Elme Communities

Previous wording

We refer to the three months ended June 30, 2025 and June 30, 2024 as the “2025 Quarter” and the “2024 Quarter,” respectively, and the six months ended June 30, 2025 and June 30, 2024 as the “2025 Period” and “2024 Period,” respectively.

Current wording

We refer to the three months ended September 30, 2025 and September 30, 2024 as the “2025 Quarter” and the “2024 Quarter,” respectively, and the nine months ended September 30, 2025 and September 30, 2024 as the “2025 Period” and “2024 Period,” respectively.

Previous wording

This Form 10-Q contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Such statements involve known and unknown risks, uncertainties, and other factors which may cause our actual results, performance, or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Additional factors which may cause our actual results, performance, or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements include, but are not limited to: the satisfaction or waiver of other conditions to closing the Portfolio Sale Transaction pursuant to the Purchase Agreement; the possibility that our shareholders do not approve the Portfolio Sale Transaction and/or Plan of Sale and Liquidation (together, the “Proposed Transactions”) or that other conditions to the closing of the Portfolio Sale Transaction are not satisfied or waived at all or on the anticipated timeline; unanticipated difficulties or expenditures relating to the Proposed Transactions; changes in the amount and timing of the total liquidating distributions, including as a result of unexpected levels of transaction cost, liquidation costs or unpaid or additional liabilities and obligations; the inability to close our proposed new debt financing on the terms or timeline or for the amount anticipated fees associated with the repayment of our existing indebtedness; the possibility of converting to a liquidating trust or other liquidating entity; the ability of our board of trustees to terminate the Plan of Sale and Liquidation, whether or not approved by shareholders; the response of our residents, tenants and business partners to the announcement of the Proposed Transactions; potential difficulties in employee retention as a result of announcement of the Proposed Transactions; the occurrence of any event, change or other circumstances that could give rise to the termination of the Portfolio Sale Transaction; the risk that disruptions caused by or relating to the Proposed Transactions will harm our business, including current plans and operations; risks associated with third party contracts containing consent and/or other provisions that may be triggered by the Proposed Transactions; restrictions during the …

Excerpt shortened here; the source contains the full paragraph.

Current wording

This Form 10-Q contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Such statements involve known and unknown risks, uncertainties, and other factors which may cause our actual results, performance, or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Additional factors which may cause our actual results, performance, or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements include, but are not limited to: the satisfaction or waiver of other conditions to closing the Portfolio Sale Transaction pursuant to the Purchase Agreement; the possibility that our shareholders do not approve the Portfolio Sale Transaction and/or Plan of Sale and Liquidation (together, the “Proposed Transactions”) or that other conditions to the closing of the Portfolio Sale Transaction are not satisfied or waived at all or on the anticipated timeline; the possibility that our shareholders approve one but not both of the Portfolio Sale Transaction and the Plan of Sale and Liquidation; unanticipated difficulties or expenditures relating to the Proposed Transactions; changes in the amount and timing of the total liquidating distributions, including but not limited to as a result of unexpected levels of transaction costs, unexpected additional capital or financing requirements, delayed or terminated closings, defaults under future sale agreements pursuant to the Plan of Sale and Liquidation, liquidation costs or unpaid or additional liabilities and obligations, including but not limited to tax liabilities; the inability to close our proposed new debt financing on the terms or timeline or for the amount anticipated, including the anticipated fees associated with the repayment of our existing indebtedness; the possibility of converting to a liquidating trust or other liquidating entity; the ability of our board of trustees to terminate the Plan of Sale and Liquidation, whether or not approved by shareholders; the possibility that we do not reserve adequate funds to cover expenses and liabilities, and the possibility that our creditors, in that instance, could seek repayment from our shareholders up to the amount of the total liquidating distributions; the …

Excerpt shortened here; the source contains the full paragraph.

Previous wording

Subsequent to quarter end, we entered into a Purchase Agreement dated August 1, 2025 (the “Purchase Agreement”), by and among Elme Communities, WashREIT OP LLC, a Delaware limited liability company and wholly owned subsidiary of Elme Communities (“Seller”), Echo Sub LLC, a Delaware limited liability company and wholly owned subsidiary of Seller (“Echo Sub” and together with Elme Communities and Seller, the “Company Parties”), CEVF VI Capital Holdings, LLC, a Delaware limited liability company (“Buyer”), and CEVF VI Co-Invest I Venture, LLC, a Delaware limited liability company (“Buyer Parent” and together with Buyer, the “Buyer Parties”). Pursuant to and subject to the terms and conditions of the Purchase Agreement, Buyer has agreed to purchase all of the limited liability company interests of Echo Sub in exchange for an aggregate purchase price of $1,605,560,100, subject to customary adjustments (the “Portfolio Sale Transaction”).

Current wording

On August 1, 2025, we entered into a Purchase Agreement (the “Purchase Agreement”), by and among Elme Communities, WashREIT OP LLC, a Delaware limited liability company and wholly owned subsidiary of Elme Communities (“Seller”), Echo Sub LLC, a Delaware limited liability company and wholly owned subsidiary of Seller (“Echo Sub” and together with Elme Communities and Seller, the “Company Parties”), CEVF VI Capital Holdings, LLC, a Delaware limited liability company (“Buyer”), and CEVF VI Co-Invest I Venture, LLC, a Delaware limited liability company (“Buyer Parent” and together with Buyer, the “Buyer Parties”). Pursuant to and subject to the terms and conditions of the Purchase Agreement, Buyer has agreed to purchase all of the limited liability company interests of Echo Sub in exchange for an aggregate purchase price of $1,605,560,100, subject to customary adjustments (the “Portfolio Sale Transaction”).

Previous wording

The increase in NOI is primarily due to higher NOI from same-store properties ($1.6 million), partially offset by lower NOI at Watergate 600 ($0.2 million). The higher same-store NOI was primarily due to higher rental rates. Residential same-store average occupancy for our portfolio increased to 94.7% as of June 30, 2025 from 94.5% as of June 30, 2024.

Current wording

The decrease in NOI is primarily due to lower NOI from same-store properties ($0.6 million) and Watergate 600 ($0.2 million). Residential same-store average occupancy for our portfolio decreased to 94.4% for three months ended September 30, 2025 from 95.2% for the three months ended September 30, 2024.

Previous wording

The decrease in NAREIT FFO is primarily due to higher general and administrative expenses ($1.6 million) and higher property management expenses ($0.1 million), partially offset by higher NOI ($1.3 million).

Current wording

The decrease in NAREIT FFO is primarily due to higher general and administrative expenses ($7.7 million), higher other real estate impairment ($1.7 million), and lower NOI ($0.8 million).

Previous wording

As of August 1, 2025, our Amended and Restated Revolving Credit Facility has a borrowing capacity of $306.0 million.

Current wording

As of October 21, 2025, our Amended and Restated Revolving Credit Facility has a borrowing capacity of $300.0 million.

Previous wording

As of June 30, 2025, the interest rate on the Amended and Restated Revolving Credit Facility was based on the Adjusted Daily Simple SOFR (inclusive of the 0.10% credit spread adjustment) plus 0.85% applicable margin, the daily SOFR was 4.45% and the facility fee was 0.20%.

Current wording

As of September 30, 2025, the interest rate on the Amended and Restated Revolving Credit Facility was based on the Adjusted Daily Simple SOFR (inclusive of the 0.10% credit spread adjustment) plus 0.85% applicable margin, the daily SOFR was 4.24% and the facility fee was 0.20%.

Previous wording

Residential revenue from same-store residential properties increased $2.2 million, or 3.9%, to $57.7 million for the 2025 Quarter, compared to $55.5 million for the 2024 Quarter, primarily due to higher rental income ($0.8 million), lower vacancy loss ($0.6 million), higher recoveries ($0.3 million), higher other rental and fee income ($0.3 million) and higher ancillary income ($0.3 million).

Current wording

Residential revenue from same-store residential properties increased $1.3 million, or 2.2%, to $57.7 million for the 2025 Quarter, compared to $56.4 million for the 2024 Quarter, primarily due to higher rental income ($0.7 million), higher recoveries ($0.3 million) and lower credit losses ($0.3 million).

Previous wording

The increase in same-store average occupancy was primarily due to higher average occupancy at The Ashby at McLean, Elme Cumberland, Elme Eagles Landing, Elme Druid Hills, Elme Germantown and Elme Marietta, partially offset by lower average occupancy at Elme Conyers, Clayborne Apartments, Elme Bethesda and Cascade at Landmark.

Current wording

The decrease in same-store average occupancy was primarily due to lower average occupancy at The Kenmore, Yale West, Elme Herndon, Clayborne Apartments, and The Paramount, partially offset by higher average occupancy at Elme Marietta and Elme Eagles Landing.

Previous wording

Residential expenses as a percentage of residential revenue for the 2025 Quarter and the 2024 Quarter were 36.9% and 37.2%, respectively.

Current wording

Residential expenses as a percentage of residential revenue for the 2025 Quarter and the 2024 Quarter were 39.4% and 36.9%, respectively.

Previous wording

Residential expenses from same-store residential properties increased $0.6 million, or 3.1%, to $21.2 million for the 2025 Quarter, compared to $20.6 million for the 2024 Quarter, primarily due to higher repairs and maintenance ($0.2 million), higher utilities ($0.2 million), higher personnel compensation ($0.1 million) and higher contract services ($0.1 million) expenses.

Current wording

Residential expenses from same-store residential properties increased $1.9 million, or 9.1%, to $22.6 million for the 2025 Quarter, compared to $20.8 million for the 2024 Quarter, primarily due to higher repairs and maintenance ($0.7 million), higher turnover ($0.4 million), higher personnel compensation ($0.4 million), and higher contract services ($0.3 million) expenses.

Previous wording

Real estate depreciation and amortization: Decrease of $0.3 million primarily due to in-place lease amortization at Elme Druid Hills ($0.3 million) in the 2024 Quarter.

Current wording

Real estate depreciation and amortization: Increase of $0.3 million primarily due to expensing previously capitalized costs during the 2025 Quarter.

Previous wording

•Line of credit: Decrease primarily due to a lower weighted average interest rate of 5.3% in the 2025 Quarter, as compared to a weighted average interest rate of 6.3% in the 2024 Quarter, partially offset by a higher weighted average borrowings of $179.6 million in the 2025 Quarter, as compared to weighted average borrowings of $161.5 million in the 2024 Quarter.

Current wording

•Line of credit: Decrease primarily due to a lower weighted average interest rate of 5.4% in the 2025 Quarter, as compared to a weighted average interest rate of 6.3% in the 2024 Quarter, partially offset by a higher weighted average borrowings of $186.0 million in the 2025 Quarter, as compared to weighted average borrowings of $168.8 million in the 2024 Quarter.

Previous wording

Real estate rental revenue from same-store residential properties increased $4.3 million, or 3.9%, to $114.7 million for the 2025 Period, compared to $110.4 million for the 2024 Period, primarily due to higher rental income ($1.7 million), lower vacancy loss ($1.0 million), higher ancillary income ($0.5 million), lower credit losses ($0.5 million), higher recoveries ($0.3 million) and higher other rental and fee income ($0.3 million).

Current wording

Real estate rental revenue from same-store residential properties increased $5.6 million, or 3.3%, to $172.4 million for the 2025 Period, compared to $166.8 million for the 2024 Period, primarily due to higher rental income ($2.5 million), lower vacancy loss ($0.9 million), lower credit losses ($0.8 million), higher ancillary income ($0.7 million), and higher recoveries ($0.6 million).

Previous wording

The increase in same-store average occupancy was primarily due to higher average occupancy at Elme Marietta, The Ashby at McLean and Park Adams, partially offset by lower average occupancy at Elme Conyers, Elme Bethesda and Cascade at Landmark.

Current wording

Same-store average occupancy remained consistent at 94.6% in the 2025 Period and the 2024 Period. Higher average occupancy at The Ashby at McLean, Elme Cumberland, Elme Eagles Landing and Elme Marietta was partially offset by lower average occupancy at Elme Conyers, The Kenmore and Yale West.

Previous wording

Residential real estate expenses as a percentage of residential revenue for the 2025 Period and 2024 Period were 36.5% and 37.1%, respectively.

Current wording

Residential real estate expenses as a percentage of residential revenue for the 2025 Period and 2024 Period were 37.5% and 37.1%, respectively.

Previous wording

Real estate expenses from same-store residential properties increased by $0.9 million, or 2.2%, to $41.7 million for the 2025 Period, compared to $40.9 million for the 2024 Period, primarily due to higher repairs and maintenance ($0.4 million), higher utilities ($0.3 million), higher administrative ($0.3 million), higher contract services ($0.2 million) and higher insurance ($0.1 million) expenses. The increase is partially offset by lower real estate taxes ($0.4 million).

Current wording

Real estate expenses from same-store residential properties increased by $2.8 million, or 4.5%, to $64.4 million for the 2025 Period, compared to $61.6 million for the 2024 Period, primarily due to higher repairs and maintenance ($1.2 million), higher personnel compensation ($0.5 million), higher administrative ($0.5 million), higher contract services ($0.4 million), higher utilities ($0.3 million), higher turnover ($0.3 million) and higher insurance ($0.2 million) expenses. The increase is partially offset by lower real estate taxes ($0.6 million).

Previous wording

Other NOI decreased $0.4 million due to lower rental revenue ($0.3 million) and higher operating expenses ($0.1 million) at Watergate 600.

Current wording

Other NOI decreased $0.6 million due to lower rental revenue ($0.5 million) and higher operating expenses ($0.1 million) at Watergate 600.

Previous wording

General and administrative expenses: Increase of $1.6 million primarily due to higher professional fees ($0.8 million) in connection with activities related to the board of trustee’s ongoing strategic alternatives review and higher incentive compensation ($1.0 million), partially offset by lower marketing expenses ($0.1 million) and higher internal management fee offset ($0.1 million).

Current wording

General and administrative expenses: Increase of $12.3 million primarily due to higher professional fees ($10.0 million) in connection with activities related to the Proposed Transactions, higher incentive compensation ($1.8 million), and prepaid equity offering write-off ($0.9 million), partially offset by higher internal management fee offset ($0.2 million).

Previous wording

Real estate depreciation and amortization: Decrease of $2.0 million primarily due to in-place lease amortization at Elme Druid Hills ($2.1 million) in the 2024 Period.

Current wording

Real estate depreciation and amortization: Decrease of $1.7 million primarily due to in-place lease amortization at Elme Druid Hills ($2.1 million) in the 2024 Period and lower other amortization ($0.2 million), partially offset by higher depreciation ($0.5 million).

Previous wording

Interest expense: Interest expense by debt type for the six months ended June 30, 2025 and 2024 was as follows (in thousands):

Current wording

Interest expense: Interest expense by debt type for the nine months ended September 30, 2025 and 2024 was as follows (in thousands):

Previous wording

•Line of credit: Decrease primarily due to a lower weighted average interest rate of 5.3% in the 2025 Period, as compared to a weighted average interest rate of 6.3% in the 2024 Period, partially offset by a higher weighted average borrowings of $181.6 million in the 2025 Period, as compared to weighted average borrowings of $164.9 million in the 2024 Period.

Current wording

•Line of credit: Decrease primarily due to a lower weighted average interest rate of 5.4% in the 2025 Period, as compared to a weighted average interest rate of 6.3% in the 2024 Period, partially offset by a higher weighted average borrowings of $183.1 million in the 2025 Period, as compared to weighted average borrowings of $166.2 million in the 2024 Period.

Previous wording

Subsequent to quarter end, our board of trustees approved the Plan of Sale and Liquidation and the Portfolio Sale Transaction, and, on August 1, 2025, we entered into the Purchase Agreement. If the Portfolio Sale Transaction and Plan of Sale and Liquidation are approved by our shareholders, we expect it will materially impact our short and long-term capital needs and our plan to meet those needs. As of June 30, 2025, whether the Proposed Transactions are approved by our shareholders, and the Portfolio Sale Transaction is consummated, we believe we will have adequate liquidity over the next twelve months to operate our business and to meet our cash requirements, including meeting our debt obligations, capital and contractual obligations, as well as the payment of dividends.

Current wording

Our board of trustees approved the Proposed Transactions, and, on August 1, 2025, we entered into the Purchase Agreement. If the Proposed Transactionsare approved by our shareholders, we expect it will materially impact our short and long-term capital needs and our plan to meet those needs. As of September 30, 2025, whether the Proposed Transactions are approved by our shareholders, and the Portfolio Sale Transaction is consummated, we believe we will have adequate liquidity over the next twelve months to operate our business and to meet our cash requirements, including meeting our debt obligations, capital and contractual obligations, as well as the payment of dividends.

Previous wording

If the Proposed Transactions are not approved by our shareholders, we believe we would have adequate liquidity beyond 2025 and would have no debt maturities until 2026 and only $350.0 million of scheduled debt maturities prior to 2029, based on current amounts outstanding under our Amended and Restated Revolving Credit Facility. As of August 1, 2025, we had cash and cash equivalents totaling $6.2 million and a borrowing capacity of $306.0 million on our Amended and Restated Revolving Credit Facility, resulting in a total liquidity position of $312.2 million. Concurrently with the consummation of the Portfolio Sale Transaction, we intend to repay all of the amounts outstanding under our Amended and Restated Revolving Credit Facility, our 2023 Term Loan, our 30-Year Unsecured Notes due 2028 and our 10-year notes due 2030, and to enter into the Loan to provide liquidity while we complete the sale of our remaining assets, which we are aiming to complete in the next 12 months, and our winddown (subject to shareholder approval of the Plan of Sale and Liquidation).

Current wording

If the Proposed Transactions are not approved by our shareholders, we believe we would have adequate liquidity beyond 2025 and would have no debt maturities until 2026 and only $361.0 million of scheduled debt maturities prior to 2029, based on current amounts outstanding under our Amended and Restated Revolving Credit Facility. As of October 21, 2025, we had cash and cash equivalents totaling $2.2 million and a borrowing capacity of $300.0 million on our Amended and Restated Revolving Credit Facility, resulting in a total liquidity position of $302.2 million. Concurrently with the consummation of the Portfolio Sale Transaction, we intend to repay all of the amounts outstanding under our Amended and Restated Revolving Credit Facility, our 2023 Term Loan, our 30-Year Unsecured Notes due 2028 and our 10-year notes due 2030, and to enter into the Loan to provide liquidity while we complete the sale of our remaining assets, which we are aiming to complete in the next 12 months, and our winddown (subject to shareholder approval of the Plan of Sale and Liquidation).

Previous wording

•Approximately $29.0 - $34.0 million to invest in our existing portfolio of operating assets, inclusive of $15.0 - $20.0 million of major capital expenditures.

Current wording

•Approximately $28.0 - $33.0 million to invest in our existing portfolio of operating assets, inclusive of $14.0 - $18.0 million of major capital expenditures.

Previous wording

There can be no assurance that our capital requirements will not be materially higher or lower than the above expectations. We currently believe that we will generate sufficient cash flow from operations and potential property sales, including the Portfolio Sale Transaction, and have access to the capital resources necessary to fund our requirements for the remainder of 2025. However, as a result of the uncertainty of the general market conditions in the greater Washington, DC metro and Sunbelt regions, economic conditions affecting the ability to attract and retain residents and tenants or achieve anticipated rental rates, declines in our share price, unfavorable changes in the supply of competing properties, the effects of our announced Portfolio Sale Transaction and Plan of Sale and Liquidation, if the Loan we expect to receive if we consummate the Portfolio Sale Transaction is not available on the amounts anticipated or our properties not performing as expected, we may not generate sufficient cash flow from operations and property sales or otherwise have access to capital on favorable terms, or at all. If we are unable to obtain capital from other sources, we may need to alter capital spending to be materially different than what is stated above. If capital were not available, we may be unable to satisfy the distribution requirement applicable to REITs, make required principal and interest payments or make necessary and/or routine capital improvements.

Current wording

There can be no assurance that our capital requirements will not be materially higher or lower than the above expectations. We currently believe that we will generate sufficient cash flow from operations and potential property sales, including the Portfolio Sale Transaction, and have access to the capital resources necessary to fund our requirements for the remainder of 2025. However, as a result of the uncertainty of the general market conditions in the greater Washington, DC metro and Sunbelt regions, economic conditions affecting the ability to attract and retain residents and tenants or achieve anticipated rental rates, declines in our share price, unfavorable changes in the supply of competing properties, the effects of our announced Portfolio Sale Transaction and Plan of Sale and Liquidation, if the Loan we expect to receive if we consummate the Portfolio Sale Transaction is not available on the timing or for the amounts anticipated or our properties not performing as expected, we may not generate sufficient cash flow from operations and property sales or otherwise have access to capital on favorable terms, or at all. If we are unable to obtain capital from other sources, we may need to alter capital spending to be materially different than what is stated above. If capital were not available, we may be unable to satisfy the distribution requirement applicable to REITs, make required principal and interest payments or make necessary and/or routine capital improvements.

Previous wording

As of June 30, 2025, the weighted average maturity for our debt is 3.8 years. If principal amounts due at maturity cannot be refinanced, extended or paid with proceeds of other capital transactions, such as new equity capital, our cash flow may be insufficient to repay all maturing debt. Prevailing interest rates or other factors at the time of a refinancing, such as possible reluctance of lenders to make commercial real estate loans, may result in higher interest rates and increased interest expense or inhibit our ability to finance our obligations.

Current wording

As of September 30, 2025, the weighted average maturity for our debt is 3.6 years. If principal amounts due at maturity cannot be refinanced, extended or paid with proceeds of other capital transactions, such as new equity capital, our cash flow may be insufficient to repay all maturing debt. Prevailing interest rates or other factors at the time of a refinancing, such as possible reluctance of lenders to make commercial real estate loans, may result in higher interest rates and increased interest expense or inhibit our ability to finance our obligations.

Previous wording

We have a dividend reinvestment program whereby shareholders may use their dividends and optional cash payments to purchase common shares. The common shares sold under this program may either be common shares issued by us or common shares purchased in the open market. We intend to use the proceeds of the sale of any newly issued common shares issued under this program, if any, for general corporate purposes.

Current wording

We have a dividend reinvestment program whereby shareholders may use their dividends and optional cash payments to purchase common shares. The common shares sold under this program may either be common shares issued by us or common shares purchased in the open market. We intend to use the proceeds of the sale of any newly issued common shares issued under this program, if any, for general corporate purposes. In September 2025, the Company suspended its dividend reinvestment program. During the suspension period, dividend payments are not automatically reinvested in additional shares of our common shares of beneficial interest and participants in the dividend reinvestment program are not able to purchase shares of our common shares of beneficial interest through optional cash investments under the dividend reinvestment program.

Previous wording

Net cash used in financing activities increased primarily due to payment of financing costs during the 2025 Period.

Current wording

Net cash used in financing activities decreased primarily due to lower payment of financing costs during the 2025 Period.

Previous wording

The following table provides the calculation of our NAREIT FFO and a reconciliation of net loss to NAREIT FFO for the three and six months ended June 30, 2025 and 2024 (in thousands):

Current wording

The following table provides the calculation of our NAREIT FFO and a reconciliation of net loss to NAREIT FFO for the three and nine months ended September 30, 2025 and 2024 (in thousands):

Previous wording

We base the discussion and analysis of our financial condition and results of operations upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. There were no changes made by management to the critical accounting policies in the three and six months ended June 30, 2025. We discuss the most critical estimates in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 14, 2025.

Current wording

We base the discussion and analysis of our financial condition and results of operations upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. There were no changes made by management to the critical accounting policies in the three and nine months ended September 30, 2025. We discuss the most critical estimates in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 14, 2025.