What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-03-04 compared with 2025-03-05 · 544 added, 290 removed, 1233 unchanged (40% of the section changed)

4 unchanged sentences

We evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2025, with the participation of our CEO and CFO, as well as other key members of our management.

this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of December 31, 2024.

Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of December 31, 2025.

Management's Annual Report on Internal Control Over Financial Reporting

13 unchanged sentences

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria .

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for the years then ended, and the related notes and our report dated March 5, 2025 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and our report dated March 4, 2026 expressed an unqualified opinion thereon.

Basis for Opinion

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Other Information

On November 13, 2024 , Corey Riley , our Chief Information Officer and Chief Compliance Officer , adopted a trading plan intended to satisfy the affirmative defense of Rule 10b5-1(c) providing for the sale of up to 14,000 shares of Common Stock.

The expiration date for Mr.

Riley's plan is November 12, 2025 .

Except as disclosed above, during the quarter ended December 31, 2024, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

On June 29, 2025, Bobby Riley, our Chief Executive Officer, adopted a trading plan intended to satisfy the affirmative defense of Rule 10b5-1(c) providing for the sale of up to 50,000 shares of Common Stock.

The expiration date for Bobby Riley's plan is August 31, 2026.

On July 12, 2025, Corey Riley, our Chief Information and Compliance Officer, adopted a trading plan intended to satisfy the affirmative defense of Rule 10b5-1(c) providing for the sale of up to 14,000 shares of Common Stock.

The expiration date for Corey Riley's plan is November 30, 2026.

Except as noted above, during the year ended December 31, 2025, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

On March 3, 2026, the Company entered into Amendment No.

1 (the “Amendment”) to the Amended and Restated Employment Agreement, dated March 26, 2025, with Bobby D.

Riley, the Company’s Chief Executive Officer.

The Amendment increases the change-in-control severance multiple set forth in Section 8(b) of the employment agreement from 200% to 300% of Mr.

Riley’s base salary and annual bonus for purposes of calculating the change-in-control payment.

Except as expressly amended by the Amendment, the employment agreement remains in full force and effect.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

5 unchanged sentences

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Information as to Item 12 will be set forth in our definitive proxy statement, which is to be filed pursuant to Regulation 14A with the SEC within 120 days after the close of the year ended December 31, 2024.

Except as provided below, information as to Item 12 will be set forth in our definitive proxy statement, which is to be filed pursuant to Regulation 14A with the SEC within 120 days after the close of the year ended December 31, 2025.

Outstanding Equity Awards

Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities in Column (a))

Equity Compensation Plans Approved by Security Holders — — 346,645

Equity Compensation Plans Not Approved by Security Holders — — —

Total — — 346,645

Certain Relationships and Related Transactions, and Director Independence

16 unchanged sentences

1 to Agreement and Plan of Merger, by and among Tengasco, Inc., Antman Sub, LLC, and Riley Exploration - Permian, LLC, dated as of January 20, 2021 (incorporated by reference from Exhibit 2.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on January 22, 2021).

Securities Purchase Agreement dated May 3, 2025, by and between Silverback Legacy, LLC and Silverback Blocker, LLC, as Seller, and Riley Exploration - Permian, LLC, as Purchaser (incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on May 7, 2025).

Purchase and Sale Agreement dated December 3, 2025, by and between Riley Exploration - Permian, LLC and Targa Northern Delaware LLC (incorporated by reference from Exhibit 2.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on December 4, 2025).

First Amended and Restated Certificate of Incorporation of Riley Exploration Permian, Inc.

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(incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 23, 2022).

Description of Registrant's Securities

Description of Registrant's Securities (incorporated by reference from Exhibit 4.1 to the Registrant’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on March 6, 2024).

Note Purchase Agreement, dated as of April 3, 2023, by and among Riley Exploration - Permian, LLC, as Issuer, Riley Exploration Permian, Inc., as Parent, each of the subsidiaries of the Issuer party thereto as guarantors, each of the holders from time to time party thereto, and U.S.

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Form of Restricted Stock Agreement (Non-Employee Director) (incorporated by reference from Exhibit 4.6 to the Registrant’s Registration Statement on Form S-8 filed with the Commission on March 1, 2021, Registration No.

Employment Agreement dated effective as of March 15, 2021 by and between Riley Exploration Permian, Inc.

and Corey Riley (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021).

Employment Agreement dated effective as of March 15, 2021 by and between Riley Exploration Permian, Inc.

and Philip Riley (incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021).

Employment Agreement dated April 1, 2019 by and between Riley Exploration – Permian, LLC and Bobby D.

Riley and assigned by Riley Exploration – Permian, LLC to Riley Permian Operating Company, LLC on June 8, 2019 (incorporated by reference from Exhibit 10.9 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No.

Amendment No.

1 to Employment Agreement dated October 1, 2020 by and between Riley Permian Operating Company, LLC and Bobby D.

Riley (incorporated by reference from Exhibit 10.10 to the Registrant’s Registration Statement on Form S-4/A, as filed with the Securities and Exchange Commission on December 31, 2020, Registration No.

Amendment No.

2 to Employment Agreement dated March 15, 2021 by and between Riley Permian Operating Company, LLC and Bobby D.

Riley (incorporated by reference from Exhibit 10.7 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 15, 2021).

Employment Agreement, dated as of June 1, 2024, by and between Riley Exploration Permian, Inc.

and Jeffrey M.

(incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on June 3, 2024).

Employment Agreement, dated as of June 20, 2024, by and between Riley Exploration Permian, Inc.

and John Suter.

(incorporated by reference from Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on August 7, 2024).

Amended and Restated Employment Agreement dated March 26, 2025 with an effective date of April 8, 2025, by and between the Company and Corey Riley (incorporated by reference from Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 7, 2025).

Amended and Restated Employment Agreement dated March 26, 2025 with an effective date of April 8, 2025 by and between Riley Exploration Permian, Inc.

and Philip Riley (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 26, 2025)

Amended and Restated Employment Agreement dated March 26, 2025 with an effective date of April 8, 2025 by and between Riley Exploration Permian, Inc.

Riley (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 26, 2025).

Amended and Restated Employment Agreement dated March 26, 2025 with an effective date of April 8, 2025, by and between the Company and Jeffrey M.

Gutman (incorporated by reference from Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 7, 2025).

Amended and Restated Employment Agreement dated March 26, 2025 with an effective date of April 8, 2025, by and between the Company and John Suter (incorporated by reference from Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 7, 2025).

Second Amended and Restated Registration Rights Agreement dated October 7, 2020 by and among Riley Exploration – Permian, LLC, Riley Exploration Group, Inc., Yorktown Energy Partners XI, L.P., Boomer Petroleum, LLC, Bluescape Riley Exploration Holdings LLC, Bluescape Riley Acquisition Company LLC, Bobby D.

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Form of Common Stock Award Agreement, as amended and restated as of April 21, 2023 (Incorporated by reference from Exhibit 10.4 to the Registrant's Current Report on Form 8-K, as filed with the Securities and Exchange Commission on April 24, 2023).

Fifteenth Amendment to the Credit Agreement dated as of December 13, 2024, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto.

Form of Restricted Stock Award Agreement (Performance Vesting) (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on March 26, 2025).

Fifteenth Amendment to the Credit Agreement dated as of November 14, 2023, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto.

(incorporated by reference from Exhibit 10.34 to the Registrant’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on March 5, 2025).

Sixteenth Amendment to the Credit Agreement dated as of December 13, 2024, by and among Riley Exploration Permian, Inc., Riley Exploration - Permian, LLC, as borrower, Truist Bank, as administrative agent, and the lenders party thereto.

(Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on December 18, 2024).

Insider Trading Policy

Amendment No.

1 to Amended and Restated Employment Agreement dated March 3, 2025 with an effective date of March 3, 2026 by and between Riley Exploration Permian, Inc.

Insider Trading Policy (incorporated by reference from Exhibit 19.1 to the Registrant’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on March 5, 2025).

Subsidiaries of the Registrant

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Riley Exploration Permian, Inc.

Clawback Policy Effective December 1, 2023

Clawback Policy Effective December 1, 2023 (incorporated by reference from Exhibit 97.1 to the Registrant’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on March 6, 2024).

Report of Ryder Scott Company, L.P.

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March 4, 2026

/s/ Bobby Riley

Chairman of the Board and Chief Executive Officer

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Signature Title Date

Riley Chairman of the Board and Chief Executive Officer

/s/ Bobby Riley

Chairman of the Board and Chief Executive Officer

(Principal Executive Officer)

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Rebecca Bayless

Director March 4, 2026

Bobby Saadati

INDEX TO FINANCIAL STATEMENTS

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We have audited the accompanying consolidated balance sheets of Riley Exploration Permian, Inc.

(the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for the years then ended, 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 2023, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

(the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for each of the three years in the period 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 at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 , in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and our report dated March 4, 2026 expressed an unqualified opinion thereon.

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

The communication of the critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Estimation of Future Production Volumes Used to Estimate Proved Oil and Natural Gas Reserves and the Associated Effect on Depreciation, Depletion and Amortization (“DD&A”) Expense Related to Proved Oil and Natural Gas Properties

4 unchanged sentences

We have identified the estimation of future production volumes used to estimate proved oil and natural gas reserves and the associated effect on DD&A expense related to proved oil and natural gas properties as a critical audit matter.

Estimating future

production volumes involves a high degree of subjectivity from management and their internal and independent petroleum engineers.

Estimating future production volumes involves a high degree of subjectivity from management and their internal and independent petroleum

Changes in this estimate could have a significant effect on the measurement of DD&A expense.

4 unchanged sentences

• Performing a retrospective review over management estimates of future production volumes made in prior periods as compared to actual results.

Estimation of Future Production Volumes Used to Estimate Fair Value of the Acquired Oil & Natural Gas Properties in the Silverback Acquisition

As disclosed by management and described in Note 4 to the consolidated financial statements, the Company completed the Silverback Acquisition for approximately $122.7 million.

The Company recognized oil and natural gas properties of $140.1 million, which are included in oil and natural gas properties, net within the Company’s consolidated balance sheet.

To determine the acquisition date fair value of the oil and natural gas properties, management used internal engineers to make significant estimates, including estimating the future production volumes of the acquired oil and natural gas reserves.

We have identified the estimation of future production volumes used to estimate the fair value of the acquired oil and natural gas properties in the Silverback Acquisition as a critical audit matter.

Estimating future production volumes involves a high degree of subjectivity from management and their internal petroleum engineers.

Changes in this estimate could have a significant effect on the fair value of the acquired oil and natural gas properties.

Auditing the estimation of future production volumes required subjective and complex auditor judgement.

The primary procedures we performed to address this critical audit matter included:

• Evaluating the professional qualifications and objectivity of the internal petroleum engineers, including their relationship to the Company.

• Assessing the reasonableness of the future production volumes by comparing estimates of future production volumes against historical results of production volumes on a summary basis for all wells and on a detailed basis for certain wells.

• Performing a retrospective review over management estimates of future production volumes made in the acquisition date fair value forecast as compared to actual results.

/s/ BDO USA, P.C.

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Equity method investment 36,188 22,811

Funds held in escrow 1,196 —

Other non-current assets, net 15,899 10,706

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

0 shares issued and outstanding

0 shares issued

Common stock, $ 0.001 par value, 240,000,000 shares authorized;

21,482,555 and 20,405,093 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively

21,718,800 and 21,482,555 shares issued at December 31, 2025 and December 31, 2024, respectively

Additional paid-in capital 306,660 310,232

7 unchanged sentences

Year Ended December 31,

2025 2024 2023

(In thousands, except per share amounts)

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Administrative costs 31,472 26,551 26,569

Share-based compensation expense 8,138 6,833

Stock-based compensation expense 9,130 8,138 6,833

Cost of contract services - related parties — 363 579

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Loss from equity method investment ( 886 ) ( 721 ) ( 218 )

Gain on midstream sale 71,675 — —

Total Other Income (Expense) 75,684 ( 36,724 ) ( 25,841 )

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Shareholders' Equity

Shares Amount Additional Paid-in Capital Retained Earnings

Total Shareholders' Equity

Shares Amount Additional Paid-in Capital Retained Earnings Total Shareholders' Equity

Balance, December 31, 2022 20,161 $ 20 $ 274,643 $ 58,783 $ 333,446

Share-based compensation expense 315 — 6,978 — 6,978

Stock-based compensation expense 315 — 6,978 — 6,978

Repurchased shares for tax withholding ( 80 ) — ( 2,511 ) — ( 2,511 )

3 unchanged sentences

Balance, December 31, 2023 20,405 $ 20 $ 279,112 $ 142,463 $ 421,595

Share-based compensation expense 155 — 8,138 — 8,138

Stock-based compensation expense 155 — 8,138 — 8,138

Repurchased shares for tax withholding ( 92 ) — ( 2,432 ) — ( 2,432 )

Issuance of common shares, net 1,015 1 25,414 — 25,415

1,015 1 25,414 — 25,415

Dividends declared — — — ( 30,998 ) ( 30,998 )

1 unchanged sentence

Balance, December 31, 2024 21,483 $ 21 $ 310,232 $ 200,362 $ 510,615

Stock-based compensation expense 574 1 9,129 — 9,130

Repurchased shares for tax withholding ( 88 ) — ( 2,481 ) — ( 2,481 )

Repurchase and retirement of shares ( 250 ) — ( 10,220 ) — ( 10,220 )

Dividends declared — — — ( 33,642 ) ( 33,642 )

Net income — — — 160,840 160,840

Balance, December 31, 2025 21,719 $ 22 $ 306,660 $ 327,560 $ 634,242

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

Year Ended December 31,

2025 2024 2023

(In thousands)

9 unchanged sentences

Amortization of deferred financing costs and discount 4,768 5,299 4,161

Share-based compensation expense 8,138 6,978

Stock-based compensation expense 9,130 8,138 6,978

Deferred income tax expense 11,352 3,202 27,589

Loss from equity method investment 886 721 218

Gain on midstream sale

( 71,675 ) — —

Other 2 — ( 25 )

Changes in operating assets and liabilities

Accounts receivable ( 9,285 ) ( 9,575 )

Prepaid expenses and other current assets ( 53 ) ( 717 )

Accounts receivable, net 12,357 ( 9,285 ) ( 9,575 )

Prepaid expenses ( 290 ) ( 53 ) ( 717 )

Inventory 274 1,512 ( 546 )

Other non-current assets ( 994 ) ( 1,179 )

Other non-current assets, net ( 3,401 ) ( 994 ) ( 1,179 )

Accounts payable and accrued liabilities ( 3,729 ) 9,877 3,200

6 unchanged sentences

Additions to other property and equipment ( 1,564 ) ( 875 ) ( 1,065 )

Acquisitions of oil and natural gas properties ( 19,597 ) ( 5,443 )

Net assets acquired in business combination ( 117,702 ) — ( 324,686 )

Acquisitions of oil and natural gas properties ( 2,161 ) ( 19,597 ) ( 5,443 )

Acquisitions of land ( 1,309 ) — —

Disposition of midstream property and equipment 120,204 — —

Contributions to equity method investment ( 15,750 ) ( 17,912 ) ( 3,566 )

Funds held in escrow ( 1,196 ) — —

Net Cash Used in Investing Activities ( 145,769 ) ( 147,838 ) ( 469,556 )

7 unchanged sentences

Repayments of Senior Notes ( 20,000 ) ( 20,000 ) ( 15,000 )

Payment of common share dividends ( 30,831 ) ( 27,706 )

Payment of cash dividends ( 33,325 ) ( 30,831 ) ( 27,706 )

Proceeds from issuance of common shares, net — 25,415 2

Common stock repurchased for tax withholding ( 2,432 ) ( 2,511 )

Repurchase of common shares for tax withholding and other ( 3,248 ) ( 2,432 ) ( 2,511 )

Net Cash Provided by (Used in) Financing Activities ( 62,005 ) ( 100,631 ) 264,379

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Year Ended December 31,

2025 2024 2023

(In thousands)

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Changes in capital expenditures in accounts payable and accrued liabilities $ ( 2,945 ) $ 1,058 $ ( 5,850 )

Transfer of inventory to oil and natural gas properties $ 2,351 $ 29 $ —

Right-of-use assets obtained in exchange for operating lease liability $ 3,139 $ 632 $ 1,277

Net asset transfer for common shares $ 9,453 $ — $ —

Assets contributed to equity method investment $ — $ — $ 2,272

Distributions declared from equity method investment $ 1,487 $ — $ —

Asset retirement obligations assumed in acquisitions $ 19,284 $ 9,727 $ 19,359

Revisions in asset retirement obligations $ 7,724 $ 1,856 $ —

Fair value of contingent consideration transferred in business combination $ 3,100 $ — $ —

The accompanying notes are an integral part of these consolidated financial statements.

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This acquisition included approximately 10,600 total contiguous net acres of leasehold, 18 net horizontal wells and 250 net vertical wells, which established our initial position in New Mexico.

On May 7, 2024, the Company completed the acquisition of oil and natural gas properties in the Yeso trend of the Permian Basin in Eddy County, New Mexico ("2024 New Mexico Asset Acquisition"), which added 13,900 contiguous net acres to the Company's existing acreage in Eddy County.

For further information regarding the 2023 New Mexico Acquisition and the 2024 New Mexico Asset Acquisition (the "2023 and 2024 New Mexico Acquisitions"), see Note 4 - Acquisitions of Oil and Natural Gas Properties.

On May 7, 2024, the Company completed an acquisition of oil and natural gas properties in the Yeso trend of the Permian Basin in Eddy County, New Mexico ("2024 New Mexico Asset Acquisition"), which added 13,900 contiguous net acres to the Company's existing acreage in Eddy County, New Mexico.

On July 1, 2025, the Company completed the acquisition of 100 % of the ownership interests of Silverback Exploration II, LLC and its subsidiaries ("Silverback") which own oil and natural gas assets and operations located primarily in the Yeso trend of the Permian Basin in Eddy County, New Mexico (“Silverback Acquisition”).

The acquisition added approximately 40,000 net acres directly adjacent to and overlapping with the Company's existing core acreage primarily in Eddy County, New Mexico.

For further information regarding the 2023 New Mexico Acquisition, the 2024 New Mexico Asset Acquisition, and the Silverback Acquisition, see Note 4 - Acquisitions and Divestitures.

Current Commodity Environment

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These reclassifications had no effect on the previously reported total assets, total liabilities, shareholders' equity, results of operations or cash flows .

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(3) Summary of Significant Accounting Policies

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GAAP requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes.

These estimates

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

These estimates and assumptions may also affect disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The Company evaluates these estimates on an ongoing basis, using historical experience, consultation with experts and other methods the Company considers reasonable in the particular circumstances.

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These market indices are determined on a monthly basis.

The Company estimates uncollectible amounts based on the length of time that the accounts receivable has been outstanding, historical collection experience and current and future economic and market conditions, if failure to collect is expected to occur.

Allowances for credit losses are recorded as reductions to the carrying values of the accounts receivable included in the Company’s consolidated balance sheets and are recorded in administrative costs in our consolidated statements of operations if failure to collect an estimable portion is determined to be probable.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Accounts receivable, net is summarized below:

3 unchanged sentences

Allowance for credit losses

( 601 ) ( 62 )

Other accounts receivable 4,318 1,215

2 unchanged sentences

As of December 31, 2023, the Company had accounts receivables, net from oil, natural gas and NGL sales of $ 31.1 million.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The Company's inventory represents tangible assets such as drilling pipe, tubing, casing and operating supplies used in the Company's future drilling or repair operations.

The Company accounts for our inventory using the first-in, first-out method and valued at the lower of cost or net realizable value.

The Company accounts for our inventory using the first-in, first-out method and it is valued at the lower of cost or net realizable value.

If the cost of inventory exceeds the net realizable value, we will adjust the carrying amount of inventory to the net realizable value, and record the adjustment in the consolidated statements of operations.

Proved Oil and Natural Gas Properties

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On the sale of a partial unit of proved property, the unamortized cost of the property is apportioned to the interest sold and the interest retained is accounted for on the basis of the fair value of the retained interests and a gain or loss is recognized if the divestiture significantly affects the depletion rate.

These gains or losses would be recognized as a gain (loss) on sale of oil and gas properties in the consolidated statement of operations.

Unproved Oil and Natural Gas Properties

3 unchanged sentences

Upon the sale of an entire interest in an unproved property for cash or cash equivalents, a gain or loss is recognized to the extent of the difference between the proceeds received and the net carrying value of the property.

Proceeds from the sale of partial interests in unproved oil and natural gas properties are accounted for as a recovery of costs unless the proceeds exceed the entire cost of the property.

This gain or loss would be recognized as a gain (loss) on sale of oil and gas properties in the consolidated statement of operations.

Proceeds from the sale

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

of partial interests in unproved oil and natural gas properties are accounted for as a recovery of costs unless the proceeds exceed the entire cost of the property.

Impairment of Oil and Natural Gas Properties

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The Company accounts for business combinations in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 805, Business Combinations.

The Company accounts for our acquisitions

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

that qualify as a business using the acquisition method in which the Company recognizes and measures identifiable assets acquired, liabilities assumed, and any non-controlling interest in the acquired entity at their fair values as of the acquisition date.

The Company accounts for our acquisitions that qualify as a business using the acquisition method in which the Company recognizes and measures identifiable assets acquired, liabilities assumed, and any non-controlling interest in the acquired entity at their fair values as of the acquisition date.

If the set of assets and activities acquired is not considered a business, it is accounted for as an asset acquisition using a cost accumulation model.

12 unchanged sentences

Land costs are accounted for at cost and are not depreciated.

Components of other property and equipment consists of midstream property and equipment, computer equipment, computer software, office furniture, tools and equipment, buildings and improvements, and vehicles.

Midstream property and equipment was not in service as of December 31, 2024.

Components of other property and equipment consisted of computer equipment, computer software, office furniture, tools and equipment, land, buildings and improvements, vehicles, and midstream property and equipment that was sold in 2025 in the Midstream Sale.

Other property and equipment, net is summarized below:

(In thousands)

Midstream property and equipment

Furniture, fixtures and other

1 unchanged sentence

17,983 16,673

Midstream property and equipment

Other property and equipment

$ 25,566 $ 33,852

Accumulated depreciation and amortization

2 unchanged sentences

$ 21,872 $ 30,477

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Deferred Financing Costs

7 unchanged sentences

The issuance costs are expensed in our consolidated statements of operations if the issuance is unsuccessful.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Other Non-Current Assets, net

3 unchanged sentences

Right-of-use assets

Prepaid capital expenditures 2,116 2,124

Deposits 4,846 2,168

Total other non-current assets, net $ 15,899 $ 10,706

10 unchanged sentences

Total accrued liabilities $ 37,690 $ 33,918

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Other Current Liabilities

13 unchanged sentences

If the liability is settled for an amount other than the recorded amount, a gain or loss is recognized.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Components of the changes in ARO consisted of the following and is shown below:

3 unchanged sentences

Liabilities assumed in acquisitions

Liabilities removed upon sale

Revision of estimated obligations 7,724 1,856

14 unchanged sentences

The Company recognizes revenue at the net price received when control transfers to the purchaser.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Natural Gas and NGL Sales

5 unchanged sentences

Transaction Price Allocated to Remaining Performance Obligations

Based on the Company’s current product sales contracts, with contract terms ranging from one to ten years , each unit of production is considered a separate performance obligation and therefore future production volumes are wholly unsatisfied and do not require allocation or disclosure of the transaction price to remaining performance obligations.

Based on the Company’s current product sales contracts, with contract terms ranging from one to fifteen years , each unit of production is considered a separate performance obligation and therefore future production volumes are wholly unsatisfied and do not require allocation or disclosure of the transaction price to remaining performance obligations.

Contract Balances

1 unchanged sentence

Accordingly, the Company’s product sales contracts do not give rise to contract assets or liabilities under ASC 606.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Prior-Period Performance Obligations

4 unchanged sentences

Disaggregation of Revenue

The Company's oil, natural gas and NGL sales are presented net of gathering, processing and transportation costs ("GP&T costs").

These costs, related to natural gas and NGLs, at times exceeded the price we received and resulted in negative average realized prices.

The following table presents oil and natural gas sales disaggregated by product:

Year Ended December 31,

2025 2024 2023

(In thousands)

Oil and natural gas sales:

Oil $ 408,935 $ 363,125

Natural gas ( 1,412 ) 2,612

Total oil and natural gas sales, net (1)

Oil sales, net

$ 398,341 $ 408,935 $ 363,125

Natural gas sales, net

( 3,322 ) ( 1,412 ) 2,612

(1) The Company's oil, natural gas and NGL sales are presented net of gathering, processing and transportation costs.

These costs, related to natural gas and NGLs, at times exceeded the price we received and resulted in negative average realized prices.

NGL sales, net

( 3,039 ) 2,278 6,910

Total oil and natural gas sales, net

$ 391,980 $ 409,801 $ 372,647

Contract Services with Related Parties

The Company had contracts with related parties to provide certain contract operating, accounting and back-office support services.

The Company had contracts with related parties to provide certain contract operating, accounting and back-office support services prior to 2025.

Revenue related to these contract services was recognized over time as the services were rendered, and the fee was stated within the contract at a fixed monthly rate.

1 unchanged sentence

Refer to Note 9 - Transactions with Related Parties for a more detailed discussion regarding these contracts.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Revenue Payable

2 unchanged sentences

Lease Operating Expenses

Lease operating costs, including payroll for field personnel, saltwater disposal, electricity, generator rentals, diesel fuel, workovers and other operating expenses are expensed as incurred and included in lease operating expenses in our consolidated statements of operations.

Lease operating costs, including labor costs for field personnel, electricity, equipment rental, contract services, workovers and other operating expenses are expensed as incurred and included in lease operating expenses in our consolidated statements of operations.

The Company uses the asset and liability method of accounting for income taxes, which requires the establishment of deferred tax accounts for all temporary differences between:

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As a result, management considers whether it is more likely than not that all or a portion of such assets will be realized during periods when they are available, and if not, management provides a valuation allowance for amounts not likely to be recognized.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Management periodically evaluates tax reporting methods to determine if any uncertain tax positions exist that would require the establishment of a loss contingency.

8 unchanged sentences

We incur interest expense that is affected by both fluctuations in interest rates, our debt balances and our financing decisions.

Interest expense in our consolidated statements of operations reflects interest, unused commitment fees paid to our lender, interest rate swap settlements, interest income and the amortization of deferred financing costs (including origination and amendment fees) less amounts allocated to capital expenditures, which are capitalized.

Interest expense, net was $ 34.3 million and $ 31.8 million for the years ended December 31, 2024, and 2023, respectively.

Interest expense, net in our consolidated statements of operations reflects interest, unused commitment fees paid to our lender, interest rate swap settlements, interest income and the amortization of deferred financing costs (including origination and amendment fees) less amounts allocated to capital expenditures, which are capitalized.

Interest expense, net was $ 31.4 million, $ 34.3 million and $ 31.8 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Capitalized interest represents interest expense related to capital projects during the period in which the Company is incurring costs and expending resources to get the properties ready for their intended purpose.

Capitalized interest is added to the cost of the underlying asset and is amortized over the useful life of the asset in the same manner as the underlying asset.

Capitalized interest was $ 2.0 million, $ 2.4 million and $ 3.2 million, for the years ended December 31, 2025, 2024 and 2023, respectively.

Concentrations of Credit Risk

2 unchanged sentences

Our purchaser contracts include marketing provisions with our purchasers to market our production.

For the year ended December 31, 2025, one purchaser accounted for 60 % of our revenue purchased.

For the years ended December 31, 2024, and 2023, one purchaser accounted for 70 % of our revenue purchased.

For the year ended December 31, 2024, and 2023, an additional purchaser accounted for 10% or more of our revenues.

For the years ended

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

December 31, 2025, 2024 and 2023, an additional purchaser accounted for 30 %, 22 % and 20 %, respectively.

Due to the recent acquisition of Stakeholder Midstream, LLC ("Stakeholder") by Targa Northern Delaware LLC ("Targa") and upon commencement of the new gas purchase agreement ("A&R Gas Purchase Agreement"), substantially all of our natural gas and NGLs will be sold to a single purchaser.

The loss of either of these purchasers could materially and adversely affect our revenues in the short-term.

However, based on the current demand for oil and natural gas and the availability of other purchasers, we believe that the loss of any of our purchasers would not have a long-term material adverse effect on our financial condition and results of operations because oil and natural gas are fungible products with well-established markets.

Further, the Company has the right to market our oil and natural gas production under these agreements.

Our primary exposure to credit risk is through receivables from the sale of our oil, natural gas, and NGLs (approximately $ 31.0 million at December 31, 2025) and the collection of receivables from joint interest owners for their proportionate share of expenditures made on properties in which we serve as the operator (approximately $ 6.3 million at December 31, 2025).

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Environmental expenditures that relate to current operations are expensed or capitalized as appropriate.

Expenditures that relate to an existing condition caused by past operations, which do not contribute to current or future revenue

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

generation, are expensed.

Expenditures that relate to an existing condition caused by past operations, which do not contribute to current or future revenue generation, are expensed.

Liabilities are recorded when environmental assessments and/or clean-ups are probable, and the costs can be reasonably estimated.

15 unchanged sentences

The carrying value reported for the Credit Facility approximates fair value because the underlying instruments are at interest rates which approximate current market rates and is considered Level 2 in the fair value hierarchy.

The liability

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

associated with the earnout payments related to the Silverback Acquisition is accounted for at fair value on a recurring basis and is considered Level 3 in the fair value hierarchy.

Assets and liabilities accounted for at fair value on a non-recurring basis in accordance with the fair value hierarchy include the initial recognition of ARO and the fair value of oil and natural gas properties when acquired in a business combination or assessed for impairment and are considered Level 3 in the fair value hierarchy.

15 unchanged sentences

The Company reviews all contracts to determine if a lease exists at contract inception.

A lease exists when the Company has the right to obtain

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

substantially all of the economic benefit of a specific asset and to control the use of that asset over the term of the agreement.

A lease exists when the Company has the right to obtain substantially all of the economic benefit of a specific asset and to control the use of that asset over the term of the agreement.

Identified leases are classified as an operating or finance lease, which determines the recognition, measurement and presentation of expenses.

8 unchanged sentences

In such cases, the Company is required to use our incremental borrowing rate ("IBR").

The Company’s IBR reflects the estimated rate of interest that the Company would pay to borrow on a collateralized basis over a similar term and amount equal to the lease payments in a similar economic environment.

The Company’s IBR reflects the estimated rate of interest that the Company would pay to borrow on a collateralized

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

basis over a similar term and amount equal to the lease payments in a similar economic environment.

The Company is required to reassess the discount rate for any new and modified lease contracts as of the lease effective date.

The weighted-average discount rate was 7.79 % and 9.56 %, respectively, at December 31, 2024, and 2023.

The weighted average remaining lease term was 2.2 years and 2.3 years, respectively, at December 31, 2024, and 2023.

Lease expense was $ 1.2 million and $ 0.8 million, respectively, for the years ended December 31, 2024, and 2023.

The following table presents additional lease information:

(In thousands)

2 unchanged sentences

Long-term lease liability $ 2,138 $ 673

7.27 % 7.79 %

Weighted average discount rate on all outstanding leases

7.76 % 7.47 %

Weighted average remaining lease term (years)

Lease expense was $ 1.4 million, $ 1.2 million and $ 0.8 million, respectively, for the years ended December 31, 2025, 2024 and 2023.

The ROU asset, current lease liability and non-current lease liability are included in other non-current assets, net, other current liabilities and other non-current liabilities , respectively, in our consolidated balance sheets.

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This ASU is effective retrospectively for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024.

The Company adopted this update effective January 1, 2024, see Note 14 - Segments.

The Company adopted this update effective January 1, 2024.

See Note 14 - Segments.

The adoption and implementation of this standard did not have a material impact on the Company's disclosures.

In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740) Improvements to Income Tax Disclosures which requires disaggregated information about the Company's effective tax rate reconciliation and income taxes paid.

This ASU is effective for the Company's fiscal year 2025.

Early adoption is permitted.

The Company does not expect this standard to have a material impact on our disclosures.

This ASU is effective for fiscal years beginning after December 15, 2024, and may be applied prospectively or retrospectively.

The Company adopted this update retrospectively effective January 1, 2025.

See Note 12 - Income Taxes.

The adoption and implementation of this standard did not have a material impact on the Company's disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40) Reporting Comprehensive Income-Expense Disaggregation Disclosures, which broadens the disclosures required for certain costs and expenses in the Company’s annual and interim consolidated financial statements.

3 unchanged sentences

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(4) Acquisitions of Oil and Natural Gas Properties

2023 New Mexico Acquisition

On April 3, 2023, the Company completed an acquisition of oil and natural gas properties (the "2023 New Mexico Acquisition") from Pecos Oil & Gas, LLC, a Delaware limited liability company and an affiliate of Cibolo Energy Partners LLC, for $ 324.7 million, funded through a combination of proceeds from the issuance of $ 200 million of Senior Notes and borrowings under the Company's Credit Facility.

The assets acquired are located in Eddy County, New Mexico, and included approximately 10,600 total contiguous net acres of leasehold.

The acquisition also included 18 net horizontal wells and 250 net vertical wells.

The 2023 New Mexico Acquisition qualified as a business combination using the acquisition method of accounting.

(4) Acquisitions and Divestitures

Midstream Sale

On December 3, 2025, the Company sold all of our membership interests in Dovetail Midstream, LLC, a wholly owned subsidiary of the Company that holds certain midstream infrastructure projects in Eddy County, New Mexico, to Targa for an aggregate cash purchase price of approximately $ 111 million, subject to customary purchase price adjustments (the "Midstream Sale").

The Midstream Sale also provided for the subsequent sale by the Company of certain compressor station assets for an aggregate cash purchase price of approximately $ 10 million plus reimbursement of $ 1.4 million of capital improvements;

this second transaction closed on December 24, 2025.

In connection with the Midstream Sale, the Company recognized a pre-tax gain of $ 71.7 million, net of $ 2.6 million of transaction costs, which was recorded in our consolidated statement of operations.

The Company also has the right to earn up to an additional $ 60 million in cash payments contingent upon achieving certain volumetric performance thresholds over a five-year period, beginning after the project in-service date in the A&R Gas Purchase Agreement, which is expected to be in-service before the end of 2026.

No amounts were recognized during the year ended December 31, 2025.

Silverback Acquisition

On July 1, 2025, the Company completed the acquisition of 100 % of the ownership interests of Silverback which owns oil and natural gas assets and operations located primarily in the Yeso trend of the Permian Basin in Eddy County, New Mexico for approximately $ 123 million, which included approximately $ 120 million paid in cash and approximately $ 3 million of estimated fair value related to potential earnout payments.

The purchase price is subject to change pending final purchase price adjustments including the release of $ 1.2 million remaining in escrow.

The Silverback Acquisition qualified as a business combination using the acquisition method of accounting.

The assets acquired and liabilities assumed were recognized at fair value as of the acquisition date.

The preliminary purchase price allocation is subject to change for up to one year subsequent to the closing date of the acquisition due to final customary purchase price adjustments.

The assets acquired and liabilities assumed were recognized on the consolidated balance sheet at fair value as of the acquisition date.

The fair value measurements of the oil and natural gas properties acquired and ARO assumed were derived utilizing an income approach and based, in part, on significant inputs not observable in the market.

These inputs represent Level 3 measurements in the fair value hierarchy and include, but are not limited to, estimates of future production volumes, future development, future operating costs, future cash flows and the use of weighted average cost of capital.

These inputs represent Level 3 measurements in the fair value hierarchy and include, but are not limited to, estimates of reserves, future development, future operating costs, future cash flows and the use of weighted average cost of capital.

These inputs required the use of significant judgments and estimates at the date of valuation, and use of different estimates and judgments could yield different results.

The following presents the allocation of the total purchase price of the 2023 New Mexico Acquisition to the identified assets acquired and liabilities assumed based on estimated fair value as of the Closing Date:

Purchase price allocation as of December 31, 2023 (in thousands):

Total cash consideration $ 324,686

Assets acquired:

Inventory $ 2,980

Oil and natural gas properties 342,308

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The following presents the allocation of the total purchase price of the Silverback Acquisition to the identified assets acquired and liabilities assumed based on estimated fair value as of the closing date of the acquisition:

Preliminary purchase price allocation as of December 31, 2025 (in thousands):

Consideration:

Cash consideration paid to sellers upon closing

Preliminary estimated fair value of earnout payments

Total consideration transferred

Fair value of assets acquired:

Accounts receivable

Prepaid expenses

Current derivative asset

Oil and gas properties

Other property and equipment

Other non-current assets

Amount attributable to assets acquired $ 158,503

Fair value of liabilities assumed:

Accounts payable

Accrued liabilities

Revenue payable 14,371

2 unchanged sentences

Net assets acquired $ 122,659

Transaction costs associated with the 2023 New Mexico Acquisition were approximately $ 5.8 million for the year ended December 31, 2023.

Cash consideration included deposits into escrow of $ 14.2 million at signing and $ 6.9 million at closing for title defects.

As of December 31, 2025, $ 4.6 million of the closing escrow was returned to the Company, $ 1.1 million was paid to the sellers and $ 1.2 million remains in escrow and is reflected as funds held in escrow in our consolidated balance sheets.

The Company may potentially pay the sellers quarterly earnout payments of up to $ 1.9 million per fiscal quarter during calendar years 2026 and 2027 if the New York Mercantile Exchange ("NYMEX") West Texas Intermediate ("WTI") quarterly average exceeds certain stated amounts set forth in the Purchase Agreement, ranging from $ 70 to $ 75 per barrel or higher.

See additional information on the fair value measurement of the earnout payments in Note 7 - Fair Value Measurements.

The Company funded the acquisition with cash on hand and borrowings under our Credit Facility.

Transaction costs associated with the Silverback Acquisition were approximately $ 4.6 million for the year ended December 31, 2025.

Post-Acquisition Operating Results

The results of operations attributable to the Silverback Acquisition since the closing date of the acquisition have been included in the consolidated statements of operations and include $ 27.0 million of total revenues, net and $ 15.0 million of earnings, which represents total revenues, net less production taxes and LOE , for the year ended December 31, 2025.

Pro Forma Operating Results (Unaudited)

The following unaudited pro forma combined results for the years ended December 31, 2023, and 2022, reflect the consolidated results of operations of the Company as if the 2023 New Mexico Acquisition had occurred on January 1, 2022.

The unaudited pro forma information includes adjustments for (i) transaction costs being reclassified to 2022 instead of being recorded during the year ended December 31, 2023, (ii) amortization for the discount and deferred financing costs related to the Senior Notes and Credit Facility, (iii) depletion, depreciation and amortization expense, and (iv) interest expense related to the financing for the 2023 New Mexico Acquisition.

These adjustments reflect such costs, as described above, that would have been recognized had the Company acquired the assets on January 1, 2022.

In addition, the pro forma information has been effected for taxes with a 23 % tax rate for the years ended December 31, 2023, and 2022.

The results of operations of the Silverback Acquisition have been included in the Company's consolidated financial statements since the closing date of the acquisition.

The following supplemental, unaudited pro forma combined financial information for the years ended December 31, 2025, and 2024 reflect the consolidated results of operations of the Company as

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

if the Silverback Acquisition had occurred on January 1, 2024.

The information below reflects pro forma adjustments based on available information and certain assumptions that the Company believes are factual and supportable.

The unaudited pro forma information includes adjustments for (i) transaction costs being reclassified to the first quarter of 2024 instead of being recorded in the year ended December 31, 2025, (ii) depletion, depreciation and amortization expense and (iii) interest expense related to the financing for the Silverback Acquisition.

In addition, the pro forma information has been effected for income taxes with a blended statutory rate of 25.7 % for the year ended December 31, 2025, and 2024.

Year Ended December 31,

7 unchanged sentences

$ 8.06 $ 4.16

The unaudited pro forma combined financial information is for informational purposes only and is not intended to represent or to be indicative of the combined results of operations that the Company would have reported had the 2023 New Mexico Acquisition been completed as of January 1, 2022, and should not be taken as indicative of the Company's future combined results of operations.

The unaudited pro forma combined financial information is for informational purposes only and is not intended to represent or to be indicative of the combined results of operations that the Company would have reported had the Silverback Acquisition been completed as of January 1, 2024, and should not be taken as indicative of the Company's future combined results of operations.

The actual results may differ significantly from that reflected in the unaudited pro forma combined financial information for a number of reasons, including, but not limited to, differences in assumptions used to prepare the unaudited pro forma combined financial information and actual results.

On November 21, 2025, the Company sold its interest in oil and natural gas properties in Texas outside of the Company's acreage in the Champions field ("Viking Sale"), which had a net carrying value of $ 10.4 million to an affiliate of Combo Resources, LLC ("Combo").

The properties consisted of six established units in Lee and Fayette Counties, Texas, which were jointly developed by the Company and Combo.

In exchange for the Company's interest in these assets, we received and subsequently retired 250,000 shares of the Company's common stock.

The net carrying value of the assets plus cash paid of $ 0.8 million less the tax impact of the sale resulted in a reduction to additional paid-in capital of $ 10.2 million.

2024 New Mexico Asset Acquisition

On May 7, 2024, the Company completed the acquisition of oil and natural gas properties in Eddy County, New Mexico ("2024 New Mexico Asset Acquisition"), which added 13,900 contiguous net acres to the Company's existing acreage in Eddy County, for a cash purchase price of approximately $ 19.1 million plus $ 0.5 million in transaction costs.

On May 7, 2024, the Company completed the acquisition of oil and natural gas properties in Eddy County, New Mexico, for a cash purchase price of approximately $ 19.1 million plus $ 0.5 million in transaction costs.

The 2024 New Mexico Asset Acquisition was accounted for as an asset acquisition, with the final purchase price and transaction costs being capitalized to oil and natural gas properties.

This acquisition was funded through a combination of proceeds from the 2024 equity issuance ("2024 Equity Offering") discussed in Note 11 - Shareholders' Equity and cash on hand.

2023 New Mexico Acquisition

On April 3, 2023, the Company completed the acquisition of oil and natural gas properties in Eddy County, New Mexico, from Pecos Oil & Gas, LLC for $ 324.7 million, funded through a combination of proceeds from the issuance of $ 200 million of Senior Notes and borrowings under the Company's Credit Facility.

The 2023 New Mexico Acquisition was accounted for as a business combination.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(5) Oil and Natural Gas Properties

8 unchanged sentences

As of December 31, 2025, and 2024, the Company had no exploratory wells included in work-in-progress.

Depletion and amortization expense for proved oil and natural gas properties was $ 71.3 million and $ 62.5 million for the years ended December 31, 2024, and 2023, respectively.

Exploration costs were $ 2.6 million and $ 4.2 million for the years ended December 31, 2024, and 2023, respectively, and were primarily attributable to expiration of oil and natural gas leases in 2024 and exploratory well expense and the expiration of oil and natural gas leases in 2023.

Depletion expense for proved oil and natural gas properties was $ 84.4 million, $ 71.3 million and $ 62.5 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Exploration costs were $ 0.4 million, $ 2.6 million and $ 4.2 million for the years ended December 31, 2025, 2024 and 2023, respectively, and were primarily attributable to expiration of oil and natural gas leases in 2025 and 2024 and exploratory well expense and the expiration of oil and natural gas leases in 2023.

Impairment of Proved Properties

2 unchanged sentences

We calculated the expected undiscounted future net cash flows of our long-lived assets using management’s assumptions and expectations.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Certain oil and natural gas properties in Texas and New Mexico outside of the Company's acreage in the Champions and Red Lake fields failed the initial step assessment, which looks at the carrying value compared to undiscounted cash flows for these properties.

Certain oil and natural gas properties in New Mexico outside of the Company's acreage in the Red Lake field failed the initial step assessment, which looks at the carrying value compared to undiscounted cash flows for these properties.

For these assets, we used a discounted cash flow analysis to estimate fair value.

The expected future net cash flows were discounted using a rate of 10.0 %, which we believe represents the estimated weighted average cost of capital of a market participant.

Based on this assessment of our long-lived assets impairment test, the carrying value exceeded the estimated fair market value, and we recognized an $ 11.3 million non-cash impairment of proved properties comprised of a $ 9.5 million impairment in Texas, outside of the Champions field, and $ 1.8 million impairment in New Mexico, outside of the Red Lake field related to historical properties, for the year ended December 31, 2024.

The impairments were primarily driven by a reduction in reserve volume due to lower well performance assessments based on historical trends.

The affected areas included nine operated producing wells.

The Company recognized an impairment of $ 9.8 million on proved properties in Texas, outside of the Champions field, for the year ended December 31, 2023.

Based on this assessment of our long-lived assets impairment test, the carrying value exceeded the estimated fair market value, and we recognized a non-cash impairment.

For the year ended December 31, 2025, and 2024, the Company recognized a non-cash impairment of $ 1.2 million and $ 1.8 million, respectively, relating to certain properties in New Mexico outside of the Company's acreage in the Red Lake field.

Additionally, the Company recognized a non-cash impairment loss on proved properties of $ 9.5 million for the year ended December 31, 2024, relating to certain properties in Texas outside of the Company's acreage in the Champions field that were sold as part of the Viking Sale.

The 2025 and 2024 impairments were primarily driven by a reduction in well results and lower commodity prices.

In 2023, the Company recognized an impairment of $ 9.8 million on proved properties in Texas, outside of the Champions field that were sold as part of the Viking Sale.

These impairments are included in our consolidated statements of operations as impairments of oil and natural gas properties.

4 unchanged sentences

If the carrying amount exceeds the estimated undiscounted future cash flows, we adjust the carrying amount of the oil, natural gas and NGL properties to their estimated fair value which is considered a Level 3 measurement.

As part of the impairment review during the third quarter 2024, the Company made the decision to discontinue our EOR Project, which was in work-in-process, in favor of redeploying the required future capital and salvaging the assets for use in our conventional vertical and horizontal development programs.

As a result of this decision, the remaining fair value for the EOR Project was determined to be zero and the Company recorded a non-cash impairment loss of $ 28.9 million and a cash impairment loss of $ 1.3 million related to the termination of the Kinder Morgan CO 2 contract.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

salvaging the assets for use in our conventional vertical and horizontal development programs.

As a result of this decision, the remaining fair value for the EOR Project was determined to be zero , after $ 1.8 million in compressors and other equipment were transferred to inventory for future use in our consolidated balance sheets.

The Company also recorded a non-cash impairment loss of $ 28.9 million and a cash impairment loss of $ 1.3 million related to a contract termination payment.

The total $ 30.2 million impairment is included in other impairments in our consolidated statements of operations.

In 2025, the Company determined the fair value of the compressors to be zero, and therefore wrote off the cost of the compressors and recorded a non-cash impairment loss of $ 1.6 million and is included in other impairments in our consolidated statement of operations.

(6) Derivative Instruments

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If the market price is between the put and the call strike price, no payments are due from either party.

• Basis Protection Swaps – basis swaps are settled based on differences between a fixed price differential and the differential between the settlement prices of two referenced indexes.

We receive the fixed price differential and pay the differential between the referenced indexes.

RILEY EXPLORATION PERMIAN, INC.

1 unchanged sentence

The following table summarizes the open financial derivative positions as of December 31, 2025, related to oil and natural gas production:

First Quarter Second Quarter Third Quarter Fourth Quarter First Quarter Second Quarter Third Quarter Fourth Quarter

WTI Oil Swaps

636,000 600,000 600,000 600,000 305,000 170,000 90,000

Weighted average price

Calendar Quarter / Year Notional Volume Fixed Put Call

Oil Swaps (Bbl)

Q1 2025 375,000 $ 74.31

Q2 2025 345,000 $ 71.32

Q3 2025 165,000 $ 68.53

Q4 2025 120,000 $ 66.99

Natural Gas Swaps (Mcf)

Q1 2025 965,000 $ 3.61

Q2 2025 495,000 $ 3.34

Q3 2025 480,000 $ 3.30

Q4 2025 1,165,000 $ 3.82

$ 61.96 $ 61.69 $ 60.98 $ 60.69 $ 61.07 $ 60.81 $ 58.90

WTI Oil Collars

516,000 486,000 480,000 440,000 355,000 477,000 340,000

Oil Collars (Bbl)

Q1 2025 468,000 $ 60.48 $ 77.04

Q2 2025 300,000 $ 66.50 $ 78.77

Q3 2025 452,000 $ 64.23 $ 74.19

Q4 2025 480,000 $ 63.10 $ 77.07

Weighted average floor price ($/Bbl) $ 59.55 $ 57.78 $ 56.99 $ 56.39 $ 57.03 $ 55.31 $ 51.68

Weighted average ceiling price ($/Bbl) $ 77.16 $ 73.54 $ 72.31 $ 68.61 $ 66.19 $ 68.35 $ 66.02

Henry Hub Natural Gas Swaps

Volume (MMBtu) 1,005,000 450,000 300,000 500,000 600,000

Weighted average price

$ 3.97 $ 3.64 $ 3.59 $ 4.07 $ 4.19

Natural Gas Collars (Mcf)

Q1 2025 555,000 $ 3.46 $ 4.38

Q2 2025 1,080,000 $ 3.04 $ 3.65

Q3 2025 1,110,000 $ 3.12 $ 3.76

Q4 2025 400,000 $ 3.30 $ 4.00

Henry Hub Natural Gas Collars

Volume (MMBtu) 225,000 900,000 900,000 600,000 450,000

Weighted average floor price ($/MMBtu) $ 3.67 $ 3.05 $ 3.05 $ 3.43 $ 3.80

Weighted average ceiling price ($/MMBtu)

$ 4.30 $ 3.74 $ 3.74 $ 4.79 $ 5.84

Interest Rate Contracts

The Company entered into floating-to-fixed interest rate swaps, in which it will receive a floating market rate equal to one-month Chicago Mercantile Exchange Term Secured Overnight Financing Rate ("SOFR") Rate and will pay a fixed interest rate to manage future interest rate exposure related to the Company’s Credit Facility.

In March 2024, the Company entered into a fixed-to-floating interest rate swap for the period from May 2024 to December 2024, to reduce our interest rate exposure, which resulted in a gain of approximately $ 1 million for the year ended December 31, 2024, on a notional amount of $ 80 million, and is included in our consolidated statements of operations.

Waha Basis Swaps

Volume (MMBtu) 450,000 450,000 450,000 600,000 1,350,000 675,000 675,000 675,000

Weighted average price

$ ( 2.01 ) $ ( 2.26 ) $ ( 2.26 ) $ ( 1.31 ) $ ( 0.87 ) $ ( 0.75 ) $ ( 0.75 ) $ ( 0.75 )

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Interest Rate Contracts

This gain was realized upon settlement of the contracts throughout 2024.

The following table summarizes the open interest rate derivative positions as of December 31, 2025:

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(In thousands)

January 2025 - April 2026

January 2026 - April 2026 Long

$ 30,000 3.18 %

January 2025 - April 2026

January 2026 - April 2026 Long

$ 50,000 3.04 %

April 2026 - April 2027

April 2026 - April 2027 Long

$ 45,000 3.90 %

Balance Sheet Presentation of Derivatives

The following tables present the location and fair value of the Company’s derivative contracts included in our consolidated balance sheets as of December 31, 2024, and 2023:

The following tables present the location and fair value of the Company’s derivative contracts included in our consolidated balance sheets:

December 31, 2025

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Year Ended December 31,

2025 2024 2023

(In thousands)

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Gain (loss) on derivatives, net $ 36,259 $ ( 1,665 ) $ 6,193

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(7) Fair Value Measurements

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The carrying value reported for the Credit Facility approximates fair value because the underlying instruments are at interest rates which approximate current market rates.

The fair value of the Senior Notes is based on estimates of current rates

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

available for similar issuances with similar maturities and is classified as Level 2 in the fair value hierarchy.

The oil and natural gas properties acquired and ARO assumed in both the 2023 New Mexico Acquisition and the 2024 New Mexico Asset Acquisition are considered Level 3 measurements.

The fair value of the Senior Notes is based on estimates of current rates available for similar issuances with similar maturities and is classified as Level 2 in the fair value hierarchy.

The oil and natural gas properties acquired and ARO assumed in the Silverback Acquisition, 2024 New Mexico Asset Acquisition and 2023 New Mexico Acquisition in addition to the fair value of assets and liabilities when considered for impairment are considered Level 3 measurements.

Assets and Liabilities Measured on a Recurring Basis

The fair value of commodity derivatives and interest rate swaps is estimated using discounted cash flow calculations based upon forward curves and are classified as Level 2 in the fair value hierarchy.

The following table presents the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of December 31, 2024, and 2023, by level within the fair value hierarchy:

The fair values of commodity derivatives and interest rate swaps are estimated using discounted cash flow calculations based on forward curves and are classified as Level 2 within the fair value hierarchy.

The following table summarizes these instruments that were accounted for at fair value on a recurring basis by level within the fair value hierarchy:

December 31, 2025

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Commodity derivative liabilities $ — $ ( 7,179 ) $ — $ ( 7,179 )

Interest rate liabilities $ — $ ( 149 ) $ — $ ( 149 )

December 31, 2024

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Commodity derivative liabilities $ — $ ( 13,043 ) $ — $ ( 13,043 )

Earnout Payments - Silverback

The earnout payments in connection with the Silverback Acquisition were valued using a Monte Carlo simulation model that incorporated forward strip pricing as of December 31, 2025.

The valuation process involved modeling the potential earnout payments over numerous scenarios based on WTI futures prices.

The average expected value from the simulations was then discounted using the Company's cost of debt.

Based on the forward strip pricing as of December 31, 2025, management determined that no material change in estimates was necessary.

The fair value of the earnout payments is considered a Level 3 measurement due to the unobservable inputs including volatility and the discount rate, as well as the detailed modeling required to estimate fair value.

See Note 4 - Acquisitions and Divestitures for additional information on the earnout payments.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

December 31, 2025

(In thousands)

Earnout Payments (Level 3)

As of December 31, 2025, $ 1.0 million is accrued in other current liabilities and $ 2.1 million is accrued in other long-term liabilities in our consolidated balance sheets.

Liabilities Not Measured on a Recurring Basis

The following table summarizes the fair value and carrying amount of the Company's financial instruments.

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and (iv) a market-based weighted average cost of capital rate.

The underlying commodity prices embedded in the Company's estimated cash flows are the product of a process that begins with

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

New York Mercantile Exchange ("NYMEX") forward curve pricing, adjusted for estimated location and quality differentials, as well as other factors that the Company’s management believes will impact realizable prices.

The underlying commodity prices embedded in the Company's estimated cash flows are the product of a process that begins with NYMEX forward curve pricing, adjusted for estimated location and quality differentials, as well as other factors that the Company’s management believes will impact realizable prices.

These inputs require significant judgments and estimates by the Company’s management at the time of the valuation.

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The factors used to determine fair value are subject to management’s judgment and expertise and include, but are not limited to, recent sales prices of comparable properties, the present value of future cash flows, net of estimated operating and development costs using estimates of proved reserves, future commodity pricing, future production estimates, anticipated capital expenditures, and various discount rates commensurate with the risk and current market conditions associated with the expected cash flow projected.

For the year ended December 31, 2024, the Company recognized non-cash impairment losses to our oil and natural gas properties of $ 11.3 million related to acreage in Texas and New Mexico outside of our Champions and Red Lake fields as well as a non-cash impairment loss of $ 28.9 million related to the discontinuation of the EOR project.

For the year ended December 31, 2025, the Company recognized a non-cash impairment loss to our oil and natural gas properties of $ 1.2 million related to acreage in New Mexico outside of our Red Lake field as well as a non-cash impairment

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

loss of $ 1.6 million for the previously repurposed compressors related to the EOR project.

At the time of impairment, the oil and natural gas properties in New Mexico outside of our Red Lake field had a net book value of $ 1.2 million and a fair value of zero resulting in an impairment loss of $ 1.2 million.

The compressors related to the EOR project had a net book value of $ 1.6 million and a fair value of zero resulting in an impairment loss of $ 1.6 million.

For the year ended December 31 2024, the Company recognized non-cash impairment losses of $ 11.3 million related to acreage in Texas and New Mexico outside of our Champions and Red Lake fields as well as a non-cash impairment loss of $ 28.9 million related to the discontinuation of the EOR project.

As of December 31, 2024, the oil and natural gas properties in Texas outside of the Champions field had a net book value of $ 21.1 million and a fair value of $ 11.6 million resulting in an impairment loss of $ 9.5 million and the oil and natural gas properties in New Mexico outside of the Red Lake field had a net book value of $ 3.1 million and a fair value of $ 1.3 million resulting in an impairment loss of $ 1.8 million.

The EOR project had a net book value of $ 41.7 million and a fair value of $ 12.8 million for salvageable assets with alternative uses, resulting in an impairment loss of $ 28.9 million.

The EOR project had a net book value of $ 41.7 million and a fair value of $ 12.8 million for repurposed assets (including the EOR compressors) with alternative uses, resulting in an impairment loss of $ 28.9 million.

For the year ended December 31, 2023, the Company recognized non-cash impairment losses to our oil and natural gas properties of $ 9.8 million related to acreage in Texas outside of our Champions field.

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Under the discounted cash flow methodology, the expected future net cash flows were discounted using a weighted average cost of capital rate reflective of a market participant rate.

Additionally, the assumptions utilized include the future commodity prices for oil and natural gas based on NYMEX strip pricing for West Texas Intermediate ("WTI") and Henry Hub ("HH"), as adjusted for differentials (using the Company's historical average of differentials, which approximate a market participant's differentials) and operating cost assumptions based on the Company's historical LOE, which are deemed to estimate a market participant's operating costs.

See further discussion of our impairment in Note 5 - Oil and Natural Gas Properties.

Additionally, the assumptions utilized include the future commodity prices for oil and natural gas based on NYMEX strip pricing for WTI and Henry Hub, as adjusted for differentials (using the Company's historical average of differentials, which approximate a market participant's differentials) and operating cost assumptions based on the Company's historical LOE, which are deemed to estimate a market participant's operating costs.

See further discussion of our impairments in Note 5 - Oil and Natural Gas Properties.

(8) Equity Method Investment

In January 2023, the Company formed a joint venture, RPC Power LLC, a Delaware limited liability company ("RPC Power"), with Conduit Power LLC for the purpose of constructing, owning and operating power generation assets.

RPC Power's initial scope and assets use the Company’s produced natural gas to power a portion of our operations in Yoakum County, Texas which became fully operational in September 2024.

In May 2024, the Company entered into the Second Amended and Restated Limited Liability Company Agreement (“A&R LLC Agreement”) to expand the scope of our joint venture to include the constructing, owning, and operating of additional new power generation and storage assets, for the sale of energy and ancillary services to the Electric Reliability Council of Texas ("Merchant Deal").

Upon signing the A&R LLC Agreement, the Company invested an additional $ 9.5 million and also increased our equity ownership in RPC Power from 35 % to 50 %.

RPC Power LLC ("RPC Power") is our power-focused joint venture with Conduit Power LLC, in which we have 50 % ownership.

The Company is involved in two current projects with RPC Power.

The first project provides a portion of our electric power needs for our field operation in our Champions field.

This project consists of two sites located within the Company's operating area.

The power generated and delivered by RPC Power is consumed by operating activities and not sold to the electric grid.

The second project is intended to provide power for the sale into the Electric Reliability Council of Texas ("ERCOT"), the primary electric grid of Texas, with none of the generation consumed by Riley Permian.

This project consists of four sites located outside of the Company's operating area, but in the west Texas region.

As the Company has significant influence due to our ownership percentage, but lacks control, RPC Power is accounted for as an equity method investment.

In November 2024, the Company signed the Second Amendment to the A&R LLC Agreement, which increased the capital commitment for each owner from $ 42.5 million to $ 51.5 million.

As of December 31, 2024, the Company had invested $ 23.8 million in the joint venture, comprised of $ 21.5 million in cash and $ 2.3 million of contributed assets, which was reduced by the Company's share of losses and increased by our share of income in the joint

As of December 31, 2025, the

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The Company also had a remaining commitment to invest up to an additional $ 27.7 million to fund our portion of the remaining 2025 capital budget for the RPC Power joint venture.

On February 28, 2025, the Company contributed an additional $ 6.3 million to RPC Power, which increased our total capital contributions to $ 30 million.

Company had invested $ 39.5 million in the joint venture, comprised of $ 37.2 million in cash and $ 2.3 million of contributed assets, which was reduced by the Company's share of losses and increased by our share of income in the joint venture.

During the year ended December 31, 2025, the Company contributed an additional $ 15.8 million to RPC Power.

The Company has a remaining commitment to invest up to an additional $ 12.0 million, if required, to fund our portion of the future capital budget for the RPC Power joint venture.

On December 31, 2025, RPC Power declared a $ 3 million dividend, of which $ 1.5 million was the Company's portion.

The dividend was paid in January 2026.

We account for any distributions received from our equity method investment using the nature-of-distribution approach.

Under this approach, distributions are classified based on the underlying activity of the investee that generated them.

Returns on investment are presented within operating activities, while returns of investment are presented within investing activities in our consolidated statement of cash flows.

See Note 9 - Transactions with Related Parties for further discussion of the contractual agreements between the Company and RPC Power and its affiliates and Note 15 - Commitments and Contingencies for additional information on future commitments.

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Contributions 15,750 17,912

Distributions

Loss from equity method investment ( 886 ) ( 721 )

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(9) Transactions with Related Parties

In January 2023, the Company entered into a 10-year agreement with RPC Power, which provides for the conversion of specified quantities of the Company’s produced natural gas to electricity to power a portion of our oilfield operations in Yoakum County, Texas ("Tolling Agreement").

The Tolling Agreement was amended and restated in June 2024 ("A&R Tolling Agreement") primarily to reflect the new in-service date of September 2024.

The Company also entered into a 10-year agreement (“Asset Optimization Agreement”) in January 2023 that requires RPC Power to provide operational expertise on the implementation and management of the power generating assets subject to the A&R Tolling Agreement for a monthly fee of $ 20 thousand.

In May 2024, the Company entered into the Second Amended and Restated Limited Liability Company Agreement (“A&R LLC Agreement”) to expand the scope of our joint venture to include the constructing, owning and operating of additional new power generation and storage assets, for the sale of energy and ancillary services to ERCOT ("Merchant Deal").

In May 2024, the Company entered into a 10-year natural gas supply agreement ("Supply Agreement") with RPC Merchant LLC, a wholly owned subsidiary of RPC Power ("RPC Merchant"), to supply natural gas to fuel the natural gas generators under the Merchant Deal.

The Company's commitment under the Supply Agreement is contingent upon project start-up which is expected to occur beginning in late 2025 through 2026.

The Company incurred LOE from RPC Power of approximately $ 4.3 million and $ 0.2 million for the year ended December 31, 2024, and 2023, respectively.

As of December 31, 2024, and December 31, 2023, the Company had approximately $ 1.2 million and zero accrued for RPC Power, which was included in accrued liabilities in our consolidated balance sheets.

The Company's commitment under the Supply Agreement is contingent upon project start-up which is expected to commence in 2026.

The Company incurred LOE from RPC Power of approximately $ 7.7 million, $ 4.3 million and $ 0.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

As of December 31, 2025, and 2024, the Company had approximately $ 0.7 million and $ 1.2 million accrued for RPC Power, which was included in accrued liabilities in our consolidated balance sheets.

See additional information related to RPC Power in Note 8 - Equity Method Investment and Note 15 - Commitments and Contingencies for additional information on future commitments.

Contract Services

The Company and Combo Resources, LLC (“Combo”) own interests in six established units in Lee and Fayette Counties, Texas, which were jointly developed by the parties pursuant to participation agreements (collectively, the "Combo PA") and are currently operated by Riley Permian Operating Company, LLC ("RPOC").

RPOC also provided certain administrative and operational services to Combo pursuant to a management services agreement (the "Combo MSA") for a monthly fee of $ 100 thousand and reimbursement of all third party expenses until the Combo MSA was terminated on January 31, 2024.

Separately, the Combo PA was also terminated as of December 31, 2023, and pursuant to a letter agreement effective as of December 31, 2023, the Company agreed to relinquish our right to acquire additional working interests within a specified area.

The rights of the Company in the six jointly owned units are not affected by this letter agreement and remain subject to the existing joint operating agreements between the parties.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The Company also provided certain administrative services pursuant to a services agreement (the "REG MSA") with Riley Exploration Group, LLC (“REG”) for a monthly fee of $ 100 thousand through January 2024 and $ 60 thousand through April 2024, and reimbursement of all third party expenses until the REG MSA was terminated effective May 31, 2024.

The $ 60 thousand fee was waived for the month of May 2024.

Contract Services

Prior to January 31, 2024, the Company provided certain administrative and operational services to Combo pursuant to a management services agreement (the "Combo MSA") for a monthly fee of $ 100 thousand and reimbursement of all third party expenses.

The Company also provided certain administrative services pursuant to a services agreement (the "REG MSA") with Riley Exploration Group, LLC (“REG”) for a monthly fee and reimbursement of all third party expenses until the REG MSA was terminated effective May 31, 2024.

The following table presents revenues from and related cost for contract services for related parties:

Year Ended December 31,

2025 2024 2023

(In thousands)

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Cost of contract services $ — $ 363 $ 579

The Company had no amounts payable to Combo at December 31, 2024, and $ 0.7 million payable at December 31, 2023, which is reflected in other current liabilities in our consolidated balance sheets.

Amounts due to Combo reflect the revenue, net of any expenditures, for Combo's net working interest in wells that RPOC operates on Combo's behalf.

The Company had no amounts receivable from Combo at December 31, 2024, and December 31, 2023.

The Company also had no amounts receivable from REG at December 31, 2024, and December 31, 2023.

The Company had no revenues from or related costs for contract services for related parties during the year ended December 31, 2025.

The Company had no amounts payable or receivable with Combo or REG as of December 31, 2025, and 2024.

Consulting and Legal Fees

The Company has an engagement agreement with di Santo Law PLLC ("di Santo Law"), a law firm owned by Beth di Santo, a member of our Board of Directors, pursuant to which di Santo Law's attorneys provide legal services to the Company.

The Company incurred legal fees from di Santo Law of approximately $ 1.4 million, and $ 1.2 million, for the years ended December 31, 2024, and 2023, respectively.

The Company incurred legal fees from di Santo Law of approximately $ 2.2 million, $ 1.4 million and $ 1.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

As of December 31, 2025, and 2024, the Company had approximately $ 1.7 million and $ 0.3 million in amounts accrued for di Santo Law, which were included in other current liabilities in our consolidated balance sheets.

Other Related Party Transactions

See Note 4 - Acquisitions and Divestitures for a full discussion of the Viking Sale.

In certain instances, business requires our employees to charter privately owned aircraft in furtherance of our business, including accessing remote areas of our field operation.

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We pay fees incurred for flights directly to the charter company that manages the planes.

During the year ended December 31, 2024, we paid the charter company $ 0.1 million for flights chartered by our employees.

During each of the years ended December 31, 2025, and 2024, we paid the charter company $ 0.2 million and $ 0.1 million, respectively for flights chartered by our employees.

The Company did no t pay for the use of a chartered plane during the year ended December 31, 2023.

RILEY EXPLORATION PERMIAN, INC.

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On November 14, 2023, through the semi-annual redetermination process and fifteenth amendment, the Credit Facility was amended to increase the borrowing base from $ 325 million to $ 375 million, resulting in the addition of two new lenders and the exit of one lender.

On December 13, 2024, the Company entered into the sixteenth amendment to the Credit Facility to, among other things, extend the stated maturity date from April 2026 to December 2028 (or if any Senior Notes are then outstanding, the date that is 181 days prior to the earliest stated maturity date of such Senior Notes, in this case October 2027) and increase the borrowing base from $ 375 million to $ 400 million, resulting in the addition of one new lender to the lending group.

On December 13, 2024, the Company entered into the sixteenth amendment to the Credit Facility to, among other things, extend the stated maturity date from April 2026 to December 2028 (or if any Senior Notes are then outstanding, the date that is 181 days prior to the earliest stated maturity date of such Senior Notes, in this case October 2027) and increase the borrowing base from $ 375 million to $ 400 million, which was reaffirmed in December 2025 with the removal of the natural gas hedging requirement.

Substantially all of the Company’s assets are pledged to secure the Credit Facility.

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If the Company's leverage ratio, after giving pro forma effect to such Restricted Payments (as defined in the Credit Agreement), is above 2.0 to 1.0, then an additional test of free cash flow is applied, and the Company will only be permitted to make such Restricted Payments if such payment does not exceed the Company's free cash flow.

In addition to and after giving effect to such Restricted Payments, the availability of funds under the Company's Credit Facility must be greater than or equal to 20% of the elected commitments.

The Company is also required to limit our cash balance to less than $ 32.5 million or 10 % of the borrowing base, whichever is greater.

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The Credit Agreement also contains other customary affirmative and negative covenants and events of default.

The Company must maintain a minimum hedging requirement included in the Credit Agreement for oil and natural gas based on our proved developed producing projected volumes on a rolling 24-month basis.

The Company must maintain a minimum hedging requirement included in the Credit Agreement for oil based on our proved developed producing projected volumes on a rolling 24-month basis.

The following table summarizes the Credit Facility balances:

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As of December 31, 2025, the Company had $ 20 million in current liabilities in our consolidated balance sheets related to the quarterly principal payments due within the next 12 months.

The Issuer may, at its option, redeem, at any time and from time to time on or prior to April 3, 2026, some or all of the Senior Notes at 100 % of the principal amount thereof plus the make-whole amount plus a premium of 5.25 % as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any.

After April 3, 2026, but on or prior to October 3, 2026, the Issuer may, at its option, redeem, at any time and from time to time some or all of the Senior Notes at 100 % of the principal amount thereof plus a premium of 5.25 % as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any.

After October 3, 2026, the Issuer may redeem some or all of the Senior Notes at 100 % of the principal amount thereof plus accrued and unpaid interest, if any.

The principal remaining outstanding at the time of maturity is required to be paid in full by the Issuer.

The Company may, at our option, redeem, at any time and from time to time on or prior to April 3, 2026, some or all of the Senior Notes at 100 % of the principal amount thereof plus the make-whole amount plus a premium of 5.25 % as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any.

After April 3, 2026, but on or prior to October 3, 2026, the Company may, at our option, redeem, at any time and from time to time some or all of the Senior Notes at 100 % of the principal amount thereof plus a premium of 5.25 % as set forth in the Note Purchase Agreement plus accrued and unpaid interest, if any.

After October 3, 2026, the Company may redeem some or all of the Senior Notes at 100 % of the principal amount thereof plus accrued and unpaid interest, if any.

The principal remaining outstanding at the time of maturity is required to be paid in full by the Company.

Certain note features, including those discussed above, were evaluated and deemed to be remote.

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The Senior Notes also contain a total leverage ratio and an asset coverage ratio for Restricted Payments, as defined in the Senior Notes.

The leverage ratio, after giving pro forma effect to such Restricted Payments, cannot exceed 2.0 to 1.0, and the asset coverage ratio, after giving effect to such

The leverage ratio, after giving pro

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Restricted Payments, must be greater than or equal to 1.50 to 1.0.

forma effect to such Restricted Payments, cannot exceed 2.0 to 1.0, and the asset coverage ratio, after giving effect to such Restricted Payments, must be greater than or equal to 1.50 to 1.0.

In addition to and after giving effect to such Restricted Payments, the outstanding balance on the Company's Credit Facility must be greater than or equal to 15 % of the lesser of the then effective Borrowing Base and the Aggregate Elected Commitment Amount.

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Year Ended December 31,

2025 2024 2023

(In thousands)

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Amortization of deferred financing costs

2,316 2,730 2,278

Amortization of discount on Senior Notes

2,452 2,569 1,883

Unused commitment fees on Credit Facility

Total interest expense, net $ 31,364 $ 34,338 $ 31,816

As of December 31, 2024, and 2023, the weighted average interest rate on outstanding borrowings under the Credit Facility was 7.79 % and 8.68 %, respectively.

As of December 31, 2024, the Senior Notes had $ 7.5 million of unamortized discount and $ 3.0 million of unamortized deferred financing costs, resulting in an effective interest rate of 13.38 % during the year ended December 31, 2024.

During the year ended December 31, 2025, and 2024, the weighted average interest rate on the Credit Facility was 7.39 % and 7.79 %, respectively.

As of December 31, 2025, and 2024, the Senior Notes had $ 5.1 million and $ 7.5 million of unamortized discount and $ 2.1 million and $ 3.0 million of unamortized deferred financing costs, respectively, resulting in an effective interest rate of 13.4 % during the years ended December 31, 2025, and 2024.

As of December 31, 2025, and 2024, the Company was in compliance with all covenants contained in the Credit Agreement and the Note Purchase Agreement.

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March 31, 2024 $ 0.36 $ 7,329

Share-Based Compensation

December 31, 2023 $ 0.36 $ 7,477

September 30, 2023 $ 0.34 $ 6,737

June 30, 2023 $ 0.34 $ 6,846

March 31, 2023 $ 0.34 $ 6,851

Stock-Based Compensation

On April 21, 2023, at the Company's annual meeting of stockholders, the Company's stockholders approved the A&R LTIP that increased the total number of shares of common stock, par value $ 0.001 per share, by 950,000 shares that may be utilized for awards pursuant to the Plan from 1,387,022 to 2,337,022 .

The A&R LTIP had 346,645 shares available as of December 31, 2025.

2021 Long-Term Incentive Plan

The A&R LTIP will provide for potential grants of:

The A&R LTIP provides for potential grants of:

(i) incentive stock options qualified as such under U.S.

federal income tax laws ("ISO's");

(ii) stock options that do not qualify as incentive stock options;

(iii) stock appreciation rights, or SARs;

(iv) restricted stock awards;

federal income tax laws ("ISOs");

(ii) stock options that do not qualify as ISOs (iii) stock appreciation rights, or SARs;

(iv) restricted stock awards, or RSAs;

(v) restricted stock units, or RSUs, (vi) stock awards;

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(x) cash awards;

and (xi) substitute awards, all of which will collectively be referred to as the "Awards".

The A&R LTIP authorizes the Compensation Committee to administer the plan and designate eligible persons as participants, determine the type or types of Awards to be granted to an eligible person, determine the number of shares of stock or amount of cash to be covered by the Awards, approve the forms of award agreements for use under the plan, determine the terms and conditions of any Award, modify, waive or adjust any term or condition of an Award that has been granted, among other responsibilities delegated by the Company's Board.

and (xi) substitute awards, all of which are collectively referred to as the "Awards".

The A&R LTIP authorizes the Compensation Committee to administer the plan and designate eligible persons as participants, determine the type or types of Awards to be granted to an eligible person, determine the number of shares of stock or amount of cash to be covered by the Awards, approve the forms of award agreements for use under the plan, determine the terms and conditions of any Award, modify, waive or adjust any terms or conditions of an Award that has been granted, among other responsibilities delegated by the Company's Board.

In March 2025, the Company introduced performance-based restricted stock awards in addition to time-based restricted stock awards to further align the compensation of the Company's executive officers with the long-term growth and the interests of its shareholders.

Performance-based restricted stock awards represent 30 % of total executive award value and may be earned based on the Company’s achievement of total shareholder return ("TSR") relative to its peer group during the applicable three-year performance period.

Payouts for the executive officers can range from 0 % to 200 % of the target and have cliff-vesting after three years , with dividends paid on the number of shares vested.

As a result, the Company has reduced the remaining shares available to be granted as awards under the A&R LTIP by 168,406 shares (the full 200 %), which assumes the highest percentage payout for the performance-based restricted stock awards.

The fair value of performance awards were estimated as of the date of grant using a Monte Carlo simulation with the following assumptions:

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Year Ended December 31, 2025

Grant-date fair value

Risk-free interest rate

Volatility factor

Restricted Shares

The Company granted 413,554 , 183,605 and 346,869 restricted shares to executives, employees and independent directors of the Company during the years ended December 31, 2025, 2024 and 2023, respectively.

The Company estimates the fair values of the restricted shares as of the closing price of the Company's common stock on the grant date of the award, with the expense recognized as stock-based compensation on a straight-line basis over the vesting period.

The Company granted 124,418 in performance shares to executives during the year ended December 31, 2025.

The grant-date fair value of the awards was determined to be 148 % of the expected payout and is recognized as stock-based compensation expense on a straight-line basis over the requisite service period.

The holders of these restricted shares receive dividends, in arrears, once the shares vest.

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All current restricted shares granted have a service period between 3 and 36 months.

The Company estimates the fair values of the restricted shares as of the closing price of the Company's common stock on the grant date of the award, with the expense amortized on a straight-line basis and recognized over the vesting period.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The following table presents the Company's restricted stock activity during the year ended December 31, 2025, under the A&R LTIP:

2021 Long-Term Incentive Plan

Restricted Shares Weighted Average Grant Date Fair Value

Restricted Stock Awards

Performance Stock Awards

Weighted Average Grant Date Fair Value

Unvested at December 31, 2024

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_____________________

(1) For the year ended December 31, 2023, the weighted average fair value of restricted shares granted during the year was $ 28.68 .

(2) For the years ended December 31, 2024, and 2023 , the total fair value of restricted shares vested during the year was $ 7.1 million and $ 6.4 million , respectively.

For the years ended December 31, 2024, and 2023, the total share-based compensation expense was $ 8.1 million and $ 7.0 million, respectively.

For the years ended December 31, 2024, and 2023, share based compensation expense also included expense associated with equity awards attributable to separation agreements with former Company executives.

Share-based compensation expense is included in general and administrative costs in the Company's consolidated statements of operations for the restricted share awards granted under the A&R LTIP.

If shares are subject to forfeiture, the Company will recognize any forfeited shares as a reduction to share-based compensation expense in our consolidated statements of operations and a decrease to shareholders' equity in our consolidated balance sheets.

(1) For the years ended December 31, 2024, and 2023, the weighted average grant date fair value of restricted stock award shares granted during the year was $ 28.75 and $ 28.68 , respectively.

(2) For the years ended December 31, 2025, 2024 and 2023, the total fair value of restricted stock award shares vested during the year was $ 5.6 million, $ 7.1 million and $ 6.4 million , respectively.

(3) Performance shares granted during year ended December 31, 2025, are remeasured at the end of each reporting period based on the Company's TSR ranking as of the applicable period-end date.

The following table presents unrecognized stock-based compensation expense expected to be recognized and the related weighted average recognition period associated with unvested shares as of December 31, 2025:

Restricted Stock Awards

Performance Stock Awards

Unrecognized compensation expense (in millions)

Weighted average period for recognition (months)

For the years ended December 31, 2025, 2024 and 2023, the total stock-based compensation expense was $ 9.1 million, $ 8.1 million and $ 7.0 million, respectively.

For the years ended December 31, 2024, and 2023, stock-based compensation expense also included expense associated with equity awards attributable to separation agreements with former Company executives.

Stock-based compensation expense is included in general and administrative costs in the Company's consolidated statements of operations for the restricted stock awards granted under the A&R LTIP.

If shares are subject to forfeiture, the Company will recognize forfeitures as they occur as a reduction to stock-based compensation expense in our consolidated statements of operations and a decrease to shareholders' equity in our consolidated balance sheets.

Any unpaid dividends on forfeited shares will be recognized as a decrease to accrued liabilities and other non-current liabilities and an increase to shareholders' equity in our consolidated balance sheets.

Approximately $ 7.8 million of additional share-based compensation expense will be recognized over the weighted average life of 22 months for the unvested restricted share awards as of December 31, 2024, granted under the A&R LTIP.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Share Repurchases

In December 2025, our Board of Directors approved a stock repurchase program (the “Repurchase Program”) authorizing the repurchase of up to $ 100 million of our common stock from time to time over a period of 24 months, including through open market purchases, through block trades, in privately negotiated transactions, or by other means, including through the use of trading plans, each in accordance with applicable securities laws and other restrictions.

The Repurchase Program does not obligate us to purchase any common stock and may be suspended from time to time, modified, extended or discontinued by the Board at any time.

During the fourth quarter of 2025, no shares were purchased under the Repurchase Program.

The remaining repurchase authority under the Repurchase Program at December 31, 2025 was $ 100 million.

Share Retirements

On November 21, 2025, the Company retired 250,000 shares of our common stock received as consideration in connection with the Viking Sale.

As a result, the Company booked $ 10.2 million as a reduction to additional paid-in capital.

See Note 4 - Acquisitions and Divestitures for a full discussion of the Viking Sale.

At-The-Market Equity Sales Program ("ATM")

On September 1, 2023, the Company entered into an Equity Distribution Agreement in connection with an ATM pursuant to which the Company may offer and sell from time to time up to an aggregate $ 50 million in shares of the Company's common stock through our agents.

During the year ended December 31, 2025, the Company did not execute any sales under the ATM program.

4 unchanged sentences

The proceeds were used for financing an acquisition, repayment of outstanding debt and general corporate purposes.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

(12) Income Taxes

1 unchanged sentence

Year Ended December 31,

2025 2024 2023

(In thousands)

10 unchanged sentences

$ 48,123 $ 28,074 $ 34,461

_____________________

(1) For the year ended December 31, 2025 , a book tax benefit of $ 1.0 million related to the Viking Sale was recognized in additional paid-in capital.

See Note 4 - Acquisitions and Divestitures for additional information on the Viking Sale.

Deferred tax assets and liabilities are the result of temporary differences between the financial statement carrying values and the tax basis of our assets and liabilities.

The Company's net deferred tax position is as follows:

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Year Ended December 31,

1 unchanged sentence

Intangibles $ 129 $ 146

Share-based compensation 1,129 772

Stock-based compensation

Interest expense limitation — 19

9 unchanged sentences

Year Ended December 31,

Tax at statutory rate 21.0 % 21.0 %

2025 2024 2023

U.S federal statutory tax rate

$ 43,882 21.0 % $ 24,564 21.0 % $ 30,671 21.0 %

State income taxes, net of federal income tax effect (1)

5,278 2.5 % 2,839 2.4 % 3,400 2.4 %

Marginal well credit

( 1,700 ) ( 0.8 ) % — — % — — %

Nondeductible items:

Nondeductible compensation 887 0.4 % 828 0.7 % 1,064 0.7 %

Share-based compensation ( 0.1 ) % ( 0.5 ) %

State income taxes, net of federal benefit 2.4 % 2.4 %

Effective income tax rate 24.0 % 23.6 %

Stock-based compensation

( 237 ) ( 0.1 ) % ( 191 ) ( 0.1 ) % ( 739 ) ( 0.5 ) %

Other 13 — % 34 — % 65 — %

Effective tax rate

$ 48,123 23.0 % $ 28,074 24.0 % $ 34,461 23.6 %

_____________________

(1) State taxes in New Mexico and Texas make up the tax effect in this category.

Cash paid for income taxes, net of refunds, was as follows:

Year Ended December 31,

2025 2024 2023

(In thousands)

Total federal

$ 17,220 $ 17,245 $ 8,851

State and local:

$ 2,550 $ 159 $ 459

Total state and local

$ 3,345 $ 839 $ 1,098

Total income taxes paid, net of refunds

$ 20,565 $ 18,084 $ 9,949

The Company's federal income tax returns for the years subsequent to December 31, 2021, remain subject to examination.

The Company's income tax returns in major state income tax jurisdictions remain subject to examination for various periods subsequent to December 31, 2020.

The Company currently believes that all other significant filing positions are highly certain and that all of our other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on our consolidated financial statements.

Therefore, the Company has not established any significant reserves for uncertain tax positions.

The Company currently believes that all other significant filing positions are highly certain

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

and that all of our other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on our consolidated financial statements.

Therefore, the Company has not established any significant reserves for uncertain tax positions.

Section 382 of the Internal Revenue Code limits the utilization of U.S.

5 unchanged sentences

The deferred tax assets for the net operating losses, along with the other deferred tax assets as shown in the table above, are presented net with deferred tax liabilities, which primarily consist of book and tax depreciation, depletion and amortization differences.

On July 4, 2025, new tax legislation known as the One Big Beautiful Bill Act ("OBBBA") was signed into law.

The legislation, among other things, makes permanent, extends or modifies certain provisions under the 2017 Tax Cuts and Jobs Act, including permanent extension of 100% bonus depreciation for certain capital expenditures and the limitation on interest expense deductions.

The enactment of the OBBBA resulted in a $ 3.7 million reduction in our current income tax expense, with an offsetting increase in deferred income tax expense for the year ended December 31, 2025.

(13) Net Income Per Share

2 unchanged sentences

Year Ended December 31,

2025 2024 2023

(In thousands, except per share amounts)

11 unchanged sentences

Year Ended December 31,

Restricted shares

2025 2024 2023

(In thousands)

Restricted shares

(14) Segments

2 unchanged sentences

The Chief Operating Decision Maker ("CODM") function is a critical aspect of segment reporting, as defined by the FASB under the Accounting Standards Codification (ASC) 280.

The CODM is responsible for making key operating decisions and assessing the performance of the Company.

The CODM is responsible for making key operating decisions and

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

assessing the performance of the Company.

The CODM function at the Company is collectively performed by a committee consisting of the Chief Executive Officer ("CEO"), Chief Financial Officer ("CFO"), Chief Operating Officer ("COO"), and Chief Accounting Officer ("CAO").

3 unchanged sentences

In the CODM function, the CFO plays a crucial role in analyzing financial data, assessing financial performance, and making recommendations for resource allocation and investment decisions.

RILEY EXPLORATION PERMIAN, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The COO is responsible for the day-to-day operations of the Company.

14 unchanged sentences

Year Ended December 31,

2025 2024 2023

(In thousands)

6 unchanged sentences

Exploration costs

361 2,595 4,165

Depletion, depreciation, amortization and accretion

1 unchanged sentence

Impairment of oil and natural gas properties

1,214 11,317 9,760

Other impairments

1,607 30,158 —

Administrative Costs

31,472 26,551 26,569

Share-based compensation expense

Stock-based compensation expense

9,130 8,138 6,833

Other segment items (1)

5,176 1,936 6,396

Interest expense, net of capitalized interest (2)

4 unchanged sentences

Loss from equity method investment 886 721 218

Gain on midstream sale

( 71,675 ) — —

Income tax expense

4 unchanged sentences

Capital expenditures (4)

$ 120,162 $ 108,320 $ 135,804

Equity method investment $ 36,188 $ 22,811 $ 5,620

3 unchanged sentences

(3) There are no reconciling items between net income presented in our consolidated statements of operations and segment net income.

(4) Capital expenditures are accrual (activity-based) before acquisitions.

(15) Commitments and Contingencies

12 unchanged sentences

Contractual Commitments

In August 2022, the Company entered into a second amendment on our gas gathering, treating and processing agreement with our primary midstream counterparty, Stakeholder Midstream, LLC (“Stakeholder”).

Stakeholder committed to expand their gathering and processing system with a commitment from the Company to deliver an annual minimum volume to Stakeholder’s gathering system with less than seven years remaining as of December 31, 2024.

In January 2023, the Company entered into the Tolling Agreement which uses the Company's produced natural gas to power a portion of our oilfield operations in Yoakum County, Texas.

Under the Tolling Agreement, the Company has committed to provide specified quantities of our natural gas for 10 years following the in-service date of September 2024, for a fee based on a per MMBtu basis adjusted for contractual usage factors.

In June 2024, the Company entered into the A&R Tolling Agreement which superseded the Tolling Agreement to change the new in-service date to September 2024.

The Company also entered into the Asset Optimization Agreement in January 2023 that requires RPC Power to provide operational expertise on the implementation and management of the power generating assets subject to the A&R Tolling Agreement for a monthly fee of $ 20 thousand.

In May 2024, the Company entered into a 10-year natural gas supply agreement (“Supply Agreement”) with RPC Merchant LLC to supply natural gas to fuel the natural gas generators under the Merchant Deal.

The Company's commitment under the Supply Agreement is contingent upon project start-up which is expected to occur beginning in late 2025 through 2026.

In May 2024, the Company increased our ownership interest in RPC Power from 35 % to 50 %.

The Company also has a remaining commitment to invest up to an additional $ 27.7 million to fund our portion of the 2025 capital budget for the RPC Power joint venture.

The Company is a party to a gas gathering, treating and processing agreement with Stakeholder in Texas.

Under the terms of the agreement, the Company agreed to deliver an annual minimum volume during the contract term.

As of December 31, 2025, approximately five years remain under the contract.

Under the A&R Tolling Agreement with RPC Power, the Company has committed to provide specified quantities of our natural gas for 10 years following the in-service date of September 2024, for a fee based on a per MMBtu basis adjusted for contractual usage factors.

The Company also entered into the Asset Optimization Agreement that requires RPC Power to provide operational expertise on the implementation and management of the power generating assets subject to the A&R Tolling Agreement for a monthly fee of $ 20 thousand.

Under the Supply Agreement with RPC Merchant, the Company agreed to supply natural gas to fuel the natural gas generators under the Merchant Deal for 10 years.

The Company's commitment under the Supply Agreement is contingent upon project start-up which is expected to commence in 2026.

Under the A&R LLC Agreement with RPC Power, the Company agreed to make additional capital contributions to fund its portion of the capital budget for RPC Power.

The Company's remaining commitment, if required, is $ 12 million.

See Note 8 - Equity Method Investment and Note 9 - Transactions with Related Parties for additional information related to RPC Power.

Gas Purchase Agreement

On December 31, 2024, the Company signed a long-term gas purchase agreement for our New Mexico field with a new midstream counterparty, which includes dedicated acreage for a significant portion of the Company’s oil and gas assets in New Mexico, reimbursement by the Company of construction costs incurred by the midstream counterparty to connect to the Company’s pipeline (subject to a monetary cap of $ 18.7 million) and an initial 15 -year term from the in-service date followed by a year-to-year continuation until terminated by either party upon 180 days written notice.

In conjunction with the agreement, the Company intends to construct, own and operate low and high-pressure gathering lines and compression facilities that will connect to our new high capacity 20 -inch natural gas pipeline to be constructed by the Company and designed to handle gas volumes of up to 150 MMcf per day.

We currently anticipate the in-service date will be before the end of 2026.

Midstream Gas Purchase Agreement

On December 31, 2024, the Company signed a long-term gas purchase agreement for the Company's New Mexico field with Targa, which was amended and restated as the A&R Gas Purchase Agreement in connection with the Midstream Sale.

The agreement has a minimum volume commitment in New Mexico for an initial 15 -year term from the in-service date, which is expected to commence before the end of 2026.

(16) Subsequent Events

1 unchanged sentence

On January 9, 2026, the Board of Directors of the Company declared a cash dividend of $ 0.40 per share of common stock paid on February 5, 2026, to our shareholders of record at the close of business on January 22, 2026.

Equity Contribution to RPC Power

On February 28, 2025, the Company contributed an additional $ 6.3 million to RPC Power, which increased our total capital contributions to $ 30 million.

Stock Repurchase Program

The Company began repurchasing outstanding shares of the Company's common stock during the first quarter of 2026 as part of the previously announced stock repurchase program.

As of February 28, 2026, the Company has repurchased 152,408 shares for a weighted average price of $ 26.54 , for a total consideration of $ 4.0 million.

On January 6, 2026, the Company entered into a 15-year water management services agreement ("Waterbridge Agreement") with Waterbridge Stateline LLC ("Waterbridge") to deliver a portion of its New Mexico produced water for disposal purposes within a specified dedicated area.

During the first 7 years of the agreement, the Company has both annual and a cumulative volume commitment to deliver minimum quantities of produced water.

The in-service date is expected to be September 2026.

Sale of Non-Operating Interests

On February 10, 2026, the Company sold its interest in a non-operating unit that included 3 producing wells and 5 proposed non-operated wells for approximately $ 2 million plus reimbursement of $ 5.7 million in prepaid drilling costs.

At December 31, 2025, the $ 5.7 million prepayment was included in prepaid expenses in our Consolidated Balance Sheet.

SUPPLEMENTAL OIL AND GAS INFORMATION

13 unchanged sentences

Year Ended December 31,

2025 2024 2023

(In thousands)

11 unchanged sentences

Year Ended December 31,

2025 2024 2023

(In thousands)

Oil, natural gas and NGL sales $ 409,801 $ 372,647

Oil and natural gas sales, net

$ 391,980 $ 409,801 $ 372,647

Lease operating expenses 87,506 71,463 58,817

1 unchanged sentence

Exploration costs 361 2,595 4,165

Depletion, accretion and amortization 74,025 64,471

Depletion and accretion

91,617 74,025 64,471

Impairment of oil and natural gas properties 1,214 11,317 9,760

7 unchanged sentences

Oil, Natural Gas and NGL Quantities

Our reserve report for the year ended December 31, 2024, and 2023 , was prepared by Ryder Scott Company, L.P.

Our reserve reports for the years ended December 31, 2025, 2024 and 2023 were prepared by Ryder Scott Company, L.P.

All reserves are located within the continental United States.

11 unchanged sentences

December 31, 2022 48,882 86,018 14,454 77,673

Acquisitions 12,810 39,261 6,711 26,064

Extensions and discoveries 14,822 22,945 4,224 22,870

Revisions ( 5,403 ) ( 18,411 ) ( 3,634 ) ( 12,106 )

Production ( 4,803 ) ( 5,865 ) ( 1,006 ) ( 6,786 )

December 31, 2023 66,308 123,948 20,749 107,715

1,989 6,624 1,176 4,269

4 unchanged sentences

5,054 18,428 3,070 11,195

( 900 ) ( 658 ) ( 180 ) ( 1,190 )

Extensions and discoveries 11,761 33,468 6,217 23,557

6 unchanged sentences

December 31, 2024 40,111 103,337 19,312 76,646

December 31, 2025 42,907 124,165 23,109 86,710

Proved Undeveloped Reserves, Included Above

2 unchanged sentences

December 31, 2024 26,424 58,902 10,715 46,956

As of December 31, 2024, proved reserves were comprised of 53.8 % oil, 21.9 % natural gas and 24.3 % NGL.

2024 proved reserves were estimated based on average realized prices of $ 74.27 per Bbl of oil, $( 0.43 ) per Mcf of natural gas and $( 3.56 ) per Bbl of NGL.

Prices used in the 2024 reserve report are based on the twelve month unweighted arithmetic average of the first-day-of-the-month price for each month in the period ("SEC price") January 2024 through December 2024.

For oil and NGL volumes, the average WTI SEC price of $ 76.32 per Bbl was adjusted for quality, transportation fees, and market differentials which were included as a deduction to oil revenue.

For gas volumes, the average Henry Hub SEC price of $ 2.13 per MMBtu is adjusted for energy content, transportation fees and market differentials which were included as a deduction to natural gas revenue.

As of December 31, 2023, proved reserves were comprised of 61.5 % oil, 19.2 % natural gas and 19.3 % NGL.

2023 proved reserves were estimated based on average realized prices of $ 76.02 per Bbl of oil, $ 0.46 per Mcf of natural gas and $ 7.11 per Bbl of NGL.

Prices used in the 2023 reserve report are based on the twelve month unweighted arithmetic average of the first-day-of-the-month price for each month in the period January 2023 through December 2023.

For oil and NGL volumes, the average WTI SEC price of $ 78.22 per Bbl is adjusted for quality, transportation fees, and market differentials.

The fees associated with the transportation contract are included as a deduction to oil revenue.

For gas volumes, the average Henry Hub SEC price of $ 2.64 per MMBtu is adjusted for energy content, transportation fees and market differentials.

December 31, 2025 31,440 82,492 15,516 60,705

The following table breaks out the composition of proved reserves by commodity, expressed as a percentage of total proved reserves;

the average WTI and Henry Hub prices used in the reserve report;

and the average realized prices used to estimate our reserves.

The WTI and Henry Hub prices are based on the twelve month unweighted arithmetic average of the

SUPPLEMENTAL OIL AND GAS INFORMATION - (continued)

first-day-of-the-month price for each month in the period, and then adjusted for quality, energy content, GP&T costs and market differentials to determine our average realized prices.

2025 2024 2023

Proved Reserves:

50.4 % 53.8 % 61.5 %

23.4 % 21.9 % 19.2 %

26.2 % 24.3 % 19.3 %

Average WTI Price

$ 65.34 $ 76.32 $ 78.22

Average Henry Hub price

$ 3.39 $ 2.13 $ 2.64

Average Realized Prices:

Oil ($ per Bbl) $ 64.01 $ 74.27 $ 76.02

Natural gas ($ per Mcf) $ 0.02 $ ( 0.43 ) $ 0.46

NGLs ($ per Bbl)

$ ( 0.15 ) $ ( 3.56 ) $ 7.11

_____________________

(1) The Company's oil, natural gas and NGL sales are presented net of GP&T costs.

These costs, related to natural gas and NGLs, at times exceeded the price we received and resulted in negative average realized prices.

For the year ended December 31, 2025, the Company added 23.8 MMBoe of proved reserves, with such additions due to extensions and discoveries, acquisitions and positive revisions, partially offset by production and the Viking divestiture.

The Company had acquisitions of 11.2 MMBoe primarily as a result of the Silverback Acquisition and extensions and discoveries of proved reserves of 23.6 MMBoe, which consisted of 0.6 MMBoe added to PDPs as a result of drilling successful wells that were previously classified as unproved locations and 23.0 MMBoe added to PUDs as a result of drilling activity during the year, which allowed for the booking of adjacent PUDs for locations that were previously booked as unproved reserves or not at all.

The Viking divestiture resulted in a reduction of 1.2 MMBoe.

The Company had upward revisions of previous estimates of 0.9 MMBoe, including 7.0 MMBoe of positive revisions which were partially offset by 6.1 MMBoe of negative revisions.

Our positive revisions were primarily due to type-curve and production forecast changes for natural gas and NGLs of 5.1 MMBoe in addition to a decrease in operating expenses that caused positive revisions of 1.9 MMBoe.

These positive revisions were partially offset by negative revisions which included development plan changes driven by shifting focus to more profitable areas of our assets, which resulted in the removal of PUD locations representing 2.9 MMBoe of PUD reserves from our 5-year forecast, 2.3 MMBoe due to lower commodity prices and 0.9 MMBoe due to interest changes.

Consistent with Securities and Exchange Commission ("SEC") guidelines, PUDs are limited to those locations that are reasonably certain to be developed within five years.

For the year ended December 31, 2024, the Company added 15.9 MMBoe of proved reserves, with such additions due to extensions and discoveries, positive revisions and acquisitions, partially offset by production.

1 unchanged sentence

The Company had upward revisions of previous estimates of 4.3 MMBoe, including 15.3 MMBoe of positive revisions which were partially offset by 11.0 MMBoe of negative revisions.

Our positive revisions were primarily due to increased forecasted natural gas sales volumes of 9.2 MMBoe based on improved gas processing capacity in

SUPPLEMENTAL OIL AND GAS INFORMATION - (continued)

addition to a decrease in operating expenses and midstream fees that caused positive revisions of 6.1 MMBoe.

Our positive revisions were primarily due to increased forecasted natural gas sales volumes of 9.2 MMBoe based on improved gas processing capacity in addition to a decrease in operating expenses and midstream fees that caused positive revisions of 6.1 MMBoe.

These positive revisions were partially offset by negative revisions which included development plan changes driven by shifting focus to more profitable areas of our assets, which resulted in the removal of PUD locations representing 4.2 MMBoe of PUD reserves from our 5-year forecast, 2.6 MMBoe due to type curve updates, 2.0 MMBoe due to interest changes, 1.5 MMBoe due to lower commodity prices and 0.7 MMBoe due to reserve category changes.

Consistent with Securities and Exchange Commission ("SEC") guidelines, PUDs are limited to those locations that are reasonably certain to be developed within five years.

For the year ended December 31, 2023, the Company had added 30.0 MMBoe of proved reserves, with such additions due to acquisitions and extensions and discoveries, partially offset by negative revisions and production.

The Company had acquisitions of 26.1 MMBoe primarily as a result of the 2023 New Mexico Acquisition and extensions and discoveries to proved reserves of 22.9 MMBoe, which consisted of 8.3 MMBoe added to PDP as a result of drilling successful wells that were previously classified as unproved locations, and 14.6 MMBoe added to PUDs as a result of drilling successful wells offsetting locations that were previously unproven locations.

For the year ended December 31, 2023, the Company added 30.0 MMBoe of proved reserves, with such additions due to acquisitions and extensions and discoveries, partially offset by negative revisions and production.

The Company had

SUPPLEMENTAL OIL AND GAS INFORMATION - (continued)

acquisitions of 26.1 MMBoe primarily as a result of the 2023 New Mexico Acquisition and extensions and discoveries to proved reserves of 22.9 MMBoe, which consisted of 8.3 MMBoe added to PDP as a result of drilling successful wells that were previously classified as unproved locations, and 14.6 MMBoe added to PUDs as a result of drilling successful wells offsetting locations that were previously unproven locations.

The Company had downward revisions of previous estimates of 12.1 MMBoe, including 19.3 MMBoe of negative revisions which were partially offset by 7.2 MMBoe of positive revisions.

18 unchanged sentences

The following summary sets forth the Company’s future net cash flows relating to proved oil, natural gas and NGL reserves based on the standardized measure prescribed in ASC Topic 932:

Year Ended December 31,

2025 2024 2023

(In thousands)

Future crude oil, natural gas and NGLs sales (1)(2)

Future oil and natural gas sales, net (1)(2)(3)

$ 4,757,093 $ 4,764,599 $ 5,244,927

8 unchanged sentences

(2) December 31, 2024, proved reserves were derived based on average realized prices of $ 74.27 per barrel of oil, $( 0.43 ) per Mcf of natural gas and $( 3.56 ) per barrel of NGL.

(3) December 31, 2023, proved reserves were derived based on average realized prices of $ 76.02 per barrel of oil, $ 0.46 per Mcf of natural gas and $ 7.11 per barrel of NGL.

Principal sources of change in the Standardized Measure are shown below:

Year Ended December 31,

2025 2024 2023

(In thousands)

Balance, beginning of period $ 1,241,801 $ 1,260,465 $ 1,108,376

Sales of crude oil, natural gas and NGLs, net ( 308,907 ) ( 288,270 )

Net change in prices and production costs ( 238,938 ) ( 618,441 )

Oil and natural gas sales, net of production costs

( 275,420 ) ( 308,907 ) ( 288,270 )

Net change in future prices and production costs

( 285,208 ) ( 238,938 ) ( 618,441 )

Net changes in future development costs 23,095 9,976 21,423

1 unchanged sentence

Acquisition of reserves 120,029 47,020 613,295

Divestiture of reserves

( 15,473 ) — —

Revisions of previous quantity estimates 26,578 71,800 ( 188,364 )

2 unchanged sentences

Accretion of discount 154,258 158,406 140,115

Other ( 48,225 ) 61,701

Changes in timing and other

( 125,706 ) ( 48,225 ) 61,701

Balance, end of period $ 1,141,090 $ 1,241,801 $ 1,260,465

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 9A. Controls and Procedures