StandardAero, Inc. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA INDEX TO FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB ID: 238 ) 71 Report of Independent Registered Public Accounting Firm (PCAOB ID: 271) 74 Consolidated Balance Sheets as of December 31, 2025 and 2024 75 Consolidated Statements of Operations for the Years ended December 31, 2025, 2024 and 2023 76 Consolidated Statements of Comprehensive Income (Loss) for the Years ended December 31, 2025, 2024 and 2023 77 Consolidated Statements of Stockholders’ Equity for the Years ended December 31, 2025, 2024 and 2023 78 Consolidated Statements of Cash Flows for the Years ended December 31, 2025, 2024 and 2023 79 Notes to Consolidated Financial Statements 80 70 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of StandardAero, Inc. Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of StandardAero, Inc. and its subsidiaries (the "Company") as of December 31, 2025 and 2024, and the related consolidated statements of operations, of comprehensive income (loss), of stockholders’ equity and of cash flows for the years then ended, including the related notes (collectively referred to as the "consolidated financial statements"). We also have audited 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). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, 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. Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO because material weaknesses in internal control over financial reporting existed as of that date related to the Company not designing and maintaining (i) an effective control environment commensurate with the Company’s financial reporting requirements, including an insufficient complement of personnel with an appropriate level of knowledge, training and experience; (ii) effective monitoring controls to verify the proper and consistent functioning of the Company’s internal controls; (iii) effective controls related to the period-end financial reporting process and significant account balances, including a lack of adequately documented evidence of a sufficient level of management review over complex estimates and judgmental areas of accounting and financial reporting; and (iv) effective information technology general controls over program change management, user access, and computer operations. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses referred to above are described in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. We considered these material weaknesses in determining the nature, timing, and extent of audit tests applied in our audit of the 2025 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements. Basis for Opinion The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in management's report referred to above. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and 71 performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matters 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 (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of 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 matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Revenue Recognition – Certain In-Progress Fixed Price and Time and Material Contracts As described in Note 2 to the consolidated financial statements, as performance obligations are satisfied over time, the Company recognizes revenue using an input method with revenue amounts being recognized proportionately as costs are incurred relative to total expected costs to satisfy the performance obligation. Revenue is recognized over time as work progresses, as the services performed by the Company enhance customer-controlled assets. Management believes that costs incurred are an appropriate measure of progress towards satisfaction of the performance obligation since this measure reasonably depicts the progress of the work effort. To determine the revenue recognized at each period end for contracts in progress, the Company has elected to use a portfolio approach by applying an estimated margin by engine platform to the contract costs incurred. The estimated margin by engine platform is based on average historical margins on similar completed contracts. Judgment is required by management when determining the estimated margin by engine platform, which includes evaluating the appropriateness of using average historical margins by engine platform for completed contracts on similar contracts in progress. For the year ended December 31, 2025, the Company’s revenue was $6.1 billion, of which a portion relates to certain in-progress fixed price and time and material contracts. 72 The principal considerations for our determination that performing procedures relating to revenue recognition for certain in-progress fixed price and time and material contracts is a critical audit matter are (i) the significant judgment by management when developing the estimated margin by engine platform used to determine the amount of revenue to recognize for certain fixed price and time and materials contracts in progress and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumption related to estimated margin by engine platform. As described in the “Opinions on the Financial Statements and Internal Control over Financial Reporting” section, material weaknesses were identified that impacted this matter. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others (i) testing management’s process for developing the estimate of revenue recognized for certain in-progress fixed price and time and material contracts; (ii) testing costs incurred for a sample of contracts by obtaining and inspecting third-party invoices and other supporting documents; (iii) evaluating the reasonableness of the significant assumption used by management related to the estimated margin by engine platform; and (iv) recalculating the revenue recognized for certain fixed price and time and materials contracts in progress based on the estimated margin by engine platform. Evaluating management’s assumption related to the estimated margin by engine platform involved evaluating whether the assumption used by management was reasonable considering, for a sample of contracts (i) comparing management’s estimated margin by engine platform to historical margins of similar completed contracts and (ii) considering whether the assumption was consistent with evidence obtained in other areas of the audit. /s/ PricewaterhouseCoopers LLP Phoenix, Arizona February 25, 2026 We have served as the Company’s auditor since 2024. 73 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of StandardAero, Inc. Opinion on the Financial Statements We have audited the consolidated statements of operations, comprehensive income (loss), stockholders’ equity and cash flows of StandardAero, Inc. (formerly Dynasty Parent Co., Inc.) and its subsidiaries (the Company) for the year ended December 31, 2023, including 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 results of operations and cash flows of the Company for the year ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion. /s/ PricewaterhouseCoopers LLP Chartered Professional Accountants, Licensed Public Accountants Toronto, Canada June 7, 2024, except for the change in composition of reportable segments discussed in Note 24 (not presented herein) to the consolidated financial statements appearing in the Company’s Form S-1 Registration Statement, Note 25 and the additional disclosure of revenue by end-market in Note 3 to the consolidated financial statements, as to which the date is August 19, 2024, except for the effects of the forward stock split and the additional disclosure with respect to the increase in authorized shares discussed in Note 1 to the consolidated financial statements, as to which the date is September 23, 2024, and except for the effects of the distribution of the restricted shares as discussed in Note 4 to the consolidated financial statements, as to which the date is March 12, 2025 We served as the Company's auditor from 2016 to 2024. 74 STANDARDAERO, INC. C ONSOLIDATED BALANCE SHEETS (In thousands, except share figures) December 31, December 31, 2025 2024 ASSETS Current assets: Cash $ 289,717 $ 102,581 Accounts receivable (less allowance for expected credit losses of $ 13,484 and $ 15,455 , respectively) 654,390 580,668 Contract assets, net 1,071,703 915,200 Inventories 827,691 847,018 Prepaid expenses and other current assets 42,776 29,707 Income tax receivable 10,182 9,960 Total current assets 2,896,459 2,485,134 Property, plant and equipment, net 579,971 568,607 Operating lease right of use asset, net 222,151 172,206 Customer relationships, net 920,432 1,004,701 Other intangible assets, net 244,877 291,487 Goodwill 1,684,255 1,685,970 Other assets 6,434 4,417 Deferred income tax assets 2,832 1,079 Total assets $ 6,557,411 $ 6,213,601 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 679,772 $ 645,701 Accrued expenses and other current liabilities 91,499 99,572 Accrued employee costs 74,008 79,134 Operating lease liabilities, current 22,308 17,663 Due to related parties 438 1,345 Contract liabilities 411,321 400,025 Income taxes payable, current 13,547 6,655 Long-term debt, current portion 23,444 23,449 Total current liabilities 1,316,337 1,273,544 Long-term debt 2,191,161 2,207,977 Operating lease liabilities, non-current 212,365 164,224 Deferred income tax liabilities 157,206 169,824 Income taxes payable, non-current 5,770 — Other non-current liabilities 7,261 24,628 Total liabilities 3,890,100 3,840,197 Commitments and contingencies (Note 15) Stockholders' equity Common stock ($0.01 par value, 3,500,000,000 shares authorized; 334,461,630 issued and 334,294,245 outstanding as of December 31, 2025 and 334,461,630 shares issued and outstanding as of December 31, 2024) 3,345 3,345 Preferred stock ($ 0.01 par value, 100,000,000 shares authorized; no shares were issued) — — Additional paid-in capital 3,958,039 3,944,802 Accumulated deficit ( 1,285,904 ) ( 1,563,321 ) Accumulated other comprehensive loss ( 8,169 ) ( 11,422 ) Treasury stock (at cost, 176,019 and 0 shares as of December 31, 2025 and December 31, 2024) — — Total stockholders' equity 2,667,311 2,373,404 Total liabilities and stockholders' equity $ 6,557,411 $ 6,213,601 The accompanying notes are an integral part of the consolidated financial statements. 75 STANDARDAERO, INC. CONSOL IDATED STATEMENTS OF OPERATIONS (In thousands, except per share figures) Year Ended December 31, 2025 2024 2023 Revenue $ 6,062,513 $ 5,237,161 $ 4,563,284 Cost of revenue 5,165,060 4,483,019 3,927,965 Selling, general and administrative expense 247,703 254,092 202,766 Amortization of intangible assets 98,681 95,457 93,681 Acquisition costs — 1,374 1,514 Operating income 551,069 403,219 337,358 Interest expense 174,217 282,507 309,645 Refinancing costs — 23,700 19,921 Loss on debt extinguishment — 15,255 6,182 Other income — — ( 3,509 ) Income before income taxes 376,852 81,757 5,119 Income tax expense 99,435 70,783 40,180 Net income (loss) $ 277,417 $ 10,974 $ ( 35,061 ) Earnings (loss) per share: Basic $ 0.84 $ 0.04 $ ( 0.13 ) Diluted $ 0.83 $ 0.04 $ ( 0.13 ) Weighted-average shares of common stock outstanding Basic 328,448 288,415 275,175 Diluted 334,321 289,799 275,175 The accompanying notes are an integral part of the consolidated financial statements. 76 STANDARDAERO, INC. CONSOLIDATE D STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (In thousands) Year Ended December 31, 2025 2024 2023 Net income (loss) $ 277,417 $ 10,974 $ ( 35,061 ) Other comprehensive income (loss), net of tax: Unrealized income on cash flow hedge, net of income tax expense of $ 201 , $ 1,012 and $ 885 , respectively 124 3,242 957 Cash flow hedge loss (gain) reclassified to the statement of operations, net of income tax (benefit) expense of ($ 1,249 ), $ 2,406 and $ 4,547 , respectively 4,271 ( 7,579 ) ( 14,049 ) Employee benefit plan, (loss) gains, net of amortization, and net of income tax benefit (expense) of $ 371 , ($ 145 ) and $ 1,479 , respectively ( 1,142 ) 244 ( 4,546 ) Foreign currency translation adjustment — ( 367 ) 383 Total other comprehensive income (loss) 3,253 ( 4,460 ) ( 17,255 ) Comprehensive income (loss) $ 280,670 $ 6,514 $ ( 52,316 ) The accompanying notes are an integral part of the consolidated financial statements. 77 STANDARDAERO, INC. CONSOLIDAT ED STATEMENTS OF STOCKHOLDERS' EQUITY (In thousands, except share figures) Common Stock Treasury Stock Number of Shares Par Value Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Number of Shares Par Value Total Shareholder's Equity Balance as of December 31, 2022 281,211,630 $ 2,812 $ 2,725,157 $ ( 1,539,234 ) $ 10,293 — $ — $ 1,199,028 Net loss — — — ( 35,061 ) — — — ( 35,061 ) Other comprehensive loss, net of tax — — — — ( 17,255 ) — — ( 17,255 ) Balance as of December 31, 2023 281,211,630 2,812 2,725,157 ( 1,574,295 ) ( 6,962 ) — — 1,146,712 Net income — — — 10,974 — — — 10,974 Initial public offering, net 53,250,000 533 1,202,269 — — — — 1,202,802 Share based compensation — — 17,376 — — — — 17,376 Other comprehensive loss, net — — — — ( 4,460 ) — — ( 4,460 ) Balance as of December 31, 2024 334,461,630 3,345 3,944,802 ( 1,563,321 ) ( 11,422 ) — — $ 2,373,404 Net income — — — 277,417 — — — 277,417 Vesting of restricted stock 8,634 — — — — — — — Forfeiture of restricted stock awards ( 176,019 ) 176,019 — — Share based compensation — — 13,237 — — — — 13,237 Other comprehensive income, net — — — — 3,253 — — 3,253 Balance as of December 31, 2025 334,294,245 $ 3,345 $ 3,958,039 $ ( 1,285,904 ) $ ( 8,169 ) 176,019 $ — $ 2,667,311 The accompanying notes are an integral part of the consolidated financial statements. 78 STANDARDAERO, INC. C ONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year Ended December 31, 2025 2024 2023 Operating activities Net income (loss) $ 277,417 $ 10,974 $ ( 35,061 ) Adjustments to reconcile net loss from operations to net cash provided by operating activities: Depreciation and amortization 193,664 187,080 197,104 Amortization of deferred finance charges and discounts 6,535 11,921 15,312 Amortization of loss on derivative instruments — ( 304 ) ( 1,412 ) Amortization of interest cap premiums 9,855 10,156 6,301 Payment of interest rate cap premiums ( 10,097 ) ( 10,211 ) ( 5,948 ) Stock compensation expense 13,237 17,376 — Loss on debt extinguishment — 15,255 6,182 Loss (gain) from disposals, net 2,838 482 ( 14 ) Non-cash lease expense 2,869 1,612 1,400 Deferred income taxes ( 15,786 ) ( 22,514 ) ( 19,847 ) Foreign exchange gain (loss), net ( 1,327 ) ( 1,440 ) 3,186 Changes in operating assets and liabilities, net of effect of acquisitions: Accounts receivable, net ( 73,722 ) ( 58,268 ) 18,714 Contract assets, net ( 156,503 ) ( 92,368 ) ( 130,101 ) Inventories, net 19,327 ( 138,008 ) ( 91,245 ) Prepaid expenses and other current assets ( 15,816 ) 5,231 26,262 Accounts payable, accrued expenses and other current liabilities 41,385 104,375 ( 25,743 ) Contract liabilities 11,296 43,169 137,353 Due to/from related parties ( 907 ) 1,483 ( 276 ) Income taxes payable and receivable 12,440 ( 9,671 ) ( 34,274 ) Net cash provided by operating activities 316,705 76,330 67,893 Investing activities Acquisitions, net of cash and other 1,285 ( 114,073 ) ( 31,054 ) Purchase of property, plant and equipment ( 82,408 ) ( 102,935 ) ( 55,129 ) Payments for purchase of intangible assets ( 30,403 ) ( 20,250 ) ( 30,180 ) Proceeds from disposal of property, plant and equipment 5,124 1,812 3,508 Net cash used in investing activities ( 106,402 ) ( 235,446 ) ( 112,855 ) Financing activities Proceeds from IPO, net — 1,202,802 — Proceeds from long-term debt 715,000 3,247,000 1,479,568 Repayment of long-term debt ( 738,449 ) ( 4,235,510 ) ( 1,488,369 ) Payment of deferred financing charges — ( 9,276 ) ( 2,892 ) Repayments of long-term agreements ( 2,058 ) ( 1,260 ) ( 2,994 ) Net cash (used in) provided by financing activities ( 25,507 ) 203,756 ( 14,687 ) Effect of exchange rate changes on cash 2,340 ( 41 ) ( 2,434 ) Net increase (decrease) in cash 187,136 44,599 ( 62,083 ) Cash at beginning of the period 102,581 57,982 120,065 Cash at end of the period $ 289,717 $ 102,581 $ 57,982 Supplemental cash flow information: Cash paid during the period Interest $ 166,783 $ 291,150 $ 297,334 Income taxes, net of tax refunds 102,470 101,652 99,506 Supplemental disclosure of non-cash investing activities: Portion of capital expenditures in accrued expenses and other current liabilities $ 1,138 $ 1,823 $ 541 Acquisition of intangible assets, liability incurred but not paid — 30,261 — The accompanying notes are an integral part of the consolidated financial statements. 79 STANDARDAERO, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1: NATURE OF OPERATIONS AND BASIS OF PRESENTATION Nature of Business StandardAero, Inc. (the “Company”) was incorporated on September 5, 2018, in the state of Delaware and is an independent provider of aftermarket services for fixed and rotary wing aircraft gas turbine engines and auxiliary power units (“APUs”) to the commercial, business and military aircraft markets. The Company also provides aftermarket and upgrade services for business aviation and helicopter airframes and avionics, providing customers within those markets with comprehensive value-added solutions. Basis of Presentation The accompanying consolidated financial statements are prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of StandardAero, Inc. (formerly Dynasty Parent Co., Inc.) and its subsidiaries. Authorized Shares On September 20, 2024, the Company amended its certificate of incorporation to increase the number of authorized voting common stock from 5,000,000 to 3,500,000,000 and authorized non-voting common stock from 100,000 to 70,000,000 . Accordingly, the authorized share amounts disclosed in the consolidated balance sheets have been adjusted to retroactively reflect this change. Corporate Restructuring and Restructuring Transactions In connection with and prior to the completion of the Company’s initial public offering (the “IPO”) of its shares of common stock, $ 0.01 par value per share (“Common Stock”), the Company effected certain restructuring transactions. These restructuring transactions consisted of (i) the 103-for-one forward stock split of the Company’s Common Stock effected on September 20, 2024, (ii) the distribution to former holders of Class A-1 Units and Class A-2 Units of Dynasty Parent Holdings, L.P. an aggregate of 275,053,375 shares of the Company’s Common Stock (of which 8,157 were restricted shares), and to holders of Class B Units of Dynasty Parent Holdings, L.P. an aggregate of 6,158,255 shares of the Company’s Common Stock (of which 6,028,394 were restricted shares) and (iii) the liquidation and dissolution of Dynasty Parent Holdings, L.P. (collectively, the “Restructuring Transactions”). Immediately following these Restructuring Transactions, 281,211,630 shares of our Common Stock were issued and outstanding. Initial Public Offering On October 2, 2024, the Company completed the IPO at a price to the public of $ 24.00 per share. The offering included 69,000,000 shares of Common Stock, of which, the Company issued and sold 53,250,000 shares and the selling stockholders sold 15,750,000 shares, including 9,000,000 shares issued pursuant to the full exercise of the underwriters' option to purchase additional shares from the selling stockholders. The shares of Common Stock sold in the IPO were registered under the Securities Act pursuant to a Registration Statement on Form S-1, which was declared effective by the SEC on October 1, 2024. The IPO generated net proceeds from the primary issuance of shares of $ 1,202.8 million after deducting underwriting discounts and commissions of approximately $ 67.1 million and estimated offering expenses of $ 8.1 million. 80 March Secondary Offering In March 2025, two of the Company’s stockholders (the “Selling Stockholders”), affiliates of The Carlyle Group Inc. (“Carlyle”) and GIC Private Limited (“GIC”), completed a public offering of an aggregate of 36,000,000 shares of Common Stock at a price to the public of $ 28.00 per share. The Selling Stockholders received all of the net proceeds from this offering. No shares were sold by the Company. May Secondary Offering In May 2025, the Selling Stockholders completed a public offering of an aggregate of 34,500,000 shares of Common Stock (including the full exercise by the underwriters of their option to purchase up to an additional 4,500,000 shares) at a price to the public of $ 28.00 per share. The Selling Stockholders received all of the net proceeds from this offering. No shares were sold by the Company. As of December 31, 2025 Carlyle and GIC own approxim ately 45.6 % and 10.3 % of the Company’s outstanding Common Stock, respectively. NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. The continuous assessment of variable interest entities (“VIEs”) puts emphasis on a qualitative rather than quantitative analysis to determine the primary beneficiary of a VIE. A VIE must be consolidated if the Company has both (i) the power to direct the activities of the VIE that most significantly impact the entity’s economic performance, and (ii) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company is involved in an entity that qualifies as a VIE. This entity is a trust account in which the customer deposits cash related to an engine repair and maintenance agreement, generally in advance of the services to be performed under the contract, based on an agreed upon engine operating fee. The financial arrangement results in the Company receiving financial benefits from the VIE, however, it does not empower the Company to direct the activities of the VIE that most significantly impact the VIEs’ economic performance. Consequently, the VIE is not consolidated into the financial results of the Company. The VIE had restricted cash equivalents of $ 1.5 million and $ 18.3 million at December 31, 2025 and 2024 , respectively. Segment information The Company determined its operating segments after considering the Company’s organizational structure and the information regularly reviewed by the chief operating decision maker (“CODM”) to evaluate financial performance and allocate resources. The Company’s chief executive officer , who is the CODM, reviews financial information on an operating segment basis for purposes of evaluating financial performance and allocating resources. Based on these factors, the Company determined that it operates and manages its business as two operating segments: i) Engine Services and ii) Component Repair Services and, accordingly, has two reportable segments for financial reporting purposes. Translation of foreign currencies The functional currency of the Company and its subsidiaries is the U.S. Dollar as revenues, expenses, cash flows, financing and intra-entity transactions are in U.S. Dollars, and the reporting currency of the Company is the U.S. Dollar. Management periodically assesses the functional currency of each subsidiary in accordance with Accounting Standards Codification (“ASC”) 830, “Foreign Currency Matters”. 81 Prior to November 2024, the Company’s Ireland subsidiary’s, SA Component Services (Ireland) Limited, functional currency was the Euro. The Company re-assessed SA Component Services (Ireland) Limited’s functional currency and determined that as of October 31, 2024, the subsidiary’s functional currency changed from the Euro to the U.S. dollar based on Management's analysis of changes in the increased operations in U.S. Dollar. The impact associated with this change was not material. Transactions in currencies other than the functional currency are recorded at the exchange rate prevailing on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are remeasured in the functional currency at the exchange rates in effect as of the consolidated balance sheet dates. Non-monetary assets and liabilities denominated in foreign currencies are measured in the functional currency at the exchange rate in effect at the date of the transaction. All gains and losses from the remeasurement of assets and liabilities denominated in currencies other than the respective functional currency are included in the Consolidated Statements of Operations. Translation of functional currencies to reporting currency for assets and liabilities is recorded using the exchange rates at each balance sheet date, revenue and expenses are translated at average rates prevailing during the reporting period or at the date of the transaction, stockholders’ equity is translated at historical rates. Adjustments resulting from translating functional currency into reporting currency are recorded as a separate component of Accumulated Other Comprehensive Income (Loss) in the Consolidated Statements of Stockholders' Equity. The functional currency for all subsidiaries is the U.S. Dollar. Business combinations Business combinations are accounted for using the acquisition method of accounting, in accordance with ASC 805, Business Combinations. The acquisition method requires identifiable assets acquired and liabilities assumed to be recognized and measured, with limited exceptions, at fair value on the acquisition date, the date the acquirer obtains control of the acquired business. The amount by which the purchase price paid exceeds the net fair value of assets acquired and liabilities assumed is recorded as goodwill. The determination of estimated fair values requires judgment and involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, and asset lives, among other items. The fair values presented are subject to adjustments during a measurement period of up to one year from the acquisition date. The measurement period provides the Company with the ability to adjust the fair values of acquired assets for new information that is obtained about circumstances that existed as of the acquisition date. Transactions costs associated with business combinations are expensed as they are incurred. Use of accounting estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Estimates are used when accounting for the allowance for expected credit losses, slow moving or obsolete inventory, recognizing revenue over time, the accounting for engine utilization contracts, establishment of useful lives for long-lived assets and impairment of goodwill and other long-lived assets, purchase price accounting related to business acquisitions, employee benefit plans, stock-based compensation, income taxes, provisions for losses on contracts, warranty reserves, insurance claims and other contingencies, among others. The Company evaluates and updates its assumptions and estimates on an ongoing basis. Actual results could differ from those estimates. The relevant assumptions and estimates used by the Company are described within the accounting policies disclosed within this note. 82 Revenue recognition The Company has three significant types of maintenance contracts with customers: fixed price contracts, time and material contracts and engine utilization contracts. The performance obligations in a contract can include: (i) repair services and parts/modules embodied and (ii) engine rental revenue. Most of the Company's arrangements with customers create a single performance obligation as the promise to transfer the individual manufactured product or service is capable of being distinct. The Company has customer contracts that are started and completed within the same year, as well as contracts derived from long-term agreements and programs that can span several years. The Company holds long-term agreements with many of its major customers which define specific program requirements. Purchase orders (or authorizations to proceed) are issued under these agreements to reflect presently enforceable rights and obligations for the services being purchased. The units for accounting purposes (“accounting contract”) are typically determined by the purchase order. Management considers a number of factors when determining the existence of an accounting contract and the related performance obligations that include, but are not limited to, the nature and substance of the business exchange, the contractual terms and conditions, the promised products and services, the termination provisions in the contract, presently enforceable rights and obligations of the parties to the contract, whether the promised products and services are distinct or capable of being distinct within the context of the contract, as well as how and when products and services are transferred to the customer. Changes in estimates of revenue, cost of revenue, and the related impact on operating profit are recognized prospectively. The majority of the Company’s accounting contracts have a single performance obligation as the promise is to provide services to maintain, repair or overhaul an engine. The transaction price of a contract reflects the consideration the Company expects to receive for fully satisfying the performance obligation in the contract. The Company typically provides warranties on all services to provide assurance to the customers that the services meet the specifications in the contract. Generally, warranties are not priced separately because customers cannot purchase them independently of the services under contract, so they do not create performance obligations. Provisions for estimated expenses are accrued at the time of sale and are recorded as cost of revenue. Fixed price and time and material contracts Revenue is recognized as control of promised products or services transfer to a customer and is recognized in an amount that reflects the consideration that the Company expects to receive in exchange for those products or services. Revenue is recognized over time as work progresses, as the services performed by the Company enhance customer-controlled assets. As performance obligations are satisfied over time, the Company recognizes revenue using an input method with revenue amounts being recognized proportionately as costs are incurred relative to total expected costs to satisfy the performance obligation. The Company believes that costs incurred are an appropriate measure of progress towards satisfaction of the performance obligation since this measure reasonably depicts the progress of the work effort. To determine the revenue recognized at each period end for contracts in progress, the Company has elected to use a portfolio approach by applying an estimated margin by engine platform to the contract costs incurred. The estimated margin by engine platform is based on average historical margins on similar completed contracts. Judgment is required when determining the estimated margin by engine platform, which includes evaluating the appropriateness of using average historical margins by engine platform for completed contracts on similar contracts in progress. The Company’s fixed price and time and material contracts with customers generally require payment under normal commercial terms after delivery. Payment terms are typically within 30 to 120 days of delivery. Engine Utilization Contracts Engine utilization contracts are agreements in which the Company will provide a stand ready service of scheduled and unscheduled maintenance events. Revenue is recognized over time using an input method with revenue amounts being recognized proportionately as costs are incurred relative to total expected costs to satisfy the performance obligation. The Company identifies and estimates the variable consideration of the total contract revenue and costs of the engine utilization contract. The estimates used are based on the Company’s expected value with respect to the customer’s utilization of engines during the contract and only recognized to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable 83 consideration is subsequently resolved. As a result, such estimates may be materially impacted by changes in the customer’s engine utilization including, as a result of general economic slowdowns, fleet retirements and changes in the customer’s agreements. As a significant change in one or more of these estimates could affect the profitability of a contract, estimates are reviewed and updated on a quarterly basis. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. The Company’s engine utilization contracts with customers generally require monthly payments under normal commercial terms based on flight hours. The timing of satisfaction of performance obligations and actual receipt of payment from a customer may differ and affect the balance of contract assets and contract liabilities. The Company’s current contracts do not include any significant financing components as the timing of the transfer of the underlying products and services under contract are at the customer’s discretion. For contracts that are deemed to be loss contracts, the Company establishes forward loss reserves for total estimated costs that are in excess of total estimated consideration in the period in which they become known. These reserves are based on estimates for accounting contracts. Engine rental The Company owns rental engines which it leases to satisfy customers' short-term requirements. The leases are classified as operating and variable lease payments are recognized as revenue based on the hours flown multiplied by the appropriate hourly rate. The leases are renewable with fixed terms, which generally vary from one to twelve months. Included in cost of revenue is rental engine depreciation of $ 1.6 million , $ 1.8 million and $ 2.5 million for the years ended December 31, 2025, 2024 and 2023 , respectively. Contract assets and contract liabilities Contract assets primarily represent revenues recognized for performance obligations that have been satisfied but for which amounts have not been billed. Current contract assets are those for which performance obligations are expected to be fully satisfied within 12 months of contract origination. Contract liabilities represents advance payments and billings in excess of revenue recognized. These amounts are recorded as contract liabilities until such performance obligations are satisfied, either over time as costs are incurred or at a point in time when deliveries are made. Contract assets and contract liabilities are determined on a contract-by-contract basis. Cash The Company's cash position represents cash held in bank accounts. These assets are generally available to the Company on a daily basis and are highly liquid in nature. Accounts receivable Accounts receivable consist of billed and unbilled accounts receivable and are stated net of an allowance for expected credit losses. The Company maintains an allowance for expected credit losses to reflect the expected uncollectible amounts of accounts receivable based on past collection history and specific risks identified. In determining the required allowance, the Company considers factors such as general and industry-specific economic conditions, customer credit history, and customers’ current and expected future financial performance. The majority of customers are recurring customers with an established payment history. Certain customers are required to undergo extensive credit checks prior to delivery of products or services. Regular evaluations of customer payment experience, current financial condition, and risk analysis are performed. The Company may require collateral in the form of security interest in assets or letters of credit for transactions executed on other than normal trade terms. The allowance for expected credit loss provision is recorded as an element of selling, general and administrative expenses. Accounts receivable together with the associated allowance are written off when there is no realistic prospect of future recovery and all collateral has been realized or transferred to the Company. If, in a subsequent year, the write-off is recovered, the recovery is recognized in the Consolidated Statements of Operations. Revenues that have been recognized, but not invoiced represent unbilled accounts receivable included in accounts receivable, net on our Consolidated Balance Sheets. 84 Inventories Inventories are recorded at the lower of cost and net realizable value with cost being determined on a first-in first-out basis. Costs include materials, direct labor, and an allocation of overhead in the case of work in process. The Company writes down its inventories for estimated obsolescence or unmarketable inventory on a part-by-part basis using aging profiles. Aging profiles are determined based upon assumptions about future demand and market conditions. If actual future demand or market conditions are less favorable than those projected, inventory adjustments may be required. Should future demand or market conditions prove to be different than the estimates, the Company’s cost of revenue may increase. Property, plant and equipment Property, plant and equipment are recorded at cost less accumulated depreciation, which includes costs for significant improvements as well as those that increase the useful lives of existing assets. The cost of routine maintenance, repairs and minor renewals is expensed as incurred. When property, plant and equipment are retired or sold, the net carrying amount is eliminated and any gain or loss on disposition is recognized in the Consolidated Statements of Operations for the respective period. Depreciation is provided over the estimated useful lives of the assets or for leased assets, the lesser of this and the terms of the lease, using the straight-line method, as summarized below. Buildings 5 to 40 years Computer equipment and software 1 to 3 years Machinery and equipment 3 to 20 years Leasehold improvements Shorter of the economic life or term of the lease – 1 to 22 years Rental engines Based on hours flown Land Not depreciated Leases The Company’s lease arrangements primarily pertain to production facilities, office buildings, land, equipment and vehicles. Contractual agreements which provide control over the use of an asset are evaluated to determine if the agreement is, or contains, a lease at its inception date. The Company evaluates the likelihood of exercising of lease renewal options and includes those in the lease term that are considered reasonably certain. The lease is classified as an operating or finance lease using the classification criteria set forth in ASC 842. The Company recognizes a right of use asset and corresponding lease liability based on the present value of lease payments over the lease term. The net lease payments are discounted using the Company’s incremental borrowing rate at lease commencement considering credit risk, the lease term, and other available information as of the commencement date if the rate cannot be readily determined in the lease agreement. Variable lease payments that depend on an index or rate are included in the calculation of operating right-of-use assets and lease liabilities using the index or rate at the lease commencement date. Future differences between the variable lease payments based on an index or rate at the lease commencement date and a subsequent date, or other variable lease payments that do not depend on an index or rate, are recorded as lease expense as they occur. The Company expenses non-lease components and leases with terms of twelve months or less as incurred. The Company’s leases do not contain any material residual value guarantees or restrictive covenants. The Company has an immaterial amount of sublease arrangements where they account for the lessee and lessor component respectively. Right of use assets which qualify as a finance lease are capitalized and included within property, plant and equipment and depreciated over the economic life of the asset or the lease term, whichever is shorter. Interest is charged to the Consolidated Statements of Operations over the period of the lease using a constant interest rate. Depreciation of finance leases is included in the depreciation of the applicable property, plant and equipment category. Right of use assets which qualify as an operating lease are recorded as an “Operating lease right-of-use asset” and an “Operating lease liability” on the Consolidated Balance Sheets and are expensed on a straight-line basis over the life of the agreement to the Consolidated Statements of Operations. Intangible assets Intangible assets comprise of separately acquired intangible assets that are initially recognized at cost and intangible assets acquired in a business combination that are recognized at their fair value at acquisition date. Fees paid for 85 Original Equipment Manufacturers (“OEM”) authorizations and licenses are capitalized and amortized on a straight-line basis over the life of the contract. Customer relationships, Technology and Trademark intangible assets are amortized on a straight-line basis over their estimated useful lives. Amortizable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The amortization periods for the Company’s intangible assets are summarized below: Customer relationships 10 to 25 years OEM authorizations and licenses 3 to 30 years Technology and other 10 to 15 years Trademarks 15 years Long-lived assets The Company reviews its long-lived assets for possible impairment on an annual basis or when events or circumstances indicate that the carrying value of the asset group may not be recoverable. Long lived assets include property, plant and equipment, certain intangible assets, and right of use assets. Assumptions and estimates used in the evaluation of impairment may affect the carrying value of long-lived assets, which could result in impairment charges. If the total of the undiscounted future cash flows is less than the carrying amount of the asset group, an impairment loss, if any, is recognized as the difference between the estimated fair value and the carrying value of the asset group. There was no impairment of lo ng-lived assets for the years ended December 31, 2025, 2024 and 2023. Goodwill Goodwill represents the excess of the purchase price and related costs over the value assigned to net tangible and identifiable assets of businesses acquired and accounted for under the purchase method. Goodwill is not amortized but is subject to impairment testing. Impairment testing is performed annually or when there is indication that a triggering event has occurred, such as an operating loss or a significant adverse change in the Company’s business. The Company has elected to perform its annual impairment testing as of October 1 of each year. For goodwill impairment testing, the Company has the option to first perform a qualitative assessment to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value is less than its carrying amount. If the Company determines that it is not more likely than not, no additional test is required. However, if the Company concludes otherwise or elects not to perform the qualitative assessment then a quantitative impairment test is performed by comparing the fair value of the reporting unit with its carrying value, including goodwill. Projections used in impairment testing include the use of future cash flow and operating projections, which by their nature, are subjective. If the Company determines that the carrying value exceeds the fair value, an impairment to goodwill is recognized equal to the excess and limited to the total amount of goodwill allocated to the reporting unit, as a charge in the Consolidated Statements of Operations. While performing the qualitative test, we consider factors including, but not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments, entity specific factors such as strategy and changes in key personnel, and overall financial performance. If, after completing this assessment, it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a quantitative impairment test. When performing the quantitative impairment test, we compare the fair value of each of our reporting units to its carrying value to determine potential impairment and an impairment loss is recognized in the amount by which the carrying value of a reporting unit’s goodwill exceeds its fair value. The fair values of our reporting units are determined using a weighted average of a market approach and an income approach. The market approach estimates the value of reporting units by comparing them to guideline public companies and guideline transactions. Various valuation multiples are calculated utilizing financial data of companies that are economically and operationally similar resulting in ranges of multiples. Judgmental adjustments are often necessary to ensure comparability. The selection of the appropriate multiple within a range requires judgment, considering various qualitative and quantitative factors. Changes in assumptions or estimates could materially affect the estimated fair value of our reporting units and the potential for impairment. 86 Based on the annual goodwill impairment tests for 2025, 2024 and 2023, we determined there was no impairment of our goodwill. Income taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets are reduced by a valuation allowance to record the deferred tax assets at an amount expected to, more likely than not, be recoverable. Deferred tax assets and liabilities are estimated using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company does not provide taxes on undistributed earnings of foreign subsidiaries that are considered to be permanently reinvested. A portion of the tax impact of these undistributed earnings has been included in the current income tax provision of the consolidated financial statements to date due to the U.S. Global Intangible Low Tax Income (“GILTI”) rules created under the Tax Cuts and Jobs Act of 2017. The undistributed earnings as of January 1, 2018, were subject to the one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings under the Tax Cuts and Jobs Act of 2017. The Company uses a comprehensive model to recognize, measure, present and disclose in its consolidated financial statements uncertain tax positions that the Company has taken or expects to take on a tax return (including a decision on whether to file a return in a particular jurisdiction). The consolidated financial statements will reflect expected future tax consequences of such positions presuming the taxing authorities’ full knowledge of the position and all relevant facts, but without considering time values. Pension The Company contributes to a number of defined contribution pension plans. The Company also contributes to defined benefit plans in France and the United Kingdom. Pension expense on the defined benefit plans are based on management’s assumptions and consists of: the actuarially computed costs of pension benefits in respect of the current years' service; expected return on plan assets and imputed interest on pension obligations; and amortization of experience gains and losses, assumption changes and plan amendments over the expected average remaining service life of the employees group. In addition, the Company is required to recognize as a component of other comprehensive income (loss) the actuarial gains and losses and the prior service costs and credits that arise during the year, but which are not immediately recognized as components of net periodic benefit costs. The amortization of actuarial gains and losses is determined by using a 10 % corridor of the greater of the market value of assets or the accumulated postretirement benefit obligation. Total unamortized gains and losses in excess of the corridor are amortized over the average remaining future service. The funded status of the defined benefit pension plan is recognized as an asset or liability in the consolidated financial statements. Warranty costs The Company provides reserves to account for estimated costs associated with current and future warranty claims. Warranty claims arise when a product the Company services fails to perform to required specifications during the relevant warranty period. The warranty reserve is provided for by increasing cost of revenue by an estimate based on current and historical warranty claims and associated repair costs. Stock-based compensation The Company accounts for share-based compensation expense for awards to employees and directors at the estimated fair value on the grant date, in accordance with ASC 718, Compensation—Stock Compensation. The Company recognizes the estimated fair value of share-based awards as compensation expense on a ratable basis over the requisite service period of the award. For restricted stock units that include a performance condition, compensation cost is recorded based on expected attainment of performance targets. The Company accounts for forfeitures as they occur for all share-based awards. 87 Government grants Government grants are recognized when there is reasonable assurance that the grant will be received, and all conditions will be complied with. The grant is recognized over the periods necessary to match the grant on a systematic basis to the costs that it is intended to compensate. Financial instruments Financial assets and liabilities are recorded on the Consolidated Balance Sheets when the Company becomes a party to the financial instrument. The Company classifies its financial assets and liabilities as (i) measured subsequently at fair value, either through profit and loss or through other comprehensive income (loss), and (ii) measured at amortized cost. The classification of the financial asset or liability is dependent on the business model and the nature of the cash flows associated with the financial asset or liability. The Company will only change the classification of financial assets when the model for managing those financial assets has changed. The Company’s financial instruments include cash, accounts receivable, accounts payable, accrued interest, due to and advances to related parties, long-term debt consisting of Term Loans, recorded at amortized cost. Interest rate swaps, interest rate caps, and foreign exchange contracts are accounted for as cash flow hedges. Concentration of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of accounts receivable and cash. The Company has assessed the credit risk and believes that the concentration of credit risk associated with accounts receivable is minimal because it has significant revenues from well-established customers. Cash is invested in bank deposit accounts and is generally available to the Company on a daily basis. The risk associated with the Company’s cash is mitigated by the fact that these amounts are placed with commercial financial institutions. The Company only enters into derivatives with major financial institutions. The Company could be exposed to loss in the event of non-performance by the counterparty. However, credit ratings and concentration of risk of the financial institution are monitored on a continuing basis and present no significant credit risk to the Company. Fair value of financial instruments The carrying amounts of cash, accounts receivable, accounts payable, accrued interest and advances to and due to related parties, approximate their fair value due to the short-term maturity of these financial instruments. The fair values of the Term Loans, interest rate swaps, interest rate caps and foreign exchange contracts are based on observable market information. Derivative financial instruments The Company uses derivative financial instruments primarily to reduce its exposure to adverse fluctuations in interest rates and foreign exchange. When entered into, the Company formally designates and documents the financial instrument as a hedge of a specific underlying exposure, as well as the risk management objectives and strategies for undertaking the hedge transactions. The Company formally assesses both at the inception and at least quarterly thereafter, whether the financial instruments that are used in hedging transactions are effective at offsetting changes in either the fair value or cash flows of the related underlying exposure. The Company is required to recognize all derivative instruments as either assets or liabilities in the Consolidated Balance Sheets at fair value. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of an effective hedging relationship and, further, on the type of hedging relationship. At the inception of the hedging relationship, the Company must designate the derivative instrument as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. This designation is based upon the exposure being hedged. 88 For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income (Loss) and subsequently reclassified to Interest Expense as interest payments are made on the Company’s variable-rate debt. For derivatives designated and that qualify as cash flow hedges of foreign exchange risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income (Loss) and subsequently reclassified to Selling, General and Administrative Expenses as foreign exchange trades are made. For derivatives that do not qualify for hedge accounting, changes in the fair value of derivative instruments are recorded in the Consolidated Statements of Operations. The Company has established strict counterparty credit guidelines and enters into transactions only with financial institutions of investment grade or better. The Company has elected to apply the hedge accounting expedients, issued under ASU 2020-04 Reference Rate Reform, related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. Deferred finance charges The Company incurs finance charges in connection with the loan agreements. Certain costs associated with these arrangements were deferred and amortized using the straight-line method over the respective term of the debt. Unamortized deferred finance charges relating to the New 2024 Revolving Credit Facility as of December 31, 2025, are included in other long-term assets. Deferred charges relating to the Company's outstanding term debt facilities are reported on the Consolidated Balance Sheets as a direct deduction from long-term debt. To the extent that debt is extinguished before its scheduled maturity date, associated deferred financing charges are expensed immediately in proportion to the amount of the debt extinguishment. Insurance and other reserves The Company maintains insurance for product liability, casualty, property, cybersecurity, business interruption and health claims. Most of the Company’s insurance arrangements include a level of self-insurance. Reserves are established based on the use of current trends and historical data for other claims. These estimates are based on historical information along with certain assumptions about future events. Legal costs Costs associated with the Company’s involvement in legal proceedings are expensed as incurred. Earnings (loss) per share Basic earnings (loss) per share attributable to stockholders is calculated by dividing the net income (loss) attributable to stockholders by the weighted average shares of common stock that were outstanding during the period without consideration of potentially dilutive common stock. Diluted earnings (loss) per share attributable to stockholders reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company unless inclusion of such shares would be anti-dilutive. For periods in which the Company reports net losses, the calculation of diluted net loss per share gives effect to common stock equivalents; however, potential shares of common stock are excluded if their effect is anti-dilutive. The Company reported a net loss for the year ended December 31, 2023 , therefore basic loss per share attributable to stockholders is the same as diluted net loss per share attributable to stockholders for the year ended December 31, 2023. 89 Recent Accounting Pronouncements Accounting Standards Adopted in the Current Year In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance the transparency and decision usefulness of income tax disclosures primarily related to the tax rate reconciliation and income taxes paid information. We adopted this standard for the annual period ending December 31, 2025 on a prospective basis. The adoption of the standard did not affect the Company's Consolidated Statement of Operations, Balance Sheet, and Cash Flows. Recently Issued Accounting Pronouncements - Not Yet Adopted In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements , which clarifies the guidance in Topic 270 to improve the consistency of interim financial reporting. The ASU provides a comprehensive list of required interim disclosures and introduces a disclosure principle requiring entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The standard is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impacts of adopting this guidance on the Company's Consolidated Financial Statements and disclosures. In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities . This update establishes authoritative guidance on the accounting for government grants received by business entities. The standard is effective for our annual and interim reporting periods beginning in 2029, with early adoption permitted. The standard may be applied using a modified prospective, modified retrospective or full retrospective transition approach. The Company is currently evaluating the impacts of this guidance on the Company's Consolidated Financial Statements and disclosures. In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements that better aligns the hedge accounting model with risk management activities. The standard is effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the impacts of this guidance on the Company's Consolidated Financial Statements and disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software . This amendment modernizes the accounting guidance of how software is developed by eliminating project stages from capitalization criteria. The standard is effective for annual reporting periods beginning after December 15, 2027 and interim periods within those annual reporting periods. The standard allows for prospective, modified, or retrospective transition. Early adoption is permitted. The Company is currently evaluating the impacts of this guidance on the Company's Consolidated Financial Statements and disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosures of certain amounts included in the expense captions presented on the Statement of Operations as well as disclosures about selling expenses. The standard is effective on a prospective basis, with the option for retrospective application, for annual periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impacts of this guidance on the Company's Consolidated Financial Statements and disclosures. Other new pronouncements issued but not effective until after December 31, 2025 are not expected to have a material impact on our results of operations, financial condition, or liquidity. 90 NOTE 3: REVENUE RECOGNITION Disaggregated revenue The following table summarizes total revenue by the Company’s segments: Year ended December 31, 2025 2024 2023 (in thousands) Revenue: Engine Services $ 5,353,953 $ 4,644,739 $ 4,049,868 Component Repair Services 708,560 592,422 513,416 Total revenue $ 6,062,513 $ 5,237,161 $ 4,563,284 The following table presents revenues from customers that contributed to more than 10% of revenues: Year ended December 31, 2025 2024 2023 Customer A 13.8 % 21.8 % 24.7 % The following table presents revenues from external customers by end market: Year ended December 31, 2025 2024 2023 (in thousands) Commercial Aerospace $ 3,607,269 $ 3,066,463 $ 2,460,624 Military & Helicopter 1,065,011 973,813 968,136 Business Aviation 1,173,575 1,046,914 968,965 Other 216,658 149,971 165,559 $ 6,062,513 $ 5,237,161 $ 4,563,284 Contract assets and liabilities Contract assets reflect revenue recognized and performance obligations satisfied in advance of customer billing or reimbursable costs related to a specific contract. Contract liabilities relate to payments received in advance of the satisfaction of performance under the contract. The Company receives payments from customers based on the terms established in the Company’s contracts. The following table provides information about contract assets and contract liabilities from contracts with customers: As of December 31, 2025 2024 2023 (in thousands) Contract assets $ 1,072,222 $ 915,940 $ 811,113 Less: allowance for credit loss ( 519 ) ( 740 ) ( 700 ) Contract assets, net $ 1,071,703 $ 915,200 $ 810,413 Contract liabilities $ 411,321 $ 400,025 $ 355,651 Changes in contract assets and contract liabilities primarily result from the timing difference between the Company’s performance of services and payments from customers. The Company recognized revenue that was included in the beginning of period contract liability balance of approximately $ 400.0 million, $ 355.7 million and $ 210.01 million for the years ended December 31, 2025, 202 4 and 2023 respectively. 91 Remaining performance obligations As of December 31, 2025, the Company had approximately $ 465.6 million of remaining performance obligations , which primarily relate to the Company’s engine utilization contracts that are satisfied over multiple years. Of this amount, the Company expects approximately 47 % to be satisfied over the next two years and the remainder thereafter. The expected timing of the satisfaction of performance obligations is dependent on the timing of the customer’s maintenance requirements and as such, the timing of the revenue recognition is subject to estimation uncertainty. The Company excludes from its remaining performance obligation balance the value of remaining performance obligations for its fixed price and time & material contracts, as the performance obligations for these contracts generally have an original expected duration of one year or less. Rental Engine Revenue Revenue from rental engines was $ 85.9 million, $ 83.6 million and $ 81.4 million for the years ended December 31, 2025, 2024 and 2023 respectively. NOTE 4: EARNINGS (LOSS) PER SHARE As a result of the 103-for-one stock split and the Restructuring Transactions in 2024, the 281,211,630 shares of the Company’s Co mmon Stock held were distributed to former holders of Class A-1 Units and Class A-2 Units of Dynasty Parent Holdings, L.P. in an aggregate of 275,053,375 shares of Common Stock (of which 8,157 were restricted shares at the time of distribution), and also to holders of Class B Units of Dynasty Parent Holdings, L.P. in an aggregate of 6,158,255 shares of Common Stock (of which 6,028,394 were restricted shares at the time of distribution). For purposes of the computation of earnings (loss) per share this distribution represented a net 100.79-for-one stock split of the Company’s Common Stock which is retroactively adjusted for all periods presented. The following table summarizes the computation of basic and diluted net income per share attributable to the stockholders: Year ended December 31, 2025 2024 2023 (in thousands, except per share amounts) Numerator for earnings per share: Net income (loss) $ 277,417 $ 10,974 $ ( 35,061 ) Denominator for earnings per share: Weighted average shares of common stock - basic 328,448 288,415 275,175 Dilutive effect of stock options and restricted stock awards 5,873 1,384 — Weighted average shares - diluted 334,321 289,799 275,175 Earnings (loss) per share: Basic earnings (loss) per share $ 0.84 $ 0.04 $ ( 0.13 ) Diluted earnings (loss) per share $ 0.83 $ 0.04 $ ( 0.13 ) The Company has 5,840,568 contingently issuable shares of Common Stock that are issuable upon the Company’s completion of a liquidity event, which has not occurred as of December 31, 2025. These shares are excluded from weighted average shares of common stock - basic, but included in the calculation of the dilutive effect of stock options and restricted stock awards. Anti-dilutive shares of 0.5 million for the year ended December 31, 2025, were excluded from the calculation of the dilutive effect of stock options and restricted stock awards. See Note 19, Stock Based Compensation for further information. 92 NOTE 5: ACQUISITIONS Aero Turbine, Inc. On Aug ust 23, 2024 , the Company acquired 100 % of the shares of Aero Turbine, Inc. (“Aero Turbine”) for a purchase price of approximately $ 130.7 million subj ect to post-closing adjustments, comprised of an initial cash purchase price of $ 116.8 million and $ 15.2 million representing the estimated fair value of additional consideration contingently payable based upon the achievement of gross profit in excess of certain gross profit targets for the period from January 1, 2024, to December 31, 2026. During the year ended December 31, 2025, the Company received an additional cash payment of $ 1.3 million related to a post-closing purchase price adjustment related to working capital. The Company recorded this measurement period adjustment as a $ 1.3 million decrease to goodwill, resulting in a corresponding $ 1.3 million decrease of the initial purchase price of $ 132.0 million. The maximum contingent consideration payable from the Company to the seller is $ 21.0 million. The current portion of the contingent consideration liability is recorded in Accrued and other current liabilities and the non-current portion is recorded in Other non-current liabilities. Aero Turbine is a provider of engine component repair, overhaul services and other engineering services for U.S. and foreign military customers. The results of operations of Aero Turbine have been included in the consolidated financial statements of the Company from August 23, 2024, the closing date of the acquisition. Aero Turbine is reported within the Component Repair Services segment. The Company has allocated the purchase price based on the fair values of the assets acquired and liabilities assumed at the Aero Turbine acquisition date as follows: Amounts acquired on August 23, 2024 (as adjusted) (in thousands) Cash $ 2,765 Accounts receivable 4,066 Contract assets 12,419 Inventories 10,213 Prepaid expenses and other current assets 2,518 Property, plant and equipment 5,868 Operating lease right of use asset 999 Customer relationships 75,000 Goodwill 51,723 Total assets acquired 165,571 Accounts payable 5,353 Accrued and other current liabilities 7,131 Contract liabilities 1,205 Current portion operating lease liabilities 111 Income taxes payable 4,901 Long-term portion operating lease liabilities 899 Deferred income tax liabilities 15,269 Total liabilities assumed 34,869 Net assets acquired 130,702 Cash acquired 2,765 Purchase price, net of cash acquired $ 127,937 The fair value s presented were estimated by management. During the year ended December 31, 2025, the Company recorded measurement period adjustments due to a post-closing working capital adjustment resulting in a $ 1.3 million 93 decrease in purchase price, and estimate refinements of a $ 0.8 million decrease in accrued and other current liabilities and $ 0.4 million increase in deferred income tax liabilities, resulting in a $ 1.7 million decrease to goodwill. The fair value of the assets acquired includes accounts receivable of $ 4.1 million, of which all is expected to be collectible. The excess of the cost of acquisition over the fair value of the net tangible assets acquired of $ 126.7 million has been allocated as $ 75.0 million of customer relationships and $ 51.7 million of goodwill. The goodwill recognized is attributable to Aero Turbine’s workforce, market position, quality, customized repairs and reliable turnaround times. Goodwill will not be amortized but will be reviewed annually for impairment. None of the goodwill is expected to be deductible for income tax purposes. Customer relationships are expected to be amortized over 15 years. Acquisition related costs of $ 1.4 million were incurred for the year ended December 31, 2024. These costs are reported in the Consolidated Statements of Operations as “Acquisition costs”. Such expenses include professional fees and other third-party costs. The following reflects the pro forma impact of the purchase of Aero Turbine on the Company’s results of operations giving effect to the transaction if it had taken place on January 1, 2023: Year ended December 31, 2024 2023 (in thousands) Revenue $ 5,295,976 $ 4,625,301 Net income (loss) 26,273 ( 26,699 ) Western Jet Aviation On February 2, 2023 , the Company acquired 100 % of the shares of Western Jet Aviation, Inc. (“Western Jet”) for a purchase price of approximately $ 32.7 million. Western Jet is a certified repair station for business jet maintenance, specializing in Gulfstream aircraft, offering maintenance and interior services, plus heavy avionics support on many business aviation aircraft. The results of operations of Western Jet have been included in the consolidated financial statements of the Company from February 2, 2023, the closing date of the acquisition. For the year ended December 31, 2023, results of operations included $ 34.6 million in revenues and $ 1.8 million in net income, respective ly. Western Jet is reported within the Engine Services segment. 94 The Company allocated the purchase price based on the fair values of the assets acquired and liabilities assumed at the Western Jet acquisition date as follows: February 2, 2023 (in thousands) Cash $ 1,379 Accounts receivable 7,022 Contract assets 4,485 Inventories 2,543 Prepaid expenses and other current assets 987 Property, plant and equipment 2,843 Operating lease right of use asset 9,013 Intangible assets 447 Goodwill 23,493 Deferred income taxes 2,812 Total assets acquired 55,024 Accounts payable 1,845 Accrued and other current liabilities 3,254 Contract liabilities 8,220 Current portion operating lease liabilities 1,072 Long-term portion operating lease liabilities 7,941 Total liabilities assumed 22,332 Net assets acquired 32,692 Cash acquired 1,379 Purchase price, net of cash acquired $ 31,313 The fair values presented were estimated by management. The fair value of the assets acquired included accounts receivable of $ 7.0 million, the gross amount due under contracts is $ 7.1 million, of which $ 0.1 million was expected to be uncollectible. The excess of the cost of acquisition over the fair value of the net tangible assets acquired of $ 23.5 million has been allocated to goodwill. The goodwill recognized is attributable to Western Jet’s market position, quality, customized repairs and reliable turnaround times. Goodwill will not be amortized but will be reviewed annually for impairment. None of the goodwill is expected to be deductible for income tax purposes. Acquisition related costs of $ 1.5 million were incurred for the year ended December 31, 2023. These costs are reported in the Consolidated Statements of Operations as “Acquisition costs”. Such expenses include professional fees and other third-party costs. The following reflects the pro forma impact of the purchase of Western Jet on the Company’s results of operations giving effect of the transaction if it had taken place on January 1, 2022: Year ended December 31, 2023 2022 (in thousands) (Unaudited) Revenue $ 4,566,423 $ 4,185,887 Net loss ( 33,372 ) ( 22,111 ) 95 NOTE 6: ACCOUNTS RECEIVABLE Accounts receivable, net is summarized as follows: As of December 31, 2025 2024 (in thousands) Billed $ 609,189 $ 549,369 Unbilled 58,685 46,754 Total accounts receivable 667,874 596,123 Less: allowance for credit losses ( 13,484 ) ( 15,455 ) Total accounts receivable, net $ 654,390 $ 580,668 A reconciliation of the beginning and ending allowance for credit losses is as follows: As of December 31, 2025 2024 2023 (in thousands) Balance, beginning of the year $ 15,455 $ 14,779 $ 12,889 Provisions 380 1,672 3,201 Write-offs ( 2,351 ) ( 996 ) ( 1,311 ) Balance, end of the year $ 13,484 $ 15,455 $ 14,779 NOTE 7: INVENTORIES Inventories consist of the following: As of December 31, 2025 2024 (in thousands) Raw materials $ 701,091 $ 662,887 Finished goods 2,895 2,529 Work in process 123,705 181,602 Total inventory $ 827,691 $ 847,018 Inventory balances were net of reserves for slow moving, excess or obsolete engine and aircraft parts inventory of $ 127.6 million a nd $ 110.2 million as of December 31, 2025 and 2024, respectively. 96 NOTE 8: PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: As of December 31, 2025 2024 (in thousands) Land $ 49,329 $ 49,329 Buildings 142,406 148,477 Machinery and equipment 488,856 433,113 Leasehold improvements 71,340 68,605 Computer equipment and software 27,101 21,182 Rental engines 207,862 202,070 Total property, plant and equipment, gross 986,894 922,776 Less: accumulated depreciation ( 406,923 ) ( 354,169 ) Property, plant and equipment, net $ 579,971 $ 568,607 The Company’s depreciation expense for all property, plant and equipment, including assets recorded under finance leases, was $ 62.4 million, $ 63.0 million and $ 70.1 million for the years ended December 31, 2025, 2024 and 2023 , respectively. Construction in Progress (“CIP”) assets that are not yet in use, which totaled $ 122.8 million and $ 94.6 million and for the years ended December 31, 2025 and 2024, respectively, are included in machinery and equipment and are not depreciated. Depreciation expense is included within cost of revenue. The Company determined that there was no impairment of the long-lived assets during the years ended December 31, 2025, 2024 and 2023 . NOTE 9: INTANGIBLE ASSETS Intangible assets consist of the following: As of December 31, 2025 Gross Carrying Amount Accumulated Amortization Net Balance Weighted-Average Amortization Period Remaining (in thousands) (in years) Customer relationships $ 1,461,276 $ ( 540,844 ) $ 920,432 12.0 OEM authorizations and licenses 334,297 ( 204,823 ) 129,474 12.4 Trademarks 204,000 ( 91,847 ) 112,153 8.3 Technology and other 9,127 ( 5,877 ) 3,250 5.0 Total intangible assets $ 2,008,700 $ ( 843,391 ) $ 1,165,309 11.6 As of December 31, 2024 Gross Carrying Amount Accumulated Amortization Net Balance Weighted-Average Amortization Period Remaining (in thousands) (in years) Customer relationships $ 1,461,276 $ ( 456,575 ) $ 1,004,701 12.9 OEM authorizations and licenses 334,009 ( 172,487 ) 161,522 11.8 Trademarks 204,000 ( 78,247 ) 125,753 9.3 Technology and other 9,127 ( 4,915 ) 4,212 5.6 Total intangible assets $ 2,008,412 $ ( 712,224 ) $ 1,296,188 12.4 97 The Company’s amortization expense was $ 131.3 million, $ 125.2 million, $ 127.0 million for the years ended December 31, 2025, 2024 and 2023, respectively. Amortization of OEM authorizations and licenses is included within cost of revenue and the remainder is presented separately in the consolidated statement of operations. Estimated amortization expense for each of the five succeeding fiscal years is as follows: Amortization Expense (in thousands) 2026 $ 121,423 2027 111,148 2028 109,589 2029 106,412 2030 105,376 There were no impairment charges recorded for intangible assets for the years ended December 31, 2025, 2024 and 2023 . NOTE 10: GOODWILL The changes in the carrying amount of goodwill for the periods ended December 31, 2025 and 2024, are as follows: Segment Engine Services Component Repair Services Total (in thousands) Balance, December 31, 2023 $ 1,224,707 $ 407,789 $ 1,632,496 Goodwill acquired — 53,474 53,474 Balance, December 31, 2024 1,224,707 461,263 1,685,970 Purchase price adjustments — ( 1,715 ) ( 1,715 ) Balance, December 31, 2025 $ 1,224,707 $ 459,548 $ 1,684,255 Goodwill Impairment Testing The Company reviews goodwill at least annually for potential impairment, as of October 1, and more frequently, if events or changes in circumstances suggest that an impairment may exist. The Company performed its annual goodwill impairment test as of October 1, 2025. Based on the results of this test, the fair values of each of the Company's reporting units exceeded their carrying values. NOTE 11: ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES As of the years ended December 31, 2025 and 2024, accrued expenses and other current liabilities consisted of the following: As of December 31, 2025 2024 (in thousands) Accrued interest $ 221 $ 125 Lease return provision — 15,037 Warranty reserves 11,829 14,620 Current portion of long-term agreements 1,921 1,513 Fair value of cash flow hedge 6,808 8,967 Other accrued expenses 70,720 59,310 Total accrued expenses and other current liabilities $ 91,499 $ 99,572 Warranty reserves 98 Reserves are recorded to reflect the Company’s contractual liabilities relating to warranty commitments to customers. Warranty coverage of various lengths and terms is provided to customers depending on standard offerings and negotiated contractual agreements. Changes in the warranty reserve are summarized and recorded in the Consolidated Balance Sheets within “Accrued expenses and other current liabilities” as follows: As of December 31, 2025 2024 2023 (in thousands) Balance, beginning of the year $ 14,620 $ 13,704 $ 14,233 Accruals for warranties 779 3,396 3,454 Warranty claims settled ( 3,570 ) ( 2,480 ) ( 3,983 ) Balance, end of the year $ 11,829 $ 14,620 $ 13,704 NOTE 12: LONG-TERM DEBT Long-term debt consists of the following: As of December 31, 2025 2024 (in thousands) New 2024 Term Loan Facilities $ 2,227,500 $ 2,250,000 New 2024 Revolving Credit Facility — — Finance leases 18,525 18,375 Other 1,172 1,230 2,247,197 2,269,605 Less: Current portion ( 23,444 ) ( 23,449 ) Unamortized discounts ( 19,170 ) ( 22,456 ) Unamortized deferred finance charges ( 13,422 ) ( 15,723 ) Long-term debt $ 2,191,161 $ 2,207,977 New Credit Agreement On October 31, 2024, the Company entered into the New Credit Agreement providing for the New 2024 Term Loan Facilities due October 31, 2031 , in an aggregate principal amount of $ 2,250.0 million, and the New 2024 Revolving Credit Facility due October 31, 2029 , in an aggregate principal amount of up to $ 750.0 million. Concurrent with the closing of the New Credit Agreement, the Company used the proceeds of the New 2024 Term Loan Facilities and approximately $ 95.0 million of the proceeds of the New 2024 Revolving Credit Facility to repay in full amounts outstanding under (i) the Prior Credit Agreement and (ii) the Prior ABL Credit Agreement, terminating each of the debt facilities thereunder. The Company expensed $ 23.7 million related to new third party fees that did not meet the criteria for deferral as refinancing costs on the Consolidated Statement of Operations during the year ended December 31, 2024, of which $ 5.7 million related to the New Credit Agreement, $ 11.6 million related to the New 2024 Term Loan Facilities, $ 1.5 million related to the September 6, 2024 amendment to the Prior Credit Agreement and $ 4.9 million related to the March 25, 2024 Prior Credit Agreement. New 2024 Term Loan Facilities The New Credit Agreement provided for (i) a senior secured U.S Dollar term B loan facility, incurred by the U.S. Borrower in an aggregate principal amount of $ 1,630.0 million (the “New 2024 Term B-1 Loan Facility”), (ii) a senior secured U.S. Dollar term B loan facility incurred by the Canadian Borrower in an aggregate principal amount of $ 620.0 million (the “New 2024 Term B-2 Loan Facility” and, together with the New 2024 Term B-1 Loan Facility, the “New 2024 Term Loan Facilities”). The New 2024 Term Loan Facilities were fully drawn on December 31, 2024, in an aggregate principal amount of $ 2,250.0 million, bearing interest at a Term Secured Overnight Financing Rate (“SOFR”) + 2.25 % with provision for a rate step-down to 2.00 % based on achieving a consolidated First Lien Net Leverage Ratio (as defined in the New Credit Agreement) of 3.00x or less, and will mature on October 31, 2031. The 99 Company incurred new third party fees of $ 13.2 million related to the New 2024 Term Loan Facilities of which $ 11.6 million were expensed as refinancing costs on the Consolidated Statement of Operations during the year ended December 31, 2024, and $ 1.6 million of deferred finance charges were recorded as a reduction of long-term debt on the Consolidated Balance Sheets as of December 31, 2024 and will be amortized on a straight-line basis over the term of the credit facility. As of December 31, 2025, the effective interest rate on the New 2024 Term Loan Facilities was SOFR + 2.00 % . New 2024 Revolving Credit Facility The New Credit Agreement provided for a senior secured multicurrency revolving credit facility available to the Company in an aggregate principal amount of up to $ 750.0 million (of which up to $ 150.0 million is available for the issuance of letters of credit) (the “New 2024 Revolving Credit Facility” and, together with the New 2024 Term Loan Facilities, the “New Senior Secured Credit Facilities”). The New 2024 Revolving Credit Facility will mature on October 31, 2029. As of December 31, 2025, the New 2024 Revolving Credit Facility had no outstanding borrowings. Borrowings bear interest at SOFR + 2.00 % with provision for a rate step-down to 1.75 % and 1.5 % based on a achieving a consolidated First Lien Net Leverage Ratio of 3.25x or less and 2.75x or less, respectively. As of December 31, 2025, the Company had $ 735.9 million of available borrowing capacity under the New 2024 Revolving Credit Facility. The Company incurred new len der fees of $ 3.8 m illion related to the New 2024 Revolving Credit Facility, which are recorded as an other long-term asset on the Consolidated Balance Sheets as of December 31, 2024, and will be amortized on a straight-line basis over the term of the facility. As of December 31, 2025, the effective interest rate on the New 2024 Revolving Credit Facility w as SOFR + 1.75 % . Prior Credit Agreement On October 31, 2024, concurrent with the closing of the New Credit Agreement, the Company used the proceeds of the New 2024 Term Loan Facilities and the New 2024 Revolving Credit Facility to repay in full amounts outstanding under the Prior Credit Agreement terminating each of the debt facilities thereunder, which resulted in a loss on extinguishment of debt of $ 4.7 million recognized in the year ended December 31, 2024, $ 0.7 million related to the March 25, 2024 amendment of the Prior Credit Agreement, $ 3.6 million upon the commencement of the New Credit Agreement o n October 31, 2024 representing the write off unamortized discounts and deferred financing charges related to the extinguished portions of the Prior Term Loan facilities and $ 0.4 million related to the extinguishment of the Prior 2023 Revolving Credit Facility. Prior 2023 and Prior 2024 Term Loan Facilities On August 24, 2023, the Company amended the Prior Credit Agreement to combine the then-existing term loan facilities into the Prior 2023 Term Loan Facilities in the amount of $ 2,575.0 million less a 1.0 % discount. The Prior 2023 Term Loan Facilities were comprised of two tranches, referred to as the Prior 2023 Term B-1 Loan Facility and the Prior Term B-2 Loan Facility, with identical terms that were entered into by subsidiaries of the Company. The Prior 2023 Term Loan Facilities incurred interest at the Term SOFR Rate plus 3.75 % to 4.00 % or the Base Prime Rate plus 2.75 % to 3.00 % and were scheduled to mature on August 24, 2028 . As a result of the amendment, both a debt modification and a debt extinguishment arose. The Company recognized $ 0.8 million in deferred charges related to the Prior 2023 Term Loan Facilities which are recorded as a reduction of long-term debt on the Consolidated Balance Sheets. The Company also recognized a loss on the extinguishment of debt of $ 6.2 million, representing the write-off of the unamortized deferred finance charges and original issue discount related to the extinguished portion of the then-existing term loan facilities, while $ 22.8 million of the unamortized deferred finance charges and original issue discount relating to the modified debt continued to be deferred. In addition, $ 19.9 million in third party fees related to the modified portion of the then-existing term loan facilities did not meet the criteria for deferral. On March 25, 2024, the Company amended its Prior Credit Agreement, dated as of April 4, 2019, among Dynasty Acquisition Co., Inc. as the U.S. borrower (the “U.S. Borrower”), Standard Aero Limited, as the Canadian borrower (the “Canadian Borrower”), Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent, and certain other parties thereto, to refinance the $ 2,562.1 million existing senior secured term loans then-outstanding thereunder (the “Prior 2023 Term Loans”) and provide the Company with an incremental $ 200.0 million as additional term loans (together with the refinanced 2023 Term Loans, the “Prior 2024 Term Loans” and the facilities in respect thereof, the “Prior 2024 Term Loan Facilities”). In addition, the amendment reduced the applicable interest rate to the 100 Term SOFR Rate plus 3.25 % to 3.50 % or the Base Prime Rate plus 2.25 % to 2.50 %. All other terms of the Prior Credit Agreement remained unchanged. The incremental proceeds from the Prior 2024 Term Loans were used toward the partial redemption of the Prior Senior Notes. As a result of the amendment, the Company recognized a loss on the extinguishment of debt of $ 0.7 million in the year ended December 31, 2024, representing the write-off of the unamortized deferred finance charges related to the extinguished portion of the Prior 2023 Term Loans. In addition, $ 4.9 million in third party fees related to the modified portion of the Term Loans were expensed as refinancing costs on the Consolidated Statement of Operations during the year ended December 31, 2024, as these costs did not meet the criteria for deferral. The Company recognized $ 0.1 million in deferred charges which are recorded as a reduction of long-term debt on the Consolidated Balance Sheets. The original issue discount and deferred charges were amortized over the term of the Prior Credit Agreement using the straight-line method, which approximates the effective interest rate method. On September 6, 2024, the Company amended the Prior Credit Agreement to incur additional 2024 Term Loans in a principal amount of $ 200.0 million which were, in part, used to paydown a portion of the advances under the Company’s Prior ABL Credit Facility used to fund the acquisition of Aero Turbine. There were no other substantive changes made to the Prior Credit Agreement. As a result of the amendment, $ 1.5 million in third party fees related to the modified portion of the Term Loans were expensed as refinancing costs on the Consolidated Statement of Operations during the year ended December 31, 2024, as these costs did not meet the criteria for deferral. The original issue discount and deferred charges were amortized over the term of the Prior Credit Agreement using the straight-line method, which approximates the effective interest rate method. On October 31, 2024 concurrent with the New Credit Agreement, the Company recognized a $ 3.6 million loss on extinguishment of debt representing the write off unamortized discounts and deferred financing charges related to the extinguished portions of the Prior Term Loan facilities. Prior 2023 Revolving Credit Facility The Prior 2023 Revolving Credit Facility was a senior secured multicurrency cash flow revolving credit facility available under the Prior Credit Agreement, with a capacity of $ 150.0 million (of which up to $ 75.0 million was available for the issuance of letters of credit) and was scheduled to mature on May 1, 2028 . The Prior 2023 Revolving Credit Facility bore interest at the Adjusted Term SOFR rate plus 3.125 % to 3.50 %. The applicable rates on borrowing under the credit agreement were based on the Consolidated First Lien Net Leverage Ratio. The 2023 Revolving Credit Facility was subject to a maximum Consolidated First Lien Net Leverage Ratio that was tested at the end of any fiscal quarter if the total revolving credit loans outstanding under the Prior 2023 Revolving Credit Facility on such date exceed 35.0 % of the aggregate amount of all commitments in respect of the Prior 2023 Revolving Credit Facility. On October 31, 2024, concurrent with the closing of the New Credit Agreement, the Company terminated the Prior 2023 Revolving Credit Facility which had no outstanding loans under it, resulting in a loss on extinguishment of debt of $ 0.4 million recognized in the year ended December 31, 2024. Prior ABL Credit Facility On October 31, 2024, concurrent with the closing of the New Credit Agreement, the Company used the proceeds of the New 2024 Term Loan Facilities and the New 2024 Revolving Credit Facility to repay in full amounts outstanding under the Prior ABL Credit Agreement, terminating the debt facility thereunder. The extinguishment of the Prior ABL Credit Facility resulted in a loss on extinguishment of debt of $ 2.0 million recognized in the year ended December 31, 2024. The Prior ABL Credit Facility had a capacity of $ 400.0 million, was repayable in U.S. Dollars and was scheduled to mature on May 1, 2028 . At the Company’s discretion, the borrowings under the Prior ABL Credit Facility bore interest at the Adjusted Term SOFR rate plus 1.50 % to 2.00 %, Prime Lending Rate plus 0.50 % to 1.00 %, or the Base Rate on Canadian borrowings plus 0.50 % to 1.00 %, with the spread dependent on the amount of the borrowing and was subject to certain financial covenants. The Prior ABL Credit Facility had an annual commitment fee of 0.250 % to 0.375 % based on excess availability. The Prior ABL Credit Facility contained financial covenants which were required to be calculated immediately prior to or during the continuance of a trigger period. The trigger period was a period where borrowing availability was less than the greater of 10 % of the line cap and $ 30.0 million. 101 Prior Senior Notes The Prior Senior Notes bore an interest rate of 10.0 % and were scheduled to mature on April 4, 2027 . On March 25, 2024, the Company partially redeemed $ 200.0 million of the Prior Senior Notes. As a result of the redemption, the Company recognized a loss on extinguishment of debt of $ 2.9 million in the year ended December 31, 2024, representing the write-off of the unamortized deferred finance charges related to the redeemed portion of the Prior Senior Notes. On October 3, 2024, the Company used the proceeds from the initial public offering to repay the full outstanding principal and accrued interest on the Prior Senior Notes, totaling $ 487.5 million. The extinguishment of the Prior Senior Notes resulted in a loss on extinguishment of debt of $ 5.7 million recognized in the year ended December 31, 2024. The Company’s weighted average interest rate of borrowings under its senior credit agreements was 6.3 % for the year ended December 31, 2025 and 8.8 % for the year ended December 31, 2024. Certain of these agreements contain non-financial covenants that limit both the Company’s ability to raise additional financings in the future and the Company’s ability to pay dividends subject to select amounts and incurrence ratios. As of December 31, 2025, the amounts of the long-term debt payable for the years ending on December 31 are as follows: Finance Leases Debt Total (in thousands) 2026 $ 1,632 $ 22,667 $ 24,299 2027 1,656 23,504 25,160 2028 1,646 22,500 24,146 2029 1,646 22,500 24,146 2030 1,646 22,500 24,146 Thereafter 20,144 2,115,001 2,135,145 Total $ 28,370 $ 2,228,672 $ 2,257,042 Amount representing interest ( 9,845 ) — ( 9,845 ) Unamortized discounts — ( 19,170 ) ( 19,170 ) Unamortized deferred finance charges — ( 13,422 ) ( 13,422 ) Total long-term debt payable $ 18,525 $ 2,196,080 $ 2,214,605 NOTE 13: LEASES Lease costs consist of the following: Year Ended December 31, 2025 2024 2023 (in thousands) Finance lease expense Amortization $ 1,393 $ 1,392 $ 1,377 Interest expense 953 867 939 Operating lease expense 36,496 31,641 30,311 Short term lease expense 1,832 1,276 1,978 $ 40,674 $ 35,176 $ 34,605 102 The impact of leasing on the Consolidated Balance Sheets consists of the following: Classification on the Year ended December 31, Consolidated Balance Sheets 2025 2024 (in thousands) Assets Finance lease assets Property, plant and equipment, net $ 18,869 $ 20,262 Operating lease assets Operating lease right of use asset, net 222,151 172,206 Total lease assets $ 241,020 $ 192,468 Current liabilities Finance lease liabilities Current portion of long-term debt $ 777 $ 835 Operating lease liabilities Operating lease liabilities 22,308 17,663 Non-current liabilities Finance lease liabilities Long-term debt 17,748 17,540 Operating lease liabilities Long-term operating lease liabilities 212,365 164,224 Total lease liabilities $ 253,198 $ 200,262 Supplemental cash flow information related to leases consisted of the following: Year Ended December 31, 2025 2024 2023 (in thousands) Cash paid for amounts included in measurement of liabilities: Operating cash flows from operating leases $ 35,391 $ 29,863 $ 26,874 Operating cash flows from finance leases 953 867 939 Financing cash flows from finance leases 835 830 807 Right of use assets obtained in exchange for lease liabilities: Operating lease right of use asset 75,486 25,495 4,530 Future minimum operating lease payments consist of the following for the twelve months ending December 31: Operating Leases (in thousands) 2026 $ 35,715 2027 34,647 2028 32,640 2029 28,438 2030 23,691 Thereafter 219,000 Total future minimum payments 374,131 Less imputed interest 139,458 Present value of minimum payments $ 234,673 103 Weighted average remaining lease term and borrowing rate consisted of the following: December 31, 2025 December 31, 2024 Operating Leases Finance Leases Operating Leases Finance Leases Weighted average remaining lease term (in years) 15.6 19.2 16.0 19.5 Weighted average borrowing rate 6.3 % 4.7 % 6.2 % 4.7 % Lessor Arrangements The net carrying amount of equipment leased to others, included in property, plant and equipment, under operating leases as of December 31, 2025 and 2024 were approximately $ 53.3 million and $ 67.5 million respectively. NOTE 14: INCOME TAXES The components of the income tax expense for continuing operations are as follows: Year ended December 31, 2025 2024 2023 (in thousands) Current U.S. Federal $ 51,439 $ 47,923 $ 34,203 State 13,119 6,483 3,130 Foreign 50,362 39,792 22,732 Total current 114,920 94,198 60,065 Deferred U.S. Federal ( 16,872 ) ( 28,241 ) ( 19,459 ) State ( 1,416 ) 3,046 2,221 Foreign 2,803 1,780 ( 2,647 ) Total deferred ( 15,485 ) ( 23,415 ) ( 19,885 ) Income tax expense $ 99,435 $ 70,783 $ 40,180 Income from continuing operations before taxes for U.S. and foreign operations are as follows: Year ended December 31, 2025 2024 2023 (in thousands) Domestic $ 109,866 $ ( 130,387 ) $ ( 105,986 ) Foreign 266,986 212,144 111,105 Income from continuing operations before income taxes $ 376,852 $ 81,757 $ 5,119 Accumulated other comprehensive income at years ended December 31, 2025 and 2024 , has been reported net of a $ 2.4 million deferred tax asset and a $ 3.5 million deferred tax asset, respectively. The Company has the intent and ability to assert that undistributed foreign earnings are indefinitely or “permanently” reinvested outside the U.S. The Company is aware that there may be withholding taxes on an actual distribution of the undistributed foreign earnings. If the undistributed earnings were not considered permanently reinvested, deferred tax liabilities would have been provided for any applicable income taxes and withholding taxes payable in various countries, which would not be significant. A determination of the unrecognized deferred tax liabilities on the other outside basis differences reinvested indefinitely at December 31, 2025, is not practicable due to the complexities in the calculations. 104 The Company adopted ASU 2023-09 "Income Taxes (Topic 740): Improvements To Income Tax Disclosures" on a prospective basis beginning with the year ended December 31, 2025. The following table presents required disclosure pursuant to ASU 2023-09 and reconciles the U.S. federal statutory tax amount and rate to our actual global effective amount and rate for the year ended December 31, 2025: Year ended December 31, 2025 Amount Percent (in thousands) Income tax expense at the U.S. statutory rate, 21 % $ 79,139 21.0 % State taxes, net of federal income tax effects 1 10,901 2.9 % Foreign tax effects: Canada Foreign rate differential ( 6,022 ) ( 1.6 )% Other 808 0.1 % Other foreign jurisdictions 2,312 0.6 % Effect of cross-border tax laws 15,863 4.2 % Changes in UTBs 5,770 1.5 % Changes in valuation allowance 1,214 0.3 % Non-deductible expenses 859 0.2 % Other reconciling items Return to provision adjustments ( 11,048 ) ( 2.9 )% Other, net ( 361 ) ( 0.1 )% Totals $ 99,435 26.4 % (1) ASU 2023-09 requires disclosure of the state and local jurisdictions making up greater than 50% of state tax expense. For 2025, California is the largest component of state tax expense, and exceeds the 50% threshold. The following table presents the required disclosures prior to the Company's adoption of ASU 2023-09 and reconciles the U.S. federal statutory income tax rate to the actual global effective income tax rate for the years ended December 31, 2024 and December 31, 2023: Year ended December 31, 2024 2023 (in thousands) Income tax expense at the U.S. statutory rate, 21 % $ 17,169 $ 1,075 State taxes, net 919 1,175 Effect of foreign tax rates ( 4,093 ) ( 5,325 ) GILTI 13,094 7,919 Effect of change in tax rates 1,636 4,193 Non-taxable income ( 215 ) ( 431 ) Non-deductible expenses 5,991 5,698 Stock based compensation 2,186 — Valuation allowance 22,838 31,854 Tax credits — — Adjustments in respect of prior years 11,122 ( 5,509 ) Other, net 136 ( 469 ) Income tax expense $ 70,783 $ 40,180 The Company has adopted a position of indefinitely reinvesting earnings in its foreign operations. Despite the Company’s position of indefinitely reinvesting earnings in its foreign operations, the Tax Cuts and Jobs Act of 2017 made significant changes to the way U.S. multinationals’ foreign profits are taxed. GILTI was introduced as an outbound anti-base erosion provision. In 2021, the Organization for Economic Cooperation and Development (“OECD”) released Pillar Two Global Anti-Base Erosion model rules (“Pillar Two Rules”), designed to ensure large corporations are taxed at a minimum rate of 105 15 % in all countries of operation. On June 20, 2024, as part of Bill C-69, Canada enacted its Pillar Two legislation effective January 1, 2024. Canada Bill C-59 was also enacted on June 20, 2024, and included the excessive interest and financing expenses limitation (EIFEL) regime effective for tax years beginning on or after December 31, 2023. The Company has performed a quantitative and qualitative assessment and determined the effects are not materially significant to the 2024 and 2025 financial statements. The Company will continue to evaluate Pillar Two and EIFEL for their potential impact on future periods as further legislation is proposed or enacted. On July 4, 2025 the One Big Beautiful Bill Act (the “OBBBA”), which includes a broad range of U.S. tax reform provisions, was signed into law by the President of the United States. The OBBBA includes significant provisions, such as (i) the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, (ii) modifications to the international tax framework, and (iii) the restoration of favorable tax treatment for certain business provisions. The OBBBA has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. For the twelve month period ending December 31, 2025, the impact from the OBBBA provisions did not impact the effective tax rate; however, the OBBBA did have an impact on the deferred tax asset and liability balances for capitalized research & development, disallowed business interest expense and property, plant, and equipment. The Company will continue to evaluate the OBBBA provisions for their potential impact on future periods. Deferred income tax liabilities consist of the following: Year ended December 31, 2025 2024 (in thousands) Deferred tax assets consist of the following: Capitalized research & development $ 3,125 $ 4,653 Deferred finance charges 1,897 4,275 Inventory reserve 31,133 26,534 Other 19,748 23,278 Disallowed business interest expense 177,973 180,571 Operating lease liability 58,468 43,744 Pension 899 1,134 Tax losses carried forward 13,372 11,397 Deferred tax assets, before valuation allowance 306,615 295,586 Valuation allowance ( 120,222 ) ( 117,650 ) Deferred tax assets 186,393 177,936 Deferred tax liabilities consist of the following: Property, plant and equipment ( 38,569 ) ( 35,836 ) Intangible assets ( 231,426 ) ( 246,422 ) Operating lease right of use asset ( 55,252 ) ( 55,966 ) Other ( 15,520 ) ( 8,457 ) Deferred tax liabilities ( 340,767 ) ( 346,681 ) Net deferred tax liability $ ( 154,374 ) $ ( 168,745 ) Changes to the Company’s valuation allowance are as follows: As of December 31, 2025 2024 2023 (in thousands) Balance, beginning of the year $ 117,650 $ 94,812 $ 62,958 Additions charge to income tax expense 2,919 26,050 31,953 Reductions credited to income tax expense ( 347 ) ( 3,212 ) ( 99 ) Change in valuation allowance 2,572 22,838 31,854 Balance, end of the year $ 120,222 $ 117,650 $ 94,812 The total increase in valuation allowance was $ 2.6 million, $ 22.8 million and $ 31.9 million for the years ending December 31, 2025, 2024 and 2023, respectively. A “more likely than not” criterion is applied when evaluating the 106 realizability of a deferred tax asset. A valuation allowance of $ 120.2 million at December 31, 2025 and $ 117.7 million at December 31, 2024 has been recorded against the foreign net operating losses in various countries and U.S. Section 163(j) interest expense carryforwards as the Company has determined that it is more likely than not that the amount of the deferred tax assets will not be realized. A portion of the foreign losses may be carried forward indefinitely, as well as the U.S. Section 163(j) limitation. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, available taxes in the carryback periods, projected future taxable income and tax planning strategies in making this assessment. As of December 31, 2025, unrecognized tax benefits related to prior year tax positions (including interest and penalties) were $ 5.8 million of which $ 5.8 million would affect the effective income tax rate if recognized. The Company’s policy is to recognize interest and penalties associated with uncertain tax positions as part of the provision for income taxes. As of December 31, 2025, accrued interest and penalties related to unrecognized tax benefits was approximately $ 2.0 million. The following table represents a reconciliation of the unrecognized tax benefits, not including interest and penalties. As of December 31, 2025 2024 2023 (in thousands) Balance, beginning of the year $ — $ — $ — Increases related to prior year tax positions 3,773 — — Decreases related to prior year tax positions — — — Settlements — — — Foreign currency impacts — — — Increases related to current year tax positions — — — Lapse of statute of limitations — — — Balance, end of the year $ 3,773 $ — $ — The Company adopted ASU 2023-09 on a prospective basis for the year ending December 31, 2025. The table below presents income taxes paid (net of refunds received) as a result of our adoption for the year ending December 31, 2025: As of December 31, 2025 (in thousands) Income Taxes Paid: Federal Taxes $ 33,943 State Taxes 13,316 Foreign Taxes: Canada 46,903 Other Foreign Jurisdictions 8,308 Total Income Taxes Paid $ 102,470 Below is a summary of income taxes paid (net of refunds received) for the years ending December 31, 2024 and December 31, 2023: Year ended December 31, 2024 2023 (in thousands) Total Cash taxes Paid $ 101,652 $ 99,506 107 The Company files a U.S. federal income tax return as part of a consolidated group as well as income tax returns in various states and other foreign jurisdictions. The Company is open to examination in the United States. for 2019 onward, and Canada for 2021 onward. Generally, for the remaining tax jurisdictions, years from 2020 onward are still open to examination. NOTE 15: COMMITMENTS AND CONTINGENCIES Commitments The Company has future contractual commitments of $ 30.9 million as of December 31, 2025, and had $ 30.6 million as of December 31, 2024, for capital commitments. The Company entered into a rental engine lease agreement that has not yet commenced as of December 31, 2025. The lease is for 5 years with future lease payments estimated to total approximately $ 11.4 million. Contingent liabilities The Company is involved, from time to time, in legal actions and claims arising in the ordinary course of business. Although predicting the outcome of legal actions and claims is difficult, based on current knowledge and consultation with legal counsel, the Company does not expect the outcome of these matters, either individually or in aggregate, to have a material adverse effect on the Company’s consolidated financial position. From time to time, the Company enters into contracts that contain liquidated damage provisions, which provide for the payment of damages to the Company’s customers in the event of non-compliance with certain contractually-specified terms and conditions. The Company evaluates its exposure to these provisions on a contract-by-contract basis, and records provisions for such contractual provisions when it has been determined that a loss is probable and estimable. As of December 31, 2025 and December 31, 2024 the provision is nominal. The Company has facilities that are located on land that has been used for industrial purposes for an extended period of time. The Company has not been named as a defendant in any environmental suit. Management believes that the Company is currently in substantial compliance with environmental laws. The Company incurs capital and operating costs relating to environmental compliance on an ongoing basis. The Company does not believe it will be required under existing environmental laws to expend amounts that would have a material adverse effect on its financial position or results of operations as a whole. NOTE 16: GUARANTEES The Company issues letters of credit, performance bonds, bid bonds or guarantees in the ordinary course of business. These instruments are generally is sued in conjunction with contracts or other business requirements. The total of these instruments outstanding was approximately $ 27.2 million and $ 20.6 million as of December 31, 2025 and December 31, 2024 , respectively. NOTE 17: RELATED PARTY TRANSACTIONS In connection with the Acquisition, on April 4, 2019, Dynasty Acquisition entered into a consulting services agreement (the “Carlyle Services Agreement”) with Carlyle Investment Management L.L.C. (“CIM”), pursuant to which Dynasty Acquisition paid CIM a one-time fee of approximately $ 24.5 million for strategic advisory and consulting services provided to Dynasty Acquisition in connection with the Acquisition. Pursuant to the Carlyle Services Agreement, and subject to certain conditions, Dynasty Acquisition also pays to CIM an annual fee of approximately $ 2.4 million, payable in quarterly installments in advance, for the advisory, consulting and other services provided by CIM pursuant to the Carlyle Services Agreement. Dynasty Acquisition also reimburses CIM’s reasonable out-of-pocket expenses incurred in connection with services provided pursuant to the Carlyle Services Agreement, and Dynasty Acquisition may pay CIM additional fees associated with other future transactions or in consideration of any additional services provided under the Carlyle Services Agreement. In connection with the IPO, the Carlyle Services Agreement was amended and restated, and will continue in full force and effect until the earlier of the second anniversary of the consummation of the IPO, which is October 3, 2026, and the date on which CIM and its affiliates collectively and 108 beneficially own, directly or indirectly, less than 10 % of the Company’s outstanding voting common stock. For the year ended December 31, 2025, the Company paid CIM approximately $ 2.4 millio n pursuant to the Carlyle Services Agreement. For the year ended December 31, 2024, the Company paid CIM approximately $ 2.4 million. In connection with the Acquisition, on April 4, 2019, Dynasty Acquisition entered into a consulting service agreement (the “Beamer Services Agreement”) with Beamer In vestment Inc., an affiliate of GIC, pursuant to which Dynasty Acquisition paid Beamer Investment Inc. a one-time fee of approximately $ 5.5 million for strategic advisory and consulting, services provided to Dynasty Acquisition in connection with the Acquisition. Pursuant to the Beamer Services Agreement, and subject to certain conditions, Dynasty Acquisition also pays to Beamer Investment Inc. an annual fee of approximately $ 0.6 million, payable in quarterly installments in advance, for the advisory, consulting and other services provided by Beamer Investment Inc. pursuant to the Beamer Services Agreement. Dynasty Acquisition also reimburses Beamer Investment Inc.’s reasonable out-of-pocket expenses incurred in connection with services provided pursuant to the Beamer Services Agreement, and Dynasty Acquisition may pay Beamer Investment Inc. additional fees associated with other future transactions or in consideration of any additional services provided under the Beamer Services Agreement. In connection with the IPO, the Beamer Services Agreement was amended and restated, and will continue in full force and effect until the earlier of the second anniversary of the consummation of the IPO and the date on which Beamer Investment Inc. and its affiliates collectively and beneficially own, directly or indirectly, less than 50 % of th e Company’s outstanding voting common stock that they owned on the date of the closing of the IPO, prior to giving effect to the sale of shares by Beamer Investment Inc. or an affiliate of Beamer Investment Inc. in the IPO. For the year ended December 31, 2025, the Company paid Beamer Investment Inc. approximately $ 0.6 million pursuant to the Beamer Services Agreement. For the year ended December 31, 2024, the Company paid Beamer Investment Inc. approximately $ 0.6 million. The Company expensed $ 3.0 million for the years ended December 31, 2025, 2024 and 2023, respectively, for advisory and consulting services as outlined above, $ 0.8 million as consideration for the services provided by Carlyle as a lead arranger in connection with the New 2024 Term Loan Facilities and $ 0.4 million as consideration for the services Carlyle provided for the September 2024 amendment to the Prior Credit agreement, as well as $ 1.2 million for the year ended December 31, 2023 as consideration for the services provided by Carlyle as a lead arranger in connection with the Prior 2023 Term Loan Facilities. An affiliate of Carlyle also served as one of the underwriters of the IPO for which it received underwriting discounts and commissions of approximately $ 5.6 million. CFGI, a portfolio company of a fund affiliated with Carlyle, provides the Company with accounting advisory and consulting services. For the year ended December 31, 2025 , the Company expensed $ 3.7 million and paid $ 3.2 million, to CFGI for accounting advisory and consulting services. For the year ended December 31, 2024, the Company expensed $ 4.5 million and paid $ 3.2 million, to CFGI for accounting advisory and consulting services. There were no similar payments to CFGI for the year ended December 31, 2023. NOTE 18: EMPLOYEE BENEFIT PLANS Defined contribution pension plans The Company has several def ined contribution plans covering substantially all of its employees. Costs for the defined contribution plans were $ 26.3 million, $ 24.4 million and $ 21.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. 109 Defined benefit pension plans The Company maintains defined benefit plans for certain employees in the United Kingdom and France. In the United Kingdom, the Company maintains two defined benefit schemes which provide both pensions in retirement and death benefits to members. Pension benefits are related to the member’s final salary at retirement (or their career average revalued salary) and their length of service. The main scheme is the Vector Aerospace International Limited Pension Scheme (the “Scheme”). The other defined benefit scheme is the Vector Aerospace 1998 Pension Plan (the “Plan”). The Scheme and Plan are generally closed for new members, who participate in a separate defined contribution plan. In France, the defined benefit plan is a government-mandated defined obligation that provides employees with retirement indemnities in the form of lump sums on the basis of the length of service and employee compensation levels. The plan is unfunded and benefits are paid when amounts become due, commencing when participants retire. Actuarial gains and losses of the year for long service awards are immediately recognized in the Consolidated Statements of Operations. An actuarial valuation of the defined benefit plans was prepared as of December 31, 2025 and 2024. The following table summarizes the funded status of the United Kingdom and France defined benefit pension plans as follows: December 31, 2025 December 31, 2024 France United Kingdom France United Kingdom (in thousands) Fair value of plan assets, beginning of year $ — $ 64,856 $ — $ 71,602 Actual return on assets — 1,929 — ( 6,308 ) Company contribution — 3,677 — 3,478 Benefits paid — ( 3,316 ) — ( 2,728 ) Foreign exchange — 4,908 — ( 1,188 ) Plan assets, end of year $ — $ 72,054 $ — $ 64,856 Projected pension obligation, beginning of year $ ( 2,569 ) $ ( 64,855 ) $ ( 2,806 ) $ ( 75,678 ) Service costs ( 149 ) — ( 132 ) — Interest costs ( 94 ) ( 3,775 ) ( 79 ) ( 3,323 ) Actuarial gains (losses) ( 168 ) 594 ( 115 ) 10,110 Benefits paid 238 3,316 390 2,728 Foreign exchange ( 337 ) ( 4,910 ) 173 1,308 Projected pension obligation, end of year ( 3,079 ) ( 69,630 ) ( 2,569 ) ( 64,855 ) Overfunded (underfunded) status, end of year $ ( 3,079 ) $ 2,424 $ ( 2,569 ) $ 1 The accumulated benefit obligation for all defined benefit pension plans was $ 71.6 million and $ 65.4 million at December 31, 2025 and December 31, 2024. December 31, 2025 December 31, 2024 France United Kingdom France United Kingdom (In thousands) Accumulated benefit obligation, end of year $ 2,356 $ 69,226 $ 1,960 $ 63,478 Accumulated benefit obligation, beginning of year 1,960 63,478 2,207 73,510 Amounts recognized in the Consolidated Balance Sheets consist of $ 3.0 m illion in Other assets and $ 3.6 million in Other non-current liabilities as of December 31, 2025 , and $ 2.6 million as of December 31, 2024, in Other non-current liabilities. 110 Amounts recognized in accumulated other comprehensive loss consist of the following amounts: As of December 31, 2025 2024 (in thousands) Cumulative gross unrecognized, net actuarial loss $ ( 5,604 ) $ ( 3,964 ) Related tax impact 1,450 952 Total included in accumulated other comprehensive loss $ ( 4,154 ) $ ( 3,012 ) The net periodic benefit cost charged to the Consolidated Statements of Operations includes the following components (in thousands): Year ended December 31, 2025 2024 2023 Service cost $ 149 $ 132 $ 135 Interest cost 3,869 3,402 3,397 Expected return on plan assets ( 4,119 ) ( 3,406 ) ( 3,207 ) Amortization of net (gain) loss ( 13 ) ( 76 ) ( 78 ) $ ( 114 ) $ 52 $ 247 The principal long-term assumptions on which the valuation was based are as follows: France United Kingdom France United Kingdom 2025 2025 2024 2024 Discount rate to determine benefit obligations - Plan 3.55 % 5.63 % 3.40 % 5.54 % Discount rate to determine benefit obligations - Scheme n/a 5.61 % n/a 5.54 % Discount rate – to determine net periodic benefit cost 3.55 % 5.54 % 3.40 % 4.55 % Compensation growth rate 3.00 % 3.64 % 3.00 % 3.83 % Expected return on plan assets – Scheme n/a 6.00 % n/a 6.10 % Expected return on plan assets – Plan n/a 5.54 % n/a 5.47 % The United Kingdom defined benefit plan assets are held in trust by the Trustees. The Trustees determine the investment strategy for the plan assets after taking advice from investment advisers and consulting with the Company. The assets chosen are invested in a diverse portfolio of investments in order to reduce investment risk. The allocation of investments is likely to change as a result of a range of factors such as changes in market conditions and the expected returns and risks. The two defined benefit pension arrangements in the United Kingdom have bespoke investment strategies to reflect the different maturity profiles and funding positions of the respective plans. The current investment strategy for the VA98 Plan includes target allocations for plan assets of approximately 9 % in liquid growth, 15 % in alternative assets and 76 % in liability-driven investments and corporate bonds. The current investment strategy for the VAIL Scheme includes target allocations for plan assets of approximately 18 % in liquid growth, 22 % in alternative assets and 60 % in liability-driven investments and corporate bonds. The Trustees recognize a number of risks involved in the investment of the plan assets and monitor and manage these risks on a regular basis, including through the use of derivatives, which are permitted within the investment strategy. The Company has an established and well-documented process for determining fair values. Fair value is based upon quoted market prices, where available. If listed prices or quotes are not available, fair value is based upon models that primarily use, as inputs, market-based or independently sourced market parameters, including yield curves, interest rates, volatilities, equity or debt prices, foreign exchange rates and credit curves. While the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The authoritative literature establishes a three-level hierarchy to prioritize the inputs used in measuring fair value. The levels within the hierarchy are described in the table below with Level 1 having the highest priority and Level 3 having the lowest. The Net Asset Value (“NAV”) is based on the value of the underlying assets owned by the fund, minus its liabilities, and then divided by the number of units outstanding. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value 111 measurement. The following is a description of the valuation methodologies used for the investments measured at fair value. • Cash - Cash is valued at the amount held on deposit by the custodian bank and is classified as Level 1 of the valuation hierarchy. • Equity and fixed income funds - these funds are valued at the closing NAV values supplied by the fund managers at the reporting date based on the fair value of the underlying investments of the funds and are classified within Level 2 of the fair value hierarchy unless the determination of fair value of the underlying investments within the funds requires significant unobservable data in which case the funds are classified as Level 3 of the valuation hierarchy. • Real estate and property funds - the NAV of these funds are valued based on appraisals of the underlying real estate investments. Such appraisals involve significant judgments with respect to estimates and assumptions and as a result these funds are classified within Level 3 of the valuation hierarchy. • Hedge funds - the NAV of these funds are valued using observable inputs including interest rate curves, credit spreads and volatilities and are classified within Level 2 of the valuation hierarchy • Other assets - These investments are priced based on unobservable inputs and are classified as Level 3 of the valuation hierarchy. The fair value of plan assets for the United Kingdom defined benefit plans by major category were as follows: As of December 31, 2025 Level 1 Level 2 Level 3 Total (in thousands) Cash $ 9 $ — $ — $ 9 Equity funds: International equities — 6,617 — 6,617 Emerging market equities — 936 — 936 Fixed income funds: U.S. and international government bonds — 36,103 — 36,103 Corporate bonds — 12,443 3,842 16,285 Emerging market bonds — 1,884 — 1,884 Real estate and property funds — — 7,751 7,751 Hedge funds — 1,585 — 1,585 Other funds — — 884 884 Fair value of pension assets $ 9 $ 59,568 $ 12,477 $ 72,054 The fair value of plan assets for the United Kingdom defined benefit plans by major category were as follows: As of December 31, 2024 Level 1 Level 2 Level 3 Total (in thousands) Cash $ 3,546 $ — $ — $ 3,546 Equity funds: International equities — 6,492 — 6,492 Emerging market equities — 907 — 907 Fixed income funds: U.S. and international government bonds — 25,494 — 25,494 Corporate bonds — 11,699 4,305 16,004 Emerging market bonds — 1,784 — 1,784 Real estate and property funds — — 7,489 7,489 Hedge funds — 1,988 — 1,988 Other funds — — 1,152 1,152 Fair value of pension assets $ 3,546 $ 48,364 $ 12,946 $ 64,856 112 The following table represents the reconciliation of the Level 3 pension assets measured at fair value: Corporate Bonds funds Real Estate and Property funds Other funds Total (in thousands) Balance, December 31, 2023 $ 3,658 $ 7,859 $ 1,309 $ 12,826 Sales — ( 482 ) ( 13 ) ( 495 ) Change in market value: 711 259 ( 69 ) 901 Foreign exchange ( 64 ) ( 147 ) ( 75 ) ( 286 ) Balance, December 31, 2024 $ 4,305 $ 7,489 $ 1,152 $ 12,946 Sales ( 1,165 ) ( 779 ) — ( 1,944 ) Change in market value: 377 460 ( 80 ) 757 Foreign exchange 325 581 ( 188 ) 718 Balance, December 31, 2025 $ 3,842 $ 7,751 $ 884 $ 12,477 The Company expects to contribute $ 3.7 million to its pension plans in 2026. Future estimated benefit payments over the next 10 years from the United Kingdom and France defined benefit plans for the years ending December 31 and thereafter are as follows (in thousands): 2026 $ 3,460 2027 3,358 2028 3,747 2029 3,753 2030 4,035 Thereafter (2031-2035) 20,311 Total $ 38,664 NOTE 19: STOCK BASED COMPENSATION Corporate Restructuring and Restructuring Transactions In connection with and prior to the completion of the IPO, the Company effected certain restructuring transactions. These restructuring transactions consisted of (i) the 103-for-one forward stock split of our common stock effected on September 20, 2024, (ii) the distribution to former holders of Class A-1 Units and Class A-2 Units of Dynasty Parent Holdings, L.P. an aggregate of 275,053,375 shares of our common stock (of which 8,157 were restricted shares at the time of distribution), and to holders of Class B Units of Dynasty Parent Holdings, L.P. an aggregate of 6,158,255 shares of our common stock (of which 6,028,394 were restricted shares at the time of distribution), and (iii) the liquidation and dissolution of Dynasty Parent Holdings, L.P. Immediately following the Restructuring Transactions, 281,211,630 shares of our common stock were issued and outstanding. Due to the 103-for-one forward stock split all share and per share amounts for all periods presented here have been adjusted retroactively, where applicable, to reflect this split. Additionally, see Note 4 Earnings (loss) per share. 2019 Long-Term Incentive Plan (“Prior Plan”) During the period from April 4, 2019 through September 20, 2024, certain directors and consultants, and the employees, directors and consultants of the Company's affiliates, were granted Units in Dynasty Parent Holdings, L.P. (“the Partnership”). The Partnership had two classes of Partners: Class A Partners representing initial investors and Class B Partners representing certain members of management, employees and non-employee directors. Under the Prior Plan employees, directors and consultants, and the employees, directors and consultants of our affiliates, were eligible to receive Class A-2 Units or Class B Units in the Partnership or options to purchase shares of common stock of the Company. Class B Units were granted under the Prior Plan with a benchmark amount intended 113 to allow the Class B Units to qualify as profits interests for U.S. federal income tax purposes. Since the completion of the IPO on October 2, 2024, no new awards have been or will be issued under the Prior Plan. Upon the IPO the Class A-2 and Class B units were converted into Restricted Stock Awards ("RSAs"). The RSAs and options generally vest 50 % based on the holder’s continued employment (“Time-Based”) and 50 % based on the achievement of specified performance-based measures (“Performance-Based”) and subject to continued employment. The related expense is being recognized over the estimated service period, which begins from the time of issuance to the estimated liquidity event. Time-Based units and options vest immediately prior to the date of a liquidity event, subject to continued employment from the grant date through the date of the liquidity event. The Performance-Based units and options become eligible to vest subject to the achievement of certain performance measures. The eligible Performance-Based units and options vest immediately prior to the date of a liquidity event subject to continued employment from the grant date through the date of the liquidity event. All of the Company's awards are considered equity classified awards. The RSAs and options did not vest until a liquidity event, as such the Company did not begin recognizing compensation expense until the liquidity event became probable upon the IPO on October 2, 2024. The Company uses an option pricing model to estimate the fair value of the equity awards that vest upon the occurrence of a liquidity event, which includes the RSAs and options. The fair value was determined by considering the ownership percentage in the Partnership, the preference of the Class A units and a discount for lack of marketability. The following assumptions for the option pricing model were used in determining the fair value of the Class B units at the initial grant date of April 4, 2019: Risk free interest rate 1.84 % Expected volatility 37.50 % Expected time to liquidity 4.5 years Dividend yield 0.00 % Discount for lack of marketability 30.0 % The Company has historically been a private company and lacked company-specific historical and implied volatility information for its stock. Therefore, the Company estimated its expected stock price volatility based on the historical volatility of publicly traded peer companies over a look-back period similar to the expected term. The expected term of the Class B unit awards and stock option awards is the period of time for which the Class B unit awards and the stock option awards are expected to be outstanding until exercise and considers time until an anticipated liquidity event. The risk-free interest rate was determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. In addition, the Company considered Class B units to be junior securities, without the same rights as Class A units of the Partnership, as such the 30 % discount was applied for lack of marketability associated with the expected holding period of Class B units. The calculation of the fair value of awards also requires an estimate of the Company’s equity value. As the Company historically has been a privately held company with no trading history for its common stock to date, the estimated fair value of the Company’s common stock was determined by the Board of Directors, with input from management and valuations by third-party specialists. To determine the fair value, the Board of Directors considered most recently available third-party valuations of common stock and an assessment of additional objective and subjective factors that it believed were relevant and which may have changed from the date of the most recent valuation through the date of the grant. Additional factors include, among others, the nature and history of the Company’s business; the Company’s stage of development and commercialization; external market conditions; valuations of the Company’s industry peers; and the likelihood of achieving a liquidity event, or sale of the Company. 2024 Incentive Award Plan Effective upon the IPO date of October 2, 2024, the Company adopted and our stockholders approved the 2024 Incentive Award Plan (the “2024 Plan”), under which the Company may grant cash and equity incentive awards to 114 eligible service providers in order to attract, motivate and retain the talent for which the Company competes. An aggregate of 19,662,698 shares of the Company's common stock were initially made available for issuance under the 2024 Plan. No more than 19,662,698 shares of common stock may be issued upon the exercise of incentive stock options ("ISOs"). Shares issued under the 2024 Plan may be authorized but unissued shares, shares purchased in the open market or treasury shares. If an award under the 2024 Plan or Prior Plan is forfeited, expires or is settled for cash, any shares subject to such award may, to the extent of such forfeiture, expiration or cash settlement, be used again for new grants under the 2024 Plan. Awards granted under the 2024 Plan upon the assumption of, or in substitution for, awards authorized or outstanding under a qualifying equity plan maintained by an entity with which we enter into a merger or similar corporate transaction will not reduce the shares available for grant under the 2024 Plan. The 2024 Plan provides for the grant of stock options, including ISOs, and nonqualified stock options (“NSOs”), stock appreciation rights (“SARs”), restricted stock, dividend equivalents, restricted stock units (“RSUs”) and other stock or cash-based awards. Certain awards under the 2024 Plan may constitute or provide for payment of nonqualified deferred compensation, under Section 409A of the Code. All awards under the 2024 Plan are subject to the terms set forth in award agreements, which detail the terms and conditions of awards, including any applicable vesting and payment terms and post-termination exercise limitations. Stock options granted under the 2024 Plan generally vest in three equal annual installments, subject to the participant’s continued employment with the Company, and expire ten years from the date of grant. The Company uses a Black-Scholes pricing model to estimate the grant-date fair value of the stock options awarded. The Black-Scholes pricing model requires assumptions regarding the expected volatility of the Company’s shares of Common Stock, the risk-free interest rate, the expected term of the stock option award and the Company’s dividend yield. Term. The Company began being publicly traded on October 2, 2024, and as such does not have sufficient historical data to estimate the expected term of the stock option awards. In the absence of sufficient historical data, where the options are considered “plain vanilla,” the SEC’s Staff Accounting Bulletin No. 110 (“SAB 110”) provides guidance for a simplified method of estimating the expected term until more empirical data becomes available. This method calculates the expected term as the average of the weighted vesting term and the contractual term of the options. As such, the Company utilized the SEC's simplified method to calculate the expected term for the options which resulted in a term of 6.0 years. Expected Dividends. The Company does not pay dividends and is not expected to pay dividends in the near term. As such, the Company elected to use a dividend yield of 0 % Risk-Free Rate. The Company used the U.S. Treasury Securities yield corresponding to the expected term, of 4.07 %. Expected Volatility. The Company began being publicly traded on October 2, 2024, followed by additional secondary offerings in March 2025 and May 2025, thus the Company has limited trading data to calculate meaningful volatility. As such, the Company relied solely on peer group volatility, calculated at 40.0 %. 115 Stock Options: The following is a summary of the activity for stock option awards: Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2023 — — — — Granted 463,194 $ 10.51 Exercised — — Forfeited — — Outstanding at December 31, 2024 463,194 $ 10.51 5.75 $ 6,600 Granted 737,354 $ 25.62 Exercised — — Forfeited ( 57,426 ) $ 25.62 Outstanding at December 31, 2025 1,143,122 $ 19.50 7.39 $ 10,497 Options Exercisable at December 31, 2025 50,347 $ 9.93 3.73 $ 944 Restricted Stock Units (“RSUs”): The RSUs granted in 2025 under the 2024 Plan generally vest in three equal annual installments, subject to the participant’s continued employment with the Company. The fair value of RSUs granted is estimated using the closing price of the Company’s stock on the grant date. The following is a summary of the activity for RSUs: Shares Weighted Average Grant Date Fair Value per Share Nonvested at December 31, 2023 — — Granted 238,540 $ 29.81 Vested — — Forfeited — — Nonvested at December 31, 2024 238,540 $ 29.81 Granted 557,875 $ 26.11 Vested ( 8,634 ) $ 32.02 Forfeited ( 117,638 ) $ 27.56 Nonvested at December 31, 2025 670,143 $ 27.10 116 Restricted Stock Awards (“RSAs”): The following is a summary of the activity for RSAs: Shares Weighted Average Grant Date Fair Value per Share Nonvested at December 31, 2023 — — Corporate restructuring 6,036,550 $ 5.02 Vested — — Forfeited — — Nonvested at December 31, 2024 6,036,550 $ 5.02 Granted — — Vested ( 19,963 ) $ 7.44 Forfeited ( 176,019 ) $ 6.78 Nonvested at December 31, 2025 5,840,568 $ 4.96 5,840,568 RSAs were outstanding and included in the Company’s 334,294,245 shares of Common Stock outstanding at December 31, 2025. Stock Based Compensation Expense: The Co mpany recorded $ 13.2 million and $ 17.4 million in stock compensation expense during the years ended December 31, 2025 and 2024, respectively. The Company will continue to recognize stock compensation expense ratably over the requisite remaining service period for the awards. As of December 31, 2025, there w as $ 27.6 million o f unrecognized compensation costs. Stock Repurchase Program: On December 9, 2025, the Board of Directors of the Company approved a stock repurchase program, effective immediately. The stock repurchase program authorizes the Company to repurchase up to $ 450.0 million of the Company’s common stock, par value $ 0.01 , subject to market conditions, contractual restrictions and other factors. Repurchases under the program may be made in the open market, in privately negotiated transactions or otherwise, with the amount and timing of repurchases depending on market conditions and corporate needs. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18. The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this authorization. This program does not obligate the Company to acquire any particular amount of Common Stock and the program may be extended, modified, suspended or discontinued at any time at the Company’s discretion. No stock repurchases were made during the year ended December 31, 2025. As of December 31, 2025, $ 450.0 million remained available for repurchase under the stock repurchase program. See Note 26, "Subsequent Events" for further details of the Company's share repurchases made in 2026. NOTE 20: FAIR VALUE MEASUREMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The inputs used to measure fair value into the following hierarchy are determined as follows: Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 - Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. Level 3 - Unobservable inputs for the asset or liability. 117 For cash and cash equivalents, accounts receivable, income taxes receivable and accounts payable, the fair value approximates the carrying value due to the short maturity periods of these financial instruments. For long-term borrowings, the fair value is measured using Level 2 market values. The interest rate swaps, interest rate caps and foreign exchange contracts are carried at fair value in the Consolidated Balance Sheets. The fair value measurement is classified within Level 2 of the fair value hierarchy, as the inputs to the derivative pricing model are generally observable and do not contain a high level of subjectivity. The fair value of the interest rate agreements is estimated using industry standard valuation models using market-based observable inputs. The Company’s term loan borrowing, which is SOFR-based, approximates fair value at December 31, 2025. The inputs used to measure the fair value of the Company’s debt instrument are classified as Level 2 within the fair value hierarchy. Valuation of Contingent Consideration Liability The fair value of earnout consideration was estimated based on applying a Monte Carlo simulation method to forecast achievement of the gross profit targets. This method involves many possible value outcomes which are evaluated to establish an estimated value. Key inputs in the valuation include volatility and discount rates. Due to the significant unobservable inputs used in the valuations, these liabilities are categorized within Level 3 of the fair value hierarchy. The Company determined the initial value for the contingent consideration liability o f $ 15.2 million at December 31, 2024, using the Level 3 inputs below as of the issuance date on August 23, 2024. There were no changes in the estimated fair value of the contingent consideration as of December 31, 2025. The following table represents the significant inputs used in calculating the fair value of the contingent consideration liability on the issuance date: Longest midpoint term 1.86 Gross profit discount rate 10.7 % Risk-free rate 3.9 % Gross profit volatility 23.3 % Payment discount rate 13.2 % The contingent consideration measured at fair value using unobservable inputs decreased from the initial measurement of $ 15.2 million as of December 31, 2024 to $ 8.2 million as of December 31, 2025. The Company paid $ 7.0 million of contingent consideration during the year ended December 31, 2025. The current portion of the $ 8.2 million contingent consideration liability is recorded in Accrued and other current liabilities and the non-current portion is recorded in Other non-current liabilities. 118 The following table summarizes the carrying amounts and fair values of financial instruments: As of December 31, 2025 As of December 31, 2024 Balance Sheet Classification Level Carrying Amount Fair Value Carrying Amount Fair Value (in thousands) Assets: Interest rate swaps Prepaid expenses and other current assets 2 $ — $ — $ 1,539 $ 1,539 Foreign exchange contracts Prepaid expenses and other current assets 2 1,757 1,757 — — Total assets $ 1,757 $ 1,757 $ 1,539 $ 1,539 Liabilities: Interest rate caps Accrued expenses and other current liabilities 2 6,808 6,808 8,967 8,967 Interest rate caps Other non-current liabilities 2 — — 3,709 3,709 Contingent consideration - current Accrued expenses and other current liabilities 3 7,000 7,000 7,000 7,000 Contingent consideration - non-current Other non-current liabilities 3 1,150 1,150 8,150 8,150 Total liabilities $ 14,958 $ 14,958 $ 27,826 $ 27,826 The gains (losses) on the Company’s derivative instruments were as follows: Year Ended December 31, Statement of Operations Classification 2025 2024 2023 (in thousands) Amount of (loss) gain recognized in net income: Interest rate swaps Interest expense $ 2,183 $ 9,458 $ 18,956 Interest rate caps Interest expense ( 9,844 ) ( 293 ) ( 625 ) Foreign exchange contracts Selling, general and administrative expense 2,141 818 265 Total (loss) gain in net income $ ( 5,520 ) $ 9,983 $ 18,596 Statement of Comprehensive Income Classification Amount of (loss) gain recognized in other comprehensive income (loss): Interest rate swaps Cash flow hedge gain $ 644 $ 4,876 $ 7,851 Interest rate caps Cash flow hedge loss ( 4,218 ) ( 519 ) ( 7,686 ) Foreign exchange contracts Cash flow hedge gain (loss) 3,899 ( 103 ) 1,677 Total gain recognized in other comprehensive income $ 325 $ 4,254 $ 1,842 119 NOTE 21: DERIVATIVES AND HEDGING The Company is exposed to, among other things, the impact of changes in interest rates and foreign currency exchanges rates in the normal course of business. The Company’s objective in risk management is to utilize interest rate derivatives to add stability to interest expense and manage its exposure to interest rate movements and utilize foreign exchange rate derivatives to add stability to foreign exchange expense and manage its exposure to exchange rate movements. To accomplish this objective, the Company primarily uses (i) interest-rate swaps and interest-rate caps as part of its interest rate risk management strategy and (ii) foreign currency forward contracts to protect against the foreign currency exchange rate risk inherent on forecasted transactions. The Company uses derivative financial instruments only to the extent necessary to hedge identified business risks and does not enter into such transactions for trading purposes. Interest-rate swap and interest-rate cap agreements Interest-rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Interest-rate caps designated as cash flow hedges involve payment of a fixed premium to a counterparty in exchange for the company receiving a SOFR cap over the life of the agreement without exchange of the underlying notional amount. During the years ended December 31, 2025, 2024 and 2023, such derivatives were used to hedge the variable cash flows associated with its long-term debt agreements. The tables below summarize the key terms of the interest-rate swap and interest-rate cap agreements: Interest-rate swap agreements: Aggregate Notional Amount Effective Date Maturity Date Interest - Rate (In thousands) $ 500,000 (1) June 28, 2019 March 27, 2024 Average fixed SOFR rate of 2.41 % (2) $ 400,000 March 31, 2023 December 31, 2025 Fixed SOFR rate of 3.71 % (1) The original interest-rate swap agreement, dated November 30, 2022, has an initial notional amount of $ 1,000.0 million, decreasing to $ 750.0 million on March 31, 2022, and to $ 500.0 million on March 31, 2023. (2) The interest rate was amended on June 29, 2023 from LIBOR ( 2.47 %) to SOFR ( 2.41 %). Interest-rate cap agreements: Aggregate Notional Amount Effective Date Maturity Date Interest - Rate (In thousands) $ 1,500,000 (1) March 31, 2023 September 30, 2025 Capped SOFR rate of 4.45 % (2) $ 1,500,000 September 30, 2025 December 31, 2026 Capped SOFR rate of 5.00 % (1) The original interest-rate cap agreement, dated November 30, 2022, has an initial notional amount of $ 500.0 million, increasing to $ 1,000.0 million on March 31, 2023, and increasing to $ 1,500.0 million on March 28, 2024. (2) The interest rate was amended on June 29, 2023 from LIBOR ( 4.50 %) to SOFR ( 4.45 %). For the interest-rate swaps, differences between the hedged interest rate and the fixed rate are recorded as interest expense in the Consolidated Statements of Operations in the same period that the related interest is recorded for the Company’s long-term debt agreements. For the interest-rate caps, monthly premiums and differences received between the hedged interest rate and the interest rate cap are recorded to interest expense in the Consolidated Statements of Operations in the same period that the related interest is recorded for the Company’s long-term debt agreements. 120 Foreign currency forward exchange contracts The Company has operations in Canada, as well as other countries outside of North America, and consequently the Consolidated Balance Sheets can be affected by movements in exchange rates for limited balances denominated in foreign currency. Currency exposures can also arise from certain revenue and purchase transactions denominated in foreign currencies, primarily payroll costs which are in local currencies. The Company enters into short-term foreign exchange contracts throughout the year designated as a cash flow hedge to manage the exposure to changes in the exchange rate on its Canadian and United Kingdom payroll costs, requiring the Company to buy a notional amount of Canadian dollars and British Pounds Sterling. The contracts require the Company to buy a notional amount of the foreign currency at a set rate weekly from a reference date to maturity date, or until a maximum value is reached. On October 21, 2025, the Company entered into a GBP foreign currency contract at a notional value of USD $ 46.8 million and a CAD foreign currency contract at a notional value of CAD $ 260.0 million maturing on December 29, 2026 . On April 7, 2025, the Company entered into a foreign currency contract at a notional value of GBP 39.5 million and CAD 136.5 million, which matured on December 31, 2025 . Previously, the Company had one foreign currency contract that was entered on April 12, 2024 at a notional value of GBP 17.5 million and matured on December 31, 2024 . The amounts shown in the table below represent the gross amounts of recogniz ed assets and liabilities, the amounts offset in the Consolidated Balance Sheets and the net amounts of assets and liabilities presented therein: As of December 31, 2025 As of December 31, 2024 Asset Liability Asset Liability (in thousands) Foreign exchange contracts $ 1,757 $ — $ — $ — Interest-rate swap agreements — — 1,539 — Interest-rate cap agreements — 6,808 — 12,676 Net derivatives as classified in the consolidated balance sheets $ 1,757 $ 6,808 $ 1,539 $ 12,676 NOTE 22: GOVERNMENT GRANTS The Company received no material financial support from government programs during the years ended December 31, 2025, 2024 and 2023 . 121 NOTE 23: ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Comprehensive income (loss) includes all non-stockholder changes in equity. The changes in accumulated other comprehensive income (loss) by component is as follows: Interest-Rate Hedges Foreign Exchange Hedge Foreign Currency Translation Employee Benefit Plan Total (in thousands) Balance, December 31, 2022 $ 9,377 $ ( 358 ) $ ( 16 ) $ 1,290 $ 10,293 Other comprehensive gain (loss) before Reclassifications, net of income tax ( 267 ) 1,224 383 ( 4,468 ) ( 3,128 ) Amounts reclassified from accumulated other comprehensive loss ( 13,856 ) ( 193 ) — ( 78 ) ( 14,127 ) Net other comprehensive income (loss) ( 14,123 ) 1,031 383 ( 4,546 ) ( 17,255 ) Balance, December 31, 2023 $ ( 4,746 ) $ 673 $ 367 $ ( 3,256 ) $ ( 6,962 ) Other comprehensive gain (loss) before Reclassifications, net of income tax 3,317 ( 75 ) ( 367 ) 244 3,119 Amounts reclassified from accumulated other comprehensive loss ( 6,981 ) ( 598 ) — — ( 7,579 ) Net other comprehensive income (loss) ( 3,664 ) ( 673 ) ( 367 ) 244 ( 4,460 ) Balance, December 31, 2024 $ ( 8,410 ) $ — $ — $ ( 3,012 ) $ ( 11,422 ) Other comprehensive gain (loss) before Reclassifications, net of income tax ( 2,722 ) 2,846 — ( 1,142 ) ( 1,018 ) Amounts reclassified from accumulated other comprehensive income (loss) 5,834 ( 1,563 ) — — 4,271 Net other comprehensive income (loss) 3,112 1,283 — ( 1,142 ) 3,253 Balance, December 31, 2025 $ ( 5,298 ) $ 1,283 $ — $ ( 4,154 ) $ ( 8,169 ) NOTE 24: SEGMENT INFORMATION The Company’s chief operating decision making officer (“CODM”) is the Company’s Chief Executive Officer . Consistent with how the Company evaluates its performance and the way the Company is organized internally; the Company reports its activities in two segments: Engine Services and Component Repair Services. The CODM regularly uses the below financial measures to allocate financial and human resources to individual segments and evaluate segment performance. The CODM also uses these measures in the annual budget and quarterly forecasting processes. The CODM considers budget-to-actual variances on a monthly basis when making decisions about allocating capital and personnel to the segments. The Company’s CODM is regularly provided and evaluates the performance of the Company’s segments based on segment Revenue and segment Adjusted EBITDA. Management believes segment Adjusted EBITDA is indicative of operational performance and ongoing profitability and is used to evaluate the operating performance of the Company’s segments and for planning and forecasting purposes, including the allocation of resources and capital. The Company defines Segment Adjusted EBITDA as net income (loss) before interest expense, income tax expense (benefit), depreciation and amortization directly attributable to each operating segment and adjusted for certain non-cash items that the Company may record each period, as well as items not recurring in the ordinary course of business such as acquisition costs, integration and severance costs, refinance fees, business transformation costs and other discrete expenses, when applicable. Expense information is provided to and reviewed by the CODM on a consolidated basis to evaluate cost efficiency and company level performance. The Company’s Engine Services segment provides a full suite of aftermarket services, including maintenance, repair and overhaul, on-wing and field service support, asset management, and engineering and related solutions to customers 122 in the commercial aerospace, military & helicopter, and business aviation end markets. Revenue in the Engine Services segment is primarily derived from the repair and overhaul of a wide variety of gas turbine engines and auxiliary power units that power fixed and rotary wing aircraft. The Company also provides complementary maintenance, repair, upgrade and other related services for airframes and avionics systems in the business aviation and helicopter end markets. Cost of revenue consists primarily of cost of materials, direct labor and overhead. The Company’s Component Repair Services segment provides engine component and accessory repairs to the Commercial Aerospace, Military & Helicopter, and Other, including land and marine, and oil and gas end markets. Revenue in the Component Repair Services segment is derived from the engine piece part and accessory repairs that the Company performs, repair development engineering and other related services, and some engine new part manufacturing. Cost of revenue consists primarily of cost of materials, direct labor and overhead. The Company’s segment disclosure includes intersegment revenues, which primarily consist of subcontract services between segments. The revenue and corresponding cost of revenue are eliminated upon consolidation. The elimination of such intersegment transactions is included within intersegment revenue in the table below. The revenue is eliminated with the segment receiving the subcontract services. The segment providing services retains revenue while the segment receiving the services records the elimination. The Company does not report total assets by segment for internal or external reporting purposes as the Company’s CODM does not assess performance, make strategic decisions or allocate resources based on assets. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies (see Note 2, Summary of Significant Accounting Policies). Selected financial information for each segment is as follows: Year ended December 31, 2025 Engine Services Component Repair Services Total Segments (in thousands) Revenue from external customers $ 5,432,350 $ 630,163 $ 6,062,513 Intersegment revenue ( 78,397 ) 78,397 — Total segment revenue 5,353,953 708,560 6,062,513 Other segment items (1) 4,647,070 505,856 5,152,926 Segment Adjusted EBITDA $ 706,883 $ 202,704 $ 909,587 Corporate (2) 101,414 Depreciation and amortization 193,664 Interest expense 174,217 Business transformation costs (LEAP and CFM) (3) 26,028 Non-cash stock compensation expense 13,237 Integration costs and severance (4) 5,601 Other (5) 18,574 Income before income taxes $ 376,852 (1) Other segment items for each reportable segment primarily includes cost of sales and other selling, general and administrative expenses. (2) Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Corporate Supply Chain and Corporate Engineering Services finance, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company’s debt. (3) Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of the Company’s CFM56 capabilities into Dallas, Texas. (4) Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs. 123 (5) Represents professional fees related to business transformation, secondary offering costs, loss on disposals and quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of the Company’s ordinary course of continuing operations. See Note 17, “Related Party Transactions” for descriptions of the consulting services agreements with Carlyle Investment Management L.L.C. and Beamer Investment Inc. Year ended December 31, 2024 Engine Services Component Repair Services Total Segments (in thousands) Revenue from external customers $ 4,712,468 $ 524,693 $ 5,237,161 Intersegment revenue ( 67,729 ) 67,729 — Total segment revenue 4,644,739 592,422 5,237,161 Other segment items (1) 4,033,833 437,688 4,471,521 Segment Adjusted EBITDA $ 610,906 $ 154,734 $ 765,640 Corporate (2) 75,108 Depreciation and amortization 188,164 Interest expense 282,507 Business transformation costs (LEAP and CFM) (3) 43,238 IPO-related costs 26,909 Refinancing costs 23,700 Loss on debt extinguishment 15,255 Stock compensation (4) 17,376 Integration costs and severance (5) 2,782 Acquisition Costs (6) 1,374 Other (7) 7,470 Income before income taxes $ 81,757 (1) Other segment items for each reportable segment primarily includes cost of sales and other selling, general and administrative expenses. (2) Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Corporate Supply Chain and Corporate Engineering Services finance, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company’s debt. (3) Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of our CFM56 capabilities into Dallas, Texas. (4) Represents non-cash stock compensation expense associated with awards issued under 2019 Long-Term Incentive Plan in connection with Carlyle’s ownership. Because those awards do not vest until a liquidity event, the Company did not begin recognizing any associated stock compensation expense until the Company’s IPO on October 2, 2024, when a liquidity event became probable. (5) Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs. (6) Represents transaction costs incurred in connection with planned and completed acquisitions, including legal and professional fees, debt arrangement fees and other third-party costs. (7) Represents quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of our ordinary course of continuing operations. 124 Year ended December 31, 2023 Engine Services Component Repair Services Total Segments (in thousands) Revenue from external customers $ 4,097,621 $ 465,663 $ 4,563,284 Intersegment revenue ( 47,753 ) 47,753 — Total segment revenue 4,049,868 513,416 4,563,284 Other segment items (1) 3,530,757 388,108 3,918,865 Segment Adjusted EBITDA $ 519,111 $ 125,308 $ 644,419 Corporate (2) 83,301 Depreciation and amortization 197,104 Interest expense 309,645 Business transformation costs (LEAP and CFM) (3) 11,363 Refinancing costs 19,921 Loss on debt extinguishment 6,182 Integration costs and severance (4) 1,374 Acquisition costs (5) 1,514 Other (6) 8,896 Profit before tax $ 5,119 (1) Other segment items for each reportable segment primarily includes cost of sales and other selling general and administrative expenses. (2) Corporate primarily consists of costs related to executive and staff functions, including Information Technology, Human Resources, Legal, Finance, Marketing, Corporate Supply Chain and Corporate Engineering Services finance, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies, and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. The Corporate function also includes expenses associated with the Company's debt. (3) Represents new product industrialization costs with the business transformation of the LEAP 1A/1B engine line in San Antonio, Texas and the expansion of our CFM56 capabilities into Dallas, Texas (4) Represents integration costs incurred, including any facility or platform consolidation associated with the integration of an acquisition that does not meet capitalization criteria and severance related to reduction in workforce or acquisitions. Examples of integration costs may include lease breakage or run-off fees, consulting costs, demolition costs or training costs. (5) Represents transaction costs incurred in connection with planned and completed acquisitions, including legal and professional fees, debt arrangement fees and other third-party costs. (6) Represents quarterly management fees payable to Carlyle Investment Management L.L.C. and Beamer Investment Inc. under consulting services agreements, representation and warranty insurance costs associated with acquisitions, that are the result of other, non-comparable events to measure operating performance as these events arise outside of our ordinary course of continuing operations. See Note 17, "Related Party Transactions" for descriptions of the consulting services agreements with Carlyle Investment Management L.L.C. and Beamer Investment Inc. The following table presents revenues from external customers by geographic area based on location of the customer: Year ended December 31, 2025 2024 2023 (in thousands) United States $ 3,388,883 $ 3,073,521 $ 2,862,358 United Kingdom 446,181 604,292 453,886 Canada 756,787 591,232 372,578 Rest of Europe (1) 544,737 402,111 360,258 Asia (1) 508,852 233,738 209,736 Rest of the world (1) 417,073 332,267 304,468 Total revenue $ 6,062,513 $ 5,237,161 $ 4,563,284 (1) Countries grouped within Rest of Europe, Asia, and Rest of world are individually immaterial as compared to total revenue with no country representing more than 3 % of total revenue for the years ended December 31, 2025, 2024 and 2023 . 125 The following table presents long-lived assets by geographic area: As of December 31, 2025 2024 (in thousands) United States $ 493,367 $ 418,990 Canada 154,959 160,883 United Kingdom 97,521 107,659 France 16,639 17,625 Singapore 17,226 14,758 Rest of the world 22,410 20,898 Total long-lived assets $ 802,122 $ 740,813 126 NOTE 25: FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY) STANDARDAERO, INC. BALANCE SHEETS (Parent Company) (In thousands, except share figures) As of December 31, 2025 2024 Assets Investment in subsidiaries $ 2,667,311 $ 2,373,404 Total assets $ 2,667,311 $ 2,373,404 Commitments and contingencies Stockholders' equity Common stock ($0.01 par value, 3,500,000,000 shares authorized; 334,461,630 issued and 334,294,245 outstanding as of December 31, 2025 and 334,461,630 shares issued and outstanding as of December 31, 2024) $ 3,345 $ 3,345 Preferred stock ($ 0.01 par value, 100,000,000 shares authorized; no shares were issued) — — Additional paid-in capital 3,958,039 3,944,802 Accumulated deficit ( 1,294,073 ) ( 1,574,743 ) Treasury stock (at cost, 176,019 and 0 shares as of December 31, 2025 and December 31, 2024) — — Total stockholders' equity 2,667,311 2,373,404 Total liabilities and stockholders' equity $ 2,667,311 $ 2,373,404 The accompanying notes are an integral part of the consolidated financial statements. 127 STANDARDAERO, INC. STATEMENTS OF OPERATIONS (Parent Company) (In thousands, except share figures) Year Ended December 31, 2025 2024 2023 Equity in net income (loss) of subsidiaries $ 277,417 $ 10,974 $ ( 35,061 ) Net income (loss) 277,417 10,974 ( 35,061 ) Equity in other comprehensive income (loss) of subsidiaries 3,253 ( 4,460 ) ( 17,255 ) Total Comprehensive income (loss) $ 280,670 $ 6,514 $ ( 52,316 ) 128 STANDARDAERO, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Parent Company) 1. Business StandardAero, Inc. (formerly Dynasty Parent Co., Inc.) (the “Company” or “Parent Company”) was incorporated on September 5, 2018, in the state of Delaware. 2. Accounting Policies These condensed Parent Company only financial statements have been prepared in accordance with Rule 12-04 of Regulation S-X, as stipulated by Rule 5-04, Section I from Regulation S-X. The ability of the Parent Company’s operating subsidiaries to pay dividends is restricted due to the terms of the Credit Agreement (as defined in Note 12, “Long-term debt,” to the audited consolidated financial statements) and indenture. A statement of cash flows has not been included in these condensed financial statements because there was no cash activity for the Parent Company in the periods presented. Parent Company is a holding company that conducts substantially all of its business operations through its subsidiaries. These condensed Parent Company only financial statements have been prepared using the same accounting principles and policies described in the notes to the consolidated financial statements, with the only exception being that the Parent Company accounts for investments in its subsidiaries using the Parent Company’s proportionate share of the subsidiary as the basis of accounting. These condensed financial statements should be read in conjunction with the consolidated financial statements and related notes thereto. Use of estimates Preparation of the condensed financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures. Those estimates are inherently subject to change, and actual results may ultimately differ from those estimates. NOTE 26: SUBSEQUENT EVENTS January 2026 Secondary Offering and Share Repurchase On January 29, 2026, the Selling Stockholders completed a public offering of an aggregate of 57,500,000 shares of Common Stock (including the full exercise by the underwriters of their option to purchase up to an additional 7,500,000 shares) at a price to the public of $ 31.00 per share (the “January 2026 Offering”). On January 29, 2026, the Company completed the repurchase of 1,637,465 shares of Common Stock from a selling stockholder affiliated with GIC (the “GIC Stockholder”) in a private transaction at a price of $ 30.54 per share (the “Share Repurchase”). The Share Repurchase was made pursuant to the Company’s existing stock repurchase program approved by its board of directors in December 2025 and pursuant to a stock purchase agreement, dated January 20, 2026, with the GIC Stockholder. The Share Repurchase was conditioned upon the completion of the January 2026 Offering and closed concurrently with such offering. The repurchased shares of Common Stock are no longer outstanding. As of January 29, 2026, Carlyle and GIC own approxim ately 31.4 % and 7.1 % of the C ompany’s outstanding Common Stock, respectively. 129 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure. None.