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Item 1. Financial Statements

2026-08-11 compared with 2026-05-12 · 143 added, 74 removed, 548 unchanged (28% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts) March 31, 2026 December 31, 2025

(in thousands, except share and per share amounts) June 30, 2026 December 31, 2025

Current assets:

24 unchanged sentences

Stockholders’ equity

Class A common stock, par value $ 0.0001 per share, 22,049,621 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively

Class C common stock, par value $ 0.0001 per share, 22,500,000 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively

Class A common stock, par value $ 0.0001 per share, 22,049,621 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively

Class C common stock, par value $ 0.0001 per share, 22,500,000 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively

Additional paid in capital 65,153 64,070

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(in thousands, except share and per share amounts) 2026 2025 2026 2025

4 unchanged sentences

Loss before income taxes ( 2,046 ) ( 2,574 ) ( 4,393 ) ( 5,225 )

Income tax expense 46 53

Income tax expense (benefit) ( 106 ) ( 28 ) ( 60 ) 25

Net loss $ ( 1,940 ) $ ( 2,546 ) $ ( 4,333 ) $ ( 5,250 )

8 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended March 31, 2026

Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended June 30, 2026

(in thousands, except share and per share amounts) Class A

5 unchanged sentences

Shares Values Shares Values

Balance – December 31, 2025 22,049,621 $ 2 22,500,000 $ 2 $ 64,070 $ ( 34,215 ) $ 28,276 $ 58,135

Balance – March 31, 2026 22,049,621 $ 2 22,500,000 $ 2 $ 64,666 $ ( 35,422 ) $ 27,090 $ 56,338

Share-based compensation - - - - 486 - - 486

Tax distributions to Class C OpCo unitholders - - - - - - ( 140 ) ( 140 )

Net loss - - - - - ( 907 ) ( 1,033 ) ( 1,940 )

Other - - - - 1 - - 1

Balance – June 30, 2026 22,049,621 $ 2 22,500,000 $ 2 $ 65,153 $ ( 36,329 ) $ 25,917 $ 54,745

Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended June 30, 2025

(in thousands, except share and per share amounts) Class A

Common Class C

Common Additional

Capital Accumulated

Interest Total

Stockholders’

Shares Values Shares Values

Balance – March 31, 2025 22,049,621 $ 2 22,500,000 $ 2 $ 62,246 $ ( 28,504 ) $ 33,996 $ 67,742

Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended March 31, 2025

Issuance of Class A common stock to Cottonmouth - - - - - - - -

Share-based compensation - - - - 495 - - 495

Equity offering cost adjustment - - - - 56 - - 56

Net loss - - - - - ( 1,260 ) ( 1,286 ) ( 2,546 )

Balance – June 30, 2025 22,049,621 $ 2 22,500,000 $ 2 $ 62,797 $ ( 29,764 ) $ 32,710 $ 65,747

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

VERDE CLEAN FUELS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Condensed Consolidated Statement of Stockholders’ Equity for the Six Months Ended June 30, 2026

(in thousands, except share and per share amounts) Class A

8 unchanged sentences

Share-based compensation - - - - 1,083 - - 1,083

Tax distributions to Class C OpCo unitholders - - - - - - ( 140 ) ( 140 )

Rebalancing of ownership percentage for issuance of Class A shares - - - - - - - -

Net loss - - - - - ( 2,114 ) ( 2,219 ) ( 4,333 )

Balance – March 31, 2025 22,049,621 $ 2 22,500,000 $ 2 $ 62,246 $ ( 28,504 ) $ 33,996 $ 67,742

Balance – June 30, 2026 22,049,621 $ 2 22,500,000 $ 2 $ 65,153 $ ( 36,329 ) $ 25,917 $ 54,745

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

VERDE CLEAN FUELS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Condensed Consolidated Statement of Stockholders’ Equity for the Six Months Ended June 30, 2025

(in thousands, except share and per share amounts) Class A

Common Class C

Common Additional

Capital Accumulated

Shares Values Shares Values Total

Stockholders’

Balance – December 31, 2024 9,549,621 $ 1 22,500,000 $ 2 $ 37,503 $ ( 27,257 ) $ 10,434 $ 20,683

Issuance of Class A common stock to Cottonmouth 12,500,000 1 - - 49,345 - - 49,346

Share-based compensation - - - - 912 - - 912

Rebalancing of ownership percentage for issuance of Class A shares - - - - ( 25,019 ) - 25,019 -

Equity offering cost adjustment - - - - 56 - - 56

Net loss - - - - - ( 2,507 ) ( 2,743 ) ( 5,250 )

Balance – June 30, 2025 22,049,621 $ 2 22,500,000 $ 2 $ 62,797 $ ( 29,764 ) $ 32,710 $ 65,747

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

VERDE CLEAN FUELS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

(in thousands) 2026 2025

7 unchanged sentences

Changes in operating assets and liabilities

Accounts receivable - other 4 -

Prepaid expenses ( 324 ) ( 5 )

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Accounts receivable for reimbursement of capital expenditures (at period end) $ - $ 1,006

Equity issuance costs in accounts payable and accrued liabilities (at period end) $ - $ 560

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

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These announcements are part of the Company’s continued advancement of its previously announced restructuring and cost reduction initiatives.

Burdette succeeds Ernie Miller who has stepped down from his role as CEO to pursue another opportunity.

Burdette succeeded Ernie Miller who stepped down from his role as CEO to pursue another opportunity.

Miller remains with the Company as a senior advisor.

1 unchanged sentence

See Notes 7 and 9 for further information.

On June 3, 2026, Martijn Dekker informed the Company's board of directors (the "Board") of his resignation as a director effective as of that same date.

On June 12, 2026, the Company held its 2026 Annual Meeting of Stockholders (the "Annual Meeting") and the stockholders re-elected Jonathan Siegler to serve as the sole Class III director until the 2029 annual meeting of stockholders.

Claire did not stand for re-election as a Class III director and, consequently, ceased to serve as a director as well as a member of the Company's audit committee (“Audit Committee”) following the Annual Meeting.

Immediately following the Annual Meeting, Ron Hulme replaced Ms.

Claire as a member of the Company's Audit Committee.

The Board determined to decrease the total number of directors from eight to six effective as of the Annual Meeting.

See Notes 7 and 8 for further information.

Business Combination

On February 15, 2023 (the “Closing Date”), the Company consummated (the “Closing”) a business combination (the “Business Combination”) pursuant to a Business Combination Agreement, dated as of August 12, 2022 (the “Business Combination Agreement”) by and among CENAQ Energy Corp.

(“CENAQ”), Verde Clean Fuels OpCo, LLC, a Delaware limited liability company and a wholly owned subsidiary of CENAQ (“OpCo”), Holdings, Bluescape Clean Fuels Intermediate Holdings, LLC, a Delaware limited liability company (“Intermediate”), and CENAQ Sponsor LLC (“Sponsor”).

(“CENAQ”), Verde Clean Fuels OpCo, LLC, a Delaware limited liability company and a wholly owned subsidiary of CENAQ (“OpCo”), Holdings, Bluescape Clean Fuels

Intermediate Holdings, LLC, a Delaware limited liability company (“Intermediate”), and CENAQ Sponsor LLC (“Sponsor”).

Immediately upon the completion of the Business Combination, CENAQ was renamed to Verde Clean Fuels, Inc.

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Additionally, the Company’s investments held in a short-term money market fund are not guaranteed by the FDIC.

As of March 31, 2026, the Company had not experienced losses on these accounts, and management believes the Company is not exposed to significant risks on such accounts.

As of June 30, 2026, the Company had not experienced losses on these accounts, and management believes the Company is not exposed to significant risks on such accounts.

Restricted Cash

6 unchanged sentences

Measurement of Credit Losses on Financial Instruments”, the Company’s accounts receivable are required to be presented at the net amount expected to be collected through an allowance for credit losses that are expected to occur over the life of the remaining life of the asset, rather than incurred losses.

The Company considers the amounts due from Cottonmouth to be fully collectible and, accordingly, there was no allowance for credit losses recorded by the Company as of March 31, 2026 and December 31, 2025.

The Company considers the amounts due from Cottonmouth to be fully collectible and, accordingly, there was no allowance for credit losses recorded by the Company as of June 30, 2026 and December 31, 2025.

Other Current Assets

Other current assets primarily consist of prepaid expenses.

There were no deferred equity issuance costs as of March 31, 2026 and December 31, 2025 as the deferred equity issuance costs were recorded within additional paid-in capital for the year ended December 31, 2025 as a reduction to the proceeds received from the issuance of the Company's Class A common stock to Cottonmouth.

There were no deferred equity issuance costs as of June 30, 2026 and December 31, 2025 as the deferred equity issuance costs were recorded within additional paid-in capital for the year ended December 31, 2025 as a reduction to the proceeds received from the issuance of the Company's Class A common stock to Cottonmouth.

See Note 3 for further information.

1 unchanged sentence

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures” (“ASC 820”), approximates the carrying amounts represented in the unaudited condensed consolidated balance sheets, primarily due to their short-term nature.

The fair values of cash, restricted cash, cash equivalents, receivables, prepaid expenses, accounts payable and accrued expenses are estimated to approximate their respective carrying values as of March 31, 2026 and December 31, 2025 due to the short-term maturities of such instruments.

The fair values of cash, restricted cash, cash equivalents, receivables, prepaid expenses, accounts payable and accrued expenses are estimated to approximate their respective carrying values as of June 30, 2026 and December 31, 2025 due to the short-term maturities of such instruments.

In determining fair value, the valuation techniques consistent with the market approach, income approach and cost approach shall be used to measure fair value.

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Diluted loss per share of Class A common stock is computed by dividing net loss attributable to Class A common stockholders by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities.

Antidilutive instruments, including outstanding warrants, stock options, certain restricted stock units (“RSUs”) and Sponsor earn out shares, were excluded from diluted earnings per share for the three months ended March 31, 2026 and 2025 because the inclusion of such instruments would be anti-dilutive.

Antidilutive instruments, including outstanding warrants, stock options, certain restricted stock units (“RSUs”) and Sponsor earn out shares, were excluded from diluted earnings per share for the three and six months ended June 30, 2026 and 2025 because the inclusion of such instruments would be anti-dilutive.

As a result, diluted net loss per share of common stock is the same as basic net loss per share of common stock for all periods presented.

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The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.

There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2026 and December 31, 2025.

There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of June 30, 2026 and December 31, 2025.

The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

The Company is subject to income tax examinations by major taxing authorities since inception.

See Note 12 for further information.

Tax Distributions

If the amount distributed by OpCo to its unitholders with respect to a fiscal year is less than such unitholders assumed tax liability in respect of such fiscal year, OpCo shall distribute an amount of available cash to its unitholders pro rata in an amount sufficient to cause each OpCo unitholder to receive a tax distribution at least equal to such unitholder’s assumed tax liability for such fiscal year.

The assumed tax liability will be calculated considering the Company's net taxable income multiplied by the assumed tax rate considering the combined effective U.S.

federal, state, and local rate of tax applicable to the Company for the applicable taxable year unless otherwise determined by OpCo.

If reasonably practicable, OpCo will make such tax distributions on a quarterly basis.

Tax distributions to Class A OpCo unitholders are treated as a reduction to additional paid in capital and eliminated in consolidation.

Tax distributions to Class C OpCo unitholders are treated as a reduction to noncontrolling interest.

See Note 12 for further information.

Property, Plant and Equipment

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The Company accounts for leases under ASC 842, “Leases” (“ASC 842”).

The core principle of this standard is that a lessee should recognize the assets and liabilities that arise from leases by recognizing a liability to make lease payments (the lease liability) and a right-of-use asset (“ROU asset”) representing the lessee’s right to use, or control the use of, the underlying asset for the lease term.

underlying asset for the lease term.

In accordance with the guidance of ASC 842, leases are classified as finance or operating leases, and both types of leases are recognized in the unaudited condensed consolidated balance sheets.

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This classification dictates whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease.

For all lease arrangements with a term of

greater than 12 months, the Company presents at the commencement date:

For all lease arrangements with a term of greater than 12 months, the Company presents at the commencement date:

a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis;

13 unchanged sentences

Unit-Based Compensation

Service-based units compensation cost is measured at the grant date based on the fair value of the equity instruments awarded and is recognized over the period during which an employee is required to provide service in exchange for the award, or the requisite service period, which is usually the vesting period.

award, or the requisite service period, which is usually the vesting period.

Performance-based unit compensation cost is measured at the grant date based on the fair value of the equity instruments awarded and is expensed over the requisite service period, based on the probability of achieving the performance goal, with changes in expectations recognized as an adjustment to earnings in the period of the change.

23 unchanged sentences

RSUs represent an unsecured right to receive one share of the Company’s Class A common stock equal to the per share value of the Class A common stock on the settlement date.

RSUs have a zero-exercise price and vest over time in whole after the first anniversary of the date of grant subject to continuous service through the vesting date.

RSUs have a zero-exercise price and generally vest over time in whole at a future date, subject to continuous service through the vesting date.

See Note 9 for further information.

4 unchanged sentences

The Company’s equity attributable to NCI and the Class A common stockholders are rebalanced to reflect changes in ownership, as applicable.

See "Tax Distributions" in this Note 2 and Note 12 for further information.

Recent Accounting Standards

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Additionally, in connection with the consummation of the transactions contemplated by the Purchase Agreement, the Company amended and restated its fourth amended and restated certificate of incorporation (the “Restated Charter”).

In accordance with the Restated Charter, effective January 29, 2025, the Company (i) increased the number of authorized shares of Class C common stock from 25,000,000 to 26,000,000 and (ii) increased the size of its Board of Directors from seven to eight and to provide Cottonmouth with certain director designation and Board observer rights.

In accordance with the Restated Charter, effective January 29, 2025, the Company (i) increased the number of authorized shares of Class C common stock from 25,000,000 to 26,000,000 and (ii) increased the size of its Board from seven to eight directors and to provide Cottonmouth with certain director designation and Board observer rights.

The Restated Charter was approved and recommended by the Board prior to stockholder action by written consent.

8 unchanged sentences

Intangible Assets

As of December 31, 2025, the Company also evaluated the recoverability its intellectual property (“IP”) intangible assets in light of changing market conditions driven by increasing demand for natural gas in the Permian Basin.

As of December 31, 2025, the Company also evaluated the recoverability of its intellectual property (“IP”) intangible assets in light of changing market conditions driven by increasing demand for natural gas in the Permian Basin.

The Company determined that changing market conditions related to natural gas in the Permian Basin were specific to a particular feedstock and region whereas its IP assets that support the STG+® technology can be applied to produce fully finished liquid fuels from diverse feedstocks in various regions where low-value or stranded feedstocks may be present.

2 unchanged sentences

The Company's major classes of property, plant and equipment are as follows:

(in thousands) March 31, 2026 December 31, 2025

(in thousands) June 30, 2026 December 31, 2025

Computers, office equipment and hardware $ 41 $ 42

9 unchanged sentences

The Company’s accrued liabilities are as follows:

(in thousands) March 31, 2026 December 31, 2025

(in thousands) June 30, 2026 December 31, 2025

Accrued compensation $ 675 $ 468

5 unchanged sentences

Total accrued liabilities $ 1,141 $ 906

As of June 30, 2026, the Company's other accrued expenses consisted of contingency expense recorded during the three and six months ended June 30, 2026.

NOTE 7 – RELATED PARTY TRANSACTIONS

The Company has a related party relationship with Holdings whereby Holdings holds a majority ownership in the Company via voting shares and has control of its Board of Directors.

The Company has a related party relationship with Holdings whereby Holdings holds a majority ownership in the Company via voting shares and has control of its Board.

Further, Holdings possesses 3,500,000 earn out shares.

The Holdings equity compensation instruments consist of 1,000 authorized and issuable Series A Incentive Units (the “Series A Incentive Units”) and 1,000 authorized and issuable Founder Incentive Units (the “Founder Incentive Units”).

Certain of the Company’s management hold Series A Incentive Units and Founder Incentive Units that entitle them to participate in the earnings of and distributions by Holdings after a specified return to the Series A Preferred Unit holders.

Certain of the Company’s employees and officers hold Series A Incentive Units and Founder Incentive Units that entitle them to participate in the earnings of and distributions by Holdings after a specified return to the Series A Preferred Unit holders.

See Notes 1, 9 and 11 for further information.

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The letter agreement purports to grant Five Star Clean Fuels certain non-exclusive rights to utilize the STG+® technology and reflects an intent to enter into mutually acceptable to be negotiated agreements related to a potential site in Odessa, Texas.

Martijn Dekker, a Company director, is an officer and director of Five Star Clean Fuels and his affiliate has an ownership interest in Five Star Clean Fuels.

See Note 8 for further information.

On June 3, 2026, Martijn Dekker informed the Company's Board of his resignation as a director effective as of that same date.

As of the date of his resignation, the Company understood that Mr.

Dekker was an officer and director of Five Star Clean Fuels and his affiliate owned an interest in Five Star Clean Fuels.

See Notes 1 and 8 for further information.

NOTE 8 – COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

The Company's lease for its office in Houston is through February 2027.

During the three months ended March 31, 2026, the Company extended its lease for its office and demonstration plant in Hillsborough, New Jersey through April 30, 2027.

During the six months ended June 30, 2026, the Company extended its lease for its office and demonstration plant in Hillsborough, New Jersey through April 30, 2027.

See Note 1 for further information.

For the three months ended March 31, 2026 and 2025, the Company determined that the rent portion of such leases qualified as an operating lease under ASC 842.

For the three months ended March 31, 2026 and 2025, the Company had expenses related to its operating leases as follows:

For the three and six months ended June 30, 2026 and 2025, the Company determined that the rent portion of such leases qualified as an operating lease under ASC 842.

For the three and six months ended June 30, 2026 and 2025, the Company had expenses related to its operating leases as follows:

(in thousands) Statements of Operations Three Months Ended

June 30, Six Months Ended

Lease Cost Classification 2026 2025 2026 2025

2 unchanged sentences

Total operating lease cost $ 156 $ 140 $ 311 $ 282

For the three months ended March 31, 2026 and 2025, supplemental information related to the Company’s operating lease arrangements are as follows:

(in thousands) Three Months Ended

For the six months ended June 30, 2026 and 2025, supplemental information related to the Company’s operating lease arrangements are as follows:

(in thousands) Six Months Ended

Operating lease – supplemental information 2026 2025

2 unchanged sentences

Discount rate – operating leases 7.50 % 7.50 %

As of March 31, 2026 and December 31, 2025, the Company had restricted cash of $ 100 .

As of June 30, 2026 and December 31, 2025, the Company had restricted cash of $ 100 .

See Note 2 for further information.

Contingencies

In May 2024, the Company and Koch Modular Process Systems, LLC ("KMPS") entered into a license agreement for certain front-end engineering and design ("FEED") work product prepared by KMPS related to the Permian Basin Project.

The FEED study for the Permian Basin Project was completed in December 2025.

In the event that the Company desires to obtain ownership rights to the FEED work product prepared by KMPS, such ownership could be obtained upon (i) KMPS being awarded a supply contract for the reaction and distillation modular system for the first commercial production facility utilizing the Company's STG+® technology or (ii) payment to KMPS of $ 1.0 million.

See Note 3 for further information.

On February 27, 2026, Five Star Clean Fuels filed an original petition against the Company seeking a declaratory judgment that a letter agreement between a subsidiary of the Company and a predecessor of Five Star Clean Fuels constituted a binding contract that effectuates a grant to Five Star Clean Fuels of certain non-exclusive rights to utilize the STG+® technology.

2 unchanged sentences

At this time, the Company is unable to reasonably estimate a possible financial loss or range of financial loss, if any, that may be incurred to resolve this matter.

As of March 31, 2026 and December 31, 2025, the Company had not recorded any contingent liabilities.

See Notes 1 and 7 for further information.

As of June 30, 2026 and December 31, 2025, the Company had not recorded any contingent liabilities.

NOTE 9 – STOCKHOLDERS' EQUITY

3 unchanged sentences

As consideration for the contribution of the equity interests in Intermediate, Holdings received earn out consideration (“Holdings earn out”) of 3,500,000 shares of Class C common stock and a corresponding number of Class C OpCo Units subject to vesting with the achievement of separate market conditions.

One half of the Holdings earn out shares will meet the market condition when the volume-weighted average share price (“VWAP”) of the Class A common stock is greater

than or equal to $ 15.00 for any 20 trading days within any period of 30 consecutive trading days within five years of the Closing Date.

One half of the Holdings earn out shares will meet the market condition when the volume-weighted average share price (“VWAP”) of the Class A common stock is greater than or equal to $ 15.00 for any 20 trading days within any period of 30 consecutive trading days within five years of the Closing Date.

The second half will vest when the VWAP of the Class A common stock is greater than or equal to $ 18.00 over the same measurement period.

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The Earn Out Equity was issued in connection with the Business Combination on February 15, 2023.

Holdings earn out shares are neither issued nor outstanding as of March 31, 2026 as the performance requirements for vesting were not achieved.

All Sponsor Shares granted in connection with the Business Combination were issued and outstanding as of March 31, 2026 and December 31, 2025.

Holdings earn out shares are neither issued nor outstanding as of June 30, 2026 as the performance requirements for vesting were not achieved.

All Sponsor Shares granted in connection with the Business Combination were issued and outstanding as of June 30, 2026 and December 31, 2025.

Sponsor Shares subject to forfeiture pursuant to the above terms that do not vest in accordance with such terms shall be forfeited.

Based on the trading price of the Company's Class A common stock, the market conditions were not met and no shares of Earn Out Equity were vested as of March 31, 2026.

Based on the trading price of the Company's Class A common stock, the market conditions were not met and no shares of Earn Out Equity were vested as of June 30, 2026.

Share-based Compensation

For the three months ended March 31, 2026 and 2025, the Company had share-based compensation expense of $ 597 and $ 417 , respectively.

For the three and six months ended June 30, 2026, the Company had share-based compensation expense of $ 486 and $ 1,083 .

For the three and six months ended June 30, 2025, the Company had share-based compensation expense of $ 495 and $ 912 , respectively.

Stock Options

During the three months ended March 31, 2026, the Company had changes in stock options as follows:

During the six months ended June 30, 2026, the Company had changes in stock options as follows:

options Weighted

4 unchanged sentences

Forfeited / expired ( 645,242 ) $ 5.68 -

Outstanding as of March 31, 2026 5,276,414 $ 6.57 5.0

Unvested as of March 31, 2026 3,641,089 $ 5.94 5.6

Exercisable as of March 31, 2026 965,457 $ 5.86 4.1

As of March 31, 2026, there were 4,282,155 options granted to employees and officers outstanding, of which 3,087,392 were unvested, and 994,259 options granted to non-employee directors outstanding, of which 553,697 were unvested.

As of March 31, 2026, unrecognized compensation expense related to unvested stock options was $ 3,331 , and the remaining compensation cost is expected to be recognized over a weighted-average period of 1.7 years.

For the three months ended March 31, 2026 and 2025, there was no cash received from the exercise of stock options.

As of March 31, 2026, there was no intrinsic value for all stock option awards.

Outstanding as of June 30, 2026 5,276,414 $ 6.57 4.8

Unvested as of June 30, 2026 2,125,120 $ 5.87 5.4

Exercisable as of June 30, 2026 2,233,485 $ 5.41 4.9

As of June 30, 2026, there were 4,282,155 options granted to employees and officers outstanding, of which 2,157,035 were vested.

As of June 30, 2026, there were 994,259 options granted to non-employee directors outstanding, all of which were vested.

As of June 30, 2026, unrecognized compensation expense related to unvested stock options was $ 2,844 , and the remaining compensation cost is expected to be recognized over a weighted-average period of 1.7 years.

For the six months ended June 30, 2026 and 2025, there was no cash received from the exercise of stock options.

As of June 30, 2026, there was no intrinsic value for all stock option awards.

See Notes 2 and 11 for further information.

2 unchanged sentences

In May 2024, the Company settled 120,824 of the vested RSUs through issuance of 120,824 shares of Class A common stock.

As of March 31, 2026, the Company has not yet settled 20,832 of the vested RSUs, as the awardee elected to defer receipt.

As of June 30, 2026, the Company has not yet settled 20,832 of the vested RSUs, as the awardee elected to defer receipt.

The Company includes the vested and deferred RSUs within weighted-average shares outstanding for the computation of basic and diluted loss per share.

For the three months ended March 31, 2026 and 2025, the Company did not record any RSU compensation expense.

For the six months ended June 30, 2026 and 2025, the Company did not record any RSU compensation expense.

See Notes 2 and 11 for further information.

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The Company continues to evaluate the conditions related to the Founder Incentive Units.

As of March 31, 2026, such conditions continue to not have been met.

As of June 30, 2026, such conditions continue to not have been met.

See Notes 1 and 7 for further information.

NOTE 10 – WARRANTS

There were 15,383,263 warrants outstanding as of March 31, 2026 (the “Warrants”).

There were 15,383,263 warrants outstanding as of June 30, 2026 (the “Warrants”).

Each Warrant entitles the registered holder to purchase one share of Class A common stock at a price of $ 11.50 per share, subject to adjustment as discussed below.

3 unchanged sentences

In the event of such cashless exercise, each holder would pay the exercise price by surrendering the Warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the Warrants, multiplied by the difference between the exercise price of the Warrants and the “fair market value” (defined below) by (y) the fair market value.

“fair market value” for this purpose will mean the average reported last sale price of the shares of Class A common stock for the five trading days ending on the trading day prior to the date of exercise.

The “fair market value” for this purpose will mean the average reported last sale price of the shares of Class A common stock for the five trading days ending on the trading day prior to the date of exercise.

The Warrants will expire on February 15, 2028, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.

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If and when the Warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws.

During the three months ended March 31, 2026 and 2025, no Warrants were exercised.

During the six months ended June 30, 2026 and 2025, no Warrants were exercised.

NOTE 11 – LOSS PER SHARE

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(in thousands, except share and per share amounts) 2026 2025 2026 2025

8 unchanged sentences

However, securities that could potentially be dilutive are excluded from the computation of diluted earnings per share when a loss from continuing operations exists or when the exercise price exceeds the average closing price of the Company’s Class A common stock during the period, because their inclusion would result in an anti-dilutive effect on per share amounts.

As of March 31, 2026, the Company has not yet settled 20,832 of the vested RSUs, as the awardee elected to defer receipt.

As of June 30, 2026, the Company has not yet settled 20,832 of the vested RSUs, as the awardee elected to defer receipt.

The Company includes the vested and deferred RSUs within weighted-average shares outstanding for the computation of basic and diluted loss per share.

1 unchanged sentence

The following amounts were not included in the calculation of net loss per diluted share for the periods presented because their effects were anti-dilutive:

As of March 31,

As of June 30,

(in shares) 2026 2025

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Noncontrolling Interests

As of March 31, 2026 and December 31, 2025, the ownership interests of the Class A common stockholders and the NCI were 49.49 % and 50.51 %, respectively.

As of June 30, 2026 and December 31, 2025, the ownership interests of the Class A common stockholders and the NCI were 49.49 % and 50.51 %, respectively.

The ownership interests reflects the issuance of the Company's Class A common stock to Cottonmouth during the year ended December 31, 2025.

See Note 3 for further information.

NOTE 12 – INCOME TAX

As of March 31, 2026, the Company holds 49.49 % of the economic interest in OpCo, which is treated as a partnership for U.S.

NOTE 12 – TAX

As of June 30, 2026, the Company holds 49.49 % of the economic interest in OpCo, which is treated as a partnership for U.S.

federal income tax purposes.

As a partnership, OpCo generally is not subject to U.S.

federal income tax under current U.S.

federal income tax under current

The Company is subject to U.S.

federal income taxes, in addition to state and local income taxes, with respect to its distributive share of the net taxable income (loss) and any related tax credits of OpCo.

For the three months ended March 31, 2026 and 2025, the Company’s effective tax rate was ( 2.0 )%.

The Company’s effective income tax rate was 5.2 % and 1.4 % for the three and six months ended June 30, 2026, respectively, and was 1.1 % and ( 0.5 )% for the three and six months ended June 30, 2025, respectively.

The effective income tax rates for each period differed significantly from the statutory rate primarily due to the losses allocated to NCI and the recognition of a valuation allowance as a result of the Company’s tax structure.

The Company has assessed the realizability of its net deferred tax assets and that analysis has considered the relevant positive and negative evidence available to determine whether it is more likely than not that some portion or all of the deferred tax assets will be realized.

As of March 31, 2026, the Company has maintained a full valuation allowance against its deferred tax assets, which will be maintained until there is sufficient evidence to support the reversal of all or some portion of the allowance.

As of June 30, 2026, the Company has maintained a full valuation allowance against its deferred tax assets, which will be maintained until there is sufficient evidence to support the reversal of all or some portion of the allowance.

The Company’s income tax filings will be subject to audit by various taxing jurisdictions.

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income tax for businesses, including bonus depreciation for qualified tangible property, immediate expensing of research expenditures, and updates to the calculation of disallowed interest.

For the three months ended March 31, 2026, the Company recognized the provisions of the OBBB Act in determining its income tax expense, including immediate expensing of research expenditures.

For the three and six months ended June 30, 2026, the Company recognized the provisions of the OBBB Act in determining its income tax expense, including immediate expensing of research expenditures.

Tax Distributions

For the three and six months ended June 30, 2026 and 2025, the Company recorded tax distributions to Class C OpCo unitholders of $ 140 and $ 0 , respectively.

Tax Receivable Agreement

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federal, state and local income and franchise tax that the Company actually realizes (computed using certain simplifying assumptions) or is deemed to realize in certain circumstances in periods after the Closing Date as a result of, as applicable to each such TRA Holder, (i) certain increases in tax basis that occur as a result of the Company’s acquisition (or deemed acquisition for U.S.

federal income tax purposes) of all or a portion of such TRA Holder’s Class C OpCo Units pursuant to the exercise of the OpCo

Exchange Right, a Mandatory Exchange or the Call Right (each as defined in the Amended and Restated LLC Agreement of OpCo) and (ii) imputed interest deemed to be paid by the Company as a result of, and additional tax basis arising from, any payments the Company makes under the Tax Receivable Agreement.

federal income tax purposes) of all or a portion of such TRA Holder’s Class C OpCo Units pursuant to the exercise of the OpCo Exchange Right, a Mandatory Exchange or the Call Right (each as defined in the Amended and Restated LLC Agreement of OpCo) and (ii) imputed interest deemed to be paid by the Company as a result of, and additional tax basis arising from, any payments the Company makes under the Tax Receivable Agreement.

The Company will retain the benefit of the remaining 15 % of these net cash savings.

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The payment cap would not be reduced or offset by any amounts previously paid under the Tax Receivable Agreement or any amounts that are required to be paid (but have not yet been paid) for the year in which the change of control occurs or any prior years.

As of March 31, 2026 and December 31, 2025, the Company did not record a tax receivable liability.

For the three and six months ended June 30, 2026 and 2025, the Company did not record a liability related to the Tax Receivable Agreement.

NOTE 13 - SEGMENT INFORMATION

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The Company’s CODM is its CEO.

The Company has determined that it operates in one operating segment, as the CODM reviews financial information presented on a combined basis for purposes of making operating decisions, allocating resources, and evaluating financial performance.

The Company has determined that it operates in one operating segment, as the CODM reviews financial information presented on a combined basis for purposes

of making operating decisions, allocating resources, and evaluating financial performance.

The Company’s segment reporting is consistent with its internal reporting to its CODM.

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Other segment items represent the difference between reported significant segment expenses and consolidated operating loss.

For the three months ended March 31, 2026 and 2025, the Company's operating loss by significant segment expenses were as follows:

Three Months Ended

(in thousands) March 31, 2026 March 31, 2025

For the three and six months ended June 30, 2026 and 2025, the Company's operating loss by significant segment expenses were as follows:

Three Months Ended Six Months Ended

(in thousands) June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025

Outside services $ 572 $ 1,042 $ 1,391 $ 2,289

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

What changed 10-Q

Item 1. Financial Statements