EON Resources Inc.

Previous wording

References in this report (the “Quarterly Report”) to “we,” “us” or the “Company” refer to EON Resources, Inc. (formerly HNR Acquisition Corp.). References to our “management” or our “management team” refer to our officers and directors, and references to the “Sponsor” refer to HNRAC Sponsors, LLC. References to the Predecessor refer to the business of Pogo Resources, LLC and its subsidiaries prior to the Closing Date. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited consolidated financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Current wording

References in this report (the“Quarterly Report”) to“we,”* “us” or the*“Company”* refer to EON Resources, Inc.. References to our*“management”* or our*“management team”* refer to our officers and directors, and references to the*“Sponsor”* refer to HNRAC Sponsors, LLC. References to the Predecessor refer to the business of Pogo Resources, LLC and its subsidiaries prior to the Closing Date. The following discussion and analysis of the Company*’s financial condition and results of operations should be read in conjunction with the unaudited consolidated financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Previous wording

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the SEC. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Current wording

This Quarterly Report includes“forward-looking statements”* within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this*“Management’s Discussion and Analysis of Financial Condition and Results of Operations”* regarding the Company*’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as“expect,”* “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management*’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the SEC. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Previous wording

We are an independent oil and natural gas company based in Texas and formed in 2017 that is focused on the acquisition, development, exploration, production and divestiture of oil and natural gas properties in the Permian Basin. The Permian Basin is located in west Texas and southeastern New Mexico and is characterized by high oil and liquids-rich natural gas content, multiple vertical and horizontal target horizons, extensive production histories, long-lived reserves and historically high drilling success rates. Our properties are in the Grayburg-Jackson Field in Eddy County, New Mexico, and South Justis Field in Lea County, New Mexico which are both in the sub-area of the Permian Basin. LHO focuses primarily on production through waterflooding recovery methods.

Current wording

We are an independent oil and natural gas company based in Texas and formed in 2017 that is focused on the acquisition, development, exploration, production and divestiture of oil and natural gas properties in the Permian Basin. The Permian Basin is located in west Texas and southeastern New Mexico and is characterized by high oil and liquids-rich natural gas content, multiple vertical and horizontal target horizons, extensive production histories, long-lived reserves and historically high drilling success rates. Our properties are in the Grayburg-Jackson Field (the “GJF”) in Eddy County, New Mexico, and South Justis Field (the “SJF”) in Lea County, New Mexico which are both in the sub-area of the Permian Basin. LHO Operating, LLC, a subsidiary of the Company (“LHO”), focuses primarily on production through waterflooding recovery methods.

Previous wording

Our assets as mentioned above consist of contiguous leasehold positions in the Grayburg-Jackson Field of approximately 13,700 gross (13,700 net) acres with an average working interest of 100%. We operate 100% of the net acreage across the Grayburg-Jackson Field assets, all of which is net operated acreage of vertical wells with average depths of approximately 3,810 feet. In addition, our South Justis Field has contiguous leasehold positions of approximately 5,400 gross (5,400) acres with an average working interest of 94%. We operate 100% of the net acreage across the South Justis field assets, all of which is net operated acreage of vertical wells with average depths of approximately 6,000 feet.

Current wording

Our assets as mentioned above consist of contiguous leasehold positions in the GJF of approximately 13,700 gross (13,700 net) acres with an average working interest of 100%. We operate 100% of the net acreage across the GJF assets, all of which is net operated acreage of vertical wells with average depths of approximately 3,810 feet. In addition, the SJF has contiguous leasehold positions of approximately 5,400 gross (5,400) acres with an average working interest of 94%. We operate 100% of the net acreage across the SJF assets, all of which is net operated acreage of vertical wells with average depths of approximately 6,000 feet.

Previous wording

Our average daily production for the nine months ended September 30, 2025 was 749 barrel of oil equivalent (“BOE”) per day. Our average daily production for the year ended December 31, 2024, was 798 BOE per day. The decrease in production is due to an increase in well downtime, water injection flowlines that needed repair or replacement, and the conveyance of the 10% Override royalty interest to Pogo Royalty.

Current wording

Our average daily production for the three months ended March 31, 2026 was 759 barrels of oil equivalent (“BOE”) per day. Our average daily production for the year ended December 31, 2025, was 734 BOE per day. The increase in production is due to an increase in operating wells from new well completions and well repairs.

Previous wording

The price at which our oil and natural gas production are sold typically reflects either a premium or discount to the New York Mercantile Exchange (“NYMEX”) benchmark price. Thus, our operating results are also affected by changes in the oil price differentials between the applicable benchmark and the sales prices we receive for our oil production. Our oil price differential to the NYMEX benchmark price during the nine months ended September 30, 2025 and 2024, was $(1.52) and $(2.07) per barrel, respectively. Our natural gas price differential during the nine months ended September 30, 2025 and 2024, was $(0.36) and $0.03 per one thousand cubic feet (“Mcf”), respectively. Fluctuations in our price differentials and realizations are due to several factors such as gathering and transportation costs, takeaway capacity relative to production levels, regional storage capacity, gain/loss on derivative contracts and seasonal refinery maintenance temporarily depressing demand.

Current wording

In addition to the factors that affect companies in our industry generally, the location of substantially all of our acreage discussed above subjects our operating results to factors specific to these regions. These factors include the potential adverse impact of weather on drilling, production and transportation activities, particularly during the winter and spring months, as well as infrastructure limitations, transportation capacity, regulatory matters and other factors that may specifically affect one or more of these regions. The price at which our oil and natural gas production are sold typically reflects either a premium or discount to the New York Mercantile Exchange (“NYMEX”) benchmark price. Thus, our operating results are also affected by changes in the oil price differentials between the applicable benchmark and the sales prices we receive for our oil production. Our oil price differential to the NYMEX benchmark price during the three months ended March 31, 2026 and 2025, was $(1.65) and $(1.78) per barrel, respectively. Our natural gas price differential during the three months ended March 31, 2026 and 2025, was $(2.54) and $(2.10) per one thousand cubic feet (“Mcf”), respectively. Fluctuations in our price differentials and realizations are due to several factors such as gathering and transportation costs, takeaway capacity relative to production levels, regional storage capacity, gain/loss on derivative contracts and seasonal refinery maintenance temporarily depressing demand.

Previous wording

Prices for various quantities of natural gas and oil that we produce significantly impact our revenues and cash flows. The following table lists average NYMEX prices for oil and natural gas for the three and nine months ended September 30, 2025 and 2024.

Current wording

Prices for various quantities of natural gas and oil that we produce significantly impact our revenues and cash flows. The following table lists average NYMEX prices for oil and natural gas for the three months ended March 31, 2026 and 2025.

Previous wording

For the nine months ended September 30, 2025, the average NYMEX oil pricing was $67.40 per barrel of oil or 14% lower than the average NYMEX price per barrel for the nine months ended September 30, 2024. Our settled derivatives increased our realized oil price per barrel by $3.58 in the nine months ended September 30, 2025, and decreased our realized oil price per barrel by $2.56 in the nine months ended September 30, 2024. Our average realized oil price per barrel after reflecting settled derivatives and location differentials was $69.46 and $73.87 for the nine months ended September 30, 2025 and 2024, respectively.

Current wording

For the three months ended March 31, 2026, the average NYMEX oil pricing was $71.98 per barrel of oil or 0.2% higher than the average NYMEX price per barrel for the three months ended March 31, 2025. Our settled derivatives decreased our realized oil price per barrel by $4.91 and $2.28 in the three months ended March 31, 2026, and 2025, respectively. Our average realized oil price per barrel after reflecting settled derivatives and location differentials was $65.42 and $67.78 for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

The average NYMEX natural gas pricing for the nine months ended September 30, 2025, was $3.45 per Mcf, or 64% higher than the average NYMEX price of $2.11 per Mcf for the nine months ended September 30, 2024.

Current wording

The average NYMEX natural gas pricing for the three months ended March 31, 2026, was $4.79 per Mcf, or 3% lower than the average NYMEX price of $4.94 per Mcf for the three months ended March 31, 2025.

Previous wording

Our revenues vary from year to year primarily as a result of changes in realized commodity prices and production volumes. For the nine months ended September 30, 2025, our oil and natural gas sales decreased 19% from the nine months ended September 30, 2024, excluding the effect of settled commodity derivatives, and a 11% decrease in production volumes. Production volumes decreased for the nine months ended September 30, 2025 from the nine months ended September 30, 2024 as a result of increased flaring of natural gas during the current period.

Current wording

Our revenues vary from year to year primarily as a result of changes in realized commodity prices and production volumes. Excluding the effect of settled commodity derivatives, our oil and natural gas sales for the three months ended March 31, 2026 were flat compared to the three months ended March 31, 2025, despite a 1% increase in production volumes. Production volumes increased for the three months ended March 31, 2026 from the three months ended March 31, 2025 as a result of increased operating wells from the Company’s South Justis Field acquired in late June of 2025.

Previous wording

We enter into commodity derivatives instruments to manage the price risk attributable to future oil production. We recorded a loss on derivative contracts of $224,512 for the three months ended September 30, 2025, compared to a gain of $ 1,900,662 for the three months ended September 30, 2024. Lower commodity prices in the three months ended September 30, 2025, resulted in realized gains of $429,241 compared to realized losses of $ 107,969 for the three months ended September 30, 2024. For the three months ended September 30, 2025, unrealized losses were $653,753 compared to unrealized gains of $ 2,008,631 for the three months ended September 30, 2024.

Current wording

We enter into commodity derivatives instruments to manage the price risk attributable to future oil production. We recorded a loss on derivative contracts of $3,579,475 for the three months ended March 31, 2026, compared to a loss of $85,071 for the three months ended March 31, 2025. Higher commodity prices in the three months ended March 31, 2026, resulted in realized losses of $306,024 compared to realized losses of $142,859 for the three months ended March 31, 2025. For the three months ended March 31, 2026, unrealized losses were $3,273,451 compared to an unrealized gain of $57,788 for the three months ended March 31, 2025.

Previous wording

For the three months ended September 30, 2025, our average realized oil price per barrel after reflecting settled derivatives was $70.15 compared to $77.12 for the three months ended September 30, 2024. For the three months ended September 30, 2025, our settled derivatives increased our realized oil price per barrel by $6.30 compared to decreasing the price per barrel by $1.61 for the three months ended September 30, 2024. As of September 30, 2025, we ended the period with a $20,561 net derivative asset compared to a net asset of $106,397 as of December 31, 2024.

Current wording

For the three months ended March 31, 2026, our average realized oil price per barrel of oil equivalent after reflecting settled derivatives was $60.89 compared to $64.23 for the three months ended March 31, 2025. For the three months ended March 31, 2026, our settled derivatives decreased our realized oil price per barrel by $4.48 compared to decreasing the price per barrel by $2.12 for the three months ended March 31, 2025. As of March 31, 2026, we ended the period with a $3,210,117 net derivative liability compared to a net asset of $63,334 as of December 31, 2025.

Previous wording

Other revenue was $104,587 for the three months ended September 30, 2025, compared to $98,452 for the three months ended September 30, 2024. The revenue is related to providing water services to a third party. The contract is for one year starting on September 1, 2022, and has been renewed by mutual agreement.

Current wording

Other revenue was $83,110 for the three months ended March 31, 2026, compared to $117,532 for the three months ended March 31, 2025. The revenue is related to providing water services to a third party.

Previous wording

Lease operating expenses were $2,545,969 for the three months ended September 30, 2025, compared to $ 2,136,732 for the three months ended September 30, 2024. On a per unit basis, production expenses increased 19% from $27.87 per BOE for the three months ended September 30, 2024, to $33.08 per BOE for the three months ended September 30, 2025.

Current wording

Lease operating expenses were $2,528,313 for the three months ended March 31, 2026, compared to $2,190,767 for the three months ended March 31, 2025. On a per unit basis, production expenses increased 14.0% from $32.50 per BOE for the three months ended March 31, 2025, to $37.02 per BOE for the three months ended March 31, 2026. The increase in lease operating expenses in the current period was primarily a result of the additional cost related to the South Justis Field.

Previous wording

We pay production taxes, transportation and processing costs based on realized oil and natural gas sales. Production taxes, transportation and processing costs were $435,539 for the three months ended September 30, 2025, compared to $489,524 for the three months ended September 30, 2024. As a percentage of oil and natural gas sales, these costs were 9.7% and 9% in the three months ended September 30, 2025 and 2024 respectively. Production taxes, transportation, and processing as a percent of total oil and natural gas sales are consistent with historical trends.

Current wording

We pay production taxes, transportation and processing costs based on realized oil and natural gas sales. Production taxes, transportation and processing costs were $414,004 for the three months ended March 31, 2026, compared to $397,216 for the three months ended March 31, 2025. As a percentage of oil and natural gas sales, these costs were 9% in the three months ended March 31, 2026 and 2025. Production taxes, transportation, and processing as a percent of total oil and natural gas sales are consistent with historical trends.

Previous wording

Depletion, depreciation and amortization (“DD&A”) was $526,871 for the three months ended September 30, 2025 compared to $507,626 for the three months ended September 30, 2024. DD&A was $6.84 per BOE for the three months ended September 30, 2025, compared to $6.62 per BOE for the three months ended September 30, 2024. The aggregate increase in DD&A expense for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, was driven by the increase in the cost basis offset by a decrease in oil and gas production.

Current wording

Depletion, depreciation and amortization (“DD&A”) was $1,790,976 for the three months ended March 31, 2026 compared to $97,075 for the three months ended March 31, 2025. DD&A was $26.22 per BOE for the three months ended March 31, 2026, compared to $1.44 per BOE for the three months ended March 31, 2025. The increase in the DD&A rate per BOE was driven by the increase in the oil and gas properties balance due to the development of the Seven Rivers waterflood interval and the decrease in the reserves balance due to the net conveyance of the addition 5% overriding royalty interest to Virtus, along with a change in reserve classification from proved to probable in 2025.

Previous wording

Accretion expense was $29,388 for the three months ended September 30, 2025, compared to $10,395 for the three months ended September 30, 2024. Accretion expense was $0.38 per BOE for the three months ended September 30, 2025, compared to $0.14 per BOE for the three months ended September 30, 2024. The aggregate increase in accretion expense for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, was driven by the addition of the South Justice field.

Current wording

Accretion expense was $31,675 for the three months ended March 31, 2026, compared to $6,992 for the three months ended March 31, 2025. Accretion expense was $0.46 per BOE for the three months ended March 31, 2026, compared to $0.10 per BOE for the three months ended March 31, 2025. The aggregate increase in accretion expense for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was driven by changes in certain assumptions.

Previous wording

General and administrative expenses were $2,591,296 for the three months ended September 30, 2025, compared to $2,235,263 for the three months ended September 30, 2024. The increase in general and administrative expenses is primarily due to increase legal and professional fees associated with the transactions closed during the current period, partially offset by decreased stock-based compensation in the current period of $419,669 compared to $326,995 in the comparative period.

Current wording

General and administrative expenses were $2,406,571 for the three months ended March 31, 2026, compared to $1,808,890 for the three months ended March 31, 2025. The increase in general and administrative expenses is primarily due to increased professional fees during the current period, partially offset by decreased stock-based compensation in the current period of $271,941 compared to $368,093 in the comparative period.

Previous wording

Interest expense was $1,220,390 for the three months ended September 30, 2025, compared to $1,841,848 for the three months ended September 30, 2024. The decrease in interest expense is driven by the decreases in the Private Notes Payable and the Senior Secured Term Loan, along with the eventual settlement of the Senior Term Loan.

Current wording

Interest expense was $260,381 for the three months ended March 31, 2026, compared to $1,744,246 for the three months ended March 31, 2025. The decrease in interest expense is driven by the decreases in the Private Notes Payable and the Senior Secured Term Loan, along with the eventual settlement of the Senior Term Loan.

Previous wording

During the three months ended September 30, 2025, the Company recorded $399,697 related to the amortization of financing costs compared to $507,701 for the three months ended September 30, 2024. These costs are attributable to deferred finance costs paid on the Senior Secured Term Loan, and discounts associated with the Private Notes Payable during 2023.

Current wording

During the three months ended March 31, 2026, the Company recorded $486,268 related to the amortization of financing costs compared to $337,370 for the three months ended March 31, 2025. These costs are attributable to debt discount associated with the Company’s recent convertible notes payable.

Previous wording

Change in fair value of warrant and convertible note liabilities

Current wording

Change in fair value of derivative liabilities and convertible note liabilities

Previous wording

The change in fair value of warrant liabilities consisted of a loss of $137,911 for the three months ended September 30, 2024, related to fluctuations in the trading price of our warrants, a portion of which were accounted for as liabilities due to the redemption provisions in those issued to Private Note holders. All warrants previously accounted for as liabilities were exchanged into convertible notes during the nine months ended September 30, 2025.

Current wording

The change in fair value of warrant liabilities consisted of a loss of $162,520 for the three months ended March 31, 2025, related to fluctuations in the trading price of our warrants, a portion of which are accounted for as liabilities due to the redemption provisions in those issued to Private Note holders. All such warrants were settled during the year ended December 31, 2025.

Previous wording

The change in fair value of convertible note liabilities consisted of a loss of $131,677 for the nine months ended September 30, 2025.

Current wording

The change in fair value of convertible note liabilities consisted of a loss of $129,746 for the three months ended March 31, 2025 related to a prior convertible note accounted for at fair value.

Previous wording

The Company recognized a gain on extinguishment of liabilities of $2,146,285 during the nine months ended September 30, 2025, primarily related to the settlement of the Senior Term Loan, the exchange of certain notes payable and warrant liabilities for convertible note agreements, other liabilities associated with the Company’s prior acquisition.

Current wording

The Company recognized a loss on extinguishment of liabilities of $391,819 during the three months ended March 31, 2025 related to the exchange of certain notes payable and warrant liabilities for convertible note agreements.

Previous wording

As of September 30, 2025, we had outstanding debt of $4,425,000 of convertible notes payable and $1,248,062 from merchant cash advances. A total of $1,248,062 of this is due within one year. As of September 30, 2025, we had $875,604 of cash and cash equivalents on hand and had a working capital deficit of $9,940,605. These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date that the financial statements are issued.

Current wording

As of March 31, 2026, we had outstanding debt of $3,746,454 in private notes payable with related parties, $3,050,000 of convertible notes payable and $1,380,679 from merchant cash advances. A total of $1,980,679 of this is due within one year. As of March 31, 2026, we had $129,772 of cash and cash equivalents on hand, and a working capital deficit of $22,600,412.

Previous wording

We had negative cash flow from operations of $9,520,380 for the nine months ended September 30, 2025 and positive cash flow from operations of $3,700,686 for the year ended December 31, 2024. Additionally, management’s plans to alleviate this substantial doubt include improving profitability through streamlining costs, maintaining active hedge positions for its proven reserve production, and the issuance of additional shares of Class A Common Stock. We have a three-year Common Stock Purchase Agreement with a maximum funding limit of $150,000,000 that can fund our operations and production growth, and be used to reduce liabilities. Through the date of this filing, we have received $11,045,626 in cash proceeds related to the sale of 16,800,000 shares of common stock under this agreement and expect to continue to utilize it to fund operational needs. We cannot assure you, however, that any additional capital will be available to us on favorable terms or at all. Our capital expenditures could be curtailed if our cash flows decline from expected levels.

Current wording

We have a three-year equity line Common Stock Purchase Agreement with a maximum funding limit of $150,000,000 that can fund our operations and production growth, and can be used to reduce liabilities. Through the date of this filing, we have received $11,130,586 in cash proceeds related to the sale of 17,000,000 shares of common stock under the Common Stock Purchase Agreement and expect to continue to utilize it to fund current operational needs. We cannot assure you, however, that any additional capital will be available to us on favorable terms or at all. Our capital expenditures could be curtailed if our cash flows decline from expected levels. Until we have an effective registration statement on file with the Securities and Exchange commission, we are unable to utilize the Common Stock Purchase Agreement. These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date that the financial statements are issued.

Previous wording

Sources and uses of cash for the nine months ended September, 2025 and 2024, are as follows:

Current wording

Sources and uses of cash for the three months ended March 31, 2026 and 2025 are as follows:

Previous wording

The change in net cash flow used operating activities for the nine months ended September 30, 2025, as compared to 2024 is primarily due to decreased production volumes and a reduction in payable balances during the current period.

Current wording

The change in net cash flow used operating activities for the three months ended March 31, 2026, as compared to 2025 is primarily due to higher realized market prices for crude oil, offset by decreases in production volumes and higher operating expenses.

Previous wording

Net cash used in investing activities for the nine months ended September 30, 2025 was primarily related to cash proceeds from the sale of the of the 2025 ORRI’s and Farmout Agreement for aggregate proceeds of $45,500,000, partially offset by the repurchase of the Pogo ORRI for $13,500,000 in cash and $3,612,074 in development costs for our reserves. Cash flows used in investing activities for the nine months ended September 30, 2024 consisted primarily of $3,275,667 of cash paid for development costs of our reserves.

Current wording

Net cash used in investing activities for the three months ended March 31, 2026 and 2025 was exclusively related to $1,088,790 and $1,117,540, respectively in development costs for our reserves.

Previous wording

Net cash provided by financing activities during the nine months ended September 30, 2025 were primarily related to the sale of common stock under the Common Stock Purchase Agreement of $8,117,772 and proceeds of $1,676,300 from short term notes payable offset by repayments of the Senior Secured Term Loan of $22,215,898, repayment of the seller note of $7,000,000 and Private Notes Payable of $2,102,794. Cash flows used in financing activities for nine months ended September 30, 2024 were primarily related to repayments of the Senior Secured Term Loan of $2,945,312 and Private Notes Payable of $43,750, partially offset by $1,184,272 in cash proceeds from sales of common stock under the Common Stock Purchase Agreement, $967,500 in cash proceeds from merchant cash advances, and an additional $450,000 in cash proceeds from the Private Notes Payable issued during the nine months ended September 30, 2024.

Current wording

Net cash provided by financing activities during the three months ended March 31, 2026 were primarily related to the issuance of new convertible notes payable resulting in proceeds of $1,692,000, $100,000 in proceeds from related party notes payable, partially offset by repayments of merchant cash advances of $642,498. Cash flows used in financing activities for the three months ended March 31, 2025 were primarily related to the sale of common stock under the Common Stock Purchase agreement of $4,341,532 and proceeds of $617,500 from short term notes payable offset by repayments of the Senior Secured Term Loan of $1,133,324 and Private Notes Payable of $778,277.

Previous wording

We have contractual commitments under our Private Notes Payable which include periodic interest payments. See Note 5 to our interim condensed consolidated unaudited financial statements. We have contractual commitments that may require us to make payments upon future settlement of our commodity derivative contracts. See Note 4 to our interim condensed consolidated unaudited financial statements.

Current wording

We have contractual commitments under our Convertible Notes Private Notes Payable and Merchant Cash Advances which include periodic interest payments. See Note 5 to our interim condensed consolidated unaudited financial statements. We have contractual commitments that may require us to make payments upon future settlement of our commodity derivative contracts. See Note 4 to our interim condensed consolidated unaudited financial statements.