Company: VGASW
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001628280-25-040155
Chunk: 32

Company: Verde Clean Fuels, Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 1
Chunk 32
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 liability- 978,412 Other accrued expenses20,524 61,710 Total accrued liabilities$751,223 $1,907,165 Inflation Reduction Act of 2022On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other things, a new U.S. federal 1% excise tax on certain repurchases of stock occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not its stockholders from which shares are repurchased. The amount of the excise tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. The amount of repurchases applicable to the excise tax can be reduced by the fair market value of any 

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issuances at the time of issuance that occurred during the year, as well as certain exceptions provided by the U.S. Department of the Treasury.As of December 31, 2024, the Company had recorded an accrual for an excise tax liability of $978,412. During the six months ended June 30, 2025, the accrued excise tax liability was paid in full.

NOTE 6 – RELATED PARTY TRANSACTIONS

HoldingsThe Company has a related party relationship with Holdings whereby Holdings holds a majority ownership in the Company via voting shares and has control of its Board of Directors. Further, Holdings possesses 3,500,000 earn out shares. The Holdings equity compensation instruments consist of 1,000 authorized and issuable Series A Incentive Units (the “Series A Incentive Units”) and 1,000 authorized and issuable Founder Incentive Units (the “Founder Incentive Units”). Certain of the Company's management hold Series A Incentive Units and Founder Incentive Units that entitle them to participate in the earnings of and distributions by Holdings after a specified return to the Series A Preferred Unit holders. See Notes 1, 8 and 10 for further information.CottonmouthThe Company has a related party relationship with Cottonmouth due to its ownership interest in the Company's Class A common stock. See Notes 1 and 3 for further information.ChemexIn June 2024, the Company entered into a contract with Chemex, a Shaw Group company, for a FEED study related to the Permian Basin