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| Part I. | | Financial Information | | 2 |
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| Item 1. | | Financial Statements | | 2 |
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| | | Consolidated Balance Sheets (Unaudited) | | 2 |
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| | | Consolidated Statements of Operations (Unaudited) | | 3 |
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| | | Consolidated Statements of Comprehensive Income (Loss) (Unaudited) | | 4 |
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| | | Consolidated Statements of Stockholders Equity (Deficit) (Unaudited) | | 5 |
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| | | Consolidated Statements of Cash Flows (Unaudited) | | 6 |
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| | | Notes to Consolidated Financial Statements (Unaudited) | | 7 |
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| Item 2. | | Management’s Discussion and Analysis of Financial Condition and Results of Operations | | 28 |
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| Item 3. | | Quantitative and Qualitative Disclosures About Market Risk | | 38 |
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| Item 4. | | Controls and Procedures | | 39 |
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| Part II. | | Other Information | | 40 |
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| Item 1. | | Legal Proceedings | | 40 |
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| Item 1A. | | Risk Factors | | 40 |
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| Item 2. | | Unregistered Sales of Equity Securities and Use of Proceeds | | 40 |
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| Item 3. | | Defaults Upon Senior Securities | | 40 |
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| Item 4. | | Mine Safety Disclosures | | 41 |
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| Item 5. | | Other Information | | 41 |
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| Item 6. | | Exhibits | | 42 |
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| Signatures | | | | 43 |
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This report, and the documents incorporated by reference herein, may contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of management. Although Resolute Holdings Management, Inc. (“Resolute Holdings”, and together with CompoSecure Holdings, L.L.C., the “Company”) believes that its plans, intentions, and expectations reflected in or suggested by these forward-looking statements are reasonable, the Company cannot assure you that it will achieve or realize these plans, intentions, or expectations. Forward-looking statements are inherently subject to risks, uncertainties, and assumptions. Generally, statements that are not historical facts, including statements concerning the Company’s possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. In some instances, these statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “will,” “should,” “seeks,” “plans,” “scheduled,” “anticipates” or “intends” or the negatives of these terms or variations of them or similar terminology.
Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements which speak only as of the date hereof. You should understand that the following important factors, among others, could affect the Company’s future results and could cause those results or other outcomes to differ materially from those expressed or implied in the Company’s forward-looking statements:
| ● | the competitive environment in which we currently or intend to operate; |
| ● | our strategy, outcomes and growth prospects; |
| ● | general economic trends and trends in the industry and markets in which we and our managed companies operate; |
| ● | our and our managed companies’ business dealings involving third-party partners in various markets; |
| ● | the risks from our entry into the CompoSecure Management Agreement (as defined herein) and management agreements with other managed companies, including risks relating to due diligence, negotiation, performance, the calculation and payment of management fees including the CompoSecure Management Fee (as defined herein) and termination; |
| ● | risks relating to our current reliance on CompoSecure Holdings L.L.C. (“CompoSecure Holdings”), including the presentation of CompoSecure Holdings’ financial information in our financial statements; |
| ● | the risk that our managed companies will fail to perform as we expect and the resulting impacts on the management fees we expect to receive; |
| ● | our ability to identify and successfully negotiate and integrate into CompoSecure Holdings or our other managed companies’ future business acquisitions and investment opportunities; |
| ● | our ability to develop and deploy the Resolute Operating System at CompoSecure Holdings and our other managed companies; |
| ● | our ability to attract and retain personnel, including key members of our management; |
| ● | the ability of CompoSecure Holdings to grow and manage growth profitably, maintain relationships with its customers, compete within its industry and retain its key employees; |
| ● | the possibility that CompoSecure Holdings may be adversely impacted by other economic, business and/or competitive factors; |
| ● | future exchange and interest rates; |
| ● | damage to our reputation; |
| ● | our ability to comply with extensive, complex and increasing legal and regulatory requirements; |
| ● | cybersecurity and privacy considerations; |
| ● | legal proceedings and investigatory risks, including the outcome of any legal proceedings that may be instituted against CompoSecure Holdings or others; |
| ● | our failure to manage the transition to a stand-alone public company; |
| ● | the impact of global economic and political developments on our business, including inflationary pressures, volatile interest rates, variable tariff policies or intensified disruptions in the global financial markets, the change in the U.S. presidential administration, the conflict in Ukraine, the conflict in Israel and Gaza, disruptions in the banking industry, economic sanctions and economic slowdowns or recessions that may result from such developments; and |
| ● | certain factors discussed elsewhere in this Quarterly Report. |
These and other factors that could cause actual results to differ from those implied by the forward-looking statements in this Quarterly Report are more fully described in the “Risk Factors” section in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC. The risks described in “Risk Factors” are not exhaustive. New risk factors emerge from time to time and it is not possible for us to predict all such risk factors, nor can the Company assess the impact of all such risk factors on its business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the foregoing cautionary statements. The Company undertakes no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
