Nuburu, Inc.
For the period ended Jun 30, 2026. Filed Aug 14, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 14, 2026
BURU$0.21+8.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-20.
0001193125-26-232836
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-14.
0001193125-26-352609
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 134 previous paragraphs and 158 current paragraphs.
88 unchanged; 38 reworded; 23 added; 8 removed; 0 previous and 9 current paragraphs rearranged.
Tables are not compared: 2 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
Golden Power Approval of Tekne Transaction
Current report
On August 5, 2026, the Company received Golden Power regulatory approval from the Italian government, which was required in order for the Company to close its proposed acquisition of a 70% controlling interest in Tekne. As a result, the Company expects to close the Tekne transaction and obtain a 70% controlling interest in Tekne on or about 30 days following receipt of the Golden Power regulatory approval or on such later date as may be mutually agreed upon in writing by the parties to the Investment Agreement. For additional information, see Note 4 to the condensed consolidated financial statements included herein.
Current report
On July 17, 2026, the Company’s Common Stock traded below $0.10 during the trading day. As a result, on July 17, 2026, the Company received a letter from the NYSE American stating that it had commenced proceedings to delist the Company’s Common Stock from the NYSE American because the Company was not in compliance with Section 1003(f)(v) of the NYSE American Company Guide due to the low selling price of the Company’s Common Stock. The Company’s Common Stock ceased to trade on the NYSE American on July 17, 2026 and began trading on the OTC market on July 20, 2026.
Current report
Under NYSE American delisting procedures, the Company has the right to a review of NYSE American’s determination by the Listings Qualifications Panel of the NYSE American. The Company appealed the decision and requested a review hearing, which is scheduled to take place in September 2026. The Company intends to implement a reverse stock split, for which it has already obtained stockholder approval, on the OTC market to regain compliance under NYSE American.
Current report
Loss on Issuance of SEPA
Current report
Loss on issuance of SEPA relates to the initial fair value of the SEPA put right at inception of the SEPA on May 30, 2025. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report
SEPA Fees and Issuance Costs
Current report
SEPA fees and issuance costs relates to fees and issuance costs incurred in connection with the SEPA. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report
Cost of Revenue. Cost of revenue increased $908,034 during the three months ended June 30, 2026 compared to the same period in 2025, which is primarily due to an approximate $903,000 increase due to the Orbit Change of Control and Lyocon Acquisition.
Current report
General and Administrative. General and administrative expenses decreased $462,336 during the three months ended June 30, 2026 compared to the same period in 2025, which includes an approximate $72,000 increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, general and administrative decreased $534,574. This decrease is primarily driven by (i) a decrease in professional and consulting services of approximately $423,000 due largely to certain one-time expenses incurred during the second quarter of 2025 related to the Transformation Plan, (ii) a decrease in acquisition-related expenses of approximately $417,000 due primarily to one-time acquisition related expenses incurred in the second quarter of 2025, (iii) a decrease in stock-based compensation expenses of approximately $281,000, due primarily to a reduction in employee headcount during 2025, partially offset by increases in (iv) personnel costs of approximately $390,000 primarily related to an increase in bonus expense paid to executives, (v) legal expenses of approximately $148,000, and (vi) accounting and audit services of approximately $41,000 related to our Transformation Plan.
Current report
Change in Fair Value of Warrant Liabilities. We recorded a gain of $829,415 during the three months ended June 30, 2026, which is primarily related to a decrease of approximately $1,279,000 in the fair value of the February 2026 Offering Common Warrants, largely due to a decrease in our share price during the period. We recorded a loss of $16,986 during the three months ended June 30, 2025, which largely resulted from an increase in the Company's share price between March 31, 2025 and June 30, 2025.
Current report
Loss on Issuance of Debt. We recorded a loss of $766,296 during the three months ended June 30, 2025, primarily related to an aggregate excess of $617,693 in the initial fair value of certain of the Indigo Capital Convertible Notes, Diagonal Convertible Notes, and Brick Lane Convertible Notes over the proceeds received. For additional information, see Note 10 to the condensed consolidated financial statements included herein.
Current report
Change in Fair Value of Investments. We recorded a loss of $3,087,260 during the three months ended June 30, 2026, which primarily resulted from a decrease of approximately (i) $2,913,000 in the fair value of the H&K Investment due to the decrease in H&K's share price over the period and (ii) $170,000 in the fair value of the Tekne Investment primarily due to an increase in the discount rate.
Current report
Loss on Issuance of SEPA. We recorded a loss of $2,582,724 during the three months ended June 30, 2025 related to the initial fair value of the SEPA put option at inception of the SEPA on May 30, 2025. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report
SEPA Fees and Issuance Costs. We recorded $45,515 and $1,075,000 of SEPA fees and issuance costs during the three months ended June 30, 2026 and 2025, respectively, which relates to (i) a structuring fee payable to the SEPA Investor in the amount of $25,000, (ii) a commitment fee payable to the SEPA Investor in Common Stock in an amount equal to 1% of the Commitment Amount, or $1,000,000, paid 50% on execution of the SEPA, which resulted in the issuance of 1,332,623 shares of Common Stock to the SEPA Investor during the second quarter of 2025, and 50% 90 days following the date of the SEPA and (iii) legal expenses of $50,000 related to the issuance of the SEPA. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report
Loss on Extinguishment of Debt. We recorded a loss on the extinguishment of debt of $1,375,819 during the three months ended June 30, 2025, which primarily comprises (i) $1,071,997 related to the excess of the fair value of the 2025 June Brick Lane Convertible Notes at issuance and the carrying value of the 100,000 shares of the Company's outstanding Series A Preferred Stock that was extinguished, (ii) $163,500 related to the issuance of the 2025 April Indigo Capital Convertible Notes in exchange for the extinguishment of an existing unsecured promissory note of the Company with a carrying value of $2,108,523, and (iii) $140,323 related to the excess of the fair value of the 2025 Bomore Convertible Notes at issuance and the carrying value of the 100,000 shares of the Company's outstanding Series A Preferred Stock that was extinguished. For further information, see Note 10 to the condensed consolidated financial statements included herein.
Current report
Selling and Marketing. Selling and marketing expenses increased $2,489,550 during the six months ended June 30, 2026 compared to the same period in 2025, which includes an insignificant increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, selling and marketing increased $2,485,464. This increase is primarily due to an increase in (i) professional and consulting related expenses of approximately $1,566,000, primarily related to an increase in branding and public relations consulting expenses as part of our Transformation Plan, (ii) marketing expenses of approximately $745,000, and (iii) stock-based compensation expenses of approximately $180,000 primarily related to an increase in stock-based compensation expense in connection with the Common Stock issued for services provided by non-employee consultants, as discussed further in Note 14 to the condensed consolidated financial statements included herein.
Current report
Change in Fair Value of Investments. We recorded a loss of $3,123,545 during the six months ended June 30, 2026, which primarily resulted from a decrease of approximately (i) $2,954,000 in the fair value of the H&K Investment due to the decrease in H&K's share price over the period and (ii) $170,000 in the fair value of the Tekne Investment primarily due to an increase in the discount rate.
Current report
Loss on Issuance of SEPA. We recorded a loss of $2,582,724 during the six months ended June 30, 2025 related to the initial fair value of the SEPA put option at inception of the SEPA on May 30, 2025. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report
SEPA Fees and Issuance Costs. We recorded $45,515 and $1,075,000 of SEPA fees and issuance costs during the six months ended June 30, 2026 and 2025, respectively. The amount recorded during the six months ended June 30, 2025, which relates to (i) a structuring fee payable to the SEPA Investor in the amount of $25,000, (ii) a commitment fee payable to the SEPA Investor in Common Stock in an amount equal to 1% of the Commitment Amount, or $1,000,000, paid 50% on execution of the SEPA, which resulted in the issuance of 1,332,623 shares of Common Stock to the SEPA Investor during the second quarter of 2025, and 50% 90 days following the date of the SEPA and (iii) legal expenses of $50,000 related to the issuance of the SEPA. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report
Loss on Extinguishment of Debt. During the six months ended June 30, 2025, we recorded a loss on the extinguishment of debt of $6,873,335, which primarily is comprised of (i) $2,123,403 related to excess of the initial fair value of $3,003,300 of the 2025 March Indigo Capital Convertible Notes over the carrying amount of the August 2024 Convertible Notes, (ii) $1,682,641 related to the sale of collateral, further described in Note 8 to the condensed consolidated financial statements, (iii) $1,174,519 related to the issuance of 9,186,581 shares to holders of Junior Notes to extinguish an aggregate $411,865 of principal and accrued interest under the Junior Notes, (iv) $1,071,997 related to the excess of the fair value of the 2025 June Brick Lane Convertible Notes at issuance and the carrying value of the 100,000 shares of the Company's outstanding Series A Preferred Stock that was extinguished, (v) $480,399 related to the issuance of 1,878,620 shares to Esousa Group Holdings LLC to extinguish an aggregate $389,375 of principal and accrued interest under the August 2024 Convertible Notes, (vi) $163,500 related to the issuance of the 2025 April Indigo Capital Convertible Notes in exchange for the extinguishment of an existing unsecured promissory note of the Company with a carrying value of $2,108,523, and (vii) $140,323 related to the excess of the fair value of the 2025 Bomore Convertible Notes at issuance and the carrying value of the 100,000 shares of the Company's outstanding Series A Preferred Stock that was extinguished. For further information, see Note 10 to the condensed consolidated financial statements included herein.
Current report
Net cash provided by financing activities was $12,976,178 and $5,138,257 for the six months ended June 30, 2026 and 2025, respectively.
Current report
Net cash provided by financing activities during the six months ended June 30, 2025 is comprised primarily of (i) $5,399,708 of proceeds from certain debt instruments issued, as further described in Note 8 to the condensed consolidated financial statements, (ii) payments on debt borrowings of $1,024,898, (iii) $1,000,000 in proceeds from the Liqueous Settlement Agreement, as further described in Note 8 to the condensed consolidated financial statements, and (iv) payments of notes issuance and SEPA issuance costs of $236,380.
Removed paragraphs (8)
Previous report
NYSE American will review us periodically for compliance with the Compliance Plan. If we are not in compliance with the continued listing standards by October 29, 2026, or if we do not make progress consistent with the Compliance Plan during the Plan Period, NYSE American may initiate delisting proceedings as appropriate. However, we may appeal a staff delisting determination in accordance with the Company Guide.
Previous report
The Notice, 2026 Notice and NYSE’s acceptance of the Compliance Plan have no immediate effect on the listing or trading of our securities and our Common Stock will continue to trade on the NYSE American under the symbol “BURU” during the Plan Period with the designation of “.BC” to indicate that we are not in compliance with the NYSE American’s continued listing standards.
Previous report
Other Loss, Net
Previous report
Other loss, net consists largely of foreign currency transaction gains or losses and, historically, issuance costs incurred in connection with the issuance of certain debt instruments.
Previous report
Gain on Initial Recognition of Tekne Investment. We recognized a gain of $84,000 during the three months ended March 31, 2026, representing the excess of the initial fair value of the Tekne Investment over the Tekne Subordinated Convertible Note issued as consideration, compared to no comparable gain during the three months ended March 31, 2025. For additional information, refer to Note 6 to the condensed consolidated financial statements included herein.
Previous report
Loss on Extinguishment of Debt. During the three months ended March 31, 2025, we recorded a loss on the extinguishment of debt of $5,497,516, which primarily related to the issuance of shares to noteholders of the Senior Notes and Junior Notes to extinguish principal and accrued interest under the Senior Notes and Junior Notes. For further information, see Note 10 to the condensed consolidated financial statements included herein. There was no loss on the extinguishment of debt recorded for the three months ended March 31, 2026.
Previous report
Net cash provided by financing activities was $12,082,288 and $2,539,392 for the three months ended March 31, 2026 and 2025, respectively.
Previous report
Net cash provided by financing in activities during the three months ended March 31, 2025 is comprised primarily of (i) $2,394,708 of proceeds from the issuance of the Indigo Capital Convertible Notes, (ii) $1.0 million in proceeds from the Liqueous Settlement Agreement, partially offset by (iii) a payment on debt borrowings of $835,316 related to the extinguishment of the remaining August 2024 Convertible Notes.
Reworded paragraphs (38)
Previous wording
We have not yet achieved full commercialization and expect continued losses until we can do so. We must rely on capital from investors to support operations. From inception, we have continued to incur operating losses and negative cash flows from operating activities. For the three months ended March 31, 2026 and 2025, we incurred a net loss of $459,898 and $16,611,425, respectively, and we had an accumulated deficit of $200,939,729 and $200,479,831 as of March 31, 2026 and December 31, 2025, respectively. We generated total revenue of $407,644 and nil during the three months ended March 31, 2026 and 2025, respectively.
Current wording
We have not yet achieved full commercialization and expect continued losses until we can do so. We must rely on capital from investors to support operations. From inception, we have continued to incur operating losses and negative cash flows from operating activities. For the three months ended June 30, 2026 and 2025 and six months ended June 30, 2026 and 2025, the Company has incurred net losses of $6,475,862 and $12,224,975, respectively, and $6,935,760 and $28,836,400, respectively, and the Company has an accumulated deficit of $207,415,591 as of June 30, 2026. We generated total revenue of $524,927, nil, $932,571 and nil during the three months ended June 30, 2026 and 2025 and six months ended June 30, 2026 and 2025, respectively.
Previous wording
For information related to certain acquisition, investment-related and joint venture transactions, including the January 2026 Orbit Change of Control, the Lyocon Acquisition, the Tekne Investment, the Tekne Letter, the H&K Investment, the Maddox JV and the Beryl Agreement, Notes 4, 6 and 7 to the condensed consolidated financial statements included herein.
Current wording
For information related to certain acquisition, investment-related and joint venture transactions, including the January 2026 Orbit Change of Control, the Lyocon Acquisition, the Tekne Investment, the Tekne Letter, the H&K Investment, the Maddox JV and the Beryl Agreement, see Notes 4, 6 and 7 to the condensed consolidated financial statements included herein.
Previous wording
As part of our ongoing efforts to eliminate liabilities and return to compliance with NYSE American stockholder equity requirements, on February 6, 2026, we entered into an exchange agreement with Indigo Capital LP ("Indigo"), pursuant to which we agreed to issue a pre-funded warrant to Indigo in exchange for the extinguishment and cancellation of 844,938 shares of our Series A Preferred Stock held by Indigo.
Current wording
As part of our ongoing efforts to eliminate liabilities and return to compliance with NYSE American stockholder equity requirements, during the first half of 2026, we entered into certain exchange agreements with Indigo Capital LP ("Indigo"), pursuant to which we agreed to issue pre-funded warrants to purchase shares of Common Stock to Indigo in exchange for the extinguishment and cancellation of an aggregate 1,182,787 shares of our Series A Preferred Stock held by Indigo.
Previous wording
February 2026 Offering and 2025 Offerings
Current wording
July 2026 Offering, February 2026 Offering and 2025 Offerings
Previous wording
In February 2026 and September 2025, we consummated best efforts public offerings of Common Stock and certain warrants. For additional information, see Notes 11 and 12 to the condensed consolidated financial statements included herein.
Current wording
In July 2026, February 2026 and September 2025, we consummated best efforts public offerings of Common Stock, certain warrants to purchase Common Stock, and Series B preferred stock. For additional information, see Notes 11, 12 and 18 to the condensed consolidated financial statements included herein.
Previous wording
During the three months ended March 31, 2026, we entered into certain debt instruments with various third parties. For additional information, see Note 10 to the condensed consolidated financial statements included herein.
Current wording
During the six months ended June 30, 2026, we entered into certain debt instruments with various third parties. For additional information, see Note 10 to the condensed consolidated financial statements included herein.
Previous wording
Trading of our Common Stock was halted by NYSE American on February 13, 2026, because the trading price dropped below NYSE American’s Minimum Trading Price of $0.10. On February 27, 2026, we effected a 1-for-4.99 reverse stock split (the "2026 Reverse Stock Split") in order to return to compliance with the Minimum Trading Price requirement. Our Common Stock resumed trading on March 2, 2026.
Current wording
On February 27, 2026, we effected the 2026 Reverse Stock Split in order to return to compliance with the Minimum Trading Price requirement. Our Common Stock resumed trading on March 2, 2026.
Previous wording
On April 29, 2025, we received a Notice of Noncompliance (the “Notice”) from NYSE Regulation indicating that we were not in compliance with Section 1003(a)(i) of the NYSE American LLC Company Guide (the “Company Guide”), which requires a company to maintain stockholders’ equity of $2,000,000 or more if it has reported losses from continuing operations or net losses in two of its three most recent fiscal years. As of March 31, 2026 and December 31, 2025, total stockholders’ equity (deficit) was $2,172,572 and $(15,182,173), respectively.
Current wording
On April 29, 2025, we received a Notice of Noncompliance (the “Notice”) from NYSE Regulation indicating that we were not in compliance with Section 1003(a)(i) of the NYSE American LLC Company Guide (the “Company Guide”), which requires a company to maintain stockholders’ equity of $2,000,000 or more if it has reported losses from continuing operations or net losses in two of its three most recent fiscal years. As of June 30, 2026 and December 31, 2025, total stockholders’ equity (deficit) was $9,369,319 and $(15,182,173), respectively.
Previous wording
On May 12, 2026, we received a Notice of Noncompliance (the “2026 Notice”) from NYSE Regulation indicating that we were not in compliance with Section 1003(a)(ii) of the Company Guide, which requires a company to maintain stockholders’ equity of $4.0 million or more if it has reported losses from continuing operations or net losses in three of its four most recent fiscal years. In connection with the 2026 Notice, the NYSE American is not requiring that a new compliance plan be provided by us and we will continue to operate in accordance with the Compliance Plan previously accepted by NYSE American.
Current wording
On May 12, 2026, we received a Notice of Noncompliance (the “2026 Notice”) from NYSE Regulation indicating that we were not in compliance with Section 1003(a)(ii) of the Company Guide, which requires a company to maintain stockholders’ equity of $4,000,000 or more if it has reported losses from continuing operations or net losses in three of its four most recent fiscal years. In connection with the 2026 Notice, the NYSE American did not require that a new compliance plan be provided by us and we will continue to operate in accordance with the Compliance Plan previously accepted by NYSE American.
Previous wording
Following the Lyocon Acquisition and the Orbit Transaction, our revenue consists of (i) product sales and related professional services from Lyocon and (ii) software-as-a-service and hosted software subscriptions, application maintenance services and professional services from Orbit. We had no revenue during the three months ended March 31, 2025. For additional information, refer to Notes 2 and 9 to the condensed consolidated financial statements included herein.
Current wording
Following the Lyocon Acquisition and the Orbit Transaction, our revenue consists of (i) product sales and related professional services from Lyocon and (ii) software-as-a-service and hosted software subscriptions, application maintenance services and professional services from
Previous wording
Change in fair value of contingent consideration represents the period change in the fair value of contingent consideration obligations recognized in connection with our acquisitions, which are remeasured to fair value at each reporting date with the corresponding gain or loss recorded in the condensed consolidated statement of operations. For additional information, refer to Notes 4 and 7 to the condensed consolidated financial statements included herein.
Current wording
Change in fair value of contingent consideration represents the period change in the fair value of contingent consideration obligations recognized in connection with our acquisitions, which are remeasured to fair value at each reporting date with the corresponding gain or loss recorded in the condensed consolidated statements of operations and comprehensive loss. For additional information, refer to Notes 4 and 7 to the condensed consolidated financial statements included herein.
Previous wording
Change in fair value of derivative liability consists of non-cash gains or losses recognized on the remeasurement of liability-classified derivatives, including, (i) during the three months ended March 31, 2026, the amended Orbit Preferred Obligation, which was accounted for as a derivative liability under ASC 815 between the February 9, 2026 amendment and stockholder approval of the share issuance in March 2026, and (ii) historically the embedded derivatives bifurcated from the August 2024 Convertible Notes. The instruments are remeasured to fair value at each reporting date with the corresponding gain or loss recorded on the condensed consolidated statement of operations. For additional information, refer to Notes 7 and 12 to the condensed consolidated financial statements included herein.
Current wording
Change in fair value of derivative liability consists of non-cash gains or losses recognized on the remeasurement of liability-classified derivatives, including, (i) during the three months ended March 31, 2026, the amended Orbit Preferred Obligation, which was accounted for as a derivative liability under ASC 815 between the February 9, 2026 amendment and stockholder approval of the share issuance in March 2026, and (ii) historically the embedded derivatives bifurcated from the August 2024 Convertible Notes. The instruments are remeasured to fair value at each reporting date with the corresponding gain or loss recorded on the condensed consolidated statements of operations and comprehensive loss. For additional information, refer to Notes 7 and 12 to the condensed consolidated financial statements included herein.
Previous wording
Revenue. Revenue increased $407,644 during the three months ended March 31, 2026 compared to the same period in 2025, which is due entirely to an increase in revenue resulting from the Orbit Change of Control and Lyocon Acquisition.
Current wording
Revenue. Revenue increased $524,927 during the three months ended June 30, 2026 compared to the same period in 2025, which is due entirely to an increase in revenue resulting from the Orbit Change of Control and Lyocon Acquisition.
Previous wording
Selling and Marketing. Selling and marketing expenses increased $1,434,188 during the three months ended March 31, 2026 compared to the same period in 2025, which includes an insignificant increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, selling and marketing increased $1,434,024. This increase is primarily due to the net effect of (i) an increase in professional and consulting related expenses of approximately $1,096,000, primarily related to an increase in branding and public relations consulting expenses as part of our Transformation Plan, and (ii) an increase in marketing expenses of approximately $385,000, partially offset by (iii) a decrease in depreciation expense of approximately $35,000, due to the write-down of property and equipment to a net book value of zero during the first quarter of 2025. For additional information on the write-down of property and equipment, see Notes 1 and 3 to the condensed consolidated financial statements included herein.
Current wording
Selling and Marketing. Selling and marketing expenses increased $1,055,362 during the three months ended June 30, 2026 compared to the same period in 2025, which includes an insignificant increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, selling and marketing increased $1,051,440. This increase is primarily due to an increase in (i) professional and consulting related expenses of approximately $470,000, primarily related to an increase in branding and public relations consulting expenses as part of our Transformation Plan, (ii) marketing expenses of approximately $360,000, and (iii) stock-based compensation expenses of approximately $185,000, primarily related to an increase in stock-based compensation expense in connection with the Common Stock issued for services provided by non-employee consultants, as discussed further in Note 14 to the condensed consolidated financial statements included herein.
Previous wording
Change in Fair Value of Debt. We recorded a gain of $8,279,246 during the three months ended March 31, 2026, which primarily resulted from (i) a gain of approximately $9,249,000 due to the decrease in fair value of the 2026 Brick Lane H&K Investment Note driven by a decline in our share price from issuance through March 31, 2026, partially offset by a (ii) a loss of approximately $951,000 due to the increase in the fair value of the December 2025 YA Debenture, largely due to an increase in our share price during the three months ended March 31, 2026. We recorded a gain of $256,522 during the three months ended March 31, 2025, which resulted from (i) a gain of $132,508 related to the decrease in the fair value of the Indigo Capital Convertible Notes, largely due to a decrease in the Company's share price from the time of the issuance in early March 2025 through March 31, 2025, and (ii) a gain of $124,014 related to the conversion of $307,320 of contractual principal under the Indigo Capital Exchange Convertible Notes. For additional information, see Notes 7 and 10 to the condensed consolidated financial statements included herein.
Current wording
Change in Fair Value of Debt. We recorded a gain of $393,246 during the three months ended June 30, 2026, which primarily resulted from (i) a gain of approximately $316,000 due to the decrease in the fair value of the December 2025 YA Debenture, largely due to the passage of time and expected near-term settlement during the three months ended June 30, 2026 and (ii) a gain of approximately $76,000 due to the decrease in fair value of the 2026 Brick Lane H&K Investment Note driven by a decline in our share price from issuance through June 30, 2026. We recorded a loss of $1,422,895 during the three months ended June 30, 2025, which primarily relates to an increase in fair value of $1,160,158 of the Indigo Capital Convertible Notes upon conversion of contractual principal of $725,000, largely due to an increase in the Company's share price from March 31, 2025 through the conversion date in May 2025. For additional information, see Notes 7 and 10 to the condensed consolidated financial statements included herein.
Previous wording
Change in Fair Value of Contingent Consideration. We recorded a gain of $300,364 during the three months ended March 31, 2026, which primarily resulted from a gain of approximately $304,000 driven by a decrease in the fair value of the RegTech Contingent Consideration, primarily due to a downward revision of expected future collections used in the earnout calculation based on first-quarter post-acquisition actuals, partially compounded by an increase in the discount rate applied to the expected payments. For additional information, refer to Notes 4 and 7 to the condensed consolidated financial statements included herein.
Current wording
Change in Fair Value of Contingent Consideration. We recorded a loss of $368,523 during the three months ended June 30, 2026, which primarily resulted from a loss of approximately $351,000 driven by an increase in the fair value of the RegTech Contingent Consideration, largely due to an upward revision of expected future collections used in the earnout calculation. For additional information, refer to Notes 4 and 7 to the condensed consolidated financial statements included herein.
Previous wording
Change in Fair Value of Convertible Notes Receivable. We recorded a gain of $1,073,803 during the three months ended March 31, 2026, which primarily relates to the net effect of (i) an increase of approximately $811,000 in the fair value of the Tekne Convertible Note Receivable, primarily due to an increase in our pro-rata equity entitlement upon the Capital Increase resulting from additional fundings under the Tekne
Current wording
Change in Fair Value of Convertible Notes Receivable. We recorded a gain of $288,535 during the three months ended June 30, 2026, which primarily relates to the net effect of (i) an increase of approximately $463,000 in the fair value of the Tekne Convertible Note Receivable, primarily due to (a) an increase in our pro-rata equity entitlement upon the Capital Increase resulting from additional fundings under the Tekne Convertible Note Receivable during the period and (b) interest accrued on the Tekne Convertible Note Receivable during the period of approximately $200,000, which includes interest related to the Network Contract, partially offset by (ii) a decrease of approximately $174,000 in the fair value of the SYME Convertible Note Receivable, primarily due to the net impact of (a) potential dilutive impact on SYME's market value of the expected future conversion of the SYME Convertible Note Receivable into SYME ordinary shares and warrants and (b) interest accrued on the SYME Convertible Note Receivable during the period of approximately $184,000. We recorded a loss of $11,400 during the three months ended June 30, 2025, which relates to the increase in fair value of the SYME Convertible Note Receivable, primarily due to a decrease in the Company's stock price and remaining term to maturity. For additional information, see Note 6 to the condensed consolidated financial statements included herein.
Previous wording
Cost of Revenue. Cost of revenue increased $417,043 during the three months ended March 31, 2026 compared to the same period in 2025, which includes an approximate $653,000 increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, cost of revenue decreased $235,717. This decrease is primarily due to a period-over-period decrease of approximately (i) $120,000 of direct labor and job costs and (ii) $111,000 in overhead, due to continued reduced production volumes following the suspension of laser-system manufacturing operations in 2024, together with further reductions in production-related headcount and overhead during late 2025 and the first quarter of 2026.
Current wording
Cost of Revenue. Cost of revenue increased $1,325,077 during the six months ended June 30, 2026 compared to the same period in 2025, which includes an approximate $1,556,000 increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, cost of revenue decreased $231,179. This decrease is primarily due to a period-over-period decrease of approximately (i) $111,000 in overhead, due to continued reduced production volumes following the suspension of laser-system manufacturing operations in 2024, together with further reductions in production-related headcount and overhead during late 2025 and the first half of 2026 and (ii) $103,000 of direct labor and job costs.
Previous wording
Research and Development. Research and development expenses decreased $117,063 during the three months ended March 31, 2026 compared to the same period in 2025, which is primarily due to decreases in (i) stock-based compensation expenses of approximately $93,000, due primarily to research and development workforce reductions, (ii) depreciation expenses of approximately $41,000 due to the write-down of property and equipment to a net book value of zero during the first quarter of 2025, and (iii) personnel costs of approximately $27,000 due primarily to lower research and development headcount, partially offset by (iv) an increase of approximately $44,000 in research and development spending related to the Maddox Program, which commenced in the first quarter of 2026. For additional information regarding the Maddox Program, see Note 4 to the condensed consolidated financial statements included herein. For additional information on the write-down of property and equipment, see Notes 1 and 3 to the condensed consolidated financial statements included herein.
Current wording
Research and Development. Research and development expenses increased $110,417 during the six months ended June 30, 2026 compared to the same period in 2025, which is primarily due to the net effect of (i) an increase of approximately $265,000 in research and development spending related to the Maddox Program, which commenced in the first quarter of 2026, partially offset by decreases in (ii) stock-based compensation expenses of approximately $93,000, due primarily to research and development workforce reductions, (ii) depreciation expenses of approximately $41,000 due to the write-down of property and equipment to a net book value of zero during the first quarter of 2025, and
Previous wording
General and Administrative. General and administrative expenses increased $3,535,881 during the three months ended March 31, 2026 compared to the same period in 2025, which includes an approximate $91,000 increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, general and administrative increased $3,445,258. This increase is primarily driven by (i) an increase in acquisition-related expenses of approximately $1,054,000, (ii) an increase in personnel costs of approximately $1,002,000 primarily related to an increase in bonus expense paid to executives, (iii) an increase in accounting and audit services of approximately $889,000 related to our Transformation Plan, (iv) an increase in professional and consulting services of approximately $319,000, and (v) an increase in legal expenses of approximately $309,000.
Current wording
General and Administrative. General and administrative expenses increased $3,073,545 during the six months ended June 30, 2026 compared to the same period in 2025, which includes an approximate $163,000 increase due to the Orbit Change of Control and Lyocon Acquisition. Excluding the effects of these transactions, general and administrative increased $2,910,684. This increase is primarily driven by the net effect of (i) an increase in personnel costs of approximately $1,392,000 primarily related to an increase in bonus expense paid to executives, (ii) an increase in accounting and audit services of approximately $929,000 related to our Transformation Plan, (iii) an increase in acquisition-related expenses of approximately $638,000, and (iv) an increase in legal expenses of approximately $457,000, partially offset by (v) a decrease in stock-based compensation expenses of approximately $372,000 due primarily to a reduction in employee headcount during 2025.
Previous wording
Change in Fair Value of Warrant Liabilities. We recorded a gain of $11,396,260 during the three months ended March 31, 2026, which is primarily related to (i) a decrease of approximately $8,975,000 in the fair value of the February 2026 Offering Common Warrants and (ii) a decrease of approximately $2,184,000 in the fair value of the February 2026 Offering Pre-Funded Warrants, each largely due to a decrease in our share price from the time of issuance through March 31, 2026. During the three months ended March 31, 2025, we recorded a gain of $127,300, which largely resulted from a decrease in the Company's share price during the first quarter of 2025.
Current wording
Change in Fair Value of Warrant Liabilities. We recorded a gain of $12,225,675 during the six months ended June 30, 2026, which is primarily related to (i) a decrease of approximately $10,254,000 in the fair value of the February 2026 Offering Common Warrants and (ii) a decrease of approximately $1,963,000 in the fair value of the February 2026 Offering Pre-Funded Warrants, each largely due to a decrease in our share price from the time of issuance through June 30, 2026. We recorded a gain of $110,314 during the six months ended June 30, 2025, which largely resulted from a decrease in the Company's share price between December 31, 2024 and June 30, 2025.
Previous wording
Loss on Issuance of Warrants and Related Costs. We recorded a loss of $8,206,193 during the three months ended March 31, 2026, representing (i) the excess of the initial fair value of the liability-classified February 2026 Offering Warrants over the allocated net proceeds and (ii) the portion of issuance costs allocated to the liability-classified February 2026 Offering Warrants and expensed as incurred, compared to no comparable loss during the three months ended March 31, 2025. For additional information, refer to Note 12 to the condensed consolidated financial statements included herein.
Current wording
Loss on Issuance of Warrants and Related Costs. We recorded a loss of $8,224,691 during the six months ended June 30, 2026, primarily representing (i) the excess of the initial fair value of the liability-classified February 2026 Offering Warrants over the allocated net proceeds and (ii) the portion of issuance costs allocated to the liability-classified February 2026 Offering Warrants and expensed as incurred, compared to no comparable loss during the six months ended June 30, 2025. For additional information, refer to Note 12 to the condensed consolidated financial statements included herein.
Previous wording
Loss on Issuance of Debt. We recorded a loss of $11,661,274 during the three months ended March 31, 2026, representing the excess of the issuance date fair value of the 2026 Brick Lane H&K Investment Note over the fair value of the H&K Investment received in exchange. We recorded a loss of $707,800 during the three months ended March 31, 2025 related to the excess of the initial fair value of $2,207,800 of the Indigo Capital Convertible Note over the proceeds received. For additional information, see Note 10 to the condensed consolidated financial statements included herein.
Current wording
Loss on Issuance of Debt. We recorded a loss of $11,661,274 during the six months ended June 30, 2026, representing the excess of the issuance date fair value of the 2026 Brick Lane H&K Investment Note over the fair value of the H&K Investment received in exchange. We recorded a loss of $1,474,096 during the six months ended June 30, 2025, primarily related to (i) an aggregate excess of $707,800 in the initial fair value of the 2025 Indigo Capital Convertible Notes over the proceeds received during the first quarter of 2025 and (ii) an aggregate excess of $617,693 in the initial fair value of certain of the 2025 Indigo Capital Convertible Notes, 2025 Diagonal Convertible Notes and 2025 Brick Lane Convertible Notes over the proceeds received during the second quarter of 2025. For additional information, see Note 10 to the condensed consolidated financial statements included herein.
Previous wording
Change in Fair Value of Derivative Liability. We recorded a gain of $4,909,820 during the three months ended March 31, 2026, related to the remeasurement of the amended Orbit Preferred Obligation upon stockholder approval of the share issuance in March 2026, compared to a gain of $37,900 during the three months ended March 31, 2025. For additional information, refer to Note 4 to the condensed consolidated financial statements included herein.
Current wording
Change in Fair Value of Derivative Liability. We recorded a gain of $4,909,820 during the six months ended June 30, 2026, related to the remeasurement of the amended Orbit Preferred Obligation upon stockholder approval of the share issuance in March 2026, compared to a gain of $37,900 during the six months ended June 30, 2025 related to the extinguishment of the August 2024 Convertible Notes. For additional information, refer to Note 4 to the condensed consolidated financial statements included herein.
Previous wording
Convertible Note Receivable during the period, (ii) interest accrued on the Tekne Convertible Note Receivable during the period of approximately $307,000, which includes interest related to the Network Contract, partially offset by (iii) a decrease of approximately $219,000 in the fair value of the SYME Convertible Note Receivable, primarily due to the potential dilutive impact on SYME's market value of the expected future conversion of the SYME Convertible Note Receivable into SYME ordinary shares and warrants. For additional information, see Note 6 to the condensed consolidated financial statements included herein.
Current wording
Change in Fair Value of Convertible Notes Receivable. We recorded a gain of $1,362,338 during the six months ended June 30, 2026, which primarily relates to the net effect of (i) an increase of approximately $1,755,000 in the fair value of the Tekne Convertible Note Receivable, primarily due to (a) an increase in our pro-rata equity entitlement upon the Capital Increase resulting from additional fundings under the Tekne Convertible Note Receivable during the period and (b) interest accrued on the Tekne Convertible Note Receivable during the period of approximately $331,000, which includes interest related to the Network Contract, partially offset by (ii) a decrease of approximately $393,000 in the fair value of the SYME Convertible Note Receivable, primarily due to the net impact of (a) the potential dilutive impact on SYME's market value of the expected future conversion of the SYME Convertible Note Receivable into SYME ordinary shares and warrants and (b) interest accrued on the SYME Convertible Note Receivable during the period of approximately $366,000. We recorded a loss of $11,400 during the six months ended June 30, 2025, which relates to the increase in fair value of the SYME Convertible Note Receivable, primarily due to a decrease in the Company's stock price and remaining term to maturity. For additional information, see Note 6 to the condensed consolidated financial statements included herein.
Previous wording
Remeasurement of Subscription for Orbit Shares. We recorded a gain of $1,189,837 during the three months ended March 31, 2026 related to the remeasurement of our subscription right for additional shares of Orbit to its acquisition-date fair value in connection with the Orbit Change of Control, primarily due to the increase in our share price between the inception of the Orbit Preferred Obligation and the Orbit Change of Control date. For additional information, refer to Note 4 to the condensed consolidated financial statements included herein.
Current wording
Remeasurement of Subscription for Orbit Shares. We recorded a gain of $1,189,837 during the six months ended June 30, 2026 related to the remeasurement of our subscription right for additional shares of Orbit to its acquisition-date fair value in connection with the Orbit Change of Control, primarily due to the increase in our share price between the inception of the Orbit Preferred Obligation and the Orbit Change of Control date. For additional information, refer to Note 4 to the condensed consolidated financial statements included herein.
Previous wording
Change in Fair Value of SEPA Liability. We recorded a gain of $228,935 during the three months ended March 31, 2026 related to the decrease in the fair value of the SEPA liability, primarily due to changes in the expected timing and amount of remaining dollar draws under the SEPA.
Current wording
Change in Fair Value of SEPA Liability. We recorded a gain of $1,473,349 during the six months ended June 30, 2026 related to the decrease in the fair value of the SEPA liability, primarily due to changes in the expected timing and amount of remaining dollar draws under the SEPA. We recorded a loss of $260,507 during the six months ended June 30, 2025 related to the increase in the fair value of the SEPA liability, primarily due to the increase in the fair value of the put option.
Previous wording
Gain on Sale of Intellectual Property Intangible Assets. We recorded a gain on the sale of intellectual property of $8,961,872 during the three months ended March 31, 2025, which primarily related to the sale of collateral to extinguish the remaining outstanding Junior Notes and Senior Convertible Notes, as further described in Note 10 to the condensed consolidated financial statements included herein.
Current wording
Gain on Sale of Intellectual Property Intangible Assets. We recorded a gain on the sale of intellectual property of $8,961,872 during the six months ended June 30, 2025, which primarily related to the sale of collateral to extinguish the remaining outstanding Junior Notes and Senior Convertible Notes, as further described in Note 10 to the condensed consolidated financial statements included herein.
Previous wording
Loss on Impairment of Inventories, Property and Equipment and Operating Lease Right-of-Use Asset. We recorded a loss on impairment of inventories, property and equipment and operating lease right-of-use asset of $6,064,823 during the three months ended March 31, 2025 related to write-downs and impairments recorded on our inventories, property and equipment and right-of-use asset in connection with our default under our lease in Centennial, Colorado, and ultimate judgment obtained by the landlord, in April 2025. For additional information, see Notes 1, 3, and 8 to the condensed consolidated financial statements included herein.
Current wording
Loss on Impairment of Inventories, Property and Equipment and Operating Lease Right-of-Use Asset. We recorded a loss on impairment of inventories, property and equipment and operating lease right-of-use asset of $6,064,823 during the six months ended June 30, 2025 related to write-downs and impairments recorded on our inventories, property and equipment and right-of-use asset in connection with our default under our lease in Centennial, Colorado, and ultimate judgment obtained by the landlord, in April 2025. For additional information, see Notes 1, 3, and 8 to the condensed consolidated financial statements included herein.
Previous wording
Interest Expense Recognized on Remeasurement of Preferred Stock Liability. We recorded non-cashi nterest expense of $10,398,050 during the three months ended March 31, 2025 related to the subsequent remeasurement of the preferred stock liability after issuance through March 31, 2025 in connection with the reclassification of the preferred stock from mezzanine equity to a current liability on January 31, 2025. For additional information, see Note 11 to the condensed consolidated financial statements included herein.
Current wording
Interest Expense Recognized on Remeasurement of Preferred Stock Liability. We recorded non-cashi nterest expense of $10,398,050 during the six months ended June 30, 2025 related to the subsequent remeasurement of the preferred stock liability after issuance through March 31, 2025 in connection with the reclassification of the preferred stock from mezzanine equity to a current liability on January 31, 2025. For additional information, see Note 11 to the condensed consolidated financial statements included herein.
Previous wording
As of March 31, 2026, we had cash and cash equivalents of $8,267,110 as compared to $24,661,284 as of December 31, 2025. During the three months ended March 31, 2026, our principal sources of liquidity were gross cash proceeds of (i) $11,994,929 related to the February 2026 Offering, as further described in Note 11 to the condensed consolidated financial statements, (ii) $2,172,771 under the SEPA, as further described in Note 13 to the condensed consolidated financial statements, and (iii) $764,018 of proceeds from warrant exercises. Our cash flows from operations are not sufficient to fund our current operating model and expansion plans. As of January 31, 2025, we were also required to redeem the Preferred Stock as permitted by law in cash at an amount equal to $10.00 per share. Notwithstanding the foregoing, we are not required to redeem any shares of Preferred Stock to the extent we do not have legally available funds to effect such redemption.
Current wording
As of June 30, 2026, we had cash and cash equivalents of $726,934 as compared to $24,661,284 as of December 31, 2025. During the six months ended June 30, 2026, our principal sources of liquidity were gross cash proceeds of (i) $11,994,929 related to the February 2026 Offering, as further described in Note 11 to the condensed consolidated financial statements, (ii) $10,996,535 under the SEPA, as further described in Note 13 to the condensed consolidated financial statements, and (iii) $765,061 of proceeds from warrant exercises. Additionally, in July 2026, we received net proceeds from the July 2026 Offering of approximately $18,738,864 after the repayment in full of all outstanding principal and accrued interest under the December 2025 YA Debenture and the Lyocon Convertible Notes. Our cash flows from operations are not sufficient to fund our current operating model and expansion plans. As of January 31, 2025, we were also required to redeem the Series A Preferred Stock as permitted by law in cash at an amount equal to $10.00 per share. Notwithstanding the foregoing, we are not required to redeem any shares of Series A Preferred Stock to the extent we do not have legally available funds to effect such redemption.
Previous wording
From inception through March 31, 2026, we have incurred operating losses and negative cash flows from operating activities. For the three months ended March 31, 2026 and 2025, we have incurred net losses of $459,898 and $16,611,425, respectively, and we have an accumulated deficit of $200,939,729 as of March 31, 2026. The net loss for the three months ended March 31, 2025 included $10,398,050 of non-cash interest expense recognized on remeasurement of the preferred stock liability. For additional information on this interest expense, see Note 11 to the condensed consolidated financial statements included herein.
Current wording
From inception through June 30, 2026, we have incurred operating losses and negative cash flows from operating activities. For the three months ended June 30, 2026 and 2025 and six months ended June 30, 2026 and 2025, the Company has incurred net losses of $6,475,862 and $12,224,975, respectively, and $6,935,760 and $28,836,400, respectively, and the Company has an accumulated deficit of $207,415,591 as of June 30, 2026. The net loss for the six months ended June 30, 2025 included $10,398,050 of non-cash interest expense recognized on remeasurement of the preferred stock liability. For additional information on this interest expense, see Note 11 to the condensed consolidated financial statements included herein.
Previous wording
Until we can generate sufficient revenue, we plan to finance our business with the proceeds from the issuance and sale of debt or equity securities, including sales pursuant to the SEPA, or borrowings under credit facilities. There is no assurance our management's plans to obtain additional debt or equity financing or credit facilities will be successfully implemented or implemented on terms favorable to us.
Current wording
Until we can generate sufficient revenue, we plan to finance our business with the proceeds from the issuance and sale of debt or equity securities, including sales pursuant to the SEPA (which are not currently permitted due to the suspension of trading of the Common Stock on NYSE American), or borrowings under credit facilities. There is no assurance our management's plans to obtain additional debt or equity financing or credit facilities will be successfully implemented or implemented on terms favorable to us.
Previous wording
Net cash used in operating activities was $9,105,949 and $1,927,792 for the three months ended March 31, 2026 and 2025, respectively. The increase in cash used from operating activities is primarily the result of the net effect of (i) a net increase in cash used from non-cash expenses of $21,370,894 including (a) an increase in cash used from an increase in the gain on change in fair value of warrant liabilities of $11,268,960, (b) a decrease in cash used related to the increase in the loss on issuance of debt of $10,953,474, (c) an increase in cash used from the interest expense recognized on remeasurement of preferred stock liability of $10,398,050 that was recognized during the three months ended March 31, 2025, (d) a decrease in cash used due to the decrease in the gain on sale of intellectual property intangible assets of $8,961,872 that was recognized during the three months ended March 31, 2025, (e) an increase in cash used due to an increase in the gain related to the change in fair value of debt of $8,022,724, (f) a decrease in cash used due to the loss on issuance of warrants and related costs of $8,206,193 recorded during the three months ended March 31, 2026, (g) an increase in cash used due to the loss on impairment of inventories, property and equipment and operating lease right-of-use asset of $6,064,823 recognized during the three months ended March 31, 2025, (h) an increase in cash used due to the loss on extinguishment of debt of $5,497,516 recognized during the three months ended March 31, 2025 and (i) an increase in cash used due to the increase in the gain related to the change in fair value of derivative liability of $4,871,920, (ii) a decrease in cash used from a decrease in net loss of $16,151,527 and (iii) an increase in cash used from a change in working capital of $1,958,790.
Current wording
Net cash used in operating activities was $15,098,163 and $3,986,504 for the six months ended June 30, 2026 and 2025, respectively. The increase in cash used from operating activities is primarily the result of the net effect of (i) a net increase in cash used from non-cash expenses of $28,372,496 including (a) an increase in cash used from an increase in the gain on change in fair value of warrant liabilities of $12,115,361, (b) an increase in cash used from the interest expense recognized on remeasurement of preferred stock liability of $10,398,050 that was recognized during the six months ended June 30, 2025, (c) a decrease in cash used related to the increase in the loss on issuance of debt of $10,187,178, (d) an increase in cash used due to the change in fair value of debt of $9,838,865, (e) a decrease in cash used due to the decrease in the gain on sale of intellectual property intangible assets of $8,961,872 that was recognized during the six months ended June 30, 2025, (f) a decrease in cash used due to the loss on issuance of warrants and related costs of $8,224,691 recorded during the six months ended June 30, 2026, (g) an increase in cash used due to the loss on extinguishment of debt of $6,873,335 recognized during the six months ended June 30, 2025, (h) an increase in cash used due to the loss on impairment of inventories, property and equipment and operating lease right-of-use asset of $6,064,823 recognized during the six months ended June 30, 2025, and (i) an increase in cash used due to the increase in the gain related to the change in fair value of derivative liability of $4,871,920, (ii) a decrease in cash used from a decrease in net loss of $21,900,640 and (iii) an increase in cash used from a change in working capital of $4,639,803.
Previous wording
Net cash used in investing activities was $19,366,330 and $750,000 for the three months ended March 31, 2026 and 2025, respectively. The amount used in investing activities for the three months ended March 31, 2026 relates to (i) $18,075,510 of payments under the SYME Convertible Note Receivable and Tekne Convertible Note Receivable, (ii) $749,905 of cash paid for the Lyocon Acquisition, net of cash acquired, and (iii) $540,915 of cash paid for the acquisition of a controlling financial interest in Orbit, net of cash acquired. The amount used in investing activities for the three months ended March 31, 2025 relates to $600,000 of cash paid for the deposit on the anticipated acquisition of Trumar Capital LLC and $150,000 of payments under the SYME Convertible Note Receivable.
Current wording
Net cash used in investing activities was $21,807,937 and $1,250,000 for the six months ended June 30, 2026 and 2025, respectively. The amount used in investing activities for the six months ended June 30, 2026 relates to (i) $20,511,875 of payments under the SYME Convertible Note Receivable and Tekne Convertible Note Receivable, (ii) $749,905 of cash paid for the Lyocon Acquisition, net of cash acquired, and (iii) $540,915 of cash paid for the acquisition of a controlling financial interest in Orbit, net of cash acquired. The amount used in investing activities for the six months ended June 30, 2025 relates to (i) $650,000 of payments under the SYME Convertible Note Receivable and (ii) $600,000 of cash paid for the deposit on the anticipated acquisition of Trumar Capital LLC.
Previous wording
Net cash provided by financing activities during the three months ended March 31, 2026 is comprised primarily of (i) $11,994,929 of proceeds from the February 2026 Offering, as further described in Note 11 to the condensed consolidated financial statements included herein, (ii) $2,172,771 of proceeds from the SEPA, partially offset by a decrease in cash provided of (iii) $1,712,314 from repayments of debt and (iv) $1,137,116 from payments of debt and equity issuance costs.
Current wording
Net cash provided by financing activities during the six months ended June 30, 2026 is comprised primarily of an increase in cash provided related to (i) $11,994,929 of proceeds from the February 2026 Offering, as further described in Note 11 to the condensed consolidated financial statements included herein and (ii) $10,996,535 of proceeds from the SEPA, partially offset by a decrease in cash provided of (iii) $9,624,733 from repayments of debt and (iv) $1,155,614 from payments of debt and equity issuance costs.
Previous wording
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of March 31, 2026. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements, other than our variable interest in SYME 3, an unconsolidated variable interest entity described in Note 4 to the condensed consolidated financial statements included herein. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Current wording
We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of June 30, 2026. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements, other than our variable interest in SYME 3, an unconsolidated variable interest entity described in Note 4 to the condensed consolidated financial statements included herein. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Previous wording
In connection with the business combinations, fair value option elections, and other significant transactions completed during the three months ended March 31, 2026 described within the condensed consolidated financial statements, we have identified additional critical accounting estimates relating to (i) business combinations, including the determination of fair value of identifiable assets acquired, liabilities assumed and contingent consideration as of the acquisition date, (ii) the assessment of impairment of goodwill and intangible assets and (iii) the subsequent remeasurement of contingent consideration liabilities. We expect to provide a full discussion of these matters as critical accounting estimates in our Annual Report on Form 10-K for the year ending December 31, 2026. Other than the foregoing, there have been no significant changes to our accounting policies during the three months ended March 31, 2026, as compared to the critical accounting policies described in our audited financial statements included in the Annual Report.
Current wording
In connection with the business combinations, fair value option elections, and other significant transactions completed during the six months ended June 30, 2026 described within the condensed consolidated financial statements, we have identified additional critical accounting estimates relating to (i) business combinations, including the determination of fair value of identifiable assets acquired, liabilities assumed and contingent consideration as of the acquisition date, (ii) the assessment of impairment of goodwill and intangible assets and (iii) the subsequent remeasurement of contingent consideration liabilities. We expect to provide a full discussion of these matters as critical accounting estimates in our Annual Report on Form 10-K for the year ending December 31, 2026. Other than the foregoing, there have been no significant changes to our accounting policies during the six months ended June 30, 2026, as compared to the critical accounting policies described in our audited financial statements included in the Annual Report.
Rearranged current paragraphs (9)
Current report — wording carried from elsewhere
Trading of our Common Stock was halted by NYSE American on February 13, 2026, because the trading price dropped below NYSE American’s Minimum Trading Price of $0.10.
Current report — wording carried from elsewhere
Orbit. We had no revenue during the three and six months ended June 30, 2025. For additional information, refer to Notes 2 and 9 to the condensed consolidated financial statements included herein.
Current report — wording carried from elsewhere
Research and Development. Research and development expenses increased $227,480 during the three months ended June 30, 2026 compared to the same period in 2025, which is primarily due to an increase of approximately $221,000 in research and development spending related to the Maddox Program, which commenced in the first quarter of 2026. For additional information regarding the Maddox Program, see Note 4 to the condensed consolidated financial statements included herein.
Current report — wording carried from elsewhere
Change in Fair Value of SEPA Liability. We recorded a gain of $1,244,414 during the three months ended June 30, 2026 related to the decrease in the fair value of the SEPA liability, primarily due to changes in the expected timing and amount of remaining dollar draws under the SEPA. We recorded a loss of $260,507 during the three months ended June 30, 2025 related to the increase in the fair value of the SEPA liability, primarily due to the increase in the fair value of the put option. For additional information, refer to Notes 7 and 13 to the condensed consolidated financial statements included herein.
Current report — wording carried from elsewhere
The following table sets forth our results of operations for the six months ended June 30, 2026 and 2025:
Current report — wording carried from elsewhere
Revenue. Revenue increased $932,571 during the six months ended June 30, 2026 compared to the same period in 2025, which is due entirely to an increase in revenue resulting from the Orbit Change of Control and Lyocon Acquisition.
Current report — wording carried from elsewhere
(iii) personnel costs of approximately $27,000 due primarily to lower research and development headcount. For additional information regarding the Maddox Program, see Note 4 to the condensed consolidated financial statements included herein. For additional information on the write-down of property and equipment, see Notes 1 and 3 to the condensed consolidated financial statements included herein.
Current report — wording carried from elsewhere
Change in Fair Value of Debt. We recorded a gain of $8,672,492 during the six months ended June 30, 2026, which primarily resulted from (i) a gain of approximately $9,325,000 due to the decrease in fair value of the 2026 Brick Lane H&K Investment Note driven by a decline in our share price from issuance through June 30, 2026, partially offset by a (ii) a loss of approximately $635,000 due to the net increase in the fair value of the December 2025 YA Debenture, as the expected repayment shifted to the near term, shortening the expected term and partially reducing the fair value later in the period. We recorded a loss of $1,166,373 during the six months ended June 30, 2025, which resulted from (i) a loss due to the increase in fair value of $1,160,158 of the Indigo Capital Convertible Notes upon conversion of contractual principal of $725,000, largely due to an increase in the Company's share price from March 31, 2025 through the conversion date in May 2025, (ii) a gain of $132,508 related to the decrease in the fair value of the Indigo Capital Convertible Notes, largely due to a decrease in the Company's share price from the time of the issuance in early March 2025 through March 31, 2025, and (ii) a gain of $124,014 related to the conversion of $307,320 of contractual principal under the 2025 Indigo Capital Convertible Notes. For additional information, see Notes 7 and 10 to the condensed consolidated financial statements included herein.
Current report — wording carried from elsewhere
Change in Fair Value of Contingent Consideration. We recorded a loss of $68,159 during the six months ended June 30, 2026, which primarily resulted from (i) a loss of approximately $47,000 driven by an increase in the fair value of the RegTech Contingent Consideration, primarily due to a downward revision of expected volatility of future collections used in the earnout calculation, partially compounded by a decrease in the discount rate applied to the future collections and (ii) a loss of approximately $21,000 driven by an increase in the fair value of the Lyocon Contingent Consideration, primarily due to the passage of time to settlement, partially offset by an increase in the discount rate applied to the expected payments. For additional information, refer to Notes 4 and 7 to the condensed consolidated financial statements included herein.