Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2026

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting and the rules and regulations of the Securities and Exchange Commission (“SEC”). References to ASC and ASU included herein refer to the Accounting Standards Codification and Accounting Standards Update established by the Financial Accounting Standards Board (“FASB”) as the source of authoritative GAAP. All costs, as well as assets and liabilities directly associated with the Company’s business activity, are included in the condensed consolidated financial statements. In connection with the Business Combination, as the successor entity following the Closing, Hadron became the reporting entity and consolidates the balances and activity of Private Hadron. The financial information presented in these unaudited condensed consolidated financial statements reflects the balances and results of operations of the combined entity post-Merger.

Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position as of June 30,

2026, operating results and cash flows for the periods presented. The results for the three and six months ended June 30, 2026 are not necessarily indicative of the results expected for the year or any other periods. The condensed consolidated balance sheets as of December 31, 2025 have been derived from the audited annual financial statements of Private Hadron included in the Prospectus filed with the SEC on June 25, 2026. All intercompany balances and transactions have been eliminated in consolidation.

Use of Accounting Estimates

The preparation of interim condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions. The Company believes that the estimates, judgments and assumptions made when accounting for items and matters such as, but not limited to, valuation of warrant liabilities, stock-based compensation and loss contingencies including estimated legal settlement, are reasonable based on information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the interim condensed consolidated financial statements, as well as amounts reported on the unaudited condensed consolidated statements of operations and comprehensive income (loss) during the periods presented. These estimates and assumptions may change as new events occur, and additional information is obtained. As a result, actual results could differ materially from these estimates and assumptions.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the Federal Deposit Insurance Corporation coverage limit of $250,000. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial condition, results of operations, and cash flows.

Emerging Growth Company

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when an accounting standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised accounting standard at the time private companies adopt the new or revised standard.

Property and Equipment, Net

All additions are recorded at cost. Maintenance and repairs are charged to expense as incurred. When assets are retired or otherwise disposed of, the cost of the assets and the related accumulated depreciation is derecognized with any gain or loss recorded in the year of disposition. Depreciation is based on the estimated useful lives of the assets using the straight-line method. Furniture is depreciated over useful lives of three to seven years, and computer equipment is depreciated over three years.

Deferred Transaction Costs

The Company capitalized deferred transaction costs, which primarily consist of incremental legal fees, accounting fees and other fees directly attributable to the Business Combination which was accounted for as a reverse recapitalization. Reverse recapitalization transactions are viewed as the issuance of equity by the accounting acquirer for the cash of the SPAC. Accordingly, the direct and incremental transaction costs related to the de-SPAC transaction are treated as a reduction of the SPAC’s cash proceeds and deducted from additional paid-in capital. The deferred transaction costs in the amount of $2,484 were reclassified to additional paid-in capital upon Closing. As of June 30, 2026 and December 31, 2025, deferred transaction costs of $0 and $1,875, respectively, were capitalized in connection with the Business Combination on the condensed consolidated balance sheets.

Fair Value of Financial Instruments

The Company measures certain financial assets and liabilities at fair value. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the Company uses a three-level hierarchy, which prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach and cost approach). The levels of hierarchy are described below:

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Level 1 – Quoted prices in active markets for identical instruments.

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Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

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Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Financial assets and liabilities are classified in their entirety based on the most stringent level of input that is significant to the fair value measurement. The carrying amount of certain financial instruments, including prepaid expenses and other current assets, other assets, deferred transaction costs, accounts payable, and accrued expenses approximate their fair value due to their short maturities. The fair value of the Company’s Simple Agreements for Future Equity agreements ("SAFEs") liability and legal settlement were determined using Level 3 fair value determination methods. Refer to Note 6.

The Company has determined that the private placement warrants (the "Private Placement Warrants") are subject to treatment as a liability. Accordingly, the Private Placement Warrants are valued upon observable data and are classified as Level 2 financial instruments and its fair value was estimated using a Black-Scholes-Merton model.

The Company has also determined that the Hadron private warrants (the "Hadron Private Warrants") are subject to treatment as a liability. Accordingly, the Hadron Private Warrants are classified as a Level 3 financial instrument and its fair value was estimated using a Monte Carlo simulation model.

The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:


Description:	Level	Valuation Methodology	June 30, 2026
Private placement warrants	2	Black-Scholes-Merton Model	$	636
Hadron private warrants	3	Monte Carlo Simulation	$	1,515

The fair value of the Private Placement Warrants was estimated using the following assumptions:


	June 30, 2026
Stock Price	$	2.03
Volatility		50.50	%
Risk free interest rate		4.14	%
Exercise price	$	11.50
Time to maturity - years		4.89

The fair value of the Hadron Private Warrants was estimated using the following assumptions:


	June 30, 2026
Stock Price	$	2.03
Risk free interest rate		4.14	%
Exercise price	$	12.00
Short term volatility (through reset date)		104.0	%
Implied Remaining Term Volatility (reset date through termination)		26.7	%
Time to exercise price reset - years		0.89
Time to maturity - years		4.89

The following table presents a reconciliation of the Warrant liabilities, measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended June 30, 2026:


	Private Hadron Warrants
Balance at December 31, 2025	$	-
Warrant liabilities issued in connection with Business Combination		6,000
Change in fair value during the period		(4,485	)
Balance at June 30, 2026	$	1,515

Leases

The Company determines if an arrangement is a lease at inception by evaluating whether the arrangement conveys the right-of-use (“ROU”) to an identified asset and whether the Company obtains substantially all of the economic benefits from and has the ability to direct the use of the asset. Leases are recorded as an operating lease right-of-use assets and operating lease liabilities on the balance sheets. Leases with an initial term of 12 months or less are not recorded on the balance sheets. Lease ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the expected lease term, including options to extend the lease when it is reasonably certain that the Company will exercise that option. The Company uses the discount rate implicit in the lease unless that rate cannot be readily determined. In that case, the Company uses its estimated incremental borrowing rate, which is the rate of interest that the Company would have to pay to borrow on a collateralized basis an amount equal to the lease payments over the expected lease term. Operating lease expense for lease payments is recognized on a straight-line basis over the expected lease term. There were no finance leases or operating leases as of June 30, 2026, and the only remaining lease as of June 30, 2026 is a short term lease.

Simple Agreements for Future Equity

The Company accounts for its SAFEs as a liability stated at fair value. SAFEs are subject to revaluation at the end of each reporting period, with changes in fair value recognized in the condensed consolidated statements of operations and comprehensive income (loss). In connection with the Business Combination, all outstanding SAFEs were converted into common stock of the Company at Closing. Refer to Note 6 for additional details.

General and Administrative

General and administrative (“G&A”) expenses consist primarily of personnel-related expenses for executives, human resources, finance and other G&A employees, including salary, professional services costs and facility and overhead costs.

Research and Development

Research and development (“R&D”) expenses represent costs incurred for technology development and regulatory support for the development of the factory manufactured light-water micro modular reactor. The R&D expenses consist of: employee-related expenses, including salaries, benefits, payroll taxes, travel, for personnel in R&D functions; expenses related to technology development; and facilities, overhead, and other expenses. All research and development costs related to product development are expensed as incurred.

Stock-Based Compensation

Stock-based compensation is measured using a fair value-based method for all equity-based awards. The cost of awarded equity instruments is recognized based on each instrument’s grant-date fair value over the period during which the award vests. The Company recognizes stock-based compensation expense for awards ratably over the requisite service period. For awards subject to time-based vesting conditions, the service period is generally the vesting period.

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets, including tax loss and credit carry forwards, and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded when it is “more likely-than-not” that deferred tax assets will not be realized. On a regular basis, the Company evaluates the recoverability of deferred tax assets and the need for a valuation allowance. Such evaluations involve the application of significant judgment. The Company considers multiple factors in its evaluation of the need for a valuation allowance. The Company’s net deferred tax assets consist of assets related to net operating losses.

Until an appropriate level of profitability is attained, the Company expects to maintain a full valuation allowance on its deferred tax assets. Any tax benefits or tax expense recorded on its statements of operations will be offset with a corresponding valuation allowance until such time that the Company changes its determination related to the realization of deferred tax assets. In the event that the Company changes its determination as to the amount of deferred tax assets that can be realized, the Company will adjust its valuation allowance with a corresponding impact to the provision for income taxes in the period in which such a determination is made. For uncertain tax positions that meet a “more likely-than-not” threshold, the Company recognizes the benefit of uncertain tax positions in the financial statements.

The Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the accompanying statements of operations and comprehensive income (loss). The prior year tax returns remain subject to examination by taxing jurisdictions. At June 30, 2026 and December 31, 2025, the Company does not believe it has any uncertain tax positions that would require either recognition or disclosure in the accompanying financial statements.

Net Income (Loss) Per Share

The Company’s basic net income (loss) per share of common stock is computed based upon the weighted average number of shares of common stock outstanding for the period. Diluted loss per share includes the effect, if any, from potential conversion of securities, such as the issuance of shares of common stock from SAFE notes. Participating securities (unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents) are included in the computation of net income (loss) per share, pursuant to the two-class method. The Company’s participating securities consist of unvested restricted stock awards, which have contractual participation rights equivalent to those of stockholders of unrestricted common stock. The two-class method of computing earnings per share is an allocation method that calculates earnings per share for common stock and participating securities. During periods of net loss, no effect is given to the participating securities because they do not share in the losses of the Company. For any period in which the Company is in a net loss position, basic net loss per share is the same as diluted net loss per share, since the effects of potentially dilutive securities are antidilutive.

The following table sets forth the computation of basic and diluted net income (loss) per common share:


	Three months ended June 30,						Six months ended June 30,
	2026			2025			2026			2025
Numerator:
Net income (loss)	$	17,558		$	(6,762	)	$	30,926		$	(6,982	)
Undistributed earnings allocated to participating securities		(659	)		-			(917	)		-
Net income (loss) - basic	$	16,899		$	(6,762	)	$	30,009		$	(6,982	)
Net income (loss)	$	17,558		$	(6,762	)	$	30,926		$	(6,982	)
Change in fair value of Simple Agreements for Future Equity		(18,427	)		-			(31,846	)		-
Undistributed earnings allocated to participating securities		(659	)		-			(917	)		-
Net loss - diluted	$	(1,528	)	$	(6,762	)	$	(1,837	)	$	(6,982	)
Denominator:
Denominator for basic net income (loss) per share – common shares outstanding		56,967,986			45,684,836			51,552,343			45,349,227
Effect of dilutive securities:
Expected shares from SAFEs		1,934,071			-			2,688,340			-
Denominator for diluted net loss per share – common shares outstanding		58,902,057			45,684,836			54,240,683			45,349,227
Net income (loss) per share – basic	$	0.30		$	(0.15	)	$	0.58		$	(0.15	)
Net loss per share - diluted	$	(0.03	)	$	(0.15	)	$	(0.03	)	$	(0.15	)

The following outstanding potentially dilutive shares have been excluded from the calculation of diluted net income (loss) per share for the periods presented because including them would have been antidilutive (in common stock equivalent shares):


	June 30, 2026		June 30, 2025
Unvested shares of restricted stock purchase agreements		1,278,824		838,524
Expected shares from SAFE notes		-		1,874,278
Warrants		28,719,000		-
Total potentially dilutive securities		29,997,824		2,712,802

Segment Information

The Company has determined that its Chief Executive Officer (“CEO”), is its chief operating decision maker (“CODM”). The CODM reviews financial information presented for purposes of assessing performance and making decisions on how to allocate resources at the overall Company level. The Company views its operations and manages its business as a single reportable segment with a single

operating segment. During the six months ended June 30, 2026 and 2025, the CODM made decisions on resource allocation, assessed performance of the business and monitored actual results using net income (loss), which is provided in the accompanying condensed consolidated statements of operations and comprehensive income (loss). When evaluating how to allocate resources, the CODM primarily focuses on the financial results of the Company on the same level as the Company's condensed consolidated statements of operations and comprehensive income (loss).

Recent Accounting Pronouncements

The Company considers the applicability and impact of all ASUs issued by the FASB. The Company reviewed all recently issued accounting pronouncements, and based on its preliminary assessment, the Company has determined that these will not have a material impact on the Company’s unaudited condensed consolidated financial statements or related disclosures, or do not apply to the Company.