Note 5 – Investment in Equity Securities

At June 30, 2026 and December 31, 2025, the Company held an investment in the equity securities of Client A valued at $35.0 million, which is classified as a non-current asset on the accompanying unaudited condensed consolidated balance sheet. The investment was received as consideration for services rendered and represents a non-controlling equity interest in a privately held entity.

Client A

The Company estimated the fair value of the investment based on an anticipated public listing event by Client A expected to occur within the next twelve months. The estimated valuation is derived from pricing and valuation metrics provided by the issuer and underwriters in connection with the planned public listing event. This estimate is subject to significant judgment and market risk and is not based on observable inputs. In the event the public listing event valuation results in proceeds to the Company of less than $35.0 million for these shares of equity securities, Client A has contractually agreed to issue additional shares to the Company to ensure that the total value of the equity consideration received equals $35.0 million. The Company accounts for this investment under ASC 321, Investments – Equity Securities. Since the equity securities do not have a readily determinable fair value, the Company has elected the measurement alternative and, accordingly, it is carried at its estimated fair value calculated as its cost less any impairment charges until such time as there is evidence of an orderly transaction. As of June 30, 2026, no fair value adjustments have been recognized, nor have there been any impairment charges. This investment is considered a financial asset that is measured at fair value on a non-recurring basis.

Client B

The Company estimated the fair value of the equity consideration based on an anticipated public listing event by Client B. The estimated valuation is derived from pricing and valuation metrics provided by Client B in connection with the planned public listing event. This estimate is subject to significant judgment and market risk and is not based on observable inputs. Assuming the completion of all performance obligations, in the event the public listing event results in proceeds to the Company of less than $200.0 million for these shares of equity securities, Client B contractually agreed to either provide cash as fees or issue additional shares to the Company to ensure that the total value of the equity portion of the consideration received equals $200.0 million.