What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-13 compared with 2026-05-14 · 926 added, 825 removed, 426 unchanged (80% of the section changed)

3 unchanged sentences

amounts in USD, except number of shares)

Current assets

Prepaid expenses and

other current assets

Deferred transaction

June 30, 2026

December 31, 2025

Current assets

Prepaid expenses and other current assets

Deferred transaction costs

Total current assets

Property and equipment, net

1 unchanged sentence

Investment in equity securities

Right of use asset, net

Other long-term assets

LIABILITIES AND STOCKHOLDERS’

EQUITY (DEFICIT)

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current liabilities

Accounts payable

Accrued liabilities

and other current liabilities

Current portion of early

exercised shares option liability

Current portion of convertible

Accrued liabilities and other current liabilities

Current portion of early exercised shares option liability

Current portion of convertible note

Current portion of lease liability

Short-term loans

Total current liabilities

2 unchanged sentences

Convertible note

Early exercised shares

option liability

Lease liability

Early exercised shares option liability

Total liabilities

Commitments and contingencies (Note 3)

Stockholders’ equity

Preferred stock, $ 0.0001 par value, 100,000,000

shares authorized, Nil shares issued and outstanding as at March 31, 2026, and December 31, 2025

Common stock, $ 0.0001 par

value, 700,000,000 shares authorized, 9,966,473 and 9,869,558 shares issued and outstanding as at March 31, 2026, and December 31,

2025, respectively

Stockholders’ equity (deficit)

Preferred stock, $ 0.0001 par value, 100,000,000 shares authorized, Nil shares issued and outstanding as at June 30, 2026, and December 31, 2025

Common stock, $ 0.0001 par value, 700,000,000 shares authorized, 11,628,657 and 9,869,558 shares issued and outstanding as at June 30, 2026, and December 31, 2025, respectively

Additional paid-in capital

2 unchanged sentences

( 68,342,584 )

Total stockholders’

Total stockholders’ deficit

$ ( 8,240,860 )

$ ( 5,813,683 )

Total liabilities

and stockholders’ deficit

Total liabilities and stockholders’ deficit

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

2 unchanged sentences

amounts in USD, except number of shares)

and administrative expenses

General and administrative expenses

Operating Loss

1 unchanged sentence

( 3,036,347 )

Other income/ (expense)

( 7,879,584 )

( 8,784,994 )

Other income (expenses)

Interest income

2 unchanged sentences

( 697,321 ) 1

( 165,933 ) 1

Finance charge

Change in fair value of sponsor earnout

Change in fair value of sponsor earn out shares

Change in fair value of warrant liability

Change in fair value of investment in equity

Gain on extinguishment of liability

other income/ (expense)

Loss on sale of investment in equity securities

Loss on write-off of promissory note and deposit

Loss on extinguishment of liability, net

Total other income (expenses)

( 1,258,002 )

1 unchanged sentence

$ ( 3,704,438 )

loss per share 2

average common shares outstanding 2

related party amounts of nil and $ 58,229 for the three months ended March 31, 2026, and 2025, respectively.

$ ( 9,137,586 )

$ ( 7,514,138 )

Net loss per share 2

Weighted average common

shares outstanding 2

related party amounts of Nil

for the three months ended June 30,

2026, and 2025, respectively and Nil

for the six months ended June 30,

2026, and 2025, respectively.

have been adjusted to reflect the 1-for-10 reverse stock split that became effective on September 8, 2025.

3 unchanged sentences

and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

amounts in USD, except number of shares)

three months ended March 31, 2025

For Six months ended June 30, 2026

Stockholder’s

Balance as at

December 31, 2024

Balance as at December 31, 2025

$ ( 68,342,584 )

3 unchanged sentences

Stock based compensation (Note 5)

Transfer from early exercised stock option

liability on vesting

Transfer from early exercised stock option liability on vesting

Issuance of common stock

Issuance of common stock and warrants from

January 2025 public offering, net of offering costs

Issuance of common stock for settlement of

Issuance of common stock upon warrant inducement,

net of offering costs

Repurchase of unvested early exercised common

as at March 31, 2025

Issuance of common stock for settlement of RSU

Issuance of common stock for settlement of accrued liability

Balance as at March 31, 2026

$ ( 73,577,276 )

$ ( 7,867,665 )

three months ended March 31, 2026

Total Stockholder’s

Balance as at

December 31, 2025

$ ( 73,577,276 )

3 unchanged sentences

Stock based compensation (Note 5)

Transfer from early exercised stock option

liability on vesting

Stock based compensation

Transfer from early exercised stock option liability on vesting

Issuance of common stock

Issuance of common stock for settlement of

Issuance of common stock for settlement of accrued liability

Issuance of common stock pursuant to at-the-market offering, net of issuance costs (Note 4)

Issuance of common stock pursuant to at-the-market offering, net of issuance costs

Issuance of common stock for settlement of RSU

Issuance of common stock to vendor (Note 4)

Issuance of common stock for partial repayment of 2025 convertible note

Balance as at June 30, 2026

( 77,480,170 )

( 8,240,860 )

( 77,480,170 )

( 8,240,860 )

the six months ended June 30, 2025

Stockholders’

as at December 31, 2024

( 52,618,948 )

( 19,385,784 )

( 3,809,700 )

from early exercised stock option liability on vesting

based compensation (Note 5)

of common stock

of common stock and warrants from January 2025 public offering, net of offering costs

of common stock upon warrant inducement, net of offering costs

of unvested early exercised common stock

of common stock for settlement of RSU

as at March 31, 2025

1 unchanged sentence

$ ( 12,835,162 )

have been adjusted to reflect the 1-for-10 reverse stock split that became effective on September 8, 2025.

See Note 2 “Basis

of presentation and summary of significant accounting policies” for additional details.

( 3,704,438 )

from early exercised stock option liability on vesting

based compensation (Note 5)

of common stock (Note 4)

of common stock

of common stock to short- term loan holders (Note 13)

of common stock to short- term loan holders

of common stock to PIPE investors (Note 4)

of common stock to PIPE investors

of common stock to vendor

of common stock under license arrangement (Note 4)

of common stock under license arrangement

of common stock for settlement of RSU

of common stock from public offering, net of offering costs

as at June 30, 2025

$ ( 60,133,086 )

$ ( 3,887,464 )

Amounts have been adjusted

to reflect the 1-for-10 reverse stock split that became effective on September 8, 2025.

See Note 2 “Basis of presentation and summary

of significant accounting policies” for additional details.

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

2 unchanged sentences

amounts in USD)

Cash flows from operating

June 30, 2026

June 30, 2025

Cash flows from operating activities:

$ ( 9,137,586 )

$ ( 7,514,138 )

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

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Stock based compensation

Change in fair value of

investment in equity securities

Amortization of debt discount

and debt issuance cost

Loss from change in fair

value of common stock make-whole obligation

Change in fair value of

warrant liability

Non-cash marketing expense for stock issued to vendor

Amortization of debt discount and debt issuance costs

Change in fair value of common stock make-whole obligation

Loss on sale of investments in equity securities

Change in fair value of investment in equity securities

Loss on extinguishment of liability, net

Loss on write-off of promissory note and deposit

Deferred transaction cost expensed

Change in fair value of warrant liability

( 2,171,692 )

Change in fair value of

sponsor earnout shares

Non-cash marketing expense for proposed stock issuance to vendor

Gain on extinguishment of liability

Change in fair value of sponsor earnout shares

Depreciation expense

Deferred transaction costs expensed

Changes in operating assets

and liabilities:

Prepaid expenses and other

Amortization of operating lease right-of-use asset

Changes in operating assets and liabilities:

Prepaid expenses and other assets

Accounts payable

liabilities and other current liabilities

cash used in operating activities

Accrued liabilities and other liabilities

Operating right of use asset and liability

Net cash used in operating activities

$ ( 4,002,652 )

$ ( 4,490,450 )

Cash flows from investing

Cash flows from investing activities:

Capital project costs

( 2,278,760 )

Land acquisition cost

of property and equipment

cash used in investing activities

Proceeds from sale of investment in equity securities

Purchase of computer and equipment

Net cash used in investing activities

$ ( 194,312 )

$ ( 2,217,068 )

Cash flows from financing

Proceeds from issuance

of common stock

Deferred transaction costs

Repayment of short-term

loan from related parties

Cash flows from financing activities:

Proceeds from issuance of common stock

Proceeds from issuance of notes payable to related parties

Repayment of notes payable to related parties

Repayment of short-term loan from related parties

( 2,000,000 )

Repayment of short-term

Repayment of short-term loan

( 1,808,552 )

Proceeds from advance received

from PIPE investors

Proceeds from public offering

Proceeds from warrant inducement

Transaction costs associated

with public offering and warrant inducement

cash (used in) provided by financing activities

Net (decrease)/ increase

Proceeds from advance received from PIPE investors

Deferred transaction costs paid

Proceeds from public offerings

Proceeds from warrant inducement exercises

Transaction costs associated with public offerings and warrant inducement

( 1,252,152 )

Cash at the beginning

of the period

at the end of the period

Supplemental disclosure

for cash flow information:

Repurchase of unvested shares

Net cash provided by financing activities

Net (decrease)/ increase in cash

$ ( 2,939,887 )

Cash at the beginning of the period

Cash at the end of the period

Supplemental disclosure for cash flow information:

Interest paid

Supplemental disclosure

of non-cash investing and financing activities:

Unpaid capital project

Unpaid property and equipment

purchase cost

Reclass of advances to

capital project costs

Unpaid public offering

issuance cost

Unpaid warrant inducement

issuance costs

Unpaid amount for repurchase

of unvested shares

Pending stock issuance

under licensing arrangement

Incremental fair value

of warrant inducement

Fair value of common stock issued to settle accrued liability

Supplemental disclosure of non-cash investing and financing activities:

Unpaid capital project costs

Unpaid property and equipment purchase cost

Fair value of common stock issued to settle accrued bonus

Operating right of use asset obtained in exchange for new lease liability

Common stock issued for partial repayment of 2025 convertible note

Unpaid at-the-market offering costs

Reclass of advances to capital project costs

Unpaid public offering issuance cost

Unpaid warrant inducement issuance cost

Incremental fair value of warrant inducement

Issuance of common stock to short- term loan holders

Issuance of common stock to PIPE investors

Issuance of common stock to vendor

Issuance of common stock under license arrangement

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

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1 – DESCRIPTION OF THE COMPANY

(the “ Company ” or “ Stardust Power ”), formerly known as Global Partner Acquisition

Corp II (“ GPAC II ”), a Delaware corporation, is an American developer of battery grade lithium products, designed to foster energy independence

in the United States.

While the Company has not earned any revenue yet, the Company is in the process of developing a strategically

central, lithium refinery capable of producing up to 50,000 metric

tons per annum of battery grade lithium.

(the “ Company ” or “ Stardust Power ”), formerly known as Global Partner Acquisition Corp

II (“ GPAC II ”), a Delaware corporation, is an American developer of battery grade lithium products, designed to foster

energy independence in the United States.

While the Company has not earned any revenue yet, the Company is in the process of developing

a strategically central, lithium refinery capable of producing up to 50,000

metric tons per annum of battery grade lithium.

2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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Securities and Exchange Commission (the “ SEC ”) regarding interim financial reporting.

the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring

adjustments (which consist primarily of accruals, estimates and assumptions that impact the unaudited condensed consolidated

financial statements) considered necessary to present fairly the Company’s unaudited condensed consolidated balance sheet as

of March 31, 2026, its unaudited condensed consolidated statements of operations and stockholders’ deficit for the three

months ended March 31, 2026 and March 31, 2025, and its unaudited condensed consolidated statements of cash flows for the three

months ended March 31, 2026 and March 31, 2025.

Certain information and note disclosures normally included in the financial

statements prepared in accordance with U.S.

GAAP have been condensed or omitted pursuant to such rules and regulations.

information included in this report should be read in conjunction with the audited consolidated financial statements and notes

thereto of Stardust Power for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K filed with

the SEC on March 25, 2026 (the “ Form 10-K ”) , which provides a more complete discussion of the Company’s accounting policies and certain other

The accompanying condensed consolidated balance sheet as of December 31, 2025, has been derived from the audited

consolidated balance sheet as of December 31, 2025, contained in the above referenced Form 10-K.

the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring adjustments

(which consist primarily of accruals, estimates and assumptions that impact the unaudited condensed consolidated financial statements)

considered necessary to present fairly the Company’s unaudited condensed consolidated balance sheet as of June 30, 2026, its unaudited

condensed consolidated statements of operations and stockholders’ deficit for the three and six months ended June 30, 2026 and

June 30, 2025, and its unaudited condensed consolidated statements of cash flows for the six months ended June 30, 2026 and June 30,

Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S.

been condensed or omitted pursuant to such rules and regulations.

As such, the information included in this report should be read in

conjunction with the audited consolidated financial statements and notes thereto of Stardust Power for the year ended December 31, 2025

included in the Company’s Annual Report on Form 10-K filed with the SEC on March 25, 2026 (the “ Form 10-K ”),

which provides a more complete discussion of the Company’s accounting policies and certain other information.

The accompanying

condensed consolidated balance sheet as of December 31, 2025, has been derived from the audited consolidated balance sheet as of December

31, 2025, contained in the above referenced Form 10-K.

unaudited condensed consolidated financial statements include the accounts of Stardust Power Inc.

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that affect the amounts reported and disclosed in the unaudited condensed consolidated financial statements and accompanying notes.

estimates and assumptions include, but are not limited to, useful life of assets, realization of deferred tax assets, and fair valuation

of stock-based compensation, common shares purchase agreement, warrants, convertible notes, and sponsor earnout shares.

The Company evaluates

estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions

when facts and circumstances dictate.

As future events and their effects cannot be determined with precision, actual results could differ

from these estimates, and those differences could be material to the unaudited condensed consolidated financial statements.

estimates and assumptions include, but are not limited to, useful life of assets, realization of deferred tax assets, the incremental

borrowing rate for determining operating lease assets and liabilities and fair valuation of stock-based compensation, common shares purchase

agreement, warrants, convertible notes, and sponsor earnout shares.

The Company evaluates estimates and assumptions on an ongoing basis

using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate.

events and their effects cannot be determined with precision, actual results could differ from these estimates, and those differences

could be material to the unaudited condensed consolidated financial statements.

Growth Company

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until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a

class of securities registered under the Securities Exchange Act of 1934 (the “ Exchange Act ”)) are required to comply

class of securities registered under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)), are required to comply

with the new or revised financial accounting standards.

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or revised standard at the time private companies adopt the new or revised standard.

September 8, 2025, the Company effected a 1-for-10

reverse stock split (the “ Reverse

Stock Split ”) of the Company’s common stock, par value $ 0.0001 per share (“ Common Stock ”).

result of the Reverse Stock Split, every 10 shares of the Company’s Common Stock issued and outstanding were automatically

converted into one new share of Common Stock.

Proportionate adjustments were also made to (i) the exercise prices, and the number of

shares underlying the Company’s outstanding equity awards, as applicable, (ii) the number of shares issuable under the

Company’s equity incentive plans and certain existing agreements, and (iii) the number of shares purchasable upon exercise,

and/or the exercise prices, of the Company’s outstanding warrants to purchase shares of the Company’s Common Stock.

Reverse Stock Split did not decrease the number of authorized shares of Common Stock and preferred stock or otherwise affect the par

value of the Common Stock.

No fractional shares were issued in connection with the Reverse Stock Split and any fractional shares

resulting from the Reverse Stock Split were rounded down to the nearest whole share.

Stockholders who were otherwise entitled to

receive fractional shares as a result of the Reverse Stock Split were paid cash in lieu thereof.

All shares of the Company’s

Common Stock, per-share data and related information included in the accompanying unaudited condensed consolidated financial

statements have been retroactively adjusted as though the Reverse Stock Split had been effected prior to all periods

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 8, 2025, the Company effected a 1-for-10 reverse stock split (the “ Reverse Stock Split ”) of the Company’s

common stock, par value $ 0.0001 per share (“ Common Stock ”).

As a result of the Reverse Stock Split, every 10 shares

of the Company’s Common Stock issued and outstanding were automatically converted into one new share of Common Stock.

Proportionate

adjustments were also made to (i) the exercise prices, and the number of shares underlying the Company’s outstanding equity awards,

as applicable, (ii) the number of shares issuable under the Company’s equity incentive plans and certain existing agreements, and

(iii) the number of shares purchasable upon exercise, and/or the exercise prices, of the Company’s outstanding warrants to purchase

shares of the Company’s Common Stock.

The Reverse Stock Split did not decrease the number of authorized shares of Common Stock

and preferred stock or otherwise affect the par value of the Common Stock.

No fractional shares were issued in connection with the Reverse

Stock Split and any fractional shares resulting from the Reverse Stock Split were rounded down to the nearest whole share.

who were otherwise entitled to receive fractional shares as a result of the Reverse Stock Split were paid cash in lieu thereof.

of the Company’s Common Stock, per-share data and related information included in the accompanying unaudited condensed consolidated

financial statements have been retroactively adjusted as though the Reverse Stock Split had been effected prior to all periods presented.

Company’s unaudited condensed consolidated financial statements have been presented on the basis that it is a going concern, which

contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

As of March 31, 2026, the Company has $ 1,235,564 of unrestricted cash.

The Company is a development stage entity

having no revenues and has incurred a net loss of $ 5,234,692 and $ 3,809,700 for the three months ended March 31, 2026, and 2025, respectively.

The Company has an accumulated deficit of $ 73,577,276 and stockholders’ deficit of $ 7,867,665 as of March 31, 2026.

expects to continue to incur significant costs in pursuit of its operating and investment plans.

These costs exceed the Company’s

existing cash balance and net working capital.

of June 30, 2026, the Company has $ 540,264 of unrestricted cash.

The Company is a development stage entity having no revenues and has

incurred a net loss of $ 3,902,894 and $ 9,137,586 for the three and six months ended June 30, 2026, respectively.

The Company has an accumulated

deficit of $ 77,480,170 and stockholders’ deficit of $ 8,240,860 as of June 30, 2026.

The Company expects to continue to incur significant

costs in pursuit of its operating and investment plans.

These costs exceed the Company’s existing cash balance and net working

These conditions raise substantial doubt about its ability to continue as a going concern.

December 23, 2025, the Company entered into a Securities Purchase Agreement (the “ Lind Securities Purchase Agreement ”)

with Lind Global Asset Management XIII LLC (“ Lind ”) providing for up to $ 15,000,000 in senior secured convertible

debt financing.

Simultaneously, the Company initially drew down gross proceeds of $ 4,000,000 in exchange for issuance to

Lind of a Senior Secured Convertible Promissory Note in the amount of $ 4,800,000 (the “ 2025 Convertible Note ”) and

a Common Stock Purchase Warrant, for the purchase of approximately 411,245 shares.

(the “ Lind Warrant Shares ”).

deducting a commitment fee of $ 100,000 and other transaction-related costs, the Company received net cash proceeds of $ 3,792,500

December 23, 2025, the Company entered into a Securities Purchase Agreement (the “ Lind Securities Purchase

Agreement ”) with Lind Global Asset Management XIII LLC (“ Lind ”) providing for up to $ 15,000,000

in senior secured convertible debt financing.

Simultaneously, the Company initially drew down gross proceeds of $ 4,000,000

in exchange for issuance to Lind of a Senior Secured Convertible Promissory Note in the amount of $ 4,800,000

(the “ 2025 Convertible Note ”) and a Common Stock Purchase Warrant (the “ 2025 Lind Warrant ”) , for the purchase of approximately 411,245

shares (the “ Lind Warrant Shares ”).

After deducting a commitment fee of $ 100,000

and other transaction-related costs, the Company received net cash proceeds of $ 3,792,500

(See Note 8).

1 unchanged sentence

Riley Purchase Agreement ”)

and a related Registration Rights Agreement (the “ B.

Riley Registration Rights Agreement ”, and together with the

Riley Purchase Agreement, the “ B.

Riley Agreements ”) with B.

Riley Principal Capital II, LLC (“ B.

Riley Principal Capital II ”), the selling stockholder.

Upon the terms and subject to the satisfaction of the conditions set

forth in the B.

Riley Purchase Agreement, the Company will have the right, in its sole discretion, to sell up to $ 10,000,000 of

Common Stock to B.

terms and subject to the satisfaction of the conditions set forth in the B.

Riley Purchase Agreement, the Company will have the

right, in its sole discretion, to sell up to $ 10,000,000

of Common Stock to B.

Riley Principal Capital II, subject to certain conditions and limitations contained in the B.

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shares of Common Stock aggregating to net proceeds of $ 1,310,904

(See Note 4).

to the quarter end, the Company entered into an At Market Issuance Sales Agreement (the “Sales Agreement”) with B.

under this arrangement (See Note 4).

May 8, 2026, the Company entered into an At Market Issuance Sales Agreement (the “ Sales Agreement ”) with B.

Securities, Inc.

(the “ Agent ”).

Pursuant to the terms of the Sales Agreement, the Company may sell from time to

time through the Agent, shares of the Company’s common stock, par value $ 0.0001 per share, having an aggregate offering price of

up to $ 5,000,000 (the “Shares”).

The Company intends to use this facility to raise capital as needed.

of the date on which these unaudited condensed consolidated financial statements were available to be issued, the Company believes that the cash

on hand, and additional investments available through issuance of new Common Stock, will be inadequate to satisfy the Company’s

Pursuant to the terms of the Sales Agreement, the Company may sell from time to time

through the Agent, shares of the Company’s common stock, par value $ 0.0001

per share (the “ Placement Shares ”), having

an aggregate offering price of up to $ 5,000,000

(the “ ATM Offering ”).

The Company intends

to use this facility to raise capital as needed.

As of the date of this filing, the Company has issued 2,159,867

Placement shares of Common Stock aggregating to net proceeds

of $ 3,112,021

under this arrangement (See Note 4).

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

of the date on which these unaudited condensed consolidated financial statements were available to be issued, the Company believes that

the cash on hand, and additional investments available through issuance of new Common Stock, will be inadequate to satisfy the Company’s

working capital and capital expenditure requirements for at least the next twelve months.

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might be necessary should the Company be unable to continue as a going concern.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

of Significant Accounting Policies

4 unchanged sentences

Company adopted Accounting Standard Codification (“ ASC ”) 260, “Earnings per Share” , at its inception.

Basic net loss per share is calculated by dividing

the net loss by the weighted average number of Common Stock outstanding for the period.

Diluted loss per share is calculated by dividing

the Company’s net loss available to common stockholders by the diluted weighted average number of shares outstanding for the period.

The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as at the first of the year

for any potentially dilutive debt or equity.

Potential common shares from unvested restricted stock options, earnouts and common stock

warrants are computed using the treasury stock method.

Contingently issuable shares are included in basic EPS only when there is no circumstance

under which those shares would not be issued.

Basic net loss per share is calculated by dividing the net loss by the weighted average number of Common Stock outstanding for the period.

Diluted loss per share is calculated by dividing the Company’s net loss available to common stockholders by the diluted weighted

average number of shares outstanding for the period.

The diluted weighted average number of shares outstanding is the basic weighted

number of shares adjusted as at the first of the year for any potentially dilutive debt or equity.

Potential common stock from unvested

restricted stock options, earnouts and common stock warrants are computed using the treasury stock method.

Contingently issuable shares

are included in basic EPS only when there is no circumstance under which those shares would not be issued.

following table sets forth the computation of the basic and diluted net loss per share:

SCHEDULE OF BASIC AND DILUTED NET LOSS PER SHARE

June 30, 2026

June 30, 2025

June 30, 2026

June 30, 2025

Three months ended

Six months ended

June 30, 2026

June 30, 2025

June 30, 2026

June 30, 2025

$ ( 3,902,894 )

$ ( 3,704,438 )

Weighted average shares

loss per share, basic and diluted

$ ( 9,137,586 )

$ ( 7,514,138 )

Weighted average shares outstanding

Net loss per share, basic and diluted

following potentially dilutive shares were excluded from the computation of diluted net loss per share attributable to common stockholders

1 unchanged sentence

SCHEDULE OF ANTI-DILUTIVE EFFECT

June 30, 2026

June 30, 2025

Restricted Stock options

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Private placement warrants

2025 Convertible note shares

2025 Convertible note warrants

2025 Convertible notes shares

2025 Convertible notes warrants

Potentially dilutive shares

Sponsor Earnout Shares (as defined in the Business Combination Agreement) were not included for purposes of calculating the number

of diluted shares outstanding as of March 31, 2026, as the Sponsor Earnout Shares remain contingently forfeitable, as the conditions

of diluted shares outstanding as of June 30, 2026, as the Sponsor Earnout Shares remain contingently forfeitable, as the conditions

have not been met.

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issuance costs consist of expenditures associated with obtaining debt financing, principally legal and commitment fees.

are deferred and amortized over the term of the related credit arrangements using a method that approximates the effective interest

Debt issuance costs are included in the unaudited condensed consolidated balance sheets as a direct deduction from the

carrying amount of long-term debt and are included in Interest expense in the unaudited condensed consolidated statements of

The payment of debt issuance costs will be recorded under financing activities in the unaudited condensed consolidated

statements of cash flows.

Such costs are

deferred and amortized over the term of the related credit arrangements using a method that approximates the effective interest method.

Debt issuance costs are included in the unaudited condensed consolidated balance sheets as a direct deduction from the carrying amount

of long-term debt and are included in Interest expense in the unaudited condensed consolidated statements of operations.

of debt issuance costs will be recorded under financing activities in the unaudited condensed consolidated statements of cash flows.

Project Costs and Property and Equipment, Net

Company capitalizes costs incurred in connection with the development and construction of its planned lithium refinery in Muskogee,

Oklahoma (the “ Facility ”), in accordance with ASC 360, Property, Plant, and Equipment .

costs include expenditures that are directly attributable to the acquisition, development, and construction of the Facility,

including land acquisition costs, permitting costs, engineering, front-end loading (“ FEL ”) studies, environmental

studies, and other costs necessary to prepare the asset for its intended use.

Company capitalizes costs incurred in connection with the development and construction of its planned lithium refinery in Muskogee, Oklahoma

(the “ Facility ”), in accordance with ASC 360, Property, Plant, and Equipment .

Capitalized costs include

expenditures that are directly attributable to the acquisition, development, and construction of the Facility, including land acquisition

costs, permitting costs, engineering, front-end loading (“ FEL ”) studies, environmental studies, and other costs necessary

to prepare the asset for its intended use.

incurred during the preliminary project stage that are not directly attributable to the construction of the Facility are expensed as

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orderly transaction between market participants at the measurement date.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Accounting Pronouncements

2 unchanged sentences

The Company has reviewed the

accounting pronouncements issued during the three months ended March 31, 2026, and concluded they were either not applicable or not expected

accounting pronouncements issued during the six months ended June 30, 2026, and concluded they were either not applicable or not expected

to have a material impact on the Company’s unaudited condensed consolidated financial statements.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

3 - COMMITMENTS AND CONTINGENCIES

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February 7, 2025 (the “ License Agreement Effective Date ”), the Company executed an exclusive license agreement (the

“ License Agreement ”) with KMX Technologies, Inc.

a Delaware corporation (“ KMX ”).

“ License Agreement ”) with KMX Technologies, Inc., a Delaware corporation (“ KMX ”).

Under the terms

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on the terms and conditions set forth therein.

October 20, 2025, the Company entered into a non-binding letter agreement with Prairie Lithium Limited

(“ Prairie ”), an Australia-based company, for the supply of 6,000 metric

tons per annum of lithium carbonate equivalent (“ LCE ”) in the form of lithium chloride.

The lithium chloride is

sourced from the Prairie Lithium Project in Saskatchewan, Canada and will be used as feedstock at the Facility.

The initial contract term would

starting from the date on which first commercial shipment is received by the Company, with the option for the Company to renew for

two additional six year terms.

October 20, 2025, the Company entered into a non-binding letter agreement with Prairie Lithium Limited (“ Prairie ”),

an Australia-based company, for the supply of 6,000 metric tons per annum of lithium carbonate equivalent (“ LCE ”)

in the form of lithium chloride.

The lithium chloride is sourced from the Prairie Lithium Project in Saskatchewan, Canada and will be

used as feedstock at the Facility.

The initial contract term would span 6 years starting from the date on which the first commercial shipment is received by the Company, with the option for the Company to renew for two additional

six-year terms.

October 31, 2025, the Company entered into a non-binding letter agreement with Mandrake Resources Limited (“ Mandrake ”),

an Australia-based company, for the supply of 7,500

metric tons per annum of LCE in the form of lithium chloride.

The initial contract term would span 12

years starting from the date on which first commercial shipment

is received by the Company, with the option for the Company to renew for an additional six-year term.

March 13, 2026, the Company entered into a non-binding letter agreement with a strategic counterparty for the supply of 15,000

metric tons per annum of LCE in the form of lithium chloride.

The initial contract term would span 12

years starting from the date on which first commercial shipment

is received by the Company, with the option for the Company to renew for an additional six-year term.

an Australia-based company, for the supply of 7,500 metric tons per annum of LCE in the form of lithium chloride.

The initial contract

term would span 12 years starting from the date on which first commercial shipment is received by the Company, with the option for the

Company to renew for an additional six-year term.

March 13, 2026, the Company entered into a non-binding letter agreement with a strategic counterparty for the supply of 15,000 metric

tons per annum of LCE in the form of lithium chloride.

The initial contract term would span 12 years starting from the date on which

first commercial shipment is received by the Company, with the option for the Company to renew for an additional six-year term.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

From time to time, the Company may be involved in

certain legal and regulatory proceedings, as well as demands, investigations and claims that arise in the ordinary course of its business.

The ultimate outcome of any litigation is often uncertain, and unfavorable outcomes could have a negative impact on the Company’s

results of operations and financial condition.

The Company makes a provision for a liability relating to legal matters when it is probable

that a liability has been incurred and the amount of the loss can be reasonably estimated.

These provisions are reviewed at least quarterly

and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information

and events pertaining to a particular matter.

In the Company’s opinion, resolution of any pending claims (either individually or

in the aggregate) is not expected to have a material adverse impact on the Company’s consolidated results of operations, cash flows

or financial position, nor is it possible to provide an estimated amount of any such loss.

However, depending on the nature and timing

of any such dispute, an unfavorable resolution of a matter could materially affect the Company’s future financial position, results

of operations, or cash flows, or all in a particular period.

time to time, the Company may be involved in certain legal and regulatory proceedings, as well as demands, investigations and claims

that arise in the ordinary course of its business.

The ultimate outcome of any litigation is often uncertain, and unfavorable outcomes

could have a negative impact on the Company’s results of operations and financial condition.

The Company makes a provision for

a liability relating to legal matters when it is probable that a liability has been incurred and the amount of the loss can be reasonably

These provisions are reviewed at least quarterly and adjusted to reflect the impact of negotiations, estimated settlements,

legal rulings, advice of legal counsel and other information and events pertaining to a particular matter.

In the Company’s opinion,

resolution of any pending claims (either individually or in the aggregate) is not expected to have a material adverse impact on the Company’s

consolidated results of operations, cash flows or financial position, nor is it possible to provide an estimated amount of any such loss.

However, depending on the nature and timing of any such dispute, an unfavorable resolution of a matter could materially affect the Company’s

future financial position, results of operations, or cash flows, or all in a particular period.

July 7, 2025, a complaint was filed in the Supreme Court of the State of New York, County of New York, captioned H.C.

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4 – COMMON STOCK

July 8, 2024, the Common Stock and warrants began trading on Nasdaq under the ticker symbols “SDST” and “SDSTW”,

respectively.

July 8, 2024, the Common Stock and Public Warrants began trading on Nasdaq under the ticker symbols “SDST” and

“SDSTW”, respectively.

share of Common Stock is entitled to one vote.

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condensed consolidated statement of stockholders’ deficit includes shares related to restricted stock that are subject to repurchase.

Company is authorized to issue 700,000,000 and 100,000,000 shares, par value of $ 0.0001 per share, of Common Stock and Preferred stock,

respectively.

At March 31, 2026, the Company had 9,966,473 shares of Common Stock issued and outstanding.

Not reflected in the shares

issued and outstanding as of March 31, 2026, is approximately 707,054 shares of Common Stock related to shares issued to a vendor and

restricted stock units that vested during the three months ended March 31, 2026, but have not yet been settled and issued.

Company is authorized to issue 700,000,000

and 100,000,000

shares, par value of $ 0.0001

per share, of Common Stock and Preferred Stock, respectively.

At June 30, 2026, the Company had 11,628,657

shares of Common Stock issued and outstanding.

As of December

31, 2025, the Company had 9,869,558 shares of Common Stock, par value $ 0.0001 , issued and outstanding.

31, 2025, the Company had 9,869,558

shares of Common Stock issued and outstanding.

Earnout Shares

part of the closing of the Business Combination, the Company issued 100,000 shares to Global Partner Sponsor II, LLC (the “ Sponsor ”).

These shares are subject to vesting (or forfeiture) based on achieving certain trading price thresholds following the closing (“ Sponsor

Earnout Shares ”).

Fifty percent of the Sponsor Earnout Shares will vest when the Volume-Weighted Average Price (“ VWAP ”)

of the Common Stock price equals or exceeds $ 120.00 per share for a period of 20 trading days in a 30 trading day period, and the remaining

fifty percent of the Sponsor Earnout Shares will vest when the VWAP of the Common Stock price equals or exceeds $ 140.00 per share for

a period of 20 trading days in a 30 trading day period.

There are no service conditions or any requirement for the participants to provide

goods or services in order to vest in the Sponsor Earnout Shares.

Accordingly, the Company determined that the Sponsor Earnout Shares

are not within the scope of ASC 718.

The accounting for the Sponsor Earnout Shares was evaluated under ASC Topic 480, “ Distinguishing

Liabilities from Equity ”, and ASC Subtopic 815-40, “ Derivatives and Hedging — Contracts in Entity’s Own

Equity ” (“ ASC 815-40 ”), to determine if the Sponsor Earnout Shares should be classified as a liability or

within equity.

As part of the analysis, it was determined that the Sponsor Earnout Shares subject to vesting are freestanding from other

shares of Combined Company Common Stock held by the Sponsor and do not meet the criteria in ASC 815-40 to be considered indexed to the

Combined Company Common Stock, due to the settlement provisions including a change in control component which could impact the number

of the Sponsor Earnout Shares that are ultimately settled for, which is not an input to a fixed-for-fixed option pricing model.

result, the Sponsor Earnout Shares were classified as a liability.

Subsequent changes in the fair value of the Sponsor Earnout Shares

will be reflected in the unaudited condensed consolidated statement of operations.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Earnout Shares

part of the closing of the Business Combination, the Company issued 100,000 shares to Global Partner Sponsor II, LLC (the

“ Sponsor ”).

These shares are subject to vesting (or forfeiture) based on achieving certain trading price

thresholds following the closing (“ Sponsor Earnout Shares ”).

Fifty percent of the Sponsor Earnout Shares will

vest when the Volume-Weighted Average Price (“ VWAP ”) of the Common Stock price equals or exceeds $120.00 per

share for a period of 20 trading days in a 30 trading day period, and the remaining fifty percent of the Sponsor Earnout Shares will

vest when the VWAP of the Common Stock price equals or exceeds $140.00 per share for a period of 20 trading days in a 30 trading day

There are no service conditions or any requirement for the participants to provide goods or services in order to vest in the

Sponsor Earnout Shares.

Accordingly, the Company determined that the Sponsor Earnout Shares are not within the scope of ASC 718.

accounting for the Sponsor Earnout Shares was evaluated under ASC Topic 480, “ Distinguishing Liabilities from

Equity ”, and ASC Subtopic 815-40, “ Derivatives and Hedging — Contracts in Entity’s Own

Equity ” (“ ASC 815-40 ”), to determine if the Sponsor Earnout Shares should be classified as a liability

or within equity.

As part of the analysis, it was determined that the Sponsor Earnout Shares subject to vesting are freestanding

from other shares of Combined Company Common Stock held by the Sponsor and do not meet the criteria in ASC 815-40 to be considered

indexed to the Combined Company Common Stock, due to the settlement provisions including a change in control component which could

impact the number of the Sponsor Earnout Shares that are ultimately settled for, which is not an input to a fixed-for-fixed option

pricing model.

As a result, the Sponsor Earnout Shares were classified as a liability.

Subsequent changes in the fair value of the

Sponsor Earnout Shares will be reflected in the unaudited condensed consolidated statement of operations.

the occurrence of a change in control, any remaining unvested Sponsor Earnout Shares become vested.

Unvested Sponsor Earnout Shares will

be forfeited if vesting does not occur prior to the eighth anniversary of the Closing Date.

The Company assesses the fair value of expected

earnout consideration at each reporting period using the Monte Carlo Method, which is consistent with the initial measurement of the

expected earnout consideration.

The Company did not perform a fair valuation of expected earnout consideration using the Monte Carlo

method as of December 31, 2025, as the Company determined that change in fair value is deemed immaterial to the fair value of earnout

consideration.

As at March 31, 2026 and December 31, 2025, the fair value of Sponsor Earnout Shares amounted to $ 4,700 .

Sponsor Earnout Shares were valued using the following assumptions under the Monte Carlo Model that assumes optimal exercise of the Company’s

redemption option at the earliest possible date:

OF ASSUMPTIONS UNDER THE MONTE CARLO MODEL

Market price of public stock

Expected term (years)

Risk-free interest rate

Dividend rate

Unvested Sponsor Earnout Shares

will be forfeited if vesting does not occur prior to the eighth anniversary of the Closing Date.

The Company assesses the fair value

of expected earnout consideration at each reporting period using the Monte Carlo Method, which is consistent with the initial

measurement of the expected earnout consideration.

As at June 30, 2026 and December 31, 2025, the Company did not identify any

indicators that a change in the fair value of the Sponsor Earnout Shares last measured at $ 4,700

as of March 31, 2025, would be material, and accordingly did not perform an updated Monte Carlo valuation as of either

Stock Purchase Agreement

On October 7, 2024, the Company

entered into a common stock purchase agreement and a related registration rights agreement with B.

Riley Principal Capital II (the

Riley Agreements”), pursuant to which the Company could have, at its sole discretion and subject to certain

conditions and limitations (including 4.99% beneficial ownership limitation) , sold up to the lesser of $ 50.0

million of its Common Stock or the applicable Exchange Cap (19.99% of the common shares outstanding immediately prior to execution

of the Prior B.

Riley Agreements) during the 36-month term of the Prior B.

October 7, 2024, the Company entered into a common stock purchase agreement and a related registration rights agreement with B.

Principal Capital II (the “ Prior B.

Riley Agreements ”), pursuant to which the Company could have, at its sole discretion

and subject to certain conditions and limitations (including 4.99% beneficial ownership limitation), sold up to the lesser of $ 50.0

million of its Common Stock or the applicable Exchange Cap

(19.99% of the common shares outstanding immediately prior to execution of the Prior B.

Riley Agreements) during the 36-month term of

Riley Agreements.

The purchase price of shares is based on the VWAP of

the Company’s Common Stock on the applicable purchase date, less a fixed 3% discount.

In connection with the Prior B.

Agreements, the Company issued 6,369

shares of Common Stock as commitment shares to B.

Riley Principal Capital II with a grant date fair value of $ 500,000 ,

which was recorded as a component of finance charges in the consolidated statements of operations for the year ended December 31, 2024.

Riley Agreements also provided for a make-whole mechanism whereby, if B.

Riley Principal Capital II’s aggregate resale

proceeds from the commitment shares were less than $ 500,000 ,

the Company would pay the shortfall in cash, and if the resale proceeds exceeded $ 500,000 ,

Riley Principal Capital II would remit 50% of the excess to the Company.

As of March 31, 2025, the fair market value of the commitment

shares was $ 30,059 ,

resulting in a make-whole obligation of $ 469,941 .

The change in the fair value of the make-whole obligation of $ 197,930

was recognized as a component of finance charges in the unaudited condensed consolidated statements of operations for the three months

ended March 31, 2025.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The purchase price of shares is based on the VWAP of the Company’s Common Stock on the applicable

purchase date, less a fixed 3% discount.

connection with the Prior B.

Riley Agreements, the Company issued 6,369 shares of Common Stock as commitment shares to B.

Riley Principal

Capital II with a grant date fair value of $ 500,000 , which was recorded as a component of finance charges in the consolidated statements

of operations for the year ended December 31, 2024.

Riley Agreements also provided for a make-whole mechanism whereby, if

Riley Principal Capital II’s aggregate resale proceeds from the commitment shares were less than $ 500,000 , the Company would

pay the shortfall in cash, and if the resale proceeds exceeded $ 500,000 , B.

Riley Principal Capital II would remit 50% of the excess

to the Company.

As of June 30, 2025, the fair market value of the commitment shares was $ 12,546 , resulting in a make-whole obligation

of $ 487,454 .

The change in the fair value of the make-whole obligation of $ 17,513 and $ 215,443 was recognized as a component of finance

charges in the unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2025, respectively.

December 11, 2025, the Company entered into a letter agreement with B.

Riley Principal Capital II, pursuant to which the parties

mutually agreed to terminate the Prior B.

Riley Principal Capital II, pursuant to which the parties mutually

agreed to terminate the Prior B.

Riley Agreements.

As part of the termination, the Company agreed to satisfy the make-whole

payment as per the terms of the Prior B.

Riley Agreements of $ 471,942 ,

in three equal portions:

(i) through the issuance of restricted Common Stock priced at $ 4.40

per share and subject to resale registration, (ii) in cash upon the Company’s next equity or convertible financing, and (iii)

in connection with a future equity line, at-the-market program, or similar financing that the Company is currently working on with

the Investor or its affiliate, or otherwise in cash if unpaid by September 30, 2026.

As part of the termination, the Company agreed to satisfy the make-whole payment as

per the terms of the Prior B.

Riley Agreements of $ 471,942 , in three equal portions:

(i) through the issuance of restricted Common Stock

priced at $ 4.40 per share and subject to resale registration, (ii) in cash upon the Company’s next equity or convertible financing,

and (iii) in connection with a future equity line, at-the-market program, or similar financing that the Company is currently working

on with the Investor or its affiliate, or otherwise in cash if unpaid by September 30, 2026.

On December 15, 2025, the Company issued

35,753 shares of Common Stock (“ Settlement Shares ”) to B.

Riley Principal Capital II to satisfy one-third of the

make-whole payment as per the terms of the Agreement.

As of December 31, 2025, and March 31, 2026, the fair value of the Settlement

Shares was $ 109,405

and $ 84,378 ,

respectively, which was less than one-third of the make-whole obligation of $ 157,315 .

Accordingly, the Company recorded an accrual of $ 47,910

as of December 31, 2025, and an additional accrual of $ 25,027

for the three months ended March 31, 2026, representing the differential between the fair value of the Settlement Shares and

one-third of the make-whole obligation.

In January 2026, the Company made a cash payment of $ 157,314

to settle one-third of the make-whole obligation.

As of December 31, 2025 and March 31, 2026, the total make-whole obligation

balance was $ 362,538

and $ 230,251 ,

respectively, and is included in accrued expenses and other current liabilities in the accompanying condensed consolidated balance

The change in the fair value of the make-whole obligation of $ 25,027

is recorded as a component of finance charges in the accompanying unaudited condensed consolidated statements of operations for the

three months ended March 31, 2026.

Riley Principal Capital II to satisfy one-third of the make-whole

payment as per the terms of the Agreement.

As of December 31, 2025, and June 30, 2026, the fair value of the Settlement Shares was $ 109,405

and $ 55,776 , respectively, which was less than one-third of the make-whole obligation of $ 157,315 .

Accordingly, the Company recorded

an accrual of $ 47,910 as of December 31, 2025, and an additional accrual of $ 53,629 for the six months ended June 30, 2026, representing

the differential between the fair value of the Settlement Shares and one-third of the make-whole obligation.

In January 2026, the Company

made a cash payment of $ 157,314 to settle one-third of the make-whole obligation and in May 2026, the Company received an invoice for

the remaining one-third of the make-whole obligation of $ 157,314 and made a cash payment of $ 75,000 .

As of December 31, 2025 and June

30, 2026, the total make-whole obligation balance was $ 362,538 and $ 101,539 , respectively and is included in accrued expenses and other

current liabilities in the accompanying condensed consolidated balance sheets.

The change in the fair value of the make-whole obligation

of $ 28,602 and $ 53,629 is recorded as a component of finance charges in the accompanying unaudited condensed consolidated statements

of operations for the three and six months ended June 30, 2026.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

February 12, 2026, the Company entered into the B.

4 unchanged sentences

Riley Principal Capital II, from time to time during the 36-month investment period, up to $ 10,000,000

$ 10,000,000 of

newly issued shares of Common Stock (the “ Total Commitment ”), subject to the Exchange Cap (as defined below) and

of newly issued shares of Common Stock (the “ Total Commitment ”), subject to the Exchange Cap (as defined below) and

other conditions and limitations set forth in the agreement.

2 unchanged sentences

Riley Principal Capital II under the B.

Riley Agreements more than 1,972,924

shares of Common Stock, which represents 19.99 %

Riley Agreements more than 1,972,924 shares of Common Stock, which represents

19.99 % of the Common Stock outstanding immediately prior to the execution of the B.

Riley Agreements (the “ Exchange Cap ”).

In addition, B.

Riley Principal Capital II may not acquire shares under the B.

3 unchanged sentences

The Company evaluated the B.

Riley Agreements to determine whether they should be accounted for considering the guidance

in ASC 815-40 and concluded that it is an equity linked contract that does not qualify for equity classification and therefore requires

fair value accounting as a derivative.

The Company has analyzed the terms of the freestanding purchased put right and has concluded that

it had insignificant value as of March 31, 2026.

Riley Agreements to determine whether they should be accounted for considering the guidance in ASC 815-40

and concluded that it is an equity-linked contract that does not qualify for equity classification and therefore requires fair value

accounting as a derivative.

The Company has analyzed the terms of the freestanding purchased put right and has concluded that it had

insignificant value as of June 30, 2026.

purchase price of the shares of Common Stock to be sold under the B.

Riley Agreements, is determined by reference to the VWAP

of the Common Stock over specified VWAP or Intraday VWAP Purchase Periods on the applicable purchase dates, less a fixed 3% discount

to such VWAP, and subject to daily volume-based limits, the Exchange Cap, the Beneficial Ownership Limitation and a minimum Threshold

Price condition with terms as defined in the B.

Riley Agreements, is determined by reference to the VWAP of the

Common Stock over specified VWAP or Intraday VWAP Purchase Periods on the applicable purchase dates, less a fixed 3% discount to such

VWAP, and subject to daily volume-based limits, the Exchange Cap, the Beneficial Ownership Limitation and a minimum Threshold Price condition

with terms as defined in the B.

Riley Agreements.

1 unchanged sentence

Riley Agreements, the Company agreed to reimburse B.

Riley Principal Capital II for certain

fees and expenses, including (i) a Qualified Independent Underwriter (“ QIU ”) fee and initial legal fee

reimbursements payable at or around Closing and Commencement (as defined in the B.

Riley Agreements) and (ii) ongoing quarterly

legal fee reimbursements for B.

Riley Principal Capital II for certain fees

and expenses, including (i) a Qualified Independent Underwriter (“ QIU ”) fee and initial legal fee reimbursements payable

at or around Closing and Commencement (as defined in the B.

Riley Agreements) and (ii) ongoing quarterly legal fee reimbursements for

Riley Principal Capital II’s due-diligence and related matters.

The Company also agreed that a

fully earned, non-refundable Prior Transaction Cash Holdback Amount of $ 157,314 ,

relating to a prior terminated transaction with B.

Riley Principal Capital II, will be funded by allowing B.

Riley Principal Capital

II to withhold 10 %

of the gross purchase price on each VWAP or Intraday VWAP Purchase under the new facility until cumulative withholdings equal to

If the Company fails to pay in full this Prior Transaction Cash Holdback Amount on or before September 30, 2026, the Company will

also be obligated to pay B.

Riley Principal Capital II a one-time non-refundable commitment fee of up to $ 100,000 ,

in accordance with the terms of the B.

The Company also agreed that a fully earned, non-refundable

Prior Transaction Cash Holdback Amount of $ 157,314 , relating to a prior terminated transaction with B.

Riley Principal Capital II, will

be funded by allowing B.

Riley Principal Capital II to withhold 10 % of the gross purchase price on each VWAP or Intraday VWAP Purchase

under the new facility until cumulative withholdings equal to $ 157,314 .

If the Company fails to pay in full this Prior Transaction Cash

Holdback Amount on or before September 30, 2026, the Company will also be obligated to pay B.

Riley Principal Capital II a one-time non-refundable

commitment fee of up to $ 100,000 , in accordance with the terms of the B.

Riley Agreements.

In May 2026, the Company received an invoice

for the Holdback Amount of $ 157,314 and made a cash payment of $ 75,000 .

than shares that may be issued to B.

Riley Principal Capital II under this facility, the Company has issued and may continue to

issue additional shares of its Common Stock from time to time in separate transactions, which may result in further dilution to

existing stockholders.

During the three months ended March 31, 2026, the Company issued 29,067

shares of Common Stock aggregating to net proceeds of $ 94,193 .

Subsequent to quarter end, the Company issued 436,053 shares of Common

Stock aggregating to net proceeds of $ 1,125,821 .

Offering and Warrant Inducement

January 27, 2025, the Company consummated a public offering of 479,200

shares of Common Stock and accompanying warrants to purchase

up to 479,200

shares of Common Stock at a public offering price of $ 12.00

per share and warrant, generating aggregate gross proceeds

of $ 5,750,400

before offering expenses of $ 1,159,331 .

The common stock purchase warrants, exercisable at $ 13.00

per share and expiring five years from issuance, were issued

under an effective registration statement on Form S-1 (File No.

333-284298) filed by the Company with the SEC under the Securities Act

of 1933, as amended (the “ Securities Act ”) that became effective on January 23, 2025.

March 16, 2025, the Company entered into a letter agreement (the “Inducement Letter”) with a warrant holder (the

“Exercising Holder”) providing for the immediate cash exercise of outstanding warrants to purchase 479,200 shares

of the Company’s Common Stock at a reduced exercise price of $ 6.20 per

In order to further incentivize the early exercise of these outstanding warrants, the Company also agreed to issue new common

stock purchase warrants (the “Inducement Warrants”) to purchase up to 958,400 shares

of Common Stock at an exercise price of $ 7.00 per

share, subject to shareholder approval and Nasdaq rules.

Pursuant to the Inducement Letter, the warrant holders exercised the

outstanding warrants on March 18, 2025, and the Company received gross proceeds of $ 2,971,040 before

cash offering expenses of $ 172,841 .

Riley Principal Capital II under this facility, the Company has issued and may continue to issue

additional shares of its Common Stock from time to time in separate transactions, which may result in further dilution to existing stockholders.

the three and six months ended June 30, 2026, the Company issued 476,799 and 505,866 shares of Common Stock aggregating to net proceeds

of $ 1,216,711 and $ 1,310,904 , respectively.

At-the-Market

Issuance Sales Agreement

May 8, 2026, the Company entered into the Sales Agreement with the Agent, pursuant to which the Company may issue and sell the

Placement Shares from time to time, in its sole discretion, through the ATM Offering, through or to the Agent acting as sales agent or principal.

The ATM Offering is registered under

the Company’s shelf registration statement on Form S-3 (File No.

333-294938), which has been declared effective by the SEC.

The Company has filed a Prospectus Supplement specifically relating to the Placement Shares.

The Company is not obligated to sell

any shares under the Sales Agreement and may suspend or terminate the Sales Agreement at any time.

The Company’s ability to

raise capital through sales of Placement Shares under the Sales Agreement is subject to, among other things, the continued

effectiveness of the shelf registration statement and related Prospectus Supplement and market conditions, including the trading

price and trading volume of the Company’s common stock, and the Company may be unable to sell Placement Shares at times, or on

terms, that are acceptable to the Company.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 30, 2025, the Company entered into the Exchange Agreement with the Exercising Holder.

Pursuant to the Exchange Agreement, the

Exercising Holder agreed to irrevocably exchange all of its warrants to purchase shares of Common Stock, originally issued on March 16,

2025, representing the right to purchase an aggregate of 958,400

shares of Common Stock (the “ Warrant Shares ”),

for newly issued shares of Common

Stock at an exchange ratio of 1.31 Warrant Shares for 1 share of Common Stock ,

resulting in the issuance to the Exercising Holder of 730,689

shares of Common Stock at closing with no other payment or

any other additional consideration from the investor.

At the closing of the Exchange Agreement, the Warrant Shares were surrendered for

cancellation, deemed automatically cancelled and retired in full, and all rights, liabilities and obligations thereunder were discharged

of the Placement Shares, if any, will be made by means of ordinary brokers’ transactions on the Nasdaq Capital Market or any other

existing trading market for the Company’s common stock, in negotiated transactions, or by any other method permitted by law deemed

to be an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended.

Under the terms

of the Sales Agreement, the Agent may also purchase Placement Shares as principal for its own account at a price to be agreed upon at

the time of sale.

Agent will be entitled to compensation under the terms of the Sales Agreement at a commission rate equal to up to 3.0 %

of the gross proceeds of the sales price of common stock that it sells as Agent and up to

5.0 % of the gross proceeds of the sales price of common stock sold to the Agent as principal.

In connection with entering

into the Sales Agreement, the Company agreed to reimburse the Agent for certain fees and expenses, reasonable and documented legal,

filing and other direct offering costs, including reimbursement of Agent counsel fees not to exceed $ 50,000

in connection with the execution of the Sales Agreement and $ 5,000

per calendar quarter thereafter for ongoing representation updates.

During the three months ended June 30, 2026, the Company

incurred legal and professional fees of $ 107,875

in connection with entering into the Sales Agreement, which was capitalized as deferred offering costs and will be allocated against

proceeds as shares are sold.

Of this amount $ 3,584 was allocated against proceeds as shares are sold during the three months ended June 30,

The Company has evaluated the Sales Agreement and

the Placement Shares issued thereunder in accordance with applicable accounting guidance.

The Company determined that the Sales

Agreement is not within the scope of ASC 480, Distinguishing Liabilities from Equity , as it does not embody an unconditional

obligation to repurchase the Company’s equity shares, an obligation to settle by transferring assets, or an obligation to issue a variable

number of shares for a fixed monetary amount.

The Sales Agreement was further evaluated under ASC 815, Derivatives and Hedging ,

and ASC 815-40, Contracts in an Entity’s Own Equity .

The Company concluded that the Sales Agreement is not a derivative

instrument and does not contain any features that require bifurcation as embedded derivatives.

The Sales Agreement is indexed

to the Company’s own equity and satisfies all conditions for equity classification under ASC 815-40.

Accordingly, the Placement Shares

issued under the ATM Offering are classified as permanent equity in the accompanying condensed consolidated balance sheets,

and no derivative liability has been recognized in connection with the Sales Agreement or the ATM Offering.

the three months ended June 30, 2026, the Company sold an aggregate of 79,503

shares of Common Stock at a weighted average price per share

aggregating to net proceeds of $ 161,032 ,

after deducting commissions and other offering expenses.

Subsequent to quarter end, the Company sold 2,080,364

shares of Common Stock aggregating to net proceeds of 2,950,989 .

The Company intends to use the net proceeds from sales of Placement Shares under the Sales Agreement for general corporate purposes,

including working capital, capital expenditures, and advancement of its lithium refinery project in Muskogee, Oklahoma.

In connection with the Company’s ATM offering

program, the Company has agreed to indemnify the Agent against losses arising from material misstatements or omissions in the Registration

Statement or Prospectus, excluding losses attributable to information furnished in writing by the Agent.

If indemnification is unavailable,

contribution will be allocated based on relative benefits received (Net Proceeds to the Company vs.

commissions to the Agent), with the

Agent’s contribution capped at total commissions received.

These obligations survive termination of the sales agreement.

30, 2026, no claims have been asserted, and the Company does not believe a loss is probable;

accordingly, no liability has been accrued.

Offering and Warrant Inducement

the six months ended June 30, 2025, the Company completed two public offerings generating gross proceeds of $ 5,750,400 (January

2025), approximately $ 4,520,000 (June 2025, inclusive of a partially exercised over-allotment option) and a warrant inducement

transaction generating gross proceeds of $ 2,971,040 (March

No warrants issued in these transactions remain outstanding as of June 30, 2026.

These transactions, and the October 2025

warrant exchange in which the Inducement Warrants were exchanged for shares and cancelled, are described in greater detail in Note 6

to the Company’s Form 10-K.

Licensing Agreement

February 7, 2025, the Company executed the License Agreement with KMX.

Under the terms of the License Agreement, KMX agreed to irrevocably

license to the Company the use of KMX’s VMD Technology and associated processes and systems (including KMX VMD Units) for

the purpose of the Company’s use of the technology in its refining and upstream operations.

Among other obligations set forth in

the License Agreement, the Company shall be required to exclusively purchase all KMX VMD Units from KMX during the term of the

License Agreement on the terms and conditions set forth therein.

The License Agreement grants the Company the exclusive right to sub

license, use, market, sell and operate KMX’s VMD Technology across the United States, Canada and select international markets.

Under the terms of the License Agreement, KMX agreed to

irrevocably license to the Company the use of KMX’s VMD Technology and associated processes and systems (including KMX VMD

Units) for the purpose of the Company’s use of the technology in its refining and upstream operations.

Among other obligations

set forth in the License Agreement, the Company shall be required to exclusively purchase all KMX VMD Units from KMX during the term

of the License Agreement on the terms and conditions set forth therein.

The License Agreement grants the Company the exclusive right

to sublicense, use, market, sell and operate KMX’s VMD Technology across the United States, Canada and select international

As a consideration for this license, the Company agreed to pay KMX a royalty comprised of 50,000

shares of Company’s Common Stock.

shares of the Company’s Common Stock.

of the License Agreement Effective Date, the license did not meet the recognition criteria for an intangible asset under U.S.

1 unchanged sentence

commencement of operations at the Company’s planned facility.

Accordingly, the Company initially recognized a liability of $ 343,000

as other long-term liabilities, with a corresponding debit

recorded as other long-term assets on the audited and unaudited condensed consolidated balance sheets as of December 31, 2025 and March

31, 2026, respectively.

shares issuance, pending settlement

October 30, 2025, the Company approved issuance of 65,000 shares

of Common Stock to a vendor for services to be rendered over a period of 12 months.

The shares fully vested upon issuance and will

be expensed as services are received.

The Company recognized consulting expense of $ 75,562

for the three months ended March 31, 2026, and a prepaid expense of $ 226,688 and

of December 31, 2025 and March 31, 2026, respectively.

The corresponding amounts were recorded as an increase to additional paid-in capital.

Subsequent to the quarter end, the

Company issued the shares to the vendor.

Accordingly, the Company recognized $ 343,000

as other long-term assets on the audited and unaudited condensed

consolidated balance sheets as of December 31, 2025 and June 30, 2026, respectively.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

shares issuance

October 30, 2025, the Company approved the issuance of 65,000

shares of Common Stock to a vendor for services to be rendered over a period of 12 months.

The shares fully vested upon issuance and

will be expensed as services are received.

The Company recognized consulting expense of $ 75,562

and $ 151,128 for

the three and six months ended June 30, 2026, and a prepaid expense of $ 226,688

and $ 75,560 as of December 31, 2025

and June 30, 2026, respectively.

The corresponding amounts were recorded as an increase to additional paid-in capital.

quarter ended June 30, 2026, the Company issued the shares to the vendor.

Placement Agreement

December 31, 2024, the Company entered into binding term sheets with certain investors (“ 2024 Investors ”)

pursuant to which the Company agreed to sell, and the 2024 Investors agreed to purchase, Company securities for an aggregate amount

of $ 550,000 (the

“ Private Placement ”).

The 2024 Investors agreed to purchase, and the Company agreed to issue and sell, up to

shares of Common Stock at a price equal to 95% of the closing bid price of the Common Stock on the last trading day prior to the

closing date for the Private Placement.

In addition, each 2024 Investor will receive warrants representing the right, exercisable

within five years of the closing date, to purchase up to 50% of the shares of Common Stock purchased by such 2024 Investor in the

Private Placement, with 10 warrants exercisable for one share of Common Stock at an exercise price of $ 115.00 .

The Company received proceeds of $ 425,000 in

December 2024 and additional proceeds of $ 125,000 in

January 2025 from certain 2024 Investors.

The Company had accounted for this transaction as Advance from PIPE investor for shares

and warrants to be issued based on purchase agreement to be entered on the consolidated balance sheet as of December 31, 2024.

April 24, 2025, the Company issued 12,850 shares

of Common Stock and 64,251 Warrants

to the investors.

5 – STOCK BASED COMPENSATION

4 unchanged sentences

to increase the number of shares of Common Stock authorized for issuance under the 2023 Equity Incentive Plan by 115,056 shares of Common

During the three months ended March 31, 2026, there were no grants under the 2023 Equity Incentive Plan.

October and November 2023, Legacy Stardust Power granted stock options to purchase 227,810

shares of Common Stock under the 2023 Equity Incentive Plan.

All the options under the 2023 Equity Incentive Plan were

early-exercised by grantees.

Accordingly, the Company received a total amount of $ 14,850 towards

the early exercise of these options during the period from March 16, 2023 (inception) through December 31, 2023, and recorded a

liability against the early exercise of these options.

early exercised shares liability amounting to $ 1,422

is outstanding as at March 31, 2026, and December 31, 2025, respectively, and is presented under ‘Early exercised shares

option liability’ on the unaudited condensed and audited consolidated balance sheets, respectively.

option activity for the three months ended March 31, 2026, and balances as at the end of March 31, 2026, were as follows:

During the three and six months ended June 30, 2026, there were no grants under the 2023 Equity Incentive Plan.

October and November 2023, Legacy Stardust Power granted stock options to purchase 227,810 shares of Common Stock under the 2023 Equity

Incentive Plan.

All the options under the 2023 Equity Incentive Plan were early-exercised by grantees.

Accordingly, the Company received

a total amount of $ 14,850 towards the early exercise of these options during the period from March 16, 2023 (inception) through December

31, 2023, and recorded a liability against the early exercise of these options.

early exercised shares liability amounting to $ 1,109 and $ 1,735 is outstanding as at June 30, 2026, and December 31, 2025, respectively,

and is presented under ‘Early exercised shares option liability’ on the unaudited condensed and audited consolidated balance

sheets, respectively.

option activity for the six months ended June 30, 2026, and balances as at the end of June 30, 2026, were as follows:

SCHEDULE OF STOCK OPTION ACTIVITY

Unvested as at December 31,

Unvested as at March

Stock Options

Intrinsic Value

Unvested as of December 31, 2025

Unvested as of June 30, 2026

and Subsidiaries

1 unchanged sentence

total compensation expense for stock options recognized in the General and administrative expenses of the Company’s unaudited condensed

consolidated statements of operations was $ 25,149 and $ 25,809 for the three months ended March 31, 2026, and 2025, respectively.

at March 31, 2026, total unvested compensation cost for stock options granted to employees not yet recognized was $ 117,791 .

consolidated statements of operations was $ 50,171 and $ 50,826 for the six months ended June 30, 2026, and 2025, respectively.

compensation expense for stock options recognized in the General and administrative expenses of the Company’s unaudited condensed

consolidated statements of operations were $ 25,022 and $ 25,017 for the three months ended June 30, 2026, and 2025 respectively.

at June 30, 2026, total unvested compensation cost for stock options granted to employees not yet recognized was $ 92,769 .

expects to recognize this compensation over a weighted average period of approximately 1.10 years.

stock unit (“ RSU ”) activity for the three months ended March 31, 2026, and balances as at March 31, 2026,

were as follows:

stock unit (“ RSU ”) activity for the six months ended June 30, 2026, and balances as at June 30, 2026, were as follows:

SCHEDULE OF RESTRICTED STOCK ACTIVITY

Unvested as at December 31, 2025

at March 31, 2026

total compensation expense for RSUs recognized in the General and administrative expenses of the Company’s unaudited condensed consolidated

statements of operations was $ 468,898 and $ 1,297,888 for the three months ended March 31, 2026, and 2025, respectively.

at March 31, 2026, total unvested compensation cost for RSUs granted to employees not yet recognized was $ 1,057,364 .

The Company expects

to recognize this compensation over a weighted average period of approximately 1.37 years.

Unvested as at June 30, 2026

total compensation expense for RSUs recognized in the General and administrative expenses of the Company’s unaudited condensed

consolidated statements of operations was $ 826,865 and $ 2,392,528 for the six months ended June 30, 2026, and 2025, respectively.

total compensation expense for RSU recognized in the General and administrative expenses of the Company’s unaudited condensed consolidated

statements of operations was $ 357,967 and $ 1,094,640 for the three months ended June 30, 2026, and 2025, respectively.

total fair value of RSU’s vested during six months ended June 30, 2026, was $ 1,782,495 .

As at June 30, 2026, total unvested

compensation cost for RSUs granted to employees not yet recognized was $ 699,397 .

The Company expects to recognize this compensation over a weighted average period of approximately 1.23

Equity Incentive Plan

Board adopted, and the stockholders of the Company approved, the 2024 Equity Incentive Plan (the “2024 Plan”) in

September 2024.

The maximum number of shares with respect to one or more awards that may be granted to any one participant during

any calendar year shall be 467,366

Board adopted, and the stockholders of the Company approved, the 2024 Equity Incentive Plan (the “ 2024 Plan ”) in September

The maximum number of shares with respect to one or more awards that may be granted to any one participant during any calendar

year shall be 467,366

shares of Common Stock.

March 13, 2026, the Company filed a Registration Statement on Form S-8 for the purpose of registering an additional (i) 732,159 shares

of Common Stock that became issuable under the 2024 Plan pursuant to the provisions of the 2024 Plan providing for automatic

increases in the number of shares reserved for issuance thereunder (the “ Evergreen Shares ”) and (ii) 82,000 shares

of Common Stock that may again become available for issuance with respect to awards under the 2024 Plan pursuant to the share

March 13, 2026, the Company filed a Registration Statement on Form S-8 for the purpose of registering an additional (i) 732,159

shares of Common Stock that became issuable under the 2024 Plan pursuant to the provisions of the 2024 Plan providing for automatic

increases in the number of shares reserved for issuance thereunder (the “ Evergreen Shares ”) and (ii) 82,000

shares of Common Stock that may again become available for issuance with respect to awards under the 2024 Plan pursuant to the share

counting, share recycling and other terms and conditions of the 2024 Plan (the “ Recycled Shares ”).

at the Annual Meeting on June 2, 2026, the Company’s stockholders approved an amendment and restatement of the Company’s

2024 Plan to increase the number of shares available for issuance under the 2024 Plan by 2,600,000

shares and extend the 2024 Plan’s term to April 8, 2036.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

the three months ended March 31, 2026, the Company granted (a) 40,000

RSUs to employees, which vested immediately upon grant, (b) 620,362

the six months ended June 30, 2026, the Company granted (a) 40,000 RSUs to employees, which vested immediately upon grant, (b) 620,362

RSUs to employees, which vested immediately upon grant and were issued in settlement of prior year bonuses and (c) 21,692 RSUs to consultants

which vested immediately upon grant and were issued in settlement of prior year bonuses.

fair value of common stock is based on the closing price of the Company’s Common Stock, as reported on the Nasdaq on the date of

activity for the three months ended March 31, 2026, and balances as at the end of March 31, 2026, were as follows:

which vested immediately upon grant and were issued in settlement of prior year incentives.

fair value of common stock is based on the closing price of the Company’s Common Stock, as reported on Nasdaq on the date of

activity for the six months ended June 30, 2026, and balances as at the end of June 30, 2026, were as follows:

SCHEDULE OF RESTRICTED STOCK ACTIVITY

Unvested as at December 31, 2025

Unvested as at March

Unvested as at June 30, 2026

total compensation expense for RSUs recognized in the General and administrative expenses of the Company’s unaudited condensed

1 unchanged sentence

and $ 1,374,077

for the three months ended March 31, 2026, and 2025, respectively.

at March 31, 2026, total unvested compensation cost for RSUs granted to employees and non-employee directors not yet recognized was $ 3,486,743 .

for the six months ended June 30, 2026, and 2025, respectively.

total compensation expense for RSUs recognized in the General and administrative expenses of the Company’s unaudited condensed

consolidated statements of operations was $ 604,056

for the three months ended June 30, 2026, and 2025, respectively.

The total fair value of RSU’s vested during

six months ended June 30, 2026, was $ 2,954,614 .

at June 30, 2026, total unvested compensation cost for RSUs granted to employees and non-employee directors not yet recognized was $ 2,936,598 .

The Company expects to recognize this compensation over a weighted average period of approximately 2.27 years.

at March 31, 2026, total unvested compensation cost for RSUs granted to the consultants not yet recognized was $ 534,784 .

The Company expects to recognize this compensation over a period of approximately 2.46

stock unit (“ PSU ”) activity for the three months ended March 31, 2026, and balances as at the end of March 31, 2026,

were as follows:

at June 30, 2026, total unvested compensation cost for RSUs granted to the consultants not yet recognized was $ 480,872 .

The Company expects

to recognize this compensation over a period of approximately 2.21 years.

stock unit (“ PSU ”) activity for the six months ended June 30, 2026, and balances as at the end of June 30, 2026, were

SCHEDULE OF PERFORMANCE SHARES UNITS ACTIVITY

Unvested as at December 31, 2025

Unvested as at March

Unvested as at June 30, 2026

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

total compensation expense for PSUs recognized in the General and administrative expenses of the Company’s unaudited condensed

consolidated statements of operations was $ 563,230 and $ 563,248 for the six months ended June 30, 2026, and 2025, respectively.

total compensation expense for PSUs recognized in the General and administrative expenses of the Company’s unaudited condensed

consolidated statements of operations was $ 283,170

and $ 283,179

for the three months ended March 31, 2026, and 2025, respectively.

at March 31, 2026, total unvested compensation cost for PSUs granted to employees not yet recognized was $ 1,661,792 .

for the three months ended June 30, 2026, and 2025, respectively.

at June 30, 2026, total unvested compensation cost for PSUs granted to employees not yet recognized was $ 1,378,621 .

The Company expects

to recognize this compensation over a weighted average period of approximately 1.21 years.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

6 – ACCOUNTING FOR WARRANT LIABILITY

Sponsor purchased from GPAC II, a Cayman Islands exempted company, an aggregate of 5,566,667 warrants at a price of $ 1.50 per warrant in a private placement that

occurred simultaneously with the completion of the Company’s initial public offering (the “ Private

The Company established the initial fair value of the Private Warrants and the Company’s detachable redeemable warrants and distributable redeemable warrants (the “ Public

Warrants ”) on July 8, 2024, the date of

consummation of the Business Combination, and revalued the warrants on March 31, 2026.

Each 10 Warrants entitle the holder to

purchase one share of Common Stock at an exercise price of $ 115.00

For additional terms refer to the Company’s Registration Statement on Form S-4/A filed with the SEC on May 8, 2024.

As at March 31, 2026, and December 31, 2025, there were 10,430,800

warrants outstanding, including 4,864,133

Public Warrants and 5,566,667

Private Warrants outstanding.

The Company may redeem the outstanding Public Warrants in whole and not in part at a price of

$0.01 per warrant upon a minimum of 30 days’ prior written notice of redemption, only in the event that the last sale price of

the Common Stock equals or exceeds $180.00 per share for any 20 trading days within the 30-trading day period ending on the third trading

day before the Company sends the notice of redemption to the Public Warrant holders, and that certain other conditions are met.

The Company may also redeem the outstanding Public Warrants in whole and not in part at a price

of $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption, only in the event that the closing price of

the common stock equals or exceeds $100.00 per share on the trading day prior to the date on which the Company sends the notice of redemption,

and that certain other conditions are met.

If the closing price of the common stock is less than $180.00 per share (as adjusted) for

any 20 trading days within a 30-trading day period ending three trading days before the Company sends the notice of redemption to the

warrant holders, the Private Warrants must also concurrently be called for redemption on the same terms as the outstanding Public Warrants.

The Company timely filed a registration statement on Form S-1 with the

SEC on August 1, 2024, for the registration of the shares issuable upon exercise of the warrants.

The registration statement (File No.

333-281160) was declared effective by the SEC on August 9, 2024.

Company’s Public Warrants and Private Warrants (together, the “Warrants”) were issued in connection with the Business

Combination that closed on July 8, 2024, as described in the Company’s Form 10-K.

Each 10 Warrants entitle the holder to purchase one share of Common Stock at an exercise price of $ 115.00 per share.

30, 2026, and December 31, 2025, there were 10,430,800 warrants outstanding, including 4,864,133 Public Warrants and 5,566,667 Private

Warrants outstanding.

Company may redeem the outstanding Public Warrants in whole and not in part at a price of $0.01 per warrant upon a minimum of 30 days’

prior written notice of redemption, only in the event that the last sale price of the Common Stock equals or exceeds $180.00 per share

for any 20 trading days within the 30-trading day period ending on the third trading day before the Company sends the notice of redemption

to the Public Warrant holders, and that certain other conditions are met.

The Company may also redeem the outstanding Public Warrants

in whole and not in part at a price of $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption, only in

the event that the closing price of the common stock equals or exceeds $100.00 per share on the trading day prior to the date on which

the Company sends the notice of redemption, and that certain other conditions are met.

If the closing price of the common stock is less

than $180.00 per share (as adjusted) for any 20 trading days within a 30-trading day period ending three trading days before the Company

sends the notice of redemption to the warrant holders, the Private Warrants must also concurrently be called for redemption on the same

terms as the outstanding Public Warrants.

Private Warrants have terms and provisions that are identical to those of the Public Warrants.

4 unchanged sentences

and exercisable by the holders on the same basis as the Public Warrants.

Company continues to classify the Warrants as derivative liabilities under ASC 815-40, consistent with the classification analysis described

in the Company’s Form 10-K.

The Warrants are remeasured at fair value each

reporting period, with changes recognized in the condensed consolidated statements of operations.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Company’s warrants are not indexed to the Company’s Common Stock in the manner contemplated by ASC Section 815-40-15 because

the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares.

Further, there is a settlement

cap for Public Warrants, and Private Warrants upon transfer from Sponsor or permitted transferees to other holders, if the holder elects

to exercise warrants on a cashless basis if the Company fails to maintain an effective registration statement covering the Common Stock

issuable upon warrant exercises throughout the term of the warrants.

Maintenance of an effective registration statement is not an input

to the fair value option model for a fixed-for-fixed option or forward.

As such, the Company’s warrants are accounted for as derivative

warrant liabilities which are required to be valued at fair value at each reporting period.

following tables present information about the Company’s warrant liabilities that are measured at fair value on a recurring

basis at March 31, 2026, and December 31, 2025, and indicate the fair value hierarchy of the valuation inputs the Company utilized

to determine such fair value:

following tables present information about the Company’s warrant liabilities that are measured at fair value on a recurring basis

at June 30, 2026, and December 31, 2025, and indicate the fair value hierarchy of the valuation inputs the Company utilized to determine

such fair value:

SCHEDULE OF WARRANT LIABILITIES THAT ARE MEASURED AT FAIR VALUE ON A RECURRING BASIS

Price In Active Markets

Other Observable Input

Other Unobservable Input

Warrant liability

Public warrants

1 unchanged sentence

Warrant liability

Price In Active Markets

Other Observable Input

Other Unobservable Input

Warrant liability

At December 31,

Public warrants

1 unchanged sentence

Warrant liability

March 31, 2026 and December 31, 2025, the Company valued its Public Warrants by reference to the publicly traded price of the Public

June 30, 2026 and December 31, 2025, the Company valued its Public Warrants by reference to the publicly traded price of the Public Warrants.

The Company valued its Private Warrants based on the closing price of the Public Warrants since they are similar instruments.

2 unchanged sentences

the end of the reporting period.

There were no transfers during the three months ended March 31, 2026.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

There were no transfers during the three and six months ended June 30, 2026.

7 – INVESTMENT IN EQUITY SECURITIES

5 unchanged sentences

Accordingly, the investment in these securities has been recorded at cost at initial

recognition and at fair value of $ 42,975

as at March 31, 2026, and December 31, 2025, respectively.

The Company recognized a gain of $ 5,601

and loss of $ 4,031

for the three months ended March 31, 2026, and March 31, 2025,

respectively, due to change in fair value of securities in the unaudited condensed consolidated statement of operations.

Further, this

investment in securities has been disclosed outside of current assets on the unaudited condensed consolidated balance sheet in accordance

with ASC 210-10-45-4 because the investment has been made for the purpose of affiliation and continuing business.

December 2024, Stardust Power subscribed to and purchased 10,000,000

ordinary shares (approximately 6 %

of the total equity) of IRIS Metals Limited (“ IRIS Metals ”), an Australian limited company whose ordinary shares are

listed on the ASX, for $ 1,600,000 .

Metals’ ordinary shares are listed on the ASX with a readily determinable fair value, and changes in fair value are recognized

in the condensed consolidated statements of operations.

During the year ended December 31, 2025, management determined that a strategic

investment in IRIS Metals was no longer viable.

As a result, the Company sold all of its investment in IRIS Metals.

Accordingly, as of

March 31, 2026, and December 31, 2025, the Company no longer held any investment in IRIS Metals and no gain or loss due to changes in

the fair value of securities was recognized during the three months ended March 31, 2026.

During the three months ended March 31, 2025,

the Company recognized gain due to changes in the fair value of securities of $ 14,786 .

recognition and at fair value of $ 28,802 and $ 37,374 as at June 30, 2026, and December 31, 2025, respectively.

The Company recognized

a loss of $ 14,173 and $ 8,572 for the three and six months ended June 30, 2026, and $ 12,448 and $ 16,479 for the three and six months ended

June 30, 2025, respectively, due to change in fair value of securities in the unaudited condensed consolidated statement of operations.

Further, this investment in securities has been disclosed outside of current assets on the unaudited condensed consolidated balance sheet

in accordance with ASC 210-10-45-4 because the investment has been made for the purpose of affiliation and continuing business.

Company held an investment in IRIS Metals Limited (“ IRIS Metals ”), an ASX listed equity security which was fully divested

during fiscal year 2025 and is described in the Company’s Form 10-K.

the three months ended June 30, 2025, the Company sold 1,175,000

ordinary shares of IRIS Metals for total proceeds of $ 78,311 .

The carrying value of the shares at the time of sale was $ 173,489 ,

resulting in a realized loss of $ 95,178 .

The remaining shares of IRIS Metals were subsequently sold during the second half of 2025.

Accordingly, as of June 30, 2026, and December

31, 2025, the Company no longer held any investment in IRIS Metals and no gain or loss due to changes in the fair value of securities

was recognized during the three and six months ended June 30, 2026.

During the three and six months ended June 30, 2025, the Company

recognized loss due to changes in the fair value of securities of $ 726,441

and $ 711,655 ,

respectively.

and Subsidiaries

1 unchanged sentence

8 – CONVERTIBLE NOTES AND WARRANTS

2025 Convertible Notes

On December 23, 2025, the Company entered into a

Securities Purchase Agreement (“ SPA ”)

with Lind Global Asset Management XIII LLC (“ Lind ”) providing for up to $ 15,000,000

2025 Convertible Note

December 23, 2025, the Company entered into the Lind Securities Purchase Agreement with Lind providing for up to $ 15,000,000

in senior secured convertible debt financing.

At closing, the Company received net cash proceeds of $ 3,792,500 after payment of a $ 100,000

commitment fee and $ 107,500 in legal fees in exchange for issuing to Lind a Senior Secured Convertible Promissory Note with a principal

amount of $ 4,800,000

(the “ 2025 Convertible Note ”), and a Common Stock Purchase Warrant to purchase approximately 411,245

shares of the Company’s Common Stock (the “ 2025 Lind Warrant ”).

The 2025 Convertible Note does not bear stated

rate of interest.

At closing, the

Company received net cash proceeds of $ 3,792,500

after payment of a $ 100,000

commitment fee and $ 107,500

in legal fees in exchange for issuing to Lind the 2025 Convertible

Note with a principal amount of $ 4,800,000

and the 2025 Lind Warrant to purchase approximately 411,245

shares of the Company’s Common Stock.

2025 Convertible Note does not bear a stated rate of interest.

The principal is repayable in 20 consecutive monthly installments of

6 unchanged sentences

of the average of five consecutive daily VWAPs selected by Lind during the 20 trading days prior to issuance.

The 2025 Convertible Note is

convertible at Lind’s option at a fixed conversion price of $ 5.837

The 2025 Convertible

Note is convertible at Lind’s option at a fixed conversion price of $ 5.837

per share, subject to customary anti-dilution adjustments and a floor price mechanism.

4 unchanged sentences

approval is obtained.

Any overdue amounts under the 2025 Convertible Note

bear interest at 10% per annum, compounded annually on a 360-day year basis, from the due date until paid in full.

All accrued and unpaid

amounts, including interest on overdue interest, are payable on demand.

The 2025 Convertible Note held by Lind is transferable

and may be sold, assigned, or pledged, subject to compliance with applicable laws and regulations.

The note may be prepaid in full by

the Company upon 10 days’ prior written notice, however, upon any such prepayment notice, Lind may elect to convert up to one-third

of the then-outstanding principal at the lower of (i) the applicable conversion price or (ii) the Repayment Share price.

The 2025 Convertible Note includes customary

provisions related to change-in-control events, delisting, and events of defaults, which may result in accelerated repayment or

conversion at adjusted prices.

Upon the occurrence of any of the aforementioned events, Lind may require cash repayment or elect

alternative settlement provisions.

The Company evaluated that the 2025 Convertible

Notes contain embedded features requiring recognition as derivatives and bifurcation.

However, the Company determined the fair value

of these embedded derivatives was immaterial as of December 31, 2025, and therefore measured the 2025 Convertible Note at amortized

cost and recorded it as a liability on the consolidated balance sheet.

Because the 2025 Convertible Note and related warrant were

issued in a single financing transaction, the Company allocated the net proceeds to the 2025 Convertible Note and the warrants based

on their relative fair values.

overdue amounts under the 2025 Convertible Note bear interest at 10% per annum, compounded annually on a 360-day year basis, from the

due date until paid in full.

All accrued and unpaid amounts, including interest on overdue interest, are payable on demand.

2025 Convertible Note held by Lind is transferable and may be sold, assigned, or pledged, subject to compliance with applicable laws

and regulations.

The note may be prepaid in full by the Company upon 10 days’ prior written notice;

however, upon any such prepayment

notice, Lind may elect to convert up to one-third of the then-outstanding principal at the lower of (i) the applicable conversion price

or (ii) the Repayment Share price.

2025 Convertible Note includes customary provisions related to change-in-control events, delisting, and events of defaults, which may

result in accelerated repayment or conversion at adjusted prices.

Upon the occurrence of any of the aforementioned events, Lind may require

cash repayment or elect alternative settlement provisions.

Company evaluated that the 2025 Convertible Note contains embedded features requiring recognition as derivatives and bifurcation.

the Company determined the fair value of these embedded derivatives was immaterial as of December 31, 2025, and therefore measured the

2025 Convertible Note at amortized cost and recorded it as a liability on the consolidated balance sheet.

Because the 2025 Convertible

Note and related warrant were issued in a single financing transaction, the Company allocated the net proceeds to the 2025 Convertible

Note and the warrants based on their relative fair values.

A portion of the total debt issuance costs of $ 207,500

was allocated to the warrants based on their relative fair value, resulting in an allocation of $ 34,610

to the warrants and $ 172,890 to

the 2025 Convertible Note.

was allocated to the warrants based on their relative fair

value, resulting in an allocation of $ 34,610 to the warrants and $ 172,890

to the 2025 Convertible Note.

In total, $ 34,610

was recorded in additional paid-in capital (“APIC”) related to the warrants, and a debt discount and debt issuance costs

of $ 1,640,062

were recorded as a reduction of the carrying amount of the 2025 Convertible Note, representing the difference between the $ 4,800,000

principal amount and the amount allocated to the debt component at issuance.

was recorded in additional paid-in capital (“ APIC ”)

related to the warrants, and a debt discount and debt issuance costs of $ 1,640,062

were recorded as a reduction of the carrying amount of the

2025 Convertible Note, representing the difference between the $ 4,800,000

principal amount and the amount allocated to the debt component

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

of December 31, 2025 and March 31, 2026, the principal amount outstanding under the 2025 Convertible Note was $ 4,800,000 and $ 4,800,000 ,

respectively, and unamortized debt discount and issuance costs, including amount attributed to warrants issued, totaled $ 1,606,994 and

$ 1,245,037 , respectively, resulting in a net carrying amount of $ 3,193,006 and $ 3,554,963 , respectively, at an effective interest rate

As of December 31, 2025, the estimate fair value of the instrument approximates carrying value given the instrument was issued

in December 2025 and has a short time period until maturity.

the three months ended March 31, 2026, the Company recognized $ 361,958 of interest expense related to the Convertible Note, representing

amortization of debt discount and issuance cost.

Such interest expense is included within interest expense in the Company’s unaudited

condensed consolidated statement of operations for the three months ended March 31, 2026.

future contractual payments of 2025 Convertible Note as of March 31, 2026, are as follows:

of December 31, 2025 and June 30, 2026, the principal amount outstanding under the 2025 Convertible Note was $ 4,800,000

and $ 4,080,000 ,

respectively, and unamortized debt discount and issuance costs, including amount attributed to warrants issued, totaled $ 1,606,994

and $ 914,285 ,

respectively, resulting in a net carrying amount of $ 3,193,006

and $ 3,165,715 ,

respectively, at an effective interest rate of 43.2 %.

the three and six months ended June 30, 2026, the Company recognized $ 330,752 and

interest expense related to the 2025 Convertible Note, representing amortization of debt discount and issuance cost.

Such interest

expense is included within interest expense in the Company’s unaudited condensed consolidated statement of operations for the

three and six months ended June 30, 2026.

the three and six months ended June 30, 2026, the Company elected to repay the three scheduled monthly principal installments under

the 2025 Convertible Note through the issuance of Repayment Shares.

The number of shares issued for each installment was determined

in accordance with the terms of the Lind Securities Purchase Agreement.

Upon settlement, the Company recognized loss on extinguishment of 2025 Convertible Note of

$ 127,381 for

the three months ended June 30, 2026, in the unaudited condensed consolidated statement of operations reflecting the difference

between the installment amount and the fair value of the Repayment Shares as of the date of issuance.

future contractual payments of 2025 Convertible Note as of June 30, 2026, are as follows:

SCHEDULE OF FUTURE CONTRACTUAL PAYMENT

of March 31, 2026

Remainder of 2026

of June 30, 2026

Section 2.1(s) of the 2025 Convertible Note issued to Lind in December 2025, an event of default occurs if the Company’s

market capitalization remains below $ 15.0 million

for ten consecutive trading days.

Subsequent to the quarter end, this event of default occurred automatically and without any

applicable cure period on August 11, 2026, (the “Triggering Event”).

The Triggering Event did not result from any

failure by the Company to make scheduled payments under the 2025 Convertible Note.

a result of the Triggering Event, the Company, among other things, became obligated to pay the Mandatory Default Amount, equal to 110 %

of the outstanding principal (approximately $ 4.22 million),

plus all other amounts owing under the 2025 Convertible Note, with default interest accruing at a rate of 10 %

Lind may declare the Mandatory Default Amount immediately due and payable and exercise remedies as a secured creditor

over substantially all of the assets of the Company and its subsidiaries, including the pledged equity interests.

Lind may also

convert outstanding principal into shares of Common Stock at a discounted conversion price.

Company and Lind are engaged in discussions regarding a potential forbearance, waiver, or amendment with respect to the Triggering Event;

however, there can be no assurance that such discussions will result in a definitive agreement, or that any agreement will be reached

on terms acceptable to the Company.

As of the date these unaudited condensed consolidated financial statements were available to be issued,

Lind had not accelerated the 2025 Convertible Note or exercised any remedies thereunder.

Common Stock Warrant:

On December 23, 2025, in connection

with the 2025 Convertible Note, the Company also issued to Lind a warrant to purchase up to 411,245 shares of Common Stock at an exercise

price of $ 5.837 per share, exercisable beginning six months after issuance and expiring 60 months thereafter.

These may be exercised for

cash or, in limited circumstances when a resale registration statement is unavailable or in connection with certain fundamental transactions,

on a net share (cashless) basis, in which case Lind receives a reduced number of shares based on the intrinsic value of the warrants.

The warrants provide for standard

protection in the event of major transactions (for example, the holder receives equivalent consideration, or, in some cases, cash based

on Black-Scholes value) and include anti-dilution adjustments for stock splits, stock dividends, and certain issuances of stock below

the then-current exercise price.

The warrants are also subject to beneficial

ownership limitations, are transferable subject to securities law compliance, and confer no voting or dividend rights until exercised.

December 23, 2025, in connection with the 2025 Convertible Note, the Company also issued to Lind a warrant to purchase up to 411,245

shares of Common Stock at an exercise price of $ 5.837 per share, exercisable beginning six months after issuance and expiring 60 months

These may be exercised for cash or, in limited circumstances when a resale registration statement is unavailable or in connection

with certain fundamental transactions, on a net share (cashless) basis, in which case Lind receives a reduced number of shares based

on the intrinsic value of the warrants.

warrants provide for standard protection in the event of major transactions (for example, the holder receives equivalent consideration,

or, in some cases, cash based on Black-Scholes value) and include anti-dilution adjustments for stock splits, stock dividends, and certain

issuances of stock below the then-current exercise price.

warrants are also subject to beneficial ownership limitations, are transferable subject to securities law compliance, and confer no voting

or dividend rights until exercised.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Company reviewed the warrants in connection with the securities purchase agreements under ASC 815, “ Derivatives and Hedging, ” (“ ASC 815 ”) and concluded that the warrants are

not in scope of ASC 480, “ Distinguishing Liabilities from Equity, ” and are not subject to the derivative guidance under ASC 815.

Company reviewed the warrants in connection with the securities purchase agreements under ASC 815, “ Derivatives and Hedging, ”

(“ ASC 815 ”) and concluded that the warrants are not in scope of ASC 480, “Distinguishing Liabilities from Equity,”

and are not subject to the derivative guidance under ASC 815.

Accordingly, the warrants were equity classified.

The fair value of the warrants at the issuance date of $ 667,172 was determined using a Black-Scholes option pricing model, which includes

the use of Level 3 inputs.

The resulting fair value of the warrants was recorded in APIC, net of issuance costs, and is not subject to

subsequent remeasurement.

The Company estimates its stock price volatility using the historical volatility of publicly traded peer companies.

The fair value of the

warrants at the issuance date of $ 667,172

was determined using a Black-Scholes option pricing model,

which includes the use of Level 3 inputs.

The resulting fair value of the warrants was recorded in APIC, net of issuance costs, and is

not subject to subsequent remeasurement.

The Company estimates its stock price volatility using the historical volatility of publicly

traded peer companies.

The term is equal to the contractual term of the warrants.

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

yield curve for the time period equal to the term of the warrants.

The expected dividend yield is zero based on the fact that the Company

has never paid cash dividends on Common Stock and does not expect to pay any cash dividends in the foreseeable future.

Assumptions used

in calculating the fair value of the warrants at the issuance date include the following:

The risk-free interest rate is determined by reference

Treasury yield curve for the time period equal to the term of the warrants.

The expected dividend yield is zero based on

the fact that the Company has never paid cash dividends on Common Stock and does not expect to pay any cash dividends in the foreseeable

Assumptions used in calculating the fair value of the warrants at the issuance date include the following:

OF FAIR VALUE ASSUMPTION

Fair value of Common Stock as

of December 23, 2025

Exercise Price

Risk-free interest rate

Contractual terms (years)

Dividend Yield

value of Common Stock as of December 23, 2025

interest rate

terms (years)

9 – FAIR VALUE MEASUREMENTS

following tables summarize the Company’s assets and liabilities that are measured at fair value in the condensed consolidated

financial statements:

following tables summarize the Company’s assets and liabilities that are measured at fair value in the condensed consolidated financial

SCHEDULE OF ASSETS AND LIABILITIES ARE MEASURED AT FAIR VALUE

Value Measurements as at December 31, 2025 (audited)

Fair Value Measurements as at December 31, 2025 (audited)

Other noncurrent assets:

in equity securities (a)

Investment in equity securities (a)

Total financial assets

Value Measurements as at March 31, 2026

Fair Value Measurements as at June 30, 2026

Other noncurrent assets:

in equity securities (a)

Investment in equity securities (a)

Total financial assets

Value Measurements as at December 31, 2025 (audited)

earnout shares (b)

Fair Value Measurements as at December 31, 2025 (audited)

Sponsor earnout shares (b)

Total financial liabilities

Value Measurements as at March 31, 2026

earnout shares (b)

Fair Value Measurements as at June 30, 2026

Sponsor earnout shares (b)

Total financial liabilities

2 unchanged sentences

with ASC 321, “Investments-Equity Securities,” based on quoted prices in active markets.

Level 3 earnout liability, the Company assesses the fair value of expected earnout liability

at each reporting period using the Monte Carlo Method, which is consistent with the initial

measurement of the expected earnout consideration.

This fair value measurement is considered

a Level 3 measurement because the Company estimates projections during the earnout period

utilizing various potential pay-out scenarios.

The Monte Carlo simulation method repeats

a process thousands of times in an attempt to predict all the possible future outcomes.

the end of the simulation, several random trials produce a distribution of outcomes that

are then analyzed to determine the average present value of earnout.

Change in the fair value

of earnout liability is reflected in the unaudited condensed consolidated statements of operations.

Level 3 earnout liability, the Company assesses the fair value of expected earnout liability at each reporting period using the

Monte Carlo Method, which is consistent with the initial measurement of the expected earnout consideration.

This fair value

measurement is considered a Level 3 measurement because the Company estimates projections during the earnout period utilizing

various potential pay-out scenarios.

The Monte Carlo simulation method repeats a process thousands of times in an attempt to predict

all the possible future outcomes.

At the end of the simulation, several random trials produce a distribution of outcomes that are

then analyzed to determine the average present value of the earnout.

Change in the fair value of earnout liability is reflected in

the unaudited condensed consolidated statements of operations.

make-whole obligation liability related to the Prior B.

13 unchanged sentences

of allocating resources and evaluating financial performance.

The Company has a single, common management team and the Company’s cash flows are

reported and reviewed with no distinct cash flows.

The measure of segment assets is reported on the unaudited condensed consolidated

balance sheets as total consolidated assets.

All of the Company’s long-lived assets are located in the United Sates.

addition to the significant expense categories included within net loss presented on the Company’s unaudited condensed

consolidated statements of operations, see below for disaggregated amounts that comprise general and administrative

The Company has a single, common management team and the Company’s

cash flows are reported and reviewed with no distinct cash flows.

The measure of segment assets is reported on the unaudited condensed

consolidated balance sheets as total consolidated assets.

All of the Company’s long-lived assets are located in the United States.

addition to the significant expense categories included within net loss presented on the Company’s unaudited condensed consolidated

statements of operations, see below for disaggregated amounts that comprise general and administrative expenses.

SCHEDULE OF SEGMENT REPORTING CONSOLIDATED STATEMENTS OF OPERATIONS

March 31, 2026

March 31, 2025

June 30, 2026

June 30, 2025

June 30, 2026

June 30, 2025

Three months ended

Six months ended

June 30, 2026

June 30, 2025

June 30, 2026

June 30, 2025

Payroll and related taxes

Professional and consulting fees

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

11 – RELATED PARTY TRANSACTIONS

September 18, 2024, the Company entered into a consulting agreement with DRE Chicago LLC (“ DRE Chicago ”), whose

principal is Paramita Das.

Das was previously Chief Strategy Officer and Senior Advisor to the Chief Executive Officer of the

Additionally, in December 2024, the Company entered into a binding term sheet with DRE Chicago, providing for a loan in the

principal amount of $ 250,000 ,

bearing interest at a rate of 15 %

per annum, and maturing in March 2025 (the “ Maturity Date ”).

The Company agreed to issue to DRE Chicago an

aggregate of $ 375,000 in

Common Stock as an equity kicker.

DRE Chicago was also entitled to receive warrants up to 50% of the Common Stock issued as the

equity kicker, with 10 warrants exercisable for one share of Common Stock at an exercise price of $ 115.00 in

accordance with the private placement terms.

The Company recognized interest expense of $ 7,187 during the three months ended March

As of December 31, 2025, the Company repaid the principal amount of $ 250,000 along

with accrued interest of $ 9,166 and

issued 10,474 shares

of Common Stock and 52,374 warrants

to DRE Chicago.

Das terminated her employment with the Company in November 2025 and is no longer considered a related party as

of March 31, 2026.

December 2024, the Company entered into a binding Term Sheet (the “ Endurance Term Sheet ”) with Endurance

Antarctica Partners II, LLC (“ Endurance ”), an affiliate of a director at the time and a shareholder, providing

for a loan (the “ Endurance Loan ”) in the aggregate principal amount of $ 1,750,000 ,

bearing interest at a rate of 15 %

per annum, and maturing in March 2025 (the “ Endurance Maturity Date ”).

The Company agreed to issue to Endurance

$ 3,500,000 in

Common Stock as an equity kicker.

Endurance was also entitled to receive warrants up to 50% of the Common Stock issued as the equity

kicker, with 10 warrants exercisable for one share of Common Stock at an exercise price of $ 115.00 in

accordance with the private placement terms.

The Company recognized interest expense of $ 51,042 during the three months ended March

As of December 31, 2025, the Company repaid the principal amount of $ 1,750,000 along

with accrued interest of $ 70,000 and

issued 97,765 shares

of Common Stock and 488,826 warrants

to Endurance.

Company previously entered into a consulting agreement and loan arrangement with DRE Chicago LLC (“ DRE Chicago ”),

whose principal, Paramita Das, was the Company’s former Chief Strategy Officer and Senior Advisor to the Chief Executive Officer

as described in the Company’s Form 10-K.

The Company recognized interest

expense of $ 7,187 during the six months ended June 30, 2025.

The loan was fully repaid, together with accrued interest, as of December

31, 2025, and 52,374 warrants, remain outstanding.

DRE Chicago’s loan was entered into as part of a larger $ 1,800,000 Term Sheets facility with several lenders, which was fully repaid, together with accrued interest, as of December 31, 2025.

Das terminated

her employment with the Company in November 2025 and is no longer considered a related party as of June 30, 2026.

Company previously entered into a loan arrangement with Endurance Antarctica Partners II, LLC (“ Endurance ”), an affiliate

of a director at the time and a shareholder, as described in the Company’s Form 10-K.

The Company recognized interest expense of

during the six months ended June 30, 2025.

The loan was fully

repaid, together with accrued interest, as of December 31, 2025, and 488,826

warrants, remain outstanding.

As of the date of this

quarterly report, the Endurance-affiliated individual is no longer a member of our board of directors.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 2023, the Company entered into unsecured notes payable with three related parties.

These notes payable provided the Company the

ability to draw up to $ 1,000,000 ,

in aggregate.

In June 2025, the Company drew $ 250,000

from Energy Transition Investors LLC, and subsequently repaid

the drawn amount by quarter end.

The Company had accrued interest of $ 422

during the six months ended June 30, 2025 on the drawn amount

and subsequently paid the interest in January 2026.

12 - ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES:

SCHEDULE OF ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES

31, 2025 (audited)

June 30, 2026

December 31, 2025

Accrued expenses

5 unchanged sentences

August 5, 2025, the Company entered into a financing agreement of $ 407,500

for the purchase of an insurance policy with AFCO Insurance

Premium Finance.

The debt is payable in monthly instalments through June 2026 and bears an interest

rate of 7.5 %.

The carrying amount of $ 103,848

for the purchase of an insurance policy with AFCO Insurance Premium Finance.

The debt is payable in monthly installments through

June 2026 and bears an interest rate of 7.5 %.

The carrying amount of Nil

and $ 205,403

is included as Short-term Loan on the accompanying

unaudited condensed consolidated balance sheet as on March 31, 2026, and audited consolidated balance sheet as on December 31, 2025,

respectively.

is included as Short-term Loan on the accompanying unaudited condensed consolidated balance sheet as on June 30, 2026, and the

audited consolidated balance sheet as on December 31, 2025, respectively.

The Company recognized interest expense of $ 963

for the three months ended March 31, 2026.

July 18, 2024, the Company entered into a financing agreement of $ 510,000

for the purchase of an insurance policy with AFCO Insurance

Premium Finance.

The debt is payable in monthly instalments through June 2025 and bears an interest rate of 8.46 %.

The debt was fully repaid in June 2025.

The Company recognized interest expense of nil

for the three months ended March 31, 2026 and March 31, 2025, respectively.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

on the accompanying unaudited condensed consolidated statement of operations for the three and six months ended June 30, 2026,

respectively.

separate insurance financing agreement entered into in July 2024 was fully repaid in June 2025;

the Company recognized related interest

expense of $ 1,164 and $ 5,067 for the three and six months ended June 30, 2025, respectively.

Subsequent to three months ended June 30, 2026, the Company entered into a financing

agreement of $ 493,532

for the purchase of an insurance policy with AFCO Insurance Premium Finance.

The Company made a down payment of $ 172,736 ,

which was applied to the loan amount at the time of the loan agreement.

The debt is payable in 7

monthly installments of $ 47,189

per month and bears an interest rate of 6.99 %.

short-term loans

December 2024, the Company entered into the Endurance Term Sheet with Endurance providing for a loan in the aggregate principal

amount of $ 1,750,000 ,

bearing interest at a rate of 15 %

per annum, and maturing in March

The Company agreed to issue to Endurance $ 3,500,000 in

Common Stock as an Equity Kicker.

In addition, Endurance

received warrants representing the right, exercisable within five years of the closing date, of up to 50% of Common Stock issued as

Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $ 115.00 in

accordance with such private placement terms.

As of December 31, 2025, the Company has repaid the principal amount of $ 1,750,000 along

with accrued interest of $ 70,000 and

issued 97,765 shares

of Common Stock and 488,826 warrants

to Endurance.

December 2024, the Company entered into binding Term Sheets (the “ Investor Term Sheets ”) with several lenders including

DRE Chicago, a related party (collectively, the “ Investors ”), providing for loans (the “ Investor Loans ”)

in the aggregate principal amount of $ 1,800,000 ,

bearing interest at a rate of 15 %

per year, and maturing in March

2025 (the “ Investor Maturity Date ”).

The Company agreed to issue to the Investors an aggregate of $ 2,700,000

in Common Stock as an Equity Kicker.

In addition, the Investors

received warrants representing the right, exercisable within five years of the closing date, of up to 50% of Common Stock issued as an

Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $ 115.00

in accordance with such private placement terms.

As of December

31, 2025, the Company has repaid the principal amount of $ 1,800,000

along with accrued interest of $ 67,146

and issued 75,418

shares of Common Stock and 377,092

warrants to the Investors.

Company recognized interest expense of nil and $ 103,938 towards other short-term loans on the accompanying unaudited condensed consolidated

statements of operations for the three months ended March 31, 2026, and March 31, 2025, respectively.

Company’s short-term loans with Endurance Antarctica Partners II, LLC and under the Term Sheets (including DRE

Chicago LLC, a related party) are described in Note 11, Related Party Transactions above and described in greater detail in Note 7 to the Company’s Form 10-K.

Both arrangements were fully repaid, together

with accrued interest, as of December 31, 2025, and carried no balance as of June 30, 2026.

The Company recognized interest expense

of $ 103,938 towards

other short-term loans on the accompanying unaudited condensed consolidated statements of operations for the six months

ended June 30, 2025.

following table summarizes the Company’s outstanding short-term loan arrangements:

OF SHORT TERM LOAN ARRANGEMENTS

31, 2025 (audited)

June 30, 2026

December 31, 2025

Insurance funding loan

NOTE 14 - LEASES

The Company has entered into a lease agreement with

Tower Lake LLC for office space.

The Company has not recognized any right-of-use asset or lease liability pursuant to this lease as it is a short-term

The Company recorded rent expense of $ 7,811 and $ 7,811 for the three months ended March 31, 2026, and 2025, respectively, in the

unaudited condensed consolidated statements of operations.

In February 2026, the Company entered into a

two-year sublease agreement with Chesmar Homes, LLC for office space located in Houston, Texas.

The monthly base rent under the

agreement is $ 8,761 and

the Company paid a security deposit of $ 17,523

upon execution of the sublease agreement.

and Subsidiaries

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Company has entered into a lease agreement with Tower Lake LLC for office space.

The Company has not recognized any right-of-use

asset or lease liability pursuant to this lease as it is a short-term lease.

The Company recorded rent expense of $ 7,811 for

the three months ended June 30, 2026 and 2025 and $ 15,621 for

the six months ended June 30, 2026, and 2025, in the unaudited condensed consolidated statements of

February 2026, the Company entered into a two-year sublease agreement expiring on February 29, 2028, with Chesmar Homes, LLC for office

space located in Houston, Texas.

The monthly base rent under the agreement is $ 8,761

and the Company paid a security deposit of $ 17,523

upon execution of the sublease agreement, 50% of which will

be adjusted against the final lease payment.

The lease was contractually scheduled to commence on March 1, 2026.

However, as the

Company had not obtained control of the underlying asset, including physical possession, as of March 31, 2026, the lease had not

commenced under ASC 842, “ Leases ”.

The Company currently expects the lease to commence in May 2026.

Upon commencement, the Company will

recognize a right-of-use asset and corresponding lease liability.

However, as the Company

obtained control of the underlying asset, including physical possession, on May 1, 2026, the lease commenced on May 1, 2026, under ASC

842, “Leases”.

The Company recognized a right-of-use asset and corresponding lease liability of $ 173,254

as of May 1, 2026.

Company incurred operating lease cost of $ 17,524 for

the three and six months ended June 30, 2026.

Cash paid for amounts included in the measurement of operating lease liabilities was

$ 17,524 for both the three and six months ended June 30, 2026, and is classified within operating activities in the condensed

consolidated statement of cash flows.

The weighted average remaining term of operating leases was 1.67 years

as of June 30, 2026, and the weighted-average discount rate used to measure the present value of the operating lease liabilities was 12.5 %

as of May 1, 2026.

As of June 30, 2026, the operating lease right-of-use

asset was $ 157,444 , and the operating lease liability of $ 157,444 was classified as $ 90,527 current and $ 66,917 non-current in the unaudited

condensed consolidated balance sheet.

operating lease payments as of June 30, 2026, were as follows:

OF OPERATING LEASE PAYMENTS

Remainder of 2026

Total future lease payments

Less imputed interest

Total operating lease liability balance

15 – PROMISSORY NOTES AND WRITE-OFFS

August 19, 2024, Legacy Stardust Power entered into a promissory note arrangement with IGX Minerals LLC (“ IGX ”) (the “ IGX

Note ”) for $ 176,000 .

Both arrangements are described in the Company’s Form 10-K.

During the three

months ended June 30, 2025, the Company wrote off the promissory note balance, including interest, in the amount of $ 182,481

as the note was deemed unrecoverable from IGX and the likelihood

of entering into definitive agreements with IGX had diminished significantly.

As a result, the Company recognized a loss of $ 182,481

in the Other Income/Expense section of the unaudited condensed

consolidated statement of operations for the three and six months ended June 30, 2025.

March 15, 2024, Legacy Stardust Power entered into a non-binding Letter of Intent with Usha Resources Ltd.

(“ Usha Resources ”)

to potentially acquire an interest in its Jackpot Lake lithium brine project, paying a non-refundable exclusivity payment of $ 25,000 .

A further non-refundable $ 50,000

payment was made on May 14, 2024.

Both arrangements are described

in the Company’s Form 10-K.

As of June 30, 2025, the Company determined that

the likelihood of entering into definitive agreements with Usha Resources Ltd.

had diminished significantly and wrote off the $ 50,000

deposit balance.

The Company recognized a loss of $ 50,000

in the Other Income/Expense section of the unaudited condensed

consolidated statement of operations for the three and six months ended June 30, 2025.

16 – SUBSEQUENT EVENTS

April 24, 2026, the Company was notified by the listing qualifications staff of Nasdaq that the Company did not satisfy the minimum $35

million market value of the listed securities requirement for 30 consecutive business days, as required under Nasdaq Listing Rule 5550(b)(2)

for the Nasdaq Capital Market (the “ MVLS Requirement ”).

Nasdaq also noted that the Company does not meet the requirements under

Listing Rules 5550(b)(1) and 5550(b)(3).

In accordance with Nasdaq rules, the Company has a period of 180 calendar days (or until October

21, 2026) to regain compliance with the MVLS Requirement.

To the extent the Company seeks to regain compliance through the MVLS Requirement,

the Company’s market value of listed securities must close at $35 million or more for a minimum of 10 consecutive business days

during the 180-day compliance period.

The notification received has no immediate effect on the listing of Stardust’s securities

on The Nasdaq Capital Market.

Company has evaluated subsequent events through the date the unaudited condensed consolidated financial statements were available to

be issued and there are no other items that would have had a material impact on the Company’s unaudited condensed consolidated

financial statements.

Other than as disclosed above, there are no additional subsequent events that would have a material impact on the Company’s

unaudited condensed consolidated financial statements.

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

What changed 10-Q

Item 1. Financial Statements