Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Securities registered pursuant to Section 12(b) of the Act: | | Trading | | | --- | --- | --- | | Title of each class | Symbol(s) | Name of each exchange on which registered ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ___________ Commission File Number: 001-41013 GCT Semiconductor Holding, Inc. (Exact Name of Registrant as Specified in its Char ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the quarterly period ended June 30, 2025 o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from______to______ (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 2000 Regency Parkway Drive, Suite 300, Ca ...

[Cover Page and Filing Information](index=1&type=section&id=Cover%20Page%20and%20Filing%20Information) [Registrant Information](index=1&type=section&id=Registrant%20Information) GoHealth, Inc. is a Delaware corporation, trading as GOCO on Nasdaq Global Market, classified as a non-accelerated filer and smaller reporting company - GoHealth, Inc. is listed on the Nasdaq Global Market under the ticker symbol **GOCO**[4](index=4&type=chunk) - Company Filing Status | Status | Mark | | :--- | :--- | | Large Accelerated Filer | ☐ | | Accelerated Filer | ☐ | | Non-Accelerated Filer | ☒ | | Smaller Reporting Company | ☒ | | Emerging Growth Company | ☐ | - As of August 7, 2025, the company had **15,988,354 shares of Class A common stock** and **12,620,884 shares of Class B common stock** issued[5](index=5&type=chunk) [Preliminary Information](index=5&type=section&id=Preliminary%20Information) [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=5&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This report contains forward-looking statements concerning liquidity, future operations, business strategy, AI technology, regulatory impacts, and the e-TeleQuote acquisition integration - Forward-looking statements cover liquidity, future operating results, business strategy, AI technology application, regulatory changes, and e-TeleQuote acquisition integration[9](index=9&type=chunk) - Actual results may differ materially from forward-looking statements due to factors described in "Risk Factors" and "Management's Discussion and Analysis"[10](index=10&type=chunk)[11](index=11&type=chunk) [CERTAIN DEFINITIONS AND KEY TERMS](index=5&type=section&id=CERTAIN%20DEFINITIONS%20AND%20KEY%20TERMS) This section defines key terms used in the report, including company entities, equity structure parties, and transactions - "We", "the Company", "GoHealth" refer to GoHealth, Inc. and its direct and indirect subsidiaries, including GoHealth Holdings, LLC[14](index=14&type=chunk) - "Continuing Equity Owners" are direct or indirect holders of GHH, LLC's LLC interests and the Company's Class B common stock, convertible into Class A common stock or cash under certain conditions[14](index=14&type=chunk) - "Transactions" refer to the Company's initial public offering (IPO) and related organizational transactions[19](index=19&type=chunk) [NON-GAAP FINANCIAL MEASURES](index=6&type=section&id=NON-GAAP%20FINANCIAL%20MEASURES) The company uses non-GAAP financial measures like EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin to supplement GAAP statements and assess operating performance - Non-GAAP financial measures include EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin, supplementing GAAP financial information[17](index=17&type=chunk)[181](index=181&type=chunk) - Adjusted EBITDA is management's primary non-GAAP financial performance metric for evaluating the business, monitoring operating results, and is a basis for certain compensation plans[17](index=17&type=chunk)[182](index=182&type=chunk) - Non-GAAP metrics may not be comparable to other companies and should not be considered in isolation or as a substitute for GAAP measures[17](index=17&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk) - Non-GAAP Financial Measures Definitions | Metric | Definition | | :--- | :--- | | **EBITDA** | Net income (loss) plus interest expense, income tax expense (benefit), and depreciation and amortization expense | | **Adjusted EBITDA** | EBITDA adjusted for specific items such as share-based compensation, professional service fees, legal fees, asset impairment, and severance expenses | | **Adjusted EBITDA Margin** | Adjusted EBITDA divided by net revenue | [KEY BUSINESS PERFORMANCE AND OPERATING METRICS](index=7&type=section&id=KEY%20BUSINESS%20PERFORMANCE%20AND%20OPERATING%20METRICS) Key business and operating metrics such as Submissions, Sales per Submission, and Direct Operating Cost per Submission are used to evaluate performance and drive operations - Key operating metrics include Sales per Submission and Direct Operating Cost per Submission, used to understand the company's underlying financial performance and trends[23](index=23&type=chunk) - "Submission" refers to a completed and approved Medicare application, an application referred through the Encompass model, or a completed and approved GoHealth Protect application[24](index=24&type=chunk)[193](index=193&type=chunk) - "Sales per Submission" measures the average revenue generated per submission during the reporting period, including Medicare agency and non-agency revenue and GoHealth Protect revenue[24](index=24&type=chunk)[195](index=195&type=chunk) - "Direct Operating Cost per Submission" measures the average cost directly incurred per submission during the reporting period, including revenue share, marketing and advertising, and consumer care and enrollment expenses[24](index=24&type=chunk)[199](index=199&type=chunk) [PART I - FINANCIAL INFORMATION](index=8&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS.](index=8&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS.) This section presents GoHealth, Inc.'s unaudited condensed consolidated financial statements as of June 30, 2025, and December 31, 2024, with detailed notes [CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the three months ended June 30, 2025, net revenue was $94,048 thousand, a 11.2% decrease year-over-year, with operating loss expanding to $99,386 thousand and net loss at $115,989 thousand - Condensed Consolidated Statements of Operations Summary (Unaudited, in thousands of dollars, except per share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Revenue | 94,048 | 105,870 | 315,020 | 291,470 | | Total Operating Expenses | 193,434 | 146,480 | 407,737 | 336,112 | | Operating Income (Loss) | (99,386) | (40,610) | (92,717) | (44,642) | | Interest Expense | 16,945 | 18,096 | 32,899 | 36,047 | | Income Tax (Benefit) Expense | (353) | (40) | 749 | (111) | | Net Income (Loss) | (115,989) | (59,314) | (125,775) | (80,660) | | Net Income (Loss) Attributable to GoHealth, Inc. | (54,277) | (25,996) | (58,685) | (35,212) | | Net Income (Loss) Per Share of Class A Common Stock—Basic and Diluted | (5.10) | (2.70) | (5.72) | (3.76) | - Net revenue for Q2 2025 decreased by **11.2% year-over-year**, primarily due to the company's conscious scaling back of Medicare Advantage business activities[26](index=26&type=chunk)[169](index=169&type=chunk) - Operating loss and net loss for Q2 2025 significantly expanded year-over-year, partly due to a **$53.0 million intangible asset impairment charge**[26](index=26&type=chunk)[179](index=179&type=chunk) [CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)](index=9&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME%20(LOSS)) For the three months ended June 30, 2025, comprehensive loss expanded to $115,769 thousand from $59,361 thousand in the prior year, with comprehensive loss attributable to GoHealth, Inc. at $54,174 thousand - Condensed Consolidated Statements of Comprehensive Income (Loss) Summary (Unaudited, in thousands of dollars) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income (Loss) | (115,989) | (59,314) | (125,775) | (80,660) | | Other Comprehensive Income (Loss): | | | | | | Foreign Currency Translation Adjustment | 220 | (47) | 101 | (52) | | Comprehensive Income (Loss) | (115,769) | (59,361) | (125,674) | (80,712) | | Comprehensive Income (Loss) Attributable to Non-Controlling Interests | (61,595) | (33,344) | (67,038) | (45,477) | | Comprehensive Income (Loss) Attributable to GoHealth, Inc. | (54,174) | (26,017) | (58,636) | (35,235) | [CONDENSED CONSOLIDATED BALANCE SHEETS](index=10&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of June 30, 2025, total assets were $1,311,060 thousand, down from $1,488,423 thousand at December 31, 2024, reflecting increased liabilities and reduced stockholders' equity - Condensed Consolidated Balance Sheets Summary (Unaudited, in thousands of dollars, except per share amounts) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and Cash Equivalents | 35,590 | 40,921 | | Commissions Receivable - Current | 226,152 | 320,399 | | Total Current Assets | 288,802 | 400,411 | | Commissions Receivable - Non-Current | 770,452 | 733,161 | | Intangible Assets, Net | 202,469 | 302,497 | | **Total Assets** | **1,311,060** | **1,488,423** | | **Liabilities** | | | | Total Current Liabilities | 185,003 | 338,052 | | Long-Term Debt, Net of Current Portion | 560,003 | 447,865 | | **Total Liabilities** | **792,075** | **691,971** | | **Stockholders' Equity** | | | | Total Stockholders' Equity Attributable to GoHealth, Inc. | 191,775 | 241,839 | | Non-Controlling Interests | 87,317 | 163,599 | | **Total Stockholders' Equity** | **279,092** | **405,438** | - Net intangible assets were **$202,469 thousand** as of June 30, 2025, a significant decrease from **$302,497 thousand** at December 31, 2024, primarily due to a **$53.0 million intangible asset impairment charge**[33](index=33&type=chunk)[65](index=65&type=chunk) - Long-term debt, net of current portion, increased from **$447,865 thousand** at December 31, 2024, to **$560,003 thousand** at June 30, 2025, reflecting increased borrowings[33](index=33&type=chunk)[69](index=69&type=chunk) [CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY](index=11&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CHANGES%20IN%20STOCKHOLDERS'%20EQUITY) For the six months ended June 30, 2025, total stockholders' equity attributable to GoHealth, Inc. decreased from $405,438 thousand to $279,092 thousand, primarily due to net loss and reduced non-controlling interests - Condensed Consolidated Statements of Changes in Stockholders' Equity Summary (Unaudited, in thousands of dollars) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Beginning Balance (January 1) | 405,438 | 405,653 | | Net Income (Loss) | (125,775) | (80,660) | | Net Income (Loss) Attributable to GoHealth, Inc. | (58,685) | (35,212) | | Net Income (Loss) Attributable to Non-Controlling Interests | (67,090) | (45,448) | | Share-Based Compensation Expense | 5,952 | 5,546 | | Treasury Stock Repurchases (Employee Tax Withholding) | (5,028) | (1,335) | | Class A Redeemable Convertible Preferred Stock Accrued Dividends | (1,928) | (1,799) | | LLC Interest Redemptions | — | — | | Ending Balance (June 30) | 279,092 | 327,799 | - As of June 30, 2025, the accumulated deficit attributable to GoHealth, Inc. increased to **$481,893 thousand**, reflecting ongoing net losses[41](index=41&type=chunk) - The weighted-average ownership percentage of non-controlling interests for the six months ended June 30, 2025, was **54.1%**, down from **56.5%** in the prior year period[85](index=85&type=chunk) [CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS](index=13&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) For the six months ended June 30, 2025, net cash used in operating activities increased to $50,222 thousand, while net cash from financing activities significantly increased due to higher Class A revolving credit facility borrowings - Condensed Consolidated Statements of Cash Flows Summary (Unaudited, in thousands of dollars) | Cash Flow Category | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | (50,222) | (23,984) | | Net Cash from Investing Activities | (5,877) | (7,258) | | Net Cash from Financing Activities | 50,667 | (45,391) | | Cash and Cash Equivalents, End of Period | 35,590 | 14,124 | - Net cash used in operating activities increased by **$26.2 million**, primarily due to increased net loss and reduced cash from working capital items like commissions receivable, prepaid expenses, and accrued liabilities[211](index=211&type=chunk) - Net cash provided by financing activities increased by **$96.1 million**, mainly due to increased borrowings under the Class A revolving credit facility and reduced term loan repayments[213](index=213&type=chunk) [NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS](index=14&type=section&id=NOTES%20TO%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section provides detailed notes to the condensed consolidated financial statements, covering business description, accounting policies, fair value, intangible assets, debt, equity, and subsequent events [1. DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES](index=14&type=section&id=1.%20DESCRIPTION%20OF%20BUSINESS%20AND%20SIGNIFICANT%20ACCOUNTING%20POLICIES) GoHealth is a leading health insurance marketplace and Medicare-focused digital health company, using its platform and licensed agents to help consumers select Medicare plans - GoHealth serves **67 million Medicare-eligible Americans** by simplifying Medicare plan selection through its technology platform and licensed agents[46](index=46&type=chunk)[154](index=154&type=chunk) - The company primarily offers Medicare Advantage, Medicare Supplement, and prescription drug plans, utilizing machine learning algorithms to match consumer needs[47](index=47&type=chunk) - The company has secured additional liquidity through the Superpriority Credit Agreement and Amendment No. 14, with management believing going concern doubts have been alleviated[55](index=55&type=chunk) - The Medicare Annual Enrollment Period (AEP) in Q4 drives increased submissions and related expenses, with Q1 being the second highest and Q2/Q3 the lowest[57](index=57&type=chunk) [2. FAIR VALUE MEASUREMENTS](index=15&type=section&id=2.%20FAIR%20VALUE%20MEASUREMENTS) The company measures financial instruments at fair value using a three-level hierarchy, recording impairment charges for operating leases and an indefinite-lived trade name using Level 3 inputs - The company categorizes fair value inputs into three levels: Level 1 (quoted prices in active markets), Level 2 (similar assets or non-active market quotes), and Level 3 (unobservable inputs)[61](index=61&type=chunk) - For the three and six months ended June 30, 2025, the company recorded **$0.1 million** and **$0.8 million**, respectively, in operating lease impairment charges due to termination or subleasing of office and call center spaces[63](index=63&type=chunk)[180](index=180&type=chunk) - For the three and six months ended June 30, 2025, the company recorded a **$53.0 million** impairment charge to its indefinite-lived trade name, reducing its carrying value to **$20.0 million**, estimated using the relief-from-royalty method under the income approach (Level 3 inputs)[64](index=64&type=chunk)[65](index=65&type=chunk)[179](index=179&type=chunk) [3. INTANGIBLE ASSETS, NET](index=16&type=section&id=3.%20INTANGIBLE%20ASSETS,%20NET) As of June 30, 2025, net intangible assets were $202,469 thousand, a significant decrease from $302,497 thousand, primarily due to a $53.0 million impairment of an indefinite-lived trade name - In Q2 2025, the company recorded a **$53.0 million** impairment charge to its indefinite-lived trade name, reducing its carrying value to **$20.0 million**[65](index=65&type=chunk)[179](index=179&type=chunk) - The impairment resulted from revised long-term forecasts reflecting a conscious scaling back of Medicare Advantage business activities due to tightening health plan economics[65](index=65&type=chunk) - Intangible Assets, Net (in thousands of dollars) | Category | Net Carrying Value June 30, 2025 | Net Carrying Value December 31, 2024 | | :--- | :--- | :--- | | Developed Technology | 85,029 | 120,457 | | Customer Relationships | 97,440 | 109,040 | | Indefinite-Lived Trade Name | 20,000 | 73,000 | | **Total Intangible Assets** | **202,469** | **302,497** | [4. LONG-TERM DEBT](index=17&type=section&id=4.%20LONG-TERM%20DEBT) As of June 30, 2025, total long-term debt was $560,003 thousand, including existing term loans and a Class A revolving credit facility, with subsequent amendments further adjusting debt terms - Long-Term Debt Composition (in thousands of dollars) | Debt Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Existing Term Loan | 490,803 | 475,000 | | Class A Revolving Credit Facility | 89,741 | 30,000 | | Less: Unamortized Debt Discount and Issuance Costs | (20,541) | (17,635) | | **Total Debt** | **560,003** | **487,365** | | Less: Current Portion of Long-Term Debt | — | (39,500) | | **Total Long-Term Debt** | **560,003** | **447,865** | - As of June 30, 2025, the outstanding principal for the existing term loan was **$490.8 million**, with an effective interest rate of **11.78%**[71](index=71&type=chunk) - As of June 30, 2025, the outstanding amount for the Class A revolving credit facility was **$89.7 million**, with no remaining available capacity[74](index=74&type=chunk) - Amendment No. 13, signed on June 30, 2025, extended the maturity date of the Class A revolving credit facility and allowed for payment-in-kind interest for both term loans and the Class A revolving credit facility[78](index=78&type=chunk) [5. STOCKHOLDERS' EQUITY](index=20&type=section&id=5.%20STOCKHOLDERS'%20EQUITY) The company's equity structure includes Class A common stock, Class B common stock, and redeemable convertible preferred stock, with specific voting, dividend, and conversion rights - The company's Class A and Class B common stock maintain a **one-to-one ratio** with GHH, LLC's LLC interests, and Class B common stockholders do not receive dividends[82](index=82&type=chunk)[83](index=83&type=chunk) - Non-controlling interests represent the economic interests of Continuing Equity Owners in GHH, LLC, with weighted-average ownership percentages of **53.2%** and **54.1%** for the three and six months ended June 30, 2025, respectively[85](index=85&type=chunk)[163](index=163&type=chunk) - Class A redeemable convertible preferred stock carries a **7.0% annual dividend rate** and is convertible into Class A common stock or Class A-1 convertible preferred stock under certain conditions[90](index=90&type=chunk)[91](index=91&type=chunk) - The company classifies Class A redeemable convertible preferred stock and Class A-1 convertible preferred stock as temporary equity because their redemption is not solely within the company's control[100](index=100&type=chunk) [6. SHARE-BASED COMPENSATION PLANS](index=22&type=section&id=6.%20SHARE-BASED%20COMPENSATION%20PLANS) For the three months ended June 30, 2025, total share-based compensation expense (benefit) was $(135) thousand, compared to $1,892 thousand in the prior year period - Share-Based Compensation Expense (Benefit) by Operating Function (Unaudited, in thousands of dollars) | Operating Function | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Marketing and Advertising | 85 | 52 | 149 | 128 | | Consumer Care and Enrollment | 148 | 328 | 428 | 652 | | Technology | 219 | 247 | 506 | 486 | | General and Administrative | (587) | 1,265 | 1,585 | 2,409 | | **Total Share-Based Compensation Expense (Benefit)** | **(135)** | **1,892** | **2,668** | **3,675** | - Share-based compensation expense for Q2 2025 turned into a benefit, primarily due to a negative benefit related to stock appreciation rights (SARs) within general and administrative expenses[101](index=101&type=chunk) [7. NET INCOME (LOSS) PER SHARE](index=23&type=section&id=7.%20NET%20INCOME%20(LOSS)%20PER%20SHARE) For the three months ended June 30, 2025, basic and diluted loss per share of Class A common stock was $5.10, an increase from $2.70 in the prior year, with diluted loss equal to basic loss - Basic and Diluted Net Loss Per Share of Class A Common Stock Calculation (Unaudited, in thousands of dollars, except per share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Loss Attributable to Common Stockholders - Basic and Diluted | (55,249) | (26,903) | (60,613) | (37,011) | | Weighted-Average Shares of Class A Common Stock - Basic and Diluted | 10,830 | 9,973 | 10,603 | 9,844 | | Net Loss Per Share of Class A Common Stock - Basic and Diluted | (5.10) | (2.70) | (5.72) | (3.76) | - Diluted loss per share is the same as basic loss per share because the inclusion of potentially issuable shares (including equity awards, redeemable convertible preferred stock, and Class B common stock) would be anti-dilutive[102](index=102&type=chunk)[103](index=103&type=chunk) [8. INCOME TAXES](index=23&type=section&id=8.%20INCOME%20TAXES) GoHealth, Inc. is taxed as a corporation, while GHH, LLC is taxed as a partnership. The company's effective tax rates for the three and six months ended June 30, 2025, were 0.30% and (0.60)%, respectively, below the statutory rate - GoHealth, Inc. is taxed as a corporation, while GHH, LLC is taxed as a partnership and does not pay federal income tax[104](index=104&type=chunk) - Effective Tax Rate | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Effective Tax Rate | 0.30% | 0.07% | (0.60)% | 0.14% | - The effective tax rate is lower than the statutory rate, primarily due to loss entities and losses attributable to non-controlling interests[105](index=105&type=chunk) - As of June 30, 2025, and December 31, 2024, the liability related to the tax receivable agreement was **$1.1 million**[107](index=107&type=chunk) [9. REVENUE](index=24&type=section&id=9.%20REVENUE) Company revenue primarily derives from Medicare insurance product sales and management. For the three months ended June 30, 2025, total net revenue decreased by 11.2% to $94,048 thousand - Revenue Breakdown (Unaudited, in thousands of dollars) | Revenue Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Medicare Agency Commission Revenue | 73,322 | 70,553 | 240,431 | 150,286 | | Medicare Partner Marketing and Other Revenue | 7,852 | 14,127 | 28,376 | 33,517 | | **Total Medicare Agency Revenue** | **81,174** | **84,680** | **268,807** | **183,803** | | Medicare Non-Agency Revenue | 4,211 | 20,444 | 35,982 | 106,346 | | **Total Medicare Revenue** | **85,385** | **105,124** | **304,789** | **290,149** | | Other Non-Agency Revenue | 8,417 | 309 | 9,701 | 472 | | Other Agency Revenue | 246 | 437 | 530 | 849 | | **Total Other Revenue** | **8,663** | **746** | **10,231** | **1,321** | | **Total Net Revenue** | **94,048** | **105,870** | **315,020** | **291,470** | - Medicare agency revenue, including commission revenue and partner marketing and other revenue, is estimated based on the expected policy life and historical experience[110](index=110&type=chunk)[112](index=112&type=chunk) - Medicare non-agency revenue, including enrollment and engagement services like Encompass Connect and Encompass Engage, and GoHealth Protect products, is recognized when services are provided or near the point of sale[114](index=114&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - As of June 30, 2025, the ending balance of commissions receivable was **$996,604 thousand**, with **$770,452 thousand** classified as non-current[122](index=122&type=chunk) - Revenue Concentration by Major Customer | Customer | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | United | 43.4 % | 22.2 % | 39.2 % | 18.3 % | | Humana | 22.7 % | 25.3 % | 27.2 % | 20.3 % | | Elevance Health | 14.2 % | 15.6 % | 12.3 % | 20.1 % | [10. LEASES](index=26&type=section&id=10.%20LEASES) The company has operating lease agreements maturing between 2025 and 2032, incurring net lease expenses of $1,312 thousand and $2,845 thousand for the three and six months ended June 30, 2025, respectively - Lease Expense Components (Unaudited, in thousands of dollars) | Lease Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Operating Lease Cost | 1,778 | 2,001 | 3,988 | 3,947 | | Short-Term Lease Cost | — | 16 | 3 | 37 | | Variable Lease Cost | 36 | 109 | 82 | 271 | | Sublease Income | (502) | (669) | (1,228) | (1,176) | | **Total Net Lease Expense** | **1,312** | **1,457** | **2,845** | **3,079** | - The company incurred **$0.1 million** and **$0.8 million** in operating lease impairment charges for Q2 and H1 2025, respectively, due to terminating or subleasing portions of office and call center spaces[127](index=127&type=chunk)[180](index=180&type=chunk) - The company recognized a one-time gain of **$0.1 million** and **$0.3 million** for Q2 and H1 2025, respectively, from lease liability remeasurement and right-of-use asset adjustments due to early lease terminations[127](index=127&type=chunk) - As of June 30, 2025, the weighted-average remaining operating lease term was **6.2 years**, with a weighted-average discount rate of **9.4%**[129](index=129&type=chunk) [11. COMMITMENTS AND CONTINGENCIES](index=27&type=section&id=11.%20COMMITMENTS%20AND%20CONTINGENCIES) The company faces multiple legal proceedings, including a derivative lawsuit and a False Claims Act lawsuit intervened by the Department of Justice, alleging violations in health plan partner arrangements - The company faces a derivative lawsuit alleging breaches of fiduciary duty by certain officers and directors, which is currently stayed[130](index=130&type=chunk)[131](index=131&type=chunk) - The Department of Justice has intervened in a False Claims Act lawsuit against the company, alleging illegal compensation and discriminatory practices in arrangements with health plan partners[132](index=132&type=chunk)[239](index=239&type=chunk) - This lawsuit could result in treble damages, civil penalties, and costs, which the company intends to vigorously defend, but the outcome could materially adversely affect its financial condition[132](index=132&type=chunk)[239](index=239&type=chunk) [12. RELATED PARTY TRANSACTIONS](index=29&type=section&id=12.%20RELATED%20PARTY%20TRANSACTIONS) The company has multiple lease agreements with entities controlled by significant stockholders, paying $1.0 million and $2.2 million in lease payments for the three and six months ended June 30, 2025, respectively - The company has lease agreements for office space with entities controlled by significant stockholders[133](index=133&type=chunk) - Related Party Lease Payments (Unaudited, in thousands of dollars) | Period | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Lease Payments | 1,000 | 1,500 | 2,200 | 3,000 | [13. SEGMENT REPORTING](index=29&type=section&id=13.%20SEGMENT%20REPORTING) The company operates as a single reportable segment focused on Medicare product sales and management, with the CEO assessing performance based on consolidated net income (loss) - The company has a single operating and reportable segment focused on Medicare product sales and management[134](index=134&type=chunk)[135](index=135&type=chunk) - The Chief Operating Decision Maker (CEO) assesses the company's performance and allocates resources based on consolidated net income (loss)[135](index=135&type=chunk)[137](index=137&type=chunk)[138](index=138&type=chunk) - The vast majority of the company's revenue is derived from U.S. customers, and all assets are primarily located in the U.S[136](index=136&type=chunk) [14. SUBSEQUENT EVENTS](index=29&type=section&id=14.%20SUBSEQUENT%20EVENTS) On August 6, 2025, the company completed strategic capital and governance actions, including a Superpriority Credit Agreement for $115 million in senior secured superpriority term loans and Amendment No. 14 - On August 6, 2025, the company signed the Superpriority Credit Agreement, establishing a **$115.0 million** senior secured superpriority term loan, including **$80.0 million** in new money and **$35.0 million** in rolled-over loans[140](index=140&type=chunk)[221](index=221&type=chunk) - Proceeds from the Superpriority Facility will be used for working capital, general corporate purposes, and transaction expenses, maturing on August 5, 2029[140](index=140&type=chunk)[221](index=221&type=chunk) - The Superpriority Facility includes a minimum liquidity covenant requiring the company to maintain minimum liquidity between **$5.0 million** and **$30.0 million** on specific dates[144](index=144&type=chunk) - Amendment No. 14 terminated the Class A-1 and Class A revolving credit facility commitments, extended the maturity of the remaining Class A revolving loans to August 5, 2029, and waived principal payments on existing term loans until December 31, 2026[147](index=147&type=chunk)[148](index=148&type=chunk)[220](index=220&type=chunk) - As consideration for Amendment No. 14, the company issued **4,766,219 shares of Class A common stock** to lenders, representing **19.99%** of the total Class A and Class B common stock outstanding prior to the transaction[150](index=150&type=chunk)[241](index=241&type=chunk)[242](index=242&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS.](index=34&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITIONS%20AND%20RESULTS%20OF%20OPERATIONS.) This section provides management's discussion and analysis of the company's financial condition and operating results, covering business overview, strategy, ownership, performance, non-GAAP metrics, and liquidity [Overview](index=34&type=section&id=Overview) GoHealth is a leading health insurance marketplace and Medicare-focused digital health company, simplifying complex health plan choices for 67 million Medicare-eligible Americans - GoHealth aims to simplify the Medicare plan enrollment process by providing education, comparative guidance, transparency, and choice[154](index=154&type=chunk) - The company partners with health plans to offer high-quality health plans across all 50 states and the District of Columbia[154](index=154&type=chunk) [Update on Business Trends and Strategy](index=34&type=section&id=Update%20on%20Business%20Trends%20and%20Strategy) GoHealth is transitioning from a traditional Medicare enrollment company to a Medicare engagement company, focusing on high-quality consumer relationships through its Encompass operating model - The company has transitioned from a traditional Medicare enrollment company to a Medicare engagement company, focusing on consumer care through its Encompass operating model[155](index=155&type=chunk) - GoHealth Protect, launched in Q1 2025, expands into guaranteed issue life insurance, aiming to support the existing customer base and contribute future revenue[157](index=157&type=chunk) - The company leverages AI and automation to enhance its platform, improving operational efficiency and consumer engagement, including launching web self-enrollment workflows and AI agents[159](index=159&type=chunk) - In Q2 2025, the company consciously scaled back Medicare Advantage activities in response to tightening health plan economics and the non-commissioning of some plans[161](index=161&type=chunk) - The CMS 2026 plan year final rate notice announced an average **5.06% increase** in Medicare Advantage revenue and a **10.72% increase** in broker commissions[161](index=161&type=chunk) - The company's Board of Directors established a "Transformation Committee" to review, develop, and negotiate strategic alternatives, including refinancing, securitization, M&A, or restructuring[162](index=162&type=chunk) [Ownership](index=35&type=section&id=Ownership) GoHealth, Inc. is the sole managing member of GHH, LLC, controlling its business and consolidating financial results, with non-controlling interests representing Continuing Equity Owners' economic stake - GoHealth, Inc. holds the sole voting and control rights of GHH, LLC and consolidates its financial results[163](index=163&type=chunk) - The weighted-average ownership percentage of non-controlling interests was **53.2%** and **54.1%** for Q2 and H1 2025, respectively[163](index=163&type=chunk) - The company is required to make distributions to GHH, LLC to cover expenses incurred as a public company and payments under the tax receivable agreement[167](index=167&type=chunk) [Results of Operations](index=37&type=section&id=Results%20of%20Operations) For the three months ended June 30, 2025, net revenue decreased by 11.2% to $94,048 thousand, with operating loss expanding to $99,386 thousand and net loss at $115,989 thousand, impacted by a $53.0 million intangible asset impairment - Condensed Consolidated Results of Operations Summary (Unaudited, in thousands of dollars) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Revenue | 94,048 | 105,870 | 315,020 | 291,470 | | Operating Income (Loss) | (99,386) | (40,610) | (92,717) | (44,642) | | Net Income (Loss) | (115,989) | (59,314) | (125,775) | (80,660) | | EBITDA | (73,200) | (14,960) | (39,453) | 7,819 | | Adjusted EBITDA | (11,295) | (12,308) | 30,765 | 14,585 | | Net Income (Loss) Margin | (123.3)% | (56.0)% | (39.9)% | (27.7)% | | Adjusted EBITDA Margin | (12.0)% | (11.6)% | 9.8 % | 5.0 % | - Net revenue for Q2 2025 decreased by **11.2% year-over-year**, primarily due to the company's conscious scaling back of Medicare Advantage activities, partially offset by the launch of GoHealth Protect[169](index=169&type=chunk) - Revenue share expenses for Q2 2025 increased by **56.7% year-over-year**, mainly due to increased external agent submissions[170](index=170&type=chunk)[171](index=171&type=chunk) - Marketing and advertising expenses for Q2 2025 decreased by **26.2% year-over-year**, primarily due to a conscious reduction in marketing spend to align with the GoHealth Protect launch[172](index=172&type=chunk) - Consumer care and enrollment expenses for Q2 2025 decreased by **33.3% year-over-year**, primarily due to a reduction in agent headcount[173](index=173&type=chunk) - Intangible asset impairment expense for Q2 2025 was **$53.0 million**, compared to zero in the prior year period[179](index=179&type=chunk) [Non-GAAP Financial Measures](index=39&type=section&id=Non-GAAP%20Financial%20Measures) The company uses non-GAAP financial measures like EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin to assess performance, with Adjusted EBITDA for the three months ended June 30, 2025, at $(11,295) thousand - Reconciliation of GAAP Net Income (Loss) to EBITDA and Adjusted EBITDA (Unaudited, in thousands of dollars) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income (Loss) | (115,989) | (59,314) | (125,775) | (80,660) | | EBITDA | (73,200) | (14,960) | (39,453) | 7,819 | | Share-Based Compensation Expense (Benefit) | (135) | 1,892 | 2,668 | 3,675 | | Professional Service Fees | 6,585 | — | 7,381 | — | | Legal Fees | 2,417 | 174 | 2,842 | 677 | | Operating Lease Impairment and Other Expenses | 38 | — | 512 | — | | Intangible Asset Impairment Expense | 53,000 | — | 53,000 | — | | Severance Expenses | — | 586 | 3,815 | 2,414 | | **Adjusted EBITDA** | **(11,295)** | **(12,308)** | **30,765** | **14,585** | | Adjusted EBITDA Margin | (12.0)% | (11.6)% | 9.8 % | 5.0 % | - Adjusted EBITDA loss for Q2 2025 narrowed by **8.2% year-over-year**, driven by improved agent productivity, targeted marketing, and proprietary technology enhancements, partially offset by decreased net revenue[188](index=188&type=chunk) - Adjusted EBITDA for H1 2025 increased by **110.9% year-over-year**, primarily due to increased net revenue and improved operating efficiency[188](index=188&type=chunk) [Key Business Performance and Operating Metrics](index=42&type=section&id=Key%20Business%20Performance%20and%20Operating%20Metrics) The company uses Submissions, Sales per Submission, and Direct Operating Cost per Submission to evaluate business performance, with Q2 2025 submissions down 7.5% and H1 2025 submissions up 20.5% - Key Business Performance and Operating Metrics (Unaudited) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Submissions | 140,991 | 152,394 | 444,103 | 368,542 | | Sales per Submission | 657 | 690 | 703 | 787 | | Direct Operating Cost per Submission | 613 | 641 | 551 | 640 | | Sales per Submission / Direct Operating Cost per Submission | 1.1 | 1.1 | 1.3 | 1.2 | - Submissions for Q2 2025 decreased by **7.5% year-over-year**, primarily due to reduced internal agent submissions, reflecting a shift in focus to GoHealth Protect[194](index=194&type=chunk) - Submissions for H1 2025 increased by **20.5% year-over-year**, primarily due to increased external agent submissions and higher agent headcount from the e-TeleQuote acquisition[194](index=194&type=chunk) - Sales per Submission decreased in Q2 and H1 2025, mainly due to a shift in focus to GoHealth Protect (which has lower revenue per submission) and changes in carrier mix within non-agency channels[198](index=198&type=chunk) - Direct Operating Cost per Submission decreased in Q2 and H1 2025, primarily driven by improved agent productivity and technology investments[202](index=202&type=chunk) [Liquidity and Capital Resources](index=45&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, cash and cash equivalents were $35.6 million. Management believes the company has sufficient liquidity for the next 12 months through operating cash flow, existing cash, and Superpriority New Money Term Loans - As of June 30, 2025, cash and cash equivalents were **$35.6 million**[204](index=204&type=chunk) - Management believes the liquidity provided by the Superpriority Facility is sufficient to meet operating and debt obligations for the next 12 months, alleviating substantial doubt about going concern[204](index=204&type=chunk) - Cash Flow Summary (Unaudited, in thousands of dollars) | Cash Flow Category | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | (50,222) | (23,984) | | Net Cash from Investing Activities | (5,877) | (7,258) | | Net Cash from Financing Activities | 50,667 | (45,391) | - Net cash used in operating activities for H1 2025 increased by **$26.2 million**, primarily due to increased net loss and changes in working capital[211](index=211&type=chunk) - Net cash provided by financing activities for H1 2025 was **$50.7 million**, a significant improvement from a net outflow of **$45.4 million** in the prior year period, mainly due to increased Class A revolving credit facility borrowings[213](index=213&type=chunk) [Recent Accounting Pronouncements](index=48&type=section&id=Recent%20Accounting%20Pronouncements) This section refers to the discussion of recent accounting pronouncements in Note 1 to the financial statements - The company is evaluating the impact of ASU 2023-09 (Income Tax Disclosures Improvements) and ASU 2024-03 (Expense Disaggregation Disclosures in the Income Statement) on its disclosures[58](index=58&type=chunk)[59](index=59&type=chunk) [Critical Accounting Policies and Estimates](index=48&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) The company relies on estimates and assumptions in preparing financial statements, with intangible asset valuation being a critical area, including a $53.0 million impairment of an indefinite-lived trade name in Q2 2025 - The company relies on estimates and assumptions for revenue, expenses, assets, and liabilities when preparing financial statements[224](index=224&type=chunk) - In Q2 2025, the company recorded a **$53.0 million** impairment charge to its indefinite-lived trade name, reducing its carrying value to **$20.0 million**, due to revised long-term forecasts[226](index=226&type=chunk) - Fair value valuation of intangible assets involves significant estimates and assumptions, such as revenue forecasts, royalty rates, and discount rates, where changes could lead to additional impairments[226](index=226&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.](index=49&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK.) As a smaller reporting company, GoHealth, Inc. is not required to include quantitative and qualitative disclosures about market risk in this report - As a smaller reporting company, the company is exempt from disclosing quantitative and qualitative information about market risk[227](index=227&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES.](index=49&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES.) Management assessed the effectiveness of the company's disclosure controls and procedures and internal control over financial reporting as of June 30, 2025, concluding they were effective, excluding the e-TeleQuote acquisition - Management concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2025[228](index=228&type=chunk)[231](index=231&type=chunk) - Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP[229](index=229&type=chunk)[230](index=230&type=chunk)[232](index=232&type=chunk) - In assessing the effectiveness of internal control over financial reporting, the company excluded the e-TeleQuote acquisition, as SEC guidance permits exclusion during the first year post-acquisition[233](index=233&type=chunk) - No material changes occurred in internal control over financial reporting during the quarter[234](index=234&type=chunk) [PART II - OTHER INFORMATION](index=52&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [ITEM 1. LEGAL PROCEEDINGS.](index=52&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS.) The company faces multiple legal proceedings, including a derivative lawsuit and a False Claims Act lawsuit intervened by the Department of Justice, alleging violations in health plan partner arrangements - The company faces a derivative lawsuit and a False Claims Act lawsuit intervened by the Department of Justice[132](index=132&type=chunk)[237](index=237&type=chunk)[239](index=239&type=chunk) - The False Claims Act lawsuit alleges illegal compensation and discriminatory practices in arrangements with health plan partners, potentially leading to treble damages, civil penalties, and costs[132](index=132&type=chunk)[239](index=239&type=chunk) [ITEM 1A. RISK FACTORS.](index=52&type=section&id=ITEM%201A.%20RISK%20FACTORS.) Risk factors include potential adverse impacts from legal proceedings, renewed going concern doubts due to liquidity, and stock price depreciation from the issuance of Class A common stock - Legal proceedings and government investigations can be time-consuming, distract management, incur significant expenses, and harm relationships with partners, lenders, and investors[239](index=239&type=chunk) - The company's liquidity position previously raised substantial doubt about its ability to continue as a going concern, and despite new credit agreements, it could deteriorate or fail to comply with financial covenants in the future[240](index=240&type=chunk) - The issuance of **4,766,219 shares of Class A common stock** to lenders on August 6, 2025, could lead to a decrease in stock price and dilution of existing stockholders' holdings[150](index=150&type=chunk)[241](index=241&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.](index=53&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS.) The company had no unregistered securities sales for the three months ended June 30, 2025, but issued 4,766,219 shares of Class A common stock to lenders on August 6, 2025, as consideration for a credit agreement amendment - No unregistered securities sales occurred in Q2 2025[242](index=242&type=chunk) - On August 6, 2025, as consideration for Amendment No. 14 to the credit agreement, the company issued **4,766,219 shares of Class A common stock** to lenders[242](index=242&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES.](index=53&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES.) No defaults upon senior securities occurred during this reporting period - No defaults upon senior securities occurred during this reporting period[244](index=244&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES.](index=53&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES.) The company is not required to provide mine safety disclosures for this reporting period - No mine safety disclosures are required for this reporting period[246](index=246&type=chunk) [ITEM 5. OTHER INFORMATION.](index=53&type=section&id=ITEM%205.%20OTHER%20INFORMATION.) No Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements were adopted, modified, or terminated by any director or officer during the quarter ended June 30, 2025 - No Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements were adopted, modified, or terminated by company directors or senior officers during Q2 2025[247](index=247&type=chunk) [ITEM 6. EXHIBITS.](index=54&type=section&id=ITEM%206.%20EXHIBITS.) This section lists all exhibits filed with this quarterly report, including articles of incorporation, credit agreement amendments, equity incentive plans, and executive certifications - Exhibits include articles of incorporation, credit agreement amendments (e.g., Amendment No. 13 and Amendment No. 14), the Superpriority Senior Secured Credit Agreement, equity incentive plans, and executive certification documents[249](index=249&type=chunk) [SIGNATURES](index=55&type=section&id=SIGNATURES) [Signatures](index=55&type=section&id=Signatures) This report was duly signed by GoHealth, Inc.'s Chief Executive Officer, Vijay Kotte, and Chief Financial Officer, Brendan Shanahan, on August 12, 2025 - This report was signed by CEO Vijay Kotte and CFO Brendan Shanahan on August 12, 2025[253](index=253&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _________ Commission File No. 1-31785 MEXCO ENERGY CORPORATION (Exact name of registrant as specified in its charter) Colorado 84-0627918 (State or other juri ...

[Cautionary Statement Regarding Forward-Looking Statements](index=1&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section warns that forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from expectations [Risks and Uncertainties](index=1&type=section&id=Risks%20and%20Uncertainties) This section highlights that forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from expectations - Forward-looking statements are subject to significant uncertainties and contingencies that are difficult or impossible to predict, potentially causing actual results to differ materially[1](index=1&type=chunk)[2](index=2&type=chunk) - Key risk factors include ability to maintain customer relationships, future operating and financial results, vessel acquisitions/sales, financial condition and liquidity, oil tanker industry trends, dependence on technical manager, vessel aging, operational hazards, regulatory changes, geopolitical conditions (e.g., Russia-Ukraine, Israel-Hamas, Houthi crisis), and changes in oil demand[3](index=3&type=chunk)[5](index=5&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=5&type=section&id=MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on the company's financial performance, condition, and operational results, including key factors, accounting policies, and liquidity [Principal Factors Affecting Our Business](index=5&type=section&id=Principal%20Factors%20Affecting%20Our%20Business) The company's financial performance is primarily influenced by fleet size, charter rates, charter duration, operating costs, maintenance, vessel age, and financing decisions - Principal factors affecting the business include the number of vessels, various charter rates (voyage, time trip, period), nature and duration of charters, vessel repositioning, operating and voyage costs, maintenance, vessel age/condition, share issuance, debt obligations, and financing costs[9](index=9&type=chunk)[10](index=10&type=chunk) - Period time charters offer predictable cash flows but potentially lower profit margins, while spot charters are less predictable but can yield higher margins in favorable market conditions, though they expose owners to declining rates and rising fuel costs[9](index=9&type=chunk)[11](index=11&type=chunk) [Material Accounting Policies and Critical Accounting Estimates](index=7&type=section&id=Material%20Accounting%20Policies%20and%20Critical%20Accounting%20Estimates) The company refers to its 2024 Annual Report for detailed accounting policies and estimates, confirming no material changes for the six months ended June 30, 2025 - No material changes have occurred in critical accounting judgments and key sources of estimation uncertainty since the 2024 Annual Report[12](index=12&type=chunk) [Important Financial and Operational Terms and Concepts](index=7&type=section&id=Important%20Financial%20and%20Operational%20Terms%20and%20Concepts) This section defines key financial and operational terms like revenue components, expense categories, and performance metrics such as Daily Time Charter Equivalent (TCE) Rate and Daily Vessel Operating Expenses (Opex) - Revenues are primarily from time and voyage charters, affected by hire rates, operating days, and the mix of business, with voyage charters being more volatile due to market rates[13](index=13&type=chunk) - Key expense categories include commissions (up to **3.75%** of charter hire), voyage expenses (port, canal, bunker costs for voyage charters), vessel operating expenses (crewing, insurance, repairs), drydocking costs, general and administrative expenses, and management fees (**$900 per vessel/day**)[15](index=15&type=chunk)[16](index=16&type=chunk)[17](index=17&type=chunk)[18](index=18&type=chunk)[20](index=20&type=chunk)[21](index=21&type=chunk) - Inflation impacts vessel operating expenses and corporate overheads, with insurance and crew costs expected to rise, and interest on SOFR-based loans can increase with central bank rate hikes[22](index=22&type=chunk) - Key performance indicators include Calendar days (total days in possession), Operating days (revenue-generating days), Off-hire (non-chartered/non-performing days), Fleet utilization (operating days / calendar days), Daily TCE Rate (TCE revenue / operating days), and Daily Opex (vessel operating expenses + technical management fees / calendar days)[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) [Main Components of Business Management and Profitability Drivers](index=11&type=section&id=Main%20components%20of%20managing%20our%20business%20and%20main%20drivers%20of%20profitability) Business management encompasses financial administration, reporting, compliance, and relationship management, while profitability is driven by charter rates, utilization, costs, depreciation, and financing - Business management components include financial resource administration, accounting and reporting, legal and regulatory compliance, and managing relationships with service providers and customers[31](index=31&type=chunk) - Profitability drivers are charter rates and periods, vessel utilization, operating and drydocking costs, depreciation and amortization, financing costs, and foreign exchange rate fluctuations[31](index=31&type=chunk) [Results of Operations](index=13&type=section&id=Results%20of%20Operations) For the six months ended June 30, 2025, the company experienced a significant decrease in revenue and operating profit compared to the prior year, primarily due to a lower fleetwide Daily TCE Rate [Condensed Statement of Profit or Loss (Six months ended June 30)](index=13&type=section&id=Condensed%20Statement%20of%20profit%20or%20loss%20and%20other%20comprehensive%20income) | USD | 2025 | 2024 | Change Amount | | :--- | :--- | :--- | :--- | | Revenue | $174,094,786 | $223,110,983 | $(49,016,197) | | Voyage expenses (incl. commissions) | $(61,525,511) | $(62,643,977) | $1,118,466 | | Vessel operating expenses (incl. Mgmt. fees) | $(24,326,471) | $(23,692,085) | $(634,386) | | Depreciation and amortization | $(20,565,522) | $(20,331,446) | $(234,076) | | General and administrative expenses | $(8,463,067) | $(7,669,010) | $(794,057) | | Operating profit | $59,214,215 | $108,774,465 | $(49,560,250) | | Interest income | $815,603 | $1,974,382 | $(1,158,779) | | Interest expense and other finance costs | $(24,164,014) | $(28,683,315) | $4,519,301 | | Gain/ (loss), net on derivatives | $2,863,108 | $(481,924) | $3,345,032 | | Foreign exchange gain/ (loss) | $713,930 | $(461,320) | $1,175,250 | | Total comprehensive income for the period | $39,442,842 | $81,122,288 | $(41,679,446) | [Performance Indicators](index=13&type=section&id=Performance%20Indicators) Key performance indicators reveal a **21.97%** revenue decrease and a **30.7%** drop in Daily TCE Rate for H1 2025, leading to a **51.4%** decline in net profit - Revenue decreased by **$49.0 million** (**21.97%**) to **$174.1 million** in H1 2025 from **$223.1 million** in H1 2024, primarily due to a decrease in fleetwide Daily TCE Rate[34](index=34&type=chunk) - Daily TCE Rate decreased by **30.7%** to **$44,529** in H1 2025 from **$64,254** in H1 2024[34](index=34&type=chunk)[39](index=39&type=chunk) - Net profit for H1 2025 was **$39.4 million** (**$1.23 EPS**), a **51.4%** decrease from **$81.1 million** (**$2.52 EPS**) in H1 2024, mainly due to lower revenues[34](index=34&type=chunk) [Key Performance Indicators (Six months ended June 30)](index=13&type=section&id=Performance%20Indicators) | Indicator | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $174,094,786 | $223,110,983 | $(49,016,197) | | Daily TCE Rate | $44,529 | $64,254 | $(19,725) | | Voyage expenses | $(59,517,139) | $(60,238,825) | $721,686 | | Commissions | $(2,008,372) | $(2,405,152) | $396,780 | | Vessel operating expenses | $22,045,871 | $21,398,885 | $646,986 | | Management fees | $2,280,600 | $2,293,200 | $(12,600) | | General and administrative expenses | $8,463,067 | $7,669,010 | $794,057 | | Interest and finance costs | $24,164,014 | $28,683,315 | $(4,519,301) | | Net Profit | $39,442,842 | $81,122,288 | $(41,679,446) | | Basic & Diluted EPS | $1.23 | $2.52 | $(1.29) | | Operating days | 2,528 | 2,497 | 31 | | Daily Opex | $9,600 | $9,298 | $302 | [Liquidity and Capital Resources](index=16&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity, funded by equity, debt, and operating cash flow, supports capital expenditures and debt servicing, with total indebtedness decreasing and working capital improving [Cash Flows (Six months ended June 30)](index=18&type=section&id=Cash%20Flows) | USD | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $49,287,325 | $125,339,642 | $(76,052,317) | | Net cash used in investing activities | $(1,892,675) | $(1,299,918) | $(592,757) | | Net cash used in financing activities | $(38,073,473) | $(80,712,029) | $42,638,556 | | Net change in cash and cash equivalents | $9,321,177 | $43,327,695 | $(34,006,518) | | Cash and cash equivalents at end of period | $59,753,419 | $92,798,770 | $(33,045,351) | - Decrease in net cash from operating activities was mainly due to a **$49.0 million** decrease in revenues and movements in working capital[52](index=52&type=chunk) - Net cash used in financing activities decreased due to lower distributions paid to shareholders (**$21.6 million** in 2025 vs. **$56.7 million** in 2024) and lower net debt outflows[52](index=52&type=chunk)[53](index=53&type=chunk) [Total Debt Obligations (as of June 30, 2025)](index=20&type=section&id=Credit%20Facilities%20and%20Other%20Financing%20Arrangements) | Metric | Amount (USD) | | :--- | :--- | | Outstanding Balance | $636,009,067 | | Unamortized Deferred Financing Fees | $5,182,480 | | Net of Loan Financing Fees | $630,826,587 | | Other Finance-lease liabilities | $70,959 | | Total Net Debt | $630,897,546 | | Interest Rate (SOFR+Margin) | S+2.27% | - Repurchased Milos in February 2024 and Poliegos in July 2024, ending their respective sale and leaseback agreements[64](index=64&type=chunk)[65](index=65&type=chunk) - Repurchased Nissos Nikouria and Nissos Kea in June 2025, ending their sale and leaseback arrangement[68](index=68&type=chunk) - Entered into new secured credit facilities in 2025 to finance the repurchase of Nissos Kea (**$65.0 million**) and Nissos Nikouria and Nissos Anafi (**$130.0 million**)[72](index=72&type=chunk)[73](index=73&type=chunk) - The company prepaid the **$58.0 million** secured term loan facility for Nissos Anafi in February 2024 and repaid the **$35.1 million** unsecured sponsor loan in March and May 2024[58](index=58&type=chunk)[70](index=70&type=chunk) - The **$125.7 million** secured term loan facility for Nissos Kythnos was repaid on May 24, 2024, and the margin for Nissos Donoussa was reduced to **165 basis points** over Term SOFR[54](index=54&type=chunk)[55](index=55&type=chunk) - The company was in compliance with all financial covenants as of June 30, 2025[116](index=116&type=chunk) [Fleet](index=26&type=section&id=Fleet) As of June 30, 2025, the company operated a fleet of **14 vessels**, with an average age of **5.9 years** and a total capacity of approximately **3.5 million deadweight tons** - As of June 30, 2025, the fleet comprised **14 vessels** with an average age of **5.9 years** and **3.5 million deadweight tons** capacity[74](index=74&type=chunk) - The fleet consists of **six Suezmax vessels** (average age **6.8 years**) and **eight VLCC vessels** (average age **5.2 years**)[77](index=77&type=chunk) [Dividend Policy](index=26&type=section&id=Dividend%20Policy) Dividend declaration is discretionary, based on financial performance, market conditions, capital needs, and loan restrictions, with no assurance of future payments - Dividend declaration is discretionary, based on earnings, financial condition, market prospects, capital expenditures, loan restrictions, and Marshall Islands law[74](index=74&type=chunk) - The company intends to pay dividends based on net profits, adjusted for non-recurring items, working capital needs, and capital structure[74](index=74&type=chunk) - No assurance that dividends will be paid in the future, and amounts may vary significantly[75](index=75&type=chunk) [Interim Condensed Consolidated Financial Statements (Unaudited)](index=28&type=section&id=INDEX%20TO%20INTERIM%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS%20(UNAUDITED)) This section presents the unaudited interim consolidated financial statements, including statements of profit or loss, financial position, changes in equity, and cash flows, along with explanatory notes [Unaudited Condensed Consolidated Statements of Profit or Loss (Six months ended June 30)](index=29&type=section&id=Unaudited%20condensed%20consolidated%20statements%20of%20profit%20or%20loss%20and%20other%20comprehensive%20income%20for%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024) | USD | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | $174,094,786 | $223,110,983 | | Total operating expenses | $(114,880,571) | $(114,336,518) | | Operating profit | $59,214,215 | $108,774,465 | | Total other expenses, net | $(19,771,373) | $(27,652,177) | | Profit for the period | $39,442,842 | $81,122,288 | | Earnings per share - basic & diluted | $1.23 | $2.52 | [Unaudited Condensed Consolidated Statements of Financial Position (as of)](index=30&type=section&id=Unaudited%20condensed%20consolidated%20statements%20of%20financial%20position%20as%20of%20June%2030%2C%202025%20and%20December%2031%2C%202024) | USD | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total non-current assets | $946,286,937 | $963,187,726 | | Total current assets | $136,833,282 | $118,911,883 | | TOTAL ASSETS | $1,083,120,219 | $1,082,099,609 | | Total shareholders' equity | $428,299,706 | $410,426,916 | | Total non-current liabilities | $585,029,821 | $599,002,128 | | Total current liabilities | $69,790,692 | $72,670,565 | | TOTAL LIABILITIES | $654,820,513 | $671,672,693 | - Vessels, net decreased from **$958.6 million** (Dec 31, 2024) to **$938.7 million** (June 30, 2025)[80](index=80&type=chunk) - Cash & cash equivalents increased from **$49.3 million** (Dec 31, 2024) to **$59.8 million** (June 30, 2025)[80](index=80&type=chunk) - Long-term borrowings, net of current portion, decreased from **$599.0 million** (Dec 31, 2024) to **$583.9 million** (June 30, 2025)[80](index=80&type=chunk) [Unaudited Condensed Consolidated Statements of Changes in Shareholders' Equity (Six months ended June 30)](index=31&type=section&id=Unaudited%20condensed%20consolidated%20statements%20of%20changes%20in%20shareholders%27%20equity%20for%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024) | USD | Balance - Jan 1, 2025 | Profit for the period | Dividends paid | Balance - June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Total shareholders' equity | $410,426,916 | $39,442,842 | $(21,570,052) | $428,299,706 | | | | | | | | USD | Balance - Jan 1, 2024 | Profit for the period | Capital distribution | Balance - June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total shareholders' equity | $408,132,148 | $81,122,288 | $(56,661,629) | $432,592,807 | [Unaudited Condensed Consolidated Statements of Cash Flows (Six months ended June 30)](index=32&type=section&id=Unaudited%20condensed%20consolidated%20statements%20of%20cash%20flows%20for%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024) | USD | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $49,287,325 | $125,339,642 | | Net cash used in investing activities | $(1,892,675) | $(1,299,918) | | Net cash used in financing activities | $(38,073,473) | $(80,712,029) | | Net change in cash and cash equivalents | $9,321,177 | $43,327,695 | | Cash and cash equivalents at end of period | $59,753,419 | $92,798,770 | [Notes to Unaudited Interim Condensed Consolidated Financial Statements](index=33&type=section&id=Notes%20to%20unaudited%20interim%20condensed%20consolidated%20financial%20statements) These notes provide detailed information on the company's incorporation, accounting policies, financial risk factors, vessel assets, long-term borrowings, derivative instruments, related party transactions, share capital, earnings per share, revenue breakdown, commitments, contingencies, and significant subsequent events [1. Incorporation and General Information](index=33&type=section&id=1.%20Incorporation%20and%20General%20Information) OET was incorporated in the Marshall Islands in 2018, with controlling interests held by Glafki Marine Corp. and Hospitality Assets Corp., and its shares trade on the NYSE and Oslo Stock Exchange - OET was incorporated on April 30, 2018, in the Republic of the Marshall Islands[83](index=83&type=chunk) - Glafki Marine Corp. and Hospitality Assets Corp. (controlled by Ioannis and Themistoklis Alafouzos) collectively hold a controlling interest in OET, owning **34.2%** and **20.6%** of outstanding common shares, respectively[83](index=83&type=chunk)[84](index=84&type=chunk) - The company's common shares began primarily trading on the NYSE on December 11, 2023, with a secondary listing on the Oslo Stock Exchange[86](index=86&type=chunk) [2. General Accounting Principles](index=34&type=section&id=2.%20General%20accounting%20principles) Financial statements are prepared under IAS 34 in USD, with no material changes to accounting policies since the 2024 Annual Report, though new IFRS standards are pending adoption - Financial statements prepared in accordance with IAS 34 Interim Financial Reporting and expressed in USD[88](index=88&type=chunk)[89](index=89&type=chunk) - No material changes to accounting policies since the 2024 Annual Report[91](index=91&type=chunk) - New IFRS standards (IFRS 18, amendments to IFRS 9 and IFRS 7, Annual Improvements to IFRS Accounting Standards — Volume 11) are in issue but not yet adopted, with IFRS 18 expected to have a disclosure impact[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) [Financial Risk Factors](index=36&type=section&id=Financial%20risk%20factors) The Group is exposed to various financial risks including credit, market, currency, interest, and liquidity risks, with no significant changes in risk management policies since December 31, 2024 - The Group is exposed to credit risk, market risk, currency risk, interest risk, and liquidity risk[97](index=97&type=chunk) - No significant changes in risk management policies since December 31, 2024[98](index=98&type=chunk) [Vessels, Net (Cost and Accumulated Depreciation)](index=36&type=section&id=3.%20Vessels%2C%20net) | USD | Jan 1, 2024 | Dec 31, 2024 | June 30, 2025 | | :--- | :--- | :--- | :--- | | Vessels' cost | $1,138,221,805 | $1,138,221,805 | $1,138,221,805 | | Dry-docking and special survey costs (Cost) | $16,215,323 | $21,843,553 | $22,468,662 | | Total Cost | $1,154,437,128 | $1,160,065,358 | $1,160,690,467 | | Accumulated Depreciation (Vessels) | $(158,183,343) | $(195,677,625) | $(214,073,693) | | Accumulated Depreciation (Dry-docking) | $(8,185,605) | $(5,790,213) | $(7,948,730) | | Total Accumulated Depreciation | $(166,368,948) | $(201,467,838) | $(222,022,423) | | Net Book Value | $988,068,180 | $958,597,520 | $938,668,044 | - The charter-free market value of all vessels exceeded their carrying value as of June 30, 2025, negating the need for a recoverable amount test[100](index=100&type=chunk) [Long-Term Borrowings Summary](index=37&type=section&id=4.%20Long-Term%20borrowings) | USD | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Outstanding loan balance | $636,009,067 | $651,628,487 | | Loan financing fees | $(5,182,480) | $(6,062,278) | | Total (Net of financing fees) | $630,826,587 | $645,566,209 | | Current portion of long-term borrowings | $48,102,448 | $47,942,084 | | Long-term borrowings, net of current portion | $587,906,619 | $603,686,403 | - New **$65.0 million** secured credit facility for Nissos Kea (SOFR + **1.35%**) and **$130.0 million** facility for Nissos Nikouria and Nissos Anafi (SOFR + **1.40%**) were drawn in May/June 2025 to finance repurchases[110](index=110&type=chunk)[111](index=111&type=chunk) - The company recognized a **$1.8 million** modification gain in H1 2024 from amendments to bareboat charter agreements and a **$1.1 million** loss on debt extinguishment in H1 2025 due to refinancing[113](index=113&type=chunk) [Derivative Financial Instruments Fair Values (as of June 30, 2025)](index=41&type=section&id=5.%20Derivative%20financial%20instruments) | Instrument | Financial Position | Fair Value (USD) | | :--- | :--- | :--- | | FXSs | Current asset portion | $1,744,055 | | FXSs | Non-Current asset portion | $868,052 | | FFAs | Current Liability Portion | $(208,667) | | Total | | $2,403,440 | [Effect of Derivatives on Profit or Loss (Six months ended June 30)](index=41&type=section&id=5.%20Derivative%20financial%20instruments) | Type | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Total unrealized gain/ (loss), net on derivatives | $2,465,940 | $(443,334) | | Total realized gain/ (loss), net on derivatives | $397,168 | $(38,590) | [Related Party Balances (Kyklades Maritime Corporation)](index=41&type=section&id=6.%20Transactions%20and%20balances%20with%20related%20parties) | USD | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Balance due from/ (to) KMC | $623,462 | $(530,030) | - KMC provides technical management services for a daily fee of **$900 per vessel**[122](index=122&type=chunk) [Related Party Transactions (Six months ended June 30)](index=41&type=section&id=6.%20Transactions%20and%20balances%20with%20related%20parties) | Transaction | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Management fees to KMC | $2,280,600 | $2,293,200 | | Directors' fees | $262,007 | $225,000 | | Key management personnel remuneration | $4,129,718 | $3,973,613 | - A revised compensation policy for directors became effective June 1, 2025, adjusting the annual base fee to **$45,000** and introducing committee fees[127](index=127&type=chunk) [7. Share Capital and Additional Paid-in Capital and Dividends](index=44&type=section&id=7.%20Share%20Capital%20and%20additional%20paid-in%20capital%20and%20dividends) The company distributed **$21.6 million** in dividends during H1 2025, with **32,194,108 shares** outstanding as of August 12, 2025 - Distributed **$11.3 million** (**$0.35 per share**) in dividends in March 2025[132](index=132&type=chunk) - Distributed **$10.3 million** (**$0.32 per share**) in dividends in June 2025[132](index=132&type=chunk) - As of August 12, 2025, **32,194,108 shares** were outstanding[132](index=132&type=chunk) [Earnings Per Share (Six months ended June 30)](index=44&type=section&id=8.%20Earnings%20per%20share) | USD per Share | 2025 | 2024 | | :--- | :--- | :--- | | Profit for the period attributable to Owners | $39,442,842 | $81,122,288 | | Weighted average number of shares outstanding | 32,194,108 | 32,194,108 | | Earnings per share, basic and diluted | $1.23 | $2.52 | [Revenue Analysis by Charter Type (Six months ended June 30)](index=44&type=section&id=9.%20Revenue) | USD | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Voyage charter | $172,125,286 | $204,468,964 | $(32,343,678) | | Time charter | $1,969,500 | $18,642,019 | $(16,672,519) | | Total Revenue | $174,094,786 | $223,110,983 | $(49,016,197) | [Revenue by Continent (Six months ended June 30)](index=44&type=section&id=9.%20Revenue) | USD | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Europe | $92,258,864 | $109,045,145 | $(16,786,281) | | Asia | $64,445,219 | $71,397,326 | $(6,952,107) | | North America | $13,625,121 | $30,690,207 | $(17,065,086) | | South America | $3,765,582 | $11,978,305 | $(8,212,723) | | Total | $174,094,786 | $223,110,983 | $(49,016,197) | [10. Commitments and Contingencies](index=46&type=section&id=10.%20Commitments%20and%20contingencies) The company faces various claims and suits in the ordinary course of business but is not aware of any material contingent liabilities requiring disclosure - Various claims and suits arise in the ordinary course of shipping business, including those involving government regulations, charterer disputes, environmental claims, and supplier issues[139](index=139&type=chunk) - Management is not aware of any material claims or contingent liabilities requiring disclosure as of the reporting date[139](index=139&type=chunk) [11. Subsequent Events](index=46&type=section&id=11.%20Subsequent%20events) A dividend of **$0.70 per common share** was declared, payable on September 5, 2025, to shareholders of record as of August 22, 2025 - A dividend of **$0.70 per common share** was declared, payable on September 5, 2025, to shareholders of record as of August 22, 2025[140](index=140&type=chunk)

FORM 10-Q (Mark One) UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________________ to ___________________ Commission File Number: 001-39273 Lyra Therapeutics, Inc. (Exact Name of Registrant as Specified in its Charter) Delaw ...

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ___________ Commission File Number: 001-40305 VIRGINIA NATIONAL BANKSHARES CORPORATION (Exact Name of Registrant as Specified in its Charter) Virg ...

PART I [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents Spruce Power's unaudited condensed consolidated financial statements, detailing financial position, operations, equity changes, and cash flows, with key accounting notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $862.6 million, while negative working capital of $120.2 million resulted from reclassifying $189.8 million of non-recourse debt to current liabilities Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$862,631** | **$898,479** | | Cash and cash equivalents | $53,511 | $72,802 | | Property and equipment, net | $577,625 | $589,014 | | **Total Liabilities** | **$735,221** | **$752,327** | | Non-recourse debt, current | $215,624 | $28,310 | | Non-recourse debt, non-current | $479,424 | $677,021 | | **Total Stockholders' Equity** | **$124,987** | **$143,714** | - The company's working capital turned significantly negative to **$(120.2) million** as of June 30, 2025, from a positive **$76.9 million** at year-end 2024. This was primarily driven by the reclassification of the SP1 Facility debt to current liabilities[19](index=19&type=chunk)[36](index=36&type=chunk) [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 revenues increased 48% to $33.2 million with a narrowed net loss of $3.0 million, while six-month revenues grew 40% to $57.1 million but net loss widened to $18.3 million due to fair value changes Quarterly Results of Operations (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Revenues** | **$33,239** | **$22,481** | | Income (loss) from operations | $8,902 | $(3,360) | | Net loss attributable to stockholders | $(2,966) | $(8,578) | | Net loss per share, basic and diluted | $(0.17) | $(0.45) | Six-Month Results of Operations (in thousands, except per share data) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | **Revenues** | **$57,057** | **$40,768** | | Income (loss) from operations | $7,208 | $(6,957) | | Net loss attributable to stockholders | $(18,304) | $(11,032) | | Net loss per share, basic and diluted | $(1.01) | $(0.57) | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Total stockholders' equity decreased from $143.7 million to $125.0 million due to net loss and $1.8 million in share repurchases - Total stockholders' equity declined from **$143.7 million** on December 31, 2024, to **$125.0 million** on June 30, 2025[23](index=23&type=chunk) - During the six months ended June 30, 2025, the company repurchased **778,619 shares** for a total cost of **$1.8 million**[23](index=23&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities improved to $11.5 million for H1 2025, with overall cash, cash equivalents, and restricted cash decreasing by $18.7 million Six-Month Cash Flow Summary (in thousands) | Cash Flow Activity | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(11,467) | $(27,302) | | Net cash provided by investing activities | $8,296 | $13,487 | | Net cash used in financing activities | $(15,520) | $(8,917) | | **Net change in cash** | **$(18,691)** | **$(22,732)** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes cover the 'going concern' warning due to the SP1 Facility debt maturity, NJR acquisitions, $695.0 million in non-recourse debt, and legal settlements - The company's debt obligations under the SP1 Facility mature on April 30, 2026. These conditions, along with negative working capital and recurring net losses, raise substantial doubt about the company's ability to continue as a going concern. Management believes it can refinance this debt[35](index=35&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) - During the six months ended June 30, 2025, the company acquired **192** additional solar energy systems as part of the NJR Acquisitions for approximately **$4.5 million** in cash[84](index=84&type=chunk) - As of June 30, 2025, total non-recourse debt was **$695.0 million**, with the SP1 Facility of **$189.8 million** due in April 2026[94](index=94&type=chunk) - The company settled a class action lawsuit for **$4.75 million** in April 2025 and paid **$1.0 million** in attorney fees for another settled matter in September 2024[121](index=121&type=chunk)[122](index=122&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting 48% Q2 revenue growth, narrowed net loss, and the 'going concern' risk related to the SP1 debt facility maturity [Results of Operations](index=41&type=section&id=Results%20of%20Operations) Q2 2025 revenues rose 48% to $33.2 million with net loss narrowing to $3.0 million, while six-month revenues grew 40% to $57.1 million but net loss widened to $18.3 million due to interest rate swap changes Comparison of Three Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **$33,239** | **$22,481** | **$10,758** | **48%** | | Cost of revenues - O&M | $2,137 | $4,474 | $(2,337) | (52)% | | SG&A expenses | $15,099 | $16,701 | $(1,602) | (10)% | | **Net loss attributable to stockholders** | **$(2,966)** | **$(8,578)** | **$5,612** | **(65)%** | Comparison of Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **$57,057** | **$40,768** | **$16,289** | **40%** | | **Net loss attributable to stockholders** | **$(18,304)** | **$(11,032)** | **$(7,272)** | **66%** | - The increase in Q2 revenue was primarily due to **$3.0 million** in incremental SLA revenues and a **$5.9 million** increase in SREC revenues, largely from the NJR Acquisitions[158](index=158&type=chunk) - The wider net loss for the six-month period was primarily driven by a **$10.3 million** expense from the change in fair value of interest rate swaps in 2025, compared to a **$3.6 million** income from the same item in 2024[177](index=177&type=chunk) [Liquidity and Capital Resources](index=45&type=section&id=Liquidity%20and%20Capital%20Resources) The company had negative working capital of $120.2 million and $90.5 million in cash, with management planning to refinance the SP1 Facility to address going concern risk - The company had negative working capital of **$120.2 million** as of June 30, 2025, resulting from the current classification of the SP1 Facility debt[178](index=178&type=chunk) - Total cash, cash equivalents, and restricted cash stood at **$90.5 million** as of June 30, 2025[178](index=178&type=chunk) - Management's plans to refinance the SP1 Facility are central to alleviating the substantial doubt about the company's ability to continue as a going concern[181](index=181&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Spruce Power is exempt from providing quantitative and qualitative disclosures about market risk - As a smaller reporting company, Spruce Power is exempt from providing quantitative and qualitative disclosures about market risk[192](index=192&type=chunk) [Item 4. Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were not effective as of June 30, 2025, due to a material weakness in internal control over financial reporting, with remediation efforts underway - Management concluded that disclosure controls and procedures were not effective as of June 30, 2025, due to a material weakness in internal control over financial reporting[194](index=194&type=chunk) - The material weakness stems from deficiencies in the control environment (insufficient qualified personnel) and control activities (ineffective controls over revenue recognition)[197](index=197&type=chunk)[198](index=198&type=chunk) - A remediation plan is underway, which includes hiring qualified personnel, providing training on the COSO framework, and designing and implementing new controls related to revenue recognition[201](index=201&type=chunk)[202](index=202&type=chunk)[206](index=206&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=50&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 12 of the financial statements for a description of material pending legal proceedings, including class actions and state investigations - For details on legal proceedings, the report refers to Note 12 in the financial statements[208](index=208&type=chunk) [Item 1A. Risk Factors](index=50&type=section&id=Item%201A.%20Risk%20Factors) A key risk factor is the loss or transition of senior management, which could create uncertainty and negatively impact business operations and strategy execution - A key risk is the loss or transition of senior management, highlighted by the recent turnover of the CEO in 2024 and CFO in 2025[210](index=210&type=chunk) - Management transitions may create uncertainty, divert resources, and negatively impact the company's ability to operate effectively and execute its strategies[211](index=211&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=51&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, the company repurchased 479,667 shares for $1.0 million, with $42.0 million remaining available under the program extended to May 15, 2027 Share Repurchases for Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 388,459 | $2.10 | | May 2025 | 91,208 | $2.03 | | June 2025 | 0 | $0.00 | | **Total Q2** | **479,667** | | - As of June 30, 2025, approximately **$42.0 million** remained available under the share repurchase program[216](index=216&type=chunk) - The Board of Directors extended the Repurchase Program to expire on May 15, 2027[137](index=137&type=chunk)[215](index=215&type=chunk) [Item 3. Defaults Upon Senior Securities](index=52&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon its senior securities during the period - None[217](index=217&type=chunk) [Item 4. Mine Safety Disclosures](index=52&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[218](index=218&type=chunk) [Item 5. Other Information](index=53&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated any Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted or terminated any Rule 10b5-1 trading arrangements during the quarter[219](index=219&type=chunk) [Item 6. Exhibits](index=54&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files - The exhibits include CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, as well as Inline XBRL documents[220](index=220&type=chunk)

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the three and six months ended June 30, 2025, showing growth in total assets, loans, and deposits, with net income increasing for the six-month period compared to the prior year [Consolidated Balance Sheets (Unaudited)](index=6&type=section&id=Consolidated%20Balance%20Sheets%20(Unaudited)) As of June 30, 2025, total assets increased to $1.23 billion from $1.12 billion at year-end 2024, driven by growth in net loans and cash equivalents, while total liabilities rose to $1.08 billion, primarily due to a $97.4 million increase in deposits, and total stockholders' equity grew to $151.7 million from $140.7 million | (Dollars in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$1,232,424** | **$1,122,364** | | Total cash and cash equivalents | $143,229 | $124,122 | | Loans, net | $862,425 | $806,844 | | **Total Liabilities** | **$1,080,675** | **$981,664** | | Total deposits | $1,032,464 | $935,080 | | **Total Stockholders' Equity** | **$151,749** | **$140,700** | [Consolidated Statements of Income (Unaudited)](index=7&type=section&id=Consolidated%20Statements%20of%20Income%20(Unaudited)) For the second quarter of 2025, net income was $4.76 million, a slight increase from $4.68 million in Q2 2024, and for the six months ended June 30, 2025, net income rose to $9.23 million from $8.38 million year-over-year, supported by a significant increase in noninterest income, particularly from net interchange fees, which helped offset higher provisions for credit losses and increased noninterest expenses | (Dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net interest income | $12,388 | $11,348 | $24,282 | $22,151 | | Provision for credit losses | $1,092 | $295 | $1,813 | $315 | | Total noninterest income | $5,384 | $4,166 | $10,847 | $6,571 | | Total noninterest expense | $10,396 | $9,132 | $21,303 | $17,508 | | **Net Income** | **$4,755** | **$4,676** | **$9,225** | **$8,376** | | **Diluted EPS** | **$0.33** | **$0.36** | **$0.63** | **$0.65** | [Consolidated Statements of Comprehensive Income (Unaudited)](index=8&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)) Comprehensive income for Q2 2025 was $4.56 million, a decrease from $4.74 million in Q2 2024, primarily due to unrealized losses on available-for-sale securities, while for the six-month period, comprehensive income increased to $9.33 million from $8.43 million in the prior year | (Dollars in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income | $4,755 | $4,676 | $9,225 | $8,376 | | Other comprehensive income (loss), net of tax | ($196) | $59 | $104 | $53 | | **Comprehensive income** | **$4,559** | **$4,735** | **$9,329** | **$8,429** | [Consolidated Statements of Stockholders' Equity (Unaudited)](index=9&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Equity%20(Unaudited)) Total stockholders' equity increased from $140.7 million at December 31, 2024, to $151.7 million at June 30, 2025, primarily driven by net income of $9.2 million earned during the first six months of 2025 - Stockholders' equity grew by **$11.0 million** in the first six months of 2025, reaching **$151.7 million**, mainly due to retained earnings from net income[19](index=19&type=chunk) [Consolidated Statements of Cash Flows (Unaudited)](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) For the first six months of 2025, cash and cash equivalents increased by $19.1 million, primarily due to $98.0 million in net cash from financing activities, largely from deposit growth, which more than offset the $74.0 million used in investing activities for loan growth and securities purchases, and $4.8 million used in operating activities | (Dollars in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($4,823) | $669 | | Net cash used in investing activities | ($74,026) | ($87,218) | | Net cash provided by financing activities | $97,956 | $76,774 | | **Net increase (decrease) in cash and cash equivalents** | **$19,107** | **($9,775)** | [Notes to Consolidated Financial Statements (Unaudited)](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(Unaudited)) This section provides detailed disclosures on accounting policies and specific financial statement items, covering investment securities, loans, allowance for credit losses, deposits, subordinated debt, credit lines, and regulatory capital, offering deeper insight into the company's financial health and operations - The company's lending operations are concentrated in its local market (Nevada, California, Utah, Arizona) and nationwide through SBA and USDA loan programs[28](index=28&type=chunk) - The company operates as a single reportable segment, with the Chief Operating Decision Maker evaluating performance on a consolidated basis[25](index=25&type=chunk)[117](index=117&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance and condition, highlighting loan and deposit growth as key drivers, noting a decrease in net interest margin offset by strong growth in noninterest income, particularly from credit card interchange fees, while also covering credit quality, an increase in non-performing assets, and confirming strong liquidity and capital positions [Results of Operations](index=41&type=section&id=Results%20of%20Operations) For the first six months of 2025, net income increased to $9.2 million from $8.4 million year-over-year, driven by a 65.1% surge in noninterest income, primarily from a significant increase in net interchange fees, despite a decline in net interest margin to 4.39% from 4.83% due to a lower interest rate environment, and a 21.7% rise in noninterest expenses reflecting increased staffing, data processing, and SEC registration costs | Performance Ratios | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Return on Average Assets | 1.60% | 1.75% | | Return on Average Equity | 12.61% | 16.17% | | Net Interest Margin (annualized) | 4.39% | 4.83% | - Noninterest income for the six months ended June 30, 2025, increased by **65.1%** year-over-year, primarily driven by a **2,018.6%** increase in net interchange fees from the company's Visa Signature® Card product[153](index=153&type=chunk)[154](index=154&type=chunk) - Noninterest expense for the six months ended June 30, 2025, rose by **21.7%** compared to the same period in 2024, attributed to higher salaries from increased headcount, increased data processing costs, and non-recurring fees associated with SEC registration[158](index=158&type=chunk)[159](index=159&type=chunk)[160](index=160&type=chunk)[161](index=161&type=chunk) [Comparison of Financial Condition](index=47&type=section&id=Comparison%20of%20Financial%20Condition) Total assets grew by 10% to $1.23 billion at June 30, 2025, from year-end 2024, driven by a 7% increase in net loans to $871.6 million and a 10% increase in total deposits to $1.03 billion, while non-performing loans increased to $18.4 million, representing 2.11% of net loans, up from $14.2 million at year-end, and the allowance for credit losses remained stable at 1.1% of total loans - Total assets increased by **10%** to **$1.23 billion** at June 30, 2025, compared to **$1.12 billion** at December 31, 2024[165](index=165&type=chunk) - Total loans increased by **7%** to **$871.6 million**, and total deposits increased by **10%** to **$1.03 billion** since December 31, 2024[171](index=171&type=chunk)[191](index=191&type=chunk) | (Dollars in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total non-performing loans | $18,373 | $14,168 | | Non-performing loans to net loans | 2.11% | 1.74% | | ACL to gross loans | 1.06% | 1.12% | [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with $271.4 million in primary on-balance-sheet sources and substantial unused borrowing capacity, including $100.1 million from the FHLB and $380.1 million from the Federal Reserve's BIC Program, with robust capital levels, including the bank's Tier 1 Capital Leverage Ratio at 13.82%, significantly exceeding the 9.00% regulatory requirement under the CBLR framework - The company has significant available liquidity, with unused borrowing capacity of **$100.1 million** from the FHLB and **$380.1 million** from the Federal Reserve's BIC Program as of June 30, 2025[204](index=204&type=chunk)[205](index=205&type=chunk) - The company is well-capitalized and operates under the Community Bank Leverage Ratio (CBLR) framework, with a Bank Tier 1 Capital Leverage Ratio of **13.82%** as of June 30, 2025, well above the **9.00%** requirement[199](index=199&type=chunk)[201](index=201&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=53&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, GBank Financial Holdings Inc. is not required to provide the information for this item - The company is exempt from this disclosure requirement due to its status as a smaller reporting company[208](index=208&type=chunk) [Controls and Procedures](index=53&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the Principal Executive Officer and Principal Financial Officer, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2025, with no material changes to the company's internal control over financial reporting during the quarter - Based on an evaluation, the Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[209](index=209&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[210](index=210&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any pending legal proceedings other than routine matters occurring in the ordinary course of business, which are not expected to have a material adverse effect on its financial condition or operations - The company reports no material pending legal proceedings outside of the ordinary course of business[212](index=212&type=chunk) [Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed by the company in its Registration Statement on Form S-1 - No material changes in risk factors have occurred since the company's Registration Statement on Form S-1[213](index=213&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - None reported[214](index=214&type=chunk) [Other Information](index=55&type=section&id=Item%205.%20Other%20Information) No director or officer of the company adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the quarter ended June 30, 2025 - No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter[217](index=217&type=chunk) [Exhibits](index=56&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer - The report includes required certifications from the Principal Executive Officer and Principal Financial Officer as exhibits[219](index=219&type=chunk)