total term of 42 months.

The interest rate on the

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

outstanding principal amounts under the WTI Facility for the Successor period ended December 31, 2024 was 13.50 %.

In connection with the WTI Facility, the Company issued WTI Warrants to the WTI Lenders (as further defined and described in Note 11.

The funds under each of the Second Tranche and the Third Tranche are no longer available to the Company.

Borrowings under the WTI Facility will accrue interest at a rate per annum equal to the greater of (i) the “prime rate” of interest, as published by The Wall Street Journal on the date that the WTI Lenders prepare the promissory notes for the borrowings under such tranche, plus 5 % and (ii) 13.50 % and will amortize, after an interest-only period of twelve months in the case of the First Tranche in equal monthly installments over a period of thirty months .

Obligations are secured by a lien on the majority of the assets of Innventure LLC and Innventure, Inc.

On March 21, 2025, in connection with the issuance of the first tranche of Convertible Debentures (as further described below) to Yorkville, the Company and Innventure LLC entered into a consent (the “Consent”) with WTI Fund X, LLC and WTI Fund XI, LLC (the “WTI Holders”) and the WTI Lenders, modifying the WTI Facility.

Specifically, under the Consent, the Company and the WTI Lenders and WTI Holders agreed (i) that from and after the date that the Company receives the initial proceeds from the Convertible Debentures and until such time as such obligations have been paid in full, the Company must maintain at least $ 5.0 million of cash on deposit;

(ii) that effective on the date that the Company receives the initial proceeds from the Convertible Debentures, the 2025 WTI Warrants (as further defined and described in Note 11.

Warrants) will become payable to the WTI Lenders and their affiliates;

and (iii) to certain additional consent provisions.

Such provisions from the Consent became effective on April 14, 2025 when the Company received proceeds from the Convertible Debentures.

The modification of the WTI Facility was accounted for as an extinguishment of debt though the WTI Facility remains outstanding, resulting in a loss on extinguishment of $ 3.5 million recorded on the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2025.

The legal requirement to maintain at least $ 5.0 million of cash on deposit is presented as Restricted cash on the consolidated balance sheets.

In connection with the WTI Facility, the Company issued the 2024 WTI Warrants and the 2025 WTI Warrants (collectively the “WTI Warrants”) to the WTI Lenders (as further defined and described in Note 11.

The Company accounted for each of the WTI Warrants as detachable warrants at their fair value.

The fair value of the WTI Warrants was recorded as a liability and as a discount to the WTI Facility on the consolidated balance sheets.

The WTI Warrants are classified as a liability in accordance with ASC 480, as they represent an instrument that is not an outstanding share and may require the issuer to settle the obligation by transferring assets, specifically cash.

The Company is amortizing the discount over the term of the WTI Facility using the straight-line method.

On October 22, 2024, when the Company entered into the WTI Facility, the Company recognized $ 16,735 as a commitment fee asset on the consolidated balance sheets.

On November 15, 2024, when the Company received the First Tranche in the amount of $ 20,000 , the prorated portion of the commitment fee asset of $ 6,694 was reclassified to a debt issuance cost within Notes payable, net of current portion and began amortizing over the term of the First Tranche.

On November 30, 2024 and December 31, 2024, management determined that the Second and Third Tranche, respectively, could not be drawn upon due to certain operational thresholds which had not been met for these Tranches.

Therefore, the Company wrote off $ 5,021 and $ 5,021 , respectively on these dates, to Write-off of loan commitment fee asset on the consolidated statements of operations and comprehensive income (loss) as the commitment fee asset could no longer benefit the Company in receiving debt financing capital.

Interest expense on this facility was as follows:

Interest expense on the WTI facility was as follows (in thousands):

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Interest attributable to contractual interest $ 2,738 $ 352 $ —

Interest attributable to amortization of issuance costs and discounts

Total interest expense $ 4,849 $ 600 $ —

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Convertible Debentures

On March 25, 2025, the Company entered into a securities purchase agreement (“Existing Purchase Agreement”) with Yorkville related to the issuance and sale of convertible debentures (“Existing Convertible Debentures” collectively with the New Convertible Debentures defined below, the “Convertible Debentures”) with an aggregate principal amount of up to $ 30.0 million.

The Existing Convertible Debentures are convertible into shares of Common Stock and contain certain features that represent embedded derivatives, which are bifurcated and included within Prepaid expenses and other current assets on the consolidated balance sheets.

The Company issued the aggregate principal amount of the Existing Convertible Debentures in two tranches tied to separate reporting and filing requirements.

On April 14, 2025, the Company issued the first tranche of the Existing Convertible Debentures with a principal amount of $ 20.0 million, resulting in cash proceeds to the Company of $ 18.0 million, representing an original issue discount of 10 %.

The first tranche was scheduled to be repaid in twelve monthly payments with a 5 % payment premium due to the lender with each payment.

Also on April 14, 2025, the Company issued two warrants (the “2025 WTI Warrants”) to purchase, at a price of $ 0.01 per share (subject to certain limitations and adjustment), up to an aggregate total of 495,074 shares of Common Stock, as of the date of issuance and December 31, 2025 (subject to future adjustments to the number and type of shares pursuant to the 2025 WTI Warrants), to the WTI Holders.

Each of the 2025 WTI Warrants is exercisable through March 31, 2035.

On May 15, 2025, the Company issued the second tranche of the Existing Convertible Debentures with a principal amount of $ 10.0 million, resulting in cash proceeds to the Company of $ 9.0 million, representing an original issue discount of 10 %.

The second tranche was scheduled to be repaid in eleven monthly payments with a 5 % payment premium due to the lender with each payment.

There is no contractual interest associated with amounts outstanding for the Existing Convertible Debentures for the year ended December 31, 2025.

On September 15, 2025, the Company entered into an additional amendment to the Existing Purchase Agreement for the Existing Convertible Debentures (the “September 2025 Amendment”).

Pursuant to the September 2025 Amendment, the Company and Yorkville agreed to amend the definition of conversion price so that the fixed price of $ 10.00 was reduced to $ 7.00 and a floor price of $ 1.59 was implemented.

Additionally, the monthly payments applicable to the Existing Convertible Debentures were removed and replaced with repayment due upon maturity in connection with the early repayment of the approximately $ 2.0 million.

The payment premium on this payment was waived.

However, payments and related payment premiums resume should the Innventure stock price fall below the floor price, the Company issues in excess of 99 % of Common Stock under the exchange cap or Yorkville is unable to utilize a registration statement to resell shares of Common Stock.

On September 15, 2025, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Yorkville for up to $ 15.0 million in convertible debentures (“New Convertible Debentures”), issuable in two tranches.

The first tranche of $ 10.0 million was issued with a 10 % original issue discount, yielding $ 9.0 million in net proceeds, and bears 5 % annual interest, with repayment due September 15, 2026.

The debentures are convertible into Common Stock and contain certain features that represent embedded derivatives which are bifurcated and included within Prepaid expenses and other current assets on the condensed consolidated balance sheets.

On November 12, 2025, the Company issued the second tranche of the New Convertible Debentures for $ 5.0 million.

The debentures were issued with a 10 % original issue discount, yielding $ 4.5 million in net proceeds, bear 5 % annual interest, and mature on September 15, 2026.

The September 2025 Amendment and first and second tranche of the New Convertible Debentures were accounted for collectively as a troubled debt restructuring.

The Company determined that a concession was provided based on a decrease in the effective interest rate when compared to the original terms of the Existing Convertible Debentures.

Under the troubled debt restructuring a loss on extinguishment of debt of $ 12.6 million was recorded on the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2025.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

During the year ended December 31, 2025, the Company issued 997,573 shares of its Common Stock pursuant to the SEPA in payment of $ 4.9 million of principal and $ 0.2 million of payment premium for the Convertible Debentures.

Also, the Company issued 10,005,859 shares of Common Stock due to the exercise of conversion option by Yorkville for a principal amount of $ 30.7 million of the Convertible Debentures.

For further information on this conversion, see Note 13.

Stockholders' Equity.

During the year ended December 31, 2025 the Company made cash payments toward the Convertible Debentures totaling $ 3.4 million of principal and $ 0.1 million of payment premium.

Subsequent to December 31, 2025, on January 27, 2026, the Company issued 304,377 shares of Common Stock due to the exercise of conversion option by Yorkville for a principal amount of $ 1.0 million of the Convertible Debentures.

Additionally, we made a cash payment of $ 5.5 million inclusive of principal, interest and fees, satisfying the Convertible Debentures in full.

Interest expense on the Convertible Debentures was as follows (in thousands):

Successor Predecessor

Year Ended December 31, 2025 Period from October 2, 2024 through December 31, 2024 Period from January 1 2024 through October 1, 2024

Interest attributable to contractual interest $ 231 $ — $ —

Interest attributable to amortization of issuance costs

Total interest expense $ 4,510 $ — $ —

Term Convertible Notes

At various dates in June and July of 2025, Accelsius entered into unsecured convertible notes with various other parties (the “Term Convertible Notes”) for a total principal amount of $ 7.8 million.

The Term Convertible Notes have a stated maturity date of December 31, 2026 and bear interest at the annual applicable federal rate published by the Internal Revenue Service.

The Term Convertible Notes, which are subordinated to the WTI Facility, are convertible at the option of the lenders, starting January 2, 2026, for all amounts due under the notes at the time of conversion, into Accelsius’ Series A Units at a price per unit equal to $ 12.18 .

For as long as any portion of the WTI Facility remains outstanding, the lenders will not demand payment related to this Term Convertible Notes, unless they convert the debt into equity.

The interest expense on the Term Convertible Notes was $ 0.2 million for the year ended December 31, 2025.

Related Party Convertible Notes

On June 26, 2025, Accelsius entered into an unsecured Convertible Promissory Note (“CPN”) with a related party lender.

The maximum principal amount under the CPN is $ 3.0 million, issuable in three equal draws, upon the request of Accelsius and subject to the related party’s sole discretion.

On June 27, 2025, Accelsius received the first $ 1.0 million draw and on July 24, 2025 received the second $ 1.0 million draw.

The CPN had a stated interest rate of 15 % and Accelsius was required to pay an immaterial loan fee (“Loan Fee”) upon maturity, repayment or conversion of this note.

On October 8, 2025, the Company repaid the CPN in full due to its related party, amounting to $ 2.0 million in principal and $ 0.1 million in interest and loan fees, for a total of $ 2.1 million.

The CPN was convertible at the option of the related party lender for all amounts due under the Convertible Note, including the Loan Fee, into either preferred units of Accelsius at a price equal to 80 % of the next funding round price if Accelsius raises at least $ 5.0 million from unaffiliated investors, or into common units of Accelsius, if no such funding round occurs before the maturity date, with unit pricing of common units determined by an independent valuation firm.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

In June of 2025, Accelsius also entered into unsecured convertible notes (“Related Party Term Convertible Notes”, together with the CPN, the “Related Party Convertible Notes”) with certain investors deemed to be Related Parties (as defined in the Company’s Related Party Transactions Policy) for a total principal amount of $ 4.2 million.

The Related Party Term Convertible Notes have a stated maturity date of December 31, 2026 and bear interest at the annual applicable federal rate published by the Internal Revenue Service.

The Related Party Term Convertible Notes, which are subordinated to the WTI Facility, are convertible at the option of the lenders, starting January 2, 2026, for all amounts due under the notes at the time of conversion, into Accelsius’ Series A Units at a price per unit equal to $ 12.18 .

For as long as any portion of the WTI Facility remains outstanding, the Related Party Term Convertible Notes lenders will not demand payment related to the Related Party Term Convertible Notes, unless they convert the debt into equity.

The interest expense on Related Party Convertible Notes, including the amortization of the loan fee, was $ 0.2 million for the year ended December 31, 2025.

August 2025 Notes

Between August 12, 2025 and September 19, 2025, Accelsius issued unsecured convertible promissory notes (the “August 2025 Notes”) totaling $ 9.2 million in principal, with $ 7.3 million in proceeds received by December 31, 2025.

The notes bear interest at 6.5 % annually, are repayable upon demand after two years and are subordinate to existing senior debt.

Upon the Company’s next preferred equity round raising at least $ 5.0 million from unaffiliated investors, the notes will automatically convert into preferred units at 80 % of the unit price, with accompanying warrants exercisable for 0.5 units at 120 % of the unit price.

On October 2, 2025, the August 2025 Notes were converted into 251,452 Series B-2 units.

For further information on this conversion, see Note 13.

Stockholders' Equity.

The August 2025 Notes are subordinate to the WTI Facility, Convertible Debentures, Term Convertible Notes and indebtedness of Accelsius owed to Innventure LLC and for as long as any portion of these senior debts remains outstanding, the lenders will not demand payment related to this August 2025 Notes, unless they convert the debt into equity.

The interest expense on the August 2025 Notes was immaterial for the December 31, 2025.

Convertible Promissory Notes

Accelsius previously issued 8 % convertible promissory notes (the “2025 Notes”) that can be converted into equity units at the later of a qualified financing event or upon maturity, which is 36 -months.

A qualified financing event is one or more transactions that results in gross proceeds of at least $ 2.0 million.

Upon the occurrence of a qualified financing event, the 2025 Notes convert to the series of stock issued in that financing at the lesser of (a) a 20 % discount or (b) $ 200.0 million divided by the number of fully diluted units outstanding immediately prior to the financing.

This conversion option is accounted for as a derivative instrument and the fair value of such is discussed in Note 4.

On March 31, 2024, the 2025 Notes with a $ 6.0 million principal balance and $ 0.8 million of accrued interest were converted into 693,480 Accelsius Series A units at a conversion price of $ 9.74 per share.

The conversion was pursuant to the occurrence of a qualified financing event.

The related embedded derivative liability was extinguished in connection with the conversion, resulting in a loss on conversion of $ 1.1 million recorded on the consolidated statements of operations and comprehensive income (loss) in the Predecessor period from January 1, 2024 through October 1, 2024.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Interest expense on the 2025 Notes was as follows (in thousands):

Successor Predecessor

Year Ended December 31, 2025 Period from October 2, 2024 through December 31, 2024 Period from January 1, 2024 through October 1, 2024

Interest attributable to contractual interest $ — $ — $ 120

Interest attributable to amortization of implied discounts — — 231

Total interest expense $ — $ — $ 351

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Inventories, net

December 31, 2025 December 31, 2024

(in thousands)

Raw materials $ 667 $ 2,974

5 unchanged sentences

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Property, Plant and Equipment

Successor Predecessor

December 31, 2025 December 31, 2024

(in thousands)

Leasehold improvements $ 960 $ 548

6 unchanged sentences

$ 1,941 $ 1,414

Total depreciation expense on property, plant and equipment was as follows:

Total depreciation expense on property, plant and equipment was as follows (in thousands):

Successor Predecessor

Period from October 2, 2024 through December 31, 2024 Period from January 1 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 Period from October 2, 2024 through December 31, 2024 Period from January 1 2024 through October 1, 2024

Depreciation Expense $ 891 $ 78 $ 148

Business Combinations

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Business Combination

As discussed in Note 1.

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Consideration Transferred

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Class I Units (such holders, the “Innventure Members”), consisted of 43,494,999 shares of Common Stock.

The aggregate consideration for the Business Combination (the “Purchase Consideration”) paid to the holders of Innventure LLC’s outstanding equity and profits interests and warrants, other than the Class PCTA Units and the Class I Units (such holders, the “Innventure Members”), consisted of 43,494,999 shares of Common Stock.

A portion of this Purchase Consideration to be delivered to Innventure Members consists of a contingent right to receive up to 5,000,000 (the “Company Earnout Shares”) shares of Common Stock.

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As of the Closing, the Innventure Members owned approximately 88.3 % of the Company’s outstanding shares of Common Stock and the former shareholders of Learn CW, including (i) Learn CW's sponsor, CWAM LC Sponsor LLC (the “Sponsor”) and (ii) Learn CW's independent directors, owned approximately 13.7 % of the Company’s outstanding shares of Common Stock.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

The number of shares of Common Stock issued and outstanding at the Closing of the Business Combination were:

1 unchanged sentence

Class B Preferred Units

2.09 22,754,664

Class B-1 Preferred Units

2.09 11,738,165

Class A Units

Class C Units

Total 18,397,684 38,494,999

2.09 3,285,303

Learn CW Shares

Learn CW Public shareholders 1,027,674

1.00 1,027,674

Learn CW Class B Shareholders 5,000,000

1.00 5,000,000

Total 6,027,674

1 unchanged sentence

Total Common Stock Issued and Outstanding at Closing 43,589,850

The consideration transferred for the Business Combination is summarized as follows:

The consideration transferred for the Business Combination is summarized as follows (in thousands):

Holdco Common Stock transferred to Innventure Members (1)

10 unchanged sentences

Significant inputs used to measure the fair value of the non-controlling interest include the long-term growth rate of 3.0 %, normalized tax rate of 27.9 %, normalized net working capital of 18.0 %, and weighted average cost of capital of 17.6 %.

Investing cash flow activity as a result of the Business Combination is summarized as follows:

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Investing cash flow activity as a result of the Business Combination is summarized as follows (in thousands):

Cash consideration transferred $ —

1 unchanged sentence

Investing cash flow activity as a result of the Business Combination $ 16

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

On the Closing Date, Innventure settled certain obligations using cash from the Learn CW trust account that was released at Closing and financing secured through Series B Preferred Stock.

1 unchanged sentence

Stockholders' Equity.

(in thousands)

Cash proceeds from Learn CW trust account $ 11,342

9 unchanged sentences

The total purchase price was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values on the acquisition date.

The purchase consideration was allocated to the following assets and liabilities:

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The purchase consideration was allocated to the following assets and liabilities (in thousands):

Assets acquired:

2 unchanged sentences

Due from related parties

Inventory 2,824

Prepaid expenses and other current assets

3 unchanged sentences

Intangible assets

Other assets 829

Total assets acquired:

11 unchanged sentences

Goodwill $ 667,936

The assessment of fair value is preliminary and is based on information that was available to management and through the end of the fiscal year.

If additional information of events or circumstances that existed at Closing becomes available to management related to assets acquired or liabilities assumed subsequent to this preliminary assessment of fair value but not later than one year after Closing, measurement period adjustments will be recorded in the period in which they are determined, as if they had been completed at the Closing Date.

The assessment of fair value is based on information that was available to management that existed at Closing but not later than one year after Closing.

Goodwill is recognized as the excess of consideration over the net assets acquired of Innventure LLC and represents the value derived by Innventure LLC’s strong market position and assembled workforce.

Goodwill arising from the Business Combination is attributable to the Company’s Technology segment and is not deductible for tax purposes.

The fair value of definite-lived intangible assets as of the Closing Date included:

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The fair value of definite-lived intangible assets as of the Closing Date included (in thousands):

Trade names $ 17,800

4 unchanged sentences

Goodwill and Intangible Assets for additional information.

The Predecessor financial statements for the year ended December 31, 2023, include $ 3,452 transaction costs from Innventure LLC and for the period from January 1, 2024 to October 1, 2024 include $ 9,627 of transaction costs from Innventure LLC.

The Predecessor financial statements for the period from January 1, 2024 to October 1, 2024 include $ 9.6 million of transaction costs from Innventure LLC.

These transaction costs are recorded within General and administrative expenses within the consolidated statements of operations and comprehensive income (loss).

Prior to the Closing Date, Learn CW incurred $ 9,233 of transaction costs related to the Business Combination, which are not reported in the Predecessor consolidated statements of operations and comprehensive income (loss) since Learn CW is not the Predecessor;

Prior to the Closing Date, Learn CW incurred $ 9.2 million of transaction costs related to the Business Combination, which are not reported in the Predecessor consolidated statements of operations and comprehensive income (loss) since Learn CW is not the Predecessor;

these transaction costs are included within Accumulated deficit for the Successor period beginning October 2, 2024.

Innventure LLC contributed revenues of $ 455 and net loss of $ 18,333 in the consolidated statements of operations and comprehensive income (loss) for the Successor period from October 2, 2024 through December 31, 2024.

Innventure LLC contributed revenues of $ 0.5 million and net loss of $ 18.3 million in the consolidated statements of operations and comprehensive income (loss) for the Successor period from October 2, 2024 through December 31, 2024.

Innventure LLC incurred certain acquiree expenses contingent solely upon the consummation of the Business Combination.

Such costs consisted of $ 5,292 in transaction costs and $ 223 of expense related to share-based award accelerated vesting.

Such costs consisted of $ 5.3 million in transaction costs and $ 0.2 million of expense related to share-based award accelerated vesting.

Such costs are presented “on the line” and are not reflected in either Predecessor or Successor financial statement periods.

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The unaudited pro forma results reflect the step-up amortization adjustments for the fair value of intangible assets acquired, transaction expenses, public warrant reclass from liabilities to equity, removal of Learn CW investment income, and accelerated vesting of equity-based compensation.

The amounts of revenue for the years ended December 31, 2024 and 2023 are $ 1,219 and $ 1,117 , respectively.

The amounts of net loss for the years ended December 31, 2024 and 2023 are $ 105,972 and $ 74,165 , respectively.

The amounts of revenue for the year ended December 31, 2024 was $ 1.2 million.

The amount of net loss for the year ended December 31, 2024 was $ 106.0 million.

Goodwill and Intangible Assets

There was no goodwill on the consolidated balance sheets during the Predecessor periods.

For the Successor period from October 2, 2024 through December 31, 2024, there was $ 667,936 of goodwill recognized in connection with the Business Combination and no change to this value as of December 31, 2024.

Refer to Note 8.

Business Combinations for details.

The following table summarizes intangible assets, net:

(in thousands)

Balance as of December 31, 2024 $ 667,936

Impairment ( 346,557 )

Balance as of December 31, 2025

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

December 31, 2024 (Successor)

Intangible Asset Weighted-Average Amortization Period (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount

In addition to annual impairment testing of goodwill, which is performed in the fourth quarter of each fiscal year, the Company continuously monitors for events and circumstances that could negatively impact the key assumptions used in determining fair value and therefore would require interim impairment testing, including long-term revenue growth projections, profitability, discount rates, volatility in the Company's market capitalization and general industry, market and macroeconomic conditions.

During the year ended December 31, 2025, the Company recorded $ 346.6 million in non-deductible, non-cash goodwill impairment charges, within the consolidated statements of operations and comprehensive income (loss) due to sustained decreases in the Company’s publicly quoted share price and market capitalization, which were, at least in part, sensitive to the general downward volatility experienced in the stock market in late February 2025 through April 2025.

The Company’s annual fourth quarter, June 30, 2025 and March 31, 2025 goodwill impairment testing was performed using the income approach via a discounted cash flow model.

The income approach estimates fair value by converting future cash flows to a current amount on the measurement date after taking into consideration marketplace conditions.

Assumptions including discount rate and estimated future cash flows had a significant impact to the estimated fair value of the reporting unit.

These fair values are Level 3 assets in the fair value hierarchy.

In the event there are further adverse changes in the Company’s projected cash flows or further changes in key assumptions, including but not limited to an increase in the discount rate and further decline in the Company’s stock price, the Company may be required to record additional non-cash impairment charges to goodwill.

Such non-cash charges could have a material adverse effect on the Company’s consolidated statements of operations and comprehensive income (loss) and consolidated balance sheets in the reporting period of the charge.

Other intangible assets, net

December 31, 2025 December 31, 2024

Intangible Asset Weighted-Average Amortization Period Remaining (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount

(in thousands)

Trade names 14.8 $ 17,800 $ ( 1,390 ) $ 16,410 $ 17,800 $ ( 277 ) $ 17,523

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Total intangible assets $ 187,530 $ ( 26,993 ) $ 160,537 $ 187,530 $ ( 5,377 ) $ 182,153

There were no intangible assets on the consolidated balance sheets during the Predecessor periods;

therefore, no amortization expense was recognized.

Amortization expense was $ 5,377 for the Successor period from October 2, 2024 through December 31, 2024 and is recorded on the consolidated statements of operations and comprehensive income (loss).

Estimated future amortization expense is as follows:

Amortization expense of $ 21.6 million and $ 5.4 million was recognized for the years ended December 31, 2025 and for the successor period October, 2 2024 through December 31, 2024, respectively, and is recorded within Cost of sales, General and administrative and Research and development on the consolidated statements of operations and comprehensive income (loss).

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Estimated future amortization expense is as follows (in thousands):

Amortization Expense

2 unchanged sentences

Total $ 160,537

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Earnout Shares

4 unchanged sentences

The Earnout Shares will vest upon the following milestone conditions:

• 40 % of the Earnout Shares will vest upon Accelsius having entered into binding contracts providing for revenue for the Company (as defined in the Business Combination Agreement) within 7 years following the Closing (the “Vesting Period”) in excess of $ 15,000 in revenue ("Milestone One");

• 40 % of the Earnout Shares will vest upon the Company’s formation of a new subsidiary, in partnership with an MNC, as determined using the Innventure LLC's “DownSelect” process, within the Vesting Period ("Milestone Two");

• 20 % of the Earnout Shares will vest upon AeroFlexx having received in excess of $ 15,000 revenue within the Vesting Period ("Milestone Three").

• 20 % of the Earnout Shares will vest upon AeroFlexx having received in excess of $ 15.0 million in revenue within the Vesting Period ("Milestone Three").

The Sponsor Earnout Shares have a vesting provision that occurs upon a change of control event or upon the occurrence of the VWAP of the shares of Innventure, Inc.

1 unchanged sentence

These vesting conditions are not effective on the Company Earnout shares until 6 months following the Business Combination.

The Earnout Shares related to Milestone One and Milestone Two were determined to be classified as equity.

At Closing, 4,275,862 equity-classified Earnout Shares were fair valued at $ 46.4 million, inclusive of 2,137,931 Milestone One shares fair valued at $ 23.2 million and 2,137,931 Milestone Two shares fair valued at $ 23.2 million which are presented in Additional paid-in capital on the consolidated balance sheets at December 31, 2024.

On January 7, 2025, a total of 344,828 Sponsor Earnout Shares fully vested and were no longer subject to contingencies as the Company’s public stock price had surpassed $ 11.50 for twenty consecutive days, thereby fulfilling the vesting provision for the Sponsor Earnout Shares.

These vesting conditions were not effective on the Company Earnout Shares until 6 months following the Business Combination.

On January 8, 2025, the Company’s Board of Directors formally recognized the creation of the Refinity subsidiary, thereby meeting the Milestone Two conditions for the Company Earnout Shares.

As such, 2,000,000 shares of Common Stock were issued on February 4, 2025 as a result of the satisfaction of the respective milestone.

The Earnout Shares related to Milestone Three are classified as a liability.

There were 1,000,000 and 1,068,966 liability-classified Earnout Shares fair valued at $ 3.9 million and $ 14.8 million as of December 31, 2025 and 2024, respectively.

The Company recognized losses of $ 10.0 million and $ 3.4 million in Change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2025 and for the successor period October 2, 2024 through December 31, 2024, respectively.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The Earnout Shares related to Milestone One and Milestone Two were determined to be classified as equity.

At Closing, 4,275,862 equity-classified Earnout Shares were fair valued at $ 46,350 , inclusive of 2,137,931 Milestone One shares fair valued at $ 23,175 and 2,137,931 Milestone Two shares fair valued at $ 23,175 which are presented in Additional paid-in capital on the consolidated balance sheets.

The Earnout Shares related to Milestone Three are classified as a liability.

At Closing, 1,068,966 liability-classified Earnout Shares were fair valued at $ 11,352 and subsequently fair valued at $ 14,752 as of December 31, 2024.

The Company recognized a loss of $ 3,400 in Change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss) for the Successor period from October 2, 2024 through December 31, 2024.

Number of Public Warrants Number of Private Warrants Number of WTI Warrants

Number of Public Warrants Number of Private Warrants Number of 2024 WTI Warrants Number of 2025 WTI Warrants

Outstanding, October 2, 2024 (Successor) 11,499,997 7,146,000 — —

Exercised ( 259,309 ) — — —

Outstanding, December 31, 2024 (Successor) 11,240,688 7,146,000 2

There were no warrants outstanding during the Predecessor period from January 1, 2024 through October 1, 2024 nor the Predecessor year ended December 31, 2023.

Issued — — 2 —

Outstanding, December 31, 2024 11,240,688 7,146,000 2 —

Exercised — — — —

Issued — — — 2

Outstanding, December 31, 2025

11,240,688 7,146,000 2 2

Public and Private Placement Warrants

Upon the consummation of the Business Combination, 11,499,997 Learn CW public warrants and 7,146,000 private placement warrants outstanding immediately prior to Closing was assumed by the Company and each converted into Company warrant ("Warrant").

All references to “Class A ordinary shares” of Learn CW in Learn CW’s prior agreement were amended to shares of Common Stock of the Company.

7 unchanged sentences

As such, the public warrants are measured at fair value at Closing using the warrant price at Closing multiplied by the number of public warrants and will not be subsequently re-measured.

At Closing, the fair value of the equity classified public warrants was $ 1,265 and is presented in the consolidated balance sheets.

As of the Closing date the fair value of the equity classified public warrants was $ 1.3 million and is presented in the consolidated balance sheets.

Fair Value for details on valuation.

The public warrants expire on October 2, 2029.

During the Successor period from October 2, 2024 through December 31, 2024, 259,309 public warrants were exercised.

Each public warrant that was exercised was converted into one share of Common Stock for an exercise price of $ 11.50 , amounting to a total of $ 2,982 cash proceeds.

For the successor period October 2, 2024 through December 31, 2024, 259,309 public warrants were exercised.

Each public warrant that was exercised was converted into one share of Common Stock for an exercise price of $ 11.50 , amounting to a total of $ 3.0 million in cash proceeds.

Private Placement Warrants

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The private placement warrants are liability classified and are not eligible for an exception from derivative accounting.

1 unchanged sentence

The private placement warrants are measured at fair value based on the price of the public warrants (Level 2 fair value measurement).

As of Closing and December 31, 2024, the fair value of the liability-classified private placement warrants is $ 786 and $ 16,793 , respectively, and is presented in the consolidated balance sheets.

For the Successor period from October 2, 2024 through December 31, 2024, the company recognized a loss of $ 16,007 in Change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss).

There were no private warrants exercised for the year ended December 31, 2024.

December 31, 2024

Number of Warrants Exercise Price Expiration Date Balance

Private Warrants 7,146,000 $ 11.50 10/2/2029 $ 16,793

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

The private placement warrants will expire on October 2, 2029 or earlier upon redemption or liquidation and are exercisable for $ 11.50 per share.

As of December 31, 2025 and December 31, 2024, the fair value of the private placement warrants is $ 11.1 million and $ 16.8 million, respectively, and is presented as a current liability in the consolidated balance sheets.

For the years ended December 31, 2025 and for the successor period October 2, 2024 through December 31, 2024, the Company recognized losses of $ 5.6 million and $ 16.0 million, respectively, in Change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss).

On October 22, 2024, in connection with the WTI Facility, the Company issued warrants (the "2024 WTI Warrants") to the WTI Lenders.

The WTI Warrants allow the holders to acquire shares of the Company’s Common Stock or any future equity securities issued by the Company ("Subsequent Round Stock") for cash, at a purchase price equal to $ 0.01 per share.

The number of shares acquirable is determined by dividing $ 10,000 by the applicable exercise price, which varies depending on the type of stock acquired and certain other conditions.

• If the WTI Lenders choose to exercise the warrants for Common Stock, the exercise price is $ 10.00 per share;

The 2024 WTI Warrants are considered freestanding financial instruments and are recorded at fair value on the consolidated balance sheets as a warrant liability in the amount of $ 13.1 million and $ 17.2 million as of December 31, 2025 and 2024, respectively.

For the years ended December 31, 2025 and for the Successor period October 2, 2024 through December 31, 2024, the Company recognized losses of $ 4.2 million and $ 1.5 million, respectively, in change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss).

The 2024 WTI Warrants expire on March 31, 2035.

Fair Value for details on the valuation.

• If the WTI Lenders choose to exercise the 2024 WTI Warrants for Common Stock, the exercise price is $ 10.00 per share;

however, if the volume-weighted average price (VWAP) of the Company's Common Stock is less than $ 10.00 per share as of the date which is eighteen months after the Company's Common Stock began trading, then the exercise price shall be reduced to such lower VWAP.

• If the WTI Lenders choose to exercise the warrants for Subsequent Round Stock, the exercise price shall be the lowest price per share paid by any person for the Company's equity securities issued in a corresponding subsequent round.

The WTI Warrants are exercisable at the option of the holders until March 31, 2035, and may be exchanged for a cash amount of $ 15,000 (subject to ratable reduction for partial exercises) upon the occurrence of certain liquidity events or at any time from and after October 22, 2028.

The holders also have the right to participate in future equity or convertible debt offerings up to an aggregate amount of $ 5,000 or to maintain their pro rata ownership, subject to customary exclusions.

• If the WTI Lenders choose to exercise the 2024 WTI Warrants for Subsequent Round Stock, the exercise price shall be the lowest price per share paid by any person for the Company's equity securities issued in a corresponding subsequent round.

The 2024 WTI Warrants are exercisable at the option of the holders until March 31, 2035, and may be exchanged for a cash amount of $ 15.0 million (subject to ratable reduction for partial exercises) upon the occurrence of certain liquidity events or at any time from and after October 22, 2028.

The holders also have the right to participate in future equity or convertible debt offerings up to an aggregate amount of $ 5.0 million or to maintain their pro rata ownership, subject to customary exclusions.

The 2024 WTI Warrants are considered freestanding financial instruments and are recorded at fair value on the consolidated balance sheets as a warrant liability.

The fair value of the WTI Warrants upon issuance was $ 15,690 .

For the period from issuance to December 31, 2024, the Company recognized a loss of $ 1,540 in Change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss).

The fair value of the 2024 WTI Warrants upon issuance was $ 15.7 million.

On April 14, 2025, the Company issued the 2025 WTI Warrants to purchase, at a price of $ 0.01 per share (subject to certain limitations and adjustment), up to an aggregate total of 495,074 shares of Common Stock, as of the date of issuance and June 30, 2025 (subject to future adjustments to the number and type of shares pursuant to the 2025 WTI Warrants), to the WTI Holders.

Each of the 2025 WTI Warrants is exercisable through March 31, 2035, with additional customary rights and protections.

The 2025 WTI Warrants were issued to the WTI Holders in conjunction with the first issuance of the Convertible Debentures.

The 2025 WTI Warrants serve as consideration for certain provisions under the Consent.

The Company recognized the related warrant liability at fair value at an amount of $ 3.1 million at the time of issuance.

The 2025 WTI Warrants are recorded at fair value on the consolidated balance sheets in the amount of $ 3.2 million as of December 31, 2025.

For the year ended December 31, 2025, the Company recognized a loss of $ 0.1 million, in the change in fair value of financial liabilities on the consolidated statements of operations and comprehensive income (loss).

The 2025 WTI Warrants expire on March 31, 2035.

Fair Value for details on the valuation.

December 31, 2024

Number of Warrants Exercise Price Expiration Date Balance

WTI Warrants 2 varies 3/31/2025 $ 17,230

Mezzanine Capital

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Mezzanine Capital

Predecessor period

The redemption of Class PCTA Units or Class I Units is not solely in control of the Company and, as such, both classes of units are considered redeemable at the option of the holder.

The Class PCTA Units are probable of becoming redeemable and the Class I Units are currently redeemable.

As such, these units are accreted to redemption value at each reporting date.

Class PCTA Units are valued on a monthly basis to align with the underlying value of the PCT stock.

Changes in the redemption value (e.g., fair value) are recognized immediately as they occur and the carrying value of the instrument is adjusted to equal the redemption value at the end of each reporting period.

Class I Units are valued on a quarterly basis based on the underlying fair value of the ESG Fund.

The Class PCTA Units were probable of becoming redeemable and the Class I Units are currently redeemable.

Class PCTA Units were valued on a monthly basis to align with the underlying value of the PCT stock.

Changes in the redemption value (e.g., fair value) were recognized immediately as they occurred and the carrying value of the instrument was adjusted to equal the redemption value at the end of each reporting period.

Class I Units were valued on a quarterly basis based on the underlying fair value of the ESG Fund.

Class PCTA Units carry the right to hold, vote and dispose of the Company’s investment in the related shares of PCT common stock.

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Distributions to Class PCTA and Class I Unit holders are based on their ownership percentage of the respective class.

The Company will distribute unencumbered shares of PCT common stock, held in connection with the Class PCTA Units back to Innventure1, as the original contributing member, and at the election of Innventure1.

When this occurs, Innventure1 is obligated to either invest the after-tax net proceeds into the Company or contribute the shares of PCT common stock (an in-kind capital contribution) back to the Company in exchange for Class B-1 Preferred Units.

With respect to up to 1,000,000 Class PCTA Units, Innventure1 is obligated to acquire Class B-1 Preferred Units after the achievement of certain operational milestones at PCT.

The in-kind capital contributions will correspond to the release of the Company’s obligations under a contractual lock-up agreement related to PCT's common stock and will be equal to the product of the weighted average per share closing price for one share of PCT common stock for each full trading day during the 30 -day period ending on the date of such transfer and multiplied by 0.8 .

There is no maximum amount the Company could be required to pay if the instrument is redeemed.

The Company will distribute the Class I investments held by Innventus ESG Fund I, L.P., to the investor in-kind at the election of WE-INN LLC.

There is no maximum amount that the Company could be required to pay if the instrument is redeemed.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Stockholders' Equity

3 unchanged sentences

Series B Preferred Stock

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The Company is authorized to issue 25,000,000 shares of preferred stock with a par value of $ 0.0001 per share.

Of which, 3,000,000 of the shares of preferred stock are designated as Series B Preferred Stock.

Immediately following the Business Combination, Innventure issued 1,102,000 of Series B Preferred Stock at a purchase price of $ 10.00 per share (the “Original Issue Price”) for a total amount of $ 11,020 .

Series B Preferred Stock are subject to:

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The preferred dividends that became due on December 31, 2024, were recorded within Obligation to issue equity on the consolidated balance sheets.

As of December 31, 2024, the cumulative dividends on Series B Preferred Stock were $ 217 .

The Company is authorized to issue 250,000,000 shares of Common Stock with a par value of $ 0.0001 per share.

Holders of the Company’s common stock are entitled to one vote for each share.

Immediately following the Business Combination, there were 43,589,850 shares of Common Stock issued and outstanding as further discussed in Note 8.

Business Combinations.

As of December 31, 2024 there were 44,597,154 shares of Common Stock issued and outstanding due to the issuance of Common Stock, exercise of Public Warrants, the issuance of Common Stock in relation to the Standby Equity Purchase Agreement, and the vesting of Earnout Shares that occurred prior to year end.

Standby Equity Purchase Agreement

In October 2023, we entered into the SEPA with YA II PN, LTD., an exempt limited partnership from the Cayman Islands (“Yorkville”).

Concurrently with the Business Combination, this agreement became effective.

Pursuant to the SEPA, the Company shall have the right, but not the obligation, to sell to Yorkville up to $ 75,000 of Common Stock, par value $ 0.0001 per share, at the Company’s request any time during the commitment period commencing on the Closing and continuing for a term of 3 years (“Purchased Put Option”).

As consideration, Innventure agreed and paid, to YA Global II SPV, LLC, a subsidiary of Yorkville, (i) a structuring fee in the amount

As of December 31, 2024, the cumulative dividends on Series B Preferred Stock were $ 0.2 million.

On March 19, 2025, the Company distributed 21,808 shares of Series B Preferred Stock to represent $ 0.2 million in cumulative dividends for Series B Preferred Stock, covering the period from the initial issue date, as defined in the certificate of designation of Series B Preferred Stock, to December 31, 2024, as a payment in kind at the specified rate.

During the year ended December 31, 2025, certain holders of Series B Preferred Stock exercised their conversion right and converted 1,085,664 shares of Series B Preferred Stock for 2,164,673 shares of Common Stock.

Upon conversion, all the converted Series B Preferred Stock shares were canceled and retired.

As a result, the Company had a total of 33,144 shares of Series B Preferred Stock issued and outstanding as of December 31, 2025.

As of December 31, 2025, the Company accrued an immaterial amount for the 8 % dividend in the Obligation to issue equity on the consolidated balance sheets.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

of $ 25 and (ii) a commitment fee of $ 375 .

The commitment fee was expensed in full immediately following the consummation of the Business Combination, according to ASC 815, and recorded within the General and administrative expense line item in the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2024.

Series C Preferred Stock

As of December 31, 2025, 5,000,000 shares of the authorized preferred stock are designated as Series C Preferred Stock, $ 0.0001 par value per share (the “Series C Preferred Stock”).

On March 24, 2025, Innventure issued 2,885,848 shares of Series C Preferred Stock at the original issue price for a total amount of $ 28.8 million.

The consideration received by the Company was in the form of cash, services rendered and the cancellation of related party debt.

During the year ended December 31, 2025, certain holders of Series C Preferred Stock exercised their conversion right and converted 2,735,848 shares of Series C Preferred Stock for 5,471,696 shares of Common Stock.

Upon conversion, all the converted Series C Preferred Stock shares were canceled and retired.

The Series C Preferred Stock is subject to similar terms and conditions as the Series B Preferred Stock.

The Company had a total of 150,000 shares of Series C Preferred Stock issued and outstanding as of December 31, 2025.

As of December 31, 2025, the Company accrued $ 0.1 million for the 8 % dividend in the Obligation to issue equity on the consolidated balance sheets.

Standby Equity Purchase Agreement

In October 2023, we entered into the SEPA with YA II PN, LTD., an exempt limited partnership from the Cayman Islands (“Yorkville”).

Concurrently with the Business Combination, this agreement became effective.

Pursuant to the SEPA, the Company shall have the right, but not the obligation, to sell to Yorkville up to $ 75.0 million of Common Stock, par value $ 0.0001 per share, at the Company’s request any time during the commitment period commencing on the Closing and continuing for a term of 3 years (“Purchased Put Option”).

As consideration, Innventure agreed and paid, to YA Global II SPV, LLC, a subsidiary of Yorkville, (i) a structuring fee and (ii) a commitment fee both totaling $ 0.4 million.

Each advance that Innventure issues in writing to Yorkville under the SEPA (each, an “Advance,” and notice of such request, and “Advance Notice”) may be in an amount of Common Stock up to the greater of:

(i) $ 10,000 or (ii) the aggregate daily trading volume of Common Stock for the five trading days prior to Innventure requesting an Advance.

(i) $ 10.0 million or (ii) the aggregate daily trading volume of Common Stock for the five trading days prior to Innventure requesting an Advance.

The purchase price for the shares of Common Stock set forth in the Advance is determined by multiplying the market price of Common Stock by either (a) 95 % of the daily volume weighted average price (“VWAP”) during the applicable one-day pricing period or (b) 97 % of the lowest daily VWAP during the applicable three consecutive trading day pricing period.

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Once the Company draws on the SEPA, the related number of shares issuable constitutes a forward contract to issue common stock (“Forward Contract”).

The SEPA will automatically terminate on the earlier to occur of (i) November 01, 2027 and (ii) the date on which Yorkville shall have made payment of advances pursuant to the SEPA for Common Stock equal to the commitment amount of $ 75,000 .

On December 24, 2024, the Company issued and sold 60,000 shares of Common Stock in amount of $ 770 , based on the settlement date closing stock price.

Additionally, on December 30, 2024, the Company issued and sold 75,000 shares of Common Stock in an amount of $ 965 .

For the year ended December 31, 2024, the Company sold 135,000 shares of Common Stock under the SEPA, raising $ 1,735 which is classified within Issuance of common shares, net of issuance costs in the consolidated statements of changes in stockholders' equity (deficit).

For the year ended December 31, 2025 and the successor period October 2, 2024 through December 31, 2024, the Company sold 1,071,566 and 135,000 shares of Common Stock under the SEPA, raising $ 6.1 million and $ 1.7 million, respectively, which is classified within Issuance of common shares, net of issuance costs in the consolidated statements of changes in stockholders' equity (deficit).

At Risk Sponsor Shares

3 unchanged sentences

The Sponsor Earnout Shares are issued until they are deemed forfeited due to non-achievement of the associated Milestones.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Earnout Shares for more discussion on the Sponsor Earnout Shares.

6 unchanged sentences

Service Provider Shares

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

In December 2023, the Company entered into an agreement to receive financial advisory services in exchange for equity.

Upon Closing of the Business Combination, the Company became liable for $ 441 of Common Stock divided by the conversion price of $ 10.87 , resulting in 40,552 shares.

Upon Closing of the Business Combination, the Company became liable for $ 0.4 million of Common Stock divided by the conversion price of $ 10.87 , resulting in 40,552 shares.

In connection with the closing of the WTI Facility mentioned in Note 5.

Borrowings, the Company became liable for $ 500 worth of Common Stock calculated as the volume-weighted average price of the Common Stock over the five consecutive trading days ending on the trading day immediately preceding November 15, 2024, $ 11.13 , for a total of 44,919 shares.

The resulting liabilities for these unissued securities are included within Liability for future equity issuance on the consolidated balance sheets.

Borrowings, the Company became liable for $ 0.5 million worth of Common Stock calculated as the volume-weighted average price of the Common Stock over the five consecutive trading days ending on the trading day immediately preceding November 15, 2024, $ 11.13 , for a total of 44,919 shares.

On February 3, 2025, the Company has issued the aggregate 85,471 shares of Common Stock for services rendered.

In October 2023, the Company entered into an agreement to receive financial advisory services in exchange for equity.

Upon Closing of the Business Combination, the Company is obligated to pay a success fee in cash in an amount of $ 600 and equity success fee in $ 3,000 of Series C Preferred Stock, par value $ 0.0001 per share, of the Company (the “Series C Preferred Stock”) at $ 10.00 per share.

As of December 31, 2024, the Company has no Series C Preferred Stock outstanding and, therefore, has not yet issued this 300,000 Series C Preferred Stock.

The resulting liabilities for these unissued securities are included within Obligation to issue equity on the consolidated balance sheets.

Upon Closing of the Business Combination, the Company is obligated to pay a success fee in cash in an amount of $ 0.6 million and equity success fee in $ 3.0 million of Series C Preferred Stock, par value $ 0.0001 per share, of the Company (the “Series C Preferred Stock”) at $ 10.00 per share.

On March 24, 2025, the Company issued the 300,000 shares of Series C Preferred Stock for services rendered.

Series B Units

On October 2, 2025, Accelsius issued and sold 685,163 Accelsius Series B-1 Units (the “Series B-1 Units”) to Johnson Controls, Inc.

(“JCI”) for approximately $ 25.0 million, before deducting financial advisor fees and other estimated offering expenses.

JCI is entitled to appoint and remove a director to the board of directors of Accelsius if JCI and its affiliates maintain a significant ownership percentage.

As a result of the sale of Series B-1 Units to JCI, the August 2025 Notes converted into 251,452 Series B-2 units and 125,725 B-2 Warrants were issued.

On December 29, 2025, Accelsius issued and sold 822,195 Series B-1 Units to Legrand DPC, LLC, (“ Legrand ”), for approximately $ 30.0 million, before deducting financial advisor fees and other estimated offering expenses.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Additionally, Accelsius issued and sold to JCI an additional 274,065 units of the Series B-1 Units for gross proceeds of approximately $ 10 million.

The Series B-1 Units are convertible at any time and from time to time into Accelsius’ Class A Common Units by dividing the Series B-1 Unit’s Issue Price (as defined below) by the Conversion Price (as defined below) in effect at the time of conversion.

The Issue Price means $ 36.49 per unit, subject to appropriate adjustment in the event of any unit dividend, unit split, combination or other similar recapitalization with respect to the applicable Series B-1 Units.

The “ Conversion Price ” shall initially equal $ 36.49 and will be subject to certain adjustments.

Private Placement Issuances

On October 3, 2025, the Company raised approximately $ 9.8 million through a private placement, issuing 1,625,235 shares of Common Stock at $ 6.00 per share and Series A warrants to purchase 1,625,235 shares of Common Stock (the “Series A Warrants”).

The Series A Warrants, exercisable from April 6, 2026 at $ 8.00 per share, are redeemable under certain conditions until October 3, 2030.

On January 12, 2026, the Company entered into securities purchase agreements with four institutional investors for the purchase and sale of 11,428,572 shares of common stock for gross proceeds of approximately $ 40.0 million, before deducting placement agent fees and offering expenses.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Stock-based Compensation

4 unchanged sentences

The Company recognized compensation costs related to the Capital Incentive Plan as follows:

Successor Predecessor

Period from October 2, 2024 through December 31, 2024 Period from January 1 2024 through October 1, 2024 Year ended

December 31, 2023

Successor Successor Predecessor

Year Ended December 31, 2025 Period from October 2, 2024 through December 31, 2024 Period from January 1 2024 through October 1, 2024

Compensation expense

2 unchanged sentences

On October 2, 2024, the Company entered into the 2024 Equity and Incentive Compensation Plan (the “Plan”), wherein the Company is permitted to grant awards to employees, directors, consultants, and former service providers of the Company.

The Plan provides for the granting of awards including, restricted stock units (“RSUs”), stock options, and stock appreciation rights (“SARs”).

The Plan provides for the granting of awards (“Awards”) including, restricted stock units (“RSUs”), stock options, and stock appreciation rights (“SARs”).

The number of shares of Common Stock available under the Plan is initially limited to 11,022,894 .

The share limit will automatically increase by 3 % on the first day of each fiscal year, beginning in 2025, unless a smaller number of shares is determined by the Board of Directors.

On December 9, 2024, the Company granted 975,409 stock options and 2,036,476 restricted stock units (together the “Awards”) to certain directors, employees and consultants.

The Awards vest over the service periods defined in each individual grant agreement, which is generally accelerated upon a change in control.

All RSUs will be vested by

The Awards vest over the service periods defined in each individual grant agreement.

All RSUs will vest at various dates through August 2028.

The fair value of the Awards issued to employees is recognized as compensation expense on a straight-line basis over the requisite service period.

As of December 31, 2025, 4,629,340 shares remain available under the Plan.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

May 1, 2027 and all stock options will be vested by April 30, 2027.

The fair value of the Awards issued to employees is recognized as compensation expense on a straight-line basis over the requisite service period.

Restricted Stock Units

2 unchanged sentences

If a cash dividend is declared on the Company’s Common Stock before the RSUs have vested, holders of RSUs are entitled to received dividends in the form of a cash credit, and shall be paid in cash at the same time as the RSUs are settled.

The summary of RSU activity for the Successor period from October 2, 2024 through December 31, 2024 is as follows:

The summary of RSU activity is as follows:

Number of Shares Weighted Average Grant Date Fair Value (per share)

Granted on December 9, 2024 2,036,476 $ 12.20

Unvested at January 1, 2025 1,905,008 $ 12.20

Granted 653,118 4.60

Vested ( 1,382,725 ) 11.61

Forfeited ( 123,562 ) 9.36

Non-vested at December 31, 2024 1,905,008 $ 12.20

During the Successor period from October 2, 2024 through December 31, 2024, the Company recognized compensation costs related to the RSUs of $ 1,604 within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2024, the Company had $ 23,241 in stock-based compensation expense remaining to be recognized over approximately 1.65 years.

Unvested at December 31, 2025 1,051,839 $ 8.68

During the year ended December 31, 2025 and the Successor period from October 2, 2024 through December 31, 2024, the Company recognized compensation costs related to the RSUs of $ 16.1 million and $ 1.6 million, respectively, within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2025, the Company had $ 8.9 million in stock-based compensation expense remaining to be recognized over approximately 1.58 years.

Stock Options

The stock options were granted with an exercise price of $ 12.20 , which aligns with the Company’s closing share price on December 9, 2024.

Using the Black-Scholes option pricing model, the estimated grant date fair value of stock options was $ 6,468 based on an expected volatility of 56 %, an expected option term of approximately 5.28 - 5.62 years, and risk-free rate of return of 4.0 - 4.1 %.

On February 26, 2025, the Company issued 140,000 stock options to two independent contractors.

The stock options were granted with an exercise price of $ 8.84 .

Using the Black-Scholes option pricing model, the estimated grant date fair value of stock options was $ 3.20 per option based on an expected volatility of 56 %, an expected option term of approximately 5.9 years, and risk-free rate of return of 4.06 %.

The stock options have a maximum contractual life of 10 years from the grant date.

On December 9, 2024, stock options were granted with an exercise price of $ 12.20 , which aligns with the Company’s closing share price on December 9, 2024.

Using the Black-Scholes option pricing model, the weighted average estimated grant date fair value of stock options was $ 6.63 per unit based on an expected volatility of 56 %, an expected option term of approximately 5.28 - 5.62 years, and risk-free rate of return of 4.0 - 4.1 %.

The stock options have a maximum contractual life, and a weighted average remaining contractual term, of 10 years from the grant date.

2 unchanged sentences

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Stock options activity for the Successor period from October 2, 2024 through December 31, 2024 is as follows:

Stock options activity for the year ended December 31, 2025 is as follows:

Number of Shares Weighted Average Exercise Price Weighted Average Grant Date Fair Value (per share)

Granted on December 9, 2024 975,409 $ 12.20 $ 6.63

Outstanding on December 31, 2024

913,849 $ 12.20 $ 6.63

Granted 152,295 8.84 4.97

Vested ( 640,799 ) 11.75 6.57

Exercised — — —

Forfeited ( 85,755 ) 12.20 6.69

Outstanding at December 31, 2025

339,590 $ 11.44 $ 6.31

Exercisable at December 31, 2025

During the Successor period from October 2, 2024 through December 31, 2024, the Company recognized compensation costs related to the stock options of $ 405 within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2024, the Company had $ 6,063 in compensation expense remaining to be recognized over approximately 1.68 years.

702,359 12.20 6.63

During the year ended December 31, 2025 and for the Successor period from October 2, 2024 through December 31, 2024, the Company recognized compensation costs related to the stock options of $ 4.1 million and $ 0.4 million, respectively, within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2025, the Company had $ 2.1 million in compensation expense remaining to be recognized over approximately 1.45 years.

Stock Appreciation Rights

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Both the cash-settled SARs and stock-settled SARs will be automatically exercised upon the two-year anniversary of the date of grant.

The weighted average contractual term is 2 years.

The estimated grant date fair value of the cash-settled SARs and the stock-settled SARs was $ 1,160 and $ 12,371 , respectively.

The SARs were valued using the Black-Scholes option-pricing model based on an expected volatility of 70 %, an expected term of approximately 2 years, and risk-free rate of return of 4 %.

The remaining weighted average contractual term is 1 year as of December 31, 2025.

The estimated grant date fair value of the cash-settled SARs and the stock-settled SARs was $ 1.1 million and $ 12.4 million, respectively.

The SARs were valued using the Black-Scholes option-pricing model based on an expected volatility of 70 %, an expected term of approximately two years , and risk-free rate of return of 4 %.

The SARs are considered fully vested at the date of grant and compensation cost for both SARs was recognized immediately at the date of grant.

During the Successor period from October 2, 2024 through December 31, 2024, the Company recorded $ 13,531 in compensation expense related to the SARs within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

The summary of SARs activity for the Successor period from October 2, 2024 through December 31, 2024 is as follows:

During the Successor period from October 2, 2024 through December 31, 2024, the Company recorded $ 13.5 million in compensation expense related to the SARs within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

These cash-settled SARs are liability classified and are revalued at each reporting period.

The SARs were valued as of December 31, 2025 using the Black-Scholes option-pricing model based on an expected volatility of 70 %, an expected term of approximately 1.0 year, and risk-free rate of return of 3 %.

The Company recognized a decrease in compensation expense in the amount of $ 0.9 million in relation to the change in fair value of the cash-settled SARs for the year ended December 31, 2025.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Cash-settled SARs Stock-settled SARs

Number of Shares Weighted Average Exercise Price Weighted Average Grant Date Fair Value (per share) Number of Shares Weighted Average Exercise Price Weighted Average Grant Date Fair Value (per share)

Granted on December 9, 2024 30,000 $ 12.18 $ 38.66 320,000 $ 12.18 $ 38.66

Vested — — — — — —

Exercised — — — — — —

Forfeited — — — — — —

Outstanding at December 31, 2024 30,000 $ 12.18 $ 38.66 320,000 $ 12.18 $ 38.66

Exercisable at December 31, 2024 — — — — — —

On June 25, 2025, the SARs agreements were amended.

Under these amendments, any payments by the Company to the participants shall be made in the form of shares of Common Stock and the maximum number of shares of Common Stock that may be issued pursuant to the SAR Agreements shall be 4,000,000 .

There were no new or forfeited grants as of December 31, 2025.

Subsidiary Equity Plans

3 unchanged sentences

The awards vest over the period defined in each individual grant agreement which is generally accelerated upon a change of control event.

Accelsius has the option to repurchase all vested units upon an employee’s termination of employment or service.

Accelsius typically has the option to repurchase all vested units upon an employee’s termination of employment or service.

The summary of Accelsius Subsidiary Equity Plan activity is as follows:

Successor Period Predecessor Period

Year Ended December 31, 2025 Period from

October 2, 2024 through December 31, 2024 Period from

January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Compensation expense

January 1, 2024 through October 1, 2024

Compensation expense (in thousands)

$ 7,411 $ 1,341 $ 918

1 unchanged sentence

Weighted average grant date fair value per share $ 20.37 $ 46.38 $ 4.41

The grant date fair value per share for the year ended December 31, 2023 is an average amount.

The Company recognizes compensation costs within General and administrative, Sales and marketing and Research and development expense in the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2024, the Company had $ 8,103 in unit-based compensation expense remaining to be recognized over approximately 2.42 years.

As of December 31, 2025, the Company had $ 20.4 million in unit-based compensation expense remaining to be recognized over approximately 1.92 years.

The grant date fair value was estimated using an Option Pricing Model to allocate the total equity value of Accelsius to the Class C Units.

2 unchanged sentences

Series A Issuance

On October, 18 2024, Accelsius issued 16,427 equity classified Series A Preferred Units to an employee of the Company which was determined to be stock based payment.

The grant date fair value of $ 0.6 million was recognized as compensation cost during the Successor period from October 2, 2024 through December 31, 2024,(within General and administrative expense in the consolidated statements of operations and comprehensive income (loss)), immediately at the date of grant as there is no requisite service period or vesting period.

The fair value of the awards was estimated using a Black-Scholes model with a discount for lack of marketability of 20 % applied.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

On October, 18 2024, Accelsius issued 16,427 equity classified Series A Preferred Units to an employee of the Company which was determined to be stock based payment.

The grant date fair value of $ 616 was recognized as compensation cost (within General and administrative expense in the consolidated statements of operations and comprehensive income (loss)), immediately at the date of grant as there is no requisite service period or vesting period.

The fair value of the awards was estimated using a Black-Scholes model with a discount for lack of marketability of 20 % applied.

In 2024, the Company began selling products and services in its technology segment.

The Company provides investment management services to the ESG Fund, a related party, through which it earns revenue from management fees.

Management fee revenue is affected by economic factors related to the asset class composition of the holdings and the contractual terms such as the basis for calculating the management fees and investors’ ability to redeem.

The Company did not recognize any carried interest allocation during the Successor period from October 2, 2024 through December 31, 2024, the Predecessor period from January 1, 2024 through October 1, 2024 and the Predecessor year ended December 31, 2023, as the amounts were probable of significant reversal given the consideration is highly susceptible to factors outside the Company's influence.

Cumulative carried interest allocation amounts that are subject to restraint and as such are not yet recognized were $ 11,282 and $ 5,880 as of December 31, 2024 and 2023, respectively.

The Company did not recognize any carried interest allocation during the year ended December 31, 2025, the Successor period from October 2, 2024 through December 31, 2024, and the Predecessor period from January 1, 2024 through October 1, 2024, as the amounts were probable of significant reversal given the consideration is highly susceptible to factors outside the Company's influence.

Cumulative carried interest allocation amounts that are subject to restraint and as such are not yet recognized were $ 9.6 million and $ 11.3 million as of December 31, 2025 and 2024, respectively.

The Company also provides management services to AeroFlexx, which do not have a carried interest feature.

The following table represents the breakout of revenue by source:

The following table represents the breakout of revenue by source (in thousands):

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Product revenue $ 1,557 $ 233 $ 95

Management fees - related party 499 223 669

Consulting revenue — — 225

Total revenue $ 2,056 $ 456 $ 764

1 unchanged sentence

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Customer A - Related Party 19.0 % 43.0 % 77.0 %

3 unchanged sentences

Customer E 3.0 % 48.9 % — %

Customer F 20.1 % — % — %

Total Revenue Concentration of Major Customers

3 unchanged sentences

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The Company is subject to federal and state income taxes with respect to any income or loss generated as well as the allocable share of any taxable income or loss of Innventure LLC and other partnership subsidiaries.

4 unchanged sentences

Where required or allowed, the corporation subsidiaries file and pay tax in a standalone basis for federal and state income tax purposes.

The Company anticipates this structure to remain in existence for the foreseeable future.

The provision for income taxes was as follows:

The Company anticipates the US structure to remain in existence for the foreseeable future.

In addition, Accelsius Ltd, a UK corporation, began operations in 2025 resulting in income tax return filing requirement for the Company in the UK.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into U.S.

OBBBA includes a broad range of tax reform provisions, such as the permanent extension of certain expiring provisions of the 2017 Tax Cuts and Jobs Act and modifications to the international tax framework.

The enactment of OBBBA did not have a material impact on the Company’s results of operations, financial position, or cash flows for the year.

The provision for income before taxes was as follows (in thousands):

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

United States $ ( 488,148 ) $ ( 73,375 ) $ ( 27,766 )

Total $ ( 488,833 ) $ ( 73,375 ) ( 27,766 )

1 The Company adopted ASU 2023-09 on a prospective basis, and as a result for the year ended December 31, 2025, foreign income is presented on the country of domicile which results in Innventure, Inc’s income before taxes included.

For the periods ended December 31, 2024 and October 1,2024, Innventure, Inc’s income was included in the United States based on the country of tax jurisdiction.

The provision for income taxes was as follows:

Successor Successor Predecessor

Year Ended December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Current Expense:

Federal — — —

Foreign — — —

State 23 18 —

Total Current Expense 23 18 —

1 unchanged sentence

Federal ( 13,648 ) ( 3,300 ) 432

Foreign — — —

State 142 — —

Total Deferred Expense ( 13,506 ) ( 3,300 ) 432

( 3,301 ) 432 —

Total Expense:

$ ( 13,483 ) $ ( 3,282 ) $ 432

A reconciliation of the expected statutory federal tax and the total income tax expense (benefit) was as follows:

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Beginning with the year ended December 31, 2025, the Company has adopted ASU 2023-09 and, as a result, the reconciliation of income tax expense has been updated on a prospective basis.

The Company did not pay income taxes net of refunds during the year ended December 31, 2025.

As no income taxes were paid, disaggregation by federal, state, or foreign jurisdiction was not applicable for the period presented.

The income tax benefit reflected in the Consolidated Statements of Operations differs from the tax computed by applying the statutory U.S.

federal rate of 21% to "Income tax expense (Benefit)" was as follows:

December 31, 2025

In thousands (except percentages)

Income taxes at federal statutory rate ( 102,655 ) 21.0 %

State taxes, net of federal benefit 2

Warrant liability ( 1,379 ) 0.3 %

Non-deductible expenses 34 — %

Change in earnout fair value ( 2,098 ) 0.4 %

Other permanent differences 7,224 ( 1.5 ) %

Change in valuation allowance 11,618 ( 2.4 ) %

Goodwill impairment 72,777 ( 14.9 ) %

Officer’s compensation 1,141 ( 0.2 ) %

Total provision (benefit) for income taxes

$ ( 13,483 ) 2.7 %

2 Arizona, Florida, New York, Oklahoma, and Virginia represent majority of the tax effect in this category.

For the successor period October 2, 2024 through December 31, 2024 and the predecessor period January 1, 2024 through October 1, 2024, income tax expense reflected in the Consolidated Statements of Operations differs from the tax computed by applying the statutory U.S.

federal rate of 21% to "Income tax expense (benefit)" was as follows:

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

Pre-tax book loss $ ( 73,375 ) $ ( 27,766 ) $ ( 30,984 )

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Income taxes at federal statutory rate ( 15,405 ) 21.0 % — — %

9 unchanged sentences

$ ( 3,282 ) 4.6 % $ 432 ( 1.5 ) %

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Entities within the consolidated group that are considered a corporation for federal income tax purposes, recognize deferred income tax assets and liabilities for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases using currently enacted tax rates in effect for the year in which the differences are expected to reverse.

3 unchanged sentences

Deferred lease liabilities $ 262 $ 138

Reserves and other accruals 8,991 4,873

Capitalized R&D expense 3,740 2,562

Fixed assets and intangibles 2,830 3,113

Reserves and other accruals 4,873 178

Unrealized Gain/Loss 1,945 —

Loss carry-forwards and other tax attributes 29,753 15,682

Total Deferred Tax Assets

47,521 26,368

Valuation allowance ( 23,130 ) ( 11,664 )

11 unchanged sentences

The ultimate realization of deferred tax assets is dependent upon future taxable income during the periods in which those temporary differences become deductible.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

utilization of net operating loss carryforwards, the reversal of deferred tax liabilities, projected taxable income, and tax-planning strategies.

In assessing the need for a valuation allowance, management considers all available positive and negative evidence, including the ability to carryback operating losses to prior periods and the expected future utilization of net operating loss carryforwards, the reversal of deferred tax liabilities, projected taxable income, and tax-planning strategies.

Valuation allowances are established when it is more likely than not that all or a portion of a deferred tax asset will not be realized.

The valuation allowance on deferred tax assets was $ 11,664 as of December 31, 2024 and $ 5,910 as of December 31, 2023, resulting in a net change of $ 5,754 .

The increase in valuation allowance of $ 15,115 during the period mainly relates to U.S.

The valuation allowance on deferred tax assets was $ 23.1 million as of December 31, 2025 and $ 11.7 million as of December 31, 2024, resulting in a net change of $ 11.5 million.

The increase in valuation allowance of $ 11.5 million during the period mainly relates to U.S.

federal and state operating loss carryforwards and equity based compensation deferred tax assets that were deemed unrealizable.

During this period, Accelsius recognized significant deferred tax liabilities from acquired intangible assets as part of the Business Combination.

The deferred tax liability provided a new source of income to realize the existing deferred tax assets, which provided enough positive evidence to release the valuation allowance of $ 9,361 .

During this period, Accelsius LLC has recognized $ 39.6 million deferred tax liability balance in acquired intangible assets during 2024 as a result of the Business Combination transaction that is nontaxable in nature.

These deferred tax liabilities are expected to reverse over time, typically as the intangible assets are amortized for financial reporting purposes.

The Company and the remaining corporate subsidiaries maintained the valuation allowance as the entities have been in a pre-tax loss position, with insufficient projected taxable income (exclusive of reversing taxable temporary differences) to recognize the benefit of net deferred tax assets as of the end of the year.

As of December 31, 2024, the taxable entity had net operating loss carryforwards for income tax purposes of approximately $ 62,653 related to federal taxes, all of which may be carried forward indefinitely.

The Company and certain subsidiaries also have state net operating loss (“NOL”) carryforwards in the amount of $ 39,262 .

As of December 31, 2025, the taxable entity had net operating loss carryforwards for income tax purposes of approximately $ 127.0 million related to US federal taxes and $ 0.7 million related to the UK, all of which may be carried forward indefinitely.

The Company and certain subsidiaries also have state net operating loss (“NOL”) carryforwards in the amount of $ 40.6 million.

The state NOL carryforwards begin to expire in 2039, however, some state NOL’s are able to be carried forward indefinitely.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

As of December 31, 2025 and 2024, the Company had no material unrecognized income tax benefits or uncertain tax positions.

1 unchanged sentence

As of December 31, 2025, tax years 2023 through 2025 remain open and subject to examination by the Internal Revenue Service and the states where the Company has nexus.

The company is also subject to examination for the tax year 2025 in the UK due to Accelsius LTD.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Net Loss Per Share

2 unchanged sentences

The two-class method also requires losses for the period to be allocated between common shares and participating securities based on their respective rights if the participating security contractually participates in losses.

As holders of Series B preferred shares and WTI warrants, which are determined to be participating securities, do not have a contractual obligation to fund losses, undistributed net losses are not allocated to them for purposes of the loss per share calculation.

As holders of Series B preferred shares, Series C preferred shares and WTI warrants, which are determined to be participating securities, do not have a contractual obligation to fund losses, undistributed net losses are not allocated to them for purposes of the loss per share calculation.

Given the historical structure of the Predecessor, the Company determined that the calculation of earnings per membership unit results in values that are not a valuable metric to users of these consolidated financial statements.

Therefore, earnings per share (“EPS”) information is omitted for the Predecessor periods.

Presented in the table below is a reconciliation of the numerator and denominator for the EPS calculations for the Successor period from October 2, 2024 through December 31, 2024:

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

October 2, 2024 through December 31, 2024

Presented in the table below is a reconciliation of the numerator and denominator for the EPS calculations( in thousands except per share amounts ):

December 31, 2025 October 2, 2024 through December 31, 2024

Net loss attributable to Innventure, Inc.

2 unchanged sentences

Undistributed loss for participating securities

( 293,437 ) ( 61,971 )

Undistributed loss attributable to participating securities

1 unchanged sentence

Weighted average number of units outstanding, basic and diluted

54,421 43,951

Net loss per share attributable to common shareholders, basic and diluted

$ ( 5.39 ) $ ( 1.41 )

Basic and diluted net loss per share was the same for each period presented as the inclusion of all potential common stock outstanding would have been anti-dilutive.

The following table presents the potential common stock outstanding that was excluded from the computation of diluted net loss per share of common stock for the periods presented because including them would have been antidilutive:

December 31, 2024

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2025 December 31, 2024

Public warrants 11,246,000 11,500,000

1 unchanged sentence

2024 WTI Warrants 1,000,000 1,000,000

Series B preferred shares 1,011,869

Convertible Debentures 1,750,726 —

2025 WTI Warrants 495,074 —

Series B Preferred Stock 55,067 1,011,869

Series C Preferred Stock 249,214 —

Share options 1,026,404 975,409

RSUs 1,029,435 2,036,476

SARs 4,000,000 320,000

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Related Party Transactions

As more fully described in Note 5.

Borrowings, the Company has various notes with affiliates, including short-term notes with three separate related parties.

In addition, the Company had a convertible note to the ESG Fund as part of the 2025 Notes which was converted during the Predecessor period from January 1, 2024 through October 1, 2024.

Borrowings, the Company has various notes with affiliates, including short-term notes with three separate related parties which were settled on March 20, 2025.

In addition, the Company issued a convertible note to the ESG Fund pursuant to the Amended and Restated Series I Convertible Note Purchase Agreement, dated as of June 2, 2023, by and among Accelsius, ESG Fund, and the other parties thereto, which were converted during the Predecessor period January 1, 2024 to October 1, 2024.

During the year ended December 31, 2025 (Successor), the Company entered into the Related Party Convertible Notes with various related parties, including other lenders.

Transactions with Directors

1 unchanged sentence

Stock-based Compensation, the Company issued various equity awards to related parties throughout 2024.

On December 9, 2024, the Company issued 1,246,722 RSUs with a grant date fair value of $ 15,210 , and 590,163 stock options with a grant date fair value of $ 3,913 to a cumulative of 8 directors.

On December 31, 2024, the Company issued 200,000 SARs with a grant date fair value of $ 7,820 to 4 directors and former directors.

On March 22, 2024, the Company issued 100,000 Class C Units with a grant date fair value of $ 441 to 1 director under the Accelsius Subsidiary Equity Plan.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Transactions with Innventure1

In 2022, Innventure1 assigned its ownership interest in a portion of the Company’s PCT common stock to investors who are considered related parties of Innventure1 and the Company.

The related party liability established in connection with this assignment was revalued to $ 53 on December 31, 2023.

The change in value was included in Net gain on investments - due to related parties in the consolidated statements of operations and comprehensive income (loss).

On December 9, 2024, the Company issued 1,246,722 RSUs with a grant date fair value of $ 15.2 million and 590,163 stock options with a grant date fair value of $ 3.9 million to a cumulative of eight directors.

On December 31, 2024, the Company issued 200,000 SARs with a grant date fair value of $ 7.8 million to four directors and former directors.

On March 22, 2024, Accelsius issued 100,000 Class C Units with a grant date fair value of $ 0.4 million to one director under the Accelsius Subsidiary Equity Plan.

Additionally, on June 25, 2025, the Company issued 111,525 RSUs with a grant date fair value of $ 0.6 million to five directors pursuant to the Innventure Non-Management Director Compensation Plan.

On August 25, 2025, the Company issued 338,601 RSUs with a grant date fair value of $ 1.5 million to two directors, pursuant to the 2024 Plan.

Transactions with the ESG Fund

1 unchanged sentence

Certain expenses paid by the Company, which meet certain criteria, are reimbursed to the Company by the ESG Fund.

Amounts paid by the Company and reimbursable by the ESG Fund were $ 105 for the Successor period from October 2, 2024 through December 31, 2024, and $ 50 for the Predecessor period from January 1, 2024 through October 1, 2024, and $ 48 for the Predecessor year ended December 31, 2023.

There was a receivable of $ 64 and $ 2 as of December 31, 2024 and 2023, respectively, related to those expenses included in Due from related parties in the consolidated balance sheets.

Amounts paid by the Company and reimbursable by the ESG Fund were $ 0.1 million for the year ended December 31, 2025 (Successor), $ 0.1 million for the Successor period from October 2, 2024 through December 31, 2024, and $ 0.1 million for the Predecessor period from January 1, 2024 through October 1, 2024.

There was an immaterial receivable related to those expenses included in Due from related parties in the consolidated balance sheet as of December 31, 2025 and a $ 0.1 million receivable due from related parties in the consolidated balance sheet as of December 31, 2024.

As more fully described in Note 2.

Accounting Policies, the Company earns a 1 - 2 % management fee for administrative, finance and accounting, and other back-office functions from the ESG Fund.

Management fees earned from the ESG Fund were $ 196 for the Successor period from October 2, 2024 through December 31, 2024, and $ 588 for the Predecessor period from January 1, 2024 through October 1, 2024.

Management fees earned from the ESG Fund totaled $ 789 for the Predecessor year ended December 31, 2023, which is recorded as Revenue in the consolidated statements of operations and comprehensive income (loss).

In March 2021, the Company entered into a purchase option agreement with the ESG Fund to sell 145,161 shares of PCT common stock with an exercise price of $ 1 .

The option period would have expired on July 22, 2024 and the Company measured the derivative liability at fair value, as further described in Note 4.

Management fees earned from the ESG Fund were $ 0.4 million for the year ended December 31, 2025 (Successor), $ 0.2 million for the Successor period from October 2, 2024 through December 31, 2024, and $ 0.6 million for the Predecessor period from January 1, 2024 through October 1, 2024, which is recorded as Revenue in the consolidated statements of operations and comprehensive income (loss).

In March 2021, the Company entered into a purchase option agreement with the ESG Fund to sell 145,161 shares of PureCycle Technologies, Inc.

(“PCT”) common stock with an exercise price of $ 1 .

The option period would have expired on July 22, 2024 and the Company measured the derivative liability at fair value.

The option was exercised in March 2022 and the shares are subject to the lock-up provisions.

The liability due to the ESG Fund as of December 31, 2023 was $ 294 and is included in Related party payables in the consolidated balance sheets.

In 2023, the Company sold 23,712 of Accelsius Class A Series 2 Units to the ESG Fund for aggregate proceeds of approximately $ 104 .

This amount is reflected in Non-controlling interests in the consolidated statements of changes in stockholders' equity (deficit).

The liability due to the ESG Fund was derecognized as a result of the Business Combination.

Transactions with AeroFlexx

The Company’s related party transactions with AeroFlexx are described in Note 3.

Additionally, in the normal course of business, the Company advances certain expenses on behalf of AeroFlexx.

Amounts paid by the Company and reimbursable by AeroFlexx were $ 27 for the Successor period from October 2, 2024 through December 31, 2024, and $ 84 for the Predecessor period from January 1, 2024 through October 1, 2024, and $ 116 for the Predecessor year ended December 31, 2023.

There was a receivable of $ 97 and $ — as of December 31, 2024 and 2023, respectively, related to those expenses included in Due from related parties in the consolidated balance sheets.

Commitments and Contingencies

On April 22, 2020, the Company entered into a guaranty with a counterparty to unconditionally guarantee PCT’s obligation to reimburse a $ 5,000 pre-payment upon PCT’s failure to meet certain performance thresholds.

Performance thresholds include the commission and construction of a plant.

The guaranty has no expiration.

The total amount paid by the Company under the guaranty is $ 0 and total interest paid is $ 0 .

As of December 31, 2024 and 2023, there was no principal outstanding under the guaranty.

As of December 31, 2025 and December 31, 2024, the Company had $ 10.5 million and $ 4.4 million, respectively, of advances to AeroFlexx which is included in Due from related parties in the consolidated balance sheets.

The advances have no stated interest or maturity date but are expected to be repaid within a year.

On March 24, 2025, the Company issued 578,294 shares of Series C Preferred Stock to settle AeroFlexx’s debt with a related party.

The Company considers the stock issuance to be an investment in AeroFlexx of $ 5.8 million which was recorded in Investments on the consolidated balance sheets.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Commitments and Contingencies

On April 22, 2020, the Company entered into a guaranty with a counterparty to unconditionally guarantee PCT’s obligation to reimburse a $ 5.0 million prepayment upon PCT’s failure to meet certain performance thresholds.

Performance thresholds include the commission and construction of a plant.

The guaranty has no expiration.

There was no amounts paid by the Company for both the guaranty or for interest.

As of December 31, 2025 and December 31, 2024, there was no principal outstanding under the guaranty.

Patent Agreement Contingent Fees

In 2022, the Company entered into two agreements with an MNC to purchase in-process research and development consisting of patents, technology, and knowledge transfer related to cooling technology for critical electronic equipment in a transaction that was determined to be an asset acquisition.

Under the terms of the agreements, the Company is required to make minimum installment payments, as disclosed below, for each year of the agreement through February 1, 2040.

Each installment payment shall be credited towards and set off against any royalty payments (described below) which may become due.

As such, these installment payments serve as minimum amounts due to the MNC each calendar year.

Minimum royalties included in Patent installment payables on the consolidated balance sheets are due as follows:

Years Ending December 31, Amount

On June 30, 2025, Accelsius entered into an amended and restated agreement with the MNC.

The amended agreement modifies several terms and notably (a) eliminates revenue-based royalty payments, (b) extends the due dates for fixed installment payments, (c) modifies and reduces the buy-out fee payable to the MNC in lieu of future installment payments upon certain events such as an assignment of the agreement or a capital event (including a change of control or initial public offering), at the option of either the MNC or Accelsius, and (d) eliminates Accelsius’s ability to unilaterally terminate the agreement upon the occurrence of certain events (other than a material breach) and provides the MNC with certain limited information rights related to the equity ownership of Accelsius.

Under the terms of the agreements, the Company is required to make fixed installment payments, as disclosed below, for each year of the agreement through December 31, 2040 (in thousands):

Thereafter 9,075

Total $ 13,075

The Company is committed to make royalty payments on direct revenue generated from the subject technology and indirect revenue generated including additional incentives based on the volume of units sold at percentage rates in the single digits to mid-teens as defined within the respective agreement.

Each year the Company will pay such royalties at the higher of:

(i) the minimum amount due (noted in the table above) and (ii) the royalty calculated amount based on revenue and units sold.

License and Royalty Commitments

On December 12, 2024, the Company entered into a license agreement (the “Technology License”) with a third party to obtain exclusive rights to use certain know-how, patents, and data relating to processes for the gasification of plastic waste (the “Technology”).

Ownership of the Technology will transfer to the Company for a fee of $ 500 contingent upon achievement of a commercial milestone, which is not yet probable.

The Company incurred a nonrefundable upfront fee of $ 500 under the Technology License, which is immediately expensed as incurred on December 12, 2024 and presented as an expense in the consolidated statements of operations and comprehensive income (loss) for the period ended December 31, 2024.

Additionally, the Company committed to pay a semi-annual fee of $ 65 until ownership transfers or the Technology is no longer licensed, which is accrued on a monthly basis.

During the Successor period from October 2, 2024 through December 31, 2024, $ 11 was recognized within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

Ownership of the Technology will transfer to the Company for a fee of $ 0.5 million contingent upon achievement of a commercial milestone.

The Company incurred a nonrefundable upfront fee of $ 0.5 million under the Technology License, which was immediately expensed as incurred on December 12, 2024 and presented as an expense in the consolidated statements of operations and comprehensive income (loss) for the period ended December 31, 2024.

Additionally, the Company committed to pay a semi-annual fee until ownership transfers or the Technology is no longer licensed, which is accrued on a monthly basis.

During the year ended December 31, 2025 and 2024, an immaterial amount was recognized within General and administrative expense in the consolidated statements of operations and comprehensive income (loss).

Under the Technology License, the Company is committed to pay annual royalties based on Refinity related gross sales and licensing revenue starting in 2025.

As of December 31, 2024, no royalty payments were made to the third party.

Business Segment Data

The Company’s Chief Executive Officer is the Chief Operating Decision Maker (“CODM”) of the Company.

The CODM makes operating decisions, allocates resources and assesses performance based on review of historical and potential future product sales, operating expenses, and net income (loss).

As of December 31, 2025, no royalty payments were made or accrued for under the commitment.

Innventure, Inc.

1 unchanged sentence

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

Framework Agreement

On January 22, 2025, Refinity entered into the Framework Agreement (“Framework Agreement”) with a third party to obtain research services focusing on the further development and optimization of the Gasification Technology.

Refinity agreed to pay a minimum fee of € 2.0 million for the period beginning January 22, 2025 and ending April 30, 2026 (“Year 1”), and € 3.0 million for the period beginning May 1, 2026 and ending April 30, 2027 (“Year 2”);

provided that, if the third party is unable to provide all of the services contemplated to be provided during Year 1 due to its resource constrains, any unused portion of the minimum fee for Year 1 will be deferred to Year 2 and added to the Year 2 minimum fee.

Expenses for services from contracts under the Framework Agreement are recognized as incurred and are applied to the minimum fee.

During the year ended December 31, 2025, Refinity incurred € 1.7 million of service expenses toward the Year 1 minimum fee.

After currency conversion, Refinity incurred $ 1.9 million toward the Year 1 minimum fee during the year ended December 31, 2025.

Additionally, during the year ended December 31, 2025, Refinity made payments of $ 2.0 million on costs incurred as a part of the Year 1 minimum fee.

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

Business Segment Data

The Company’s Chief Executive Officer is the Chief Operating Decision Maker (“CODM”) of the Company.

The CODM makes operating decisions, allocates resources and assesses performance based on review of historical and potential future product sales, operating expenses, and net income (loss).

Based on the information utilized by the CODM to operate the Company, there is one operating segment and reportable segment, Technology.

5 unchanged sentences

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

(in thousands) (in thousands)

Revenue from external customers $ 1,557 $ 233 $ 95

10 unchanged sentences

Income tax expense (benefit) ( 13,571 ) ( 3,637 ) 432

Goodwill Impairment 346,557 — —

Other ** 2,435 168 1,832

6 unchanged sentences

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The following table reconciles the reportable segment to amounts reflected in our consolidated financial statements.

Successor Predecessor

October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024 Year ended December 31, 2023

December 31, 2025 October 2, 2024 through December 31, 2024 January 1, 2024 through October 1, 2024

Technology $ 1,557 $ 233 $ 95

5 unchanged sentences

Other 9,865 1,240 1,069

Elimination of Intercompany Interest ( 486 ) —

Consolidated Interest Expense $ 10,234 $ 1,330 $ 1,633

2 unchanged sentences

Other 903 198 326

Elimination of Intercompany Interest ( 486 ) — —

Consolidated Interest Income $ 556 $ 198 $ 333

10 unchanged sentences

Segment assets are not reviewed by the CODM and therefore are not disclosed.

Subsequent Events

In connection with the preparation of the consolidated financial statements and related disclosures for the period ended December 31, 2024, management has evaluated events through April 14, 2025, which is the date the consolidated financial statements were available to be issued.

Events occurring after December 31, 2024 are:

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

The Company sold 422,999 of Accelsius Series A Units for aggregate proceeds of approximately $ 5,150 .

This amount will be reflected in non-controlling interests in the consolidated statements of changes in stockholders' equity (deficit) in future periods.

As part of the term loan agreement with AeroFlexx, AeroFlexx did not raise equity financing up to the target amount by January 1, 2025 as discussed in Note 3.

Therefore, on January 2, 2025, $ 7,250 of outstanding principal and accrued interest was subject to mandatory conversion.

Using the price per unit of $ 6.83 , the Company obtained 1,060,747 Class D preferred units through the mandatory conversion.

Based on the increase of Class D preferred units, the Company’s updated ownership percentage in AeroFlexx is 38 %.

On January 7, 2025, the VWAP Completion Event, as discussed in Note 10.

Earnout Shares, occurred and 344,828 Sponsor Earnout Shares vested and were no longer subject to contingencies.

As part of the Company’s SEPA with Yorkville, on January 7, 2025, the Company sold 50,000 shares of Common Stock to Yorkville for aggregate proceeds of approximately $ 633 .

On January 22, 2025, the Company issued and sold 4,617 Common Shares for aggregate proceeds of approximately $ 57 .

On January 30, 2025, the Company issued and sold 19,376 Common Shares for aggregate proceeds of approximately $ 235 .

The remaining shares that could be sold to Yorkville are 4,209,314 .

The Board determined that as of January 8, 2025, the creation of Refinity, a consolidated subsidiary of the Company, satisfied the vesting condition applicable to Milestone 2 of the Company Earnout Shares.

As such, 2,000,000 shares of common stock were issued on February 4, 2025 as a result of the satisfaction of the Milestone.

On January 22, 2025, Refinity entered into a framework agreement with a third party for research services focusing on the further development and optimization of licensed technology, as well as the enhancement and improvement of plastic recycling through pyrolysis.

As part of this agreement, Refinity has agreed to pay a minimum fee of € 5,000 during the period beginning May 1, 2025, and ending April 30, 2027, with the stipulation that € 2,000 be paid in the first 12-month period and € 3,000 in the second 12-month period.

On February 1, 2025, the Company entered into a consulting agreement with a third party for services in respect of public relations and investor communications.

The agreement includes monthly compensation of 2,500 shares of the Company's common stock issued each month services are provided.

The initial term of the agreement is for one year and may be terminated by either party upon seven days ’ notice.

On February 3, 2025, and February 27, 2025, two of the Company’s Series 1 Promissory Notes, discussed in Note 5.

Borrowings, matured in an aggregate amount of $ 300 and were paid as they became due.

On February 3, 2025, the Company issued 85,471 shares of Common Stock for financial advisory and investment banking services rendered.

On February 26, 2025, the Company entered into two Nonqualified Stock Option Agreements, which granted 140,000 nonqualified option rights (the “Option”) to two individuals, pursuant to the terms of the Plan.

According to the Nonqualified Stock Option Agreements, and subject to the terms and conditions of the Nonqualified Stock Option Agreements and the Plan, upon vesting of the Options, the holders will have the option to purchase Common Stock of the Company, at an exercise price of $ 8.84 per share (which is equal to the Fair Market Value of the stock on the grant date).

The Options have a term of ten years and will vest and become exercisable with respect to 25 % of the shares of Common Stock underlying the Option on February 26, 2026 and 75 % of the shares of Common Stock underlying the Option in eight substantially equal installments on each three-month anniversary thereafter.

On March 19, 2025, the Company distributed 21,808 shares of Series B Preferred Stock to represent $ 218 in cumulative dividends for Series B Preferred Stock, covering the period from the initial issue date, as defined in the Certificate of Designation, to December 31, 2024, as a payment in kind at the specified rate.

This action follows the terms outlined in the Certificate of Designation dated October 2, 2024, with a record date for the dividend set for

Innventure, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(in thousands, except share or per share data)

March 5, 2025.

Approved by the Board of Directors, this dividend payment is in accordance with the Investment Agreement dated September 27, 2024.

On March 20, 2025, the Company converted and repaid the $ 14,000 aggregate principal of Related party notes, as discussed in Note 5.

The Company issued 1,732,554 of Series C Preferred Stock and paid $ 375 to the respective parties to settle the Related party notes.

Additionally, the Company issued 578,294 of Series C Preferred Stock to settle outstanding debt for AeroFlexx.

On March 24, 2025, the Company entered into the Series C Purchase Agreements with certain purchasers (the “Purchasers”), pursuant to which the Company agreed to issue and sell to the Purchasers an aggregate of up to 275,000 shares of Series C Preferred Stock in a private placement, at a price of $ 10.00 per share of Series C Preferred Stock, resulting in an aggregate purchase price of approximately $ 2,750 before deducting fees and other estimated offering expenses.

These shares are issued with an 8.0 % annual cumulative dividend, a mandatory conversion to Common Stock five years after issuance, and an optional conversion, at the election of the holder, at any time prior to the Maturity Date upon the effectiveness of a registration statement by the Company registering the underlying shares of Common Stock issuable upon conversion.

In connection with the Series C Purchase Agreements, the Company received an aggregate amount of $ 1,500 in advanced funds.

In consideration of these funds, the Company issued 150,000 shares of Series C Preferred Stock to the respective parties.

On March 24, 2025, the Company issued an aggregate of 300,000 shares of Series C Preferred Stock for financial advisory and merchant banking services rendered.

On March 25, 2025, the Company entered into a securities purchase agreement related to the issuance and sale of convertible debentures (“Convertible Debentures”) with an aggregate principal amount of up to $ 30,000 .

These Convertible Debentures will be convertible into shares of the Company’s Common Stock (as converted, the “Conversion Shares”).

On the first business day after certain closing conditions are met, including the timely filing of this Form 10-K, the Company will issue $ 20,000 in aggregate principal amount of Convertible Debentures (the “First Closing Date”).

Additionally, the Company will issue an additional $ 10,000 in aggregate principal amount of Convertible Debentures after both (i) the registration statement filed with the SEC registering the resale of the Conversion Shares is declared effective by the SEC, and (ii) the Company receives stockholder approval.

The Convertible Debentures will not bear interest unless an event of default occurs, in which case they will bear interest at an annual rate of 18 %.

They will mature 15 months after the First Closing Date and can be converted into shares of the Company’s Common Stock at a conversion price to be determined.

These Convertible Debentures were issued at an original issue discount of 10 %.

In connection with this agreement, the Company agreed to issue warrants to purchase up to 300,000 shares of Common Stock to the WTI Lenders.

These warrants serve as consideration for the WTI Lenders’ consent to the transaction.

The warrants have an exercise price of $ 0.01 per share and are exercisable until March 31, 2035, with additional customary rights and protections.

Table of C ontents

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

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 8. Financial Statements and Supplementary Data