Company: VGASW
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001628280-25-040155
Chunk: 34

Company: Verde Clean Fuels, Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 1
Chunk 34
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 obtained in exchange for operating lease$308,623 $353,162 Remaining lease term – operating leases1.1 years1.5 yearsDiscount rate – operating leases7.50%7.50%CommitmentsThe Company had a restricted cash balance of $100,000 as of June 30, 2025 and December 31, 2024. The restricted cash balance is maintained in support of a letter of credit.ContingenciesThe Company is not party to any litigation.

NOTE 8 – STOCKHOLDERS’ EQUITY

Earn Out ConsiderationEarn out shares potentially issuable as part of the Business Combination are recorded within stockholders' equity as the instruments are deemed to be indexed to the Company’s common stock and meet the equity classification criteria under ASC 815. Earn out shares contain market conditions for vesting and were awarded to eligible stockholders, as described further below, and not to current employees.As consideration for the contribution of the equity interests in Intermediate, Holdings received earn out consideration (“Holdings earn out”) of 3,500,000 shares of Class C common stock and a corresponding number of Class C OpCo Units subject to vesting with the achievement of separate market conditions. One half of the Holdings earn out shares will meet the market condition when the volume-weighted average share price (“VWAP”) of the Class A common stock is greater than or equal to $15.00 for any 20 trading days within any period of 30 consecutive trading days within five years of the Closing Date. The second half will vest when the VWAP of the Class A common stock is greater than or equal to $18.00 over the same measurement period.Additionally, the Sponsor received earn out consideration (“Sponsor earn out” and, together with Holdings earn out, the “Earn Out Equity”) of 3,234,375 shares of Class A common stock subject to forfeiture which will no longer be subject to forfeiture with the achievement of separate market conditions (the “Sponsor Shares”). One half of the Sponsor earn out will no longer be subject to forfeiture if the VWAP of Class A common stock is greater than or equal to $15.00 for any 20 trading days within any period of 30 consecutive trading days within five years of the Closing Date. The second half will no longer be subject to forfeiture when the VWAP of the Class A common stock is greater than or equal to $18.00 over the same measurement period.

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Notwithstanding the foregoing, the shares of Earn Out