Financial Performance - For the year ended December 31, 2025, Talkspace's revenues increased to $228.9 million, up from $187.6 million in 2024, representing a growth of approximately 22%[282] - Total revenue increased by $41.3 million, or 22.0%, to $228.9 million for the year ended December 31, 2025, primarily due to a 37.9% increase in Payor revenue[314] - Payor revenue reached $171.5 million, up from $124.3 million, driven by a 31.5% increase in completed Payor sessions[314] - Consumer revenue decreased by $7.3 million, or 29.5%, to $17.5 million, primarily due to a 30.0% decline in Consumer active members[314] - Net income increased by $6.6 million, or 578.8%, to $7.8 million for the year ended December 31, 2025[312] - Adjusted EBITDA rose to $15.8 million for the year ended December 31, 2025, compared to $7.0 million for the year ended December 31, 2024[328] Customer Metrics - The number of completed sessions related to Payor customers rose to 1,617,000 in 2025, compared to 1,229,200 in 2024, indicating a growth of about 31.6%[282] - As of December 31, 2025, the number of health plan customers increased to 35, up from 27 in 2024, while the number of enterprise customers decreased to 159 from 188[297] - The company reported approximately 5,000 active Consumer members as of December 31, 2025, down from 7,200 in 2024, reflecting a decline of about 30.6%[282] - Unique Payor active members during the fourth quarter of 2025 were 124.1 thousand, compared to 95.7 thousand in the same period of 2024, showing an increase of approximately 29.6%[297] Mergers and Acquisitions - The pending merger with Universal Health Services, Inc. will result in each share of Talkspace common stock being converted into $5.25 in cash, with the transaction expected to close in Q3 2026[284][287] - Talkspace acquired Wisdo Health on October 1, 2025, enhancing its ability to address loneliness and isolation, which affects nearly half of U.S. adults[291] Expenses and Costs - Cost of revenue, excluding depreciation and amortization, increased by $29.2 million, or 28.8%, to $130.5 million, primarily due to a 21.7% increase in hours worked by therapists[315] - Research and development expenses decreased by $0.7 million, or 7.2%, to $9.5 million, mainly due to a reduction in employee-related costs[316] - The company anticipates incurring significant transaction-related costs associated with the merger, impacting its financials in fiscal year 2026[288] Cash Flow and Capital Position - As of December 31, 2025, the company maintained a strong capital position with $92.6 million in cash and cash equivalents[329] - Net cash provided by operating activities was $8.5 million for the year ended December 31, 2025, compared to $11.7 million for the previous year[334] - The company anticipates being able to fund its cash needs for at least the next 12 months using available cash and cash equivalents[331] - Net cash used in investing activities decreased to $28.9 million for the year ended December 31, 2025, from $46.7 million in 2024, primarily due to higher proceeds from maturities of marketable securities[335] - Net cash used in financing activities increased to $19.0 million for the year ended December 31, 2025, compared to $12.2 million in 2024, driven by increased repurchases of common stock[336] - As of December 31, 2025, the company had no short-term or long-term debt and only a non-material long-term operating lease for office space[337] Risk Factors - Inflation has not materially affected Talkspace's business for the years ended December 31, 2025, and 2024, but future inflationary pressures could impact costs[293] - The company does not believe that a hypothetical increase or decrease of 100 basis points in interest rates would materially affect its financial condition or results of operations[354] - A substantial majority of the company's revenue has been denominated in U.S. dollars, indicating limited exposure to foreign currency exchange risk[355] - The company has not incurred any material costs related to indemnifications for breaches of customer data or intellectual property rights[339] - There are no material legal proceedings or claims as of December 31, 2025, although future legal matters may arise in the normal course of business[338] Development and Compliance - Talkspace's research and development expenses include costs related to software development and compliance, which are critical for future product enhancements[303] - The company capitalizes certain costs related to the development of its proprietary virtual behavioral health platform, amortizing eligible costs over an estimated useful life of 3 years[344] - Stock-based compensation costs are measured at fair value on the grant date and recognized as expense over the requisite service period[345]

Financial Performance - For the year ended December 31, 2025, Talkspace's revenues increased to $228.9 million, up from $187.6 million in 2024, representing a growth of approximately 22%[282] - Total revenue increased by $41.3 million, or 22.0%, to $228.9 million for the year ended December 31, 2025, compared to $187.6 million for 2024, primarily driven by a 37.9% increase in Payor revenue[314] - Payor revenue reached $171.5 million, a $47.2 million increase, while Consumer revenue decreased by $7.3 million, or 29.5%, to $17.5 million due to a strategic focus on Payor members[314][315] - Net income increased significantly to $7.8 million for the year ended December 31, 2025, compared to $1.1 million in 2024, reflecting a 578.8% increase[312] - Adjusted EBITDA rose to $15.8 million for 2025, compared to $7.0 million in 2024, indicating improved operational performance[328] Customer Metrics - The number of completed sessions for Payor customers rose to 1,617,000 in 2025, compared to 1,229,200 in 2024, indicating a growth of about 31.6%[282] - Unique Payor active members increased to 124,100 in Q4 2025 from 95,700 in Q4 2024, reflecting a growth of approximately 29.6%[297] - As of December 31, 2025, the number of health plan customers increased to 35 from 27 in 2024, while the number of enterprise customers decreased to 159 from 188[297] Mergers and Acquisitions - Talkspace's pending merger with Universal Health Services, Inc. will result in shareholders receiving $5.25 per share in cash, with the transaction expected to close in Q3 2026[283][284] - The acquisition of Wisdo Health on October 1, 2025, aims to address loneliness and isolation, which affect nearly half of U.S. adults, enhancing Talkspace's service offerings[291] Operational Initiatives - Talkspace's clinical automation initiative, Sentia AI, aims to enhance member engagement while managing costs associated with AI technology[290] - The company capitalizes certain costs related to the development of its proprietary virtual behavioral health platform, amortizing eligible costs over an estimated useful life of 3 years[344] Cash Flow and Liquidity - Cash and cash equivalents decreased to $92.6 million as of December 31, 2025, from $117.8 million in 2024, with no debt reported[329] - Net cash provided by operating activities was $8.5 million for 2025, down from $11.7 million in 2024, primarily due to timing of customer payments[334] - Net cash used in investing activities decreased to $28.9 million for the year ended December 31, 2025, from $46.7 million in 2024, primarily due to higher proceeds from maturities of marketable securities[335] - Net cash used in financing activities increased to $19.0 million for the year ended December 31, 2025, compared to $12.2 million in 2024, driven by increased repurchases of common stock[336] - The company anticipates being able to fund its cash needs for at least the next 12 months using available cash and cash equivalents[331] Cost and Expense Management - Cost of revenue, excluding depreciation and amortization, increased by $29.2 million, or 28.8%, to $130.5 million, driven by a 21.7% increase in hours worked by therapists[315] - Research and development expenses decreased by $0.7 million, or 7.2%, to $9.5 million, primarily due to a reduction in employee-related costs[316] Tax and Regulatory Environment - Income tax expense increased by $0.5 million, or 510.6%, to $0.6 million for 2025, mainly due to U.S. State income taxes[322] - The One Big Beautiful Bill Act, enacted in July 2025, is expected to improve liquidity by increasing available deductions for future taxable income[294] Risk Factors - Inflation did not materially affect Talkspace's financial condition for the years ended December 31, 2025, and 2024, but future inflationary pressures could impact costs[293] - The company does not believe that a hypothetical 100 basis points increase or decrease in interest rates would materially affect its financial condition or results of operations[354] - A substantial majority of the company's revenue has been denominated in U.S. dollars, indicating limited exposure to foreign currency exchange risk[355] - As of December 31, 2025, the company had no short-term or long-term debt and only a non-material long-term operating lease for office space[337] - The company has not incurred any material costs related to indemnifications for breaches of customer data or intellectual property rights[339]

Earnings Announcement - Artesian Resources Corporation announced its earnings for the fourth quarter and year ended December 31, 2025, on March 12, 2026[4]. - The press release detailing the earnings is attached as Exhibit 99.1, which is incorporated by reference[4]. Company Information - The company is listed on The Nasdaq Stock Market under the trading symbol ARTNA[3]. - The report indicates that the information provided shall not be deemed "filed" under the Securities Exchange Act of 1934[4]. - The Chief Financial Officer, David B. Spacht, signed the report on March 13, 2026[10].

Revenue Performance - Research revenues increased from approximately 73% in 2024 to approximately 75% in 2025, indicating a growing reliance on subscription products [88]. - Total revenues for 2025 were composed of 74.5% from research, 22.2% from consulting, and 3.3% from events [99]. - Total revenues decreased by 8% in 2025 to $396.9 million from $432.5 million in 2024 [100]. - Research revenues declined by 7% to $295.6 million, primarily due to a decrease in CV and the divestiture of the FeedbackNow product line, which accounted for an approximate 1% revenue decline [100]. - Consulting revenues fell by 9% to $88.2 million due to lower client bookings and the decision to discontinue strategy consulting engagements [101]. - Events revenues decreased significantly by 29% to $13.1 million, primarily driven by a drop in sponsorship revenues [102]. - Research segment revenues decreased by 6% in 2025 compared to 2024, totaling $295,607 thousand, primarily due to a decline in CV and the divestiture of the FeedbackNow product line [128]. - Consulting segment revenues decreased by 13% in 2025 compared to 2024, totaling $66,229 thousand, attributed to lower client bookings [130]. - Event segment revenues decreased by 29% in 2025 compared to 2024, totaling $13,089 thousand, primarily due to a decrease in sponsorship revenues [132]. - Total segment revenues for 2025 were $396,888 thousand, reflecting an overall year-over-year revenue change of -8% [128]. Client Metrics - Contract value (CV) decreased by 6% from $311.9 million in 2024 to $292.4 million in 2025, attributed to a wallet retention of 87% and insufficient new client acquisition [91]. - Client retention improved by 4 percentage points from 73% in 2024 to 77% in 2025, driven by ongoing retention initiatives and the launch of the AI Access product [91]. - Wallet retention decreased by 2 percentage points from 89% in 2024 to 87% in 2025, primarily due to lower enrichment of contracts upon renewal [91]. - The number of clients decreased by 7% from 1,942 in 2024 to 1,797 in 2025, indicating challenges in client acquisition [91]. Financial Performance - Operating expenses increased, with cost of services and fulfillment at 43.0% and selling and marketing at 37.7% of total revenues for 2025 [99]. - Net loss for 2025 was 30.1%, a significant decline from a net loss of 1.3% in 2024, reflecting operational challenges and impairment charges [99]. - Goodwill impairment charges totaled $110.7 million in 2025, with $83.9 million recorded in Q1 and an additional $26.8 million in Q4 [96]. - Goodwill impairment charges totaled $83.9 million in Q1 2025 and an additional $26.8 million in Q4 2025, due to a decline in stock price and market conditions [109][110]. - The effective tax rate for 2025 was not applicable, reflecting a $8.4 million decrease in income tax expense due to non-deductible goodwill impairment charges [122]. Future Outlook - The company anticipates a decline in consulting revenues in 2026 by approximately 20% due to the cessation of strategy consulting [101]. - The company may need to perform a quantitative impairment test for goodwill in Q1 2026 due to continued stock price decline, which could materially impact future results [97]. Cash Flow and Investments - Cash generated from operating activities increased by $25.0 million in 2025, totaling $21.1 million, primarily due to a decrease in cash used for accrued expenses [134]. - Cash used in investing activities during 2025 was $14.1 million, mainly from net purchases of marketable investments and property and equipment [135]. - As of December 31, 2025, the company had cash, cash equivalents, and marketable investments totaling $127.7 million, including $87.8 million held outside the U.S. [142]. - The company has a credit facility with $35.0 million outstanding as of December 31, 2025, which was amended to extend its maturity to March 2029 and reduce the facility size to $50.0 million [138]. - The company plans to incur approximately $28.0 million in capital expenditures for renovations of its headquarters in Cambridge, Massachusetts, expected in the first half of 2026 [136].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 001-41315 John Marshall Bancorp, Inc. (Exact Name of Registrant as Specified in its Charter) (State or other jurisdiction of incorporation or organization) Virgini ...

Revenue Performance - Revenue from CyPath® Lung increased by 87% year-over-year, with total revenue for the company at $6.2 million, down from $9.4 million in 2024 due to strategic discontinuation of unprofitable services [15]. - Net revenue decreased to $6,161,959 in 2025 from $9,362,022 in 2024, representing a decline of approximately 34.5% [21]. - The forecast for unit sales of CyPath® Lung in 2026 reflects an increase of greater than 100% over 2025, with a corresponding increase in revenues [10]. Test Utilization and Market Demand - The number of CyPath® Lung tests performed rose by 99% compared to 2024, reflecting growing clinical utilization and physician adoption [3]. - Orders for CyPath® Lung by physicians and clinics increased by 67% year-over-year, driven by peer-to-peer marketing and positive real-world experiences [3]. - The market opportunity for CyPath® Lung is projected to exceed $4.7 billion by 2030, driven by a 62% increase in indeterminate pulmonary nodules detected in the U.S. [10]. Financial Position and Expenses - Operating expenses decreased by 9% to $16.7 million in 2025, primarily due to strategic actions aimed at streamlining operations [15]. - Total operating expenses were $16,734,467 in 2025, down from $18,315,467 in 2024, a reduction of about 8.6% [21]. - Research and development expenses were $1,383,359 in 2025, slightly down from $1,461,227 in 2024, a decrease of about 5.3% [21]. Losses and Financial Challenges - The net loss for 2025 was $14,909,754, compared to a net loss of $9,039,831 in 2024, indicating an increase in losses of approximately 65.5% [21]. - The company reported a loss from operations of $10,572,508 in 2025, which is an increase from the loss of $8,953,445 in 2024 [21]. Cash and Assets - Cash and cash equivalents as of December 31, 2025, were $6.5 million, compared to $1.1 million at the end of 2024 [15]. - Cash and cash equivalents rose to $6,449,782 in 2025 from $1,105,291 in 2024, an increase of approximately 484.5% [19]. - Total assets increased to $10,960,772 in 2025 from $6,513,667 in 2024, representing a growth of about 68.1% [19]. - Total liabilities decreased to $3,683,116 in 2025 from $3,911,631 in 2024, a reduction of approximately 5.8% [19]. - Stockholders' equity increased to $7,277,656 in 2025 from $2,602,036 in 2024, marking an increase of about 179.5% [19]. Strategic Initiatives - The company raised approximately $16.9 million in gross proceeds during 2025 to fund CyPath® Lung clinical development and operational expansion [4]. - The company plans to enroll up to 2,000 patients in a longitudinal trial to evaluate CyPath® Lung as a noninvasive diagnostic for high-risk patients [11]. - The company expanded its intellectual property portfolio with multiple patent allowances and acceptances in 2025, enhancing international protection for its diagnostic technology [4]. Shareholder Information - The weighted average common shares outstanding increased to 1,721,082 in 2025 from 404,167 in 2024, reflecting a significant increase due to the reverse stock split [21].

Company Information - Activate Energy Acquisition Corp. announced the filing of its Annual Report on Form 10-K for the fiscal year ended December 31, 2025[3] - The company is classified as an emerging growth company under the Securities Act of 1933[2] - The company’s principal executive office is located in Grand Cayman, Cayman Islands[2] - The company’s address is 71 Fort Street, PO Box 500, Grand Cayman, Cayman Islands KY1-1106[2] - The trading symbols for the company's securities are AEAQU, AEAQ, and AEAQW on The Nasdaq Stock Market LLC[2] Financial Reporting - The press release regarding the financial results was issued on March 13, 2026[3] - The report includes forward-looking statements that are subject to cautionary statements[4] - The report does not include specific financial performance metrics or user data[3] Product and Market Activity - No new products, technologies, market expansions, or acquisitions were mentioned in the provided documents[3] - Each whole warrant entitles the holder to purchase one Class A ordinary share at a price of $11.50 per share[2]

Revenue and Sales Performance - For the year ended December 31, 2025, revenues from the Cellular and Molecular Technology (CMT) product family accounted for approximately 46% of global revenues, while the Preclinical product family represented about 54%[23][24]. - Direct sales to end-users represented approximately 61% of total revenues for the year ended December 31, 2025, while distributor sales accounted for about 39%[30]. - Sales of third-party products accounted for approximately 13% of revenues for the year ended December 31, 2025[25]. - Revenues decreased by $7.5 million, or 8.1%, to $86.6 million for the year ended December 31, 2025, compared to $94.1 million for the year ended December 31, 2024[128]. - The company reported revenues of $86,550,000 for the year ended December 31, 2025, a decrease of 8.4% compared to $94,135,000 in 2024[204]. Cost Management and Savings - The company anticipates approximately $3 million in cost savings from Project Viking in 2027, with annual savings expected to reach $4 million starting in 2028[15]. - The Company expects to achieve approximately $3 million in cost savings in 2027 and approximately $4 million in annual cost savings beginning in 2028 from Project Viking[123]. - The company is focused on maintaining operational efficiency and cost discipline while pursuing growth through research and development and potential acquisitions[21][32]. Research and Development - Research and development expenses were approximately $8.8 million for the year ended December 31, 2025, down from $10.4 million in 2024[32]. - The company has incurred and will continue to incur substantial expenses for the development of new products and enhancements to existing products, which may affect profitability if development costs are not recovered[52]. Financial Position and Performance - The company incurred a net loss of $56,700,000 in 2025, significantly higher than the net loss of $12,405,000 in 2024, resulting in a loss per share of $1.28 compared to $0.28 in the previous year[204]. - Cash and cash equivalents increased to $8.6 million as of December 31, 2025, compared to $4.1 million as of December 31, 2024[142]. - Total current assets increased to $48,225,000 in 2025 from $45,117,000 in 2024, primarily driven by an increase in cash and cash equivalents[202]. - The company’s total stockholders' equity decreased to $13,734,000 in 2025 from $63,340,000 in 2024, reflecting a significant decline due to the net loss and goodwill impairment[202]. Manufacturing and Operations - The company plans to consolidate its manufacturing operations to improve efficiency and support long-term growth, with a focus on specific centers of excellence[15][33]. - The company expects to close its manufacturing facility in Holliston, MA, transitioning production to its hub in Minneapolis, aligning operations with strategic logistical locations[112]. Compliance and Regulatory Risks - The company faces risks related to government regulations that could reduce demand for its products and adversely impact revenues[55]. - The company is subject to export control regulations that may restrict its ability to transact with certain foreign countries, potentially impacting international sales[61]. - The company received a notification from Nasdaq on April 4, 2025, indicating non-compliance with the minimum bid price requirement of $1.00 per share, based on a closing bid price for 30 consecutive business days[90]. Intellectual Property and Competition - The company has 11 issued patents worldwide as of December 31, 2025, with expiration dates ranging from 2028 to 2044[39]. - The life sciences industry is highly competitive, with many competitors having greater resources, which may impact the company's market position[49]. - The company faces risks related to intellectual property litigation, which could result in reduced revenue if unable to obtain necessary licenses[88][89]. Employee and Labor Market - As of December 31, 2025, the company employed 339 employees, including 316 full-time employees, with the majority located in the United States (192 full-time) and Germany (51 full-time)[45]. - The company operates in competitive labor markets, particularly in Boston, Minneapolis, England, and Germany, which may impact its ability to hire and retain qualified personnel[87]. Currency and Economic Factors - Changes in foreign currency exchange rates had a favorable effect on revenues of $1.2 million and an unfavorable effect on expenses of $1.5 million during the year ended December 31, 2025[151]. - Levels of inflation and interest rates could negatively impact revenues, profitability, and borrowing costs, potentially leading to reduced profit margins and adverse effects on financial results and net income[63]. Internal Controls and Financial Reporting - Material weaknesses in internal controls over financial reporting were identified as of December 31, 2024, but have been remediated by December 31, 2025[70][71]. - The company completed remediation of previously disclosed material weaknesses in internal controls over financial reporting as of December 31, 2025[177]. - The company has not made any changes to its internal control over financial reporting that materially affected its effectiveness during the year ended December 31, 2025[178].

Financial Performance - The company generated a net income of $5.3 million for the year ended December 31, 2022, primarily due to revenues from royalties and milestone payments [185]. - For the years ending December 31, 2025 and 2024, the company incurred net losses of $66.5 million and $61.2 million, respectively, with an accumulated deficit of $304.1 million as of December 31, 2025 [185]. - The company does not expect to achieve profitability or positive cash flows from operations in the foreseeable future [185]. - The company has incurred significant losses since inception and expects to continue incurring losses for at least the next several years [184]. - The company has not yet generated any material revenue from its current product candidates and does not expect significant revenue until successful commercialization [189]. - As of December 31, 2025, the company had cash, cash equivalents, and restricted cash of $71.9 million, which is expected to support operations for at least the next 12 months without additional financing [199]. Business Transactions and Shareholder Structure - Following the completion of the contemplated transactions, current shareholders are expected to own approximately 34% of the outstanding shares of Topco, while former Clywedog stockholders are expected to own approximately 66% [178]. - The anticipated closing of the contemplated transactions is expected in the second quarter of 2026, subject to various conditions being satisfied [170]. Operational Risks and Challenges - The integration of operations with Clywedog may result in unanticipated problems and expenses, potentially harming financial performance [174]. - The company is subject to restrictions on business activities under the Merger Agreement, limiting its ability to take certain actions without prior consent from Clywedog [183]. - The company anticipates substantial increases in expenses as it pursues clinical development and expands operational capabilities [186]. - The company faces significant translational risk as promising preclinical results may not be replicated in clinical trials, impacting revenue generation [190]. - The company may face challenges in accessing new capital due to recent volatility in capital markets, which could limit growth and operational capabilities [209]. - The company faces significant risks related to access to funding sources, which could be impaired by liquidity constraints or disruptions in the financial services industry [211]. Clinical Development and Regulatory Risks - The company is in the preclinical stages of development for certain product candidates, which will require substantial investment and additional clinical development before generating revenue [190]. - The company has not yet demonstrated the ability to successfully complete clinical trials beyond Phase 2b or obtain marketing approvals [194]. - The company expects research and development expenses to increase as it continues preclinical and clinical development activities [204]. - The company may face increased costs and delays if clinical trials do not proceed as planned, impacting overall financial condition [228]. - Delays in clinical trials or regulatory approvals could significantly harm the commercial prospects of product candidates and delay revenue generation [226]. - Regulatory authorities may not accept the company’s assumptions or analyses, potentially impacting the approval and commercialization of product candidates [230]. Market and Competitive Landscape - The company faces substantial competition from various sources, including major pharmaceuticals and biotechnology companies, which may hinder its ability to successfully market or commercialize its product candidates [248]. - The company’s lead product candidate, VTP-1000, is in early development stages and requires extensive clinical testing, with revenue generation expected to be several years away [217]. - The company anticipates that the market opportunities for certain product candidates may be limited to patients who are ineligible for or have failed prior treatments, potentially affecting profitability [240]. Manufacturing and Supply Chain Risks - The company does not currently own manufacturing facilities and relies on third-party manufacturers, which poses risks related to quality and supply [279]. - Reliance on a limited number of third-party manufacturers exposes the company to risks, including geopolitical developments affecting supply chains, particularly with China-based suppliers [282]. - The production process for product candidates requires specific know-how, and competition for manufacturing capacity may hinder the ability to secure sufficient resources [283]. Taxation and Financial Regulations - As of December 31, 2025, the company had cumulative carryforward tax losses of approximately $160.4 million, up from $101.7 million as of December 31, 2024 [311]. - The company expects to benefit from the U.K. research and development tax credit regime starting in 2025, with a Research and Development expenditure credit rate of 20% [312]. - The U.K. tax authority has increased scrutiny on claims for R&D tax credits, which may affect the company's ability to utilize such credits in the future [316]. Data Protection and Compliance Risks - The company faces risks related to data protection and privacy laws, particularly the GDPR, which imposes strict obligations on personal data processing [340]. - Non-compliance with GDPR could lead to substantial fines and restrictions on business activities outside Europe [343]. - The company has implemented measures to comply with GDPR, but ongoing compliance remains resource-intensive and challenging [344]. Intellectual Property Risks - The patent prosecution process is expensive and complex, with uncertainties regarding the issuance and scope of patents that could impact the company's competitive position [362]. - The biotechnology and pharmaceutical patent landscape is highly uncertain, with pending applications not guaranteed to result in enforceable patents [363]. - The company relies heavily on licenses from third parties for essential patent rights and proprietary technology, which imposes various obligations that must be met to maintain these licenses [366].

Financial Performance - The company generated a net income of $5.3 million for the year ended December 31, 2022, primarily due to revenues from AstraZeneca sales of Vaxzevria and the OUI License Agreement[185]. - For the years ending December 31, 2025 and 2024, the company incurred net losses of $66.5 million and $61.2 million, respectively, with an accumulated deficit of $304.1 million as of December 31, 2025[185]. - The company has incurred significant losses since inception and expects to continue incurring losses for at least the next several years[184]. - The company does not expect profits or positive cash flows from operations in the foreseeable future, anticipating substantial increases in expenses related to clinical development and operational expansion[185][186]. - As of December 31, 2025, the company had cash, cash equivalents, and restricted cash of $71.9 million, which is expected to support operations for at least the next 12 months without additional financing[199]. Business Transactions and Shareholder Structure - Following the completion of the contemplated transactions, current shareholders are expected to own approximately 34% of the outstanding shares of Topco, while former Clywedog stockholders are expected to own approximately 66%[178]. - The anticipated closing of the contemplated transactions is expected in the second quarter of 2026, subject to various conditions being satisfied[170]. - The company is subject to restrictions on business activities under the Merger Agreement, limiting its ability to take certain actions without prior consent from Clywedog[183]. - The company may face litigation related to the contemplated transactions, which could materially harm its business and financial condition[180]. Clinical Development and Regulatory Risks - The company has not yet generated any material revenue from its current product candidates and does not expect to do so until successful completion of clinical development and marketing authorization[189]. - The company is in the preclinical stages of development for certain product candidates, which will require substantial investment and additional clinical development before generating revenue[190]. - The company faces significant translational risk as promising preclinical results may not be replicated in clinical trials, impacting revenue generation[190]. - The company has not yet demonstrated the ability to successfully complete clinical trials beyond Phase 2b or obtain marketing approvals[194]. - Clinical trials may produce negative or inconclusive results, potentially leading to additional trials or abandonment of research efforts[221]. - Delays in obtaining regulatory approvals for clinical trials may occur, impacting timelines and costs[219]. - The company may face challenges in maintaining acceptable benefit/risk profiles for product candidates post-authorization, affecting market acceptance[220]. - The unpredictability of clinical trial results may result in failure to obtain marketing authorizations, adversely affecting business operations and financial results[290]. Market and Competitive Landscape - The company faces substantial competition from various sources, including major pharmaceuticals and biotechnology companies, which may adversely affect its financial condition and market position[248]. - Product candidates will compete with existing therapies and new therapies, with key features such as safety, efficacy, and convenience affecting competitiveness[250]. - The company anticipates that the market opportunities for certain product candidates may be limited, particularly for patients who are ineligible for or have failed prior treatments[240]. - There is a high risk of failure in developing marketable products, as preclinical studies and early clinical trials may not predict later-stage trial outcomes[254]. Funding and Capital Requirements - Future capital requirements will depend on various factors, including the costs of research, development, and commercialization of product candidates[208]. - The company may need to raise additional funding, which may not be available on acceptable terms, potentially forcing delays or reductions in product development efforts[198]. - The company expects research and development expenses to increase as it continues preclinical and clinical development activities[204]. - Company faces significant risks related to access to funding sources, which could be impaired by liquidity constraints or disruptions in the financial services industry[211]. - Investor concerns regarding the financial systems may lead to less favorable commercial financing terms, including higher interest rates and tighter covenants[212]. Regulatory Compliance and Legal Risks - The company does not carry insurance for all business risks, leaving it exposed to significant uninsured liabilities[268]. - Regulatory compliance failures by third parties could result in the need for additional clinical trials, delaying marketing authorization[273]. - The company faces ongoing regulatory obligations that may result in significant additional expenses and penalties if compliance is not maintained[317]. - Compliance with healthcare fraud and abuse laws is critical, as violations could result in significant penalties and operational restrictions[335]. - The company faces risks related to data protection and privacy laws, particularly the GDPR, which imposes strict requirements on personal data processing[340]. Taxation and Financial Regulations - Future changes to tax laws could adversely affect the company's financial condition and reduce net returns to shareholders[308]. - Tax authorities may challenge the company's tax positions, potentially leading to increased tax liabilities and impacting financial results[310]. - As of December 31, 2025, the company had cumulative carryforward tax losses of approximately $160.4 million, up from $101.7 million as of December 31, 2024[311]. - The company expects to benefit from the U.K. research and development tax credit regime starting in 2025, with a Research and Development expenditure credit rate of 20%[312]. Intellectual Property and Patent Risks - The patent prosecution process is expensive and complex, with uncertainty regarding the issuance and scope of patents affecting the company's competitive position[362]. - The company relies primarily on in-licensed patents and patent applications, with no issued patents for its product candidates, which could adversely affect commercialization efforts[360]. - There is uncertainty regarding the control over the preparation and enforcement of patents licensed from third parties, which could adversely affect the company's rights to develop and commercialize its products[367]. - Termination of licenses or failure of patents to provide exclusivity could significantly harm the company's ability to commercialize its product candidates, allowing competitors to market identical products[368].