SYNTEC OPTICS HOLDINGS, INC.

Note 1 —Description of Organization and Business Operations

Nature of Business

Syntec Optics Holdings, Inc. (the “Company” or “Syntec Optics”) is a vertically integrated manufacturer of optics and photonics components and sub-systems – from opto-mechanicals to optical elements of various geometries, diamond turned optics – both prototype and production, and optical systems including optics assembly, electro-optics assembly, design, and coating. Sales are made to customers in the United States and Europe in defense, medical, and consumer end-markets. The Company hasone reporting segment as its operating segments meet the requirements for aggregation.

Note 2 —Summary of Significant Accounting Policies

The Company has provided a discussion of significant accounting policies, estimates and judgements in its 2025 Annual Report. There have been no changes to the Company’s significant accounting policies since December 31, 2025.

Basis of Presentation

The accompanying interim unaudited condensed consolidated financial statements have been prepared by the Company in United States (“U.S.”) dollars and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”), the instructions to Form 10-Q and the provisions of Regulation S-X pertaining to interim unaudited condensed financial statements. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S. have been condensed or omitted. The interim unaudited condensed consolidated financial statements and notes included in this report should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. In the opinion of management, these interim unaudited condensed consolidated financial statements include all adjustments and accruals of a normal and recurring nature necessary to fairly state the results of the interim periods presented. The results for interim periods are not necessarily indicative of results to be expected for the full year or for any future periods.

Recent Accounting Pronouncements

In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments in this ASU provide that in developing reasonable and supportable forecasts as part of estimating expected credit losses for current accounts receivable and current contract assets, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. The amendments in this ASU are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with updates to be applied on a prospective basis. The Company adopted ASU 2025-05 as of January 1, 2026. The adoption of ASU 2025-05 did not have a material impact on the Company’s financial statements.

Note 3 —Disaggregated Revenues

The following table disaggregates revenue by revenue stream for the three and six months ended June 30:

Syntec Optics’ management periodically reviews its revenues by its consumer, communication, medical, and defense end-markets. The purpose of this analysis is to determine its end market mix and identify trends. The following table disaggregates revenue as outlined above for the three and six months ended June 30:

Note 4 —Inventory

Inventory consists of the following at June 30, 2026 and December 31, 2025:

Note 5 —Property and Equipment

Property and equipment consists of the following at June 30, 2026 and December 31, 2025:

Depreciation expenses were $532,500 and $676,600 for the three months ended June 30, 2026 and 2025, respectively, and $1,072,164 and $1,387,427 for the six months ended June 30, 2026 and 2025, respectively.

Note 6 —Line of Credit

On May 5, 2026, the Company made a $2.0 million payment on the line of credit with M&T Bank (the “Credit Agreement”), reducing the balance to $4.8 million.

On May 13, 2026, the Company made a payment of approximately $4.8 million on the line of credit, reducing the balance tozero.

On June 10, 2026, the Company voluntarily cancelled its line of credit. By doing so, the Company is no longer subject to maintaining the minimum Fixed Charge Coverage Ratio and maximum Total Leverage Ratio financial covenants which were part of the Credit Agreement. Further, the Company no longer has to pay a usage fee for the unused portion of the line of credit.

Note 7 —Long-Term Debt

Long-term debt consists of the following at June 30, 2026 and December 31, 2025:

At June 30, 2026, the future debt maturities are as follows:

Note 8 —Retirement Plan

The Company maintains a 401(k) retirement plan covering eligible employees of the Company and its affiliates. Under the plan, participants may defer up to 100% of their annual compensation, subject to legal limitations. Syntec Optics matches 50% of employee contributions, up to the first 6% of annual compensation deferred (for a maximum company contribution of 3% of annual compensation).

Total contributions for the Company for the three months ended June 30, 2026 and 2025 amounted to $52,000 and $45,000, respectively, and for the six months ended June 30, 2026 and 2025, Company contributions were $94,000 and $93,000, respectively.

Note 9 —Income Taxes

The income tax provision for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, the estimate of the annual effective tax rate is updated, and if the estimated effective tax rate changes, a cumulative adjustment is made.

The effective income tax rate was 32.5% and 20.3% for the six months ended June 30, 2026 and 2025, respectively.

Note 10 —Leases

During 2024, the Company entered into finance lease agreements for equipment utilized in its manufacturing facility.

The components of operating and finance lease costs are as follows for the three and six months ended June 30 :

Supplemental cash flow information related to leases are as follows for the three and six months ended June 30:

The following table summarizes weighted average remaining lease term and discount rates as of June 30, 2026, and December 31, 2025:

Future maturities of our lease liabilities are as follows as of June 30, 2026:

Note 11 —Stockholders’ Equity

On April 30, 2026, the Company completed an underwritten public offering of 2,857,142 shares of its common stock at a public offering price of $7.00 per share. The gross proceeds from the offering were approximately $20.0 million, before deducting underwriting discounts, commissions and other offering expenses. Net proceeds to the Company were approximately $18.6 million.

The offering was conducted pursuant to the Company’s Registration Statement on Form S-1 (File No. 333-295335), which was declared effective by the Securities and Exchange Commission on April 28, 2026.

The Company granted the underwriter a 30-day option to purchase up to an additional 428,571 shares of common stock at the public offering price, less underwriting discounts and commissions.

On May 1, 2026, the underwriter in the aforementioned April 30 transaction chose to exercise its option to purchase an additional 428,571 shares of common stock. Net proceeds to the Company were approximately $2.8 million.

Note 12 —Warrants

The following tables presents a roll-forward of the Company’s equity classified warrants from December 31, 2025 to June 30, 2026:

Note 13 — Income(Loss) Per Share

The following table sets forth the information needed to compute basic and diluted income (loss) per share for the three and six months ended June 30, 2026 and 2025:

Note 14 —Significant Customers

For the three and six months ended June 30, 2026, the Company generated 52% of revenues from three customers. These three customers are in different end-markets utilizing diverse manufacturing capabilities from the Company. The outstanding accounts receivable due from these customers were approximately $3.3 million as of June 30, 2026.

For the three and six months ended June 30, 2025, the Company generated 43% and 41%, of revenues, respectively, from three customers. The outstanding accounts receivable due from these customers were approximately $2.8 million as of June 30, 2025.

Note 15 —Segment reporting

The Company operates asone operating segment. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer, who reviews the financial statements on a consolidated basis. The CODM uses the Company’s long-range plan to allocate resources. The CODM makes decisions on resource allocation, assessments of performance, and monitors budget versus actual results using consolidated loss from operations.

Significant expenses within loss from operations, as well as within net loss, include general and administrative expenses, and other expenses which are each separately presented on the Company’s Consolidated Statements of Operations and Comprehensive Loss.

Note 16 —Subsequent Events

On July 23, the Company filed an S-1 registration statement. On July 29, the Company filed the related prospectus under Rule 424(b)(3), which became effective July 29.

This prospectus relates to the resale from time to time by the selling stockholders identified within the prospectus of up to 30,706,090 shares of class A common stock, par value $0.0001 per share (the “common stock” or “common shares”) of Syntec Optics Holdings, Inc. (the “Company,” “Syntec,” “we,” “our,” or “us”).

The shares of common stock covered by this prospectus are currently issued and outstanding shares of our common stock. We are not issuing any new shares under this registration statement and will not receive any proceeds from the sale of shares by the selling stockholders.

The shares of common stock are being registered for resale pursuant to that certain Amended and Restated Registration Rights Agreement, dated as of October 31, 2023, by and among OmniLit Sponsor LLC, a Delaware limited liability company, OmniLit’s officers, directors, initial stockholders, certain non-redemption agreement investors and certain Legacy Syntec (as defined herein) stockholders (the “Registration Rights Agreement”), which we entered into in connection with the Company’s business combination consummated in October 2023. The selling stockholders consist of our Chairman and Chief Executive Officer and certain members of our Board of Directors.