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

Investing in our Common Stock involves significant risks, some of which are described below. In evaluating our business, investors should carefully consider the following risk factors. These risk factors contain, in addition to historical information, forward-looking statements that involve substantial risks and uncertainties. Our actual results could differ materially from the results discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below. The order in which the following risks are presented is not intended to reflect the magnitude of the risks described. The occurrence of any of the following risks could have a material adverse effect on our business, financial condition, results of operations and prospects. In that case, the trading price of our Common Stock could decline, perhaps significantly, and you therefore may lose all or part of your investment.

Our end markets experience constantly changing demand depending on a number of factors that are out of our control. In our fire retardant business, demand is dependent on the occurrence of fires, which are seasonal and dependent on environmental and other factors. Changes in the geographic location, occurrence, severity and duration of fires may change demand for our fire retardant products. Seasonality in the fire retardant end market could periodically result in higher or lower levels of revenue and revenue concentration with a single or small number of customers. If we experience a low fire season, the WUI does not continue to expand or if FFF do not continue to account for a growing percentage of the firefighting foam market in the coming years as we expect, this could materially and adversely affect our business. In our specialty products business,segment, we supply P2S5 which is primarily used in the lubricant additives market to produce a critical compound in lubricating oils. As more electric vehicles emerge on the automobile market, use of the internal combustion engine may decline, thereby lessening demand for some of our specialty products. In our newly acquired medical manufacturing business (the “MMT Business”), demand for our machinery, parts, and consumables may be impacted by end user demand for medical procedures involving catheters and guidewires, new medical device launch cadence by our customers, and for engineered machinery, capital investment plans by medical device manufacturers. Our inability to offset the volatility of these end markets through diversification into other markets, could materially and adversely affect our business, financial condition and results of operations.

AIn our fire safety segment, a small number of customers represent a significant portion of our revenue. A certain number of contracts with these customers are on an on-demand, as-needed basis, and there are no guaranteed minimums included in such contracts. In other cases, manufacturing disruptions at customer sites can significantly decrease customer demand. Because of the concentrated nature of our customer base and contract terms applicable to such customers, our quarterly revenue and results of operations may fluctuate from quarter to quarter and are difficult to estimate. In addition, any cancellation of orders or any acceleration or delay in anticipated product purchases by our larger customers could materially affect our revenue and results of operations in any quarterly period. We may be unable to sustain or increase our revenue from our larger customers or offset any discontinuation or decrease of purchases by our larger customers with purchases by new or other existing customers. To the extent one or more of our larger customers experience significant financial difficulty, bankruptcy or insolvency, this could have a material adverse effect on our sales and our ability to collect on receivables, which could harm our business, financial condition and results of operations. In addition, certain customers, including some of our larger customers, have negotiated, or may in the future negotiate, volume-based discounts or other more favorable terms from us, which can and have had a negative effect on our gross margins or revenue. We expect that such concentrated purchases will continue to contribute materially to our revenue for the foreseeable future and that our results of operations may fluctuate materially as a result of such larger customers’ buying patterns.

We are dependent on sales to the USDA Forest ServiceService, the U.S. Bureau of Land Management and the state of California, which account for a substantial portion of our revenue related to our Fire Safety segment.

Sales to the USDA Forest ServiceService, the U.S. Bureau of Land Management and the state of California represent a substantial portion of our revenues, and this concentration of our sales makes us substantially dependent on those customers. This customer concentration makes us subject to the risk of nonpayment, nonperformance, re-negotiation of terms or non-renewal by these major customers under our commercial agreements. If the USDA Forest ServiceService, the U.S. Bureau of Land Management and/or the state of California reduce their spend on our fire retardant products, we may experience a reduction in revenue and may not be able to sustain profitability, and our business, financial condition and results of operations would be materially harmed.

Our realized margins depend on the differential of sales prices over our total supply costs. Our profitability is thereforealso sensitive to changes in product prices caused by changes in supply, transportation and storage capacity or other market conditions. Market, weather or other conditions beyond our control may disrupt our expected supply of product, and we may be required to obtain supply at increased prices that cannot be passed through to our customers.

Unapproved or improper use of our products, or inadequate disclosure of risks or other information relating to the use of our products can lead to injury or other serious adverse events. These events could lead to recalls or safety alerts relating to our products (either voluntary or as required by governmental authorities), and could result, in certain cases, in the removal of a product from the market. A recall could result in significant costs and lost sales and customers, enforcement actions and/or investigations by state and federal governments or other enforcement bodies, as well as negative publicity and damage to our reputation that could reduce future demand for our products. Personal injuries relating to the use of our products can also result in significant product liability claims being brought against us. See “—Some of the products we produce may cause adverse health consequences or environmental impacts, which exposes us to product liability and other claims, and we may, from time to time, be the subject of indemnity claims. Indemnity and insurance coverage could be inadequate or unavailable to cover such product liability and other claims.”

We rely on third-party logistics suppliers for the distribution, storage and transportation of raw materials, operating supplies and products. Delays or disruptions in the supply chain may adversely impact our ability to manufacture and distribute products thus impacting business financials.products. Any failure to properly store our products may similarly impact our manufacturing and distribution capabilities, impacting business financials. If we were to lose a supplier it could result in interruption of product shipments, cancellation of orders by customers and termination of relationships. This, along with the damage to our reputation, could have a material adverse effect on our revenues and, consequently, our business, financial condition and results of operations.

In addition, actions by a third-party logistics supplier that fail to comply with contract terms or applicable laws and regulations could result in such third-party logistics supplier exposing us to claims for damages, financial penalties and reputational harm, any of which could have a material adverse effect inon our business, financial condition and results of operations.

Raw materials necessary for the production of our products and with limited sources of supply are susceptible to supply cost increases which we may not be able to pass onto customers, disruptions to theincreases, supply chain,disruptions, and supply changes, any of which could disrupt our supply chain and could lead to us not meeting our contractual requirements.operations.

AllA substantial amount of the raw materials thatused goto into manufacturingmanufacture our fire retardantsafety products and specialty products are sourced from third-party suppliers.suppliers, Somesome of thewhich keyare raw materials used to manufacture our products comederived from limited or sole sources of supply. We are therefore subject to the risk of shortages andshortages, long lead times in the supply of these raw materials and the risk thatmaterials, our suppliers discontinuediscontinuing or modifymodifying the raw materials used in our products. We have a global supply chain, and geopolitical conflicts may cause delays in the global supply chain, decreased shipping capacitycapacity, price fluctuations and a reduction in overall shipping resources, resulting in longer lead times for key raw materials to be transported to our facilities. In addition, the lead times associated with certain raw materials are lengthy and preclude rapid changes in quantities and delivery schedules. We may experience raw materials shortages and price fluctuations of certain key raw materials and materials, and the predictability of the availability and pricing of these raw materials may be limited. Raw materials shortages or pricing fluctuations could be material in the future. In the event of a raw materials shortage, supply interruption or material pricing change from suppliers of these raw materials, we may not be able to develop alternate sources in a timely manner or at all in the case of sole or limited sources. Developing alternate sources of supply for these raw materials is time-consuming, difficult, and costly as they require extensive qualifications and testing, and we may not be able to source these raw materials on terms that are acceptable to us, or at all, which may undermine our ability to meet our requirements or to fill customer orders in a timely manner. Any interruption or delay in the supply of any of these raw materials, or the inability to obtain these raw materials from alternate sources at acceptable prices and within a reasonable amount of time, would adversely affect our ability to meet our scheduled product deliveries to our customers. This could adversely affect our relationships with our customers and could cause delays in shipment of our products and adversely affect our business, financial condition and results of operations.

In addition, increased raw materials costs, labor costs and costs of services could result in lower gross margins. Even where we are able to pass increased raw materials costs along to our customers, there may be a lapse of time before we are able to do so such that we must absorb the increased cost. If we are unable to buy these raw materials in quantities sufficient to meet our requirements on a timely basis, we will not be able to deliver products to our customers, which may result in such customers using competitive products instead of our products. These risks are further exacerbated by increases in inflation, along with geopolitical events and global supply chain disruptions, which have caused, and may in the future cause, global economic uncertainty, which may make it more difficult or costly to obtain raw materials, labor and services on terms acceptable to us.

The industries in which we operate and in which we intend to operate in the future aremay be subject to change.change Ifand we failfailure to continuously innovate andcoupled towith provideincreased competition or the introduction of lower-cost, higher-performance or more environmentally preferred products thatcould gainreduce marketdemand acceptance,for weour mayproducts beand unableadversely affect our ability to attract new customers orand retain existing customers, and hence our business, financial condition and results of operations may be adversely affected.customers.

The industries in which we operate are, and those we intend to operate in the future aremay be, subject to change, including through shifts in customer demandsdemands, regulatory requirements, industry standards and regulatorypractices, requirementstechnological developments and through the emergence of new industry standardscompetitors and practicessubstitute andproducts. new competitors. Thus, ourOur success will depend,depends, in part, on our ability to respond to these changes in a cost-effective and timely manner.manner Weby needcontinuously to anticipate the emergence of new technologiesinnovating and assessdeveloping theirproducts that achieve market acceptance. We also need to invest significant resources in research and development in order to keep our products competitive in the market.

This requires us to anticipate the emergence of new technologies, assess their market acceptance and invest significant resources in research and development to keep our products competitive. However, research and development activities are inherently uncertain, and we mightmay encounter practicaldifficulties difficultiesor delays in commercializing ournew researchor andimproved developmentproducts, results, which could result inincur excessive research and development expensescosts or delays.fail to develop products that are commercially successful. If we are unable to keep uppace with the technological developments and anticipateor market trends, or if new technologiestechnologies, industry standards or regulatory requirements render our products less attractive or obsolete, we may be unable to attract new customers mayor noretain longerexisting be attracted to our products. As a result, our business, financial condition and results of operations would be materially and adversely affected.customers.

IfCompetitors may also introduce new productsproducts, areincluding introducedfire intoretardants thebased marketon different chemistry or raw materials that are lower in cost, have enhanced performance characteristics or are considered preferable for environmental or other reasons,reasons. If such products reduce or replace demand for someour products in significant volumes, our business, financial condition and results of our productsoperations could be reducedmaterially orand eliminated.adversely affected.

Our intellectualbusinesses propertydepend isupon ofmany particularproprietary importancetechnologies, forincluding apatents, numberlicenses, of the products that we manufacturetrademarks and sell.trade secrets. The trademarks and patents that we own may be challenged, and because of such challenges, we could eventually lose our exclusive rights to use and enforce such patented technologies and trademarks, which could adversely affect our competitive position, business, financial condition and results of operations. We are licensed to use certain patents and technology owned by other companies to manufacture products complementary to our own products. We pay royalties for these licenses in amounts not considered material, in the aggregate, to our consolidated results.

InFurthermore, in some of the countries in which we operate, the laws protecting patent holders are significantly weaker than in the United States, countries in the European Union (the “EU”) and certain other countries. Weaker protection may assist competing manufacturers in becoming more competitive in markets in which they might not have otherwise been able to introduce competing products for a number of years. As a result, we tend to rely more heavily upon trade secret and know-how protection in these regions, as applicable, rather than patents and this may adversely impact our sales, business, financial condition and results of operations.

Our commercial success will depend in part on our success in obtaining and maintaining issued patents and other intellectual property rights in the United States and elsewhere. If we do not adequately protect our intellectual property, competitors may be able to use our processes and erode or negate any competitive advantage we may have, which could harm our business.

Furthermore, though an issued patent is presumed valid and enforceable, its issuance is not conclusive as to its validity or its enforceability and it may not provide us with adequate proprietary protection or competitive advantages against competitors with similar products. Competitors may also be able to design around our patents. Other parties may develop and obtain patent protection for more effective technologies, designs or methods. We may not be able to prevent the unauthorized disclosure or use of our knowledge or trade secrets by consultants, suppliers, vendors, former employeesClaims and currentproceedings employees. The laws of some foreign countries do notto protect our proprietaryintellectual rights to the same extent as the laws of the United States, and we may encounter significant problems in protecting our proprietary rights in these countries. Such claims and proceedingsproperty can also distract and divert management and key personnel from other tasks important to the success of our business. In addition, intellectual property litigation or claims could force us to do one or more of the following: (i) cease selling products that contain asserted intellectual property; (ii) pay substantial damages for past use of the asserted intellectual property; (iii) obtain a license from the holder of the asserted intellectual property, which may not be available on reasonable terms; and (iv) redesign or rename, in the case of trademark claims, our products to avoid infringing the rights of third parties. Such requirements could adversely affect our revenue, increase costs, and harm our business, financial condition and results of operations.

The following discussion and analysis should be read in conjunction with the audited consolidated financial statements and notes thereto included in this Annual Report. This Annual Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended,amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, such statements are subject to the “safe harbor” created by those sections and involve risks and uncertainties. Forward-looking statements are based on our management’s beliefs and assumptions and on information available to our management as of the date hereof. As a result of many factors, such as those set forth under Part I, Item 1A “Risk Factors” in this Annual Report, our actual results may differ materially from those anticipated in these forward-looking statements, accordingly, you should not place undue reliance on these forward-looking statements. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

PerimeterWe Solutions,conduct Inc.our (“we,”operations “us,”globally, “our,”with orapproximately the “Company”) is a global solutions provider for the Fire Safety and Specialty Products industries. Approximately 79%76% of our annual revenues is derived in the United States, approximately 10% in Europe and approximately 6%7% in CanadaCanada, with the remaining approximately 5%7% spread across various other countries. Our business is organized and managed in two reporting segments: Fire Safety and Specialty Products.

The Fire Safety businesssegment is a formulator and manufacturer of fire management products that help our customers combat various types of fires, including wildland, industrial, structural, flammable liquids and other types of fires. Our Fire Safety businesssegment also offers specialized equipment and services, typically in conjunction with our fire management products to support our customers’ firefighting operations. Our specialized equipment includes air baseairbase retardant storage, mixing, and delivery equipment; mobile retardant bases; retardant ground application units; mobile foam equipment; and equipment that we custom design and manufacture to meet specific customer needs. Our service network can meet the emergency resupply needs of overapproximately 150 air tanker bases in North America, as well as many other customer locations globally. The Fire Safety segment is built on the premise of superior technology, exceptional responsiveness to our customers’ needs, and a “never-fail” service network. SignificantThe endFire marketsSafety includesegment primarilysells government-relatedproducts entitiesto andgovernment are dependent on approvals, qualifications, and permits granted by the respective governmentsagencies and commercial customers around the world.

WePrior operateto the acquisition of MMT in January 2026, we operated five business units within our two reporting segments. The business unit structure is meant to promote decentralized execution and accountability, and maintain the geography- and product-specific focus and granularity necessary to drive continued improvement in our key operational value drivers. Our key operational value drivers are profitable new business, pricing our products and services to the value they provide, and continued productivity improvements. Each business unit has a business unit manager, who is responsible for achieving targeted financial and operational results.

Growth in Fire Safety Segment

Our business is highly dependent on the needs of government agencies to suppress fires. As such, our financial condition and results of operations are significantly impacted by weather as well as environmental and other factors affecting climate change, which impact the number and severity of fires in any given year. Historically, sales of our products have been higher in the summer season in the northern hemisphere of each fiscal year due to weather patterns which are generally correlated to a higher prevalence of wildfires. This is in part offset by the disbursement of our operations in both the northern and southern hemispheres, where the summer seasons alternate.

In recent years, the global economy and labor markets have experienced significant inflationary pressures attributable to ongoing economic recovery and supply chain issues, in part due to the impacts of the conflicts in Ukraine and the Middle East. While the Company has limited exposure in regions with active conflict,conflicts, it continues to monitor and take actions with its customers and suppliers to mitigate the impact of these inflationary pressures in the future. Actions to mitigate inflationary pressures with suppliers include aggregation of purchase requirements to achieve optimal volume benefits, negotiation of cost-reductions and identification of more cost competitive suppliers. While these actions are designed to offset the impact of inflationary pressures, the Company cannot provide assurance that they will be successful in fully offsetting increased costs resulting from inflationary pressure. In addition, interest payments for borrowings under the Company’s revolving credit facility are based on variable rates, and any continued increase in interest rates may reduce the Company’s cash flow available for other corporate purposes.

The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto included in Part I, Item 1 of this quarterly report on Form 10‑Q for the quarter ended MarchJune 31,30, 2026 (this “Quarterly Report”). This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, such statements are subject to the “safe harbor” created by those sections and involve risks and uncertainties. Forward-looking statements are based on our management’s beliefs and assumptions and on information available to our management as of the date hereof. As a result of many factors, such as those set forth under “Item 1A. Risk Factors” included in our 2025 Annual Report, our actual results may differ materially from those anticipated in these forward-looking statements, accordingly, you should not place undue reliance on these forward-looking statements. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

In recent years, the global economy and labor markets have experienced significant inflationary pressures attributable to ongoing economic recovery and supply chain issues, in part due to the impacts of the conflicts in Ukraine and the Middle East. While the Company has limited exposure in regions with active conflicts, it continues to monitor and take actions with its customers and suppliers to mitigate the impact of these inflationary pressures in the future. Actions to mitigate inflationary pressures with suppliers include aggregation of purchase requirements to achieve optimal volume benefits, negotiation of cost-reductions and identification of more cost competitive suppliers. While these actions are designed to offset the impact of inflationary pressures, the Company cannot provide assurance that they will be successful in fully offsetting increased costs resulting from inflationary pressure. In addition, interest payments for borrowings under the Company’s amendedAmended and restatedRestated revolvingRevolving creditCredit facilityFacility (as defined below) are based on variable rates, and any continued increase in interest rates may reduce the Company’s cash flow available for other corporate purposes.

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

The following table sets forth our results of operations for each of the periods indicated (in thousands):

Net Sales. Net sales increased by $53.0$51.2 million for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025. Net sales in the Fire Safety segment increased by $8.3$8.8 million, representing higher fire retardant sales of $6.4 million and higher suppressant sales of $13.4 million offset by lower fire retardant sales of $5.1$2.4 million. Fire suppressant sales increased $7.2 million in North America and $6.2 million in other geographies. Fire retardant sales decreasedincreased $7.5$7.3 million in North America, offset by ana increasedecrease of $2.4$0.9 million in other geographies. Fire suppressant sales increased $5.9 million outside North America, offset by a decrease of $3.5 million in North America. Net sales in the Specialty Products segment increased $44.7$42.4 million, including a $41.4$47.9 million increase in revenue due to recently acquired businessesbusinesses, andoffset by a $3.3$5.5 million increasedecrease in base businesses. The Company considers that revenue attributable to base businesses includes revenue from acquired businesses that have been owned for a full four quarters after the date of acquisition.

Cost of Goods Sold. Cost of goods sold increased $30.4$34.8 million for the three months ended MarchJune 31,30, 2026 compared to the same period in 2025, primarily due to recently acquired businesses.

Selling, General and Administrative Expense. Selling, general and administrative expense increased by $6.8$11.0 million for the three months ended MarchJune 31,30, 2026 compared to the same period in 2025, primarily due to recently acquired businesses.

Other OperatingAmortization Expense. Other operatingAmortization expense increased $8.5by $9.4 million for the three months ended MarchJune 31,30, 2026,2026 compared to the same period in 2025, primarily due to costsrecently relatedacquired to the Company’s acquisition of MMT in January 2026.businesses.

InterestOther Expense,Operating net.Expense. InterestOther expense,operating netexpense increased $14.7$3.3 million for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, primarily due to highercosts averagerelated debt outstanding resulting fromto the Company’s offeringrecent of the 2034 Notes in January 2026.acquisitions.

IncomeInterest TaxExpense, Benefitnet. (Expense).Interest Incomeexpense, taxnet benefitincreased was $23.1$9.7 million for the three months ended MarchJune 31,30, 2026, compared to income tax expense of $12.5 million for the same period in 2025. The change is2025, primarily due to increasedhigher benefitsaverage debt outstanding resulting from stock-basedthe compensationCompany’s andoffering non-deductibleof compensation.the 2034 Notes in January 2026.

Segment Adjusted EBITDA is defined as income (loss) before income taxes plus net interest and other financing expenses, and depreciation and amortization, adjusted on a consistent basis for certain non-recurring, unusual or non-operational items. These items include (i) restructuring, (ii) acquisition related costs, (iii) founder advisory fee expenses, (iv) stock-based compensation expense, (v) purchase accounting impact - inventory step up and (vi) foreign currency loss (gain). We use Segment Adjusted EBITDA, to evaluate operating performance by segment, for business planning purposes and to allocate resources. The following tables provide information for our net sales and Segment Adjusted EBITDA (in thousands) for the three and six months ended MarchJune 31,30, 2026 compared to the same period in 2025:

Segment Adjusted EBITDA for our Fire Safety segment increased by $8.6$1.1 million during the three months ended MarchJune 31,30, 2026 compared with the same period in 2025. The increase was primarily due to higher net sales, as described above. Costs grew at a slower pace than revenues due to strong cost control, product mix and fixed costs leverage.

Segment Adjusted EBITDA for our Specialty Products segment increased by $14.5$13.2 million during the three months ended MarchJune 31,30, 2026 compared with the same period in 2025. The increase was primarily due to contributions from recently acquired businesses.

The following table provides a reconciliation of financial measures that are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) to non-GAAP measures. The Company believes that these non-GAAP financial measures are useful to investors because they provide investors with a better understanding of the Company’s past financial performance and future results. The Company’s management uses these non-GAAP financial measures when it internally evaluates the performance of its business and makes operating decisions, including internal operating budgeting, performance measurement, and discretionary compensation. Segment Adjusted EBITDA should not be considered an alternative to net income (loss), operating income (loss), cash flows provided by (used in) operating activities or any other measure of financial performance or liquidity presented in accordance with U.S. GAAP (in thousands):

(1) For the three months ended MarchJune 31,30, 2026, $0.3$1.4 million was related to restructuring and other non-recurring costs and $1.1 million was related to litigation costs arising from a contractual dispute regarding control of the P2S5 facility, which is currently operated by Flexsys Chemical Company,Company. andFor the three months ended June 30, 2025, $0.1 million was related to restructuring and other non-recurring costs. For the three months ended March 31, 2025, $0.5 million was related to restructuring and other non-recurring costs, and $0.4 million was related to the Redomiciliation Transaction.

(2) For the three months ended MarchJune 31,30, 2026, $5.6$4.5 million was primarily related to the impact of purchase accounting on the cost of inventory sold. The acquired inventory acquiredwas receivedrecorded at fair value, resulting in a purchase accounting step-up in basis.

We believe that our existing cash and cash equivalents of $91.6$82.8 million, net cash flows generated from operations and availability under the Amended and Restated Revolving Credit Facility as of MarchJune 31,30, 2026 will be sufficient to meet our current capital expenditures, working capital, and debt service requirements for at least 12 months from the filing date of this Quarterly Report. As of MarchJune 31,30, 2026, we expect our remaining fiscal year 2026 capital expenditure budget to cover both our maintenance and growth capital expenditures. We may also raise capital through other various financing sources available to us, including the issuance of equity and/or debt securities through public offerings or private placements, to fund our acquisitions, the Annual Advisory Amounts and long-term liquidity needs. Our ability to complete future offerings of equity or debt securities and the timing of these offerings will depend upon various factors including prevailing market conditions and our financial condition.

As of MarchJune 31,30, 2026, the Company did not have any outstanding borrowings under the Amended and Restated Revolving Credit Facility and was in compliance with all covenants, including the financial covenants.

The 2029 Notes and the 2034 Notes are subject to customary negative covenants, including but not limited to, certain limitations, including among other things, the ability to declare or pay dividends or make certain other payments, purchase, redeem or otherwise acquire or retire for value any equity interests or otherwise make any restricted payments, conduct certain asset sales, make certain restricted investments; incur certain indebtedness, grant certain liens, enter into certain transactions with affiliates, and consolidate, merge or transfer all or substantially all of the assets of our subsidiaries on a consolidated basis. The indentures governing the 2029 Notes and the 2034 Notes also contain customary events of default and remedies (including acceleration). As of MarchJune 31,30, 2026, the Company was in compliance with all covenants, including financial covenants.

Debt issuance costs incurred in connection with securing the 2029 Notes and the 2034 Notes were capitalized and are amortized using the effective interest method over the term of the 2029 Notes and the 2034 Notes and included in interest expense in the accompanying condensed consolidated statements of operations and comprehensive (loss) income. The unamortized portion of the debt issuance costs is included as a reduction to the carrying value of the 2029 Notes and the 2034 Notes which have been recorded as long-term debt, net in the accompanying condensed consolidated balance sheets. The Company incurred $10.1 million of debt issuance costs as a result of the 2034 Notes for the threesix months ended MarchJune 31,30, 2026.

The approximate dollar value of shares that may yet be repurchased under the Share Repurchase Plan was $100.0 million as of MarchJune 31,30, 2026. During the three and six months ended MarchJune 31,30, 2026, the Company did not repurchase any shares under its Share Repurchase Plan. During the three and six months ended MarchJune 31,30, 2025, the Company repurchased 888,4542,886,221 shares.and 3,774,675 shares, respectively. The repurchased shares are recorded at cost and are being held in treasury.

For 2025, the EverArc Founder Entity was entitled to receive a Fixed Annual Advisory Amount of 2,357,061 shares of Common Stock or a value of $65.7 million, based on an average price of $27.89 per share of Common Stock (the “2025 Fixed Amount”). The EverArc Founder Entity was also entitled to receive a Variable Annual Advisory Amount for 2025 of 14,462,123 shares of Common Stock, or a value of $403.4 million (the “2025 Variable Amount” and together with the 2025 Fixed Amount, the “2025 Advisory Amounts”). The EverArc Founder Entity elected to receive approximately 79.6% of the 2025 Advisory Amounts in shares of Common Stock (13,387,003 shares of Common SharesStock) and approximately 20.4% of the 2025 Advisory Amounts in cash ($95.7 million). To satisfy the 2025 Advisory Amounts, the Company paid $95.7 million in cash on February 19, 2026 and issued 13,387,003 shares of Common Stock on March 3, 2026.

The summary of our cash flows is as follows (in thousands):

Cash used in operating activities was $89.0$89.6 million for the threesix months ended MarchJune 31,30, 2026 and cash provided by operating activities was $23.7$20.9 million for the threesix months ended MarchJune 31,30, 2025. For the threesix months ended MarchJune 31,30, 2026, the primary components of operating cash flows were net incomeloss of $72.9$108.7 million, non-cash benefitscharges of $69.9$186.0 million and net operating asset investments of $92.0$166.9 million. For the threesix months ended MarchJune 31,30, 2025, the primary components of operating cash flows were net income of $56.7$24.5 million, non-cash benefitscharges of $49.6$48.9 million and net operating asset reductionsinvestments of $16.6$52.5 million.

Cash used in investing activities was $688.1$700.8 million and $14.8$42.8 million for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. During the threesix months ended MarchJune 31,30, 2026, we purchased a business for $682.3 million and purchased property and equipment of $5.8$18.5 million. During the threesix months ended MarchJune 31,30, 2025, we purchased property and equipment of $17.6 million, purchased intangible assets of $15.2 million, and purchased a business for $10.0 million and purchased property and equipment of $4.8 million.

Cash provided by financing activities was $542.8$547.2 million for the threesix months ended MarchJune 31,30, 2026 and cash used in financing activities was $8.4$40.6 million for the threesix months ended MarchJune 31,30, 2025. During the threesix months ended MarchJune 31,30, 2026, we received proceeds from an issuance of long term debt of $550.0 million and received proceeds from exercises of options of $3.0$7.6 million, offset by payment of debt issuance costs of $10.1 million and $0.1$0.3 million in principal payments on finance lease obligations. During the threesix months ended MarchJune 31,30, 2025, we repurchased shares of outstanding Common Stock for $8.2$40.4 million andmillion, made $0.2$0.5 million in principal payments on finance lease obligations.obligations, and received proceeds from exercises of options of $0.3 million.

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements which have been prepared in accordance with U.S. GAAP. Our significant accounting policies and estimates are consistent with those discussed in Note 2, “Summary of Significant Accounting Policies and Recent Accounting Pronouncements” of our consolidated financial statements included in our 2025 Annual Report filed on Form 10-K with the SEC on February 26, 2026. Significant estimates made by management in connection with the preparation of the accompanying condensed consolidated financial statements include the fair value of purchase consideration and assets acquired and liabilities assumed in a business combination, stock options and founder advisory fees. We are not presently aware of any events or circumstances that would require us to update our estimates, assumptions or revise the carrying value of our assets or liabilities. Our estimates may change, however, as new events occur and additional information is obtained. As a result, actual results may differ significantly from our estimates, and any such differences may be material to our financial statements. For information on the impact of recently issued accounting pronouncements, see Note 2, “Summary of Significant Accounting Policies and Recent Accounting Pronouncements” in the notes to the condensed consolidated financial statements included in this Quarterly Report.