Falcon's Beyond Global, Inc.

Previous wording

The following discussion and analysis of financial condition and results of operations of the Company is provided to supplement the unaudited condensed consolidated financial statements and the accompanying notes of the Company as of and for the three and six months ended June 30, 2025, and 2024, included elsewhere in this Quarterly Report. We intend for this discussion to provide the reader with information to assist in understanding the Company’s unaudited condensed consolidated financial statements and the accompanying notes, the changes in those financial statements and the accompanying notes from period to period along with the primary factors that accounted for those changes. Certain information contained in this management’s discussion and analysis includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. Please see “Cautionary Note Regarding Forward-Looking Statements,” in this Quarterly Report.

Current wording

The following discussion and analysis of financial condition and results of operations of the Company is provided to supplement the unaudited condensed consolidated financial statements and the accompanying notes of the Company as of and for the three and nine months ended September 30, 2025, and 2024, included elsewhere in this Quarterly Report. We intend for this discussion to provide the reader with information to assist in understanding the Company’s unaudited condensed consolidated financial statements and the accompanying notes, the changes in those financial statements and the accompanying notes from period to period along with the primary factors that accounted for those changes. Certain information contained in this management’s discussion and analysis includes forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. Please see “Cautionary Note Regarding Forward-Looking Statements,” in this Quarterly Report.

Previous wording

The following reflects our results of operations for the three and six months ended June 30, 2025 and 2024.

Current wording

The following reflects our results of operations for the three and nine months ended September 30, 2025 and 2024.

Previous wording

The Company has been engaged in expanding its operations through its equity method investments, developing new product offerings, raising capital and recruiting personnel. The Company has incurred a loss from operations, an accumulated deficit and negative cash flows from operating activities for the six months ended June 30, 2025. Accordingly, the Company performed an evaluation of its ability to continue as a going concern through at least twelve months from the date of the issuance of the interim unaudited condensed consolidated financial statements.

Current wording

The Company has been engaged in expanding its operations through its equity method investments, developing new product offerings, raising capital and recruiting personnel. The Company has incurred a loss from operations, and negative cash flows from operating activities, as it has invested in growing the Falcon's Beyond Brands division and the newly acquired OES business, for the nine months ended September 30, 2025. Accordingly, the Company performed an evaluation of its ability to continue as a going concern through at least twelve months from the date of the issuance of the interim unaudited condensed consolidated financial statements.

Previous wording

The Company’s development plans, and investments have been funded by a combination of debt and committed equity contributions from its stockholders, and distributions from the sale of non-core assets from its equity method investments. The Company is reliant upon its stockholders, and third parties for obtaining additional financing through debt or equity raises, and from distributions from equity method investments, to fund its working capital needs, contractual commitments, and expansion plans. As of June 30, 2025, the Company has accrued material amounts of expenses in relation to its external advisors, accountants and legal costs in relation to the Business Combination. As of June 30, 2025, the Company has a working capital deficiency of $27.4 million including $8.5 million debt that matured on May 16, 2025 and debt coming due of $0.4 million.

Current wording

The Company’s development plans, and investments have been funded by a combination of debt and equity investments from its stockholders, and distributions from the sale of non-core assets from its equity method investments. The Company is reliant upon its stockholders, and third parties for obtaining additional financing through debt or equity raises, and from distributions from equity method investments, to fund its working capital needs, contractual commitments, and expansion plans. As of September 30, 2025, the Company continues to carry material accrued expenses and accounts payable in relation to its external advisors fees for the 2023 Business Combination. As of September 30, 2025, the Company has a working capital deficiency of $27.0 million including $8.2 million debt that matured on May 16, 2025 and debt coming due of $1.9 million.

Previous wording

The Company does not currently have sufficient cash or liquidity to pay liabilities that are owed or are maturing at this time and to fund ongoing operations. There can be no assurance that additional capital or financing raises, if completed, will provide the necessary funding for the next twelve months from the date of this Quarterly Report. This Quarterly Report does not reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

Current wording

The Company does not currently have sufficient cash or liquidity to pay all liabilities that are owed or are maturing in the next twelve months and fund ongoing operations. There can be no assurance that additional capital or financing raises, or liquidation of non-core assets and investments, if completed, will provide the necessary funding for the next twelve months from the date of this Quarterly Report. This Quarterly Report does not reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

Previous wording

Revenue increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by new attractions contracts.

Current wording

Revenue increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, primarily driven by new attractions contracts.

Previous wording

Project design and build expense increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by new attractions sales and service contracts.

Current wording

Project design and build expense increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, primarily driven by new attractions sales and service contracts.

Previous wording

Selling, general and administrative expense increased for the six months ended June 30, 2025, compared to the same period in 2024, primarily driven by a $1.9 million increase in payroll, payroll taxes, and benefits for the expansion of the attraction services business, a $1.3 million increase in office and administrative expenses and a $0.2 million increase in royalty expense primarily driven by the development of a location based entertainment experience. The decrease was partially offset by a $2.6 million decrease in audit and professional services fees.

Current wording

Selling, general and administrative expense increased for the three months ended September 30, 2025, compared to the same period in 2024, primarily driven by a $2.1 million increase in payroll, payroll taxes, and benefits, professional fees, occupancy costs and marketing to support the expansion of the attraction services business. The increase was partially offset by $0.6 million credit in full settlement of a claim against a third party network service provider to recover expenses related to a network intrusion.

Previous wording

Selling, general and administrative expense increased for the three months ended June 30, 2025, compared to the same period in 2024, primarily driven by a $1.0 million increase in payroll, payroll taxes, and benefits to support the expansion of the attraction services business, a $0.8 million increase in office and administrative expenses and a $0.2 million increase in royalty expense primarily driven by the development of a location based entertainment experience. The increase was partially offset by a $0.7 million decrease in audit and professional services fees.

Current wording

Selling, general and administrative expense increased for the nine months ended September 30, 2025, compared to the same period in 2024, primarily driven by a $5.2 million increase in payroll, payroll taxes, and benefits, professional fees, occupancy costs and marketing to support the expansion of the attraction services business. The decrease was partially offset by a $2.3 million decrease in audit and professional services fees and by a $0.6 million credit in full settlement of a claim against a third party network service provider to recover expenses related to a network intrusion.

Previous wording

The Company recognized a transaction credit of $3.5 million for the six months ended June 30, 2025 as a result of a transaction expense settlement. The transaction credit was partially offset by $1.7 million transaction expenses for the six months ended June 30, 2025 related to a proposed underwritten offering of the Company's Class A common stock during the first quarter in 2025 that was not completed.

Current wording

The Company recognized a transaction credit of $3.5 million for the nine months ended September 30, 2025 as a result of a transaction expense settlement. The transaction credit was partially offset by $1.7 million transaction expenses for the nine months ended September 30, 2025 related to a proposed underwritten offering of the Company's Class A common stock during the first quarter in 2025 that was not completed.

Previous wording

Research and development increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by the development of a location based entertainment experience.

Current wording

Research and development increased for the nine months ended September 30, 2025, compared to the same periods in 2024, primarily driven by the development of a location based entertainment experience.

Previous wording

Depreciation and amortization expense increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by the OES Acquisition. See “Note 3 - Acquisition” within Item 1 of this Quarterly Report.

Current wording

Depreciation and amortization expense increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, primarily driven by the OES Acquisition. See “Note 3 – Business combination” within Item 1 of this Quarterly Report.

Previous wording

Share of gain from equity method investments increased for the three and six months ended June 30, 2025, compared to the same periods in 2024 was primarily driven by:

Current wording

Share of (loss) gain from equity method investments increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024 was primarily driven by:

Previous wording

PDP: Share of net income from PDP increased for the three and six months ended June 30, 2025, compared to the same periods in 2024. On May 30, 2025, PDP sold all the shares of Tertian XXI, S.L., ("Tertian") a wholly-owned subsidiary of PDP, which owned the real estate assets comprising the resort hotel at Tenerife, the ("Tenerife Sale"). The Company received $27.0 million in a cash dividend distribution from PDP as a result of the transaction. PDP recognized a pre tax gain on sale of $59.5 million. The Company recognized its 50% share of the gain of $29.8 million within the Share of gain from equity method investments.

Current wording

Share of net income from PDP increased for the nine months ended September 30, 2025, compared to the same periods in 2024. On May 30, 2025, PDP sold all the shares of Tertian XXI, S.L., ("Tertian") a wholly-owned subsidiary of PDP, which owned the real estate assets comprising the resort hotel at Tenerife, the ("Tenerife Sale"). The Company received $27.0 million in a cash dividend distribution from PDP as a result of the transaction. PDP recognized a pre tax gain on sale of $60.0 million. The Company recognized its 50% share of the gain of $30.0 million within the share of (loss) gain from equity method investments.

Previous wording

The fair value of the Company’s remaining investment in PDP, which operates one hotel resort and theme park located in Mallorca, Spain, was determined to be $27.1 million. As of June 30, 2025, the Company recognized an other-than-temporary impairment charge of $5.3 million, which is recorded in Share of gain from equity method investments.

Current wording

The fair value of the Company’s remaining investment in PDP, which operates one hotel resort and theme park located in Mallorca, Spain, was determined to be below the recorded value. As of June 30, 2025, the Company recognized an other-than-temporary impairment charge of $5.3 million, which is recorded in share of (loss) gain from equity method investments.

Previous wording

Interest expense increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by the increase in outstanding debt and interest rates on both short and long-term debt.

Current wording

Interest expense increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, primarily driven by the increase in interest rates on both short and long-term debt.

Previous wording

Gain due to change in fair value of warrant liabilities increased for the six months ended June 30, 2025, compared to the same period in 2024, primarily driven by the decrease in the market value of the warrants through January 14, 2025. As of March 31, 2025, all warrants have been reclassified to equity and will not require subsequent fair value measurement. See Note 16 – Stock warrants in the Company’s unaudited condensed consolidated financial statements.

Current wording

Gain due to change in fair value of warrant liabilities increased for the nine months ended September 30, 2025, compared to the same period in 2024, primarily driven by the decrease in the market value of the warrants through January 14, 2025. As of March 31, 2025, all warrants have been reclassified to equity and will not require subsequent fair value measurement. See "Note 18 – Stock warrants" in the Company’s unaudited condensed consolidated financial statements.

Previous wording

As of June 30, 2025, all EBITDA and revenue based earnout shares have been earned or forfeited. The remaining earnout shares based on Company stock price targets were reclassified to equity and do not require subsequent fair value measurement. As a result, there was no change in fair value of earnout liabilities incurred for the three and six months ended June 30, 2025.

Current wording

As of September 30, 2025, all EBITDA and revenue based earnout shares have been earned or forfeited. The remaining earnout shares based on Company stock price targets were reclassified to equity and do not require subsequent fair value measurement. As a result, there was no change in fair value of earnout liabilities incurred for the three and nine months ended September 30, 2025.

Previous wording

Gain due to change in fair value of earnout liability was for the three and six months ended June 30, 2024, primarily driven by a decrease in the market price of the Company’s stock between December 31, 2023 and June 30, 2024.

Current wording

Gain due to change in fair value of earnout liability was for the three and nine months ended September 30, 2024, primarily driven by a decrease in the market price of the Company’s stock between December 31, 2023 and September 30, 2024.

Previous wording

Foreign exchange transaction gain increased for the three and six months ended June 30, 2025, compared to the same periods in 2024. The increase is primarily attributable to the unrealized foreign exchange gain on U.S. denominated related party debt with a Spanish subsidiary as the U.S. dollar weakened against the Euro during the three and six months ended June 30, 2025 and strengthened against the Euro during the three and six months ended June 30, 2024.

Current wording

Foreign exchange transaction gain increased for the nine months ended September 30, 2025, compared to the same periods in 2024. The change is primarily attributable to the foreign exchange gain on U.S. denominated intercompany party debt with a Spanish subsidiary as the U.S. dollar weakened against the Euro during the nine months ended September 30, 2025, and strengthened against the Euro during the nine months ended September 30, 2024.

Previous wording

FCG segment income decreased for the six months ended June 30, 2025, compared to the same periods in 2024, primarily as a result of a decrease in revenues and a decrease in margins on certain current long-term contracts. FCG's net income (loss) was adjusted for accretion of preference dividend and fees, and amortization of basis difference as follows:

Current wording

FCG segment income decreased for the nine months ended September 30, 2025, compared to the same periods in 2024, primarily as a result of a decrease in revenues and a decrease in margins on certain current long-term contracts. FCG's net income (loss) was adjusted for accretion of preference dividend and fees, and amortization of basis difference as follows:

Previous wording

FCG revenues decreased for the three and six months ended June 30, 2025, compared to the same periods in 2024, as a result of the timing of certain contract performance obligations.

Current wording

FCG revenues decreased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, as a result of the timing of certain contract performance obligations.

Previous wording

FCG project design and build expense decreased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by the decrease in project revenues partially offset by a decline in project gross margins on certain design projects.

Current wording

FCG project design and build expense decreased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, primarily driven by the decrease in project revenues partially offset by a decline in project gross margins on certain design projects.

Previous wording

Destinations Operations segment loss from operations decreased for the three and six months ended June 30, 2025, compared to the same periods in 2024, primarily driven by decreased shared services allocations.

Current wording

Destinations Operations segment income (loss) from operations increased (decreased) for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024, primarily driven by decreased shared services allocations.

Previous wording

PDP's share segment income increased for the three and six months ended June 30, 2025, compared to the same periods in 2024, as a result of the Tenerife Sale partially offset by the impairment of PDP. See “Note 5 - Investments and advances to equity method investments” within Item 1 of this Quarterly Report.

Current wording

PDP's share segment income increased for the three and nine months ended September 30, 2025, compared to the same periods in 2024, as a result of the Tenerife Sale partially offset by the impairment of PDP. See “Note 5 – Investments and advances to equity method investments” within Item 1 of this Quarterly Report.

Previous wording

FBB segment loss from operations increased for the three and six months ended June 30, 2025 compared to the same periods in 2024, primarily driven by an increase in payroll and selling, general and administrative costs related costs to develop the Attraction systems business, partially offset by increases in revenue net of project design and build expenses, from new attractions service contracts.

Current wording

FBB segment loss from operations increased for the three and nine months ended September 30, 2025 compared to the same periods in 2024, primarily driven by an increase in payroll and selling, general and administrative costs related costs to develop the Falcon's Attractions business, partially offset by increases in revenue net of project design and build expenses, from new attractions service contracts.

Previous wording

We prepare our unaudited condensed consolidated financial statements in accordance with U.S. GAAP. In addition to disclosing financial results prepared in accordance with U.S. GAAP, we disclose information regarding Adjusted EBITDA which is a non-GAAP measure. We define Adjusted EBITDA as net income, determined in accordance with U.S. GAAP, for the period presented, before net interest and expense, income tax expense, depreciation and amortization, transaction (credit) expenses related to the business combination, credit loss expense related to the closure of the Sierra Parima Katmandu Park, share of equity method investee’s gain on Tenerife Sale, impairment of PDP, change in fair value of warrant liabilities and change in fair value of earnout liabilities.

Current wording

We prepare our unaudited condensed consolidated financial statements in accordance with U.S. GAAP. In addition to disclosing financial results prepared in accordance with U.S. GAAP, we disclose information regarding Adjusted EBITDA which is a non-GAAP measure. We define Adjusted EBITDA as net income, determined in accordance with U.S. GAAP, for the period presented, before net interest and expense, income tax expense, depreciation and amortization, transaction (credit) expenses related to the business combination, credit loss expense related to the closure of the Sierra Parima Katmandu Park, share of equity method investee’s gain on Tenerife Sale, impairment of PDP, impairment of Karnival, change in fair value of warrant liabilities, change in fair value of earnout liabilities and gain on bargain purchase of OES Acquisition.

Previous wording

Adjusted EBITDA loss increased for the six months ended June 30, 2025, compared to the same period in 2024, primarily driven by a $0.6 million increase in losses from operations, a $5.5 million decrease in share of gain from equity method investments, partially offset by an increase of $2.7 million in foreign exchange transaction gain.

Current wording

Adjusted EBITDA loss increased for the three months ended September 30, 2025, compared to the same period in 2024, primarily driven by a $1.1 million increase in losses from operations from the integration of the OES acquisition, a $4.0 million decrease in the share of (loss) gain from equity method investments and a decrease of $0.9 million in foreign exchange transaction gain.

Previous wording

Adjusted EBITDA loss decreased for the three months ended June 30, 2025, compared to the same period in 2024, primarily driven by an increase of $1.6 million in foreign exchange transaction gain, partially offset by a decrease of $0.3 million in the share of gain from equity method investments, and an increase of $1.1 million in losses from operations from the integration of the OES acquisition.

Current wording

Adjusted EBITDA loss increased for the nine months ended September 30, 2025, compared to the same period in 2024, primarily driven by a $0.7 million increase in losses from operations from the integration of the OES acquisition, a $9.7 million decrease in share of gain from equity method investments, partially offset by an increase of $1.8 million in foreign exchange transaction gain.

Previous wording

The following table sets forth reconciliations of net income (loss) for FCG under U.S. GAAP to Adjusted EBITDA for the following periods:

Current wording

The following table sets forth reconciliations of net (loss) income for FCG under U.S. GAAP to Adjusted EBITDA for the following periods:

Previous wording

Adjusted EBITDA decreased for the six months ended June 30, 2025, compared to the same period in 2024, primarily driven by a decrease in revenues of $12.1 million; partially offset by a decrease in project design and build expenses of $7.0 million. As of June 30, 2025, the contracted pipeline for FCG was $47.2 million.

Current wording

Adjusted EBITDA decreased for the nine months ended September 30, 2025, compared to the same period in 2024, primarily driven by a decrease in revenues of $19.5 million; partially offset by a decrease in project design and build expenses of $10.5 million and a decrease in selling, general and administrative expense of $1.1 million. As of September 30, 2025, the contracted pipeline for FCG was $48.3 million.

Previous wording

As of June 30, 2025, our total indebtedness was approximately $40.6 million. We had approximately $26.1 million of cash and $1.0 million available for borrowing under our lines of credit.

Current wording

As of September 30, 2025, our total indebtedness was approximately $16.1 million. We had approximately $4.3 million of cash and cash equivalents and $10.0 million available for borrowing under our lines of credit. On November 10, 2025 we entered into a new $15.0 million line of credit agreement and amended our existing line of credit agreement to reduce the borrowing capacity to $5.5 million. Collectively, these agreements increasing cash available for borrowing by $5.5 million.

Previous wording

We anticipate managing our operations to ensure that our existing cash on hand and unused capacity on our existing lines of credit, along with distributions from equity method investees, additional debt and equity capital raises, and reviewing our portfolio of assets to provide additional liquidity over the next twelve months to meet our short-term needs. Currently, we do not have sufficient cash from operations and unused capacity to meet the next twelve months of our operations.

Current wording

We anticipate managing our operations to ensure that our existing cash on hand and unused capacity on our lines of credit, along with distributions from equity method investees, additional debt and equity capital raises, and reviewing our portfolio of assets to provide additional liquidity over the next twelve months to meet our short-term needs. Currently, we do not have sufficient cash from operations and unused capacity to settle our outstanding liabilities and meet the needs of our next twelve months of our operations.

Previous wording

For the six months ended June 30, 2025, we have operational losses, accumulated deficits and negative cash flows from operating activities that raise substantial doubt about our ability to continue as a going concern. As of June 30, 2025, we have $35.0 million of accrued expenses and other current liabilities and short term advances, which include $18.6 million of transaction and other related professional fees, $8.0 million short term advances, $2.4 million of excise tax payable on FAST II stock redemptions, $2.6 million of accrued payroll and related expenses, and approximately $3.4 million of other accrued expenses and current liabilities. The transaction expenses are actively being negotiated, and actual settlement may vary from the amounts recorded. Additionally, as of June 30, 2025, we have unfunded commitments to Karnival of $2.4 million (HKD 18.7 million), to be used for the purpose of constructing the Vquarium Entertainment Centers in Hong Kong.

Current wording

For the nine months ended September 30, 2025, we have operational losses, and negative cash flows from operating activities that raise substantial doubt about our ability to continue as a going concern. As of September 30, 2025, we have $21.1 million of accrued expenses and other current liabilities, which include $16.0 million of transaction and other related professional fees, $2.1 million of accrued payroll and related expenses, $2.0 million accrued interest and approximately $1.0 million of other accrued expenses and current liabilities. The transaction expenses are actively being negotiated, and actual settlement may vary from the amounts recorded.

Previous wording

Pursuant to the Business Combination during the year ended December 31, 2023, the Company received net cash proceeds from the Business Combination totaling $0.9 million, net of $1.3 million of FAST II transaction costs and $1.6 million of Falcon’s Opco transaction costs paid at Closing. FAST II and Falcon’s Opco transaction costs related to the Business Combination of $6.3 million and $12.2 million, respectively, are not yet settled as of June 30, 2025, and the Company is actively negotiating to settle them over the next 24 months. These transaction costs are recorded in accrued expenses. Negotiations regarding the terms of the costs yet to be settled are still ongoing and may change materially from these amounts accrued.

Current wording

Pursuant to the Business Combination during the year ended December 31, 2023, the Company received net cash proceeds from the Business Combination totaling $0.9 million, net of $1.3 million of FAST II transaction costs and $1.6 million of Falcon’s Opco transaction costs paid at Closing. FAST II and Falcon’s Opco transaction costs related to the Business Combination of $4.1 million and $12.2 million, respectively, are not yet settled as of September 30, 2025, and the Company is actively negotiating to settle them over the next 24 months. These transaction costs are recorded in accrued expenses. Negotiations regarding the terms of the costs yet to be settled are still ongoing and may change materially from these amounts accrued.

Previous wording

The Company is named from time to time as a party to lawsuits and other types of legal proceedings and claims in the normal course of business. As previously disclosed in the Company’s Annual Report, on March 27, 2024, a lawsuit was filed against the Company by Guggenheim Securities, LLC (“Guggenheim”) in which Guggenheim alleges that the Company owes certain fees and expenses of $11.1 million for services allegedly performed by Guggenheim in connection with the Business Combination consummated on October 6, 2023 (the “Guggenheim Complaint”). The Company has denied all liability in response to the Guggenheim Complaint. In addition, the Company has now filed counterclaims against Guggenheim for fraud, breach of contract, breach of fiduciary duty, and equitable recession. Guggenheim has denied all liability as to those amended counterclaims. On June 30, 2025, Guggenheim filed a Notice of Issue and Certificate of Readiness for trial, but discovery has not been concluded and Falcon's moved to strike it. Solely as part of the Company’s accounting approach to transaction expenses related to the Business Combination, prior to the Company’s receipt of the Guggenheim Complaint, the Company accrued $11.1 million as of June 30, 2025 and December 31, 2024, with respect to the alleged amended engagement agreement with Guggenheim. The Company intends to vigorously defend itself against the claims alleged in the Guggenheim Complaint and contest the amounts Guggenheim asserts are owed, and to pursue damages based on the Company's amended counterclaims.

Current wording

The Company is named from time to time as a party to lawsuits and other types of legal proceedings and claims in the normal course of business. As previously disclosed in the Company’s Annual Report, on March 27, 2024, a lawsuit was filed against the Company by Guggenheim Securities, LLC (“Guggenheim”) in which Guggenheim alleges that the Company owes certain fees and expenses of $11.1 million for services allegedly performed by Guggenheim in connection with the Business Combination consummated on October 6, 2023 (the “Guggenheim Complaint”). The Company has denied all liability in response to the Guggenheim Complaint. In addition, the Company filed counterclaims against Guggenheim. Guggenheim denied all liability as to those amended counterclaims. On June 30, 2025, Guggenheim filed a Notice of Issue and Certificate of Readiness for trial, and on October 27, 2025 Guggenheim moved for summary judgment on its claims, which the Company opposed; on the same day, the Company moved for partial summary judgment on its claims which Guggenheim opposed. Pursuant to the Company’s accounting approach to transaction expenses related to the Business Combination, prior to the Company’s receipt of the Guggenheim Complaint, the Company accrued $11.1 million as of September 30, 2025 and December 31, 2024, with respect to the alleged amended engagement agreement with Guggenheim.

Previous wording

The Company has entered into various financing agreements with Infinite Acquisitions and Katmandu Ventures, LLC (“Katmandu Ventures”). As of June 30, 2025, we have aggregate outstanding balances of $28.8 million and $0.9 million under these financing agreements, respectively. The loan with Katmandu Ventures was due on May 16, 2025 and we are in negotiations to amend the loan.

Current wording

The Company has a financing agreement with Katmandu Ventures, LLC (“Katmandu Ventures”) with an outstanding balance of $0.6 million as of September 30, 2025. The loan was due on May 16, 2025 and we are in negotiations to amend the loan.

Previous wording

For more information regarding our related party transactions, see Note 8 — Long-term debt and borrowing arrangements and Note 10 — Related party transactions in the Company’s unaudited condensed consolidated financial statements.

Current wording

See "Note 9 – Long-term debt and borrowing arrangements", "Note 10 – Related party transactions" and "Note 16 – Equity" in the Company’s unaudited condensed consolidated financial statements.

Previous wording

Our cash flows used in operating activities are primarily driven by transaction, legal and professional fees associated with public company compliance costs and corporate overhead activities.

Current wording

Our cash flows used in operating activities are primarily driven by transaction, legal and professional fees associated with public company compliance costs, operating costs of our Falcon's Attraction services business and corporate overhead activities.

Previous wording

Cash used in operating activities increased for the six months ended June 30, 2025, compared to the same period in 2024, due to timing of payments.

Current wording

Cash used in operating activities increased for the nine months ended September 30, 2025, compared to the same period in 2024, due to the settlement of accounts payable and accrued obligations associated with our corporate overhead and compliance costs, and the investment in working capital for the growth of the Falcon's Beyond Brands business following the OES Acquisition.