v3.26.1
Related Party Transactions
 3 Months Ended
Mar. 31, 2026
Related Party Transactions [Abstract]  
Related Party Transactions
NOTE 12 — Related Party Transactions
The following table summarizes the related party transactions included in the condensed consolidated statements of operations and comprehensive loss:
Three Months Ended March 31,
$ in thousands20262025
Master services agreement administrative costs$28 $27 
General and administrative$28 $27 
Master services agreement costs for the La Porte Demonstration Facility$248 $708 
BHES JDA
13,007 17,827 
Research and development$13,255 $18,535 
BHES Limited Notice to Proceed$— $22,007 
Project development$— $22,007 
The Company had $7.1 million and $37.3 million in current liabilities payable to related parties as of March 31, 2026 and December 31, 2025, respectively, on the condensed consolidated balance sheets related to the following services. These related party payables are unsecured and are due on demand.
Master Services Agreements
A significant shareholder provides the Company with patent administration services related to the development of the Oxy-Combustion Cycle technology. These totals are included in General and administrative on the condensed consolidated statements of operations and comprehensive loss.
Another shareholder supports the Company with regard to general business oversight and with the operation of the La Porte Demonstration Facility. These totals are reflected in Research and development on the condensed consolidated statements of operations and comprehensive loss.
BHES JDA
On February 3, 2022, the Company entered into the Original JDA, which was subsequently amended and restated on June 30, 2022 and December 13, 2022 with BHES to invest in, develop, and deploy the Oxy-Combustion Cycle technology in collaboration with the Company (as amended and restated, the “BHES JDA”). The BHES JDA is settled in cash and issuances of equity in exchange for services related to the development and commercialization of the Oxy-Combustion Cycle technology. The Company records the expense for services provided by BHES within Research and development on the condensed consolidated statements of operations and comprehensive loss.
In January 2026, the Company agreed to suspend development activities under the BHES JDA from the December 31, 2025 effective date through March 31, 2026 (the “BHES JDA Suspension Agreement”). Subsequently in March 2026, BHES requested a 60-day extension of the BHES JDA Suspension Agreement while it continues to evaluate the proposed development and commercialization of industrial-scale Oxy-Combustion Cycle technology. In April 2026, the Company agreed to extend the BHES JDA Suspension Agreement through May 30, 2026 (the “BHES JDA Variation Agreement No. 1”). During the suspension period, the Company and BHES will engage in negotiations regarding potential amendments to the BHES JDA. Under the terms of the BHES JDA Suspension Agreement, the Company is obligated to pay BHES any invoiced costs incurred in the fourth quarter of 2025 and any costs resulting or arising from the suspension, up to a $3.0 million cap.
The portion of BHES JDA costs that the Company pays with Class A OpCo Units and shares of Class B Common Stock is recorded within Additional paid-in capital on the condensed consolidated balance sheets and the condensed consolidated statement of shareholders' equity and mezzanine shareholders' equity. The following table displays the expense recognized in the consolidated statement of comprehensive income for shares distributed as payment for services rendered under the terms of the BHES JDA during the periods described below:
QuantityExpense Recognized
Three Months Ended March 31,Three Months Ended March 31,
in thousands2026202520262025
Class A OpCo Units9091,248$6,011 $8,247 
Class B Common Stock9091,248— — 
Total$6,011 $8,247 
Shares issued as payment under the terms of the BHES JDA are issued at a discount expected to cause a total loss of approximately $17.5 million to the Company over the term of the agreement. The Company has incurred inception-to-date losses of $16.2 million related to such issuances.
During the three months ended March 31, 2026, the Company incurred $9.6 million related to reimbursement of costs incurred by BHES to terminate certain third-party supplier and subcontractor purchase orders entered into by BHES in furtherance of the BHES JDA scope.
If the volume-weighted average price of the Company’s stock for ten consecutive trading days (“10-Day VWAP”) immediately preceding the payment date for services under the BHES JDA is less than $4.00 per share (the “Floor Price”), an incremental cash payment is required for the difference between the 10-Day VWAP and the Floor Price (the “BHES JDA Make-Whole Payment”). As of March 31, 2026 and December 31, 2025, the Company had $2.2 million and $2.8 million in current liabilities payable to related parties on the condensed consolidated balance sheets related to the BHES JDA Make-Whole Payment. For the three months ended March 31, 2026 and 2025, the Company incurred $2.2 million and $2.5 million, respectively, related to the BHES JDA Make-Whole Payment.