Rain Enhancement Technologies Holdco, Inc.
For the period ended Jun 30, 2026. Filed Aug 14, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 14, 2026
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-Q
Period ended 2026-03-31; filed 2026-05-15.
0001213900-26-057838
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-14.
0001213900-26-090166
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 107 previous paragraphs and 114 current paragraphs.
64 unchanged; 30 reworded; 19 added; 12 removed; 1 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 (19)
Current report
On June 5, 2026, we entered into an agreement to convert a portion of the Loan owed to RHY and its affiliates (the “Conversion Agreement”), pursuant to which an aggregate of $4,000,000 of Loan was converted into 1,612,903 shares of Class A Common Stock at a price per share equal to the volume-weighted average price of the Class A Common Stock for the ten trading days preceding the date of the Conversion Agreement, which was $2.48 per share.
Current report
Subsequent to June 30, 2026, we borrowed additional amounts under the LOC in the aggregate amount of approximately $426,000, increasing the outstanding balance under the LOC to approximately $8.9 million. On August 10, 2026, the Company repaid approximately $555,000 of accrued interest under the LOC to the lender.
Current report
Government Projects and Commercial Developments
Current report
In July 2026, the Colorado Water Conservation Board, the Colorado River District, and the Upper Yampa Water Conservancy District publicly supported our pending application for a weather enhancement pilot project in Colorado. If approved, the project would represent our first commercial deployment of our AEI technology and is expected to be funded through a grant administered by the Colorado Water Conservation Board.
Current report
On August 5, 2026, we entered into an exclusive representation and equipment lease agreement with Ulusal Atmosferik Sistemler Ve Iklim Teknolojileri Sanayi Ve Ticaret Anonim Sirketi (“UASIT”), a Turkey-based company focused on water resource management, climate adaptation and mitigation, sustainable agriculture and forestry management. Under the agreement, UASIT became RET's exclusive representative for the deployment of our WETA platform in the Republic of Turkey. The agreement also provides for the lease of two WETA units for an initial term of 60 months subject to certain performance metrics, and includes renewal and purchase option provisions, subject to the terms and conditions of the agreement. The agreement is contingent upon the Company receiving an order for the leased units on or before December 31, 2026.
Current report
The initial focus of the partnership will be the Eğirdir Lake Basin in Isparta Province, where RET and UASIT intend to evaluate the WETA platform's potential to support natural precipitation and improve water security for drinking water supply, agricultural irrigation, and lake and reservoir management. RET and UASIT also intend to evaluate potential pilot opportunities in other water-stressed regions of Turkey, including the İzmir region, Central Anatolia, the Mediterranean region, and Southeastern Anatolia, subject to appropriate conditions and institutional approvals.
Current report
We believe this agreement represents an additional step in the commercialization of our WETA technology; however, there can be no assurance that the conditions to the agreement will be satisfied or that the anticipated commercial activities will occur.
Current report
At-the-Market Offering Program
Current report
On June 30, 2026, we entered into a Sales Agreement (the “Sales Agreement”) with Needham & Company, LLC (“Needham”), pursuant to which we may offer and sell, from time to time, shares of our Class A common stock having an aggregate offering price of up to approximately $3.5 million through Needham. Any sales of shares under the Sales Agreement will be made pursuant to our effective shelf registration statement on Form S-3, including the related prospectus supplement.
Current report
Needham will be entitled to compensation of up to 3.0% of the gross sales price of any shares sold under the Sales Agreement. We have also agreed to reimburse certain expenses of Needham and to provide customary indemnification, representations, warranties and covenants under the terms of the Sales Agreement.
Current report
We intend to use the net proceeds from sales of common stock, if any, under the Sales Agreement primarily for working capital, capital expenditures and other general corporate purposes.
Current report
Sales of shares under the Sales Agreement, if any, may be made in transactions that are deemed to be “at-the-market offerings,” as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended (“ATM program”). We are not obligated to sell any shares under the Sales Agreement and may suspend or terminate the offering at any time in accordance with the terms of the Sales Agreement. During the three and six months ended June 30, 2026, no shares of our Class A common stock were issued or sold under the Sales Agreement. As of June 30, 2026, an aggregate of approximately $3.5 million remained available for sale under the ATM program.
Current report
Subsequent to June 30, 2026, we sold an aggregate of 1,362,315 shares of our Class A common stock under the ATM program for gross proceeds of approximately $2.3 million and incurred approximately $309,000 in allocated offering costs.
Current report
New RSAs Issuance
Current report
On June 5, 2026, we issued an aggregate of 540,000 shares of Class A common stock pursuant to our 2024 Equity Incentive Plan as follows: (i) 80,000 shares were issued to each of Lyman Dickerson, Alexandra Warsh (professionally known as Alexandra Steele), Robert Reardon, and Marcus Peperzak, 50,000 shares were issued to Christopher Riley, and 40,000 shares were issued to David Sylvester, each directors of our company, as payment of director compensation pursuant to their director agreements (see Note 7), (ii) 50,000 shares of to its Interim Chief Financial Officer, (iii) 50,000 shares were issued to Mr. Morris, and (iv) 30,000 shares were granted to Christopher Monroe, an independent contractor. All of these shares were fully vested upon issuance.
Current report
For the three months ended June 30, 2025, we had net loss of approximately $953,000, which consisted of general and administrative expenses of approximately $1.1 million (primarily related to personnel costs, professional services including quarterly audit, marketing, and other corporate operating expenses), amortization expenses of approximately $3,000, a loss due to change in fair value of warrant liability of $72,500, and interest expenses and minimal tax expenses and interest income from operating account of approximately $34,000, partially offset by gain from settlement with vendor of approximately $226,000.
Current report
For the six months ended June 30, 2025, we had net loss of approximately $2.4 million, which consisted of general and administrative expenses of approximately $2.4 million (primarily related to personnel costs, professional services including annual audit, marketing, and other corporate operating expenses), amortization expenses of approximately $6,000, a loss due to change in fair value of warrant liability of $162,500, and interest expenses and minimal tax expenses and interest income from operating account of approximately $81,000, partially offset by gain from settlement with vendor of approximately $226,000.
Current report
The Termination Letter also provides that, subject to approval by our Compensation Committee of the Board, Mr. Riley will be granted 10,000 shares of our Class A common stock that vest one year from the date of grant. Mr. Riley continues to serve as a member of the Board and is eligible to receive equity awards under our non-employee director compensation program as discussed below. On June 5, 2026, we granted Mr. Riley an equity award of 50,000 shares of Class A common stock.
Current report
Board of Directors Agreement
Removed paragraphs (12)
Previous report
As of December 31, 2025, we 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.
Previous report
Effective as of March 31, 2026, the Company and RHY entered into an amendment to the Loan Agreement to increase the amount that could be borrowed under the Loan Agreement from $7,000,000 to $10,000,000.
Previous report
Service Agreement with Utah Division of Water Resources
Previous report
For the three months ended March 31, 2025, we had net loss of approximately $1.5 million, which consisted of general and administrative expenses of approximately $1.3 million, amortization expenses of approximately $3,000, loss in change in fair value of warrant liability of $90,000, and interest expense in connection with the note payable to related parties of approximately $47,000. We experienced higher expenses compared to previous years due to the merger completed on December 31, 2024.
Previous report
Related Party Transactions
Previous report
Note Payable and Line of Credit from Related Parties
Previous report
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 report
On December 30, 2024, the Company 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 the Company for up to $7 million, which was later amended on March 31,2026 to increase to the available funding to $10 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 the Company, the outstanding principal balance and any unpaid accrued interest will accrue interest at 2% above the Interest Rate (the “Default Rate”).
Previous report
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 the Company 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.
Previous report
As of March 31, 2026 and December 31, 2025, we had an outstanding accrued interest balance in connection with both the Note and the LOC of approximately $462,000 and $323,000, respectively.
Previous report
Effective as of March 31, 2026, the Company and RHY entered into an amendment to the Loan Agreement to increase the amount that could be borrowed under the Loan Agreement from $7,000,000 to $10,000,000.
Previous report
Board Agreement
Reworded paragraphs (30)
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 AEI 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 atmospheric enhancement by ionization (AEI) technology.
Previous 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.
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 Weather Enhancement Technology Array (“WETA”) platform with software, meteorology, hardware, product design and operations to make rain and snowfall enhancement more dependable. We aim to improve the existing rain and snowfall enhancement 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
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 wording
Since the beginning of 2025 we have continued advancing the commercialization of our technology, including manufacturing and deploying additional rain and snowfall enhancement 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.
Previous wording
On December 31, 2024 (the “Closing Date”), the Company, RET, Coliseum Acquisition Corp., and the merger subsidiaries consummated the business combination pursuant to the Business Combination Agreement (the “Business Combination”). Following the closing, the Company became the publicly traded parent company and holds all of the equity interests of RET.
Current wording
On December 31, 2024 (the “Closing Date”), our company, RET, Coliseum Acquisition Corp., and the merger subsidiaries consummated the business combination pursuant to the Business Combination Agreement (the “Business Combination”). Following the closing, we became the publicly traded parent company and holds all of the equity interests of RET.
Previous 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.
Current wording
The Business Combination was accounted for 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, the Company 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 Class A common stock at a purchase price of approximately $11.39 per share, for gross proceeds of $1.35 million. At the Closing, the Company received $700,000 of the PIPE investment 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 for the remaining PIPE investment on the consolidated balance sheet as of December 31, 2024.
Current wording
In connection with the Closing, we 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 Class A common stock at a purchase price of approximately $11.39 per share, for gross proceeds of $1.35 million. At the Closing, we received $700,000 of the PIPE investment 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 for the remaining PIPE investment on the consolidated balance sheet as of December 31, 2024.
Previous wording
On December 30, 2024, the Company 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 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 the Company 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 the Company $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.
Current wording
On December 30, 2024, we 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 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 $21,000 (the “Prepayment Shortfall”). The Forward Purchase Agreement matures on the date of the effectiveness of a certain registration statement filed by us 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 us $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, the Company entered into the Loan Agreement with RHY Management LLC (“RHY), an affiliate of Harry You, pursuant to which RHY committed to provide the Company 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.
Current wording
On December 30, 2024, we entered into the Loan Agreement with RHY Management LLC (“RHY), an affiliate of Harry You, pursuant to which RHY committed to provide us with up to $7 million in new loans, which was later amended on March 31, 2026 to increase the loan commitment to up to $10 million. 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 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 us from any potential future capital raise net of any underwriting, legal, and accounting fees and related costs.
Current wording
On March 11, 2026, our Compensation Committee and the Board approved repayment of the amounts due under the Loan Agreement of up to 30% of any amount received by us from any potential future capital raise net of any underwriting, legal, and accounting fees and related costs.
Previous wording
We had drawn approximately $8.7 million and $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 $11.8 million $9.1 million (including the $3.1 million Rollover) as of March 31, 2026 and December 31, 2025, respectively.
Current wording
As of June 30, 2026 and December 31, 2025, we had outstanding balance of approximately $8.5 million and $9.1 million (including the $3.1 million Rollover) under the Loan Agreement, respectively.
Previous wording
We continued to monitor our first two US installed systems entered operation in November 2025. These installations represent our 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 wording
Our first two US installed systems entered operation in November 2025. These installations represent our 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.
Previous wording
As of March 31, 2026, 10 additional units were completed and delivered to the United States. 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 us to respond more efficiently to pilot opportunities, research collaborations and potential commercial deployments as they arise.
Current wording
As of June 30, 2026, we had 10 additional units completed and available for service placement. 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 us to respond more efficiently to pilot opportunities, research collaborations and potential commercial deployments as they arise.
Previous wording
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, received payment for the services in February 2026, and recognized revenue of $10,500 upon completion of the installation, which represents the satisfaction of our performance obligation in accordance with ASC 606. This activity is not part of our primary operations related to its AEI technology and is considered incidental in nature. We have not generated revenue from its core business activities to date.
Current wording
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 provided for payment of $10,500 to us in connection with the installation. We completed the installation, received payment for the services in February 2026, and recognized revenue of $10,500 upon completion of the installation, which represents the satisfaction of our performance obligation in accordance with ASC 606. This activity is not part of our primary operations related to our AEI technology and is considered incidental in nature. We have not generated revenue from our core business activities to date.
Previous wording
RET currently has two rain and snowfall generation systems installed and placed in service in the United States 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 wording
RET currently has two rain and snowfall enhancement systems installed and placed in service in the United States in November 2025, which are currently being used to support field observations, data collection and ongoing research activities related to our rainfall generation technology.
Previous wording
As of March 31, 2026, ten additional units was completed and delivered to the United States. These units are intended to support future pilot programs, field deployments and operational readiness. 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 wording
As of June 30, 2026, we had 10 additional units completed and available for service placement. These units are intended to support pilot programs, field deployments and operational readiness. 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.
Previous wording
As of March 31, 2026, we had approximately $581,000 in cash and had a working capital deficit of approximately $14.8 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 loan agreement with Mr. You. As of March 31, 2026, we had approximately $1.3 million in remaining amount available 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 wording
As of June 30, 2026, we had approximately $33,000 in cash and had a working capital deficit of approximately $13.1 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 loan agreement with Mr. You. As of June 30, 2026, we had approximately $1.5 million in remaining amount available 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.
Previous wording
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 wording
Management’s plans to address this uncertainty include continued support from related parties, utilizing the Company’s at-the-market offering program, 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.
Previous 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 unaudited condensed consolidated financial statements. The unaudited condensed consolidated financial statements included in this Annual Report do not include any adjustments that might result from the outcome of this uncertainty.
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 unaudited condensed consolidated financial statements. The unaudited condensed consolidated financial statements included in this Report do not include any adjustments that might result from the outcome of this uncertainty.
Previous wording
In November 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 wording
In November 2025, we incurred installation and field deployment costs associated with the initial deployment and pilot operation of our rain and snowfall enhancement 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.
Previous wording
For the three months ended March 31, 2026, we had a net loss of approximately $1.9 million, which consisted of field operations costs of approximately $93,000, general and administrative expenses of approximately $1.8 million (primarily related to personnel costs, stock based compensation expense, professional services, marketing, and other corporate operating expenses), research and development expenses of approximately $41,000, amortization expense of approximately $3,000, depreciation expense of approximately $10,000, and interest expenses of approximately $139,000, minimal interest income from an operating account, partially offset by a one-time service revenue with Utah Division of Water Resources of $10,500, and a gain due to the change in fair value of warrant liabilities of $205,000.
Current wording
For the three months ended June 30, 2026, we had a net loss of approximately $3.2 million, which consisted of field operations costs of approximately $105,000, general and administrative expenses of approximately $2.9 million (primarily related to personnel costs, stock based compensation expense, professional services, marketing, and other corporate operating expenses), research and development expenses of approximately $32,000, amortization expense of approximately $3,000, depreciation expense of approximately $10,000, and interest expenses of approximately $310,000, minimal interest income from an operating account, partially offset by a gain due to the change in fair value of warrant liabilities of $120,000.
Previous wording
For the three months ended March 31, 2026, net cash used in operating activities was approximately $1.9 million, net cash used in investing activities was approximately $9,500, and net cash provided by financing activities was approximately $2.3 million. Net cash used in operating activities included our net loss of approximately $1.9 million, a gain due to change in the fair value of a warrant liabilities of $205,000, and changes in operating assets and liabilities of approximately $519,000, partially offset by amortization expense of approximately $3,000, depreciation expense of approximately $10,000, approximately $439,000 paid by related parties on behalf of RET, and stock-based compensation expenses of approximately $258,000. Cash used in investing activities consisted solely of payment for building Equipment of approximately $9,500. Cash provided by financing activities resulted from proceeds from drawdowns under the LOC (as defined below) of approximately $2.3 million.
Current wording
For the six months ended June 30, 2026, net cash used in operating activities was approximately $2.9 million, net cash used in investing activities was approximately $9,500, and net cash provided by financing activities was approximately $2.7 million. Net cash used in operating activities included our net loss of approximately $5.1 million, a gain due to change in the fair value of a warrant liabilities of $325,000, partially offset by amortization expense of approximately $6,000, depreciation expense of approximately $20,000, approximately $617,000 paid by related parties on behalf of RET, and stock-based compensation expenses of approximately $1.7 million, and changes in operating assets and liabilities of approximately $194,000. Cash used in investing activities consisted solely of payment for building Equipment of approximately $9,500. Cash provided by financing activities resulted from proceeds from drawdowns under the LOC (as defined below) of approximately $2.8 million, partially offset by payment of deferred financing costs of approximately $23,000.
Previous wording
For the three months ended March 31, 2025, net cash used in operating activities was approximately $1.0 million, net cash used in investing account was approximately $139,000, and net cash provided by financing activities was approximately $1.4 million. Net loss of approximately $1.5 million was partially offset by changes in operating assets and liabilities of approximately $368,000 and non-cash activities, including amortization expense of approximately $3,000, minimal expenses paid by related parties on behalf of RET, and change in fair value of warrant liability of $90,000, resulted in approximately $1.0 million of cash used in operating activities. Cash used in investing activities consisted solely of payment for building Equipment of approximately $139,000. Cash provided by financing activities resulted from proceeds from payment of subscription receivable of $650,000 and proceeds from drawdown under the LOC of approximately $737,000.
Current wording
For the six months ended June 30, 2025, net cash used in operating activities was approximately $1.4 million, net cash used in investing activities was approximately $613,000, and net cash provided by financing activities was approximately $2.0 million. Net loss of approximately $2.4 million, and gain from settlement with vendor of approximately $226,000, partially offset by changes in operating assets and liabilities of approximately $39,000, amortization expense of approximately $6,000, approximately $1.1 million paid by related parties on behalf of RWT, and change in fair value of warrant liability of $162,500, resulted in approximately $1.4 million of net cash used in operating activities. Cash used in investing activities consisted solely of payment for building Equipment of approximately $613,000. Cash provided by financing activities resulted from proceeds from payment of subscription receivable of $650,000 and proceeds from drawdowns under the LOC of approximately $1.3 million.
Previous wording
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. In November 2025, we paid an aggregate of $50,000 in milestone payments to Mr. Morris in connection with the achievement of certain development milestones.
Current wording
We entered into a consulting agreement to engage our senior technology advisor who provides strategic technology leadership and advisory services to us, 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 July and effective as of June 1, 2025, the annual consulting fee was further increased to $252,000 in exchange for the consultant assuming an additional role and responsibilities. The agreement also provided 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. In November 2025, we paid an aggregate of $50,000 in milestone payments to Mr. Morris in connection with the achievement of certain development milestones.
Previous wording
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 March 31, 2026 and December 31, 2025, we accrued approximately $1.3 million and $831,000 of Retention Bonus, respectively. In addition, we also accrued $1 million of annual incentive bonus for 2025 in accrued expenses to related party in the accompanying consolidated balance sheet as of December 31, 2025. We paid the $1 million annual incentive bonus for 2025 to Mr. Seidl in March 2026, pursuant to the Board’s determination and approval.
Current wording
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 June 30, 2026 and December 31, 2025, we accrued approximately $1.7 million and $831,000 of Retention Bonus, respectively. In addition, we also accrued $1 million of annual incentive bonus for 2025 in accrued expenses to related party in the accompanying consolidated balance sheet as of December 31, 2025. We paid the $1 million annual incentive bonus for 2025 to Mr. Seidl in March 2026, pursuant to the Board’s determination and approval.
Previous 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 March 31, 2026 and December 31, 2025, we had an aggregate of approximately $28,000 and $48,000 remaining outstanding in connection with such agreement that was included in accrued expenses in the accompanying consolidated balance sheets, respectively. 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 March 31, 2026, the stock has not been granted.
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 June 30, 2026 and December 31, 2025, we had an aggregate of approximately $7,000 and $48,000 remaining outstanding in connection with such agreement that was included in accrued expenses in the accompanying consolidated balance sheets, respectively.
Previous 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 $75,000 and $0 in connection with such agreements during the three months ended March 31, 2026 and 2025 within general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations, respectively. As of March 31, 2026, there has been no grants of restricted stock to the directors.
Current wording
In connection with their appointments to the Board, Mr. Reardon, Mr. Peperzak and Mr. Sylvester each entered into 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 non-employee directors (the “Director Agreements”). 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 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) 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 expenses of $75,000 and $150,000 related to these agreements during the three and six months ended June 30, 2026, respectively, and $100,000 during both the three and six months ended June 30, 2025, which were included in general and administrative expenses in the accompanying unaudited condensed consolidated statements of operations. See Recent Developments for additional information regarding equity awards granted to members of the Board.
Previous wording
While our significant accounting policies are described in the notes to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report, our management believes there were no critical accounting estimates identified during the three months ended March 31, 2026 and 2025.
Current wording
While our significant accounting policies are described in the notes to our unaudited condensed consolidated financial statements included elsewhere in this Report, our management believes there were no critical accounting estimates identified during the three and six months ended June 30, 2026 and 2025.
Previous wording
We capitalize our cost to build our rainfall ionization equipment (the “Equipment”), including materials and allocated labor costs directly attributable to the construction of the Equipment. Costs incurred prior to completion of the equipment are recorded as construction in progress. Upon the installation of the Equipment, we transferred our capitalized cost from Construction in-process to Equipment. Equipment that has been completed but has not yet been installed or otherwise placed into service remains within Construction in-process Equipment and is not depreciated until transferred into Equipment and placed into service.
Current wording
We capitalize our cost to build our rainfall ionization equipment (the “Equipment”), including materials and allocated labor costs directly attributable to the construction of the Equipment. Costs incurred prior to completion of the equipment are recorded as construction in progress. Upon the installation of the Equipment, we transferred our capitalized cost from Construction in-process Equipment to Equipment. Equipment that has been completed but has not yet been installed or otherwise placed into service remains within Construction in-process Equipment and is not depreciated until transferred into Equipment and placed into service.
Previous wording
As of December 31, 2024, no Equipment has been placed in service. In November 2025, two systems were placed into service and was moved from Construction in-process into Equipment. During the three months ended March 31, 2026, we recorded approximately $10,000 of depreciation expense related to those 2 units in the accompanying unaudited condensed consolidated statements of operations. The remaining units were not placed in service and remained included in the Construction in-process as of March 31, 2026 and December 31, 2025 in the accompanying unaudited condensed consolidated balance sheets.
Current wording
As of December 31, 2024, no Equipment was placed in service. In November 2025, two systems were placed into service and was moved from Construction in-process Equipment into Equipment. During the three and six months ended June 30, 2026, we recorded approximately $10,000 and $20,000 of depreciation expense related to those two units in the accompanying unaudited condensed consolidated statements of operations, respectively. The remaining 10 units were not placed in service and remained included in the Construction in-process Equipment as of June 30, 2026 and December 31, 2025 in the accompanying unaudited condensed consolidated balance sheets.
Previous wording
We evaluate long-lived assets, including intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. No impairment was recorded for the three months ended March 31, 2026 or 2025.
Current wording
We evaluate long-lived assets, including intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. No impairment was recorded for the three and six months ended June 30, 2026 or 2025.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the six months ended June 30, 2026, we had a net loss of approximately $5.1 million, which consisted of field operations costs of approximately $197,000, general and administrative expenses of approximately $4.7 million (primarily related to personnel costs, stock based compensation expense, professional services, marketing, and other corporate operating expenses), research and development expenses of approximately $73,000, amortization expense of approximately $6,000, depreciation expense of approximately $20,000, and interest expenses of approximately $450,000, minimal interest income from an operating account, partially offset by other revenue of $10,500, and a gain due to the change in fair value of warrant liabilities of $325,000.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
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 us from any potential future capital raise net of any underwriting, legal, and accounting fees and related costs.