Financial Condition - As of December 31, 2024, the company had cash and cash equivalents of approximately $15,000, a working capital deficit of approximately $3,170,000, and an accumulated deficit of approximately $58,255,000[66]. - The company's auditors expressed substantial doubt regarding its ability to continue as a going concern due to a lack of financial liquidity[67]. - The company has incurred substantial losses from operations to date and may never achieve profitability, which could adversely affect the market value of its common stock[76]. - The company requires additional funding to support its operations, and any new equity financing could have a substantial dilutive effect on existing stockholders[66]. - The company's convertible debt could lead to dilution of existing shareholders if additional shares are issued upon conversion[103]. Internal Controls and Compliance - The company is currently facing material weaknesses in its internal control over financial reporting, which could result in material misstatements in its financial statements[78]. - The company is subject to various federal, state, and foreign consumer protection laws, and failure to comply could have a material adverse effect on its business and financial condition[89]. - The company is subject to increased federal regulations, including the CARD Act and FinCEN's Prepaid Access Rule, which may raise operational costs and impact revenues[90]. - Compliance with Money Transmitter Licenses is mandatory in several states, and failure to maintain these licenses could adversely affect the company's operations and financial condition[91]. - The company collects and stores personally identifiable information, making it subject to various privacy regulations, and any data breaches could lead to significant liabilities and reputational damage[92]. - The company is currently out of compliance with SEC filings but expects to resolve this issue shortly, which is crucial for maintaining investor confidence[102]. Operational Risks - The company is involved in various litigation matters that could harm its business and financial condition if resolved adversely[82]. - The company relies on a small number of key personnel, and the loss of any of these individuals could materially and adversely affect its operations[86]. - The company is subject to evolving anti-money laundering regulations, which may increase operational costs and disrupt business[88]. - Cuentas Mobile relies on third-party network operators for service delivery, making its performance dependent on the reliability of these providers[97]. - The company has an operating history of almost three years in the mobile phone business, and failure to attract and retain subscribers could significantly impact its financial results[99]. Market Competition and Stock Performance - The company faces competition from larger, well-financed competitors, which may hinder its ability to compete effectively in the market[95]. - The company's stock is subject to penny stock rules, which may reduce trading activity and make it difficult for shareholders to sell their shares[106]. - The company does not expect to pay dividends for the foreseeable future, which may deter potential investors seeking current income[110]. - The company's ability to achieve and maintain profitability is dependent on generating revenues and managing development costs effectively[73].

Company Operations - The company operates through four segments: bromine, crude salt, chemical products, and natural gas[158]. - The company is one of the largest bromine producers in China, with significant applications in various industries including agriculture and pharmaceuticals[159]. - In June 2024, the company entered into acquisition agreements for crude salt fields totaling approximately 4,000,000 square meters, with total transfer prices ranging from RMB20,790,000 to RMB129,472,000[173][174][175][176][177]. - The company resumed bromine production in February 2023 after a temporary closure due to government regulations[167]. - The company is awaiting governmental approval for factories No. 2 and No. 10, which may require modifications to current wells and aqueducts[168]. - The company has secured land use rights for its new chemical plant at Bohai Marine Fine Chemical Industrial Park, with construction expected to take approximately one year[169]. - The company plans to proceed with applications for natural gas and brine project approvals following governmental planning finalization in Sichuan Province[170]. Financial Performance - Net revenue for the three-month period ended September 30, 2025, was $9,044,581, representing a 303% increase compared to $2,242,365 for the same period in 2024[194]. - The bromine segment generated net revenue of $8,052,331, a 412% increase from $1,571,313 in the prior year, driven by a 238% increase in tonnes sold[196]. - The crude salt segment reported net revenue of $992,250, up 52% from $654,039, primarily due to a 58% increase in tonnes sold[197]. - The total cost of net revenue for the three-month period was $7,996,785, a 96% increase from $4,071,616 in the same period last year[200]. - Gross profit for the three-month period was $1,047,796, or 12% of net revenue, compared to a gross loss of $1,829,251, or 82%, in the same period in 2024[206]. - Loss from operations decreased to $333,928, a 93% improvement from a loss of $4,581,609 in the prior year[194]. - The company incurred a net loss of $35,664,512 for the three-month period, a 921% increase from a net loss of $3,492,883 in the same period in 2024[194]. - The average selling price of bromine increased to $3,637 per tonne in Q3 2025, compared to $2,396 per tonne in Q3 2024[196]. - The net revenue for the nine-month period ended September 30, 2025, was $18,992,813, a 220% increase from $5,932,596 in the same period in 2024[222]. - The bromine segment's net revenue increased to $17,210,574 for the nine-month period ended September 30, 2025, compared to $4,576,744 in 2024, reflecting a 276% increase[224]. - The company incurred a net loss of $35,664,512 for the three-month period ended September 30, 2025, compared to a net loss of $3,492,883 in the same period in 2024[220]. - Gross profit for the nine-month period ended September 30, 2025, was $2,044,628, representing a margin of 10.8%, compared to a gross loss of $5,370,923, or 91%, for the same period in 2024[233]. - The bromine segment achieved a gross profit margin of 5.8% for the nine-month period ended September 30, 2025, a significant improvement from a gross loss margin of 132% in the same period of 2024, driven by an increase in the average selling price of bromine to $3,751 per ton[235]. - The crude salt segment reported a gross profit margin of 58.9% for the nine-month period ended September 30, 2025, up from 45% in the same period of 2024[236][237]. - The chemical products segment had a gross profit margin of 0% for the nine-month period ended September 30, 2025, due to the closure of the chemical products plant[238]. - Net loss for the nine-month period ended September 30, 2025, was $41,067,789, compared to a net loss of $40,582,933 in the same period in 2024[249]. Expenses and Costs - General and administrative expenses decreased to $785,533 for the three-month period ended September 30, 2025, down from $1,002,529 in 2024, representing a reduction of $216,966[212]. - The cost of net revenue for the nine-month period ended September 30, 2025, was $16,948,185, a 50% increase from $11,303,519 in the same period in 2024, primarily due to increased sales volume[228]. - General and administrative expenses increased by $759,864 (or 32%) to $3,169,821 for the nine-month period ended September 30, 2025, primarily due to higher depreciation costs[241]. - The company incurred direct labor and factory overhead costs of $4,533,760 for the nine-month period ended September 30, 2025, related to plants that have not resumed production[240]. Compliance and Stock Information - The company has received a second 180-calendar day grace period until November 3, 2025, to regain compliance with Nasdaq's bid price requirement after transferring to The Nasdaq Capital Market[188]. - The company plans to effect a reverse stock split if necessary to cure the deficiency during the Second Compliance Period[187]. - The company completed a 1-for-5 reverse stock split in January 2020 and a 1-for-10 reverse stock split in October 2025[171][172]. Cash Flow and Investments - Cash and cash equivalents decreased to $5,820,083 as of September 30, 2025, down from $10,075,162 as of December 31, 2024[250]. - The overall accounts receivable balance increased by $2,858,041 as of September 30, 2025, compared to December 31, 2024, with cash collections significantly impacting liquidity[254]. - The company used $8,673,384 in investing activities during the nine-month period ended September 30, 2025, primarily for updates and renovations[259]. Accounting Policies - The company prepares its consolidated financial statements in accordance with generally accepted accounting principles in the United States, requiring management to make estimates and assumptions that affect reported amounts of assets and liabilities[265]. - Key critical accounting policies include accounts receivable, inventory allowances, and revenue recognition, as detailed in the Company's Form 10-Q for the nine months ended September 30, 2025[266]. - The company is classified as a "smaller reporting company" and is not required to provide certain market risk disclosures[267].

Revenue Performance - Revenue for Q3 2025 was $6.8 million, a 78% increase sequentially and a 76% increase year-over-year compared to Q3 2024's $3.9 million[5] - Total revenue for the three months ended September 30, 2025, was $6,783 million, a significant increase from $3,860 million in the same period of 2024, representing a growth of 76.5%[21] - Product revenue reached $2,195 million for the three months ended September 30, 2025, compared to $1,958 million in 2024, marking an increase of 12.1%[21] - Service revenue surged to $4,588 million for the three months ended September 30, 2025, up from $1,902 million in 2024, reflecting a growth of 141.5%[21] Profitability and Loss - Gross profit for Q3 2025 was $3.9 million, reflecting an increase from $2.3 million in Q3 2024, while gross margin declined to 58% from 60% year-over-year[5] - Gross profit for the three months ended September 30, 2025, was $3,937 million, compared to $2,334 million in 2024, indicating an increase of 68.8%[21] - The operating loss for Q3 2025 increased to $4.7 million from $2.6 million in Q3 2024[5] - Operating loss for the three months ended September 30, 2025, was $(4,734) million, widening from $(2,645) million in the same period of 2024[21] - Net loss for the three months ended September 30, 2025, was $(5,400) million, compared to $(2,616) million in 2024, representing an increase in loss of 106.8%[21] - Net loss per share (basic and diluted) for the three months ended September 30, 2025, was $(0.49), compared to $(0.40) in 2024[21] Expenses and Financial Position - Operating expenses for Q3 2025 were $8.7 million, a 74% increase from $5.0 million in Q3 2024, primarily due to increased headcount and depreciation expenses related to the SCN acquisition[5] - Total operating expenses for the three months ended September 30, 2025, were $8,671 million, up from $4,979 million in 2024, reflecting a rise of 74.5%[21] - Cash and cash equivalents decreased to $3.1 million as of September 30, 2025, down from $6.3 million at the end of 2024[5] - Stockholders' equity was $2.5 million as of September 30, 2025, compared to $8.0 million at the end of 2024[5] Strategic Initiatives - The acquisition of The Sleep Center of Nevada contributed $2.2 million in diagnostic sleep testing revenue and $1.3 million in treatment center revenue during Q3 2025[5] - Vivos plans to expand its model into additional major markets beyond Las Vegas through acquisitions or contractual alliances with sleep medical practices[3] - The company is actively working to add new sleep optimization teams in 2026 to reduce cash burn and create potential for profitable operations[4] - Vivos has entered into a management agreement with MISleep Solutions LLC to provide its treatments and services in Auburn Hills, Michigan, with patient services expected to begin in early December 2025[7] Shareholder Information - The weighted average number of shares outstanding (basic and diluted) increased to 10,963,590 for the three months ended September 30, 2025, from 6,615,320 in 2024[21] - Non-operating income (expense) included other expense of $(679) million for the three months ended September 30, 2025, compared to $(18) million in 2024[21]

Financial Performance - Net sales for the three months ended September 30, 2025, were $1,273,000, a decrease from $4,914,000 in the same period of 2024, representing a decline of approximately 74%[15] - Gross profit for the three months ended September 30, 2025, was a loss of $2,260,000 compared to a profit of $1,424,000 in the same period of 2024[15] - The net loss for the three months ended September 30, 2025, was $4,085,000, compared to a net income of $13,000 in the same period of 2024[15] - For the nine months ended September 30, 2025, the company recorded a net loss of $5,621,000 compared to a net loss of $1,628,000 for the same period in 2024[25] - Revenue for the nine months ended September 30, 2025, was $5,704 million, a decrease from $11,348 million in 2024, representing a decline of approximately 50.3%[89] - The net loss for the nine months ended September 30, 2025, was $5,621 million, compared to a net loss of $1,628 million in 2024, indicating a significant increase in losses[89] Assets and Liabilities - Total current assets decreased to $11,822,000 as of September 30, 2025, down from $15,597,000 as of December 31, 2024, reflecting a decline of about 24%[13] - Total liabilities increased to $9,447,000 as of September 30, 2025, compared to $9,034,000 as of December 31, 2024, indicating a rise of approximately 5%[13] - Cash and cash equivalents were reported at $4,000 as of September 30, 2025, a significant decrease from $498,000 as of December 31, 2024[13] - The accumulated deficit as of September 30, 2025, was $35,957,000, up from $30,336,000 as of December 31, 2024[13] Operating Expenses - Operating expenses for the three months ended September 30, 2025, totaled $1,617,000, an increase from $1,384,000 in the same period of 2024[15] - Interest paid for the nine months ended September 30, 2025, was $606,000, compared to $598,000 for the same period in 2024[25] - Total interest expense, fees, and financing costs for the nine months ended September 30, 2025, were $497, down from $588 for the same period in 2024[75] Inventory and Impairments - The company reported an inventory write-down of $1,967,000 and an impairment of right-of-use assets and lease deposits totaling $455,000[25] - The Company recorded total impairment charges of $455 for the three and nine months ended September 30, 2025, including $347 related to right-of-use assets[79] - As of September 30, 2025, total inventories were $10,892 million, down from $12,893 million as of December 31, 2024[46] Customer and Sales Information - The largest customer accounted for 68% of total revenues for the nine months ended September 30, 2025, compared to 44% for the two largest customers in the same period of 2024[59] - For the three months ended September 30, 2025, sales to telecommunications customers accounted for 92% of total revenues[58] - International sales for the three months ended September 30, 2025, totaled $6 million, a significant drop from $470 million in 2024[42] - DC power systems sales for the three months ended September 30, 2025, were $898 million, a decline of 79% from $4,340 million in 2024[40] Future Outlook and Plans - The company anticipates an increase in tariffs on imported products, which may impact profitability and global sales[33] - The company is currently negotiating a payment plan for delinquent rent with its landlords, with a proposed settlement to pay the overdue rent by February 28, 2026[28] - The Company expects to receive $325 in purchase orders by December 15, 2025, which is critical for meeting its financial obligations[69] - The company has a backlog of $5,283 million, with 53% from telecommunications customers, 13% from military customers, 1% from marine customers, and 33% from EV mobile charger customers[93] - The company expects the majority of its backlog orders to ship within the next twelve months[93] Shareholder and Financing Activities - The company entered into an ATM sales agreement on October 6, 2025, allowing for the sale of shares up to an aggregate offering price of $2,382 million[90] - As of November 19, 2025, the company sold 147,144 shares at an average price of approximately $5.00, resulting in net proceeds of approximately $714 million after commissions[91] - The company received a purchase order for $1,700 million for fifty Mobile EV Chargers, scheduled for delivery in 2026 over a 12-month period[92] - In October 2025, the company received a $674 million contract from a military customer for compact, lightweight DC generators[91] Delinquencies and Financial Obligations - The Company is currently delinquent in $398 of past due rents as of September 30, 2025[80] - The Company has a delinquent balance of $29 related to unsecured property taxes as of September 30, 2025[69]

Revenue Performance - Revenue for the third quarter of fiscal year 2026 was $57.0 billion, representing a 62% increase year-over-year and a 22% increase sequentially [126]. - Data Center revenue reached $51.2 billion, up 66% year-over-year and 25% sequentially, driven by accelerated computing and AI solutions [127]. - Data Center compute revenue was $43.0 billion, reflecting a 56% increase year-over-year and a 27% increase sequentially [128]. - Networking revenue surged to $8.2 billion, a 162% increase year-over-year, attributed to the growth of NVLink compute fabric [128]. - Gaming revenue increased by 30% year-over-year but decreased by 1% sequentially, as channel inventories normalized [129]. - Professional Visualization revenue rose 56% year-over-year and 26% sequentially, driven by the launch of the new DGX Spark [130]. - Compute & Networking revenue increased by 62% year-over-year to $35,721 million for the third quarter of fiscal year 2026, driven by demand for the Blackwell computing platform [138]. - Data Center computing revenue grew 59% year-on-year compared to the first nine months of fiscal year 2025, while Data Center networking revenue surged 105% year-on-year in the same period [138]. Operating Expenses and Margins - Operating expenses increased by 36% year-over-year and 8% sequentially, primarily due to higher compute and infrastructure costs [132]. - The gross margin for the third quarter was 73.4%, a decrease of 1.2 percentage points year-over-year but an increase of 1.0 percentage point sequentially [126]. - Gross margin decreased to 73.4% for the third quarter of fiscal year 2026, down from 74.6% in the same quarter of fiscal year 2025, impacted by a $4.5 billion charge related to excess inventory [148]. - Total operating expenses rose by 36% year-over-year to $5,839 million for the third quarter of fiscal year 2026, primarily due to a 39% increase in research and development expenses [151]. Financial Position and Cash Flow - Cash and cash equivalents increased to $11,486 million as of October 26, 2025, up from $8,589 million at the beginning of the year [162]. - Net cash provided by operating activities for the first nine months of fiscal year 2026 was $66,530 million, an increase from $47,460 million in the same period of fiscal year 2025 [163]. - As of October 26, 2025, the company had $60.6 billion in cash, cash equivalents, and marketable securities, ensuring sufficient liquidity for at least the next twelve months [166]. - The company repurchased 70 million shares for $12.6 billion in Q3 and 262 million shares for $36.7 billion in the first nine months of fiscal year 2026 [169]. - Cash dividends paid to shareholders amounted to $243 million in Q3 and $732 million in the first nine months of fiscal year 2026 [171]. Tax and Regulatory Matters - Income tax expense for the third quarter of fiscal year 2026 was $6.0 billion, with an effective tax rate of 15.9%, compared to $3.0 billion and 13.5% for the same quarter of fiscal year 2025 [156]. - Unrecognized tax benefits totaled $3.2 billion as of October 26, 2025, including related interest and penalties [175]. Strategic Investments and Commitments - The company committed to invest $5 billion in Intel Corporation and up to $10 billion in Anthropic, subject to regulatory approval and closing conditions [176]. - An additional $60.0 billion in share repurchase authorization was approved by the Board of Directors on August 26, 2025, bringing the total authorized repurchase amount to $62.2 billion [169]. Inventory and Supply Chain - The company incurred a $4.5 billion charge in Q1 FY 2026 due to diminished demand for the H20 product following new export regulations [119]. - Provisions for inventory and excess inventory purchase obligations totaled $410 million for the third quarter of fiscal year 2026, including $4.5 billion associated with excess inventory [149]. - The company is increasing U.S.-based manufacturing to strengthen its supply chain and meet growing demand for AI infrastructure [123]. Customer Concentration and Geographic Revenue - The company generated significant revenue from a limited number of direct customers, with four customers representing 61% of total revenue in the third quarter of fiscal year 2026 [142]. - Revenue from customers headquartered outside the United States accounted for 31% of total revenue for the third quarter of fiscal year 2026, down from 44% in the same quarter of fiscal year 2025 [146]. Debt and Financial Instruments - Aggregate debt maturities as of October 26, 2025, total $8.467 billion, with $1 billion due in one year and $2.75 billion due in one to five years [173]. - The company has a $575 million commercial paper program, with no commercial paper outstanding as of October 26, 2025 [173]. - A hypothetical 10% decrease in publicly-held equity securities would decrease their fair value by $387 million as of October 26, 2025 [181]. Sustainability and Regulatory Impact - There has been no material impact from global sustainability regulations or climate-related business trends on the company's operations [178].

Financial Performance - Net sales for the three months ended September 30, 2025, were $759,999, a decrease of $6,443,270 (89.4%) compared to $7,203,269 in the prior year due to the sale of the smoke and carbon monoxide alarm business[69]. - For the six months ended September 30, 2025, net sales were $4,584,246, a decrease of $7,217,539 (61.2%) compared to $11,801,785 in the prior year[76]. Profitability - Gross profit margin increased to 60.4% for the quarter ended September 30, 2025, compared to 27.7% for the same quarter in 2024, primarily due to a refund of previously recorded tariffs[70]. - The gross profit margin for the six months ended September 30, 2025, was 25.2%, down from 26.1% in the same period of 2024[77]. - The company reported a net loss of $999,780 for the quarter ended September 30, 2025, compared to net income of $576,978 in the same quarter of the previous year, a decrease of $1,576,758 (273.3%) in net income[75]. - The company reported net income of $810,541 for the six months ended September 30, 2025, an increase of $675,769 (501.4%) compared to $134,772 in the same period of the previous year, driven by the gain on the sale of the smoke and carbon monoxide business[81]. Expenses - Selling, general and administrative expenses rose to $1,311,187 for the three months ended September 30, 2025, representing 172.5% of net sales, up from 16.8% in the prior year[72]. - Selling, general and administrative expenses for the six months ended September 30, 2025, were $2,424,490, accounting for 52.9% of sales, up from 22.1% in the prior year[78]. Cash Flow - Operating activities provided cash of $3,940,773 for the six months ended September 30, 2025, primarily due to a decrease in accounts receivable and inventories[82]. Strategic Actions - The company closed the asset sale to Feit Electric Company on May 22, 2025, allowing it to focus on importing and marketing other product lines[67].

Merger and Acquisition Activities - For the fiscal year ended September 30, 2025, the company reported a merger agreement with Lone Star Fund XII, L.P., where each share of common stock will be converted into $32.00 in cash[221]. - The company incurred transaction expenses of $3.3 million related to the merger for the year ended September 30, 2025, recorded in selling, general and administrative expenses[222]. - The company completed the divestiture of its majority interest in Milacron for total consideration of $286.0 million, resulting in a pre-tax loss of $57.2 million[252][254]. - The company recorded a pre-tax gain of $68.1 million from the divestiture of its 46% interest in TerraSource to Astec Industries[255]. - Business acquisition costs were $1.3 million in 2025 and $0.2 million in 2024, divestiture costs were $8.9 million in 2025 and $0.4 million in 2024, and integration costs were $54.9 million in 2025 compared to $71.6 million in 2024[299]. Financial Performance - Net revenue for the year ended September 30, 2025, decreased by $509.0 million (16%) compared to the previous year[257]. - Gross profit for the same period decreased by $155.7 million (15%), but the gross profit margin improved by 50 basis points to 33.7%[258]. - Consolidated net income for fiscal 2025 increased by $254.1 million (126%) to $52.1 million, attributed to a decrease in non-cash impairment charges and favorable pricing[291]. - Consolidated adjusted EBITDA for fiscal 2025 decreased by $123.7 million (24%) to $388.0 million, primarily due to lower volume in the Advanced Process Solutions segment[292]. - Net revenue for Advanced Process Solutions decreased by $218.6 million (10%) to $2,069.4 million in fiscal 2025, primarily due to lower capital equipment sales volume and aftermarket parts revenue[268]. - Net revenue for Molding Technology Solutions decreased by $290.4 million (32%) to $604.4 million, primarily due to the divestiture of Milacron[276]. - Net revenue for the year ended September 30, 2025, was $369.8 million, a decrease of 53% compared to $784.3 million for the year ended September 30, 2024[320]. - Gross profit for the year ended September 30, 2025, was $126.7 million, down 41.2% from $215.2 million in the previous year[320]. Operational Metrics - Backlog is a significant operational measure, representing expected net revenue from awarded contracts, with fulfillment timelines ranging from days to 24 months depending on the project size[218][219]. - The company expects future net revenue to be influenced by order backlog, which does not include projects shipped within the same quarter[216]. - The company’s contracts may include provisions for cancellation or termination at the discretion of the customer, impacting backlog and revenue recognition[219]. - Order backlog for Advanced Process Solutions decreased by $159.0 million (9%) from $1,681.4 million at September 30, 2024, to $1,522.4 million at September 30, 2025, driven by a decrease in capital equipment orders[269]. - Order backlog for Molding Technology Solutions decreased by $179.3 million (78%) to $51.8 million, primarily due to the Milacron divestiture[277]. Impairment and Goodwill - The company’s goodwill and indefinite-lived intangible assets are tested for impairment at least annually, with significant judgments involved in the assessment[231][239]. - The company recorded a goodwill impairment charge of $82.3 million for the Molding Technology Solutions segment as of July 1, 2025, due to carrying values exceeding fair values[244]. - The estimated fair value for the three reporting units within the Advanced Process Solutions segment was determined to be 12% to 96% greater than their carrying values[243]. - Impairment charges for the year were $83.5 million, down from $265.0 million in the previous year[262]. Expenses and Cash Flow - Selling, general and administrative expenses decreased by $63.6 million (9%), but as a percentage of net revenue, they increased by 210 basis points to 24.3%[261]. - Selling, general and administrative expenses for Advanced Process Solutions decreased by $17.7 million (4%) to $433.4 million, with expenses as a percentage of net revenue increasing to 20.9%[272]. - Corporate expenses increased by $1.9 million (2%) to $89.3 million, with corporate expenses as a percentage of net revenue rising to 3.3%, an increase of 60 basis points[287]. - Operating cash flows from continuing operations decreased by $135.1 million (71%) from $191.3 million in 2024 to $56.2 million in 2025, primarily due to lower earnings and unfavorable working capital timing[310]. - Cash used in financing activities was $279.4 million in 2025, mainly for debt repayments and dividends, compared to $227.1 million in 2024[313]. Tax and Pension - The effective tax rate for fiscal 2025 was 2,270.8%, a significant increase from (46.5)% in fiscal 2024, primarily due to non-recurring tax benefits and restructuring activities[266]. - The pension settlement gain in 2025 was attributed to one-time premium refunds from the termination of the U.S. pension plan, while charges in 2024 were due to lump-sum payments to former employees[299]. - The anticipated contribution to defined benefit pension plans in 2026 is $10.1 million, with ongoing monitoring of funding levels and asset performance[302]. Debt and Liquidity - The company has a $700 million revolving credit facility and a $175 million term loan, with the maturity date extended to July 9, 2030[306]. - Total contractual obligations as of September 30, 2025, amounted to $633.3 million, with significant future cash outlays expected[317]. - The company reported a net cash flow of $(36.5) million in 2025, compared to $(22.3) million in 2024, reflecting challenges in cash generation[309]. - The company repurchased 4,143,000 shares for approximately $175.0 million under the share repurchase program, with $125.0 million remaining for future repurchases as of September 30, 2025[301]. Market and Currency Risks - The company calculates foreign currency impact on net revenue and other financial metrics to measure comparability between periods[217]. - A hypothetical 10% movement in end-of-period market rates would change the fair value of derivative instruments by $8.1 million as of September 30, 2025[328]. - The translation of financial statements from non-U.S. operations could result in a change in shareholders' equity of $131.5 million due to a 10% change in foreign exchange rates as of September 30, 2025[329]. - Variable rate debt obligations amounted to $681.3 million as of September 30, 2025, with a potential annual interest expense change of approximately $6.8 million for a 1% interest rate change[327]. - Current global supply chain disruptions may impact gross margins if commodity prices increase and firm pricing cannot be secured from suppliers[326].

Financial Position - As of September 30, 2025, the company had cash of $691,042 and positive working capital of $594,021[101] - As of September 30, 2025, cash held in the Trust Account amounted to $176,663,659, intended for the initial business combination[110] - The company does not have any long-term debt or capital lease obligations as of September 30, 2025[115] Income and Revenue - For the nine months ended September 30, 2025, the company reported net income of $1,312,252, primarily from interest income of $1,668,159[103] Initial Public Offering (IPO) - The initial public offering generated gross proceeds of $174,995,500 from the sale of 17,499,550 units at an offering price of $10.00 per unit[105] - Following the IPO, a total of $174,995,500 was placed in the Trust Account, with transaction costs amounting to $3,195,665[107] - The underwriters exercised their over-allotment option fully, purchasing an additional 2,282,550 units[115] Cash Flow - Cash used in operating activities for the nine months ended September 30, 2025, was $256,543[108] - Cash provided by financing activities for the same period was $175,943,085, reflecting proceeds from the IPO and private placements[109] - The company may seek additional financing to complete the business combination if cash on hand is insufficient[113]

Financial Position - As of September 30, 2025, the company had cash of $691,042 and positive working capital of $594,021[101] - As of September 30, 2025, cash held in the Trust Account was $176,663,659, intended for the initial business combination[110] - The company does not have any long-term debt or capital lease obligations as of September 30, 2025[115] - The company has no off-balance sheet arrangements or long-term liabilities as of September 30, 2025[114] Income and Revenue - For the nine months ended September 30, 2025, the company reported net income of $1,312,252, primarily from interest income of $1,668,159[103] Initial Public Offering - The company completed its Initial Public Offering on July 10, 2025, raising gross proceeds of $174,995,500 from the sale of 17,499,550 units[105] - Following the Initial Public Offering, a total of $174,995,500 was placed in the Trust Account, with transaction costs amounting to $3,195,665[107] - The underwriters received a cash underwriting discount of $0.05 per unit, totaling $750,000, paid upon the closing of the Initial Public Offering[116] Cash Flow - Cash used in operating activities for the nine months ended September 30, 2025, was $256,543[108] - Cash provided by financing activities for the same period was $175,943,085, net of offering costs[109]

Financial Position - As of September 30, 2025, the company has an accumulated deficit of $878.6 million and used approximately $19.1 million of cash in operations for the nine months ended September 30, 2025[244]. - The company has unrestricted cash totaling $1.8 million as of September 30, 2025, with $1.1 million due to assignors and $0.8 million owed to a law firm for legal fees[239]. - The present value of amounts owed under claims financing obligations and notes payable agreements was $764.6 million as of September 30, 2025, with a weighted average interest rate of 15.6%[392]. - The minimum required payments on these agreements totaled $897.1 million as of September 30, 2025, with maturities ranging until 2031[393]. - Cash at the end of the period was $1.8 million, down from $4.7 million at the end of the same period in 2024[388]. - The Company has $9.5 million of advances from Yorkville as of September 30, 2025[392]. - The Company experienced a net loss of $723.3 million during the nine months ended September 30, 2025, which significantly impacted cash flows[389]. Revenue and Income - The Company has not yet generated substantial revenue from the recovery model, with no Claims recovery service income recognized during the nine months ended September 30, 2025 or 2024[258]. - Total revenue for the three months ended September 30, 2025, was $198 thousand, a 95% decrease compared to $3.7 million in the same period of 2024[328]. - Claims recovery income decreased by $8.3 million to $1.6 million for the nine months ended September 30, 2025, representing an 84% decline compared to the prior year[339]. - Total revenue fell by $8.4 million to $1.6 million, also an 84% decrease year-over-year[339]. - Claims recovery income decreased by $3.4 million to $0.2 million for the three months ended September 30, 2025, driven by decreased settlements during the period[328]. Operational Challenges - The company has incurred substantial net losses since inception and has limited liquidity, raising concerns about its ability to continue as a going concern without additional funding[239]. - The Company has assessed its ability to continue as a going concern, indicating potential liquidity challenges[270]. - The Yorkville SEPA is the Company's sole source of liquidity for short-term obligations, and failure to secure funding may lead to insolvency proceedings[371]. - The Company is expected to repay obligations from cash flows generated from claim recovery income[392]. Funding and Financing - The company has entered into agreements with Yorkville for funding, including a supplemental agreement for up to $3.0 million in convertible promissory notes, with a total working capital funding of $2.1 million received by August 2025[241]. - A term sheet was entered into for a potential first lien secured delayed draw term loan facility of up to $55.0 million, maturing 36 months after closing[272]. - The Company entered into a standby equity purchase agreement with Yorkville to purchase up to $250 million in shares of Class A Common Stock[353]. - The Company sold 2,353,238 shares of Class A Common Stock to Yorkville at prices between $1.60 and $17.55 per share, using proceeds to reduce amounts owed by $6.2 million and fund operations by $0.7 million[367]. - Yorkville has agreed to increase pre-paid advances by up to $3.0 million, with multiple tranches funded in 2025, indicating ongoing financial support[281]. Market and Claims Recovery - The total potentially serviceable market for the company is estimated to be over $161.5 billion annually, with Medicare expenditures in 2023 at approximately $1,029.8 billion and Medicaid at approximately $871.7 billion[252]. - Approximately 95.9% of expected recoveries arise from claims under the Medicare Secondary Payer Act, indicating a significant dependency on this legislation for future revenue[254]. - The Recovery Multiple is a key metric, with the potential for future recoveries to exceed the Paid Amount, which is expected to become more meaningful in the next 12 months[304][305]. - Approximately 86.5% of identified potentially recoverable claims are already in the recovery process as of September 30, 2025[297]. - The Paid Value of Potentially Recoverable Claims is a measure of the Paid Amount paid to providers, which is essential for future claims recovery income[300]. Expenses and Losses - Operating loss for the three months ended September 30, 2025, was $123.8 million, a slight improvement of $6.1 million compared to a loss of $129.9 million in the prior year[328]. - Interest expense increased by $23.8 million to $130.5 million in the three months ended September 30, 2025, primarily due to increased obligations related to financing[334]. - General and administrative expenses decreased by $1.4 million to $4.0 million for the three months ended September 30, 2025, primarily driven by payroll and marketing expense reductions[331]. - Professional fees decreased by $2.3 million to $1.0 million for the three months ended September 30, 2025, mainly due to lower corporate legal and consulting fees[332]. - Claims amortization expense decreased by $2.4 million to $118.6 million for the three months ended September 30, 2025, due to a lower amortizable asset base[330]. Strategic Developments - The company utilizes proprietary data analytics platforms to identify recoverable healthcare claims, differentiating itself from competitors by receiving irrevocable assignments of claims[250]. - The clearinghouse platform, developed in collaboration with Palantir, integrates AI, NLP, and ML to improve healthcare reimbursement processes and address systemic issues with primary payer reporting[264][266]. - The Chase to Pay platform aims to improve payment accuracy and is expected to enhance the net recovery margin as recovery multiples grow and legal costs decline[261][262]. - The Company has grown its Assignor base from 32 in 2015 to over 160 to date, indicating a strategy to expand its claims portfolio[294]. - The EHR Platform went live in Q2 2024, but revenue generated from it has not been significant, indicating challenges in monetization[269].