GEN Restaurant Group, Inc.

Previous wording

GEN Restaurant Group is an Asian casual dining restaurant concept that offers an extensive menu of traditional Korean and Korean-American food, including high-quality meats, poultry, and seafood, all at a superior value. Founded in 2011 by two Korean immigrants, since the opening of our first restaurant in September 2011 we have grown to 57 company-owned restaurants located in California, Arizona, Hawaii, Nevada, Texas, New York, New Jersey, Oregon, Washington, Florida, North Carolina, and South Korea. Our restaurants have modern décor, lively Korean pop music playing in the background and embedded grills in the center of each table. We believe we offer our customers a unique dining experience in which guests cook the majority of the food themselves, reducing the need for chefs and servers and providing a similar customer experience across our restaurants.

Current wording

GEN Restaurant Group is an Asian casual dining restaurant concept that offers an extensive menu of traditional Korean and Korean-American food, including high-quality meats, poultry, and seafood, all at a superior value. Founded in 2011 by two Korean immigrants, since the opening of our first restaurant in September 2011 we have grown to 59 company-owned restaurants located in California, Arizona, Hawaii, Nevada, Texas, New York, Oregon, New Jersey, Washington, North Carolina, Florida and six stores in South Korea. Our restaurants have modern décor, lively Korean pop music playing in the background and embedded grills in the center of each table. We believe we offer our customers a unique dining experience in which guests cook the majority of the food themselves, reducing the need for chefs and servers and providing a similar customer experience across our restaurants.

Previous wording

We expect to continue growing our number of restaurants in the future. In 2022, our new restaurants generated average Payback Periods of approximately 1.9 years, which equates to an average ROI of over 50%. For the restaurants opened in 2024, the average Payback Periods was 2.3 years, which equates to an average ROI of approximately 45%. Going forward we are targeting for our new restaurant units a Payback Period of less than 3 year, which equates to an ROI of 33% to 40%. Restaurants range in size from 4.7 thousand to 12 thousand square feet and are typically located in high-activity commercial areas.

Current wording

We expect to continue to grow our number of restaurants in the future. For the restaurants opened in 2024, the average Payback Periods was 2.3 years, which equates to an average ROI of approximately 45%. Going forward we are targeting for our new restaurant units a Payback Period of less than 3 year, which equates to an ROI of 33% to 40%. Restaurants range in size from 4.7 thousand to 12 thousand square feet and are typically located in high-activity commercial areas.

Previous wording

On September 29, 2023, the Company entered into a loan agreement for a $20.0 million line of credit with PCB Bank. The line of credit matures on September 25, 2026, and bears interest at a variable rate per annum equal to 7.50% as of September 30, 2025. No amounts are outstanding under the line of credit as of September 30, 2025.

Current wording

On September 29, 2023, the Company entered into a loan agreement for a $20.0 million line of credit with PCB Bank. The line of credit matures on September 25, 2026, and bears interest at a variable rate per annum equal to 7.00% as of March 31, 2026. The balance outstanding under the line of credit is $4.5 million as of March 31, 2026.

Previous wording

On April 25, 2025, the Company entered into a loan agreement for a $2.0 million loan with PCB Bank. The loan matures on April 25, 2027, and bears interest at a variable interest rate per annum equal to 7.50% as of September 30, 2025. The Company makes quarterly payments in the amount of $250,000, in addition to monthly interest payments. The balance as of September 30, 2025 was $1.5 million.

Current wording

On April 25, 2025, the Company entered into a loan agreement for a $2.0 million loan with PCB Bank. The loan matures on April 25, 2027, and bears interest at a variable interest rate per annum equal to 7.00% as of March 31, 2026. The balance as of March 31, 2026 was $1.1 million.

Previous wording

On July 29, 2025, the Company entered into a loan agreement for $4.0 million with PCB Bank. The loan matures on July 29, 2027, and bears interest at a variable rate per annum equal to 0.25% over the Wall Street Journal Index rate (prime rate), which equals 7.50% as of September 30, 2025. The balance as of September 30, 2025 was $3.7 million.

Current wording

On July 29, 2025, the Company entered into a loan agreement for $4.0 million with PCB Bank. The loan matures on July 29, 2027, and bears interest at a variable rate per annum equal to 0.25% over the Wall Street Journal Index rate (prime rate), which equals 7.00% as of March 31, 2026. The balance as of March 31, 2026 was $2.8 million.

Previous wording

In assessing the performance of our business, we consider a variety of financial and performance measures. The key measures for determining how our business is performing include Net Income Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Restaurant-Level Adjusted EBITDA, Restaurant-Level Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share (“EPS”), Average Unit Volumes, comparable restaurant sales growth, the number of restaurant openings and revenue per square foot.

Current wording

In assessing the performance of our business, we consider a variety of financial and performance measures. The key measures for determining how our business is performing include Net (Loss) Income Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Restaurant-Level Adjusted EBITDA, Restaurant-Level Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share - basic and diluted, Adjusted earnings (loss) per share (“EPS”), Average Unit Volumes, comparable restaurant sales growth, the number of restaurant openings and revenue per square foot.

Previous wording

Net Income Margin is net income measured under accounting principles generally accepted in the United States of America (“GAAP”) divided by revenue.

Current wording

Net (Loss) Income Margin is net income measured under accounting principles generally accepted in the United States of America (“GAAP”) divided by revenue.

Previous wording

Adjusted EBITDA represents net income excluding interest expense, net, income taxes, depreciation and amortization, stock-based compensation, employee retention credits, litigation accruals, non-cash lease expense, non-cash lease expense related to pre-opening costs and gain on remeasurement of previously held interest. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue. Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures intended as supplemental measures of our performance and are neither required by, nor presented in accordance with, GAAP. For a discussion of why we consider these measures to be useful and their material risks and limitations, see “Non-GAAP Financial Measures.”

Current wording

Adjusted EBITDA represents net (loss) income excluding interest expense, net, income taxes, depreciation and amortization, stock-based compensation, employee retention credits, litigation accruals, non-cash lease expense, non-cash lease expense related to pre-opening costs and gain on remeasurement of previously held interest. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue. Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures intended as supplemental measures of our performance and are neither required by, nor presented in accordance with, GAAP. For a discussion of why we consider these measures to be useful and their material risks and limitations, see “Non-GAAP Financial Measures.”

Previous wording

Restaurant-Level Adjusted EBITDA is Income from operations plus adjustments to add-back the following expenses: depreciation and amortization, pre-opening costs, general and administrative expenses, and non-cash lease expense. Restaurant-Level Adjusted EBITDA Margin is the calculation of Restaurant-Level Adjusted EBITDA divided by revenue. For a discussion of why we consider these measures to be useful and their material risks and limitations, see “Non-GAAP Financial Measures.”

Current wording

Restaurant-Level Adjusted EBITDA is (Loss) Income from operations plus adjustments to add-back the following expenses: depreciation and amortization, pre-opening costs, general and administrative expenses, and non-cash lease expense. Non-cash items such as charges for asset impairments and asset disposals are not included in Restaurant-Level Adjusted EBITDA. Restaurant-level Adjusted EBITDA Margin is the calculation of Restaurant-Level Adjusted EBITDA divided by revenue. For a discussion of why we consider these measures to be useful and their material risks and limitations, see “Non-GAAP Financial Measures.”

Previous wording

Adjusted Net Income and Adjusted EPS

Current wording

Adjusted Net (Loss) Income and Adjusted EPS

Previous wording

Adjusted Net Income represents net (loss) income, adjusted for pre-opening costs, gain on remeasurement of previously held interest and stock-based compensation, and the related tax impact of the adjustments. Adjusted net income per share is defined as adjusted net income divided by the weighted-average number of shares of Class A common stock outstanding for the applicable period.

Current wording

Adjusted Net (Loss) Income represents net (loss) income, adjusted for pre-opening costs, gain on remeasurement of previously held interest and stock-based compensation, and the related tax impact of the adjustments. Adjusted net (loss) income per share is defined as adjusted net income divided by the weighted-average number of shares of Class A common stock outstanding for the applicable period.

Previous wording

The number of restaurant openings reflects the number of restaurants opened during a particular reporting period. Before we open new restaurants, we incur pre-opening costs. New restaurants may not be profitable, and their sales performance may not follow historical patterns. The number and timing of restaurant openings has had, and is expected to continue to have, an impact on our results of operations. The following table shows the change in our restaurant base for the three and nine months ended September 30, 2025 and 2024:

Current wording

The number of restaurant openings reflects the number of restaurants opened during a particular reporting period. Before we open new restaurants, we incur pre-opening costs. New restaurants may not be profitable, and their sales performance may not follow historical patterns. The number and timing of restaurant openings has had, and is expected to continue to have, an impact on our results of operations. The following table shows the change in our restaurant base for the three months ended March 31, 2026 and 2025:

Previous wording

Revenues. Revenues represent sales of food and beverages in restaurants and, to a minor extent, through our online portal. Restaurant revenues in a given period are directly impacted by the number of restaurants we operate, menu pricing, the number of customers visiting and comparable restaurant sales change. Revenue also includes gift card revenue earned.

Current wording

Revenues. Revenues represent sales of food and beverages in restaurants and, to a minor extent, through our online portal. Restaurant revenues in a given period are directly impacted by the number of restaurants we operate, menu pricing, the number of customers visiting and comparable restaurant sales change. Revenue also includes gift card revenue earned, and revenue earned through retail or wholesale distribution.

Previous wording

Interest income (expense), net. Interest income, net reflects income earned on deposits, net of cash and non-cash charges related to our outstanding debt and finance lease obligations.

Current wording

Interest (expense) income, net. Interest (expense) income, net reflects income earned on deposits, net of cash and non-cash charges related to our outstanding debt and finance lease obligations.

Previous wording

Food costs. Food costs were $17.5 million for the three months ended September 30, 2025, compared to $15.4 million for the three months ended September 30, 2024, an increase of $2.0 million, or 13.6%. The increase in food costs reflects inflationary cost increases and more restaurants in operation. As a percentage of revenue, food costs increased to 34.8% from 31.4%.

Current wording

Food costs. Food costs were $20.5 million for the three months ended March 31, 2026, compared to $19.3 million for the three months ended March 31, 2025, an increase of $1.2 million, or 6.4%. The increase in food costs reflects inflationary cost increases and more restaurants in operation. As a percentage of revenue, food costs increased to 38.0% from 33.6%.

Previous wording

Payroll and benefits. Payroll and benefits costs were $14.4 million for the three months ended September 30, 2025, compared to $15.0 million for the three months ended September 30, 2024, a decrease of $0.6 million, or 3.9%, as the Company implemented labor efficiencies. As a percentage of revenue, payroll and benefits costs decreased from 30.5% to 28.5%.

Current wording

Payroll and benefits. Payroll and benefits costs were $17.3 million for the three months ended March 31, 2026, compared to $18.2 million for the three months ended March 31, 2025, a decrease of $0.9 million, or 5.0%, as the Company implemented labor efficiencies. As a percentage of revenue, payroll and benefits costs increased slightly from 31.7% to 32.1%.

Previous wording

Occupancy expenses. Occupancy expenses were $5.4 million for the three months ended September 30, 2025 compared to $4.1 million for the three months ended September 30, 2024, an increase of $1.3 million, or 31.9%. The increase in occupancy expenses reflects the addition of 16 new locations. As a percentage of revenue, occupancy expenses were 10.8% in the three months ended September 30, 2025 compared to 8.4% in the three months ended September 30, 2024.

Current wording

Occupancy expenses. Occupancy expenses were $5.8 million for the three months ended March 31, 2026 compared to $5.1 million for the three months ended March 31, 2025, an increase of $0.7 million, or 13.5%. The increase in occupancy expenses reflects the addition of 10 new locations. As a percentage of revenue, occupancy expenses were 10.7% in the three months ended March 31, 2026 compared to 8.9% in the three months ended March 31, 2025.

Previous wording

Operating expenses. Operating expenses were $6.2 million for the three months ended September 30, 2025 compared to $5.7 million for the three months ended September 30, 2024, an increase of $0.4 million, or 7.8%, as expenses increased to support revenue growth and reflected inflationary cost increases. As a percentage of revenue, operating expenses were 12.2% in the three months ended September 30, 2025 and 11.7% in the three months ended September 30, 2024.

Current wording

Operating expenses. Operating expenses were $6.5 million for the three months ended March 31, 2026 compared to $5.9 million for the three months ended March 31, 2025, an increase of $0.6 million, or 13.5%, as expenses increased to support revenue growth from the new stores and reflected inflationary cost increases. As a percentage of revenue, operating expenses were 12.0% in the three months ended March 31, 2026 and 10.3% in the three months ended March 31, 2025.

Previous wording

Depreciation and amortization expenses. Depreciation and amortization expenses were $2.3 million for the three months ended September 30, 2025 and $1.7 million for the three months ended September 30, 2024. As a percentage of revenue, depreciation and amortization expenses at the restaurant-level were 4.5% during the three months ended September 30, 2025 and 3.5% during the three months ended September 30, 2024, with the increase related to more restaurants in operation.

Current wording

Depreciation and amortization expenses. Depreciation and amortization expenses were $2.3 million for the three months ended March 31, 2026 and $2.0 million for the three months ended March 31, 2025. As a percentage of revenue, depreciation and amortization expenses at the restaurant-level were 4.3% during the three months ended March 31, 2026 and 3.5% during the three months ended March 31, 2025, with the increase related to more restaurants in operation.

Previous wording

Pre-opening costs. Pre-opening costs were $2.3 million for the three months ended September 30, 2025 compared to $1.8 million for the three months ended September 30, 2024.This represents eight additional restaurants in development during the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.

Current wording

Pre-opening costs. Pre-opening costs were $1.8 million for the three months ended March 31, 2026 compared to $2.7 million for the three months ended March 31, 2025.This represents less restaurants in development during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025.

Previous wording

General and administrative expenses. General and administrative expenses were $6.5 million for the three months ended September 30, 2025 compared to $5.2 million for the three months ended September 30, 2024, an increase of $1.3 million, or 23.8%. The increase is primarily due to additional marketing and personnel costs for the expansion of restaurants in development. As a percentage of revenue, general and administrative expenses increased from 10.6% for the three months ended September 30, 2024 to 12.8% for the three months ended September 30, 2025.

Current wording

General and administrative expenses. General and administrative expenses were $6.9 million for the three months ended March 31, 2026 compared to $6.4 million for the three months ended March 31, 2025, an increase of $0.5 million, or 8.3%. The increase is primarily due to additional marketing costs. As a percentage of revenue, general and administrative expenses increased from 11.1% for the three months ended March 31, 2025 to 12.8% for the three months ended March 31, 2026.

Previous wording

Other loss. Consists of a legal settlement accrual in each period.

Current wording

Other loss. Consists of a legal settlement accrual in each period presented.

Previous wording

Interest income (expense), net. During the three months ended September 30, 2025, interest expense, net was $121 thousand compared to $196 thousand of interest income, net during the three months ended September 30, 2024. The net interest income was primarily due to the interest income earned on the proceeds from the IPO transaction and the reduction of proceeds used for development of new restaurants.

Current wording

Interest (expense) income, net. During the three months ended March 31, 2026, interest expense, net was $226 thousand compared to $60 thousand of interest income, net during the three months ended March 31, 2025. The increase in interest expense is related to higher debt levels, partially offset by lower net interest income was primarily due to the interest income earned on the proceeds from the IPO transaction and the reduction of proceeds used for development of new restaurants.

Previous wording

Adjusted EBITDA represents net income excluding interest (income) expense, income taxes, depreciation and amortization, and also excludes non-recurring and certain other non-cash items, such as stock-based compensation expense, employee retention credits, litigation accruals, non-cash lease expense, non-cash lease expense related to pre-opening costs and gain on remeasurement of previously held interest. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue. We believe that Adjusted EBITDA and Adjusted EBITDA Margin provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and operating results, as these measures reflect normal recurring cash operating expenses essential to supporting the operations of our company. We expect Adjusted EBITDA to increase with the number of new restaurants we open and with comparable restaurant sales growth.

Current wording

Adjusted EBITDA represents net (loss) income excluding interest (income) expense, income taxes, depreciation and amortization, and also excludes non-recurring and certain other non-cash items, such as stock-based compensation expense, employee retention credits, litigation accruals, non-cash lease expense, non-cash lease expense included in pre-opening costs and gain on remeasurement of previously held interest. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by revenue. We believe that Adjusted EBITDA and Adjusted EBITDA Margin provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and operating results, as these measures reflect normal recurring cash operating expenses essential to supporting the operations of our company. We expect Adjusted EBITDA to increase with the number of new restaurants we open and with comparable restaurant sales growth.

Previous wording

The following table reconciles net income to Adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024.

Current wording

The following table reconciles net loss to Adjusted EBITDA for the three months ended March 31, 2026 and 2025.

Previous wording

We define Restaurant-Level Adjusted EBITDA as Income (loss) from operations plus adjustments to add-back the following expenses: depreciation and amortization, pre-opening costs, general and administrative expense, and non-cash lease expense. We define Restaurant-Level Adjusted EBITDA Margin as Restaurant-Level Adjusted EBITDA divided by revenue.

Current wording

We define Restaurant-Level Adjusted EBITDA as loss from operations plus adjustments to add-back the following expenses: depreciation and amortization, pre-opening costs, general and administrative expense, and non-cash lease expense. We define Restaurant-Level Adjusted EBITDA Margin as Restaurant-Level Adjusted EBITDA divided by revenue.

Previous wording

The following table reconciles Income from Operations to Restaurant-Level Adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024:

Current wording

The following table reconciles Income from Operations to Restaurant-Level Adjusted EBITDA for the three months ended March 31, 2026 and 2025:

Previous wording

Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share, Restaurant-Level Adjusted EBITDA, and Restaurant-Level Adjusted EBITDA Margin are non-GAAP measures intended as supplemental measures of our performance and are neither required by, nor presented in accordance with GAAP. Our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Our computation of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted net income, Adjusted net (loss) income attributable to Class A common stock per share, Restaurant-Level Adjusted EBITDA and Restaurant-Level Adjusted EBITDA Margin may not be comparable to other similarly titled measures presented by other companies, because all companies may not calculate Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share, Restaurant-Level Adjusted EBITDA, and Restaurant-Level Adjusted EBITDA Margin in the same fashion. These non-GAAP financial measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP.

Current wording

Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share - basic and diluted, Restaurant-Level Adjusted EBITDA, and Restaurant-Level Adjusted EBITDA Margin are non-GAAP measures intended as supplemental measures of our performance and are neither required by, nor presented in accordance with GAAP. Our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Our computation of Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share - basic and diluted, Restaurant-Level Adjusted EBITDA and Restaurant-Level Adjusted EBITDA Margin may not be comparable to other similarly titled measures presented by other companies, because all companies may not calculate Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted net (loss) income, Adjusted net (loss) income attributable to Class A common stock per share, Restaurant-Level Adjusted EBITDA, and Restaurant-Level Adjusted EBITDA Margin in the same fashion. These non-GAAP financial measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP.

Previous wording

The following table reconcile net (loss) income to Adjusted net income and Adjusted net income per share for the three and nine months ended September 30, 2025 and 2024:

Current wording

The following table reconcile net (loss) income to Adjusted net (loss) income and Adjusted net income per share for the three months ended March 31, 2026 and 2025:

Previous wording

As of September 30, 2025 we had $4.8 million of cash and ($27.3) million of working capital deficit, which is calculated by subtracting current liabilities from current assets, compared with $23.7 million in cash and ($7.2) million of working capital deficit as of December 31, 2024. On June 30, 2023, we completed the IPO of 4,140,000 shares of Class A common stock. The public offering price per share sold in the IPO was $12.00 per share, resulting in aggregate net proceeds of approximately $46.2 million after deducting the underwriting discounts and commission and offering expenses payable.

Current wording

As of March 31, 2026 we had $4.4 million of cash and $37.8 million of working capital deficit, which is calculated by subtracting current liabilities from current assets, compared with $2.8 million in cash and $31.3 million of working capital deficit as of December 31, 2025.

Previous wording

Our primary uses of cash are for operational expenditures and capital investments, including new restaurants, costs incurred for restaurant remodels and restaurant equipment and fixtures. During the first nine months of 2025, we opened 15 new restaurants which were all self-funded. There is no guarantee that if we need to raise any additional capital that we will be able to do so.

Current wording

Our primary uses of cash are for operational expenditures and capital investments, including new restaurants, costs incurred for restaurant remodels and restaurant equipment and fixtures. During the year ended 2025, we opened 15 new restaurants which were all self-funded. There is no guarantee that if we need to raise any additional capital that we will be able to do so.

Previous wording

Net cash provided by operating activities during the nine months ended September 30, 2024 was $10.5 million, the result of net income of $5.9 million, adjusted by non-cash charges of depreciation and amortization of $5.0 million, and amortization of operating lease assets of $5.4 million, stock-based compensation of $2.2 million and a reduction related to the gain on the acquisition of the remaining ownership interest in GKBH. The net cash outflows from changes in operating assets and liabilities were collectively a decrease of $4.6 million.

Current wording

Net cash provided by operating activities during the three months ended March 31, 2026 was $2.7 million, the result of net loss of $7.2 million, adjusted by non-cash charges of depreciation and amortization of $2.4 million, amortization of operating lease assets of $1.9 million, and stock-based compensation expense of $0.7 million. The net cash outflows from changes in operating assets and liabilities were collectively an increase of $5.1 million.

Previous wording

Net cash provided by operating activities during the nine months ended September 30, 2025 was $3.8 million, the result of net loss of $7.3 million, adjusted by non-cash charges of depreciation and amortization of $6.6 million, amortization of operating lease assets of $5.0 million, and stock-based compensation expense of $2.2 million. The net cash outflows from changes in operating assets and liabilities were collectively a decrease of $1.7 million.

Current wording

Net cash provided by operating activities during the three months ended March 31, 2025 was $2.1 million, the result of net loss of $2.0 million, adjusted by non-cash charges of depreciation and amortization of $2.0 million, and amortization of operating lease assets of $1.6 million, stock-based compensation of $0.7 million. The net cash outflows from changes in operating assets and liabilities were collectively a decrease of $52 thousand.

Previous wording

Net cash used in investing activities during the nine months ended September 30, 2025 was $22.5 million, reflecting the purchase of property and equipment.

Current wording

Net cash used in investing activities during the three months ended March 31, 2026 was $3.4 million, reflecting the purchase of property and equipment.

Previous wording

Net cash used in investing activities during the nine months ended September 30, 2024 was $22.7 million, reflecting $16.7 million for the purchase of property and equipment and a $6.0 million payment for the acquisition of the remaining ownership interest in GKBH.

Current wording

Net cash used in investing activities during the three months ended March 31, 2025 was $6.8 million, reflecting the purchase of property and equipment.

Previous wording

Net cash used in financing activities during the nine months ended September 30, 2024 was $1.6 million, primarily due to proceeds from third party loans of $3.0 million, partially offset by payments to members and repayments of third party loans.

Current wording

Net cash provided by financing activities during the three months ended March 31, 2026 was $2.4 million, primarily due to net proceeds on the PCB Bank line of credit of $3.5 million, partially offset by payments of $1.1 million on third party notes payable.

Previous wording

Net cash used in financing activities during the nine months ended September 30, 2025 was $0.3 million, primarily due to payments of $5.0 million on the line of credit and third party notes payable, $800 thousand in distributions paid on non-controlling interests, $200 thousand on the repurchase of common stock, and $200 thousand in dividends paid on common stock, partially offset by proceeds from third party loans of $6.0 million.

Current wording

Net cash used in financing activities during the three months ended March 31, 2025 was $3.6 million, primarily due to a payment of $3.0 million on the line of credit and $200 thousand for the repurchase of common stock.

Previous wording

For the nine months ended September 30, 2025, the effect of exchange rate changes on cash and cash equivalents primarily reflects the translation impact from fluctuations in the value of the South Korean won relative to the U.S. dollar. During the period, the won experienced modest depreciation against the U.S. dollar, resulting in a loss on foreign currency translation of $74 thousand compared to $0 in the comparative period.

Current wording

For the three months ended March 31, 2026, the effect of exchange rate changes on cash and cash equivalents primarily reflects the translation impact from fluctuations in the value of the South Korean won relative to the U.S. dollar. During the three months ended March 31, 2026, the won experienced modest depreciation against the U.S. dollar, resulting in a loss on foreign currency translation of $12 thousand compared to $0 in the comparative period.

Previous wording

As of September 30, 2025, we had $13.3 million in contractual obligations relating to debt, including EIDL loans payable. All contractual obligations are expected to be paid during the next 12 months utilizing cash and cash equivalents on hand and provided by operating activities. For operation lease obligations, See “Note 10 - Leases” in the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Current wording

As of March 31, 2026, we had $15.0 million in contractual obligations relating to debt, including EIDL loans payable. All contractual obligations are expected to be paid during the next 12 months utilizing cash and cash equivalents on hand and provided by operating activities. For operation lease obligations, See “Note 10 - Leases” in the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Previous wording

Our office leases provide for fixed minimum rent payments. Our restaurant leases provide for fixed minimum rent payments and some require additional contingent rent payments based upon sales in excess of specified thresholds. When achievement of such sales thresholds is deemed probable, contingent rent is accrued in proportion to the sales recognized in the period. For operating leases that include free-rent periods and rent escalation clauses, we recognize rent expense based on the straight-line method. For the purpose of calculating rent expenses under the straight-line method, the lease term commences on the date we obtain control of the property. Lease incentives used to fund leasehold improvements are recognized when earned and reduce the operating right-of-use asset related to the lease. These are amortized through the operating right-of-use asset as reductions of expense over the lease term. Restaurant lease expenses are included in the occupancy expenses line item, while office lease expenses are included in the general and administrative expenses line item in the accompanying condensed consolidated statements of Comprehensive Income (Loss).

Current wording

Our office leases provide for fixed minimum rent payments. Our restaurant leases provide for fixed minimum rent payments and some require additional contingent rent payments based upon sales in excess of specified thresholds. When achievement of such sales thresholds is deemed probable, contingent rent is accrued in proportion to the sales recognized in the period. For operating leases that include free-rent periods and rent escalation clauses, we recognize rent expense based on the straight-line method. For the purpose of calculating rent expenses under the straight-line method, the lease term commences on the date we obtain control of the property. Lease incentives used to fund leasehold improvements are recognized when earned and reduce the operating right-of-use asset related to the lease. These are amortized through the operating right-of-use asset as reductions of expense over the lease term. Restaurant lease expenses are included in the occupancy expenses line item, while office lease expenses are included in the general and administrative expenses line item in the accompanying condensed consolidated statements of comprehensive loss.