LB 10-K & 10-Q changes, risk factors and insider trading

The SUAs we enter into and the sand, brackish water and other resources that we or our customers sell are substantially dependent on drilling, completion and production activities by E&P companies on or around our acreage. Similarly, the services WaterBridge and Desert Environmental provideprovides, from which we earn royalties and feesfees, are substantially dependent on thosethese same activities. If E&P companies do not maintain such activities on or around our land, their demand for the use of our land and resources and WaterBridge’s and Desert Environmental’s services will decline, negatively impacting our results of operations, cash flows and financial position.

Demand for the use of our land and resources, as well as the services provided by WaterBridge and Desert Environmental,WaterBridge, depends substantially on capital spending by producers to construct and maintain infrastructure on and around our acreage and explore for, develop and produce oil and natural gas in the area. These expenditures are generally dependent on such producers’ overall financial position, capital allocation priorities and ability to access capital, and their views of future demand for, and prices of, oil and natural gas. Volatility in oil or natural gas prices (or the perception that oil or natural gas prices will decrease) affects such producers’ capital expenditures and willingness to pursue development activities. This, in turn, could lead to lower demand for the use of our land and resources or WaterBridge’s and Desert Environmental’s services, delays in payment of, or nonpayment of, amounts that are owed to us and cause lower rates and lower utilization of our land. In addition, we own oil and gas royalty interests that generate revenue based on oil and natural gas prices and production. As a result, a significant decrease in the price of oil and natural gas or decrease in levels of production of oil and natural gas on and around our land could adversely affect our results of operations, cash flows and financial position. For additional information, please see “—The willingness of E&P companies to engage in drilling, completion and production activities on and around our land is substantially influenced by the market prices of oil and natural gas, which are highly volatile. A substantial or extended decline in oil and natural gas prices may adversely affect our results of operations, cash flows and financial position.”

Market prices for oil and natural gas are volatile and a decrease in prices could reduce drilling, completion and production activities by producers on or around our land, resulting in a reduction in the use of our land and resources and WaterBridge’s and Desert Environmental’s services, as well as the amount of revenues we receive from the production of oil and natural gas. The market prices for oil and natural gas are subject to U.S. and global macroeconomic and geopolitical conditions, among other things, and, historically, have been subject to significant price fluctuations and may continue to change in the future. Prices for oil and natural gas may fluctuate widely in response to relatively minor changes in supply and demand, market uncertainty and a variety of additional factors that are beyond our control and the control of producers on or around our land, such as:

These factors have at times resulted in, and may in the future result in, a reduction in global economic activity and volatility in the global financial markets and make it extremely difficult to predict future oil and natural gas price movements with certainty. A sustained decline in oil and natural gas prices may reduce the amount of oil and natural gas that can be produced economically by producers on or around our land, which may reduce such producers’ willingness to develop such land and use our land and resources and WaterBridge’s and Desert Environmental’s services. Producers on or around our land could also determine during periods of low oil and natural gas prices to shut-in or curtail production from wells on such land, or plug and abandon marginal wells that otherwise may have been allowed to continue to produce for a longer period under conditions of higher prices. The scale and duration of the impact of these factors cannot be predicted but could lead to an increase in our customers’ operating costs or a decrease in our or our customers’ revenues, and any substantial decline in the price of oil and natural gas or prolonged period of low oil and natural gas prices may materially and adversely affect our results of operations, cash flows and financial position.

Because a significant portion of our future revenue growth is expected to be derived from WaterBridge and Desert Environmental,WaterBridge, any development that materially and adversely affects either of their businesses, operations or financial condition could have a material adverse impact on us.

WaterBridge is, and Desert Environmental is anticipated to be, among our most significant customers and areis expected to play an increasingly important role in our financial performance over the long term. Accordingly, we are indirectly subject to the business risks faced by WaterBridge and Desert Environmental.WaterBridge. Because a significant portion of our revenues is derived from WaterBridge and Desert Environmental,WaterBridge, any development that materially and adversely affects either of WaterBridge’s or Desert Environmental’s businesses, operations or financial condition could have a material adverse impact on us.

Pursuant to the Shared Services Agreement, WaterBridge provides general and administrative services, as well as limited operational and maintenance services to us, together with fourfive dedicated employees providing field services and threefive dedicated employees providing corporate services. Our success depends on the efforts, experience, diligence, skill and network of business contacts of such personnel and the quality of services that WaterBridge offers. However, the allocation of such resources is generally within WaterBridge’s discretion. We can offer no assurance that WaterBridge will continue to provide services to us or that we will continue to have access to WaterBridge’s personnel or that the Manager will be able to recruit and retain personnel necessary to provide us with key services. If the Shared Services Agreement is terminated and no suitable replacement is found to provide management and operating services for our land, or if the Manager is unable to recruit and retain those personnel necessary to perform services under the Shared Services Agreement, we may not be able to execute our business plan, and our results of operations, cash flows and financial position may be materially and adversely affected.

The successful operation and growth of our business depends to a large extent on a small number of individuals to whom many key responsibilities within our business have been assigned. Such individuals hold positions with our affiliates, including Five Point, WaterBridgePoint and Desert Environmental,WaterBridge, and dedicate a portion of their time and resources to the activities of such affiliates, and there can be no assurance as to the future allocation of time and resources between our business, on the one hand, and our affiliates in which our employees,personnel, other service providers, and management team hold an interest, on the other hand. We rely on our key personnel for their knowledge of the energy industry, relationships within the industry and experience in operating a business in the Permian Basin. The loss of the services of one or more of these key personnel, and the inability to recruit or retain additional key personnel, could have an adverse effect on our business. Further, we do not have currently a succession plan for the replacement of, and do not maintain “key-person” life insurance policies on, such key personnel.

For the year ended December 31, 2024,2025, revenues from WaterBridge, ConocoPhillipsVTX Energy and EOG ResourcesConocoPhillips each individually comprised more than 10% of our total revenues and collectively represented 48%47% of our total revenues. EOGWaterBridge, Resources,VTX WaterBridgeEnergy, TPL and OccidentalEOG PetroleumResources each individually comprised 21%, 19%, 15%14% and 14%11%, respectively, of our total accounts receivable for the year ended December 31, 20242025 and collectively represented 48%65% of our total accounts receivable at such date. No other customer accounted for more than 10% of our total revenues or outstanding accounts receivables.

We expect to continue to depend on key customers to support our revenues for the foreseeable future, and although each of WaterBridge, ConcoPhillipsVTX Energy and EOG ResourcesConocoPhillips operates on our land under long-term contracts, each of these customers has the right to reduce or cease operations on our acreage at their sole discretion under certain circumstances, as our contracts with such customers generally do not contain minimum commitment provisions for land use or brackish water volumes to be purchased. See “Business—Customers; Material Contracts and Marketing” for further information on our agreements with our significant customers. The loss of revenue derived from any of these customers’ operations on our land could adversely affect our results of operations, cash flows and financial position. During times when the oil and natural gas markets weaken, our customers are more likely to experience financial difficulties, including generating less cash flow due to lower oil and natural gas prices and being unable to access or receive favorable terms in connection with debt or equity financing, which could result in a reduction in our customers’ activities on or around our land. Furthermore, the determination by a customer to initiate or maintain activities on or around our land largely depends on the location of our surface acreage relative to the nature and location of such customer’s operations and such customer’s need for the use of our land and resources. Our customers are limited to entities operating on and around our acreage in the Delaware Basin.

Concerns over global economic conditions, global health threats, trade policies, increased trade restrictions and tariffs, supply chain disruptions, increased demand, labor shortages associated with a fully employed U.S. labor force, geopolitical issues, inflation, interest rates, the availability and cost of credit and the United States financial markets and other factors have contributed to increased economic uncertainty. Although inflation in the United States had been relatively low for many years, there was a significant increase in inflation beginning in the second half of 2021, with a general decline beginning in the second half of 2022 and a relative settling in in 2023 and 2024. In addition, the incomingcurrent presidential administration has stated an intention to imposecontinue imposing tariffs on international goods, such as those produced in China.both China and Europe. To the extent that any U.S. trade policy results in retaliatory tariffs against the U.S., such as the recently announced tariffs from China on U.S. natural gas and crude oil, such developments could result in inflationary pressures and have an adverse effect on our customers’ business, and reduce demand for use of our land and services, which could have a material adverse effect on our business, results of operations and financial condition. Though we incorporate inflation escalators in most of our long-term customer contracts, contractual provisions providing for inflation escalators in certain contracts are subject to caps, which may limit the amount of any single pricing increase, and may also vary as to the commencement date of such increases and the timing and calculation of the applicable adjustment. As a result, inflation may outpace the revenue adjustments provided by those provisions. Our customers may also experience supply chain constraints, due to international trade policies or otherwise, and inflationary pressure on their cost structures, which could impact the revenues we receive from them. Our customers also may face shortages of equipment, raw materials, supplies, commodities, labor and services, which may prevent them from executing their development plans on or around our land. These supply chain constraints, trade policies and inflationary pressures may continue to adversely impact our customers’ operating costs and, if they are unable to manage their supply chain, it may impact their ability to procure materials and equipment in a timely and cost-effective manner, if at all, which could materially and adversely affect the revenues received in respect of our customers’ operations on or around our land.

Subject to certain exceptions, our customers assume responsibility for, including control and removal of, all other pollution or contamination that may result from their operations on our acreage, such as Desert Environmental’sWaterBridge’s oil reclamation, solid waste and landfill operations. We may have liability in such cases if we are grossly negligent or commit willful acts, or as owners of the land under laws that impose strict, joint and several liability for pollution clean-up, such as CERCLA (as defined herein). Our customers generally agree to indemnify and defend us against claims relating to contamination resulting from their operations and related closure and remedial obligations, damage or loss of a well, reservoir, geological formation, underground strata, or water resources, or the loss of oil, natural gas, mineral, or water, but sometimes such indemnity and defense is subject to exceptions for claims for gross negligence or willful misconduct, and we may not be able to collect under these indemnities if the applicable customer is in financial distress. Our customers also generally assume responsibility for claims arising from their employees’ personal injury or death, or the damage or loss of their property, to the extent that their employees are injured or their properties are damaged by operations on our acreage, but sometimes such indemnity and defense is subject to exceptions for claims resulting from our gross negligence or willful misconduct, and we may not be able to collect under these indemnities if the applicable customer is in financial distress. However, we might not succeed in enforcing such contractual risk allocation or might incur an unforeseen liability falling outside the scope of such risk allocation.

While we have implemented and maintain commercially reasonable security measures and safeguards, such security measures and safeguards may not be sufficient to protect against or effectively mitigate an attack. Attackers are increasingly using advances in technologies, such as artificial intelligence and encryption bypasses that may evade our efforts. Emerging artificial intelligence technologies may improve or expand the capabilities of malicious third parties in a way we cannot predict at this time,predict, including being used to develop new hacking tools, exploit vulnerabilities, obscure malicious activities and increase the difficulty detecting threats. Moreover, some of our networks and systems are managed by third-party service providers and are not under our direct control. We regularly enter into transactions with third parties, some of whom may have less sophisticated electronic systems or networks and may be more vulnerable to cyberattacks. Our reliance on these third parties means that any vulnerability in their systems could propagate to our own systems,systems or affect our data, increasing our risk exposure despite our internal controls.

Our future results following the Recent Acquisitions and otherour acquisitions will suffer if we do not effectively manage our expanded operations.

Since our formation, the size of our asset base has increased significantly. Our future success will depend, in part, upon our ability to manage this expanded business, which poses substantial challenges for management, including challenges related to the management and monitoring of expanded acreage, new operations and associated increased costs and complexity. We may also face increased scrutiny from governmental authorities as a result of the significant increase in the size of our business. There can be no assurances that we will be successful or that we will realize the expected operating efficiencies, cost savings, revenue enhancements or other benefits currently anticipated from theour Recent Acquisitions.acquisitions.

The ESA and comparable state laws restrict activities that may affect endangered or threatened species or their habitats. Similar protections are offered to migratory birds under the MBTA. To the degree that species listed under the ESA or similar state laws, or are protected under the MBTA, live in the areas where we and our customers operate, both our and our customers’ abilities to conduct or expand operations and construct facilities could be limited, or both we and our customers could be forced to incur additional material costs. Additionally, the FWS may make determinations on the listing of unlisted species as endangered or threatened under the ESA. For example, in November 2022, the FWS designated two distinct population segments of the lesser prairie chicken under the ESA, which live in certain areas in southeastern New Mexico and western Texas;Texas. however,The listing decision was challenged by the states of Texas, Kansas and Oklahoma, and various industry groups, with the U.S. SenateDistrict votedCourt to rescind this decision, althoughfor the jointWestern resolutionDistrict wasof vetoedTexas by President Biden, andvacating the listingrule decisionfor isthe currentlynorthern subjectdistrict topopulation litigation.segment in March 2025. In May 2024, the FWS designated the dunes sagebrush lizard under the ESA, which also lives in certain areas in southeastern New Mexico and western Texas,Texas. and thisThis listing decision is also subject to ongoing litigation. The designation of previously unidentified endangered or threatened species could indirectly cause us or our customers to incur additional costs, cause our or our customers’ operations to become subject to operating restrictions or bans and limit future development activity in affected areas, which developments could have a material adverse effect on our results of operations, cash flows and financial position.

Concerns over the risk of climate change have increased the focus by global, regional, national, state and local regulators on GHG emissions, including carbon dioxide emissions, and on transitioning to a lower-carbon future. A number of countries and states have adopted, or are considering the adoption of, regulatory frameworks to reduce GHG emissions. These regulatory measures may include, among others, adoption of cap and trade regimes, carbon taxes, increased efficiency standards, prohibitions on the sales of new automobiles with internal combustion engines, and incentives or mandates for battery-powered automobiles and/or wind, solar or other forms of alternative energy. These include laws such as the IRA, which appropriatesappropriated significant federal funding for renewable energy initiatives and amendsamended the CAA to impose a first-time fee on the emission of methane from sources required to report their GHG emissions to the EPA,EPA. beginningIn May 2024, the EPA issued a final rule to implement the IRA’s methane fee, although in calendarFebruary year2025, 2024Congress atrepealed $900the perrule tonunder the Congressional Review Act. Additionally, in the OBBBA, Congress delayed the implementation of methane,the increasingmethane toemission $1,200fee inuntil 2025,2034. and set at $1,500 for 2026 and each year after. However, weWe cannot predict whether, how, or whenif the incoming Trump Administration mightand take action to revise/ or repeal the methane emissions charge rule or the finalized EPA rules related to GHG emissions. Additionally, Congress may take further actions to repeal or revise the IRA, including with respect to the IRA or the methane emissions charge, which timing or outcome similarly cannot be predicted.fee. Compliance with changes in laws, regulations and obligations relating to climate change could result in increased costs of compliance for our customers on or around our land or costs of consuming oil and natural gas for such products, and thereby reduce demand for the use of our land and resources, which could reduce our profitability. Changes in laws and regulations may also result in delays or increased costs associated with obtaining permits needed for oil and natural gas operations. Additionally, our customers on or around our land could incur reputational risk tied to changing customer or community perceptions of our customers or their customers’ contribution to, or detraction from, the transition to a lower-carbon economy. These changing perceptions could lower demand for oil and natural gas products, resulting in lower prices and lower revenues as consumers avoid carbon-intensive industries, and could also pressure banks and investment managers to shift investments and reduce lending.

Separately, banks and other financial institutions, including investors, may decide to adopt policies that restrict or prohibit investment in, or otherwise funding, us or our customers on or around our land based on climate change-related concerns, which could affect our and our customers on or around our land’s access to and cost of capital for potential growth projects. However, this trend has been declining recently. Additionally, insurers may decide to raise rates and/or cease insuring us or our customers on or around our land based on climate change-related concerns.

Approaches to climate change and transition to a lower-carbon economy, including government regulation, company policies, and consumer behavior, are continuously evolving. For example, the SEC has adopted a new rule regarding climate change, which it has stayed pending various legal challenges, that, if ultimately made effective, implements significant disclosure obligations and would require us to update and develop our controls to accommodate these new obligations. The incoming Trump Administration, however, may seek to repeal the SEC rule though the timeline for any repeal, if at all, is subject to a number of uncertainties. While we intend to pursue opportunities related to the transition to a lower-carbon economy, there can be no assurance that our efforts will be successful. At this time, we cannot predict how such approaches may develop or otherwise reasonably or reliably estimate their impact on us or our customers’ financial condition, results of operations and ability to compete. However, any long-term material adverse effect on the oil and natural gas industry may affect our results of operations, cash flows and financial position.

Increased investor attention to environmental, social, and governance (“ESG”)sustainability-related matters may impact our or our customers’ business.

Companies across all industries are facing increasing scrutiny from stakeholders related to their ESGsustainability practices. Companies that do not adapt to or comply with investor or stakeholder expectations and standards, which are evolving, or which are perceived to have not responded appropriately to the growing concern for ESGsustainability issues, regardless of whether there is a legal requirement to do so, may suffer from reputational damage and the business, financial condition, and/or stock price of such a company could be materially and adversely affected. Increased attention to climate change, increasing and sometimes conflicting societal expectations on companies to address climate change, and potential consumer use of substitutes to energy commodities may result in increased costs, reduced demand for our customers’ products and services, lower demand for the use of our land and resources, reduced profits, increased governmental investigations and litigation against us.

Moreover, while we may create and publish voluntary disclosures regarding ESGsustainability matters from time to time, many of the statements in those voluntary disclosures are based on expectations and assumptions or hypothetical scenarios that may be incorrect or may change with the passage of time. Such expectations and assumptions or hypothetical scenarios are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established approach to identifying, measuring and reporting on many ESGsustainability matters. Additionally, voluntary disclosures regarding ESGsustainability matters, as well as any ESGsustainability disclosures mandated by law, could result in litigation or government investigations or enforcement action regarding the sufficiency or validity of such disclosures. In addition, failure or a perception (whether or not valid) of failure to adequately pursue or implement ESGsustainability strategies or achieve ESGsustainability goals or commitments, which are often aspirational, including any GHG reduction or neutralization goals or commitments, could result in litigation and damage our reputation, cause our investors or consumers to lose confidence in us, or otherwise negatively impact our operations. Moreover, even if we voluntarily elect to pursue climate or ESGsustainability goals, we cannot guarantee that we will be able to pursue or implement such goals because of potential costs, technical or operational obstacles, uncertainty in long-term assumptions and expectations or other market or technological developments beyond our control. Similarly, we cannot guarantee that participation in any sustainability,sustainability climate-related,or, or ESGclimate-related certification program or framework will have the intended results on our ESGsustainability profile.

In addition, certain organizations that provide proxy advisory services to investors on corporate governance and related matters have developed ratingsrating and proxy voting recommendation processes for evaluating companies on their approach to ESGsustainability matters. Currently, there are no universal standards for such scores or ratings, but the importance of sustainability evaluations is becoming more broadly accepted by certain investors and shareholders. Such ratings and proxy advisory services are used by some investors to inform their investment and voting decisions. Additionally, certain investors use these scores to benchmark companies against their peers and if a company is perceived as lagging, these investors may engage with companies to require improved ESGsustainability disclosure or performance. While such ratings do not impact all investors’ investment or voting decisions, unfavorable ESGsustainability ratings may lead to increased negative investor sentiment toward us or our customers and to the diversion of investment to other industries, which could have a negative impact on our share price and/or our access to and costs of capital.

Furthermore, certain public statements with respect to ESGsustainability matters, such as emissions reduction goals, other environmental targets, or other commitments addressing certain social issues, are becoming increasingly subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing” (i.e., misleading information or false claims overstating potential ESGsustainability benefits). For example, the SEC has recently taken enforcement action against companies for ESG-relatedsustainability-related misconduct, including alleged greenwashing. Certain regulators, such as the SEC and various state agencies, as well as non-governmental organizations and other private actors have also filed lawsuits under various securities and consumer protection laws alleging that certain ESG-statements,sustainability-statements, goals, or standards were misleading, false, or otherwise deceptive. Any alleged claims of greenwashing against us or others in our industry may lead to further negative sentiment and diversion of investments. We could also face increasing costs as we attempt to comply with and navigate further regulatory ESG-relatedsustainability-related focus and scrutiny.

Additionally, certain employment practices and social initiatives are the subject of scrutiny by both those calling for the continued advancement of such policies, as well as those who believe they should be curbed, including government actors, and the complex regulatory and legal frameworks applicable to such initiatives continue to evolve. We cannot be certain of the impact of such regulatory, legal and other developments on our business. More recent political developments could mean that the Company faces increasing criticism or litigation risks from certain “anti-ESGanti-sustainability” parties, including various governmental agencies.

We are subject to interest rate risk, which may cause our debt service obligations to increase significantly. The weighted average interest rate on borrowings outstanding under ourthe credit2025 facilityRevolving Credit Facility as of December 31, 20242025 was 8.39% in the case of revolving credit borrowings and 8.47% in the case of term loan borrowings.6.13%.

Borrowings under ourthe credit2025 facilityRevolving Credit Facility bear interest at variable rates and expose us to interest rate risk. The weighted average interest rate on our borrowings outstanding under ourthe credit2025 facilityRevolving Credit Facility as of December 31, 20242025 was 8.39% in the case of revolving credit borrowings and 8.47% in the case of term loan borrowings.6.13%. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even if the amount borrowed remained the same, and we would be required to devote more of our cash flow to servicing our indebtedness.

If we fail to comply with the restrictions and covenants in ourthe credit2025 facilityRevolving Credit Facility, the Indenture or our future debt agreements, there could be an event of default under the terms of such agreements, which could result in an acceleration of payment.

A breach of compliance with any restriction or covenant in ourthe credit2025 facilityRevolving Credit Facility, the Indenture or any of our future debt agreements could result in a default under the terms of the applicable agreement, and our ability to comply with such restrictions and covenants may be affected by events beyond our control. As a result, we cannot assure you that we will be able to comply with these restrictions and covenants. A default could result in acceleration of the indebtedness and a declaration of all amounts borrowed due and payable, which could have an adverse effect on us and negatively impact our ability to borrow. If an acceleration occurs, we may be unable to make all of the required payments and may be unable to find alternative financing. Even if alternative financing were available at that time, it may not be on terms that are favorable or acceptable to us. Additionally, we may not be able to amend ourthe credit2025 agreementRevolving Credit Facility or such future agreements governing our indebtedness or obtain necessary waivers on satisfactory terms.

Our obligations under ourthe credit2025 facilityRevolving Credit Facility are secured by a first priority security interest in substantially all of our assets and various guarantees.

The amounts borrowed pursuant to the terms of ourthe credit2025 agreementRevolving Credit Facility are secured by substantially all of our and our subsidiaries’ present and after-acquired assets. Additionally, our obligations under ourthe credit2025 facilityRevolving Credit Facility are jointly and severally guaranteed by us and our material subsidiaries.

As a result of the above, in the event of the occurrence of a default under ourthe credit2025 facility,Revolving Credit Facility, the administrative agent may enforce its security interests (for the ratable benefit of the lenders under ourthe credit2025 facilityRevolving Credit Facility and the other secured parties) over our and/or our subsidiaries’ assets that secure the obligations under ourthe credit2025 facility,Revolving Credit Facility, take control of our assets and business, force us to seek bankruptcy protection, or force us to curtail or abandon our current business plans. If that were to happen, you may lose all, or a part of, your investment in our Class A shares.

TheMaintaining the requirements of being a public company, including compliance with the reporting requirements of the Exchange Act, and the requirements of the Sarbanes-Oxley Act, maywill strainincrease demands on our resources, increase our costs and distractdivert management,management’s attention, and we may be unable to comply with these requirements in a timely or cost-effective manner.

As a result of the IPO, we became a public company, and, as such, we must comply with new laws, regulations and requirements, certain corporate governance provisions of the Sarbanes-Oxley Act, related regulations of the SEC and the NYSE rules,and withNYSE whichTexas we were not required to comply as a private company.rules. Complying with these statutes, regulations and requirements will occupy a significant amount of time of our board of directors and management and will significantly increase our costs and expenses. We are continuing our efforts to:

comply with rules promulgated by the NYSE and NYSE Texas;

continue to prepare and distribute periodic public reports in compliance with our obligations under the federal securities laws;

We are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which require management to certify financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of internal controls over financial reporting. AlthoughAs of December 31, 2025, we are requiredno tolonger disclosean changes“emerging madegrowth company,” as defined in our internal controls and procedures on a quarterly basis, we are not required to make our first annual assessment of our internal controls over financial reporting pursuant to Section 404 until the yearJOBS followingAct. thisAs Annual Report. Additionally, we are not required to havesuch, our independent registered public accounting firm is required to attest to the effectiveness of our internal controlscontrol untilover our first annual report subsequent to our ceasing to be an “emerging growth company” or a “smallerfinancial reporting company” under the applicable federal securities laws. Accordingly,and we may not beare required to have our independent registered public accounting firm attestdisclose, to the effectivenessextent ofmaterial, changes made in our internal controlscontrol untilover asfinancial latereporting as our annual report for the fiscal year ending December 31, 2029, if we are no longeron a “smallerquarterly reportingbasis. company.” Once it is required to do so, ourOur independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our controls are documented, designed, operated or reviewed. Compliance with these requirements will strainincrease demands on our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner.

Effective internal controls are necessary for us to provide reliable financial reports, prevent fraud and operate successfully as a public company. If we cannot provide reliable financial reports or prevent fraud, our reputation and operating results will be harmed. We are required, under Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting beginning in the year following this Annual Report.reporting. This assessment will need to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting. We will take steps to improve control processes as appropriate, validate through testing that controls are functioning as documented, and implement a continuous reporting and improvement process for our internal control over financial reporting. If we identify one or more material weaknesses in our internal control over financial reporting during the evaluation and testing process, we may be unable to conclude that our internal controls are effective.

Additionally, when we cease to be an “emerging growth company” under the federal securities laws, our independent registered public accounting firm may be required to express an opinion on the effectiveness of our internal controls. If we are unable to confirm that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an unqualified opinion on the effectiveness of our internal controls, we could lose investor confidence in the accuracy and completeness of our financial reports, which could cause the price of our Class A shares to decline.

We are a holding company and will have no material assets other than our equity interest in OpCo, and we do not have any independent means of generating revenue. To the extent OpCo has available cash we intend to cause OpCo to make (i) generally pro rata distributions to all holders (“OpCo Unitholders”) of limited liability interests in OpCo Units (“OpCo UnitholdersUnits”), including us, in an amount at least sufficient to allow us to pay taxes, (ii) additional distributions in an amount generally intended to allow the OpCo Unitholders (other than us) to satisfy their respective income tax liabilities with respect to their allocable share of the income of OpCo (based on certain assumptions and conventions), which additional distributions may be made on a pro rata basis to all OpCo Unitholders (including us) or a non-pro rata basis to OpCo Unitholders (other than us) in redemption of OpCo Units from such holders and (iii) non-pro rata distributions to us in an amount sufficient to cover our public company and other overhead expenses. In addition, as the sole managing member of OpCo, we intend to cause OpCo to make pro rata distributions to all of its unitholders, including to us, in an amount sufficient to allow us to fund dividends to our shareholders in accordance with our dividend policy, to the extent our board of directors declares such dividends. OpCo is a distinct legal entity and may be subject to legal or contractual restrictions that, under certain circumstances, may limit our ability to obtain cash from it. If OpCo is unable to make distributions, we may not receive adequate distributions, which could materially and adversely affect our results of operations, cash flows, financial position and ability to fund any dividends.

Furthermore, in connection with the consummation of the IPO, we entered into a shareholder’s agreement, dated July 1, 2024 (the “Shareholder’s Agreement”), with LandBridge Holdings, providing thatthat, for so long as LandBridge Holdings and certain affiliates beneficially own at least 40% of our outstanding common shares, LandBridge Holdings shall be entitled to designate a number of directors equal to a majority of the board of directors, plus one director; and for so long as LandBridge Holdings and such affiliates beneficially own at least 30%, 20% and 10% of our outstanding common shares, LandBridge Holdings shall be entitled to designate at least three directors, two directors and one director, respectively. So long as LandBridge Holdings is entitled to designate one or more directors and notifies the board of directors of its desire to remove, with or without cause, any director previously designated by it to the board of directors, we are required to take all necessary action to cause such removal. So long as LandBridge Holdings has the right to designate at least one director to our board of directors, it will also have the right to appoint a number of board observers, who will be entitled to attend all meetings of the board of directors in a non-voting, observer capacity, equal to the number of directors LandBridge Holdings is entitled to appoint.

LandBridge Holdings may become aware, from time to time, of certain business opportunities (such as acquisition opportunities) and may direct such opportunities to other businesses in which they have invested, in which case we may not become aware of or otherwise have the ability to pursue such opportunities. Furthermore, such businesses may choose to compete with us for these opportunities, possibly causing these opportunities to not be available to us or causing them to be more expensive for us to pursue. Furthermore, LandBridge Holdings, Five Point and WaterBridge, are not required to utilize facilities located on our land in connection with any business opportunities, whether currently existing or arising in the future, and may pursue development opportunities with competing landowners, or pursue an alternative land position without informing us of such opportunity or offering such opportunity to us. This renouncing of our interest and expectancy in any business opportunity may create actual and potential conflicts of interest between us and LandBridge Holdings, Five Point and WaterBridge, and result in less than favorable treatment of us and our shareholders if attractive business opportunities are pursued by LandBridge Holdings, Five Point and WaterBridge, for itstheir own benefit rather than for ours.

As of December 31, 2024,2025, we had 23,255,41927,838,199 Class A shares and 53,227,85249,250,916 Class B shares outstanding. Future sales by LandBridge Holdings after the exercise of the Redemption Right (as described in the OpCo LLC Agreement) or sales by other large holders of our Class A shares in the public markets, or the perception that such sales might occur, could have a material adverse effect on the price of our Class A shares or could impair our ability to obtain capital through an offering of equity securities. In addition, we have agreed to provide registration rights to LandBridge Holdings and certain other shareholders. In JanuaryJuly 2024,2025, we registered the resale of 59,058,27153,915,691 Class A shares (including Class A shares to be issued upon redemption of a corresponding number of Class B shares) by certain selling shareholders, including LandBridge Holdings, pursuant to certain registration rights agreements. Furthermore, we filed a registration statement with the SEC on Form S-8 providing for the registration of 3,960,000 Class A shares issued or reserved for issuance under the LandBridge Company LLC Long Term Incentive Plan. Subject to the satisfaction of vesting conditions, the expiration of lock-up agreements and the requirements of Rule 144 under the Securities Act, shares registered under the registration statement on Form S-8 have been made available for resale immediately in the public market without restriction. Alternatively, we may be required to undertake a future public or private offering of Class A shares and use the net proceeds from such offering to purchase an equal number of OpCo Units, with the cancellation of a corresponding number of Class B shares, from LandBridge Holdings.

We are a “controlled company” within the meaning of the NYSE and NYSE Texas rules and, as a result, qualify for and intend to rely on exemptions from certain corporate governance requirements.

LandBridge Holdings holds a majority of the voting power of our common shares. As a result, we are a controlled company within the meaning of the NYSE and NYSE Texas rules. Under the NYSE rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, a group or another company is a controlled company, and under NYSE Texas rules, a company of which more than 50% of the voting power is held by an individual, a group or another company is a controlled company. Under NYSE and NYSE Texas rules, controlled companies may elect not to comply with certain NYSE corporate governance requirements, including the requirements that:

a majority of the board of directors consists of independent directors as defined under the rules of the NYSE and NYSE Texas;

The following discussion and analysis of our financial condition and results of operations is based on, and should be read in conjunction with, our Financial Statements and notes thereto in PartItem 8, “Financial Statements and Supplementary Data” of this Annual Report. The following discussion contains “forward-looking statements” reflecting our current expectations, future plans, estimates, beliefs and assumptions concerning events and financial trends that may affect our future results of operations, cash flows and financial position. Our actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, including certain factors outside our control. Factors that could cause or contribute to such differences include, but are not limited to, market prices for oil and natural gas, production volumes, economic and competitive conditions, regulatory changes and other uncertainties, as well as those factors discussed below and elsewhere in this Annual Report, particularly in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements,” and in the prospectus under the heading “Risk Factors,” all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We assume no obligation to publicly update any of these forward-looking statements except as otherwise required by applicable law.

UnlessExcept as otherwise indicated or required by the context, references to “LandBridge,” the “Company,” “we,” “us,” “our” and like terms refer (i) prior to the consummation of the reorganizations of entities under common control (the “Corporate Reorganization”) and the IPO,initial public offering that occurred on July 1, 2024 (the “IPO”), to OpCo and its subsidiaries, our predecessor for financial reporting purposes,purposes and (ii) subsequent to the consummation of the Corporate Reorganization and the IPO, to LandBridge and its subsidiaries, including OpCo and its subsidiaries. Our financial statements have been prepared in accordance with GAAP. The consolidated financial statements as of and for the year ended December 31, 2024 included herein, reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of financial position, results of operations and cash flows for the period. All such adjustments are of a normal recurring nature.

The historical financial information in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” reflects only the historical financial results of us or our predecessor, OpCo, as applicable, and does not give pro forma effect to the East Stateline Acquisition, the Credit Agreement Amendment, the Corporate Reorganization or the IPO.

Land is a fundamental requirement for the development and production of energy and the construction and operation of critical infrastructure. As of December 31, 2024,2025, we owned approximatelyor 273,000managed more than 315,000 surface acres in and around the Delaware Basin sub-region in the prolific Permian Basin, which is the most active area for oil and gas exploration and development in the United States. Access to expansive surface acreage is necessary for oil and natural gas development, solar power generation, power storage, digital infrastructure and non-hazardous oilfield reclamation and solid waste facilities. Further, the significant industrial economy that exists to service and support energy and infrastructure development requires access to surface acreage to support those activities. Our strategy is to actively manage our land and resources to support and encourage energy and infrastructure development and other land uses that will generate long-term revenue and Free Cash Flow for us and returns to our shareholders.

We take an active approach to the commercial development of our land, seeking to maximize the long-term value of our surface acreage and our resources by identifying and seeking commercial partners looking to invest in developing and operating long-term assets within and beyond the oil and gas value chain on our land. For the year ended December 31, 2023 , we generated $52.1 million of non-oil and gas royalty revenue on our approximately 72,000 owned surface acres, or $724 per owned surface acre. For the year ended December 31, 2024 we increased non-oil and gas royalty revenue on the same 72,000 owned surface acres to $73.3 million or $1,018 per owned surface acre. The Spring 2024 Acquisitions and Recent Acquisitions contributed post-acquisition revenues of $20.6 million of non-oil and gas royalty revenue and approximately 201,000 owned surface acres. When annualized, revenue from such acquisitions is $62.7 million or $312 per acquired surface acre for the year ended December 31, 2024. Inclusive of the annualized revenue and expanded acreage as a result of the acquisitions, and the $73.3 million from existing acreage, the resulting pro forma non-oil and gas royalty revenue was $136.0 million, or $498 per owned surface acre for the year ended December 31, 2024 on our approximately 273,000 owned surface acres. We measure our revenue divided by our total acreage as a performance metric, which we refer to as “surface use economic efficiency.” Further, we are actively pursuing additional revenue streams beyond the hydrocarbon value chain to maximize utilization of our land and resources. We have entered into, or are currently pursuing, primarily long-term commercial relationships with businesses focused on solar power generation, power storage, power generation/microgrids, cryptocurrency mining and data management, as well as other renewable energy production, among other industries and applications. Similar to the other operations conducted on our land, we expect to enter into surface use or similar agreements with the owners of these projects from which we expect to receive surface use fees and other payments in connection with the utilization of our land, but we do not expect to own or operate such projects or expect to incur significant capital expenditures in connection therewith.

We share a financial sponsor, Five Point, and our management team with WaterBridge. WaterBridge is one of the largest water midstream companies in the United States and operates a large-scale network of pipelines and other infrastructure in the Delaware Basin that, as of December 31, 2024,2025, handles approximately 2.02.5 million bpd of water associated with oil and natural gas production, with approximately 3.44.2 million bpd of total handling capacity. These relationships provide our shared management team visibility into key areas of oil and natural gas production and long-term trends, which we leverage to encourage and support the development of critical infrastructure on our land and generate additional revenue for us. As of December 31, 2024,2025, WaterBridge operates approximately 767,0001.5 million bpd of water handling capacity on our land, with approximately 1.73.2 million bpd of additional permitted capacity available for future development on our land. We receive royalties for each barrel of produced water that WaterBridge handles on our land as well as surface use payments for infrastructure constructed on our land.

Recent1918 AcquisitionsRanch Acquisition

Despite these challenges, we believe the outlook for energy and infrastructure development, particularly within the Permian Basin, remains positive,positive. Additionally, such development may be aided by President Trump’s various Executive Orders relating to energy production, which willinclude requireexpedited significantapprovals for energy resource infrastructure as well as the removal of various impediments to the development of domestic energy resources, including oil and gas. We are well-positioned to benefit from the continued build out of supporting infrastructure in the region andwhich will require access to surface acreageacreage. In addition, we expect to supportbenefit suchfrom operations.advancements Anyin alternative forms of energy. While these incentives could further accelerate the transition of the U.S. economy away from the use of fossil fuelsfuels, towards lower- or zero-carbon emissions alternatives, like cleanalternative energy technologies,technologies often require access to material surface acreage and supporting infrastructure, which we are also well positioned to provide and facilitate. Please see the “Business” of this Annual Report for more information.

Net lossincome of $41.5$72.4 million as compared to net incomeloss of $63.2$41.5 million in 20232024;

Adjusted EBITDA Margin(1) of 88%,89%, anremained increaseconsistent of 2% as compared towith the prior year;

Operating cash flow margin of 62%,63%,remained aconsistent decrease of 11% as compared towith the prior year; and Free Cash Flow Margin(1) of 61%, aremained decreaseconsistent of 8% as compared towith the prior year;

Net income and net income margin for the year ended December 31, 2025 include non-cash share-based compensation expense of $45.3 million, of which $8.8 million is attributable to RSUs issued by the Company and $36.5 million is attributable to LBH Incentive Units. Net loss and net loss margin for the year ended December 31, 2024 include non-cash share-based compensation expense of $95.3 million, of which $4.0 million is attributable to RSUs issued by the Company, $72.6 million is attributable to NDB Incentive Units issued prior to the IPO and $18.7 million is attributable to LBH Incentive Units. Net income and net income margin for the year ended December 31, 2023 include non-cash share-based compensation income of $17.2 million attributable to the NDB Incentive Units. Any actual cash expense associated with such LBH Incentive Units is borne solely by LandBridge Holdings and not the Company. Distributions attributable to LBH Incentive Units are based on returns received by investors of LandBridge Holdings once certain return threshold have been met and are neither an obligation of the Company nor taken into consideration for distributions to investors in the Company. SeeRefer to Note 2 — Summary of Significant Accounting Policies and Note 10 — Share-Based Compensation to our consolidated financial statements for additional information regarding LBH Incentive Units.

Surface Use Royalties. We enter into SURAs and certain overarching SUAs with operators that require royalty payments to us based on a percentage of the customer’s gross revenues derived from use of our land and/or volumetric use of infrastructure installed on our land in exchange for rights of use of our land. Our SURAs typically obligate the operator to meter its volumetric utilization of infrastructure installed on our land and to include a report of such utilization for our review along with its periodic payment. Royalties we receive from operations under our SURAs include produced water transportation and handling operations, skim oil recovery and produced water throughput and waste reclamation. Our SURAs generally have terms ranging from a minimum of five years to 10 years, with the exception of brackish water sales agreements, which generally have a term of less than 12 months, and impose only nominal obligations on us. As of December 31, 2024: (i) produced water royalties under our SURAs ranged from $0.10 per barrel to $0.25 per barrel; and (ii) skim oil royalties under our SURAs ranged from 15% to 50% of net proceeds. However, the terms of our SURAs are negotiated on a customer-by-customer basis. Our SURAsus, typically do not include minimum purchase or use commitments by our customers but do generally provide for automatic renewal-based increases in royalties that are tied to the Consumer Price Index (“CPI”) or are negotiated on a case-by-case basis, depending on a number of factors, such as general economic conditions, the surface use of our land, competitor pricing and/or customer specific considerations. Our contractual provisions providing for inflation escalators are generally based on CPI or a specified fixed percentage, which may limit the amount of any single pricing increase. Such provisions may also vary as to the commencement date of such increases and the timing and calculation of the applicable adjustment based on the term of the agreement or particular use of our land. Our SURAs generally include standard provisions relating to maintenance by our customers of insurance of specified types and amounts, environmental, health and safety covenants and indemnification of us for the unauthorized use of hazardous material or environmental claims.basis.

Easements and other surface-related income. SUAs permit operators to install drilling sites, pipelines, roadways, electric lines and other facilities and equipment on land owned by us. We typically receive a per-rod or per-acre fee when the contract is executed, based on the aggregate amount of our land that is utilized under such SUA, and we often receive additional fees at the beginning of each renewal period or on a monthly or annual basis. Such agreements typically include pre-defined terms for fees that we will receive for our customers’ development and use of drilling sites, new and existing roads, pipeline easements and electric transmission easements. Our SUAs generally require our customers to use the resources from our land, such as brackish water and sand, for their operations on our land, for which we receive our customary fees. Our SUAs generally have terms ranging from a minimum of five years to 10 years, with early termination rights for non-use over a pre-determined period of time, typically 12 to 18 months. Beyond making our land available in accordance with our SUAs, our SUAs impose only nominal obligations on us. As of December 31, 2024: (i) standard pipeline easements ranged from $20 per rod to $450 per rod based, in part, on the diameter of the pipeline and the easement term; (ii) road easements for new roads ranged from $75 per rod to $150 per rod based, in part, on the easement term; (iii) utility line easements ranged from $20 per rod to $150 per rod based, in part, on capacity and width of the utility line and the easement term; and (iv) well pads ranged from $7,000 per acre to $12,000 per acre. However, the terms of our SUAs are negotiated on a customer-by-customer basis. Our SUAsmonths, typically do not include minimum commitments with respect to the type and amount of infrastructure to be installed on our property or the amount of revenue to be received by us,us but doand generally provide for automatic renewal-based increases in royalties that are tied to the CPI or negotiated on a case-by-case basis, depending on a number of factors, such as general economic conditions, the surface use of our land, competitor pricing and/or customer specific considerations. Our contractual provisions providing for inflation escalators are generally based on CPI or a specified fixed percentage, which may limit the amount of any single pricing increase. Such provisions may also vary as to the commencement date of such increases and the timing and calculation of the applicable adjustment based on the term of the agreement or particular use of our land. Our SUAs generally include standard provisions relating to maintenance by our customers of insurance of specified types and amounts, environmental, health and safety covenants and indemnification of us for environmental claims.basis.

Resource Royalties. We lease our surface acreage to customers to construct and operateoperate, at their expenseexpense, brackish water wells and sand mines to provide in-basin water and sand for use in oil and natural gas completion operations. Such customers hold the exclusive right to the water and sand they extractextracted from the leased surface acreage and may be required to make minimum royalty payments as a result. The agreements pursuant to which we receive resource royalties have varying primary terms of at least one year, contain rights for renewal so long as the customer continues to operate on our land and generally do not impose minimum production requirements on our customers. We typically receive a fee when the contract is executed and a fixed royalty per barrel of water or ton of sand extracted. In situations where our customers do not operate brackish water wells on our surface but require the use of water for their operations, customers generally must acquire such water from us for our customary fee.

Oil and Gas Royalties. Oil and gas royalties are received in connection with oil and natural gas mineral interests owned by us. Oil and gas royalties are recognized as revenue as oil and gas are produced or severed from the mineral lease. The oil and gas royalties we receive are dependent upon producer-specific location, contractual price differences and market prices for oil and natural gas, andwhich, producergiven specificsuch locationprices’ volatility, may cause our oil and contractualgas priceroyalties differences.to fluctuate. Oil and gas royalties also include mineral lease bonus revenues.revenues, Wewhich we receive lease bonus revenue by leasing our mineral interests to E&P companies. When we execute a mineral lease contract, the lease generally transfers the rights to any oil or natural gas discovered to the E&P company and grants us the right to a specified royalty interest payable on future production. Mineral lease bonuses are nonrefundable. Royalties from oil and natural gas production are generally negotiated on a case-by-case basis, depending on the particular mineral interests and holder of such mineral interests.

We expect our fee-based revenues to grow over time relative to our oil and gas royalties. While our focus is on fee-based arrangements, our oil and gas royalties fluctuate with market prices for oil and natural gas. The following table presents the amount and relative percentage of each component of our revenues for the following periods:

This Quarterly Report on Form 10-Q should be read in conjunction with the risk factors disclosed under the heading “Risk Factors” in the 2025 Form 10-K. There have been no material changes to the risk factors disclosed under the heading “Risk Factors” in the 2025 Form 10-K.

The following discussion and analysis of our financial condition and results of operations is based on, and should be read in conjunction with, the audited consolidated financial statements and related notes in our Annual Report on Form 10-K10‑K for the fiscal year ended December 31, 2025 (the “2025 Form 10-K10‑K”) and the accompanying unaudited condensed consolidated financial statements (“Financial Statements”) and notes thereto in “Part I,I — Item 1. “Financial Statements” of this Quarterly Report.

The following discussion contains “forward-looking statements” reflecting our current expectations, future plans, estimates, beliefs and assumptions concerning events and financial trends that may be outside our control and may affect our future results of operations, cash flows and financial position. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, which include those factors discussed below and elsewhere in this Quarterly Report, particularly in the sections titled “Part I — Item 1A. Risk Factors” in the 2025 Form 10-K and “Cautionary Note Regarding Forward-Looking Statements,” all of which are difficult to predict. In light of these risks, uncertainties and assumptions, actual results may differ materially from such forward-looking statements. We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law.

Land is a fundamental requirement for the development and production of energy and the construction and operation of critical infrastructure. As of MarchJune 31,30, 2026, we owned or managed more than 315,000325,000 surface acres in the Delaware Basin and adjacent Central Basin Platform sub-regions in the prolific Permian Basin, which is the most active area for oil and gas exploration and development in the United States. Access to expansive surface acreage is necessary for oil and natural gas development, solar power generation, power storage, digital infrastructure and non-hazardous oilfield reclamation and solid waste facilities. Further, the significant industrial economy that exists to service and support energy and infrastructure development requires access to surface acreage to support those activities. Our strategy is to actively manage our land and resources to support and encourage energy and infrastructure development and other land uses that will generate long-term revenue and Free Cash Flow for us and returns to our shareholders.

Over the last several years, theThe global economy and the oil and natural gas industry inhave particularcontinued hasto facedface substantial volatility. This has been driven by geopolitical conflicts, domestic political uncertainties, the enactment of the OBBBA, potential U.S. and foreign tariffs, evolving international trade policies and conflicts, OPEC+ production decisions, persistent elevated inflation, higher interest rates and capital costs and continued industry consolidation. In particular, the Delawarewar Basin,between sustainedthe highUnited levelsStates and Iran has driven significant commodity price and inflation volatility during the first half of exploration2026. Sustained disruption in the Strait of Hormuz, a key global oil and petrochemical chokepoint, could materially increase commodity prices and shipping costs, while further de-escalation could cause prices to decline – either outcome may influence E&P operators’ drilling and production activitydecisions. haveGiven ledthe tounresolved labornature shortagesof andthe supplyIran chainWar, disruptions.we Thesecannot challengespredict havethe directlyextent impactedor drilling,duration completionof and production efforts by E&P companies. Additionally,related volatility inor commodityits pricesultimate —impact particularlyon WTIour crudebusiness. oil and Henry Hub natural gas benchmarks, with especially pronouncedAdditionally, volatility in realized prices at the Waha Hub —given havegas influencedtakeaway constraints in the region may also influence E&P operators’ development plans, rig counts and overall activity levels. MoreElevated recently,interest therates ongoingand conflicta instronger Iran,U.S. includingdollar thehave disruption of the global oil supply through the Strait of Hormuz, has significantly driven up commodity prices,also increased inflationarycapital pressures and increased the volatility of oil and gas prices globally,costs, which may influencefurther temper E&P operators’ drillingspending anddespite productionelevated decisions.commodity prices.

Broader macroeconomic and policy developments, including provisions in the OBBBA (which extended certain tax incentives beneficial to fossil fuels while introducing new uncertainties)developments and shifts in international trade policies (such as the imposition of tariffs or product restrictions), could impair our customers’ ability to secure raw materials, equipment or financing. This, in turn, may reduce their operational activity on or around our surface acreage in the Delaware Basin. Any escalation in U.S. trade disruptions or retaliatory measures from other nations could further adversely affect demand for our land.

Despite these challenges, we believe the outlook for energy and infrastructure development, particularly within the Permian Basin, remains positive. Additionally,Notwithstanding suchvolatility from the Iran War and broader geopolitical conditions, E&P activity in the Permian Basin, including the Delaware Basin, has remained largely resilient given favorable well economics. This continued development may be aided by President Trump’s various Executive Orders relating to energy production, which include expedited approvals for energy resource infrastructure as well as the removal of various impediments to the development of domestic energy resources, including oil and gas. We are well-positioned to benefit from the continued build out of supporting infrastructure in the region which will require access to surface acreage. In addition, we expect to benefit from advancements in alternative forms of energy. Alternative energy technologies often require access to material surface acreage and supporting infrastructure, which we are also well positioned to provide and facilitate.

FirstSecond Quarter Results

Significant financial and operating highlights for the firstsecond quarter of 2026 include:

Revenues of $51.0$66.8 million, an increase of 16%41% as compared to the firstsecond quarter of 2025;

Net income of $17.9$31.0 million, an increase of 16%68% as compared to the firstsecond quarter of 2025;

Net income margin of 35%,46% whichas remainedcompared consistentto withnet income margin of 39% in the firstsecond quarter of 2025;

Adjusted EBITDA(1) of $44.9$59.8 million, an increase of 16%41% as compared to the firstsecond quarter of 2025;

Adjusted EBITDA Margin(1) of 88%,89%, which remained consistent with the firstsecond quarter of 2025;

Cash flow from operating activities of $41.1$41.4 million, an increase of 158%11% as compared to the firstsecond quarter of 2025;

Free Cash Flow(1) of $40.9$40.2 million, an increase of 158%11% as compared to the firstsecond quarter of 2025;

Operating cash flow margin of 81%,62%, ana increasedecrease of 125%22% as compared to the firstsecond quarter of 2025; and Free Cash Flow Margin(1) of 80%,60%, ana increasedecrease of 122%21% as compared to the firstsecond quarter of 2025;2025.

Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are non-GAAP financial measures. SeeRefer to “Non-GAAP Financial Measures” for more information regarding these non-GAAP financial measures along withand reconciliations to the most comparable GAAP measures.

Subsequent to the firstsecond quarter of 2025, we acquired approximately 39,00047,000 acres, inclusive of approximately 12,000 leasehold acres and approximately 3,600 acres subject to a long-term management agreement, through various acquisitions including the 1918 Acquisition, which will impact the comparability of our results of operations. We expect to pursue opportunistic future land acquisitions that complement or expand our current land position, which may impact the comparability of our results.

DuringIn November 2025, OpCo entered into the 2025 Revolving Credit Facility with available capacity of $275.0 million which matures on the earlier of (a) June 30, 2030, and (b) the date that is 91 days prior to the stated maturity of the Notes, if, on such date, the outstanding principal amount of the Notes is greater than $50 million.

Additionally, duringin November 2025, OpCo issued $500.0 million aggregate principal amount of 6.25% fixed-rate senior unsecured notes due 2030.

Three Months Ended MarchJune 31,30, 2026 Compared to Three Months Ended MarchJune 31,30, 2025

Total revenues. Total revenues increased by $7.1$19.3 million.million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. Please see our discussion below regarding comparative period variances in revenue sources.

Surface use royalties. Surface use royalties increased by $4.8$8.9 million.million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was primarily attributable to increased produced water handling and associated skim oil royalties of $4.7 million and solid waste disposal and reclamation royalties of $0.1 million on our surface for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.surface. The increase associated with produced water handling royalties is primarily driven by a significant increase in produced water handling volume of approximately 311622 MbblMBbl/d. The volume and associated revenue increase was primarily attributable to the Wolf Bone Ranch Acquisition and the 1918 Acquisition in 2025 coupled with organic growth on our overall Stateline surface acreage.

Resource sales. Resource sales decreasedincreased by $1.9 million. Brackish water sales decreased $2.7$0.6 million for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily attributable to caliche sales of $1.1 million due to construction of infrastructure assets in the areas surrounding our surface acreage partially offset by lower brackish water sales of $0.5 million. Brackish water sales volume decreased by 5.71.9 million barrels, or 47%,17%, to 6.59.5 million barrels for the three months ended MarchJune 31,30, 2026, as compared to 12.211.4 million barrels for the three months ended MarchJune 31,30, 2025, partially offset by a per unit sales price increase of approximately 4%,8%, primarily driven by the customer contract mix for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. Caliche sales increased $0.8 million for the same comparative period, primarily due to construction of energy infrastructure assets in the areas surrounding our surface acreage.

General and administrative expense. General and administrative expense, excluding share-based compensation expense, increased by $0.9 million. The increase was primarily attributable to increased professional services fees of $0.6$1.1 million primarily associated with legal expense related to commercial opportunities and personnel-related expenses of $0.3 million due to incremental personnel headcount for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily attributable to increased corporate shared services allocation from WaterBridge of $0.4 million to support underlying growth of the business, increased professional services fees of $0.4 million primarily related to commercial opportunities, and personnel-related expenses of $0.2 million due to incremental personnel headcount.

Depreciation, depletion and amortization. Depreciation, depletion and amortization increased by $1.8 million.million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was primarily attributable to amortization of intangiblesintangible assets acquired in the 1918 Acquisition during 2025.

Interest expense. Interest expense,expense increased by $1.5$1.3 million.million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was primarily attributable to a higher weighted average debt balance during the three months ended MarchJune 31,30, 2026, as compared to borrowings under our then-existing debt instruments for the three months ended March 31, 20252026 partially offset by lower interest on the Notes and 2025 Revolving Credit Facility.

The following table sets forth a reconciliation of net income and net income margin as determined in accordance with GAAP to Adjusted EBITDA and Adjusted EBITDA Margin for the periods indicated.

As of MarchJune 31,30, 2026, the Company had $500.0 million of principal debt related to our 6.25% fixed-rate senior unsecured notes due 2030 and $45.0 million of outstanding borrowings under the 2025 Revolving Credit Facility. As of MarchJune 31,30, 2026, the Company had $259.7$269.8 million of liquidity comprised of the $230.0 million of available borrowing capacity under the 2025 Revolving Credit Facility,Facility and $29.7$39.8 million of cash and cash equivalents.

On MayAugust 5,4, 2026, our board of directors declared a dividend on our Class A shares of $0.12 per share, payable on JuneSeptember 18,10, 2026 to shareholders of record as of JuneAugust 4,27, 2026, and a corresponding required cash distribution to OpCo unitholders.

On MayAugust 5,4, 2026, our board of directors approved a payment for tax distributions from OpCo to OpCo unitholders (other than the companyCompany) in the amount of $9.3$8.1 million. This amount is inclusive of OpCo unitholders’ (other than the Company) pro rata share of estimated federal income tax and an additional tax distribution in excess of the Company’s then-current income tax obligation as provided for under the OpCo LLC Agreement. This amount is expected to be paid during the secondthird quarter of 2026.

Cash FlowFlows

The following table summarizes our cash flow for the periodssix indicatedmonths ended June 30, 2026 and 2025: