FiscalNote Holdings, Inc.

Notes to the Condensed Consolidated Financial Statements

(in thousands, except shares, par value, per share amounts, or as otherwise noted)

Note 1. Summary of Business and Significant Accounting Policies

Description of Business

FiscalNote delivers deep expertise in legislative tracking, regulatory analysis, and stakeholder engagement through PolicyNote, our flagship platform. Built to ensure a complete, real-time view of the policy landscape, PolicyNote delivers extensive policy data integrated with AI-powered monitoring and expert analysis, fueled by the trusted reporting of CQ and Roll Call, and coupled with the grassroots mobilization power of VoterVoice. Our PolicyNote suite rapidly provides users with the clarity on the policy landscape needed to make an impact. In our core products, we ingest unstructured data on legislative and regulatory developments, and overlay that data with our sophisticated in-house AI and data science expertise to deliver structured, relevant and actionable information that facilitates and informs our customers’ key operational and strategic decisions. In addition, as the way organizations consume policy data and analysis changes, we are leveraging our policy domain expertise to expand into political prediction markets and enhancing our API offerings to enable organizations to incorporate our policy intelligence directly into their internally-developed systems.

As a historical explanatory note, on July 29, 2022, the Company consummated the transactions contemplated by the Agreement and Plan of Merger, dated as of November 7, 2021, and as amended on May 9, 2022, (the “Merger Agreement”), by and among FiscalNote Holdings, Inc., a Delaware corporation (“Old FiscalNote”), Duddell Street Acquisition Corp., a Cayman Islands exempted company (“DSAC”), and Grassroots Merger Sub, Inc., a Delaware Corporation and a wholly owned direct subsidiary of DSAC (“Merger Sub” and, together with DSAC, the “DSAC Parties”). Pursuant to these transactions, Merger Sub merged with and into Old FiscalNote, with Old FiscalNote becoming a wholly owned subsidiary of DSAC (the “Business Combination” and, collectively with the other transactions described in the Business Combination Agreement, the “Transactions”). In connection with the closing of the Transactions (the “Closing”), DSAC domesticated and continued as a Delaware corporation under the name of “FiscalNote Holdings, Inc. ” (“New FiscalNote”). Unless the context otherwise requires, references in this Quarterly Report on Form 10-Q to the “Company, ” “FiscalNote, ” “we, ” “us, ” or “our” refer to the business of Old FiscalNote, which became the business of New FiscalNote and its subsidiaries following the Closing.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances have been eliminated in consolidation.

These condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the financial information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of the Company’s management, the unaudited condensed consolidated financial statements include all adjustments necessary for the fair presentation of the Company’s balance sheet and its results of operations, including its comprehensive loss, temporary equity, stockholders' equity (deficit), and cash flows. All adjustments are of a normal recurring nature. The results for the nine months ended September 30, 2026 are not necessarily indicative of the results to be expected for any subsequent quarters or for the fiscal year ending December 31, 2026. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.

Reverse Stock Split

On August 22, 2025, the Board approved a 1-for-12 reverse stock split (the “Reverse Stock Split”) of the Company’s Common Stock. On August 28, 2025, the Company filed a certificate of amendment to its Certificate of Incorporation (as amended from time to time, the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware to effect the Reverse Stock Split, and the Company’s Class A Common Stock began trading on a split-adjusted basis at market open on September 2, 2025 under the existing symbol “NOTE”.

As a result of the Reverse Stock Split, every 12 shares of the Company’s Common Stock issued and outstanding as of the effective time of the Reverse Stock Split were automatically converted into one share of Common Stock. No fractional shares were issued in connection with the Reverse Stock Split. Instead, each stockholder received a cash payment in lieu thereof at a price equal to the fraction of one share to which the stockholder would otherwise be entitled multiplied by the closing price per share of Class A Common Stock (as adjusted for the Reverse Stock Split) on the New York Stock Exchange (“NYSE”) on August 29, 2025, the last trading day immediately preceding the effective time of the Reverse Stock Split.

Further, proportionate adjustments were made to the number of shares of Common Stock underlying the Company’s outstanding equity awards and the number of shares issuable under the Company’s equity incentive plans and existing agreements, as well as the exercise price and/or any stock price goals, as applicable. The Reverse Stock Split did not affect the number of authorized shares of Common Stock or the par value of the Common Stock. The Company’s publicly traded warrants are now traded on the OTCID Basic Market. However, pursuant to the terms of the applicable warrant agreement, the number of shares of Class A Common Stock issuable on exercise of each warrant was proportionately decreased. Specifically, following effectiveness of the Reverse Stock Split, every warrant to purchase 1.571428 shares of Class A Common Stock (the exchange ratio in place immediately prior to the Reverse Stock Split) now represents the right to purchase 0.130952 shares of Class A Common Stock. Accordingly, the effective per share exercise price is $87.82.

All share and per share amounts in the accompanying condensed consolidated financial statements have been retroactively adjusted to reflect the Reverse Stock Split for all periods presented.

Liquidity and Going Concern

In accordance with Accounting Standards Codification Topic 205-40, Going Concern, the Company evaluates whether there are certain conditions and events, when considered in the aggregate, which raise substantial doubt about the Company’s ability to continue as a going concern.

The Company’s cash, cash equivalents, restricted cash, and short-term investments were$10,844 at September 30, 2026, compared with$26,947 at December 31, 2025. Further, the Company had a negative working capital balance of$120,001 (excluding cash and short-term investments) at September 30, 2026 and had an accumulated deficit of$949,474 and$872,146 as of September 30, 2026 and December 31, 2025, respectively, and incurred net losses of$76,408 and of$58,961 (excluding the effect of the loss (gain) on sale of businesses) for the nine months ended September 30, 2026 and 2025, respectively. Historically, the Company’s cash flows from operations have not been sufficient to fund its current operating model and the Company partially funded its operations through raising equity and debt and selling assets (see Note 3, Dispositions).

On January 31, 2026 the Company did not meet its 2025 Senior Term Loan minimum annualized recurring revenue financial covenant requirement. On March 23, 2026, the Company entered into Amendment No. 1 of the 2025 Senior Term Loan, which among other things, (a) waived the event of default arising from the Company’s failure to satisfy the annualized recurring revenue covenant at January 31, 2026, (b) revised the minimum thresholds for annualized recurring revenue and consolidated adjusted EBITDA and reduced minimum liquidity requirements through March 31, 2027, (c) revised the Company’s interest and principal repayment requirements, and (d) require the Company to prepay $20,000 of principal no later than March 31, 2027. (See Note 7, Debt for additional details). If the Company does not amend its financial covenants under the 2025 Senior Term Loan before April 1, 2027, it is probable the Company will not be able to meet its then-required financial covenants.

On April 13, 2026, the Company’s Class A common stock and warrants, each exercisable for 0.130952 shares of Class A common stock at an exercise price of $11.50 per whole warrant (an effective price of $87.82 per share), were delisted from the NYSE. The NYSE delisting caused events of default under the YA Convertible Notes and the 2025 GPO Convertible Note (together, the “Subordinated Notes”). On April 21, 2026, the Company entered into forbearance agreements with each of GPO FN Noteholder, LLC (“GPO”) and YA II PN, Ltd (together with GPO, the “Subordinated Creditors”), which were extended on each of May 18, 2026, June 24, 2026 and July 22, 2026, pursuant to which the Subordinated Creditors agreed to waive defaults under the terms of subordinated convertible debt instruments issued to the Subordinated Creditors arising from the NYSE delisting, and to forbear from exercising any rights relating to such defaults, until August 21, 2026. The aforementioned forbearance agreements expired on August 22, 2026 and the Company is in default under the Subordinated Notes; accordingly, the Company is also in default of its 2025 Senior Term Loan due to the cross-default provision within the 2025 Senior Term Loan.

At September 30, 2026 the Company did not meet its (a) minimum Annual Recurring Revenue financial covenant; (b) minimum cash balance; and (c) minimum Adjusted EBITDA covenant requirement for the twelve month period ending September 30, 2026; all of which have not been waived, and as of the date of this filing the 2025 Senior Term Loan lenders have not exercised their default rights, which could include the immediate repayment of the amount outstanding under the 2025 Senior Term Loan.

These conditions, considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern and meet the Company’s obligations as they become due within one year after the date the financial statements are issued.

In response to the foregoing conditions, management is focused on developing plans intended to alleviate the substantial doubt about the Company’s ability to continue as a going concern such as: renegotiating or amending existing debt obligations, to extend maturities, early convert the Subordinated Notes, or otherwise restructure repayment terms; and pursuing the sale of assets or business units to generate liquidity and reduce outstanding indebtedness. Management’s plans must also generate sufficient cash to, among other things, fund the Company’s operations, while also maintaining compliance with its liquidity covenant, and fulfill the remaining $15,049 principal prepayment required pursuant to Amendment No. 1 of the 2025 Senior Term Loan which is due no later than March 31, 2027; which at this time the Company has no ability to satisfy. In addition, we are focused on implementing various cost saving measures such as the possible termination of certain non-essential operations, a reduction in spending on certain operations, thedeferral or termination of certain contractual obligations, and the possible deregistration of the Company's securities or other suspension of the Company’s reporting obligations under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company’s Class A Common Stock and public warrants are currently traded on the OTCID Basic Market.

If the Company raises funds in the future by issuing equity securities, dilution to stockholders will occur and may be substantial. Any equity securities issued may also provide for rights, preferences, or privileges senior to those of holders of common stock. If the Company raises funds in the future by issuing additional debt securities, these debt securities could have rights, preferences, and privileges senior to those of common stockholders. The terms of any additional debt securities, borrowings, and/or debt amendments could impose significant restrictions on the Company’s operations. The capital markets have experienced in the past, and may experience in the future, periods of upheaval that could impact the availability and cost of equity and debt financing. There can be no assurance that any necessary additional financing in the future will be available on terms acceptable to the Company, or at all.

There is no assurance that any of management’s plans will be pursued or achieve the intended results and at this time management has concluded that its current plans do not alleviate substantial doubt, as there can be no assurance that any of these plans will be successfully implemented on acceptable terms, or at all. If pursuit of any strategic plan is unsuccessful, our Board may decide or be required by our creditors to seek relief under the US Bankruptcy Code. In the event of a bankruptcy, we do not expect there to be sufficient assets to fully satisfy all creditors, in which case the holders of Common Stock and warrants would lose all or substantially all of their investment.

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

Segments

The Company is a leading provider of artificial intelligence ("AI") driven global policy and regulatory intelligence solutions and operates out of asingle operating segment. The Company derives revenues from customers by delivering critical, actionable legal and policy insights in a rapidly evolving political, regulatory and macroeconomic environment.

The Company's chief operating decision maker ("CODM") is the chief executive officer. The chief operating decision maker assesses performance for the single operating segment and decides how to allocate resources based on net (loss) income that also is reported on the income statement as consolidated net (loss) income. The measure of segment assets is reported on the balance sheet as total consolidated assets. The Company does not have intra-equity sales or transfers. The Company operates as a single operating segment as the chief operating decision maker manages the business activities on a consolidated basis.

The primary financial measures used by the CODM to evaluate performance and allocate resources are net income (loss) and operating income (loss). The CODM uses net income (loss) and operating income (loss) to evaluate the performance of the Company's ongoing operations and as part of the Company's internal planning and forecasting processes. Information on net income (loss) and operating income (loss) is disclosed in the condensed consolidated statements of operations and comprehensive income (loss). Segment expenses and other segment items are provided to the CODM on the same basis as disclosed in the condensed consolidated statements of operations and comprehensive income (loss).

The CODM does not evaluate performance or allocate resources based on assets of thesingle segment, and therefore such information is not presented in the notes to the financial statements.

Earnings per Share

Basic earnings per share ("EPS") is calculated by dividing the net income or loss available to common stockholders by the weighted average number of shares of common stock outstanding for the period without consideration for common stock equivalents. Diluted EPS is computed by dividing the net income or loss available to common stockholders by the weighted average number of shares of common stock outstanding for the period and the weighted average number of dilutive common stock equivalents outstanding for the period determined using the if-converted method (convertible debt instruments) or treasury-stock method (warrants and share-based payment arrangements). For purposes of this calculation, common stock issuable upon conversion of debt, options and warrants are considered to be common stock equivalents and are only included in the calculation of diluted earnings per share when their effect is dilutive.

Fair Value of Financial Instruments

The Company has elected the fair value option for the 2025 GPO Convertible Note, GPO Convertible Note, Dragonfly Seller Convertible Notes, Convertible Debentures and the Era Convertible Notes, refer to Note 7, Debt for further details. The Company records changes in fair value through the condensed consolidated statement of operations where the portion of the change that results from a change in the instrument-specific credit risk is recorded separately in accumulated other comprehensive income, if applicable. Additionally, under the fair value option, all issuance costs are expensed in the period that the debt is incurred.

Investments

The Company has invested in highly liquid investments that have investment-grade ratings. These investments are accounted for at fair value through the condensed consolidated statement of operations. The Company is able to easily liquidate these into cash; accordingly, the Company has presented these investments as available for current operations and they are presented as short-term investments within current assets in the condensed consolidated balance sheets. Purchases and sales of short-term investments are classified in the investing section of our consolidated statement of cash flows.

Concentrations of Risks

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. The Company generally maintains its cash and cash equivalents with various nationally recognized financial institutions. The Company’s cash and cash equivalents at times exceed amounts guaranteed by the Federal Deposit Insurance Corporation. The Company considers cash on deposit and all highly liquid investments with original maturities of three months or less to be cash and cash equivalents. At September 30, 2026, approximately 65% of the Company’s cash, cash equivalents, and restricted cash were held at a single bank.

The Company does not require collateral for accounts receivable. The Company maintains an allowance for its doubtful accounts receivable due to estimated credit losses. This allowance is based upon historical loss patterns, the number of days billings are past due, collection history of each customer, an evaluation of the potential risk of loss associated with delinquent accounts and current market conditions and reasonable and supportable forecasts of future economic conditions to inform adjustments to historical loss patterns. The Company records the allowance against bad debt expense through the condensed consolidated statements of operations and comprehensive income (loss), included in sales and marketing expense, up to the amount of revenues recognized to date. Any incremental allowance is recorded as an offset to deferred revenue on the condensed consolidated balance sheets. Receivables are written off and charged against the recorded allowance when the Company has exhausted collection efforts without success. As of September 30, 2026 and December 31, 2025, allowance for credit losses of$1,274 and$1,454, respectively, was included in the accounts receivable, net balance.

No single customer accounted for more than 10% of the Company's accounts receivable balance as of September 30, 2026 and December 31, 2025. Revenues derived from the U.S. Federal Government were 20% and 17% of revenues for the nine months ended September 30, 2026 and 2025, respectively. As of September 30, 2026 and December 31, 2025, assets located in the United States were approximately 98% and 99% of total assets, respectively.

As of September 30, 2026, three vendors individually accounted for more than 10% of the Company's accounts payable balance. As of December 31, 2025, one vendor accounted for more than 10% of the Company's accounts payable balance. During the nine months ended September 30, 2026, one vendor represented more than 10% of the total purchases made. During the nine months ended September 30, 2025, no vendors represented more than 10% of the total purchases made.

Recent Accounting Pronouncements Not Yet Effective

In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") ASU 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) as amended by ASU 2025-01, which requires public entities to disclose disaggregated information about certain income statement line items in the notes to the financial statements. For public entities, ASU 2024-03 is required to be adopted for annual periods beginning after December 15, 2026 and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.

In September 2025, the FASB issued ASU No. 2025-06 Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removed the language around project stages that was used to assess when costs could be capitalized for an internal-use software. The update also requires internal-use software to be disclosed under the ASC 360 Property, Plant, and Equipment guidance. The guidance is effective for annual periods beginning after December 15, 2027. The Company is currently evaluating this ASU to determine its impact on the Company.

Note 2. Revenues

Disaggregation of Revenue

The following table depicts the Company's disaggregated revenue for the periods presented:

Revenue by Geographic Locations

The following table depicts the Company’s revenue by geographic operations for the periods presented:

Revenues by geography are determined based on the region of the Company's contracting entity, which may be different than the region of the customer. North America revenue consists solely of revenue attributed to the United States. For the three months ended September 30, 2026 and 2025, revenue attributed to Belgium (presented within the Rest of the world in the above table) represented approximately 6%. For the nine months ended September 30, 2026 and 2025, revenue attributed to Belgium (presented within the Rest of the world in the above table) represented approximately 6% and 5% of total revenues, respectively. For the nine months ended September 30, 2025, revenue attributed to the United Kingdom (presented within the Rest of the world in the above table) represented 6%. No other foreign country represented more than 5%of total revenue during the three and nine months ended September 30, 2026 and 2025.

Contract Assets

The Company had contract assets of$155,$590, and$1,240 as of September 30, 2026, December 31, 2025, and December 31, 2024, respectively. Contract assets are generated when contractual billing schedules differ from the timing of revenue recognition or cash collections. They represent a conditional right to consideration for satisfied performance obligations that becomes a receivable when the conditions are satisfied. They are recorded as part of other current assets on the condensed consolidated balance sheets.

Deferred Revenue

Details of the Company’s deferred revenue for the periods presented are as follows:

Costs to Obtain

During the nine months ended September 30, 2026 and 2025, the Company capitalized$641 and$1,688 of costs to obtain revenue contracts. The Company amortized costs capitalized to obtain revenue contracts in the amount of$563 and$783 to sales and marketing expense during the three months ended September 30, 2026 and 2025, respectively, and$1,880 and$2,471 during the nine months ended September 30, 2026 and 2025, respectively. There wereno impairments of costs capitalized to obtain revenue contracts for the three and nine months ended September 30, 2026 and 2025.

Unsatisfied Performance Obligations

At September 30, 2026, the Company had$53,359 of remaining contract consideration for which revenue has not been recognized due to unsatisfied performance obligations. This remaining contract consideration is expected to be recognized over the next five years.

Note 3. Dispositions

2026 Disposition

Sale of FrontierView

On August 27, 2026 (the "Closing Date"), the Company entered into an Equity Purchase Agreement (the "Purchase Agreement") with Oxford Economics USA, Inc., a Pennsylvania corporation (the "Buyer"), providing for the sale of all of the outstanding equity interests in Frontier Strategy Group, LLC ("FrontierView"), a Delaware limited liability company. On the Closing Date, after adjustments based on the FrontierView estimated working capital and transaction expenses, the Company received $5,301 in cash (excluding $1,055 of the purchase price that was deposited into escrow to satisfy certain potential post-closing purchase price adjustments and indemnification claims and including $100 of cash acquired by the Buyer). As a result of the sale, the Company recorded a pre-tax loss on disposal of $920 during the three and nine months ended September 30, 2026. The purchase price is subject to adjustment pursuant to the Purchase Agreement; accordingly, the loss on sale may increase, or decrease, as the case may be, upon finalization of the purchase price. The Purchase Agreement also provides for earn-out payments of up to $3,000 in the aggregate, consisting of two payments of $1,500 each, contingent on FrontierView’s annual recurring revenue exceeding specified thresholds as of September 30, 2026 and December 31, 2026, respectively. The annual recurring revenue threshold as of September 30, 2026 was not met; accordingly, the Company did not receive the first $1,500 earn-out payment. The Company may receive the second $1,500 earn-out payment if the annual recurring revenue threshold as of December 31, 2026 is met. The proceeds from the sale of FrontierView were used to prepay and retire $4,951 of term loans under the 2025 Senior Term Loan and $49 of accrued and unpaid interest associated with the retired amount.

The Company determined that FrontierView was not a significant subsidiary, and the sale did not constitute a strategic shift that would have a major effect on the Company’s operations or financial results. As a result, the results of operations for FrontierView were not reported as discontinued operations under the guidance of ASC 205 “Presentation of Financial Statements."

2025 Dispositions

Sale of Oxford Analytica and Dragonfly

On February 21, 2025 (the "Signing Date"), the Company entered into an equity purchase agreement (the "Equity Purchase Agreement") with Factiva Ltd. ("Factiva"), a limited company organized under the laws of England and Wales, providing for the sale of all of the outstanding equity interests in each of Dragonfly Eye Limited, a UK private limited company (“Dragonfly”), and The Oxford Analytica International Group, LLC, a Delaware limited liability company (“Oxford” and collectively with Dragonfly, the “Sold Businesses”). At closing of the sale on March 31, 2025, after adjustments based on the Sold Businesses' estimated working capital, indebtedness, and transaction expenses, the Company received $40,000 in cash (excluding $400 of the purchase price that was deposited into escrow to satisfy certain potential post-closing purchase price adjustments and indemnification claims and including $813 of cash acquired by Factiva). As a result of the sale, the Company recorded a pre-tax gain on disposal of$15,260 for the nine months ended September 30, 2025.

The proceeds from the sale were used in part to prepay and retire $27,136 of term loans under the Prior Senior Term Loan, and pay $1,793 of related prepayment and exit fees associated with the retired amount. The remaining $11,071 ofnet proceeds were retained by the

Companyto pay for related transaction costs, cash taxes that may result from the sale, and general corporate purposes. As part of the sale, the Company recorded a current tax receivable for federal and state income tax of $281.

The Company determined that Oxford Analytica and Dragonfly were not significant subsidiaries, and their sale did not constitute a strategic shift that would have a major effect on the Company’s operations or financial results. As a result, the results of operations for the Sold Businesses were not reported as discontinued operations under the guidance of ASC 205 “Presentation of Financial Statements."

Sale of TimeBase

On May 2, 2025, the Company entered into an agreement to sell the equity of the Company's Australian subsidiary, TimeBase Pty. Ltd. (“TimeBase”). On July 1, 2025, the Company closed the sale of TimeBase. Total consideration was $7,414 comprising a cash payment to the Company of $6,676 and a buyer holdback of $738 (included in Other current assets as the buyer holdback is expected to be repaid in the first quarter of 2027). The proceeds from the sale were used in part to prepay and retire $2,978 of term loans under the Prior Senior Term Loan, and pay $197 of related prepayment and exit fees associated with the retired amount. The remaining $3,501 of net proceeds were retained by the Company to pay for related transaction costs, cash taxes that may result from the sale, and general corporate purposes. As a result of the sale of TimeBase, the Company recorded a gain on disposal of $1,325 during the third quarter of 2025.

The Company determined that TimeBase was not a significant subsidiary, and the disposition of TimeBase did not constitute a strategic shift that would have a major effect on the Company’s operations or financial results. As a result, the results of operations for TimeBase were not reported as discontinued operations under the guidance of ASC 205 “Presentation of Financial Statements."

Note 4. Leases

The Company has operating leases, principally for corporate offices under non-cancelable operating leases that expire at various dates through 2031. The non-cancellable base terms of these remaining leases typically range fromone tofive years. Certain lease agreements include options to renew or terminate the lease, which are not factored into the determination of lease payments if they are not reasonably certain to be exercised.

The following table details the composition of lease expense for the periods presented:

Cash payments related to operating lease liabilities were$1,239 and$1,282 for the three months ended September 30, 2026 and 2025, respectively, and$3,833 and$3,964 for the nine months ended September 30, 2026 and 2025, respectively.

Note 5. Intangible Assets

The following table summarizes the gross carrying amounts and accumulated amortization of the Company’s intangible assets by major class:

Finite-lived intangible assets are stated at cost, net of amortization, generally using the straight-line method over the expected useful lives of the intangible assets. Amortization of intangible assets, excluding developed technology, was $1,863 and$1,904 for the three months ended September 30, 2026 and 2025, respectively, and$5,645 and$6,169 for the nine months ended September 30, 2026 and 2025, respectively.

Amortization of developed technology was recorded as part of cost of revenues, including amortization in the amount of$130 and$153 for the three months ended September 30, 2026 and 2025, respectively, and$435 and$519 for the nine months ended September 30, 2026 and 2025, respectively.

The expected future amortization expense for intangible assets as of September 30, 2026 is as follows:

Capitalized software development costs

Capitalized software development costs are as follows:

During the nine months ended September 30, 2026 and 2025, the Company capitalized interest on capitalized software development costs in the amount of$290 and$326, respectively. Amortization of capitalized software development costs was recorded as part of cost of revenues, including amortization in the amount of$1,473 and$1,617 for the three months ended September 30, 2026 and 2025, respectively, and$4,417 and$6,562 for the nine months ended September 30, 2026 and 2025, respectively. The estimated useful life is determined at the time each project is placed in service.

Impairment of long-lived assets

We periodically assess whether any indicators of impairment existed related to our intangible assets. We identified triggering events during the first and second quarters of 2026, as discussed in Note 6, Goodwill. These triggering events indicated we should test the related long-lived assets for impairment in certain of our asset groups. We tested each applicable asset group by first performing a recoverability test, comparing projected undiscounted cash flows from the use and eventual disposition of each asset group to its carrying value. This test indicated that the undiscounted cash flows were sufficient to recover the carrying value of certain asset groups. As a result, we concluded that no impairment charge was to be recorded for long-lived assets during the first and second quarters of 2026.

Note 6. Goodwill

Goodwill represents the excess of the purchase price in a business combination over the fair value of net assets acquired. Goodwill amounts are not amortized, but are rather tested for impairment at least annually as of October 1 of each year.

The changes in the carrying amounts of goodwill, which are generally not deductible for tax purposes, are as follows:

During the first quarter of 2026, the Company experienced a decline in its market capitalization based upon its publicly quoted share price, the Company failed to satisfy its annualized recurring revenue covenant for the month ended January 31, 2026, reflecting continued pressure on customer retention and organic revenue, and the Company began trading on the OTCID Basic Market. During the second quarter of 2026, the Company experienced a further decline in its market capitalization based upon its publicly quoted share price, the Company failed to satisfy its minimum adjusted EBITDA requirement pursuant to its 2025 Senior Term Loan, and the Company reset its long-range projections. The Company evaluated these factors and in combination, determined that they constituted triggering events requiring interim goodwill impairment assessments under ASC 350. Accordingly, the Company recorded a goodwill impairment of $35,600 in the first quarter of 2026 and a goodwill impairment of $19,100 in the second quarter of 2026 in the condensed consolidated statement of operations. Prior to the quantitative goodwill impairment test performed during the first and second quarters of 2026, the Company tested the recoverability of its long-lived assets, and concluded that none of its intangibles were impaired. See Note 5, Intangible Assets. The Company performed a qualitative analysis over its goodwill during the third quarter of 2026 and determined there were no triggering events that would indicate a goodwill impairment; accordingly, no quantitative goodwill impairment test was performed during the third quarter of 2026. As of September 30, 2026, the Company’s single reporting unit, which is also the Company'ssingle reportable segment, had a negative carrying amount of net assets. All of the Company's goodwill totaling $63,882 has been attributed to this single reporting unit.

On January 1, 2025, effective with the appointment of our then new CEO, the Company reassessed its goodwill reporting unit and determined that the Company operates out of a single reporting unit. Accordingly, the Company performed a quantitative goodwill impairment assessment immediately prior to, and on, January 1, 2025, which resulted inno impairment of goodwill.

The Company performed its annual goodwill impairment test on October 1, 2025 which indicated no impairment. However, due to the sustained decline in the Company's stock price and market capitalization toward the end of the fourth quarter of 2025, as well as the decline in organic revenue and customer retention, the Company performed a quantitative goodwill impairment assessment as of December 31, 2025. This quantitative assessment resulted in a goodwill impairment charge of $12,378 recognized in the fourth quarter of 2025. Prior to the quantitative goodwill impairment test performed at December 31, 2025, the Company tested the recoverability of its long-lived assets, and concluded that none of its intangibles were impaired. See Note 5, Intangible Assets.

The fair value estimate of the Company's single reporting unit was derived based on an income approach. Under the income approach, the Company estimated the fair value of its single reporting unit based on the present value of estimated future cash flows, which the Company considers to be a Level 3 unobservable input in the fair value hierarchy. The cash flows used are consistent with those the Company uses in its internal planning, which reflects actual business trends experienced and our long-term business strategy. As such, key assumptions and factors used in this method include, but are not limited to, revenue, margin, operating expense growth rates, realization of net operating losses, tax rates and policies in place as of the date of impairment testing, as well as a discount rate, and a terminal growth rate. In order to further validate the reasonableness of fair value as determined by the income approach, differences between estimated reporting unit fair value and market capitalization primarily reflect an implied control premium and differences between minority and controlling interests.

Potential indicators of impairment include significant changes in performance relative to expected operating results, significant negative industry or economic trends, or a significant decline in the Company's stock price and/or market capitalization for a sustained period of time. It is reasonably possible that one or more of these impairment indicators could occur or intensify in the near term, which may result in an impairment of long-lived assets or further impairment of goodwill.

Note 7. Debt

The following presents the carrying value of the Company’s debt as of the respective period ends:

2025 Senior Term Loan/ Prior Senior Term Loan

2025 Senior Term Loan

On August 5, 2025, the Company entered into a financing agreement (the "Financing Agreement"), as amended, by and among the Company, as parent guarantor, the Company's domestic subsidiaries party thereto as borrowers and guarantors, the lenders from time to time party thereto, and MGG Investment Group LP, as collateral agent and as administrative agent, pursuant to which the lenders agreed to advance $75,000 which matures on August 12, 2029 (the "2025 Senior Term Loan"). The 2025 Senior Term Loan ranks senior to all other debt and is secured by a first priority lien on substantially all of the Company's assets. Obligations under the 2025 Senior Term Loan bear interest at variable rates, set at the Company’s option, based on a reference rate plus 8.50%, or the secured overnight financing rate as administered by the Federal Reserve Bank of New York (“SOFR”) plus 9.50%. Interest is payable in cash monthly in arrears. The 2025 Senior Term Loan is repayable in consecutive quarterly installments on the last business day of each March, June, September and December. The Company must also pay aquarterly fee of $38.

The 2025 Senior Term Loan also contains four financial covenants: a minimum cash balance requirement, a minimum annual recurring revenue requirement, a minimum adjusted EBITDA requirement, and a capital expenditure limitation. At September 30, 2026, the Company was not in compliance with the minimum cash balance requirement, the minimum ARR requirement, and the minimum adjusted EBITDA requirement. None of these financial covenant defaults have been waived, although as of the date of this filing, the 2025 Senior Term Loan lenders have reserved their rights to exercise their default rights, which could include the immediate repayment of the amount outstanding under the 2025 Senior Term Loan. Accordingly, amounts outstanding under the Company's 2025 Senior Term Loan are presented as a current liability at September 30, 2026.

The 2025 Senior Term Loan also includes covenants limiting the ability of the Company and its subsidiaries, subject to certain exceptions, to, among other things, (i) incur indebtedness, (ii) incur liens on their assets, (iii) enter into any transaction of merger, consolidation or amalgamation, liquidate, wind up or dissolve, or dispose of all or substantially all of their property or business, (iv) dispose of any of their property, or, issue or sell any shares of a subsidiary’s stock, (v) make any payment or prepayment for any subordinated indebtedness, pay any earn-out payment, seller debt or deferred purchase price payments, or (vi) declare or pay any dividend or make any other distribution. The 2025 Senior Term Loan also contains certain events of default, including, among others, (i) failure to pay, (ii) breach of representations and warranties, (iii) breach of covenants, subject to any cure periods described therein, and (iv) failure to pay principal or interest on any other material debt.

On August 12, 2025 the Company closed on the 2025 Senior Term Loan and received net proceeds of $72,937 after original issue discount (“OID”) of $2,063, or 2.75%. The Company incurred $960 of lender fees and $962 of fees paid to third parties. OID and capitalized debt issuance costs totaled $3,985 and are treated as a debt discount and are amortized over the term of the 2025 Senior Term Loan using the effective interest method. Amortization expense for thethree and nine months ended September 30, 2026 was $331 and $960, and is included within Interest expense, net in the condensed consolidated statements of operations and comprehensive income (loss). The remaining unamortized debt discount at September 30, 2026 is $2,424, and is reflected net within debt on the condensed consolidated balance sheet.

On March 23, 2026, the Company entered into an amendment and waiver with respect to the 2025 Senior Term Loan ("Amendment No. 1"). Pursuant to Amendment No. 1, the lenders waived a specified event of default arising from the Company's failure to satisfy the annualized recurring revenue covenant for the month ended January 31, 2026. Amendment No. 1 amended and restated the financial covenant schedule, including revised minimum thresholds for annualized recurring revenue and consolidated adjusted EBITDA and reduced minimum liquidity requirements through March 31, 2027, after which the minimum liquidity requirement returns to $20,000. Amendment No. 1 increased the quarterly principal repayment to (i) $1,875 for payment on each of March 31, 2026, June 30, 2026, September 30, 2026, December 31, 2026 and March 31, 2027 and (ii) $938 for each quarterly payment thereafter. Amendment No. 1 also requires the Company to make a mandatory prepayment of $20,000 (reduced to $15,049 as a result of the prepayment of $4,951 on August 27, 2026 with the proceeds from the sale of FrontierView, as noted in Note 3, Dispositions) no later than March 31, 2027, together with any applicable premium and related fees.

On April 13, 2026 the Company's Class A common stock was delisted from the NYSE, which caused events of default under the YA Convertible Notes and the 2025 GPO Convertible Note. On April 21, 2026, the Company entered into forbearance agreements, which were extended on each of May 18, 2026, June 24, 2026 and July 22, 2026, with the Subordinated Creditors who agreed to waive defaults under the terms of their subordinated convertible debt instruments arising from the NYSE delisting, and to forbear from exercising any rights relating to such defaults, until August 21, 2026. The forbearance agreements with the Subordinated Creditors expired on August 22, 2026; without, in either case, any agreement with respect to a waiver of the existing defaults under the YA Convertible Notes and the 2025 GPO Convertible Note; accordingly, the Company is also in default of its 2025 Senior Term Loan due to the cross-default provision within the 2025 Senior Term Loan.

On August 27, 2026, in connection with the sale of FrontierView (See Note 3, Business Dispositions), the Company applied $5,000 of cash proceeds from the sale of FrontierView to retire $4,951 of outstanding principal and $49 of accrued interest under the 2025 Senior Term Loan. The Company accounted for the repayment as a partial extinguishment of debt, derecognizing a pro-rata portion of unamortized debt discount and unamortized debt premium of $192 and $4, respectively, and including $116 of legal costs incurred to effect the repayment in the reacquisition price, resulting in a loss on extinguishment of $304, recorded within loss on debt extinguishment in the condensed consolidated statements of operations.

The Company has elected to pay cash interest based on SOFR, which was 13.24% (plus applicable margin) at September 30, 2026. For the three and nine months ended September 30, 2026, the Company recognized $2,309 and $6,905 of cash interest on the 2025 Senior Term Loan.

Upon maturity, the Company is required to pay in cash the greater of $500 or the fair market value of 60,416 shares of Class A Common Stock of the Company (the “Exit Fee”). The Company records non-cash interest expense over the life of the 2025 Senior Term Loan to accrete to the minimum Exit Fee due upon maturity. Accordingly, during thethree and nine months ended September 30, 2026, the Company recognized $43 and $122 of interest expense related to the Exit Fee. At September 30, 2026, $173 of the minimum Exit Fee has been accrued and is included within Other current liabilities on the condensed consolidated balance sheet.

Because the Exit Fee is payable in certain redemption scenarios, the Company determined that pursuant to ASC 815 “Derivatives and Hedging” certain of the embedded redemption features meet the definition of a derivative that must be accounted for at fair value with changes in fair value reflected in the condensed consolidated statement of operations and comprehensive income (loss). The fair value of the embedded redemption feature at inception on August 12, 2025 was $90 and was accounted for as a debt premium and is amortized over the term of the 2025 Senior Term Loan using the effective interest method. Amortization expense for thethree and nine months ended September 30, 2026 was $7 and $22, and is included within Interest expense, net in the condensed consolidated statements of operationsand comprehensive income (loss). The remaining unamortized debt premium at September 30, 2026 is $55, and is reflected net within debt on the condensed consolidated balance sheet. The fair value of the embedded redemption features at September 30, 2026 was $29 and is included as a contra-liability in Accounts payable and accrued expenses on the condensed consolidated balance sheet. Thechange in fair value of the embedded redemption features is included as a charge of$316 and $136 for the three and nine months ended September 30, 2026, respectively, within Change in fair value of financial instruments on the condensed consolidated statement of operations and comprehensive income (loss). As of September 30, 2026, the unpaid principal balance of the 2025 Senior Term Loan is $63,487.

As part of Amendment No. 1, the Company is accruing a make-whole amount ("Make-Whole Premium"), which equals all interest the Lenders would have earned from the trigger date until the second anniversary of the effective date. The Company recognized$332 and $769 of interest expense related to the Make-Whole Premium during the three and nine months ended September 30, 2026, respectively. At September 30, 2026, $769 of the Make-Whole Premium has been accrued and is included within Accounts payable and accrued expenses on the condensed consolidated balance sheet.

Prior Senior Term Loan

On July 29, 2022, FiscalNote, Inc., a wholly owned indirect subsidiary of FiscalNote Holdings, Inc., entered into a senior credit agreement (the "Prior Senior Term Loan") as amended from time to time. The annual interest of the Prior Senior Term Loan consisted of two components: (a) a cash interest component of the greater of (i) Prime Rate plus 5.0% per annum or (ii)9.0% payable monthly, and (b) interest payable in kind component of 1.00% per annum, payable in kind monthly.

In connection with the completion of the sale of Oxford Analytica and Dragonfly on March 31, 2025, the Company also entered into Amendment No. 5 to the Prior Senior Term Loan, pursuant to which, among other things, the lenders consented to releasing the liens on Oxford Analytica and Dragonfly's assets and permitting the consummation of the sale in exchange for the permanent retirement of $27,136 of term loans under the Senior Term Loan and payment of $1,793 of related prepayment and exit fees.

On May 2, 2025, the Company also entered into Amendment No. 6 to the Prior Senior Term Loan (“Amendment No. 6”), pursuant to which, among other things, the lenders consented to the sale of TimeBase and agreed that, automatically upon receipt by the lenders of $3,175 from the proceeds of the sale of TimeBase, the lenders released TimeBase as a guarantor under the Prior Senior Term Loan, along with the liens granted on the equity and assets of TimeBase.

For the nine months ended September 30, 2025, the Company incurred $5,610 and $448 of cash interest and paid-in-kind interest, respectively, on the Prior Senior Term Loan. Paid-in-kind interest is reflected as a component of the carrying value of the Prior Senior Term Loan.

Amortization of debt issuance costs on the Prior Senior Term Loan is recorded within Interest expense, net in the condensed consolidated statements of operations and comprehensive income (loss) and totaled $424 and $2,062 for thethree and nine months ended September 30, 2025.

2025 GPO Convertible Note/Prior GPO Convertible Note

On June 30, 2023, the Company issued to GPO FN Noteholder LLC (the “GPO Investor”) a subordinated convertible promissory note in an initial principal amount of $46,794 (the “Prior GPO Convertible Note”). Pursuant to the terms of the Prior GPO Convertible Note, paid-in-kind interest accrued from the date of issuance through June 30, 2024. Beginning on July 1, 2024, the Company was required to pay interest with either cash or shares, solely at the discretion of the Company. Accordingly, since September 30, 2024 and through December 31, 2025, the Company issued the GPO Investor 346,058 shares of Class A Common Stock, in the aggregate, in satisfaction of quarterly interest pursuant to the terms of the Prior GPO Convertible Note.

In conjunction with the establishment of the 2025 Senior Term Loan, on August 5, 2025, the Company entered into a redemption and exchange agreement with the GPO Investor. Pursuant to the redemption and exchange with the GPO Investor, on August 12, 2025, the Company redeemed $30,000 of the Prior GPO Convertible Note (which at the time had balance outstanding of $50,434) in exchange for a cash payment of $27,000 to the GPO Investor (the "GPO Redemption"). The Company also issued a new senior subordinated promissory note to the GPO Investor in the aggregate amount of $20,434 (the "2025 GPO Convertible Note") in exchange for, and the cancellation of, the remaining obligations under the existing Prior GPO Convertible Note.

The 2025 GPO Convertible Note is guaranteed by the Company’s domestic subsidiaries, which are parties to the 2025 Senior Term Loan, and is contractually subordinated to the Company’s obligations under the 2025 Senior Term Loan. The 2025 GPO Convertible Note matures on November 13, 2029 and bears interest at a rate of 7.50% per annum payable quarterly in arrears, in cash or, provided no event of default is then occurring under the 2025 GPO Convertible Note, freely tradeable shares of the Company's Class A Common Stock, at the Company’s option, with the value per share determined with reference to the VWAP of the Class A Common Stock over the trading days occurring within the thirty calendar days prior to the applicable interest payment date. At any time prior to November 13, 2029, the GPO Investor is entitled to convert all or any portion of the principal amount of the 2025 GPO Convertible Note and accrued interest thereon into shares of the Company's Class A Common Stock at an initial conversion price of $82.92 per share (subject to customary anti-dilution adjustments). Under the terms of the 2025 GPO Convertible Note, the Company is required to make quarterly installment payments of $2,000 of the outstanding principal beginning April 1, 2026 in the form of freely tradeable shares of the Company's Class A Common Stock, cash, or a combination thereof, solely at the determination of the Company. Class A Common Stock issued to satisfy quarterly interest and principal repayments will be issued at a price equal to the lowest of (i) the then-effective Conversion Price under the 2025 GPO Convertible Note, (ii)95% of the VWAP of the Class A Common Stock over the ten trading days immediately preceding the applicable Installment Date and (iii)95% of the VWAP of the Class A Common Stock over the trading days occurring within the ninety calendar day period immediately preceding the applicable payment date.

In connection with the April 1, 2026 interest and principal payment made in shares of the Company's Common Stock, the Company and the GPO Investor agreed to a one-time modification to the applicable conversion price of $0.85 per share (in lieu of the contractual formula) for the April 1, 2026 payment only. Accordingly, in April 2026 the Company issued 2,803,698 shares of Class A Common Stock to satisfy (a) its quarterly interest payment for the first quarter of 2026 due on April 1, 2026, and (b) its $2,000 principal repayment requirement, also due on April 1, 2026. The non-cash gain of $1,692 recognized upon these conversions was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during the nine months ended September 30, 2026.

On June 16, 2026, the Company entered into a letter agreement with the GPO Investor pursuant to which the GPO Investor waived its right to receive the $2,000 installment amount otherwise payable on July 1, 2026, with such amount instead payable on the maturity date of the 2025 GPO Convertible Note. In June 2026, the Company issued 1,510,237 shares of Class A Common Stock which was credited towards the Company’s July 1, 2026 quarterly interest payment. On July 1, 2026, the Company issued 891,712 shares of Class A Common Stock to fully satisfy its July 1, 2026 quarterly interest payment.

On October 1, 2026, the Company entered into a letter agreement with the GPO Investor pursuant to which the GPO Investor waived its right to receive the $2,000 installment amount otherwise payable on October 1, 2026, with such amount instead payable on the earlier of (a) the GPO Investor's election, and (b) the maturity date of the 2025 GPO Convertible Note. In October and November 2026, the Company issued a total of 7,407,213 shares of Class A Common Stock in satisfaction of its third quarter interest that was due on October 1, 2026.

The 2025 GPO Convertible Note provides for customary events of default upon which repayment of the 2025 GPO Convertible Note may be accelerated, including failure to pay any amounts due and owing under the 2025 GPO Convertible Note, failure to deliver the shares upon a conversion of the 2025 GPO Convertible Note, an uncured breach of any terms of the 2025 GPO Convertible Note and a default under certain of the Company’s other indebtedness. The 2025 GPO Convertible Note includes certain negative covenants related to the Company’s ability to incur indebtedness. On April 13, 2026, the Company’s Class A common stock was delisted from the NYSE. The NYSE delisting caused an event of default under the 2025 GPO Convertible Note. On April 21, 2026, the Company entered into a forbearance agreement with the holder of the 2025 GPO Convertible Note, which was extended on each of May 18, 2026, June 24, 2026 and July 22, 2026, pursuant to which the holder agreed to waive defaults under the terms of the subordinated convertible debt instrument, and to forbear from exercising any rights relating to such defaults, until August 21, 2026. On August 22, 2026 the forbearance agreement with the GPO Investor expired without any waiver of the delisting-related default. Accordingly, amounts outstanding under the Company's 2025 GPO Convertible Note are presented as a current liability at September 30, 2026.

The Company elected to account for the 2025 GPO Convertible Note using the fair value option. The fair market value at September 30, 2026, June 30, 2026, and December 31, 2025 was $16,866,17,562, and $19,235, respectively. The unrealized change in the fair value of the GPO Convertible Note of $1,043 and $1,677, as a result of the change in the Company's specific credit risk, is recorded in accumulated other comprehensive income for thethree and nine months ended September 30, 2026 and the unrealized change in the fair value of the 2025 GPO Convertible Note was recorded in the Change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) in the amount of a loss of $347 and $1,308 during thethree and nine months ended September 30, 2026. The Company incurred total interest expense related to the 2025 GPO Convertible Note of $353 and $1,086 for thethree and nine months ended September 30, 2026. The unrealized change in the fair value of the 2025 GPO Convertible Note was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) in the amount of a loss of $358 during the three months ended September 30, 2025. The Company incurred interest expense related to the 2025 GPO Convertible Note of $209 for the three months ended September 30, 2025. As of September 30, 2026, the unpaid principal balance of the 2025 GPO Convertible Note is $18,434.

The Company elected to account for the Prior GPO Convertible Note using the fair value option. The unrealized change in the fair value of the Prior GPO Convertible Note was recorded in the Change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) in the amount of a loss of $5,398 and $5,320 for thethree and nine months ended September 30, 2025. The Company incurred total interest expense related to the Prior GPO Convertible Note of $452 and $2,354 for thethree and nine months ended September 30, 2025, respectively.

In conjunction with the establishment of the 2025 Senior Term Loan and in order to fund the GPO Redemption, on August 5, 2025 (the “Purchase Agreement Date”), the Company entered into a securities purchase agreement (the “Purchase Agreement”), with YA II PN, Ltd (“YA”), pursuant to which the Company would issue YA convertible debentures in an aggregate principal amount of up to $33,300 (the “Convertible Debentures”) for a total cash purchase price of $30,000, subject to satisfaction of certain closing conditions.

On August 12, 2025, the initial tranche of Convertible Debentures comprising $21,000 in stated principal amount were issued to YA, in accordance with the Purchase Agreement, with the Company receiving net proceeds of $18,900 (the "First YA Debenture"). On September 11, 2025, the second and final tranche of Convertible Debentures comprising $12,300 in stated principal amount were issued to YA, in accordance with the Purchase Agreement with the Company receiving net proceeds of $11,000 (the "Second YA Debenture").

The Company’s obligations under the Purchase Agreement and the Convertible Debentures are guaranteed by FiscalNote, Inc., a wholly owned subsidiary of the Company, and are contractually subordinated to the Company’s obligations under its 2025 Senior Term Loan and the 2025 GPO Note. The First YA Debenture matures on February 12, 2027 and the Second YA Debenture matures on March 11, 2027 and both bear interest at a rate of 5% per annum or 18% per annum in the event of an event of default. The maturity dates of the First YA Debenture and the Second YA Debenture will automatically extend to the first day subsequent to the maturity date of the 2025 Senior Term Loan if one, or both, of the notes have a balance outstanding on February 12, 2027.

At any time prior to the maturity dates, and subject to certain ownership and conversion limitations, YA is entitled to convert any portion of the principal amount of the Convertible Debentures and accrued interest thereon into shares of the Company’s Class A Common Stock (the “Debenture Conversion Shares”) at a conversion price equal to 94% of the lowest daily volume weighted average trading price (“VWAP”) during the five trading days prior to the conversion date, subject to a floor price of $0.8884 (the “Floor Price”), unless the Floor Price is waived by the Company in connection with any conversions. The Company has waived the Floor Price in respect of all of YA’s conversions since the VWAP first dropped below the Floor Price.

In the event (i) the daily VWAP is less than the Floor Price then in effect for any five trading days during a period of seven consecutive trading days, (ii) the Company has issued substantially all of the shares of the Class A Common Stock available for issuance without violating applicable rules of the NYSE, or (iii) YA is unable to utilize a registration statement to resell Debenture Conversion Shares for a period of ten (10) consecutive trading days, then the Company will be required to make certain amortization payments to YA.

The Convertible Debentures provide for customary events of default, upon which repayment of the Convertible Debentures may be accelerated, including failure to pay any amounts due and owing under the Convertible Debentures, failure to timely deliver the Debenture Conversion Shares, an uncured breach of any terms of the Convertible Debentures and a default under certain of the Company’s other indebtedness. On April 13, 2026, the Company’s Class A common stock was delisted from the NYSE. The NYSE delisting constituted an event of default under the Convertible Debentures. On April 21, 2026, the Company entered into a forbearance agreement with the holder of the Convertible Debentures, which was extended on each of May 18, 2026, June 24, 2026 and July 22, 2026, pursuant to which the holder agreed to waive defaults under the terms of the subordinated convertible debt instrument, and to forbear from exercising any rights relating to such defaults, until August 21, 2026. On August 22, 2026 the forbearance agreement with YA expired without any waiver of the delisting-related default. Accordingly, amounts outstanding under the Company's Convertible Debentures are presented as a current liability at September 30, 2026.

During the three months ended September 30, 2026, YA converted $483 of principal and $79 of accrued interest in exchange for 9,361,712 shares of the Company’s Class A common stock with a fair value of $728. During thenine months ended September 30, 2026, YA converted $3,642 of principal and $750 of accrued interest in exchange for 16,295,519 shares of the Company’s Class A common stock with a fair value of $4,642. The non-cash charge of $213 and $426 recognized upon these conversions was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during thethree and nine months ended September 30, 2026.

The Company elected to account for the First YA Debenture and Second YA Debenture using the fair value option. The fair market value at September 30, 2026 and December 31, 2025 was $20,766 and $26,663, respectively. The unrealized change in the fair value of the First YA Debenture and Second YA Debenture was recorded in the Change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) in the amount of a gain of $621 and $2,431 for thethree and nine months ended September 30, 2026. The Company incurred total interest expense related to the First YA Debenture and Second YA Debenture of $303 and $930 for thethree and nine months ended September 30, 2026. As of September 30, 2026, the unpaid principal balance of the First YA Debenture and Second YA Debenture is $19,630 and $4,128, respectively.

On September 12, 2025 YA converted $1,803 of principal and accrued interest in exchange for 39,860 shares of the Company’s Class A common stock with a fair value of $2,186. The non-cash charge of $563 recognized upon this conversion was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during the three and nine months ended September 30, 2025. The fair market value at August 12, 2025 and September 30, 2025 was $29,970 and $29,753, respectively. The unrealized change in the fair value of the First YA Debenture and Second YA Debenture was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) in the amount of a charge of $1,403 for the three months ended September 30, 2025. The Company incurred total interest expense related to the First YA Debenture and Second YA Debenture of $170 for the three months ended September 30, 2025.

Convertible Notes

Purchased Original Notes

On March 17, 2025 and March 20, 2025, investors holding two convertible notes originally issued in 2020 and assumed by the Company in connection with the Business Combination, with a principal and accrued paid-in-kind interest balance of $5,769 (the "Purchased Original Notes"), sold their convertible notes to EGT 11 LLC (the "Exchange Investor"). In connection with the acquisition of the Purchased Original Notes by the Exchange Investor, the Company entered into a Securities Exchange Agreement (the “Exchange Agreement”) on March 17, 2025, pursuant to which the Company cancelled the Purchased Original Notes and in exchange (i) issued a convertible note to the Exchange Investor, for $5,500 on March 17, 2025 and (ii) issued a second convertible note for $269 on March 20, 2025 (collectively, the "Third Era Convertible Note"). The acquisition of the Purchased Original Notes by the Exchange Investor and the Exchange Agreement resulted in the extinguishments of the Purchased Original Notes. Accordingly, the Company recognized a loss on debt extinguishment of $1,784 during thenine months ended September 30, 2025. The Company incurred total interest expense related to the Purchased Original Notes, including the amortization of the various discounts, of $202 during thenine months ended September 30, 2025.

Amended Legacy Notes

On March 25, 2025 (the "Amendment Date"), the Company entered into a letter agreement (the “First Amendment”) with the holders (the "Legacy Investors") of two convertible notes originally issued in 2020 and assumed by the Company in connection with the Business Combination (the "Legacy Notes" and, as amended, the "Amended Legacy Notes") with a principal and accrued paid-in-kind interest balance of $10,961 modifying certain provisions in favor of each of the Legacy Investors. The Legacy Notes were unsecured and earned payable in kind interest of 15% per annum, payable annually in arrears.

Pursuant to the terms of the amended Legacy Notes, during the nine months ended September 30, 2025 the Company converted $8,136 of the Legacy Notes into 1,049,421 Class A Common Shares. The Company incurred total interest expense related to the amended Legacy Notes, including the amortization of the various discounts, of $251 and $1,153 during the three and nine months ended September 30, 2025, respectively.

On July 30, 2025, the Company and the holders of the Amended Legacy Notes agreed to extend the original maturity date to August 15, 2025. On August 12, 2025, the Company retired all of its then outstanding obligations under the Amended Legacy Notes by paying the holders $3,600 in cash. No extinguishment gain or loss was recognized.

Dragonfly Seller Convertible Notes

In connection with the Company's acquisition of Dragonfly, the Company financed part of the purchase with the issuance of convertible notes (the "Dragonfly Seller Convertible Notes"). The Dragonfly Convertible Notes were issued in a principal amount of £8,929 pounds sterling (approximately $11,050 on January 27, 2023, the closing date of the acquisition of Dragonfly by the Company), with interest at an annual rate of 8%, which can be paid in cash or paid-in-kind. The paid-in-kind interest will be annually credited to the principal amount. All principal and accrued interest are due upon maturity on January 27, 2028. The Company can convert any portion of the principal and accrued interest at the VWAP for the five consecutive trading day period ending on the last trading day of the calendar month preceding the date the Company provides notice of conversion to the Sellers. The lender has the right to convert the outstanding principal and accrued interest for FiscalNote common stock at $120.00 per share, subject to adjustment in the event of any stock dividend, stock split, reverse stock split, combination or other similar recapitalization with respect to common stock.

In January 2025, one of the noteholders voluntarily elected to convert £547 pounds sterling (approximately $702 as of the date of conversion) pursuant to the lender conversion right of $10.00 per share; accordingly, the Company issued the holder 5,613 shares of the Company's common stock with a fair value of $67. The non-cash gain of $635 recognized upon this conversion was recorded in the change infair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during the three months ended March 31, 2025.

The Company elected to account for the Dragonfly Seller Convertible Notes using the fair value option. The fair market value of the Dragonfly Seller Convertible Notes outstanding at September 30, 2026 and December 31, 2025 was $11,963 and $11,982, respectively. The unrealized change in the fair value of the Dragonfly Seller Convertible Notes of$717 and $1,080, as a result of the change in the Company's specific credit risk, is recorded in accumulated other comprehensive income for the three and nine months ended September 30, 2026, respectively. The gain of $83 and non-cash loss of $348 was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during thethree and nine months ended September 30, 2026, respectively. As of September 30, 2026, the unpaid principal and Paid in kind balance of the Dragonfly Seller Convertible Notes is£11,277 pounds sterling (approximately$14,976). The non-cash loss of $707 and $770 was recorded in the Change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during thethree and nine months ended September 30, 2025, respectively. The Company incurred total interest expense related to the Dragonfly Seller Convertible Notes of $292 and $258 during thethree months ended September 30, 2026 and 2025, respectively, and $855 and $786 for thenine months ended September 30, 2026 and 2025, respectively.

Era Convertible Notes

Second Era Convertible Note

The Company issued a senior subordinated convertible note to an affiliate of Era ("Era II"), for $5,500 on November 12, 2024 (the "Second Era Convertible Note"). The Second Era Convertible Note had a maturity date of November 12, 2027 and a cash interest rate equal to the applicable federal rate published by the Internal Revenue Service beginning on May 12, 2025. The Company issued 212,427 shares of common stock to Era II (the "Second Era Convertible Note Success Fee Shares") as a success fee and 54,166 shares of common stock to Northland Securities, Inc. to cover brokerage fees incurred by Era II in connection with its liquidating (i) any shares of common stock underlying the Second Era Convertible Note and the Second Era Convertible Note Success Fee Shares and (ii) the shares of common stock underlying the First Era Convertible Note as well as shares of common stock issued pursuant to the Co-Pilot Agreement.

On December 18, 2024 and December 27, 2024 the Company converted all of the outstanding principal of the Second Era Convertible Note and issued Era II, in aggregate,448,106 shares of common stock. Accordingly, the Company had no obligations outstanding related to the Second Era Convertible Note at December 31, 2024 or any time thereafter.

The Company elected to account for the Second Era Convertible Note using the fair value option. The Second Era Convertible Note was recorded at its acquisition date fair value of $5,500. The non-cash loss of $2,973 was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during the fourth quarter of 2024. In January 2025, Era II returned 89,288 shares of common stock pursuant to the terms of the Second Era Convertible Note.

Third Era Convertible Note

The Third Era Convertible Note was issued in an aggregate principal amount of $5,769, with cash interest accruing at a rate equal to the applicable federal rate published by the Internal Revenue Service beginning on September 17, 2025. All principal and unpaid interest mature on March 17, 2028. The Company received no cash from the Third Era Convertible Note because it was exchanged for the Purchased Original Notes.

The Third Era Convertible Note is contractually subordinated to the Company’s obligations under its senior secured indebtedness, and accordingly the Company’s right to make certain cash payments in connection therewith is limited by the terms of such subordination agreement. Beginning on the six-month anniversary of the issuance of the applicable Third Era Convertible Note, the Exchange Investor may convert such Third Era Convertible Note into shares (the “Conversion Shares”) of the Company's Class A Common Stock, based on the volume weighted average market price of the Class A Common Stock for the 30 consecutive trading day period prior to the date of conversion (the "Conversion Price"). In addition, subject to certain limitations, the Company may elect to convert the Third Era Convertible Note into Conversion Shares at the Conversion Price. The Exchange Notes provide for customary events of default, upon which repayment of the Exchange Notes may be accelerated.

Pursuant to the Exchange Agreement, the Company issued 216,338 shares of Common Stock (the “Third Era Convertible Note Fee Shares") to the Exchange Investor as an inducement for the Exchange Investor to exchange the Purchased Original Notes for the Third Era Convertible Note. The Third Era Convertible Note Fee Shares are presented as temporary equity in the condensed consolidated balance sheet at their grant date fair value of $2,719.

As compensation for its brokerage services provided to the Exchange Investor, the Company also issued 25,000 shares of Common Stock to Northland Securities, Inc. (the “Brokerage Fee Shares”) with a fair value of $315 that was reflected as a non-cash charge within general and administrative expenses in the condensed consolidated statements of operations and comprehensive income (loss) during thenine months ended September 30, 2025

On August 12, 2025, the Company retired all of the outstanding obligations under the Third Era Convertible Note by paying the holders $8,176 in cash. As a result of the extinguishment, the Company recognized a gain of $634 that was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during the three and nine months ended September 30, 2025. In the third quarter of 2025, the Exchange Investor returned, and the Company subsequently cancelled,

182,580 shares of Class A Common Stock. Accordingly, the Company has no obligations outstanding related to the Third Era Convertible Note at December 31, 2025 or any time thereafter.

Total Debt

The following table summarizes the total estimated fair value of the Company's debt as of September 30, 2026 and December 31, 2025, respectively. These fair values are deemed Level 3 liabilities within the fair value measurement framework.

Note 8. Stockholders’ Equity and Temporary Equity

Authorized Capital Stock

The Company's Class A common stock and public warrants are traded on the OTCID Basic Market under the symbols “NOTE” and “NOTE WS,” respectively. The Company’s charter authorizes the issuance of 1,809,000,000 shares, which includes Class A common stock, Class B common stock, and preferred stock.

Class A Common Stock

Pursuant to the Company’s charter, the Company is authorized to issue 1,700,000,000 shares of Class A common stock, par value $0.0001 per share. As of September 30, 2026, the Company had 38,137,877 shares of Class A common stock issued and outstanding.

Additionally, the Company has outstanding warrants to purchase shares of New FiscalNote Class A common stock that became exercisable upon the Closing of the Business Combination. See Note 10, Warrant Liabilities.

Class B Common Stock

Pursuant to the Company’s charter, the Company is authorized to issue 9,000,000 shares of Class B common stock, par value $0.0001 per share. As of September 30, 2026, the Company had 690,909 shares of Class B common stock issued and outstanding.

Preferred Stock

Pursuant to the Company’s charter, the Company is authorized to issue 100,000,000 shares of preferred stock, par value $0.0001 per share. Our board of directors has the authority without action by the stockholders, to designate and issue shares of preferred stock in one or more classes or series, and the number of shares constituting any such class or series, and to fix the voting powers, designations, preferences, limitations, restrictions and relative rights of each class or series of preferred stock, including, without limitation, dividend rights, conversion rights, redemption privileges and liquidation preferences, which rights may be greater than the rights of the holders of the common stock. No preferred stock has been issued to date.

Dividends

The Company's Class A and Class B common stock are entitled to dividends if and when any dividend is declared by the Company's board of directors, subject to the rights of all classes of stock outstanding having priority rights to dividends. The Company has not paid any cash dividends on common stock to date. The Company may retain future earnings, if any, for the further development and expansion of the Company's business and has no current plans to pay cash dividends for the foreseeable future. Any future determination to pay dividends will be made at the discretion of the Company's board of directors and will depend on, among other things, the Company's financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as the Company's board of directors may deem relevant.

Temporary Equity

As discussed in Note 7, Debt, the Company issued 216,338 shares of common stock to the Exchange Investor as an inducement for the Exchange Investor to exchange the Purchased Original Notes for the Third Era Convertible Note. Pursuant to ASC 480, “Distinguishing Liabilities from Equity”, the Company has presented the Third Era Convertible Note Fee Shares as temporary equity as they are not mandatorily redeemable on the issuance date but they are redeemable at an unknown time in the future upon an event that is outside of the control of the Company. In the third quarter of 2025, the Exchange Investor returned, and the Company subsequently cancelled,182,580 shares of Class A Common Stock.

Note 9. Earnout Shares and RSUs

The shareholders and other equity holders of Old FiscalNote as described below are entitled to receive up to 1,599,591 additional shares of Class A Common Stock of New FiscalNote (the “Earnout Awards”) in the form of Earnout Shares or as shares reserved for issuances upon settlement of Earnout RSUs, as described below. The Earnout Awards are split into five tranches each consisting of 319,918 shares of Class A Common Stock in New FiscalNote. Certain Old FiscalNote equity holders will receive Earnout Restricted Stock Units (the “Earnout RSUs”), which are settled in Class A common stock. The right to receive Earnout Awards will expire on July 29, 2027 (the“Earnout

Period”). Each tranche of the Earnout Awards will be issued only when the dollar volume-weighted average price of one share of New FiscalNote Class A common stock is greater than or equal to $126.00, $150.00, $180.00, $240.00, or $300.00, respectively, for any 10 trading days within any period of 20 consecutive trading days during the Earnout Period (collectively, the “Triggering Events”).

A portion of the Earnout Shares that may be issued to Old FiscalNote common stockholders, Old FiscalNote vested option holders and Old FiscalNote warrant holders and all of the Earnout RSUs were determined to represent additional compensation for accounting purposes pursuant to ASC 718, “Compensation-Stock Compensation”. The Company recognizes stock-compensation expense based on the fair value of the Earnout Awards over the requisite service period for each tranche. The Company recognized$43 and $108 of share-based compensation expense during the three and nine months ended September 30, 2025, respectively. The remaining Earnout Shares were determined to represent an equity transaction in conjunction with the reverse recapitalization and were evaluated pursuant to ASC 480, “Distinguishing Liabilities from Equity” and ASC 815, “Derivatives and Hedging”. These remaining Earnout Shares are accounted for as a liability as the arrangement is indexed to something other than the Company’s stock. The liability is revalued at each reporting period with changes being recorded as a non-operating gain or loss in the condensed consolidated statements of operations and comprehensive income (loss). The liability of$68 was recorded in other non-current liabilities on the condensed consolidated balance sheets as of September 30, 2026 and December 31, 2025.

As of September 30, 2026, there wasno unrecognized compensation expense related to the Earnout Awards. As of September 30, 2026, no Earnout Shares and no Earnout RSUs have been issued asno Triggering Events have occurred.

Note 10. Warrant Liabilities

As a result of the Reverse Stock Split, and pursuant to the terms of the applicable warrant agreement, at September 30, 2026, the Company had 8,358,964 public warrants outstanding to purchase a total of 1,094,625 shares of Class A common stock and 7,000,000 private placement warrants outstanding to purchase a total of 916,666 shares of Class A common stock, with each whole warrant being exercisable to purchase 0.130952 shares of Class A common stock at an effective price per share of$87.82 per whole share.

During the nine months ended September 30, 2026, no public warrants were exercised into shares of Class A common stock. No private placement warrants have been exercised to date. Accordingly, as of September 30, 2026, the Company had 8,358,964 public warrants and 7,000,000 private placement warrants outstanding with a per warrant fair value of$0.018. These warrants are accounted for as a liability and have a fair value of$276 and$477 at September 30, 2026 and December 31, 2025, respectively.

Note 11. Stock-Based Compensation

2022 Long-Term Incentive Plan

In connection with the Business Combination, the Company's board of directors adopted, and its stockholders approved, the 2022 Long-Term Incentive Plan (the “2022 Plan”) under which 1,690,466 shares of Class A common stock were initially reserved for issuance. Effective December 31, 2024, the 2022 Plan was amended to (i) effectuate a one-time increase of 333,333 shares authorized for issuance under the 2022 Plan and (ii) revise the “evergreen” provision of the 2022 Plan such that the number of shares of Class A common stock that are automatically added to the 2022 Plan on January 1st of each year will be increased up to the lesser of (a) five percent (5%) of the total number of shares of Class A common stock outstanding on December 31 st of the preceding calendar year or (b)1,126,977 shares of Class A Common Stock (the “2022 Plan Amendment”). The 2022 Plan allows for the issuance of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, other stock-based awards and cash-based awards. The number of shares of the Company’s Class A common stock available for issuance under the 2022 Plan increases on the first day of each calendar year, continuing through and including January 1, 2027, by the lesser of (a)1,126,977, (b) three percent (3%) prior to the 2022 Plan Amendment and five percent (5%) after the 2022 Plan Amendment, in each case, of the total number of shares of Class A Common Stock outstanding on December 31st of the immediately preceding fiscal year or (c) a lesser number determined by the Company’s board of directors prior to January 1 of a given year. In accordance with this provision, on January 1, 2025, the number of shares authorized for issuance under the 2022 Plan increased by 928,309. There wasno increase on January 1, 2026 in the number of shares authorized for issuance under the 2022 Plan as the Company has hit its limit.

During the nine months ended September 30, 2026, the Company issued 280,231 restricted stock units. At September 30, 2026,511,757 stock options,91,004 performance stock options, and 375,014 restricted stock units remain outstanding. As of September 30, 2026, the Company had 1,167,676 shares of Class A common stock available for issuance under the 2022 Plan.

As part of the Company's appointment of its new CEO, in July 2026 the Company issued the CEO 1,450,000 performance-based restricted stock units outside of the 2022 Long-Term Incentive Plan. All of these awards are unvested and outstanding at September 30, 2026.

The Company recognized $255 and $3,599 of stock-based compensation expense for all long term incentive plans in effect during thethree months ended September 30, 2026 and 2025, respectively, and $4,054 and $10,648 during the nine months ended September 30, 2026 and 2025, respectively.

2022 Employee Stock Purchase Plan

In connection with the Business Combination, the Company’s board of directors adopted, and its stockholders approved, the 2022 Employee Stock Purchase Plan (the “ESPP”) whereby eligible employees may authorize payroll deductions of up to 15% of their regular base salary to purchase shares at the lower of 85% of the fair market value of the common stock on the date of commencement of the offering period or on the last day of the six-month offering period. The plan is defined as compensatory, and accordingly, a stock-based compensation charge of $28 was recorded as the difference between the fair market value and the discounted purchase price of the Company's common stock for the three months ended September 30, 2025 and$115 for the nine months ended September 30, 2025. On August 5, 2026, the Company's Board of Directors suspended the ESPP indefinitely. There wasno stock-based compensation charge recorded during thethree and nine months ended September 30, 2026. During the nine months September 30, 2026,247,674 shares were issued under the ESPP. As of September 30, 2026, the company had 273,169 shares of Class A common stock available for issuance under the ESPP.

2024 Inducement Plan Grants

In 2024, the Company's board of directors adopted the 2024 Inducement Equity Incentive Plan (the “Plan”). The plan allows for the issuance of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights, other stock-based awards and cash-based awards. Under the Plan,41,666 shares of Class A common stock were initially reserved for issuance.

During 2024, the Company issued 16,666 stock options and 25,000 restricted stock units. At September 30, 2026,16,666 stock options and 7,645 restricted stock units remain outstanding. The Company recognized $35 of stock-based compensation expense for this plan in effect during thethree months ended September 30, 2026 and 2025, respectively. The Company recognized $104 of stock-based compensation expense for this plan in effect during thenine months ended September 30, 2026 and 2025, respectively.

Withholding Taxes on Equity Awards

In connection with the settlement of equity awards, the Company records a non-cash liability and corresponding APIC adjustment for the withholding taxes on net share settlement of stock-based compensation and option exercises until such time as those taxes have been remitted to the respective taxing authorities.

Note 12. Earnings (Loss) Per Share

The Company has two classes of common stock authorized: Class A common stock and Class B common stock. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting. Each share of Class A common stock is entitled toone vote per share and each share of Class B common stock is entitled totwenty-five votes per share. The Company allocates undistributed earnings attributable to common stock between the common stock classes on a one-to-one basis when computing net loss per share. As a result, basic and diluted net income (loss) per share of Class A common stock and Class B common stock are equivalent.

Earnings (loss) per share is computed by dividing net earnings (loss) attributable to common shareholders by the weighted average number of common shares outstanding during the period on a basic and diluted basis. The Company's net (loss) income used in computing diluted earnings per share considers the impact of potentially dilutive securities. Diluted (loss) earnings per share considers the impact of potentially dilutive securities.

The following is a calculation of the basic and diluted loss per share for the Company's common stock, including a reconciliation between net loss attributable to common stockholders used for Basic EPS and Diluted EPS for thethree and nine months ended September 30, 2026 and 2025:

Since the Company was in a net loss position during the three and nine months ended September 30, 2026 and 2025, basic net loss per share attributable to common stockholders is the same as diluted net loss per share as the inclusion of all potential common shares outstanding would have been anti-dilutive. Potential common shares excluded from the diluted net loss per share calculation included convertible debentures, earnout awards, restricted stock units, stock options, employee stock purchase plan shares, and convertible notes (including the GPO convertible note and Dragonfly convertible note) outstanding during the period, as described in Note 7, Debt, Note 9, Earnout Shares and RSUs, and Note 11, Stock-Based Compensation.

Note 13. Provision (Benefit) from Income Taxes

Effective Tax Rate

The Company computes its quarterly and year-to-date provisions for income taxes by applying the estimated effective tax rates to the quarterly and year-to-date pre-tax income or losses and adjusting the provisions for discrete tax items recorded in the periods. For the three months ended September 30, 2026 the Company reported tax expense of$3 on a pre-tax loss of$5,878, which resulted in an effective tax rate of (0.05) percent. For the nine months ended September 30, 2026, the Company reported a tax benefit of$286 on a pre-tax loss of$77,614, which resulted in an effective tax rate of 0.37 percent. The Company’s effective tax rate differed from the U.S. statutory rate of 21% primarily due to the impact of a valuation allowance on the Company’s deferred tax assets.

For the three months ended September 30, 2025, the Company reported a tax benefit of$237 on a pre-tax loss of$25,092, which resulted in an effective tax rate of 0.94 percent. For the nine months ended September 30, 2025, the Company reported a tax benefit of$1,071 on a pre-tax loss of$43,447, which resulted in an effective tax rate of 2.47 percent. The Company’s effective tax rate differed from the U.S. statutory rate of 21% due to the impact of a valuation allowance on the Company’s deferred tax assets and the sale of businesses discussed in Note 3, Dispositions. During the nine months ended September 30, 2025, the Company recorded a discrete tax benefit for the impact of the sale of Dragonfly and Oxford Analytica of $281. During the second quarter ended June 30, 2025, the Company filed a tax accounting method change that created an additional discrete tax benefit of $689.

Unrecognized Tax Benefits and Other Considerations

The Company records liabilities related to its uncertain tax positions. Tax positions for the Company and its subsidiaries are subject to income tax audits by multiple tax jurisdictions throughout the world. The Company believes that it has provided adequate reserves for its income tax uncertainties in all open tax years. As the outcome of the tax audits cannot be predicted with certainty, if any issues arising in the Company's tax audits progress in a manner inconsistent with management's expectations, the Company could adjust its provision for income taxes in the future. As of September 30, 2025, the Company reported an uncertain tax position totaling $832, relating to a deduction for shares distributed for services associated with the payment of convertible debt. At September 30, 2026, the Company hasno uncertain tax positions.

Note 14. Fair Value Measurements and Disclosures

Fair value is defined as the price that would be received to sell an asset or paid to settle a liability in an orderly transaction between market participants at the measurement date. Accounting standards utilize a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels, which are described below:

•

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets

•

Level 2 – Observable inputs other than quoted prices that are either directly or indirectly observable for the asset or

liability

•

Level 3 – Unobservable inputs that are supported by little or no market activity

The carrying value of cash and cash equivalents (including investments with an original maturity ofthree months or less at the date of purchase), restricted cash, accounts receivable, accounts payable, and other accruals readily convertible into cash approximates fair value because of the short-term nature of the instruments.

The following table presents the Company’s financial assets and liabilities accounted for at fair value on a recurring basis as of September 30, 2026 by level within the fair value hierarchy:

The following table presents the Company’s financial assets and liabilities accounted for at fair value on a recurring basis as of December 31, 2025 by level within the fair value hierarchy:

The following table summarizes changes in fair value of the Company’s level 3 liabilities during the periods presented:

(a) - The unrealized change in fair value, as a result of the change in in the Company's specific credit risk, is recorded in accumulated other comprehensive income.

Short-Term Investments

The fair value of the short-term investments is based on the quoted market price of the securities on the valuation date. The Company recognized a non-cash loss of$1 and$4 for thethree months ended September 30, 2026 and 2025. The Company recognized a non-cash loss of$3 and non-cash loss of$67 for the nine months ended September 30, 2026 and 2025, respectively, resulting from the change in fair value of the short-term investments. The change in fair value is recorded in the condensed consolidated statements of operations and comprehensive income (loss). The Company liquidated its balance of short-term investments during the third quarter of 2026, using the proceeds to satisfy its quarterly principal repayment on its 2025 Senior Term Loan on September 30, 2026.

Public Warrants

The fair value of the public warrants is based on the quoted market price of such warrants on the valuation date. As of September 30, 2026 and December 31, 2025, the estimated fair value of the public warrants was$150 and$260, respectively. The Company recognized a non-cash gain of$176 and$276 during the three months ended September 30, 2026 and 2025, respectively, and a non-cash gain of $110 and$785 during the nine months ended September 30, 2026 and 2025, respectively, resulting from the change in fair value of the public warrants. The change in fair value is recorded in change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss).

Private Placement Warrants

As of September 30, 2026 and December 31, 2025, the estimated fair value of the private warrants was $126 and $217, respectively. The Company recognized a non-cash gain of $147 and $231 during thethree months ended September 30, 2026 and 2025, respectively, and a non-cash gain of $91 and$658 during the nine months ended September 30, 2026 and 2025, respectively, resulting from the change in fair value of the private warrants. The change in fair value is recorded in change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss).

2025 GPO Note / Prior GPO Convertible Note

The Prior GPO Convertible Note was recognized as a liability on its June 30, 2023 issuance date at its estimated fair value of$36,583. On August 12, 2025, the Company extinguished $30,000 of the Prior GPO Convertible Note with a $27,000 cash payment and issued the 2025 GPO Note. The 2025 GPO Note was recognized as a liability at its estimated fair value of $18,866 at its issuance date of August 12, 2025, $19,235 at December 31, 2025, and $16,866 at September 30, 2026, respectively. The unrealized change in the fair value of the 2025 GPO Note of$1,043 and $1,677 is recorded in accumulated other comprehensive income for thethree and nine months ended September 30, 2026. The non-cash charge of $347 and $358 for thethree months ended September 30, 2026 and 2025, respectively, and non-cash loss of $1,308 and$358 for the nine months ended September 30, 2026 and 2025, respectively, was recorded in the change in the fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss).

The estimated fair value of the 2025 GPO Convertible Note was determined based on a trinomial lattice model. The following table presents the assumptions used to determine the fair value of the 2025 GPO Convertible Note at September 30, 2026 and at December 31, 2025:

Dragonfly Seller Convertible Notes

The Dragonfly Seller Convertible Notes were recognized as a liability in connection with the acquisition on January 27, 2023 at a fair value of $8,635. As of September 30, 2026 and December 31, 2025, the estimated fair value of the Dragonfly Seller Convertible Notes were $11,963 and $11,982. The non-cash gain of $83 and non-cash charge of $707 was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during thethree months ended September 30, 2026 and 2025, respectively. The unrealized change in the fair value of the Dragonfly Seller Convertible Notes of$717 and $1,080 is recorded in accumulated other comprehensive income forthree and nine months ended September 30, 2026. The non-cash loss of $348 and$770 (excluding the non-cash gain recognized from the January 2025 conversion) was recorded in the change in fair value of financial instruments in the condensed consolidated statements of operations and comprehensive income (loss) during the nine months ended September 30, 2026 and 2025, respectively. The following table presents the assumptions used to determine the fair value of the Dragonfly Seller Convertible Notes at September 30, 2026 and December 31, 2025:

The initial tranche of the Convertible Debentures was recognized as a liability on the August 12, 2025 issuance date at its estimated fair value of $18,900 using a Monte Carlo simulation. The second tranche of the Convertible Debentures was recognized as a liability on September 11, 2025 at its estimated fair value of $11,000, using a Monte Carlo simulation. At September 30, 2026 and December 31, 2025, the estimated fair value of the Convertible Debentures were $20,766 and $26,663, respectively. The non-cash gain of $621 and $2,431 wasrecorded in the change in the fair value of financial instruments in the condensed consolidated statement of operations for the three and nine months ended September 30, 2026. The non-cash loss of $1,403 was recorded in the change of in the fair value of financial instruments in the condensed consolidated statement of operations for the three and nine months ended September 30, 2025, respectively. The following table presents the assumptions used to determine the fair value of the Convertible Debentures at September 30, 2026 and December 31, 2025:

(a) -Includes both the First and Second Convertible Debenture

Non-Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The Company’s long-lived assets, including property and equipment, intangible assets and goodwill are measured at fair value on a non-recurring basis when an impairment has occurred. Excluding the impairment of goodwill as disclosed in Note 6, Goodwill, no other impairment charges were recorded during the three and nine months ended September 30, 2026 and 2025. There wereno transfers of assets or liabilities between levels during thenine months ended September 30, 2026 and 2025. Changes to fair value are recognized as income or expense in the condensed consolidated statements of operations and comprehensive loss.

Note 15. Related Party Transactions

Sublease income

In September 2024, the Company entered into a sublease agreement with a third party, Nitra. In July 2025, the Company amended the initial sublease to include additional space, and in May 2026, the Company further amended the sublease to increase the monthly rent. Our Co-Founder and Executive Chairman is also a board member at Nitra. During the three months ended September 30, 2026 and 2025, we received income from Nitra of approximately$77 and$27, respectively, and$170 and$81 during the nine months ended September 30, 2026 and 2025.

Note 16. Commitments and Contingencies

Legal Proceedings

From time to time the Company is a party to various disputes, claims, lawsuits and other regulatory and legal matters, including both asserted and unasserted legal claims, in the ordinary course of business. The status of each such matter, referred to herein as a loss contingency, is reviewed and assessed in accordance with applicable accounting rules regarding the nature of the matter, the likelihood that a loss will be incurred, and the amounts involved.

Legal fees are recognized as incurred when the legal services are provided, and therefore are not recognized as part of the loss contingency.

Note 17. Subsequent Events

The Company has evaluated subsequent events through November 9, 2026, the date that the financial statements were available to be issued. Since September 30, 2026, YA converted $203 of principal and $17 of accrued interest on the Convertible Debentures in exchange for 20,637,890 shares of the Company’s Class A common stock. In addition, since September 30, 2026, we have also issued 7,407,213 shares in satisfaction of $353 of interest under the 2025 GPO Convertible Note.