Company: NOEMW
Filing Date: 2025-08-12
Form Type: 10-Q
Source: 0001213900-25-075048
Chunk: 16

Company: CO2 Energy Transition Corp.
Filing Date: 2025-08-12
Form: 10-Q
Item: Part I, Item 1
Chunk 16
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 benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by
taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim period,
disclosure and transition.

The Company’s effective
tax rate was 25.94% and 26.19%, 0.00% and 0.00% for the three and six months ended June 30, 2025, and 2024, respectively. The
effective tax rate differs from the statutory tax rate of 21% due to the valuation allowance on the deferred tax assets.

The Company recognizes accrued
interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts
accrued for interest and penalties as of June 30, 2025 and December 31, 2024. The Company is currently not aware of any issues under review
that could result in significant payments, accruals or material deviation from its position.

The Company has identified
the United States as its only “major” tax jurisdiction. The Company may be subject to potential examination by federal and
state taxing authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions,
the nexus of income among various tax jurisdictions and compliance with federal and state tax laws. The Company’s management does
not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

Net Income (Loss) per Common Stock Share

The Company complies with
accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share.” The Company has two classes of shares,
which are referred to as redeemable common stock and non-redeemable common stock. Income and losses are shared pro rata between the two
classes of shares. Net income (loss) per common share is calculated by dividing the net income (loss) by the weighted average shares of
common stock outstanding for the respective period.

The calculation of diluted
net income (loss) does not consider the effect of the warrants underlying the Units sold in the Initial Public Offering (including the
consummation of the Over-allotment) and the private placement warrants to purchase an aggregate of 7,165,000 shares of common stock in
the calculation of diluted income (loss) per share, because their exercise is contingent upon future events. As a result, diluted net
income (loss)