What changed in this filing

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Item 1. Business

2026-03-24 compared with 2025-03-13 · 231 added, 176 removed, 172 unchanged (70% of the section changed)

1 unchanged sentence

Environmental Services, Inc.

(the Company, which may be referred to as we, us, or our), a Delaware corporation incorporated in December

1990, is an environmental and environmental technology know-how company.

principal element of our business strategy consists of upgrading our facilities within our Treatment Segment to increase efficiency and

modernize and expand treatment capabilities to meet the changing markets associated with the waste management industry.

Within our Services

Segment, we are attempting to increase competitive procurement effectiveness and broaden the market penetration within both the commercial

and government sectors.

We continue to increase our focus on expansion into both commercial and international markets (see “Foreign

Revenue and Initiatives” below for further discussion of our international initiatives to supplement government spending in the

United States of America (“USA”), from which a significant portion of our revenue is derived).

This includes new services,

new customers and increased market share in our current markets.

were disappointed with our 2024 financial results, which were negatively impacted by a number of unexpected events and factors.

events and factors included among other things,

Resolution (“CR”) impacts primarily in the first half of 2024, that directly resulted in delays in project starts for

existing services backlogs along with delays in procurement cycles for pipeline projects;

weather conditions, including two hurricanes, which resulted in delays in waste shipments and project mobilization activities by

certain customers and power outages and plant shutdowns at certain of our treatment facilities;

outages at certain of our facilities for equipment replacement and repairs, program enhancement and testing to support permit expansion

and broader market penetration, which contributed to revenue production delays;

investments in R&D of our new technology to treat PFAS (Per- and polyfluoroalkyl substances), which required significant management

and operation support, thereby also limiting resources needed for revenue production;

of two large projects in the fourth quarter of 2023 in the Services Segment that were not replaced by new projects of similar value.

we are disappointed with our 2024 financial results, we believe our base business is positioned for improvement and we expect that our

results of operations should improve in 2025.

We continue to advance a number of initiatives that are discussed within this report.

of these initiatives have been realized, with additional initiatives expected to be more fully realized in 2025.

In December 2024, BWXT

Technologies, Inc (“BWXT”) announced that the U.S.

Department of Energy (“DOE”) had awarded BWXT and its team,

of which we are a member, the contract for the cleanup operations at the West Valley Development Project in West Valley, NY.

by BWXT, the contract has a 10-year ordering period with a maximum value of up to $3 billion that can be performed for up to 15 years.

The scope attributable to us has not yet been defined and is subject to certain approvals.

The West Valley Project is anticipated to

begin transition in the first quarter of 2025 and realize full operations 120 days from initiation.

Also, as previously disclosed, in

December 2023 we and our Italian team partner were awarded a multi-year contract for the treatment of radioactive waste from the Joint

Research Center in Ispra, Italy (see “Foreign Revenue and Initiatives” below for a discussion of this contract and further

international initiatives).

continuing initiatives include, among other things, positioning ourselves for further large and mid-size procurements within the DOE

Department of Defense (“DOD”) and waste treatment in support of DOE’s Hanford closure strategy, continued

investments in our facilities and capabilities to allow for broader waste treatment (including PFAS) (see “New Processing Technology”

below for a discussion of our PFAS technology), and continued expansion of our waste treatment offerings within the international and

commercial markets.

we expect our financial results to improve in 2025, uncertainties exist regarding how future federal government budget and program and

policy decisions will unfold, which include the spending priorities of the new Administration and Congress, passage of the 2025 fiscal

government budget and potential for enactment of additional continuing resolutions to keep government departments and agencies

in operations.

A significant amount of our revenues are generated indirectly as subcontractors for others who are contractors to federal

government authorities, which include the DOE and DOD, or directly as the prime contractor to federal government authorities.

impact of these uncertainties could negatively impact our financial results by impairing our ability to perform work on existing contracts,

delaying or cancelling procurement actions by government entities, and/or cause other disruptions or delays, including payment delays.

(the “Company,” which may be referred to as we, us, or our), a Delaware corporation

incorporated in December 1990, is a nuclear services company and leading provider of nuclear and mixed waste management services.

The Company’s nuclear waste services include treatment and management of radioactive and mixed waste (waste containing both

hazardous and low-level radioactive waste).

The Company’s nuclear services group provides project management, environmental

restoration, decontamination and decommissioning (“D&D”), new build construction, and radiological protection, safety, and industrial hygiene (“IH”) capability to our clients.

Through our research and development (“R&D”) laboratories, located within our licensed and permitted waste

treatment facilities, we develop solutions that are not only effective but also practical and economical for our customers.

“—New Processing Technology,” below.

Headquartered

in Atlanta, Georgia, we also pursue waste projects in Canada, Mexico, the United Kingdom, and countries in the European Union (“EU”).

For waste generated by international customers, waste treatment is performed in our U.S.

treatment facilities and returned to our international

Our corporate office is located at 8302 Dunwoody Place, Suite 250, Atlanta, Georgia 30350.

2025, we generated modest consolidated revenue growth year-over-year, while delivering improvements in gross profit and operating performance

driven primarily by a rebound in our Treatment Segment.

Treatment Segment benefited from higher waste volumes and higher averaged price

waste mix, which included higher revenue generated from international and commercial clients.

In contrast, the Services Segment experienced

lower revenue, due in part to delays in project mobilization and delays in procurements that resulted from changes initiated by the current

presidential administration that began in January 2025 (the “Administration”) and supporting policies that occurred in the

first half of 2025.

The partial federal government shutdown that occurred effective October 1, 2025, also negatively affected our revenue

as procurement timing cycles were impacted.

believe we are positioned for potential improvements in our financial results in 2026.

These expectations are based on

management’s current assumptions regarding the timing and execution of anticipated waste treatment volumes, including the

commencement and ramp-up of activities associated with the Direct-Feed Low-Activity Waste (“DFLAW”) program at Hanford,

Washington, described below, as well as our ability to convert existing Treatment Segment backlog into processed revenue.

Segment backlog as of December 31, 2025, was approximately $11,861,000, representing an increase of approximately 50.9% from

Treatment Segment backlog of $7,859,000 as of December 31, 2024.

However, Treatment Segment backlog does not guarantee immediate

revenue, as the timing of backlog processing may vary based on waste complexity, customer requirements, and operational

considerations.

As noted above, however, we believe that our Perma-Fix Northwest Richland, Inc.

(“PFNWR”) treatment

facility, located in Richland, Washington immediately adjacent to the Hanford Nuclear Site, is positioned to support the DFLAW

program at Hanford, which began hot commissioning of the Low-Activity Waste Vitrification Facility at Hanford in October 2025.

subsequent operational phase of the DFLAW program is anticipated to begin in 2026, which will include generation of several effluent

waste streams expected to be treated by our PFNWR facility.

We have made investments in expansion of treatment capacity, increases

in trained workforce, and infrastructure upgrades to support the increases in waste receipts anticipated to begin in the first half

In December 2025, our PFNWR facility received its long-awaited permit renewal from state regulators which, among other

things, approximately triples the facility’s permitted liquid mixed waste processing capacity to approximately 1,200,000

gallons per year and authorizes the facility to process up to 175,000 tons of waste annually through macroencapsulation.

renewal provides incremental capacity and operational flexibility beyond the prior permit and further enhances the facility’s

ability to address a broader range of complex waste treatment requirements.

However, the commencement, scope, and timing of

DFLAW-related waste streams are controlled by the U.S.

Department of Energy (“DOE”) and subject to appropriations,

procurement processes, and operational considerations beyond our control.

As discussed in Management’s Discussion and Analysis

of Financial Condition and Results of Operations, our results of operations are expected to continue to reflect operating losses in

the near term as we incur fixed operating costs and make investments in anticipation of waste treatment volumes and program

continue to focus on expansion into international markets as well as on continued R&D, sales and marketing efforts and capital expenditures

relating to our patent-pending technology for the destruction of Per- and polyfluoroalkyl substances (“PFAS”) (see “Foreign

Revenue and Initiatives” below for a discussion of our foreign revenue and international initiatives and “New Processing

Technology” below for a discussion of our new PFAS technology).

our continuing initiatives include, among other things, positioning ourselves for further large and mid-size procurements within the

Department of War (“DOW”) and waste treatment in support of DOE’s Hanford DFLAW program, continuing investments

in our facilities to allow for broader waste treatment (including PFAS) and continuing expansion of our waste treatment offerings within

the commercial market.

we believe our financial results should show improvement in 2026 over 2025,

the timeliness of annual appropriations for U.S.

government departments and agencies remains a recurrent risk for us.

A significant amount

of our revenues are generated indirectly as subcontractors for others who are contractors to federal government authorities, which include

the DOE and DOW, or directly as the prime contractor to federal government authorities.

Uncertainties exist regarding how future federal

government budgets and program and policy decisions will unfold, which include the spending priorities of Congress and the Administration,

passage of federal government fiscal year annual budgets and potential for enactment of continuing resolutions to keep federal government

departments and agencies in operations.

The full impact of these uncertainties could negatively impact our financial results by impairing

our ability to perform work on existing contracts, delaying or cancelling procurement actions by government entities, and/or cause other

disruptions or delays, including payment delays.

have two reporting segments:

SEGMENT reporting includes:

low-level radioactive, mixed (waste containing both hazardous and low-level radioactive waste), hazardous and non-hazardous waste

treatment, processing and disposal services primarily through four uniquely licensed (Nuclear Regulatory Commission or state equivalent)

and permitted (U.S.

Environmental Protection Agency (“EPA”) or state equivalent) treatment and storage facilities as

SEGMENT, which includes:

low-level radioactive, mixed (waste containing both hazardous and low-level radioactive waste),

hazardous and non-hazardous waste treatment, processing and disposal services primarily through

four uniquely licensed (Nuclear Regulatory Commission or state equivalent) and permitted

Environmental Protection Agency (“EPA”) or state equivalent) treatment

and storage facilities as follow:

Perma-Fix of Florida, Inc.

(“PFF”), Diversified Scientific Services, Inc., (“DSSI”), Perma-Fix Northwest

Richland, Inc.

(“PFNWR”) and Oak Ridge Environmental Waste Operations Center (“EWOC”);

activities to identify, develop and implement innovative waste-processing techniques for problematic waste streams.

(“PFF”), Diversified

Scientific Services, Inc., (“DSSI”), PFNWR and Environmental Waste Operations

Center (“EWOC”);

activities to identify, develop and implement innovative waste-processing techniques for

problematic waste streams.

2025, the Treatment Segment accounted for $45,097,000, or 73.1%, of total revenue, as compared to $34,953,000, or 59.1%, of total revenue

SEGMENT, which includes:

services, which include:

radiological measurement and site survey of large government and commercial installations using advanced methods, technology and

physics services including health physicists, radiological engineers, nuclear engineers and health physics technicians support to

government and private radioactive materials licensees;

Occupational Safety and Health services including industrial hygiene (“IH”) assessments;

hazardous materials surveys,

e.g., exposure monitoring;

○ professional

radiological measurement and site survey of large government and commercial installations

using advanced methods, technology and engineering;

physics services including health physicists, radiological engineers, nuclear engineers and

health physics technicians support to government and private radioactive materials licensees;

○ integrated occupational safety and health services including IH assessments;

hazardous materials surveys, e.g., exposure monitoring;

lead and asbestos management/abatement oversight;

indoor air quality evaluations;

health risk and exposure

health risk and exposure assessments;

health & safety plan/program development, compliance auditing and training services;

and Occupational Safety and

Health Administration (“OSHA”) citation assistance;

technical services providing consulting, engineering (civil, nuclear, mechanical, chemical, radiological and environmental), project

management, waste management, environmental, and decontamination and decommissioning (“D&D”) field, technical, and

management personnel and services to commercial and government customers;

and Occupational

Safety and Health Administration (“OSHA”) citation assistance;

technical services providing consulting, engineering (civil, nuclear, mechanical, chemical,

radiological and environmental), project management, waste management, environmental, and D&D field, technical, and management personnel and services to

commercial and government customers;

management services to commercial and governmental customers.

services, which include:

of government and commercial facilities impacted with radioactive material and hazardous constituents including engineering, technology

applications, specialty services, logistics, transportation, processing and disposal;

termination support of radioactive material licensed and federal facilities over the entire cycle of the termination process:

management, planning, characterization, waste stream identification and delineation, remediation/demolition, final status survey,

compliance demonstration, reporting, transportation, disposal and emergency response.

of government and commercial facilities impacted with radioactive material and hazardous

constituents including engineering, technology applications, specialty services, logistics,

transportation, processing and disposal;

termination support of radioactive material licensed and federal facilities over the entire

cycle of the termination process:

project management, planning, characterization, waste stream

identification and delineation, remediation/demolition, final status survey, compliance demonstration,

reporting, transportation, disposal and emergency response.

company-owned equipment calibration and maintenance laboratory that services, maintains,

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2025, the Services Segment accounted for $16,577,000, or 26.9% of total revenue, as compared to $24,164,000, or 40.9% of total revenue

Treatment and Services Segments provide services primarily to research institutions, commercial companies, public utilities, and governmental

entities, including the DOE and DOD.

However, we continue to increase our focus on expansion into international markets.

The distribution

channels for our services are through direct sales to customers or via intermediaries.

corporate office is located at 8302 Dunwoody Place, Suite 250, Atlanta, Georgia 30350.

Our Treatment and Services Segments provide services to research institutions,

commercial companies, public utilities, and governmental entities, including the DOE and DOW.

We have and continue to increase our services

into international markets.

The distribution channels for our services are through direct sales to customers or via intermediaries.

The principal element of our business strategy consists of upgrading our

facilities within our Treatment Segment to increase efficiency and modernize and expand treatment capabilities to meet the changing markets

associated with the waste management industry.

Within our Services Segment, we are attempting to increase competitive procurement effectiveness

and broaden the market penetration within both the commercial and government sectors.

We have and continue to broaden our market into

both commercial and international sectors (see “Foreign Revenue and Initiatives” below for further discussion of our international

initiatives to supplement our domestic government customer base, from which a significant portion of our revenue is derived).

This includes

new services, new customers and increased market share in our current markets.

Revenue and Initiatives

continue to increase our focus on expansion into international markets.

In 2024, we were awarded contracts in support of waste treatment

services from Mexico and Canada totaling approximately $6,000,000 (US$).

These contracts require specific permits that can include a

six to nine-month approval period.

As such, receipts of these waste shipments are expected in 2025.

We expect additional opportunities

forthcoming in Germany in support of existing commercial clients as well as providing support to Germany’s power utility decommissioning

have and continue to expand our presence in international markets.

Our consolidated revenue for 2025 and 2024 included approximately

$6,440,000, or 10.4%, and $2,452,000, or 4.1%, respectively, from foreign customers (government related and commercial customers), reflecting

an increase of approximately $3,988,000, or 162.6%, from 2024 to 2025.

We anticipate additional opportunities in 2026, including projects

in Canada, Mexico and Germany, supporting both existing commercial and government customers.

To serve our international customers, we

offer unique treatment capabilities to incinerate certain waste forms, providing up to ninety percent reduction in volume and delivering

a stable waste form that can be returned to generators for long-term storage.

previously disclosed, in December 2023, we and our partner, Campoverde Srl, each owning 50% of the partnership, in connection with an

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Revenue generated and to be

generated by us from this contract has been and will be limited to project management support through 2025.

The scope of work in the

initial phases of this contract is being performed predominantly by our partner.

We expect to generate an increase in revenue under this

contract starting in 2026 when the waste treatment phases begin.

The Contracting Authority may terminate the contract under certain conditions

as set forth in the contract.

consolidated revenue for 2024 and 2023 included approximately $2,452,000, or 4.1%, and $2,066,000, or 2.3%, respectively, from foreign

generated by us from this contract has been and will be limited to project management support through the third quarter of 2026.

scope of work in the initial phases of this contract is being performed predominantly by our partner.

We expect to generate an increase

in revenue under this contract in late 2026 when the waste treatment phases begin.

The Contracting Authority may terminate the contract

under certain conditions as set forth in the contract.

Processing Technology.

2024, we completed the fabrication, installation, commissioning and startup of our first full scale commercial Perma-FAS system (“System”)

for PFAS destruction, located at our Perma-Fix Florida, Inc.

PFAS, commonly known as “forever chemicals,” is the

acronym for Perfluoroalkyl and Polyfluoroalkyl Substances, a diverse group of thousands of humanmade chemical pollutants that have the

potential to persist in both the environment and the human body.

An increasing number of studies have documented adverse health risks

that are associated with PFAS exposure, including increased risks of some cancers, reduced immune function, and developmental delays

Commercial destruction of PFAS offers a promising new source of revenue for us, as it complements our core waste remediation

technologies, and wee have filed patent applications relating to our System technology for PFAS destruction.

With the successful startup

of our pilot System, we have already processed commercial quantities of PFAS-containing waste materials.

There are limited current treatment

options for these materials, and we expect that our process will exceed any of these other current methods.

Some of the sizable markets

for PFAS include AFFF (aqueous film-forming foam) firefighting foams, both expired concentrate and flushing liquids, contaminated liquids

from PFAS systems, and other water-based separation products from a variety of industrial systems.

We have already secured and are treating

approximately 6,000 gallons of AFFF liquids to support ongoing operations, demonstration, and further testing of our System.

that we will receive an additional 20,000 gallons in the coming months.

strategy for our System includes continued treatment of PFAS liquids over the coming months and targeting engineering refinements to

support larger-scale Systems.

With significant upgrades to our prototype currently in the design phase, we anticipate deployment of the

second generation unit in the third quarter of 2025 at one of our other existing treatment facilities.

By the third quarter of 2025,

we expect to advance this technology into pilot-scale applications for soil, biosolids, and filter media, broadening the reach of our

System’s PFAS destruction capabilities.

significant upgrades to our prototype Perma-FAS system (“System”) for PFAS destruction substantially completed in the latter

part of 2025, our System has achieved commercial operational status at our PFF facility.

PFAS, commonly known as “forever chemicals,”

is the acronym for Perfluoroalkyl and Polyfluoroalkyl Substances, a diverse group of thousands of human-made chemical pollutants that

have the potential to persist in both the environment and the human body.

An increasing number of studies have documented adverse health

risks that are associated with PFAS exposure, including increased risks of some cancers, reduced immune function, and developmental delays

Federal and state actions addressing PFAS have accelerated in recent years,

including restrictions and bans on the use of aqueous film-forming foam (“AFFF”) containing PFAS for firefighting and training,

as well as requirements governing the collection, handling, and disposal of existing AFFF inventories.

These measures have contributed

to an increasing volume of PFAS-containing materials requiring treatment or destruction rather than reuse or conventional disposal.

We believe these regulatory developments may support increased demand over

time for technologies capable of permanently destroying PFAS compounds, including technologies designed to address concentrated PFAS waste

streams generated from AFFF phase-outs, remediation activities, and downstream treatment processes.

Our thermal treatment and waste processing

capabilities are intended to address certain categories of PFAS-containing materials that may not be suitable for landfilling or other

disposal alternatives.

The extent to which these regulatory trends translate into sustained commercial demand for PFAS destruction services

will depend on a number of factors, including the pace and scope of federal and state implementation, the availability and acceptance

of alternative disposal or treatment methods, customer adoption decisions, and our ability to secure regulatory approvals, contracts,

and operational capacity to meet market needs.

Accordingly, we believe that commercial destruction of PFAS offers a promising

new source of revenue for us, as it complements our core waste remediation technologies.

However, our PFAS technology remains in an early

stage of commercialization, and we continue to incur operating, R&D and capital costs associated with scaling, market development,

and regulatory acceptance.

While we have filed patent applications relating to our System technology for PFAS destruction and are processing

commercial quantities of PFAS-containing waste materials with our System, there can be no assurance that demand, pricing, or throughput

levels will be sufficient in the near term to offset these costs.

Still, we believe that there are limited treatment options currently available

that are intended to permanently destroy these materials, as opposed to managing them through storage or containment, which may be important

to waste generators seeking to address potential long-term environmental liability.

We believe that our System technology exceeds the

performance of other currently available destruction-based methods;

however, adoption and acceptance of any such technology remain subject

to regulatory and market factors.

commercial operation of our System, we anticipate deployment of our second-generation unit in the second half of 2026 at our EWOC facility in Oak Ridge, Tennessee, which we believe will allow us to triple

our production capacity.

We continue to market our System technology through various channels.

In December 2025, we entered into a joint

distribution agreement with a U.S.-based company that manufactures fluorine-free firefighting agents and compressed air foam system, to

promote our PFAS destruction technology as a preferred treatment options for customers requiring, compliant, long-term destruction of

legacy PFAS stockpiles.

In the next several calendar quarters, we expect to further advance our Perma-FAS technology from demonstrated

successful bench-scale testing to pilot-scale applications for soil, biosolids, and filter media, broadening the reach of our System’s

PFAS destruction capabilities.

Factors of our Business

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and financial condition.

The permits and licenses have terms ranging from one to ten years, and provide that we maintain a reasonable

level of compliance, and renew with minimal effort and cost.

We believe that these permit and license requirements represent a potential

barrier to entry for possible competitors.

The permits and licenses have terms ranging from one to ten years, and provide that we maintain certain level

of compliance, and renew with minimal effort.

We believe that these permit and license requirements represent a potential barrier to

entry for possible competitors.

located in Gainesville, Florida, operates its hazardous, mixed and low-level radioactive waste activities under a Resource Conservation

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comprising our Treatment Segment are very difficult to obtain for a single facility and make this Segment unique.

believe that the permitting and licensing requirements, and the cost to obtain such permits, are barriers to the entry of hazardous waste

and radioactive and mixed waste activities as presently operated by our waste treatment subsidiaries.

If the permit requirements for

hazardous waste treatment, storage, and disposal (“TSD”) activities and/or the licensing requirements for the handling of

low-level radioactive matters are eliminated or if such licenses or permits were made less rigorous to obtain, we believe we would face

greater competition in this segment.

believe that the permitting and licensing requirements, and the cost to obtain such permits, are barriers to entry for companies seeking to conduct hazardous waste and radioactive

and mixed waste activities as presently operated by our waste treatment subsidiaries.

If the permit requirements for hazardous waste treatment,

storage, and disposal (“TSD”) activities and/or the licensing requirements for the handling of low-level radioactive matters

are eliminated or if such licenses or permits were made less rigorous to obtain, we believe we would face greater competition in this

of December 31, 2025, we employed approximately 307 employees, of whom 293 are full-time employees and 14 are part-time/temporary employees.

previously disclosed, the Company entered into a Project Labor Agreement (“PLA”), dated June 21, 2023, with UA Plumbers &

Steamfitters Local 598.

The goal of this partnership is to supply our PFNWR facility with the organized labor force needed to take on

the challenges of providing a supplement treatment alternative to include concrete-like grout for Hanford’s Low Activity Tank Waste

if and when the DOE grants a contract to PFNWR to treat the Low Activity Tank Waste.

We believe that this supplemental capability would

support DOE’s glassifying process provided by the Hanford Vitrification Plant for safe transport and disposal off-site of the Low

Activity Tank Waste.

of our employees are covered under a Collective Bargaining Agreement (the “CBA”) dated September 25, 2025, that our wholly

owned subsidiary, PFNWR entered into with the United Association of Plumbers and Steamfitters Local Union 598 (the “Union”).

The CBA became effective October 1, 2025, and its purpose is to attempt to maintain a skilled and stabilized labor force for its waste

treatment operations.

term of the CBA is October 1, 2025, through October 1, 2030, and the CBA renews automatically on an annual basis thereafter, unless either

PFNW or the Union gives written notice at least sixty days prior to October 1, 2030, of its intent to modify or terminate the CBA.

Upon a Single or Few Customers

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from our Treatment and Services Segments are generated indirectly as subcontractors for others who are contractors to federal government

authorities, particularly the DOE and DOD, or directly as the prime contractor to federal government authorities.

authorities, particularly the DOE and DOW, or directly as the prime contractor to federal government authorities.

The contracts that

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in the level of federal governmental funding in any given year could have a material adverse impact on our operations and financial condition.

performed services relating to waste generated by federal government clients, either indirectly for others as a subcontractor to federal

government entities or directly as a prime contractor to federal government entities, representing approximately $40,550,000 or 68.6%

of our total revenue during 2024, as compared to $68,595,000 or 76.4% of our total revenue during 2023.

Our revenue derived from federal government entities, either directly as a prime contractor or indirectly for others as subcontractor

to federal government entities, totaled $39,243,000, or 63.6% of total revenue in 2025, compared to $40,550,000, or 68.6% of total revenue

revenues are project/event based where the completion of one contract with a specific customer may be replaced by another contract with

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There are a number of qualified small

businesses in our market that will provide intense competition that may challenge our ability to maintain strong growth rates and acceptable

businesses in our market that provide intense competition that may challenge our ability to maintain strong growth rates and acceptable

profit margins.

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could lose market share and experience an overall reduction in its profits.

Environmental Expenditures and Potential Environmental Liabilities

Environmental Expenditures and Environmental Liabilities

Environmental

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state regulators.

of December 31, 2024, we had total accrued environmental remediation liabilities of $767,000, a decrease of $78,000 from the December

of December 31, 2025, we had total environmental remediation liabilities of $3,485,000, an increase of $2,718,000 from the December

31, 2024, balance of $767,000.

The decrease represents payments for our PFSG remediation project.

As of December 31, 2024, $1,000 of

the total accrued environmental liabilities was recorded as current.

nature of our business exposes us to significant cost to comply with governmental environmental laws, rules and regulations and risk

The net increase of approximately $2,718,000 reflects an increase of approximately $2,721,000 made to the

reserve at our PFSG subsidiary following a reassessment of remediation cost estimates after clarification of the remediation plan from

the state regulator, offset by payments of approximately $3,000 for our PFSG remediation project.

As of December 31, 2025, approximately

$76,000 of our total environmental remediation liabilities were recorded as current.

nature of our business exposes us to significant costs to comply with governmental environmental laws, rules and regulations and risk

of liability for damages.

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and technical know-how by our operations is very important to the success of our business.

Our goal is to discover, develop and bring

to market innovative ways to process waste that address unmet environmental needs.

We conduct research internally, and also through collaborations

with other third parties.

The majority of our research activities are performed as we receive new and unique waste to treat.

Our competitors

also devote resources to R&D and many such competitors have greater resources at their disposal than we do.

R&D totaled $1,172,000

and $561,000 for 2024 and 2023, respectively.

The increase in our R&D expenses was attributable primarily to R&D in connection

with developing our new technology in treating PFAS (See “New Processing Technology” above for a discussion of this new technology).

Our goal is to discover, develop and

bring to market innovative ways to process waste that address unmet environmental needs.

We conduct research internally and through

collaborations with other third parties.

The majority of our research activities are performed as we receive new and unique waste to

Our competitors also devote resources to R&D and many such competitors have greater resources at their disposal.

totaled $1,291,000 and $1,172,000 for 2025 and 2024, respectively.

Our R&D expenses for each of the years 2025 and 2024

consisted primarily of R&D in connection with the development of our new technology in treating PFAS (See “New Processing

Technology” above for a discussion of this new technology).

Environmental

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equipment safety hazards and exposure to hazardous chemicals.

Atomic Energy Act of 1954 governs the safe handling and use of Source, Special Nuclear and Byproduct materials in the U.S.

Atomic Energy Act of 1954 (“AEA”) governs the safe handling and use of source, special nuclear and byproduct materials (as

defined in the AEA) in the U.S.

and its territories.

This act authorized the Atomic Energy Commission (now the Nuclear Regulatory Commission “USNRC”) to enter into “Agreements

with states to carry out those regulatory functions in those respective states except for Nuclear Power Plants and federal facilities

like the VA hospitals and the DOE operations.” The State of Florida Department of Health (with USNRC oversight), Office of Radiation

Control, regulates the licensing and radiological program of the PFF facility;

the State of Tennessee (with USNRC oversight), Tennessee

Division of Radiological Health, regulates licensing and the radiological program of the DSSI facility and the EWOC facility;

State of Washington (with USNRC oversight) Department of Health, regulates licensing and the radiological operations of the PFNWR facility.

This act authorized the Atomic Energy Commission (now the Nuclear Regulatory Commission

“USNRC”) to enter into “Agreements with states to carry out those regulatory functions in those respective states except

for Nuclear Power Plants and federal facilities like the VA hospitals and the DOE operations.” The State of Florida Department

of Health (with USNRC oversight), Office of Radiation Control, regulates the licensing and radiological program of the PFF facility;

the State of Tennessee (with USNRC oversight), Tennessee Division of Radiological Health, regulates licensing and the radiological program

of the DSSI facility and the EWOC facility;

and the State of Washington (with USNRC oversight) Department of Health, regulates licensing

and the radiological operations of the PFNWR facility.

activities are subject to other federal environmental protection and similar laws, including, without limitation, the Clean Water Act,

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

What changed 10-K

Item 1. Business