Rain Enhancement Technologies Holdco, Inc.
For the period ended Dec 31, 2025. Filed Apr 15, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Apr 15, 2026
RAIN$0.50-6.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-04-16.
0001213900-25-032239
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-04-15.
0001213900-26-044121
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 103 previous paragraphs and 115 current paragraphs.
36 unchanged; 28 reworded; 50 added; 35 removed; 4 previous and 1 current paragraphs rearranged.
Tables are not compared: 0 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (50)
Current report
Since the beginning of 2025 we have continued advancing the commercialization of our technology, including manufacturing and deploying additional rain and snowfall generation systems and conducting field deployments with potential governmental and commercial clients. We have also expanded our network of industry experts and consultants supporting system development, project execution and commercial outreach, and continued research and development activities aimed at improving system performance and exploring potential adjacent atmospheric water applications.
Current report
Restatement
Current report
This Annual Report includes a restatement of our financial statements for the Affected Periods resulting from an error in the accounting for financed insurance premiums as of March 31, 2025 and June 30, 2025. In connection with the restatement, our management reassessed the effectiveness of our internal control over financial reporting and our internal control over financial reporting and our disclosure controls and procedures for the Affected Periods. As a result of that reassessment, we determined that a material weakness existed in the Company’s internal control over financial reporting as of December 31, 2024, and that our disclosure controls and procedures were not effective as of December 31, 2025. For more information, see “Item 9A—Controls and Procedures” in this Annual Report.
Current report
We have not amended our previously filed Quarterly Reports on Form 10-Q for the Affected Periods. The financial information that has been previously filed or otherwise reported for the Affected Periods is superseded by the information in this Annual Report on Form 10-K, and the financial statements and related financial information contained in such previously filed reports should no longer be relied upon.
Current report
The restatement is more fully described in Note 2 of the notes to the audited consolidated financial statements included herein.
Current report
On December 31, 2024 (the “Closing Date”), Coliseum Acquisition Corp., Rain Enhancement Technologies, Inc., Rain Enhancement Technologies Holdco, Inc. (“Holdco”), and the merger subsidiaries consummated the business combination pursuant to the Business Combination Agreement (the “Business Combination”). Following the closing, Holdco became the publicly traded parent company and holds all of the equity interests of RET.
Current report
On January 29, 2025, the Company received $500,000 pursuant to the PIPE Subscription Agreements and issued 43,910 shares of Class A Common Stock. On February 6, 2025, the Company received the remaining $150,000 and issued 13,173 shares of Class A Common Stock. As of February 6, 2025, the subscription receivable had been fully paid.
Current report
As of December 31, 2025, the Company had approximately $9.1 million outstanding under the Loan Agreement, consisting of approximately $3.1 million of rollover amounts and approximately $6.0 million of additional borrowings during 2025.
Current report
On March 11, 2026, the Compensation Committee and the Board approved repayment of the amounts due under the Loan Agreement of up to 30% of any amount received by the Company from any potential future capital raise net of any underwriting, legal, and accounting fees and related costs.
Current report
On March 24, 2026, the Audit Committee and the Board approved an increase in the amount that could be borrowed under the Loan Agreement from $7,000,000 to $10,000,000. The Company and RHY entered into an amendment to the Loan Agreement reflecting such increase, effective as of March 31, 2026.
Current report
Business Developments
Current report
In October 2025, we announced preliminary field observations from a fog-mitigation pilot conducted in Australia using our WETA platform. Initial observations suggested ionization may influence fog dissipation under certain atmospheric conditions. Based on these results, we plan to conduct expanded, instrumented pilot programs in 2026 in the USA (Oregon, California, Utah or Colorado) and Australia to further evaluate performance and use cases. These activities remain in the research and development stage and are not expected to generate material revenue until validation and commercialization.
Current report
Our first two US installed systems entered operation in November 2025. These installations represent the Company’s first operational deployments in the United States and are part of our efforts to evaluate system performance under real-world atmospheric conditions. The systems are located in the La Sal Range of Utah, where we are monitoring snowfall and Snow Water Equivalent (“SWE”) measurements. Preliminary observations during certain periods of system operation coincided with changes in local snowfall and SWE measurements. These observations are preliminary, and additional research and analysis are ongoing to evaluate potential precipitation and snowpack impacts under varying atmospheric conditions.
Current report
During 2025, we also expanded production of our WETA systems and manufactured ten additional units in Australia which were shipped to, and are stored in, the United States intended to support future pilot programs, field deployments and operational readiness. As of December 31, 2025, seven of these units had been completed and were being stored pending deployment. The remaining three units were completed and delivered to the United States in March 2026. Additionally, three systems are currently under construction. These systems are expected to support ongoing research activities, demonstration projects and potential future deployments as we continue to evaluate commercial applications of our technology. Management believes that maintaining an inventory of completed systems may allow the Company to respond more efficiently to pilot opportunities, research collaborations and potential commercial deployments as they arise.
Current report
In addition, we also continued internal development efforts related to potential enhancements to our WETA platform, including instrumentation, data collection and deployment configurations intended to support future pilot programs and operational flexibility. These initiatives remain in development and are being evaluated as part of our broader research and engineering activities. The timing and extent of any future implementation or commercialization of these capabilities remain uncertain.
Current report
Service Agreement with Utah Division of Water Resources
Current report
In January 2026, we entered into a service agreement with the Utah Division of Water Resources to support the installation of a generator to facilitate radiometer data ingestion associated with our rainfall monitoring infrastructure. The agreement provides for payment of $10,500 to us in connection with the installation. We completed the installation and fully received the payment in February 2026.
Current report
In connection with this appointment, Mr. Sylvester entered into a director agreement that is consistent with our form of Director Agreement. which provides for annual cash compensation and potential equity awards subject to approval by the Board and Compensation Committee. As of the date of this Annual Report, no equity awards have been granted to our directors under these agreements.
Current report
On August 19, 2025, we received the Notice from the Staff indicating that we had not regained compliance with either the MVLS Rule or the MVPHS Rule and, unless we timely request a hearing before the Panel, our securities would be subject to suspension and delisting from The Nasdaq Global Market. We timely submitted our request for a hearing before the Panel on August 21, 2025.
Current report
As part of the compliance plan submitted to the Panel, we requested a transfer of our listing from the Nasdaq Global Market to the Nasdaq Capital Market. A hearing before the Panel was held on September 18, 2025 and on October 14, 2025, the Panel granted our request for continued listing on Nasdaq, subject to our timely application to transfer our listing from the Nasdaq Global Market to the Nasdaq Capital Market and demonstrating compliance with the applicable listing requirements. We completed the transfer to the Nasdaq Capital Market and demonstrated compliance with the applicable listing rules. Nasdaq subsequently confirmed that we had regained compliance with its previously disclosed deficiencies,
Current report
On February 18, 2026, we received an additional written notice from Nasdaq indicating that, for the 30 consecutive business days ended February 17, 2026, our MVLS had closed below the $35,000,000 minimum required for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(2). In accordance with Nasdaq rules, we have 180 calendar days, or until August 17, 2026, to regain compliance with the MVLS requirement. To regain compliance, our MVLS must close at or above $35,000,000 for a minimum of ten consecutive business days during this compliance period. We intend to monitor our MVLS and evaluate available options to regain compliance with Nasdaq listing standards; however, there can be no assurance that we will regain or maintain compliance within the applicable compliance period.
Current report
RET currently has two rain and snowfall generation systems installed and placed in service in the United States. These units arrived in the US in September 2025, and began operating in November 2025 and are currently being used to support field observations, data collection and ongoing research activities related to our rainfall generation technology.
Current report
Initial observations from these installations have enabled us to evaluate system performance using available meteorological and radar data. Data collection and analysis remain ongoing as we continue to evaluate system performance and potential atmospheric effects associated with our technology.
Current report
During 2025, we expanded production of our WETA systems and manufactured ten additional units intended to support future pilot programs, field deployments and operational readiness. As of December 31, 2025, seven of these units had been completed and were being stored pending deployment. The remaining three units were completed and delivered to the United States in March 2026. Additionally, three systems are currently under construction. The timing and location of future installations will depend on factors such as site availability, permitting requirements, customer engagement and the results of ongoing testing and evaluation. We expect that some of these systems may be deployed during 2026 as part of pilot programs, demonstration projects or other research initiatives.
Current report
We continue to document sourcing, manufacturing and assembly processes associated with our systems as part of our ongoing development efforts. As part of these efforts, we may evaluate potential supply chain arrangements and manufacturing partners to support future production, although no such arrangements have been finalized.
Current report
Future deployments, if pursued, may involve installing one or more systems within a geographic area as part of pilot programs or demonstration projects. Site selection will consider factors such as weather patterns, terrain, permitting requirements, accessibility and other operational considerations.
Current report
We also continue research and development activities related to instrumentation and measurement tools designed to support monitoring and evaluation of system performance during field deployments. These efforts are intended to assist with the collection and analysis of atmospheric and precipitation data associated with our systems.
Current report
In addition, we may pursue research collaborations with academic institutions or other research organizations to further study atmospheric effects and evaluate the potential impact of our technology in locations where systems are deployed.
Current report
While our systems are currently being deployed primarily for research, pilot and demonstration purposes, the operational experience gained from these deployments is intended to support the continued development of our technology and inform potential future commercial applications.
Current report
Going Concern Consideration
Current report
In connection with our management’s assessment of going concern considerations in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Classification (“ASC”) Subtopic 205-40, “Presentation of Financial Statements - Going Concern,” we evaluate whether there are conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. This assessment considers our current cash position, projected cash requirements, and ability to obtain additional funding.
Current report
As of December 31, 2025, we had approximately $214,000 in cash and had a working capital deficit of approximately $13.0 million. We expect to continue incurring expenses as we scale our operations and begin to generate revenue. We have historically funded our operations primarily through related-party financing arrangements, including borrowings under our line of credit with Mr. You. As of December 31, 2025, we had drawn substantially all available amounts under this facility. While we expect to continue relying on related party financing sources, additional capital raises and projected cash flows from operations, our limited operating history and continuing operating losses raise substantial doubt about our ability to continue as a going concern.
Current report
Management’s plans to address this uncertainty include continued support from related parties, seeking additional financing through debt, equity, or a combination of both, and pursuing commercial opportunities for installation and service agreements. However, there is no assurance that such funding will be available on acceptable terms, or at all.
Current report
During 2025, we incurred installation and field deployment costs associated with the initial deployment and pilot operation of our rain and snowfall generation systems in the United States. These activities were undertaken as part of system validation and research programs and were not associated with revenue-generating customer contracts.
Current report
For the year ended December 31, 2025, we had a net loss of approximately $9.1 million, which consisted of installation costs of approximately $402,000, general and administrative expenses of approximately $7.6 million (primarily related to personnel costs, stock based compensation expense, professional services including annual audit, marketing, and other corporate operating expenses), research and development expenses of approximately $62,000, amortization expense of approximately $12,000, depreciation expense of approximately $7,000, a loss due to the change in fair value of warrant liabilities of $900,000, and interest expenses, minimal tax expenses and interest income from an operating account of approximately $283,000, partially offset by gain from a settlement with vendor of approximately $226,000.
Current report
Commitments and Contingencies
Current report
We entered into a consulting agreement to engage our senior technology advisor, Scott Morris in 2022, pursuant to which we agreed to pay him a one-time fee upon execution of the agreement and a consulting fee of AUD 250,000 per year (equivalent to approximately $170,000 as of the effective date). In February 2025, the agreement was amended to increase the annual consulting fee to $186,000, and in June 2025, it was further increased to $252,000 annually in exchange for the consultant assuming an additional role and responsibilities. The agreement also provides for success fees payable upon the achievement of specified sales and development milestones. On March 19, 2026, the agreement was amended to add three additional milestones, each of which would entitle him to a $25,000 cash bonus. During the year ended December 31, 2025, we paid an aggregate of $50,000 in milestone payments to Mr. Morris in connection with the achievement of certain development milestones.
Current report
Effective January 2, 2025, we entered into a binding offer letter (as amended, the “Offer Letter”), which was later amended on June 27, 2025, with our new CEO, Mr. Seidl. Pursuant to the amended Offer Letter, we agreed to pay to the CEO (i) an annual salary of $500,000, (ii) an annual incentive bonus up to 200% of his base salary, subject to Board or Compensation Committee approval, which will be subject to the achievement of Company and/or individual performance goals mutually agreed by the CEO and the Board or the Compensation Committee, and (iii) a cash bonus of $5.82 million (the “Retention Bonus”) payable on the earlier of (x) December 31, 2028, (y) the date on which we terminate the CEO’s employment without cause, or (z) the date on which a change of control is consummated. We accrue the Retention Bonus over the period of service. As of December 31, 2025, we accrued approximately $831,000 of Retention Bonus and $1 million of annual incentive bonus for 2025 in accrued expenses to related party in the accompanying consolidated balance sheet. On March 16, 2026, the Company paid Mr. Seidl the $1 million annual incentive bonus for 2025 pursuant to the determination and approval of the Compensation Committee.
Current report
In addition, Mr. Seidl is also entitled to an equity award under our equity incentive plan that was approved by the Compensation Committee on August 14, 2025 and by the Board on August 20, 2025. On September 5, 2025, we granted 602,320 RSAs to Mr. Seidl, of which 50% vested on January 1, 2026, and 50% of which shall vest on January 1, 2027, subject to continued employment or service through such vesting date.
Current report
As of December 31, 2025, we had drawn approximately $6.0 million under the LOC, in the combined form of cash proceeds and payments made on behalf of the Company, bringing the total outstanding balance under the Loan Agreement to approximately $9.1 million (including the $3.1 million Rollover).
Showing the first 40 of 50 passages. Open the source sections for the rest.
Removed paragraphs (35)
Previous report
Overview
Previous report
Since the beginning of 2025 we have created new marketing and sales programs, identified and contacted potential customers in core market segments, expanded our contacts with rain enhancement experts who could endorse our technology and introduce us into existing projects looking to address lack of rainfall, and organized our production of systems to serve expected demand.
Previous report
On the Closing Date, Coliseum, RWT, Holdco, Merger Sub 1, and Merger Sub 2 consummated the Business Combination pursuant to the terms of the Business Combination Agreement.
Previous report
Pursuant to the Business Combination Agreement, on the Closing Date, the Mergers occurred, and, after giving effect to such Mergers, the Closing occurred. Following the Closing, Holdco holds all of the equity interests of RWT and Merger Sub 1.
Previous report
Additionally, effective as of April 4, 2025, the Company entered into Director Agreements with Lyman Dickerson, Alexandra Steele, and Christopher Riley, each non-employee members of the Board. The terms of the Director Agreements are consistent with the Company’s standard form of Director Agreement described above, except with respect to the grants of restricted stock to Mr. Dickerson and Mr. Riley, which are as follows: (i) subject to approval by the Board and the Compensation Committee, in lieu of an annual grant of restricted stock, Mr. Dickerson will receive an initial grant of restricted stock equal to the number of shares determined by dividing $2,000,000 by the closing price of the Class A Common Stock on the date of grant, and such grant of restricted stock will vest in full on the third anniversary of the grant date, subject to acceleration in accordance with the terms of the restricted stock award or the Company’s 2024 Incentive Award Plan, and (ii) subject to approval by the Board and the Compensation Committee, Mr. Riley will receive an annual grant of restricted stock equal to the number of shares determined by dividing $50,000 by the closing price of the Class A Common Stock on the date of grant.
Previous report
The grants of restricted stock to each of Mr. Dickerson, Ms. Steele, Mr. Riley, Mr. Peperzak, and Mr. Reardon pursuant to the Director Agreements were deferred by the Board.
Previous report
In accordance with Nasdaq Listing Rule 5810(c)(3)(C), we have 180 calendar days, or until August 18, 2025, to regain compliance with the MVLS Rule. The MVLS Notice notes that, to regain compliance, our MVLS must close at or above $50,000,000 for a minimum of ten consecutive business days during the MVLS Compliance Period. The MVLS Notice further notes that if we are unable to satisfy the MVLS requirement prior to such date, we may be eligible to transfer the listing of its securities to The Nasdaq Capital Market (provided that we then satisfy the requirements for continued listing on that market). If we do not regain compliance by the end of the MVLS Compliance Period, Nasdaq staff will provide written notice to us that our securities are subject to delisting. At that time, we may appeal any such delisting determination to a hearings panel.
Previous report
In accordance with Nasdaq Listing Rule 5810(c)(3)(D), we have 180 calendar days, or until August 18, 2025, to regain compliance with the MVPHS Rule. The MVPHS Notice notes that, to regain compliance, our MVPHS must close at or above $15,000,000 for a minimum of ten consecutive business days during the MVPHS Compliance Period. The MVPHS Notice further notes that if we are unable to satisfy the MVPHS requirement prior to such date, we may be eligible to transfer the listing of its securities to The Nasdaq Capital Market (provided that we then satisfy the requirements for continued listing on that market). If we do not regain compliance by the end of the MVPHS Compliance Period, Nasdaq staff will provide written notice to us that our securities are subject to delisting. At that time, we may appeal any such delisting determination to a hearings panel.
Previous report
We intend to actively monitor our MVLS and MVPHS between now and August 18, 2025, and may, if appropriate, evaluate available options to resolve the deficiencies and regain compliance with the MVLS Rule and MVPHS Rule. While we are exercising diligent efforts to maintain the listing of our securities on Nasdaq, there can be no assurance that we will be able to regain or maintain compliance with Nasdaq listing standards. See “Risk Factors -There can be no assurance that Holdco will be able to comply with the continued listing rules of Nasdaq.”
Previous report
Departure of Co-Chief Executive Officer
Previous report
Mr. Riley’s decision to resign as Chief Executive Officer was not the result of any disagreement with our company or our board of directors, including any matters relating to our operations, polices, accounting practices or financial reporting. Mr. Riley will remain as a member of our board of directors.
Previous report
As previously announced, we appointed Randall Seidl to serve as Co-Chief Executive Officer effective as of January 2, 2025. Following the resignation of Mr. Riley, Mr. Seidl is our sole Chief Executive Officer.
Previous report
RWT currently is warehousing two fully built rain generation systems in Sydney, Australia. The systems were built by a leading ionization rainfall generation engineer, and have undergone rigorous evaluation, testing, and documentation. We plan to ship these units to our U.S. warehouse by May 2025 and expect to execute our first client contract and begin the installation process in the third quarter of 2025. Concurrently, we will identify, recruit, and hire a CTO, CFO and other go to market resources.
Previous report
In March 2025, we began planning the development of ten additional rain generation systems for deployment in new locations. While we have begun documenting the sourcing, manufacturing, and building processes, we will collaborate with highly skilled technical advisors to develop a step-by-step training manual that can be scaled as our system volume increases. While systematically documenting the process, we will also explore ways to enhance efficiency and scalability, such as reviewing the bill of materials to domesticate component sourcing and initiating the request-for-proposal process with prospective U.S.-based manufacturers.
Previous report
We are actively hiring and plan to recruit up to five employees to support sales, operations, or climate science functions by the end of 2025.
Previous report
We plan to host an onsite event, which will include training U.S. personnel on the installation and operation of the systems. As part of this, we will install one of the systems received from Australia inside our warehouse for validation testing, after which it will be re-packed in crates for delivery to the next client site. The second system will be set up for mechanical testing and value engineering work. At that stage, we will assess whether any components are missing or require modifications, placing orders and making necessary repairs as needed. Additionally, that month, we will begin hardware engineering on a variation of the rain generation system designed to meet local permitting requirements for potential installations on public land.
Previous report
We will also plan and prepare for the installation of our system at our first location in August 2025. This process will include securing the services of a general contractor (“GC”) in the area. We will collaborate with the GC to obtain all necessary building permits, which we anticipate will be similar to those required for cell tower installations and should be acquired efficiently and at a reasonable cost.
Previous report
Once the rain generation systems are installed at our first location, we will aim to begin development for rain gauge with our intellectual property to assist with automating the operation of both the installed system and future systems based on local weather conditions.
Previous report
We will also begin finalizing site selection for the region where we plan to install a system in 2025. These regions are expected to host one or more systems to serve one or multiple clients. Our goal is to install the systems in a way that creates contiguous or overlapping areas of potential rainfall enhancement. Depending on updrafts, humidity, and other weather conditions, each installed system is expected to generate rainfall within an approximately 50-mile radius. Site selection will be prioritized based on client engagement, projected returns for the company, and expected local weather and topography. We anticipate that our supply chain will support the manufacturing and installation of additional systems within 5 to 6 months, allowing RWT to scale operations rapidly as client referral effects drive increased demand.
Previous report
We will continue to update and refine internal documentation that outlines the criteria for selecting sites to install and operate the systems. This will include, but not be limited to, factors such as weather patterns, terrain, setbacks, access, prevailing wind direction, and average humidity. Additionally, we plan to enhance our operations process to include a complete set of drawings necessary for permitting, as well as incorporating all feedback received from the site of our initial installation.
Previous report
By the fourth quarter of 2025, we expect to begin operationalizing the manufacturing, testing, and warehousing of devices for the installation pipeline. At that point, we anticipate having well-developed documentation that we can follow to ensure a steady stream of successful system installations.
Previous report
As we continue to refine our manufacturing process for rain technology devices, we will also seek research partnerships with universities. Our goal for these partnerships is to launch a multi-year case study that evaluates the impact of our devices and related technology on rainfall enhancement in the initial U.S. locations where our systems have been installed.
Previous report
Liquidity and Capital Resources
Previous report
As of December 31, 2024, we had approximately $37,000 in cash and had a working capital deficit of approximately $5.4 million. We expect to continue to incur expenses and begin to generate revenues as we continue to grow and scale our business.
Previous report
In connection with the Business Combination, on December 30, 2024, RHY Management LLC (“RHY”), an affiliate of Harry You, entered into the Loan Agreement and agreed to issue a line of credit (the “LOC”) to Holdco for up to $7 million. In addition, Mr. You and his affiliate also agreed to rollover all outstanding amount that Coliseum and RWT owed to them prior to Closing (the “Rollover” under the LOC (such amounts borrowed under the LOC, together with the Rollover, the “Loan”). The Loan has an interest rate of 5%, and interest will be due and payable in arrears quarterly. As of December 31, 2024, the Company has not withdrawn any amount under the $7 million available funding under the LOC and has approximately $3.1 million in Rollover amount outstanding. Subsequent to December 31, 2024, the Company borrowed approximately $839,000 under the LOC.
Previous report
Our management estimates approximately $6.3 million and approximately $62 million in expenses for our one-year and five-year business plan. These funds are expected to be used for producing units, integrating and rolling out software for the rain enhancement platform, expanding water services through the ‘land and expand’ client acquisition model, and potentially acquiring other weather technologies. Since the base technology and products are developed and proven, the need for additional capital will primarily be driven by growth in customer acquisition and projects. Our management believes that the budget can be scaled in line with the funds actually received, enabling RWT to expand its client base, deliver equipment and technology to newly acquired clients, and develop new products for the RWT platform.
Previous report
We expect to fund our future development and exploration activities using the available funding under the LOC and future operating cash flow. The timing of most capital expenditures is largely discretionary. We have a significant degree of flexibility to adjust the level of our capital expenditures as circumstances warrant. If our plans or assumptions change, we may seek additional funding through debt or other equity financing arrangements, implement incremental expense reduction measures or a combination thereof to continue financing our operations. Although our management continues to pursue these plans, there is no assurance that we will be successful in obtaining sufficient funding on terms acceptable to us to fund continuing operations, if at all.
Previous report
Patent and Consulting Agreements
Previous report
In November 2022, RWT entered into a consulting agreement, which was later amended on December 8, 2022, to engage with its senior technology advisor (“Technical Advisor”). RWT agreed to pay the Technical Advisor a one-time fee upon execution of the agreement (“First-time fee”) and a consulting fee of AUD 250,000 per year (equivalent to approximately $170,000 as of the effective date), which was later revised to $186,000 in February 2025, as well as certain bonuses that will be paid upon reaching certain milestones. In May 2023, the Technical Advisor met a significant milestone in improving the design and a bonus of AUD 25,000 was paid in June 2023 (or approximately $13,000).
Previous report
Note Payable and Line of Credit from Related Parties
Previous report
Employment Agreement
Previous report
On December 31, 2024, Holdco entered into a binding offer letter (the “Offer Letter”) with its new CEO, Mr. Seidl effective January 2, 2025, pursuant to which Holdco agreed to pay to the CEO (i) an annual salary of $500,000, (ii) a contingent bonus payment of $5.0 million that will be issued under a form of an unsecured note payable (the “Officer Note”) on the earlier of (x) four-year anniversary of the Officer Note, subject to the CEO’s continued service with Holdco through such date, and (y) the date of termination, if Holdco terminates the CEO’s employment without cause. Holdco and Mr. Seidl agreed to replace the Officer Note, which was not yet issued, with a retention bonus agreement to better reflect the nature of the commitment (“Retention Bonus”). As of the date of this filing, the Retention Bonus has not been issued.
Previous report
Equipment
Previous report
Intangible Assets
Previous report
In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”. The amendments in this ASU expand public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the Chief Operating Decision Maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. We adopted ASU 2023-07, which did not have a material impact on the consolidated financial statements.
Reworded paragraphs (28)
Previous wording
We were founded to provide the world with reliable access to water, one of life’s most important resources. To achieve this mission, we aim to develop, manufacture and commercialize ionization rainfall generation technology.
Current wording
We were founded to provide the world with reliable access to water, one of life’s most important resources. To achieve this mission, we aim to develop, manufacture and commercialize AEI technology.
Previous wording
We are combining unique expertise and personnel to develop, improve and undertake efforts to commercialize ionization rainfall generation technology that enhances rainfall when conditions are appropriate in the atmosphere. We are building our core platform with software, meteorology, hardware, product design and operations to make rainfall generation more dependable. We aim to improve on existing rainfall generation technologies by introducing robust measurement tools, including automation technology, rain gauges, and weather stations, to more precisely quantify the positive water benefit it expects to deliver to millions globally.
Current wording
We are combining unique expertise and personnel to develop, improve and commercialize AEI technology that enhances rainfall and snowfall when conditions are appropriate in the atmosphere. We are building our proprietary WETA platform with software, meteorology, hardware, product design and operations to make rain and snowfall generation more dependable. We aim to improve the existing rain and snowfall generation technologies by introducing robust measurement tools, including automation technology, rain gauges, and weather stations, to more precisely quantify the positive water benefit generated by our systems.
Previous wording
We intend to develop, invent, improve, manufacture, commercialize and operate technologies that enhance rainfall and elevate water reserves. We believe that our future services will yield potable water that can be used for all purposes. The projected cost (not including land costs, which are still being determined) and energy requirements for our future technology are modest on a per gallon basis for communities and ecosystems, estimated to be $0.10 per cubic meter, approximately 10 times less than other alternative technologies. We aim to enhance agricultural, industrial and household water supplies for all the communities in which we operate by developing technology and services to serve governmental and commercial clients’ needs in creating water resiliency and abundancy.
Current wording
We aim to develop, invent, improve, manufacture, commercialize and operate technologies that enhance rainfall and elevate water reserves. We believe that our future services will yield potable water that can be used for all purposes. The projected cost (not including land costs, which are still being determined) and energy requirements for our future technology are modest on a per gallon basis for communities and ecosystems, estimated to be $0.10 per cubic meter, less than other alternative technologies. We aim to enhance agricultural, industrial and household water supplies for all the communities in which we operate by developing technology and services to serve governmental and commercial clients’ needs in creating water resiliency and abundance.
Previous wording
Our business model is based on a unique one-to-many community-centric business model. The numerous client segments to which we market includes large landowners including agriculture, resorts, energy and transportation companies, insurance and reinsurance companies, decarbonization initiatives of major corporations and philanthropists, supranational governmental organizations, and city, county, state, federal and non-U.S. governments. In addition, we aim to leverage our offerings and enhance our potential market position by exploring ways to expand our future water generation products through licensing and acting as a channel partner for additional water generation technologies.
Current wording
Our business model is based on a unique one-to-many community-centric business model. The numerous client segments to which we market include large landowners including agriculture, resorts, energy and transportation companies, insurance and reinsurance companies, decarbonization initiatives of major corporations and philanthropists, supranational governmental organizations, and city, county, state, federal and non-U.S. governments. In addition, we aim to leverage our offerings and enhance our potential market position by exploring ways to expand our future water generation products through licensing and acting as a channel partner for additional water generation technologies.
Previous wording
We have a limited operating history and have not yet generated any revenue, and our ability to generate revenue sufficient to achieve profitability will depend on our ability to successfully build and commercialize rainfall generation technology and successfully execute our sales strategy.
Current wording
We have a limited operating history, and our ability to generate revenue sufficient to achieve profitability will depend on our ability to successfully build and commercialize AEI technology and successfully execute our sales strategy.
Previous wording
The Business Combination was treated as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Coliseum was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of RWT issuing stock for the net assets of Coliseum, accompanied by a recapitalization. The net assets of Coliseum were stated at historical cost, with no goodwill or other intangible assets recorded.
Current wording
The Business Combination was accounted as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Coliseum was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of RET issuing stock for the net assets of Coliseum, accompanied by a recapitalization. The net assets of Coliseum were stated at historical cost, with no goodwill or other intangible assets recorded.
Previous wording
In connection with the Closing, Holdco entered into the PIPE Subscription Agreements with the PIPE Investors and related parties to sell an aggregate of $1.35 million of shares of Holdco Class A Common Stock at $11.39 per share, of which Holdco received $700,000 of the PIPE Investment and recorded a subscription receivable of $650,000 on the consolidated balance sheet as of December 31, 2024. Such receivable was fully paid on February 6, 2025.
Current wording
In connection with the Closing, Holdco entered into subscription agreements (collectively, the “PIPE Subscription Agreements”) with certain investors and related parties (the “PIPE Investors”) to sell an aggregate of 118,557 shares of Holdco Class A Common Stock at a purchase price of approximately $11.39 per share, for gross proceeds of $1.35 million. At the Closing, Holdco received $700,000 of the PIPE investment and issued an aggregate of 61,474 shares of Holdco Class A Common Stock to the PIPE Investors and recorded a subscription receivable of $650,000 for the remaining PIPE investment on the consolidated balance sheet as of December 31, 2024.
Previous wording
On December 30, 2024, Holdco entered into a forward purchase agreement (the “Forward Purchase Agreement”) with Meteora Capital Partners, LP and affiliated funds (“Meteora”) for an OTC equity prepaid forward transaction. An aggregate of 361,858 shares of Holdco Class A Common Stock (the “Forward Purchase Shares”) are subject to the Forward Purchase Agreement, for which Meteora was paid approximately $4.1 million at Closing (the “Prepayment”) and we retained approximately $20,000 (the “Prepayment Shortfall”). The Forward Purchase Agreement matures on the date of the effectiveness of a certain registration statement filed by Holdco with the Securities and Exchange Commission following the Closing Date (the “Maturity Date”). Meteora may sell the Forward Purchase shares at any time following the Closing Date until the Maturity Date at a price not less than $10.00 per share. If Meteora sells any of the Forward Purchase Shares, Meteora will pay to Holdco $10.00 for each share sold, less the Prepayment Shortfall. On Maturity Date, any Forward Purchase Shares that have not been sold by Meteora will be returned to us for no consideration, provided that if the proceeds of the shares sold by Meteora prior to the Maturity Date is less than the Prepayment Shortfall, then we will pay cash to Meteora in an amount equal to such difference.
Current wording
On December 30, 2024, Holdco entered into a forward purchase agreement (the “Forward Purchase Agreement”) with Meteora Capital Partners, LP and affiliated funds (“Meteora”) for an OTC equity prepaid forward transaction. An aggregate of 361,858 shares of Holdco Class A Common Stock (the “Forward Purchase Shares”) are subject to the Forward Purchase Agreement, for which Meteora was paid approximately $4.1 million at Closing (the “Prepayment”) and we retained approximately $20,000 (the “Prepayment Shortfall”). The Forward Purchase Agreement matures on the date of the effectiveness of a certain registration statement filed by Holdco with the Securities and Exchange Commission following the Closing Date (the “Maturity Date”). Meteora may sell the Forward Purchase shares at any time following the Closing Date until the Maturity Date at a price not less than $10.00 per share. If Meteora sells any of the Forward Purchase Shares, Meteora will pay to Holdco $10.00 for each share sold, less the Prepayment Shortfall. On Maturity Date, any Forward Purchase Shares that have not been sold by Meteora will be returned to us for no consideration, provided that if the proceeds of the shares sold by Meteora prior to the Maturity Date is less than the Prepayment Shortfall, then we will pay cash to Meteora in an amount equal to such difference. The forward purchase agreement remains subject to its contractual terms, including settlement provisions tied to the effectiveness of a registration statement.
Previous wording
On December 30, 2024, Holdco entered into the Loan Agreement with RHY, an affiliate of Harry You, pursuant to which RHY committed to provide Holdco with up to $7 million in new loans. Prior to each drawdown, pursuant to the Loan Agreement, Holdco must certify to RHY, among other things, that it has used its best efforts to raise equity, equity-linked, or debt financing on terms available in the market to a similarly-situated company in similar circumstances, and is unable to obtain alternate financing in the amount of such drawdown. Once amounts are borrowed, they may not be re-borrowed. Additionally, Mr. You agreed to roll over an aggregate of approximately $3.1 million of loans and advances owed to him or to his affiliates by Coliseum and RWT into the Loan Agreement and such amounts will be treated for all purposes as loans outstanding pursuant to the Loan Agreement (which, for the avoidance of doubt, does not decrease the $7 million commitment). As of the date of this Annual Report, Holdco has borrowed an additional $839,000 of new funds under the Loan Agreement.
Current wording
On December 30, 2024, Holdco entered into the Loan Agreement with RHY Management LLC (“RHY), an affiliate of Harry You, pursuant to which RHY committed to provide Holdco with up to $7 million in new loans. In addition, approximately $3.1 million of existing loans and advances owed to Mr. You and his affiliates were rolled into the Loan Agreement.
Previous wording
On April 1, 2025, the Board increased the size of the Board from five to seven directors and appointed Mr. Marcus Peperzak and Mr. Robert Reardon to fill the resulting vacancies. Mr. Reardon was appointed to serve as a Class I director with a term expiring at the Company’s first annual meeting of stockholders. Mr. Peperzak was appointed to serve as a Class II director with a term expiring at the second annual meeting of stockholders. Following the appointment, Mr. Peperzak and Mr. Reardon serve on the Audit Committee.
Current wording
On December 22, 2025, the holders of Class B Common Stock appointed Mr. David Sylvester as a Class II director with a term expiring at the second annual meeting of stockholders, and the Board increased the size of the Board from seven to eight directors and appointed Mr. Sylvester as Chairperson of the Audit Committee. Following the appointment, Mr. Sylvester, Mr. Peperzak and Mr. Reardon serve on the Audit Committee.
Previous wording
On February 18, 2025, we received the MVLS Notice from Nasdaq which notified the Company that, for the 30 consecutive business days ended February 14, 2025, our MVLS closed below the $50,000,000 MVLS threshold required for continued listing on the Nasdaq Global Market under Nasdaq Listing Rule 5450(b)(2)(A).
Current wording
On February 18, 2025, we received the MVLS Notice from the Staff of the Nasdaq which notified us that, for the 30 consecutive business days ended February 14, 2025, our MVLS closed below the $50,000,000 MVLS threshold required for continued listing on the Nasdaq Global Market under the MVLS Rule. Also on February 18, 2025, we received the MVPHS Notice from Nasdaq that for the 30 consecutive business days ended February 14, 2025, our MVPHS closed below the $15,000,000 MVPHS threshold required for continued listing on Nasdaq under Nasdaq Listing Rule 5450(b)(2)C).
Previous wording
The MVLS Notice and MVPHS Notice are notifications of deficiency, not of imminent delisting, and have no immediate effect on the listing of our securities. Our Class A Common Stock and Warrants continue to trade on Nasdaq under the symbols “RAIN” and “RAINW”, respectively.
Current wording
Our Class A common stock and warrants continue to trade under the symbol “RAIN” and “RAINW”, respectively.
Previous wording
In connection with the Company’s assessment of going concern considerations in accordance with FASB ASC Subtopic 205-40, “Going Concern,” our management has determined that although we do not have sufficient liquidity to meet our anticipated obligations over the next year from the date of issuance of these consolidated financial statements, we have access to funds under the LOC. Additionally, an existing shareholder has pledged financial support as necessary and has the financial ability to provide such funds, that are sufficient to fund our working capital needs over the next twelve months from the date of issuance of these consolidated financial statements.
Current wording
Accordingly, our management has determined that we do not have sufficient liquidity to meet our anticipated obligations over the next year from the date of issuance of these consolidated financial statements. The consolidated financial statements included in this Annual Report do not include any adjustments that might result from the outcome of this uncertainty.
Previous wording
For the year ended December 31, 2023, we had net loss of approximately $437,000, which consisted mainly of general and administrative expenses of approximately $410,000 and interest expense in connection with the note payable to related parties of approximately $27,000.
Current wording
For the year ended December 31, 2024, we had net loss of approximately $4.5 million, which consisted mainly of general and administrative expenses of approximately $4.5 million and interest expense in connection with the note payable to related parties of approximately $30,000.
Previous wording
For the year ended December 31, 2023, net cash used in operating activities was approximately $238,000, net cash used in investing account was approximately $264,000, and net cash provided by financing activities was approximately $440,000. Net loss of approximately $437,000 was affected by stock based compensation expense of approximately $3,800, amortization expense of $12,000, expenses paid by related parties on behalf of RWT of approximately $11,000, and changes in operating assets and liabilities used approximately $171,000 of cash for operating activities. Cash used in investing activities consisted solely of payment for building Equipment of approximately $264,000. Cash provided by financing activities resulted from issuance of common stock and Series A preferred stock of $1,998 and $8,000, respectively, and from the remaining proceeds of approximately $447,000 pursuant to the Note, partially offset by repayment off advances to certain officer approximately $17,000.
Current wording
For the year ended December 31, 2025, net cash used in operating activities was approximately $2.0 million, net cash used in investing activities was approximately $987,805, and net cash provided by financing activities was approximately $3.1 million. Net cash used in operating activities included our net loss of approximately $9.1 million, and a gain from the settlement with a vendor of approximately $226,000, partially offset by changes in operating assets and liabilities of approximately $1.3 million, amortization expense of approximately $12,000, depreciation expense of approximately $7,000, approximately $3.5 million paid by related parties on behalf of RET, stock-based compensation expenses of approximately $1.6 million and a change in the fair value of a warrant liabilities of $900,000. Cash used in investing activities consisted solely of payment for building Equipment of approximately 987,805. Cash provided by financing activities resulted from proceeds from payment of subscription receivable of $650,000 and proceeds from drawdowns under the LOC (as defined below) of approximately $2.5 million.
Previous wording
For the year ended December 31, 2024, net cash used in operating activities was approximately $1.3 million, net cash used in investing account was approximately $46,000, and net cash provided by financing activities was approximately $1.4 million. Net loss of approximately $4.5 million was partially offset by non-cash activities, including stock-based compensation expense of approximately $2.8 million, amortization expense of approximately $12,000, and expenses paid by related parties on behalf of RWT of approximately $321,000, and also changes in operating assets and liabilities used approximately $44,000 of cash for operating activities. Cash used in investing activities consisted solely of payment for building Equipment of approximately $46,000. Cash provided by financing activities resulted from (i) issuance of RWT Class A and RWT Class B common stock of $740,000 and $125,000, respectively, (ii) cash proceeds from issuance of Holdco Class A common stock in connection with PIPE subscriptions of $700,000, and (iii) proceeds from reverse recapitalization in connection with the Business Combination, partially offset by payment of deferred financing costs of $75,000 and payment of prepaid Forward Purchase Agreement with Meteora of approximately $4.1 million.
Current wording
For the year ended December 31, 2024, net cash used in operating activities was approximately $1.3 million, net cash used in investing activities was approximately $46,000, and net cash provided by financing activities was approximately $1.4 million. Net cash used in our operating activities included our net loss of approximately $4.5 million, partially offset by non-cash activities, including stock-based compensation expense of approximately $2.8 million, amortization expense of approximately $12,000, and expenses paid by related parties on behalf of RET of approximately $321,000, and changes in operating assets and liabilities. Cash used in investing activities consisted solely of payment for building Equipment of approximately $46,000. Cash provided by financing activities resulted from (i) the issuance of RET Class A and RET Class B common stock of $740,000 and $125,000, respectively, (ii) cash proceeds from the issuance of Holdco Class A common stock in connection with PIPE subscriptions of $700,000, and (iii) proceeds from the reverse recapitalization in connection with the Business Combination, partially offset by payment of deferred financing costs of $75,000 and payment of the prepaid Forward Purchase Agreement with Meteora of approximately $4.1 million.
Previous wording
On November 21, 2022, RWT entered into a license agreement with Dr. Theodore Anderson, a plasma physicist, whereby RWT was granted an exclusive, worldwide license under certain of Dr. Anderson’s patents. The consideration paid for the license of $33,000, which was fully paid in November 2022, was recorded as a finite-lived intangible asset.
Current wording
On November 21, 2022, RET entered into a license agreement with Dr. Theodore Anderson, a plasma physicist, whereby RET was granted an exclusive, worldwide license under certain of Dr. Anderson’s patents. The consideration paid for the license of $33,000, which was fully paid in November 2022, was recorded as a finite-lived intangible asset.
Previous wording
In connection with the consulting agreement, we also agreed to obtain from the Technical Advisor an irrevocable, perpetual, non-exclusive license under certain engineering designs in connection with rainfall ionization equipment and systems. We fully paid this amount of $83,750 in June 2023.
Current wording
In connection with the consulting agreement, we also agreed to obtain from Mr. Morris an irrevocable, perpetual, non-exclusive license under certain engineering designs in connection with rainfall ionization equipment and systems. We fully paid this amount of $83,750 in June 2023.
Previous wording
On January 29, 2025, Holdco, RWT and Christopher Riley entered into a letter agreement whereby Mr. Riley resigned as Co-Chief Executive Officer of our company and RWT effective as of January 30, 2025 (the “Termination Letter”). Pursuant to the Termination Letter, in lieu of all other compensation and payments of any kind due and payable to Mr. Riley, Mr. Riley will be paid for services rendered in an amount of $124,500, payable in 18 monthly installments beginning in February 2025. Additionally, conditioned on approval by the Compensation Committee of our board of directors, the Termination Letter provides that Mr. Riley will be granted 10,000 shares of Class A Common Stock of the Company vesting one year from the date of grant.
Current wording
In January 2025, we entered into a termination letter agreement with our former CEO, Mr. Christopher Riley, pursuant to which, in lieu of all other compensation and payments, we agreed to pay Mr. Riley an aggregate of $124,500, payable in 18 monthly installments beginning in February 2025 in consideration for his past services. As of December 31, 2025, we had an aggregate of approximately $48,000 in outstanding amount in connection with such agreement that was included in accrued expenses in the accompanying consolidated balance sheet. Additionally, conditioned on approval by the Compensation Committee, the Termination Letter provides that Mr. Riley will be granted 10,000 shares of Class A Common Stock vesting one year from the date of grant. As of December 31, 2025, the stock has not been granted.
Previous wording
On February 2, 2023, RWT issued a promissory note (the “Note”) to its former CEO and Mr. You and Mr. de Masi for an aggregate amount of $600,000. The Note has an annual interest rate of 5% and is currently due on demand.
Current wording
On February 2, 2023, RET issued a promissory note (the “Note”) to its former CEO, Mr. You, and Mr. de Masi for an aggregate amount of $600,000. The Note has an annual interest rate of 5%. The Note amount owed to RET’s former CEO and Mr. de Masi totaling $400,000 remains as outstanding due on demand, and the $200,000 Note amount owed to Mr. You was included in the Rollover amount described below.
Previous wording
On December 30, 2024, Holdco entered into the Loan Agreement with RHY, an affiliate of Harry You, pursuant to which RHY agreed to issue an LOC to Holdco for up to $7 million, in addition to the Rollover amount described below. The Loan has an interest rate of 5%, and interest will be due and payable in arrears quarterly.
Current wording
On December 30, 2024, Holdco entered into the Loan Agreement with RHY, an affiliate of Harry You, pursuant to which RHY agreed to issue a line of credit (the “LOC”) to Holdco for up to $7 million, in addition to the Rollover amount described below (such amounts borrowed under the LOC, together with the Rollover, the “Loan”). The Loan bears interest at the greater of 5% per annum or the applicable IRS short-term rate in the month of each drawdown (“Interest Rate”), payable quarterly in arrears. If a quarterly payment is missed, the loan balance increases by an amount equal to the principal multiplied by the 2% Default Rate (as defined below). If an event of default has occurred and is continuing, then upon written notice by RHY to Holdco, the outstanding principal balance and any unpaid accrued interest will accrue interest at 2% above the Interest Rate (the “Default Rate”).
Previous wording
Prior to Closing, the outstanding amount that Coliseum and RWT owed to Mr. You and his affiliates are: (i) approximately $1.7 million and approximately $333,000 of advances to Coliseum and RWT, respectively, (ii) convertible note balance of $667,500 to Coliseum, and a portion under the Note discussed above of approximately $216,000 to RWT (which amount includes $200,000 in principal and approximately $16,000 in accrued interest), and (iii) an outstanding balance of $180,000 in accrued administrative fees to Coliseum, for a total of approximately $3.1 million. The Rollover amounts were assigned to and assumed by Holdco and are treated for all purposes as Loans outstanding under the Loan Agreement. The Rollover amount does not reduce the $7 million funding available to the Company under the LOC. As of December 31, 2024, we had not borrowed any of the $7 million available funding under the LOC.
Current wording
Prior to closing of the Business Combination, the outstanding amount that Coliseum and RET owed to Mr. You and his affiliates was approximately $3.1 million. The Rollover amounts were assigned to and assumed by Holdco and are treated for all purposes as Loans outstanding under the Loan Agreement. The Rollover amount does not reduce the $7 million funding available to us under the LOC. As a result, as of December 31, 2024, we had approximately $3.1 million outstanding under the LOC, comprised solely of the Rollover amount.
Previous wording
In connection with this appointment, Mr. Reardon and Mr. Peperzak each entered into a Director Agreement (as defined below) that is consistent with the Company’s form of Director Agreement. Under the Director Agreement, members of the Board will receive compensation for service on the Board and on committees of the Board consisting of the following: (i) subject to approval by the Board and compensation committee of the Board (the “Compensation Committee”), a cash payment of $12,500 promptly following attendance at each quarterly Board meeting, for a total annual cash compensation of $50,000; and (ii) at the beginning of each year of service, and subject to approval by the Board and the Compensation Committee, a grant of restricted stock, with the number of shares determined by dividing $100,000 by the closing price of the Company’s Class A common stock, par value $0.0001 per share (“Class A Common Stock”) as reported on the Nasdaq Stock Market LLC on the date of the grant. The restricted stock granted pursuant to the Director Agreement will vest in full on the first anniversary of the grant date, subject to acceleration in accordance with the terms of the restricted stock award or the Company’s 2024 Incentive Award Plan.
Current wording
In connection with their appointments to the Board, Mr. Reardon, Mr. Peperzak, and Mr. Sylvester each entered into the Director Agreements which are the form of agreement adopted by the Board in April 2025 to govern the terms of service and compensation of our company’s non-employee directors. Additionally, effective as of April 4, 2025, we entered into Director Agreements with Lyman Dickerson, Alexandra Steele, and Christopher Riley, each non-employee members of the Board. Pursuant to the terms of the Director Agreements, we agreed to pay to each Board member (i) subject to approval by the Board and Compensation Committee, a cash payment of $12,500 promptly following attendance at each quarterly Board meeting, for a total annual cash compensation of $50,000; and (ii) subject to approval by the Board and the Compensation Committee, a grant of restricted stock, with the number of shares and terms to be determined by the Board. We recognized an aggregate of $225,000 in connection with such agreement during the year ended December 31, 2025 within general and administrative expenses in the accompanying consolidated statements of operations. As of December 31, 2025, there has been no grants of restricted stock to the directors.
Previous wording
We operate and manage the business as one reportable and operating segment, which is the business of developing, manufacturing and commercializing ionization rainfall generation technology. Our chief executive officer, who is the chief operating decision maker, or CODM, reviews financial information on an aggregate basis for allocating resources and evaluating financial performance.
Current wording
We operate and manage the business as one reportable and operating segment, which is the business of developing, manufacturing and commercializing AEI technology. Our chief executive officer, who is the chief operating decision maker, or CODM, reviews financial information on an aggregate basis for allocating resources and evaluating financial performance.
Previous wording
Preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. We also make estimates and assumptions on revenue generated and reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that it believes are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
Current wording
Preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. We also make estimates and assumptions on revenue generated and reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
Previous wording
While our significant accounting policies are described in the notes to our consolidated financial statements included elsewhere in this Annual Report, our management believes there was no critical accounting estimates identified during the years ended December 31, 2024 and 2023.
Current wording
While our significant accounting policies are described in the notes to our consolidated financial statements included elsewhere in this Annual Report, our management believes there were no critical accounting estimates identified during the years ended December 31, 2025 and 2024.
Previous wording
We capitalize our cost to build its rainfall ionization equipment (the “Equipment”), including materials and allocated labor costs. In July 2023, we finished building the Equipment and transferred its capitalized cost from Construction in-process to Equipment. As soon as the Equipment is placed in service upon agreement with the customers, we will begin to depreciate those assets on a straight- line basis over the estimated useful lives of the assets, generally 10 to 15 years. At the time of retirement or other disposition of the Equipment, the cost and accumulated depreciation will be removed from the accounts and the resulting gain or loss, if any, will be reflected in operations. As of December 31, 2024, no Equipment has been placed in service.
Current wording
Depreciation begins when the equipment is placed into service and is recorded on a straight-line basis over the estimated useful life of the assets, which we currently estimate to be 10 years. At the time of retirement or other disposition of the Equipment, the cost and accumulated depreciation will be removed from the accounts and the resulting gain or loss, if any, will be reflected in operations.
Previous wording
In December 2023, the FASB issued ASU No. 2023-09 (Topic 740), Improvements to Income Tax Disclosures. The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as an expansion of other income tax disclosures. The ASU is effective on a prospective basis for annual reporting periods beginning after December 15, 2024. We are currently evaluating the impact this ASU will have on our consolidated financial statements and related disclosures.
Current wording
In December 2023, the FASB issued ASU No. 2023-09 (Topic 740), Improvements to Income Tax Disclosures. The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as an expansion of other income tax disclosures. The ASU is effective on a prospective basis for annual reporting periods beginning after December 15, 2024. The Company adopted ASU 2023-09 in its fourth quarter of 2025 for the period ending December 31, 2025, and the adoption impacted only the disclosures with no material impact on the Company’s consolidated financial statements.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
On April 1, 2025, the Board increased the size of the Board from five to seven directors and appointed Mr. Marcus Peperzak and Mr. Robert Reardon to the Board to fill the resulting vacancies. On December 22, 2025, the Board further increased its size from seven to eight directors and appointed Mr. David Sylvester as a Class II director.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Previous report — wording carried elsewhere
On the Closing Date, the Company closed on $700,000 of investment pursuant to the PIPE Subscription Agreements and issued an aggregate of 61,474 shares of Class A Common Stock to the PIPE Investors and recorded a subscription receivable of $650,000 from two PIPE Investors for the purchase of 57,083 shares of Class A Common Stock. On January 29, 2025, the Company closed $500,000 of such subscription receivable pursuant to the PIPE Subscription Agreements and issued an aggregate of 43,910 shares of Class A Common Stock to the PIPE Investors. On February 6, 2025, the Company closed on the remaining $150,000 of subscription receivable pursuant to the PIPE Subscription Agreements and issued an aggregate of 13,173 shares of Class A Common Stock to the PIPE Investors.
Previous report — wording carried elsewhere
Also on February 18, 2025, we received the MVPHS Notice from Nasdaq that for the 30 consecutive business days ended February 14, 2025, our MVPHS closed below the $15,000,000 MVPHS threshold required for continued listing on Nasdaq under Nasdaq Listing Rule 5450(b)(2)C).
Previous report — wording carried elsewhere
For the year ended December 31, 2024, we had net loss of approximately $4.5 million, which consisted mainly of general and administrative expenses of approximately $4.5 million and interest expense in connection with the note payable to related parties of approximately $30,000. The Company experienced higher expenses compared to previous years due to the merger completed on December 31, 2024.