MTI Acquisition

On April 2, 2025 (the “MTI Acquisition Date”), the Company, through its indirect wholly-owned subsidiary Karman Parent LLC (“Karman Parent”), acquired all the issued and outstanding membership interests and other equity interests of MTI Metal Technology Inc. (“MTI”), pursuant to the terms of a Securities Purchase Agreement in exchange for cash consideration (the “MTI Acquisition”). The acquisition of MTI expands the Company’s capabilities in advanced materials and is expected to strengthen its position in the strategic missile defense market through enhanced product offerings and customer relationships.

The MTI Acquisition met the requirements to be considered a business combination under ASC 805. The assets and liabilities acquired, effected for adjustments to reflect fair values assigned to assets purchased and liabilities assumed, and results of operations, are included in the Company’s condensed consolidated financial statements from the MTI Acquisition Date. The Company recorded the acquired tangible and identifiable intangible assets and assumed liabilities based on their estimated fair values at the acquisition date as required under ASC 805.

The MTI Acquisition was funded with borrowings under the Company’s Credit Agreement and was accounted for using the acquisition method of accounting. The fair value of the total purchase consideration transferred was $82.3 million. The MTI Acquisition does not have any contingent consideration arrangements.

The Company also incurred $1.4 million of direct acquisition-related expenses, recognized as general and administrative expenses on the condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2025. No acquisition-related expenses were recorded for the three and nine months ended September 30, 2026.

The accounting for the MTI Acquisition was completed during the quarter ended March 31, 2026. The following table sets forth the allocation of the fair value of the assets acquired and liabilities assumed in connection with the MTI Acquisition. No material adjustments were recognized during the measurement period.

The excess of the purchase price over the fair value of the net identifiable tangible and intangible assets was recorded as goodwill and is fully deductible for tax purposes. The components of goodwill do not qualify as a separately recognized intangible asset.

The fair value of know-how was determined using the relief-from-royalty method, and the fair values of customer relationships and backlog were determined using the multi-period excess earnings method (“MPEEM”). In total, the intangible assets acquired subject to amortization have a weighted average useful life of 11.0 years.

Supplemental pro forma results of operations are not presented because they are not material to the condensed consolidated results of operations.

ISP Acquisition

On May 28, 2025 (the “ISP Acquisition Date”), the Company completed its acquisition of Industrial Solid Propulsion (“ISP”) pursuant to a Securities Purchase Agreement (the “ISP Agreement”), under which the Company purchased all issued and outstanding equity interests in ISP and related real estate of ISP, for approximately $50 million in cash, 147,842 shares of common stock of the Company and a $5.0 million potential earnout (the “Earnout”), subject to satisfaction or waiver of certain customary closing adjustments. The ISP Agreement contains customary representations, warranties and covenants of the parties. The acquisition of ISP expands the Company’s capabilities in small-diameter solid propellant and energetic propulsion systems, strengthening its position in the UAS and missile defense markets through proprietary technologies and integrated manufacturing expertise.

The ISP Acquisition met the requirements to be considered a business combination under ASC 805. The assets and liabilities acquired, effected for adjustments to reflect fair values assigned to assets purchased and liabilities assumed, and results of operations, are included in the Company’s condensed consolidated financial statements from the ISP Acquisition Date. The Company recorded the acquired tangible and identifiable intangible assets and assumed liabilities based on their estimated fair values at the acquisition date as required under ASC 805.

The ISP Acquisition was funded with incremental borrowings under the Company’s Credit Agreement and was accounted for using the acquisition method of accounting. The fair value of the total purchase consideration transferred was $58.6 million, of which $49.0 million represents cash consideration, $5.7 million represents the fair value of the equity consideration as of the ISP Acquisition Date and $3.9 million represents the fair value of the Earnout, which was recorded in other current liabilities on the condensed consolidated balance sheets. The earnout liability was estimated using a Monte Carlo simulation under a risk-neutral framework, based on the average present value of the simulated earnout payments. The Earnout provides for a cash payment equal to $5.0 million to the seller of ISP, contingent upon the achievement of a specified Adjusted EBITDA threshold for the twelve months ended December 31, 2025, as defined in the ISP Agreement. As of December 31, 2025, the Company determined that the Adjusted EBITDA target was not achieved and therefore will not be paid. Accordingly, the Earnout no longer had any value, and the related contingent consideration liability was reduced to zero as of December 31, 2025, with the change in fair value recognized as other income on the consolidated statements of operations and comprehensive income.

The Company also incurred $1.2 million of direct acquisition-related expenses, recognized as general and administrative expenses on the condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2025. No acquisition-related expenses were recorded for the three or nine months ended September 30, 2026.

The excess of the purchase price over the fair value of the net identifiable tangible and intangible assets was recorded as goodwill and is fully deductible for tax purposes. The components of goodwill do not qualify as a separately recognized intangible asset.

The fair value of know-how was determined using the relief-from-royalty method, and the fair values of customer relationships and backlog were determined using the MPEEM. In total, the intangible assets acquired subject to amortization have a weighted average useful life of 10.7 years.

Supplemental pro forma results of operations are not presented because they are not material to the condensed consolidated results of operations.

Five Axis Acquisition

On October 28, 2025 (the “Five Axis Acquisition Date”), the Company, through its wholly owned subsidiary, Karman Space & Defense LLC, completed the acquisition of all of the issued and outstanding capital stock of Five Axis Industries, Inc. (“Five Axis”) pursuant to a Securities Purchase Agreement, under which the Company purchased all issued and outstanding equity interests in Five Axis, for approximately $90.7 million in cash and 68,625 shares of common stock (the “Five Axis Acquisition”). Five Axis designs and manufactures specialized nozzle and fuel systems for launch vehicle engines. Its products support the performance and operation of both current and next-generation propulsion systems. The acquisition of Five Axis strengthens the Company’s core competency in the engineering and manufacturing of mission-critical subsystems for the space and launch end market.

The Five Axis Acquisition met the requirements to be accounted for as a business combination under ASC 805. Five Axis’ assets and liabilities have been adjusted for preliminary estimates of fair value, and its results of operations have been included in the Company’s condensed consolidated financial statements from the Five Axis Acquisition Date. The purchase price was allocated to tangible and identifiable intangible assets based on their estimated fair values at the Five Axis Acquisition Date.

The Five Axis Acquisition was funded with incremental borrowings under the Company’s Credit Agreement and was accounted for using the acquisition method of accounting. The Five Axis Acquisition does not have any contingent consideration arrangements.

Acquisition-related costs have been expensed as incurred and are included in general and administrative expenses in the condensed consolidated statements of operations and comprehensive income. No acquisition-related expenses were recorded for the three or nine months ended September 30, 2026 or 2025.

The excess of the purchase price over the fair value of the net identifiable tangible and intangible assets was recorded as goodwill, which is not deductible for tax purposes. Goodwill reflects expected synergies from the combined operations, specialized processes and procedures, and the assembled workforce. The components of goodwill do not qualify as a separately recognized intangible asset.

The fair values of customer relationships and backlog were determined using the MPEEM. In total, the intangible assets acquired subject to amortization have a weighted average useful life of 13.0 years.

Supplemental pro forma results of operations are not presented because they are not material to the condensed consolidated statements of operations and comprehensive income.

Seemann Acquisition

On February 3, 2026 (the “Seemann Acquisition Date”), the Company, through a wholly owned subsidiary, completed the acquisition of all of the issued and outstanding membership interests of Seemann Composites, LLC and Materials Sciences LLC (together, “Seemann”) pursuant to a Securities Purchase Agreement dated December 31, 2025 (the “Seemann Acquisition”), for approximately (i) $215.9 million in cash and (ii) shares of common stock of the Company with an aggregate value equal to $17.0 million, of which $1.7 million was withheld to cover Seemann’s income tax liability. Seemann provides advanced composite systems and materials solutions for maritime defense applications. The Company believes the acquisition of Seemann expands its capabilities in the maritime defense end market and strengthens its portfolio supporting high-priority, funded U.S. Navy programs.

The Seemann Acquisition met the requirements to be accounted for as a business combination under ASC 805. Seemann’s assets and liabilities have been adjusted for preliminary estimates of fair value, and its results of operations have been included in the Company’s condensed consolidated financial statements from the Seemann Acquisition Date. The purchase price was allocated to tangible and identifiable intangible assets based on their estimated fair values at the Seemann Acquisition Date.

The Seemann Acquisition was accounted for using the acquisition method of accounting. The Seemann Acquisition was funded with incremental borrowings under the Company’s Credit Agreement. The total consideration transferred was $232.9 million. The Seemann Acquisition does not have any contingent consideration arrangements.

The Company incurred $4.0 million of direct acquisition-related expenses, of which $2.0 million was recognized in the prior year and the remaining $2.0 million was recognized as general and administrative expenses on the condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2026.

As the Company finalizes the estimation of the fair value of the assets acquired and liabilities assumed, additional adjustments may be recorded during the measurement period (a period not to exceed 12 months from the Seemann Acquisition Date). The following table reflects the preliminary acquisition date fair value of the assets acquired and liabilities assumed in connection with the Seemann Acquisition:

The excess of the purchase price over the fair value of the net identifiable tangible and intangible assets was recorded as goodwill and is fully deductible for tax purposes. Goodwill reflects expected synergies from the combined operations, specialized processes and procedures, and the assembled workforce. The components of goodwill do not qualify as a separately recognized intangible asset. Goodwill is allocated to the Company’s single reporting segment.

The fair values of trade names and know-how were determined using the relief-from-royalty method, and the fair values of the customer contracts and backlog were determined using the MPEEM. All intangible assets are subject to amortization. In total, the intangible assets acquired subject to amortization have a weighted average useful life of 7.3 years.

Revenue attributable to the Seemann Acquisition and included in the Company’s condensed consolidated financial statements was $39.5 million and $102.5 million for the three and nine months ended September 30, 2026, respectively. Supplemental pro forma information is not presented, as it is impracticable to obtain the information due to the lack of availability of historical GAAP financial data.

Walker Acquisition

On August 28, 2026 (the “Walker Acquisition Date”), the Company, through its wholly owned subsidiary, Karman Space & Defense LLC, completed the acquisition of all of the issued share capital of Walker Precision Holdings Limited (“Walker”) pursuant to the Share Purchase Agreement dated July 18, 2026 (the “Walker Acquisition”). Walker is a precision manufacturing and engineering company that produces complex machined components, assemblies, and related engineering solutions primarily for the aerospace and defense sectors. The Company believes the acquisition of Walker expands its capabilities in missile and air defense applications and establishes its international presence in Europe.

The Walker Acquisition met the requirements to be accounted for as a business combination under ASC 805. Walker’s assets and liabilities have been adjusted for preliminary estimates of fair value, and its results of operations have been included in the Company’s consolidated financial statements from the Walker Acquisition Date. The purchase price was allocated to tangible and identifiable intangible assets based on their estimated fair values at the Walker Acquisition Date.

The Walker Acquisition was accounted for using the acquisition method of accounting. The acquisition was funded with incremental borrowings under the Company’s Credit Agreement. The total consideration transferred was $99.0 million and paid in cash.

The Company also incurred $2.4 million of direct acquisition-related expenses, recognized as general and administrative expenses on the condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2026.

As of September 30, 2026, the Company had not finalized the determination of fair value of certain tangible and intangible assets acquired and liabilities assumed and goodwill. As such, the assessment of fair value of assets acquired and liabilities assumed is preliminary and was based on information that was available at the time the condensed consolidated financial statements were prepared. The finalization of the purchase accounting assessment could result in material changes in the Company’s determination of the fair value of assets acquired and liabilities assumed, which will be recorded as measurement period adjustments in the period in which they are identified, up to 12 months from the Walker Acquisition Date. The following table sets forth the preliminary acquisition date fair value of the assets acquired and liabilities assumed in connection with the Walker Acquisition:

The excess of the purchase price over the fair value of the net identifiable tangible and intangible assets was recorded as goodwill, which is not expected to be deductible for tax purposes. Goodwill reflects expected synergies from the combined operations, specialized processes and procedures, and the assembled workforce. The components of goodwill do not qualify as a separately recognized intangible asset. Goodwill is allocated to the Company’s single reporting segment.

The fair value of know-how was determined using the relief-from-royalty method, and the fair value of customer relationships and backlog were determined using the MPEEM. All intangible assets are subject to amortization. In total, the intangible assets acquired subject to amortization have a weighted average useful life of 15.1 years.

Revenue attributable to the Walker Acquisition and included in the Company’s condensed consolidated financial statements was $4.0 million for each of the three and nine months ended September 30, 2026.