Annual Report for Fiscal Year Ending 12-31, 2025 (Form 10-K)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion and analysis in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this annual report on Form 10-K.

In preparing the management's discussion and analysis, the registrant presumes that you have read or have access to the discussion and analysis for the preceding fiscal year.

19

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended or the Reform Act. All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws, including, but not limited to, any projections of earning, revenue or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions of performance; and statements of belief; and any statements of assumptions underlying any of the foregoing. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following:

The Company's ability to raise capital and the terms thereof; and other factors referenced in this Form 10-K.

The use in this Form 10-K of such words as "believes", "plans", "anticipates", "expects", "intends", and similar expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. These forward-looking statements present the Company's estimates and assumptions only as of the date of this report. Except for the Company's ongoing obligation to disclose material information as required by the federal securities laws, the Company does not intend, and undertakes no obligation, to update any forward-looking statements.

Although the Company believes that the expectations reflected in any of the forward-looking statements are reasonable, actual results could differ materially from those projected or assumed or any of the Company's forward-looking statements. The Company's future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties.

PLAN OF OPERATIONS

Overview

Camber is a growth-oriented diversified company with interests in innovative, industry-changing or industry-leading technologies, as well as an interest in a company that provides custom energy and power solutions to commercial and industrial clients in North America. Our existing portfolio of innovative technologies includes: (i) a majority interest in an entity with intellectual property rights to a fully developed, patented, proprietary medical and bio-hazard waste treatment system using ozone technology; and (ii) a majority interest in entities with the intellectual property rights to fully developed, patented and patent pending, proprietary electric transmission and distribution broken conductor protection systems, and a license to a patented clean energy and carbon-capture system with exclusivity in Canada and for multiple locations in the United States.

Our interest in the custom energy and power solutions industry consists of a forty-nine percent interest in Simson-Maxwell Ltd., a Canadian corporation.

We are also exploring other energy-related opportunities and/or technologies which are currently generating revenue, or have a reasonable prospect of generating revenue within a reasonable period of time.

Medical Waste Disposal System Using Ozone Technology:

In January 2022, Viking acquired a 51% interest in Viking Ozone, which owns the intellectual property rights to a patented (i.e., US Utility Patent No. 11,565,289), proprietary medical and biohazard waste treatment system using ozone technology. The technology is designed to be a sustainable alternative to incineration, chemical, autoclave and heat treatment of bio-hazardous waste, and for the treated waste to be classified as renewable fuel for waste-to-energy ("WTE") facilities in many locations around the world.

20

In November, 2025, Viking Ozone was advised that its flagship VKIN-300 medical and bio-hazardous waste pre-treatment unit (the "VKIN-300 Unit") passed the acceptance review by Laboratoire national de métrologie et d'essais ("LNE") in France to obtain official certification of compliance with French Standard NFX 30-503, regarded as one of the world's strictest standards for waste decontamination equipment. On or about November, 7, 2025, the LNE confirmed that Viking Ozone's application for a certificate of conformity for the VKIN 300 pretreatment unit is complete, satisfactory, and compliant with the requirements of standard NF X 20-703-1 of April 2024, and that formal attestation of conformity under the French decree Arrêté du 20 avril 2017 (Ministry of Social Affairs & Health, relating to pretreatment by disinfection of regulated medical care waste - DASRI) is expected to be issued once the decree is updated to reference French Standard NFX 30-503 and LNE's own certification framework is amended accordingly. Given the conclusion of the evaluation report received from the LNE it is likely the certification will be obtained but there are no assurances of such result.

Broken Conductor Protection Technologies:

In February 2022, Viking acquired a 51% interest in two entities, Viking Sentinel and Viking Protection, that own the intellectual property rights to patented and patent pending proprietary electric transmission and distribution broken conductor protection systems. On August 1, 2025, Viking acquired a 51% interest in Viking Distribution which owns the intellectual property rights to patented and patent pending proprietary electric distribution broken conductor protection systems.

The broken conductor protection systems are designed to detect a break in a transmission line, distribution line, or coupling failure, and to immediately terminate the power to the line before it reaches the ground. The technology is intended to increase public safety and reduce the risk of causing an incendiary event, and to be an integral component within grid hardening and stability initiatives by electric utilities to improve the resiliency and reliability of existing infrastructure.

A summary of the applicable patents, pending patents and/or patent applications associated with the intellectual property owned by Viking Sentinel, Viking Protection and/or Viking Distribution as at the date hereof is as follows:

Application #	Description	Application Filed	Notice of Allowance Received	Patent Issued
U.S. No. 17/672,422	Electric Transmission Line Ground Fault Prevention Methods Using Dual, High Sensitivity Monitoring	Yes	Yes	Yes
U.S. No. 17/693,504	Electric Transmission Line Ground Fault Prevention Systems Using Dual, High Sensitivity Monitoring	Yes	Yes	Yes
U.S. No. 17/821,651	Electric Transmission Line Ground Fault Prevention systems using dual parameter monitoring with high sensitivity relay devices in parallel with low sensitivity relay devices	Yes	Yes	Yes
U.S. No. 18/227,670	Electric Transmission Line Ground Fault Prevention Methods Using Multi-Parameter High Sensitivity Monitoring	Yes	Yes	Yes
U.S. No. 17/300,485	End of Line Protection with Trip-Signal Engaging	Yes	Yes	Yes
U.S. No. 17/628,545	End of Line Protection with Blocking	Yes	Yes	Yes
International Application No. PCT/US2024/010627	Electric Transmission Line Ground Fault Prevention Methods Using Multi-Parameter High Sensitivity Monitoring	Yes
US No. 18/064,152	Electric Distribution Line Ground Fault Prevention Systems Using Dual, High Sensitivity Monitoring With High Sensitivity Relay Devices	Yes	Yes	Yes
PCT INT'L Application PCT/US23/83181	Electric Distribution Line Ground Fault Prevention Systems Using Dual, High Sensitivity Monitoring With High Sensitivity Relay Devices	Yes
US No. 12,407,184 B2	Distribution Line Ground Fault Prevention With Blown Fuse Protection on Single Phase	Yes	Yes	Yes
US Application SN 18/920,865	Electric Distribution Line Ground Fault Prevention Device Using Dual Parameter High Sensitivity Monitoring Small Current Reduction With Small Increase in Negative Sequence Current	Yes	Yes	Yes
US Application 19/362,887	Electric Distribution Line Ground Fault Prevention Systems Using Dual Parameter High Sensitivity Relay	Yes

21

Clean Energy and Carbon-Capture System:

In August 2021, Viking entered into an Exclusive Intellectual Property License Agreement (the "IPLA") with ESG Clean Energy, LLC ("ESG"), to utilize ESG's patent rights and know-how related to stationary electric power generation and heat and carbon dioxide capture (the "ESG Clean Energy System"). The intellectual property licensed by Viking includes certain patents and/or patent applications, including the following:

No.	Reference No.	Details	Status	Directed To
	5874.001A	U.S. Patent No.: 10,774,733, File date: October 24, 2018, Issue date: September 15, 2020, Titled: "Bottoming Cycle Power System."	Issued	Systems for generating bottoming cycle power and producing distilled water
	5874.001AEP	European Patent No.: EP3728891, Issue Date: April 12, 2023; Validated in the United Kingdom, France and Germany; European Patent Application No.: EP18870699.8, International File date: October 24, 2018, PCT Publication No.: WO2019084208, European Publication No.: EP3728801A1; Titled: "Bottoming Cycle Power System."	Issued	Systems for generating bottoming cycle power and producing distilled water
	5874.004	U.S. Patent No.: 11286832, Issue Date: March 29, 2022; U.S. Patent Application No.: 17/224,200, File date: April 7, 2021, Titled: "Bottoming Cycle Power System."	Issued	Systems for generating bottoming cycle power and capturing carbon dioxide
	5874.004A	U.S. Patent No.: 11415052, Issue Date: August 16, 2022; U.S. Patent Application No.: 17/448,943, File date: September 27, 2021, Titled: "Systems and Methods Associated With Bottoming Cycle Power Systems for Generating Power and Capturing Carbon Dioxide."	Issued	Systems and Methods for generating bottoming cycle power and capturing carbon dioxide
	5874.004B	US Patent No.: 11624307, Issue Date: April 11, 2023; U.S. Patent Application No.: 17/580,777, File date: January 21, 2022, Titled: "Systems and Methods Associated With Bottoming Cycle Power Systems for Generating Power and Capturing Carbon Dioxide."	Issued	Systems and Methods for generating bottoming cycle power and capturing carbon dioxide
	5874.004WO	PCT International Patent Application No.: PCT/US2022/022827, File date: March 31, 2022, Titled: "Bottoming Cycle Power Systems."	Pending	Systems and Methods for generating bottoming cycle power and capturing carbon dioxide
	5874.004AWO	PCT International Patent Application No.: PCT/US2022/076635, File date: September 19, 2022, Titled: "Systems And Methods Associated With Bottoming Cycle Power Systems For Generating Power And Capturing Carbon Dioxide; Published on October 13, 2022 with Publication No.: WO 2022/216519	Pending	Systems and Methods for generating bottoming cycle power and capturing carbon dioxide
	5874.005	U.S. Patent No.: 11,339,712, Issue Date: May 24, 2022; U.S. Patent Application No.: 17/358,197, File date: June 25, 2021, Titled: "Bottoming Cycle Power System."	Issued	Systems for generating bottoming cycle power, capturing carbon dioxide and producing associated products such as distilled water
	5874.005A	U.S. Patent No.: 11,346,256, Issue Date: May 31, 2022; U.S. Patent Application No.: 17/448,938, File date: September 27, 2021, Titled: "Systems and Methods Associated With Bottoming Cycle Power Systems for Generating Power, Capturing Carbon Dioxide and Producing Products."	Issued	Systems and Methods for generating bottoming cycle power, capturing carbon dioxide and producing associated products such as distilled water and diesel exhaust fluid (DEF)
	5874.005B	U.S. Patent Application No.: 17/661,382, File date: April 29, 2022, Titled: "Systems and Methods Associated With Bottoming Cycle Power Systems for Generating Power, Capturing Carbon Dioxide and Producing Products."	Issued	Systems and Methods for generating bottoming cycle power, capturing carbon dioxide and producing associated products such as distilled water and diesel exhaust fluid (DEF).
	5874.005AWO	PCT International Patent Application No.: PCT/US2022/034298, File date: June 21, 2022, Titled: "Systems and Methods Associated With Bottoming Cycle Power Systems for Generating Power, Capturing Carbon Dioxide and Producing Products."; Published on December 29, 2022 with Publication No.: WO 2022/271667	Pending	Systems and Methods for generating bottoming cycle power, capturing carbon dioxide and producing associated products such as distilled water and diesel exhaust fluid (DEF).
	5874.006	U.S. Patent No.: 11639677, Issue Date: May 2, 2023; U.S. Patent Application No.: 17/934,279, File date: September 22, 2022, Titled: "System And Method For Capturing Carbon Dioxide From A Flow Of Exhaust Gas From A Combustion Process."	Issued	Systems and Methods of Capturing Carbon Dioxide Utilizing The Exhaust Gas From An Internal Combustion Engine
	5874.007A	U.S. Non-Provisional Patent Application No.: 18/312930, Filing date: May 5, 2023; Converted to a non-provisional from provisional case no: 5874.007P1; U.S. Provisional Patent Application No.: 63/371546, File date: August 16, 2022, Titled: "Absorption Chiller System With A Transport Membrane Heat Exchanger."	Pending	Systems and Methods for removing water from air or exhaust gas using an absorption chiller system having a transport membrane heat exchanger as an evaporator

22

The ESG Clean Energy System is designed to, among other things, generate clean electricity from internal combustion engines and utilize waste heat to capture approximately 100% of the carbon dioxide (CO2) emitted from the engine without loss of efficiency, and in a manner to facilitate the production of certain commodities. Patent No. 11,286,832, for example, covers the invention of an "exhaust-gas-to-exhaust-gas heat exchanger" that efficiently cools - and then reheats - exhaust from a primary power generator so greater energy output can be achieved by a secondary power source with safe ventilation. Another key aspect of this patent is the development of a carbon dioxide capture system that utilizes the waste heat of the carbon dioxide pump to heat and regenerate the absorber that enables carbon dioxide to be safely contained and packaged.

The Company intends to sell, lease and/or sub-license the ESG Clean Energy System to third parties.

On August 13, 2025, Viking, ESG and Scuderi Group, Inc. signed an Amendment to the IPLA pursuant to which Scuderi was added, effective as of such date, as an additional licensor or grantor, as applicable, under the IPLA, and was vested with all future rights and obligations of ESG thereunder, and Scuderi assumed all remaining duties, liabilities and benefits of ESG under the IPLA, to the same extent as ESG. Further, all general references to ESG in the IPLA are deemed to read "ESG and Scuderi" and all provisions containing obligations of ESG are deemed to be obligations of ESG and Scuderi, jointly and severally. Scuderi is the owner of the intellectual property licensed to Viking by ESG.

In July 2025, ESG filed a voluntary bankruptcy petition under Chapter 11 with the Massachusetts Bankruptcy Court. At the time of filing, ESG had not yet constructed and put into commercial operation the carbon capture or water removal systems at its power generation facility in Massachusetts. There is currently significant uncertainty as to whether ESG and/or Scuderi will be able to fully complete and commercialize its technology, which is necessary for the Company to market the technology and practically benefit from rights and entitlements under the license.

Custom Energy and Power Solutions:

On August 6, 2021, Viking acquired approximately 60.5% of the issued and outstanding shares of Simson-Maxwell Ltd., a Canadian federal corporation, for $7,958,159 in cash. Simson-Maxwell manufactures and supplies power generation products, services and custom energy solutions. Simson-Maxwell provides commercial and industrial clients with efficient, flexible, environmentally responsible and clean-tech energy systems involving a wide variety of products, including CHP (combined heat and power), tier 4 final diesel and natural gas industrial engines, solar, wind and storage. Simson-Maxwell also designs and assembles a complete line of electrical control equipment including switch gear, synchronization and paralleling gear, distribution, Bi-Fuel and complete power generation production controls. Operating for over 80 years, Simson-Maxwell's branches assist with servicing a large number of existing maintenance arrangements and meeting the energy and power-solution demands of the Company's other customers.

On April 1, 2025, Viking entered into a Share Subscription Agreement with T&T Power Group Inc., Remora EQ LP, Simmax Corp., and Simson-Maxwell. The SSA relates to a restructuring of the ownership of Simson-Maxwell that resulted in Camber ceasing to have a controlling interest in Simson-Maxwell.

Under the SSA, T&T agreed to (i) subscribe for 952 Class A Common Shares of Simson-Maxwell for an aggregate subscription price of approximately CAD $2.28 million; (ii) purchase 903 Class A Common Shares from Remora for an agreed purchase price; and (iii) purchase 681 Class A Common Shares from Simmax for an agreed purchase price. T&T also agreed to provide up to CAD $3.0 million in additional working capital to Simson-Maxwell on closing or at such time as is reasonably required to meet the cash requirements of Simson-Maxwell, and to repay on or within a reasonable period following the closing amounts owing under Simson-Maxwell's then outstanding senior secured credit facilities. T&T acquired the Subscription Shares by paying the subscription price in cash. T&T acquired the Remora Shares by paying approximately 3.5% of the purchase price in cash and issuing a promissory note for the remaining balance, maturing on December 1, 2025. T&T acquired the Simmax Shares by issuing a promissory note to Simmax, also maturing on December 1, 2025.

Following the closing of the transactions described above, T&T and Viking are the only remaining shareholders of Simson-Maxwell. T&T owns 51% of Simson-Maxwell's issued and outstanding Class A Common Shares, and Viking owns the remaining 49%. Viking did not sell or purchase any shares in connection with the Simson Share Transactions; however, Viking's ownership decreased from approximately 60.5% to 49%. As a result of the reduction in Viking's ownership interest and ceasing to have control over Simson-Maxwell, Camber no longer consolidates Simson-Maxwell's financial results in its consolidated financial statements. The Company instead accounts for its investment in Simson-Maxwell at fair value.

23

Viking also entered into a Unanimous Shareholders Agreement on April 1, 2025 with T&T and Simson-Maxwell. The USA governs the ownership and management of Simson-Maxwell and provides that T&T is entitled to nominate two members to Simson-Maxwell's board of directors, and Viking is entitled to nominate one member. The USA also contains a call and a put option. Under the call option, T&T has the option, exercisable at any time within the first 36 months, to purchase Viking's 49% ownership interest for CAD $5.75 million (approximately $4.2 million). Under the put option, Viking has the option, exercisable at any time after 36 months, to require T&T to purchase Viking's 49% ownership interest for CAD $7.75 million (approximately $5.7 million).

Going Concern Qualification

The Company's consolidated financial statements included herein have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company generated a net loss of $5,326,618 for the year ended December 31, 2025, as compared to a net loss of $70,259,894 for the year ended December 31, 2024. The loss for the year ended December 31, 2025, was comprised of, among other things, certain non-cash items, including: (i) impairment of intangible assets of $3,728,011; (ii) amortization of debt discount of $3,217,568; (iii) depreciation, depletion and amortization of $291,617, and; (iv) a gain on the partial disposal of interest in subsidiary of $6,169,824.

As of December 31, 2025, the Company had stockholders' deficit of $43,368,722, long-term debt, net of current, of $43,698,407 and a working capital deficiency of $15,845,860. The largest components of current liabilities creating this working capital deficiency was accrued interest on note payable to Discover of $8,099,682, amounts due to related parties of $1,338,330, related party accounts payable of $1,810,000 and current portion of long-term debt of $1,202,956.

These conditions raise substantial doubt regarding the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its ability to utilize the resources in place to generate future profitable operations, to develop additional acquisition opportunities, and to obtain the necessary financing to meet its obligations and repay its liabilities arising from business operations when they come due. Management believes the Company may be able to continue to develop new opportunities and may be able to obtain additional funds through debt and / or equity financings to facilitate its business strategy; however, there is no assurance of additional funding being available. These consolidated financial statements do not include any adjustments to the recorded assets or liabilities that might be necessary should the Company have to curtail operations or be unable to continue in existence.

RESULTS OF OPERATIONS

The following discussion of the consolidated financial condition and results of operations of the Company should be read in conjunction with the consolidated financial statements and the related Notes included elsewhere in this Report.

Liquidity and Capital Resources

		Years Ended December 31,
Working Capital:		2025				2024
Current assets		$	1,581,798			$	13,679,377
Current liabilities			17,427,658				31,335,187
Working capital deficit		$	(15,845,860	)		$	(17,655,810	)

		Years Ended December 31,
Cash Flows:		2025				2024
Net cash used in operating activities		$	(2,325,462	)		$	(1,468,439	)
Net cash provided by investing activities			316,533				150,704
Net cash provided by financing activities			2,173,806				526,323
Increase (decrease) in cash during the period			164,877				(791,412	)
Cash and cash equivalents, beginning of period			114,648				906,060
Cash and cash equivalents, end of period		$	279,525			$	114,648

24

Net cash used in operating activities increased to $(2,325,462) during the year ended December 31, 2025, as compared to $(1,468,439) in the comparable period in 2024. Net cash provided by changes in operating assets and liabilities declined by approximately $3.2 million. This was partially offset by a reduction of approximately $2.3 million in cash operating losses. Both of these changes as compared to the prior year were primarily the result of the deconsolidation of Simson-Maxwell on April 1, 2025.

Net cash flows from investing activities increased to $316,533 during the year ended December 31, 2025, as compared to $150,704 in the comparable period in 2024. This increase was due to payments received on notes receivable during the year and a reduction in fixed asset acquisitions as compared to the prior year, partially offset by the proceeds on the sale of oil and gas properties recorded in the prior year.

Net cash from financing activities increased to $2,173,806 during the year ended December 31, 2025, as compared to $526,323 in the comparable period in 2024. This increase was mainly due to increases in net proceeds from the issuance of long-term debt and advances from related parties. This was partially offset by a higher net repayment, and subsequent deconsolidation, of Simson-Maxwell's bank facility during the year.

The Company operates as one reportable segment. The Company's chief operating decision maker is the Chief Executive Officer, who reviews financial information presented on a consolidated basis. Performance is evaluated and resources allocated based upon the progress and projected financial requirements to advance each technology towards commercialization.

Summary information on our consolidated results for the years ended December 31, 2025 and 2024 is presented below.

		Years Ended December 31,
		2025				2024
Revenue		$	6,229,335			$	28,610,567
Operating expenses			14,176,204				39,793,711
Loss from operations			(7,946,869	)			(11,183,144	)
Other income (expense)			2,620,251				(59,076,750	)
Net loss before income taxes			(5,326,618	)			(70,259,894	)
Net loss		$	(5,326,618	)		$	(70,259,894	)

Revenue

The Company consolidated the revenues of Simon-Maxwell up to March 31, 2025, after which the Company deconsolidated Simson-Maxwell and began accounting for its investment in Simson-Maxwell at fair value. The Company did not generate revenues from any other sources in 2025. The significant decrease in revenues in 2025 as compared to the prior year reflects the impact of the deconsolidation of Simson-Maxwell effective April 1, 2025.

Operating expenses

The significant decrease in operating expenses in 2025 as compared to the prior year reflects the impact of the deconsolidation of Simson-Maxwell effective April 1, 2025, which reduced cost of goods sold, general and administrative expenses and depreciation expenses by approximately $16.0 million, $9.0 million and $0.5 million, respectively, as compared to the prior year.

25

Excluding Simson-Maxwell, operating expenses were relatively flat compared to the prior year. General and administrative expenses decreased by approximately $1.1 million, to $3.0 million, as compared to the prior year, driven by lower expenses for legal, insurance, consulting and public company-related costs. This was offset by an increase of $1.4 million in impairment expense related to intangible assets.

Loss from Operations

The loss from operations decreased by $3.2 million in 2025 as compared to the prior year. This reduction was due almost entirely to the deconsolidation of Simson-Maxwell. The operating loss from the rest of Camber's business was relatively flat compared to the prior period.

Other Income and Expense

The Company recorded other income of $2.6 million in 2025, driven primarily by the gain of $6.2 million recognized on the partial disposition of its investment in Simson-Maxwell, less interest expense and amortization of debt discount. In the prior year, the Company recorded other expense of ($59.1) million, consisting primarily of goodwill impairment of ($34.9) million and change in fair value of derivative liability of ($18.3) million, plus additional expenses for interest, amortization of debt discount, loss on extinguishment of debt and loss on disposal of oil and gas assets.

Net Loss

The Company's net loss of $5.3 million was approximately $65.0 million lower than the prior year, primarily as a result of the change in other income and expense described above.

Off Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity or capital expenditures or capital resources that is material to an investor in the Company's securities.

Seasonality

The Company's operating results are not affected by seasonality.

Inflation

The Company's business and operating results are not currently affected in any material way by inflation although they could be adversely affected in the future were inflation to increase, resulting in cost increases.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

We prepare our consolidated financial statements in conformity with U.S. GAAP, which requires management to make certain estimates and assumptions and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the consolidated financial statements are prepared and actual results could differ from our estimates and such differences could be material. Due to the need to make estimates about the effect of matters that are inherently uncertain, materially different amounts could be reported under different conditions or using different assumptions. On a regular basis, we review our critical accounting policies and how they are applied in the preparation of our consolidated financial statements, as well as the sufficiency of the disclosures pertaining to our accounting policies in the footnotes accompanying our consolidated financial statements. Described below are the most significant policies we apply in preparing our consolidated financial statements, some of which are subject to alternative treatments under GAAP. We also describe the most significant estimates and assumptions we make in applying these policies. See "Note 3 - Summary of Significant Accounting Policies" to our consolidated financial statements.

26

Consolidation of Variable Interest Entities

The Company consolidates the financial results of its subsidiaries, defined as entities in which the Company holds a controlling financial interest.

Several of the Company's subsidiaries are considered to be Variable Interest Entities ("VIE's") which are defined as an entity for which any of the following conditions exist:

1.	The total equity is not sufficient to permit the entity to finance its activities without additional subordinated financial support.
2.	The equity holders as a group have one of the following four characteristics:
	i.	Lack the power to direct activities that most significantly impact the entity's economic performance.
	ii.	Possess non-substantive voting rights.
	iii.	Lack the obligation to absorb the entity's expected losses.
	iv.	Lack the right to receive the entity expected residual returns.

The Company consolidates the financial results of a VIE when it is determined that the Company is the primary beneficiary of the VIE.

Intangible Assets

Intangible assets include the Company's investments in Viking Ozone, Viking Sentinel, Viking Protection and Viking Distribution, and the Company's license agreement with ESG. The license agreement was being amortized over 16 years. The other intangible assets have an indefinite life and are not being amortized.

The Company reviews these intangible assets, at least annually, for possible impairment when events or changes in circumstances that the assets carrying amount may not be recoverable. In evaluating the future benefit of its intangible assets, the Company estimates the anticipated discounted future net cash flows of the intangible assets over the remaining estimated useful life. If the carrying amount is not recoverable, an impairment loss is recorded for the excess of the carrying value of the asset over its fair value.

Investment in Unconsolidated Entity

The Company accounted for its non-controlling interest in Simson-Maxwell, an unconsolidated entity, under the equity method of accounting from April 1 through September 30, 2025. During the quarter ended December 31, 2025, the Company determined that it was not able to exercise significant influence over this investment and as a result, beginning with the quarter ended December 31, 2025, accounts for this investment at fair value. Under the fair value method, the Company adjusts the carrying value of its investment for changes in fair value and records the amount of the change in fair value in the consolidated statement of operations.

Revenue Recognition

Sale of Power Generation Units

The Company considers a completed unit to be a single performance obligation for purposes of revenue recognition and recognizes revenue when control of the product is transferred to the customer, which typically occurs upon shipment or delivery to the customer. Commissioning of the unit is considered to be a separate performance obligation for which revenue is recognized when the commissioning is completed. Progress payments are recognized as contract liabilities until the completed unit is delivered.

Parts Revenue

The Company considers the purchase orders for parts, which in some cases are governed by master sales agreements, to be the contracts with the customers. For each contract, the Company considers the commitment to transfer products, each of which is distinct, to be the identified performance obligations. Revenue is measured as the amount of consideration the Company expects to be entitled in exchange for the transfer of product, which is generally the price stated in the contract specific for each item sold, adjusted for the value of expected returns. Parts revenues are recognized at the point in time when control of the product is transferred to the customer, which typically occurs upon shipment or delivery to the customer.

Service and Repairs

Service and repairs are generally performed on customer owned equipment and billed based on labor hours incurred. Each repair is considered a performance obligation. As a result of control transferring over time, revenue is recognized based on the extent of progress towards completion of the performance obligation, generally using the cost-to-cost measure of progress for service work because the customer controls the asset as it is being serviced. Most service and repairs are completed in one or two days.