# EDGAR Filing Document

**Accession Number:** 0001843714
**File Stem:** 0001079973-25-001837
**Filing Date:** 2025-12
**Character Count:** 150203
**Document Hash:** 3f0ee7d1effad293344a8e3adbb188a9
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001079973-25-001837.hdr.sgml**: 20251209

**ACCESSION NUMBER**: 0001079973-25-001837

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 86

**CONFORMED PERIOD OF REPORT**: 20250331

**FILED AS OF DATE**: 20251209

**DATE AS OF CHANGE**: 20251209

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Zapata Quantum, Inc.
- **CENTRAL INDEX KEY:** 0001843714
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-PREPACKAGED SOFTWARE [7372]
- **ORGANIZATION NAME:** 06 Technology
- **EIN:** 981578373
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41218
- **FILM NUMBER:** 251559751

**BUSINESS ADDRESS:**
- **STREET 1:** 6 LIBERTY SQUARE
- **STREET 2:** #2488
- **CITY:** BOSTON
- **STATE:** MA
- **ZIP:** 02109
- **BUSINESS PHONE:** 857-367-9002

**MAIL ADDRESS:**
- **STREET 1:** 6 LIBERTY SQUARE
- **STREET 2:** #2488
- **CITY:** BOSTON
- **STATE:** MA
- **ZIP:** 02109

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Zapata Computing Holdings Inc.
- **DATE OF NAME CHANGE:** 20240328

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Andretti Acquisition Corp.
- **DATE OF NAME CHANGE:** 20210201

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q** 

**☒** **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the quarterly period ended **March 31, 2025**

Or

**☐** **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the transition period from ___________ to ___________

Commission file number: **000-41218**

---

| |
|:---|
| **Zapata Quantum, Inc.** |
| *(Exact name of registrant as specified in charter)* |

---

---

| | |
|:---|:---|
| **Delaware** | **98-1578373** |
| *(State or other jurisdiction of*<br> *incorporation or organization)* | *(I.R.S. Employer*<br> *Identification No.)* |
| **6 Liberty Square, #2488**<br> **Boston, MA** | **02109** |
| *(Address of principal executive offices)* | *(Zip Code)* |

---

---

| |
|:---|
| **(857) 367-9002** |
| *(Registrant's telephone number, including area code)* |

---

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by checkmark whether the registrant has (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standard provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No☒

As of November 30, 2025, the issuer had 162,580,506 shares of its common stock, $0.0001 par value per share, outstanding.

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  |  | **Page** |
|  | **PART I - Financial Information** |  |
| Item 1 | [Financial Statements](#a_001) | 1 |
|  | [Condensed Consolidated Balance Sheets – As of March 31, 2025 (Unaudited) and December 31, 2024](#a_002) | 1 |
|  | [Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) – For the Three Months Ended March 31, 2025 and 2024](#a_003) | 2 |
|  | [Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders' Deficit (Unaudited) – For the Three Months Ended March 31, 2025 and 2024](#a_004) | 3 |
|  | [Condensed Consolidated Statements of Cash Flows (Unaudited) – For the Three Months Ended March 31, 2025 and 2024](#a_005) | 4 |
|  | [Notes to Condensed Consolidated Financial Statements (Unaudited)](#a_006) | 5 |
| Item 2 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_007) | 21 |
| Item 3 | [Quantitative and Qualitative Disclosures About Market Risk](#a_008) | 29 |
| Item 4 | [Controls and Procedures](#a_009) | 29 |
|  | **Part II - Other Information** |  |
| Item 1 | [Legal Proceedings](#a_010) | 31 |
| Item 1A | [Risk Factors](#a_0111) | 31 |
| Item 2 | [Unregistered Sales of Equity Securities and Use of Proceeds](#a_011) | 31 |
| Item 3 | [Defaults Upon Senior Securities](#a_012) | 31 |
| Item 4 | [Mine Safety Disclosures](#a_013) | 31 |
| Item 5 | [Other Information](#a_014) | 31 |
| Item 6 | [Exhibits](#a_015) | 31 |
| [Signatures](#a_016) | [Signatures](#a_016) | 32 |

---

i

**PART I—FINANCIAL INFORMATION** 

**Item 1. Financial Statements.** 

**ZAPATA QUANTUM, INC.** 

**CONDENSED CONSOLIDATED BALANCE SHEETS** 

**(In thousands, except share and per share amounts)** 

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2025** | **December 31,<br> 2024** |
|  | **(Unaudited)** |  |
| **Assets** |  |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $288 | $359 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable ($1,567 and $1,567 from related parties, respectively) | 1595 | 1595 |
| &nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 164 | 229 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 2047 | 2183 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | 521 | 550 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $2568 | $2733 |
| **Liabilities and Stockholders' Deficit** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable ($5,504 and $5,504 to related parties, respectively) | $14015 | $13966 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | 3061 | 2611 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred legal fees | 2620 | 2620 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | 406 | 406 |
| &nbsp;&nbsp;&nbsp;&nbsp;Forward purchase agreement settlement liability | 2436 | 2436 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note payable - related party, current | 1930 | 1618 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 24468 | 23657 |
| &nbsp;&nbsp;&nbsp;&nbsp;Senior secured notes | 2313 | 2237 |
| &nbsp;&nbsp;&nbsp;&nbsp;Note payable - related party, non-current |  | 312 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 26781 | 26206 |
| Commitments and contingencies (Note 16) |  |  |
| Stockholders' deficit: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock, $0.0001 par value; 600,000,000 and 600,000,000 shares authorized at March 31, 2025 and December 31, 2024, respectively; 43,614,506 and 43,589,506 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively | 4 | 4 |
| &nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 104345 | 104301 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (123) | (109) |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated deficit | (128439) | (127669) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' deficit | (24213) | (23473) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities, convertible preferred stock and stockholders' deficit | $2568 | $2733 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**ZAPATA QUANTUM, INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS** 

**(UNAUDITED)** 

**(In thousands, except share and per share amounts)** 

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2025** | **2024** |
| Revenue ($0 and $433 from related parties, respectively) | $— | $1218 |
| Cost of revenue |  | 1052 |
| &nbsp;&nbsp;&nbsp;&nbsp;Gross profit |  | 166 |
| Operating expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Sales and marketing ($0, an $696 from related parties, respectively) |  | 1629 |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development |  | 1407 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative | 680 | 2206 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 680 | 5242 |
| Loss from operations | (680) | (5076) |
| Other income (expense): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (102) | (784) |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on issuance of forward purchase agreement derivative liability |  | (4935) |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on issuance of senior secured notes |  | (9776) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other income (expense), net | 12 | (1743) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expense, net | (90) | (17238) |
| Net loss before income taxes | (770) | (22314) |
| Provision for income taxes |  | (6) |
| Net loss | $(770) | $(22320) |
| Net loss per share attributable to common stockholders, basic and diluted | $(0.02) | $(4.09) |
| Weighted-average common shares outstanding, basic and diluted | 42482376 | 5457386 |
| Net loss | $(770) | $(22320) |
| Foreign currency translation adjustment | (14) | (15) |
| Comprehensive loss | $(784) | $(22335) |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**ZAPATA QUANTUM, INC.** 

**CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' DEFICIT** 

**(UNAUDITED)** 

**For the three months ended March 31, 2025 and 2024** 

**(In thousands, except share amounts)** 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Convertible Preferred<br> Stock ($0.0001 par<br> value)** | **Convertible Preferred<br> Stock ($0.0001 par<br> value)** | **Common Stock<br> ($0.0001 par value)** | **Common Stock<br> ($0.0001 par value)** | | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional<br> Paid-in**<br>**Capital** | **Accumulated<br> Other<br> Comprehensive**<br>**Loss** | **Accumulated**<br>**Deficit** | **Total<br> Stockholders'**<br>**Deficit** |
| **Balances at December 31, 2023** | 14222580 | $64716 | 5118553 | $— | $14633 | $(49) | $(89526) | $(74942) |
| Retroactive application of reverse recapitalization | (1221466) |  | (439603) |  |  |  |  |  |
| Adjusted balance, beginning of period | 13001114 | 64716 | 4678950 |  | 14633 | (49) | (89526) | (74942) |
| Issuance of common stock resulting from exercise of stock options |  |  | 47183 |  | 68 |  |  | 68 |
| Stock-based compensation expense |  |  |  |  | 191 |  |  | 191 |
| Loss on issuance of senior secured notes |  |  |  |  | 9776 |  |  | 9776 |
| Issuance of common stock pursuant to the forward purchase agreement |  |  | 500000 |  | (10986) |  |  | (10986) |
| Issuance of common stock related to the conversion of Senior Secured Notes (856,202 shares or $3,853 to related parties) |  |  | 3257876 |  | 14660 |  |  | 14660 |
| Issuance of common stock in connection with debt issuance costs related to senior secured notes and capital markets advisory agreements |  |  | 42372 |  | 352 |  |  | 352 |
| Conversion of redeemable convertible preferred stock into common stock in connection with the reverse recapitalization | (13001114) | (64716) | 13001114 | 1 | 64715 |  |  | 64716 |
| Issuance of common stock upon the reverse recapitalization |  |  | 7596206 | 1 | 4477 |  |  | 4478 |
| Issuance costs in connection with the reverse recapitalization |  |  |  |  | (7058) |  |  | (7058) |
| Net loss |  |  |  |  |  |  | (22320) | (22320) |
| Cumulative translation adjustment |  |  |  |  |  | (15) |  | (15) |
| **Balances at March 31, 2024** |  | $— | 29123701 | $2 | $90828 | $(64) | $(111846) | $(21080) |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Convertible Preferred<br> Stock ($0.0001 par<br> value)** | **Convertible Preferred<br> Stock ($0.0001 par<br> value)** | **Common Stock<br> ($0.0001 par value)** | **Common Stock<br> ($0.0001 par value)** | | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional<br> Paid-in**<br>**Capital** | **Accumulated<br> Other<br> Comprehensive**<br>**Loss** | **Accumulated**<br>**Deficit** | **Total<br> Stockholders'**<br>**Deficit** |
| **Balances at December 31, 2024** |  | $— | 43589506 | $4 | $104301 | $(109) | $(127669) | $(23473) |
| Vesting of restricted stock units |  |  | 25000 |  |  |  |  |  |
| Stock-based compensation expense |  |  |  |  | 44 |  |  | 44 |
| Net loss |  |  |  |  |  |  | (770) | (770) |
| Cumulative translation adjustment |  |  |  |  |  | (14) |  | (14) |
| **Balances at March 31, 2025** |  | $— | 43614506 | $4 | $104345 | $(123) | $(128439) | $(24213) |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**ZAPATA QUANTUM, INC.** 

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS** 

**(UNAUDITED)** 

**(In thousands)** 

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended<br> March 31,** | **For the Three Months Ended<br> March 31,** |
|  | **2025** | **2024** |
| **Cash flows from operating activities:** |  |  |
| Net loss | $(770) | $(22320) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization |  | 38 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-cash interest expense | 525 | 761 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-cash vendor payments |  | 150 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on issuance of forward purchase agreement derivative liability |  | 4935 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on issuance of senior secured notes |  | 9776 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 44 | 191 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-cash lease expense |  | 87 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity line of credit commitment expense |  | 1688 |
| &nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable |  | 809 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current and non-current assets | 94 | (736) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 48 | 2109 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities |  | 550 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue |  | (94) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities |  | (91) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | (59) | (2147) |
| **Cash flows from investing activities:** |  |  |
| Purchases of property and equipment |  | (11) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities |  | (11) |
| **Cash flows from financing activities:** |  |  |
| Payment of deferred offering costs |  | (1500) |
| Proceeds from the exercise of stock options |  | 68 |
| Proceeds from the reverse recapitalization |  | 12636 |
| Prepayment for forward purchase agreement |  | (10986) |
| Proceeds from senior and senior secured notes |  | 5878 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities |  | 6096 |
| **Effect of exchange rate changes on cash and cash equivalents** | (12) | (19) |
| **Net increase (decrease) in cash and cash equivalents** | (71) | 3919 |
| Cash and cash equivalents and restricted cash at beginning of period | 359 | 3469 |
| Cash and cash equivalents and restricted cash at end of period | $288 | $7388 |
| **Supplemental disclosures** |  |  |
| Issuance of common stock in connection with conversion of senior secured notes ($3,853 and $0 from related parties, respectively) | $— | $14660 |
| Issuance of common stock in connection with debt issuance costs related to senior secured notes and capital markets advisory agreements | $— | $352 |
| Issuance of senior secured notes in lieu of payments for offering costs and capital markets advisory agreements | $— | $1150 |
| Deferred offering costs included in accounts payable and accrued expenses and other current liabilities | $— | $4222 |
| Debt issuance costs in included in accrued expenses and other current liabilities | $— | $35 |
| Conversion of convertible preferred stock upon the reverse recapitalization | $— | $64716 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**ZAPATA QUANTUM, INC.**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

**(Dollar amounts in thousands, except per share and share amounts)**

&nbsp;&nbsp;&nbsp;&nbsp;**1.** **Nature of the Business and Basis of Presentation** 

Zapata Quantum, Inc., formerly known as Zapata Computing Holdings Inc. and, prior to that as, as Andretti Acquisition Corp. ("AAC") was incorporated as a Cayman Islands exempted company on January 20, 2021. Effective August 21, 2025, Zapata Computing Holdings, Inc. changed its name to Zapata Quantum, Inc. On March 28, 2024, AAC filed an application for deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which AAC was domesticated and continues as a Delaware corporation and changed its name to Zapata Computing Holdings Inc. AAC was formed for the purpose of effecting a merger, consolidation share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities. On March 28, 2024 (the "Closing Date" or "Closing"), AAC consummated a business combination with Zapata Computing, Inc. ("Legacy Zapata") pursuant to the Business Combination Agreement by and among AAC, Tigre Merger Sub, Inc. and Legacy Zapata entered into on September 6, 2023 (the "Business Combination Agreement").

Zapata Quantum, Inc. is a holding company whose principal asset is its ownership interest in Legacy Zapata and operates and controls all of the businesses and operations of Legacy Zapata and its subsidiaries. Zapata Quantum, Inc. and its predecessor, AAC, are collectively referred to herein as "Zapata" or the "Company". On the Closing Date, AAC and Legacy Zapata, consummated a business combination (the "Merger") (Note 3) pursuant to the Business Combination Agreement. In connection with the Closing of the Merger, AAC changed its name to Zapata Computing Holdings Inc. The Company's common stock and warrants commenced trading on the Nasdaq Global Market and the Nasdaq Capital Market, respectively, under the new trading symbols "ZPTA" and "ZPTAW", respectively, on April 1, 2024. The Merger was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, AAC, which was the legal acquirer, was treated as the "acquired" company for financial reporting purposes and Legacy Zapata, a direct wholly owned subsidiary of AAC, was treated as the accounting acquirer.

The Company's equity structure has been restated in all comparative periods up to the Closing Date, to reflect the number of shares of the Company's common stock, par value $0.0001, issued to Legacy Zapata's stockholders in connection with the recapitalization transaction. As such, the Company's common stock and the corresponding capital amounts and earnings per share related to Legacy Zapata's common stock prior to the Merger have been retrospectively restated as shares reflecting the conversion upon the closing of the Merger calculated in accordance with the Business Combination Agreement by multiplying each share of Convertible Preferred Stock (as defined below) by 0.9141 (the "Exchange Ratio").

On October 7, 2024, the Board of Directors of the Company approved the cessation of its operations (the "Operational Cessation") due to insufficient financial resources to continue funding ongoing operations and meet existing obligations. In connection with the Operational Cessation, the Company terminated all employees, except for a limited number of personnel retained for a short transitional period to assist with the wind-down of business activities. Following the Operational Cessation, the Company maintained minimal day-to-day operations.

In 2025, the Company undertook restructuring activities aimed at restarting certain aspects of its core business (Note 19).

As of October 31, 2025, following a strategic realignment to refocus on its core quantum mission, the Company will deliver subscription-based solutions to efficiently deploy and accelerate the development of quantum and hybrid quantum-classical computing applications. These solutions include software and software tools supported by services. Its software platform is based on patented technology and supports a wide range of use cases in cryptography, pharmaceuticals, manufacturing, materials discovery and defense. These planned operations are subject to the Company raising sufficient capital. The Company has worked with Fortune 500 enterprises and government agencies to unlock the potential of quantum computing. Prior to October 31, 2025, the Company also offered specialized generative AI solutions which used techniques inspired by quantum physics and were tailored to solving complex industrial problems. These solutions combined software and related services and were subscription-based.

***Going Concern***

 ****

The Company has evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued. The Company has incurred significant losses and negative cash flows from operations since the inception of Legacy Zapata in November 2017 and expects to continue to incur losses and negative cash flows for the foreseeable future as the Company expands its penetration of the quantum computing application development market.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

The Company is subject to risks and uncertainties similar to those of other companies of similar size in its industry, including, but not limited to, the need for successful development of products, competition from substitute products and services from larger companies, protection of proprietary technology, patent litigation, dependence on key individuals, risks associated with changes in information technology, and the ability to raise additional capital to fund operations. The Company's long-term success is dependent upon its ability to successfully market, deliver, and scale its quantum computing application development solutions, increase revenue, meet its obligations, obtain additional capital when needed and, ultimately, achieve profitable operations.

Since inception through March 31, 2025, the Company has financed its operations primarily through sales of its Convertible Preferred Stock, as defined below, and common stock and with issuances of Senior Notes and Senior Secured Notes, as defined below. The Company has incurred a net loss of $770 for the three months ended March 31, 2025. As of March 31, 2025 and December 31, 2024, the Company had an accumulated deficit of $128,439 and $127,669, respectively.

The Company's ability to continue as a going concern is dependent upon the Company's ability to raise capital through future equity or debt financing and generate profits from its operations. The Company is pursuing all available options for funding, which include seeking public or private investments and funding through the sale of equity or debt securities.

Subsequent to March 31, 2025, the Company raised an aggregate of $3,000 through the issuance of Convertible Notes and $1,500 through the sale of Series A Convertible Preferred Stock. The proceeds from the Convertible Notes were used to repay one of the Company's outstanding Senior Secured Notes. In addition, in 2025, the Company entered into conversion agreements with certain creditors to settle approximately $9,222 of accounts payable, accrued expenses, and notes payable to related parties. The Company also settled its obligation of $2,436 under the Forward Purchase Agreement through the issuance of shares of the Company's common stock. These activities were undertaken as part of the Company's ongoing efforts to improve the Company's capital structure and provide the liquidity necessary to support restarting certain aspects of its core business (Note 19).

Although Management believes that it will be able to continue to raise funds by sale of its securities to provide the additional cash needed to meet the Company's obligations, the restructuring activities aimed at restarting certain aspects of its core business require substantial funds to implement and there is no assurance that the Company will be able to continue raising the additional capital necessary to continue operations and execute on the Company's business plan.

These factors raise substantial doubt about the Company's ability to continue as a going concern.

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. In addition, the Company's independent registered public accounting firm, in its report on the Company's December 31, 2024 financial statements, has expressed substantial doubt about the Company's ability to continue as a going concern. The Company has evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued. The Company has incurred significant losses and negative cash flows from operations since the inception of Legacy Zapata in November 2017 and expects to continue to incur losses and negative cash flows for the foreseeable future as the Company expands its penetration of the quantum computing application development solutions market.

**2. Summary of Significant Accounting Policies** 

The Company's significant accounting policies are detailed in "Note 2. Summary of Significant Accounting Policies" of the Company's Annual Report. The Company uses the same accounting policies in preparing its quarterly and annual consolidated financial statements. There have been no material changes to significant accounting policies during the three months ended March 31, 2025.

 ****

***Use of Estimates***

The preparation of the Company's unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected within these condensed consolidated financial statements include, but are not limited to, revenue recognition, the Forward Purchase Agreement derivative liability, the valuation of the Company's common stock, and the fair value of stock-based awards. The Company's estimates are based on historical information available as of the date of the unaudited condensed consolidated financial statements and various other assumptions that the Company believes are reasonable under the circumstances. Actual results may differ materially from those estimates or assumptions.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

***Recently Issued Accounting Pronouncements***

In December 2023, the FASB issued ASU 2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures*, which requires enhanced income tax disclosures, including specific categories and disaggregation of information in the effective tax rate reconciliation, disaggregated information related to income taxes paid, income or loss from continuing operations before income tax expense or benefit, and income tax expense or benefit from continuing operations. The requirements of the ASU are effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the impact of this pronouncement on its related disclosures.

In March 2024, the FASB issued ASU 2024-02, *Codification Improvements—Amendments to Remove References to the Concepts Statements*, which amends the Codification to remove references to various concepts statements and impacts various topics in the Codification. The amendments apply to all reporting entities within the scope of the affected accounting guidance, but in most instances the references removed are extraneous and not required to understand or apply the guidance. Generally, the amendments in ASU 2024-02 are not intended to result in significant accounting changes for most entities. The guidance in this update is effective for fiscal years beginning after December 15, 2024. The Company is currently in the process of evaluating the effects of this pronouncement on its related disclosures.

In November 2024, the FASB issued ASU 2024-03, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)*: *Disaggregation of Income Statement Expenses*. This ASU requires more detailed disclosures, on an annual and interim basis, about specified categories of expenses (including employee compensation, depreciation, and amortization) included in certain expense captions presented on the face of the income statement. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. This ASU may be applied either prospectively or retrospectively. The Company is currently in the process of evaluating the impact of this pronouncement on its related disclosures.

 **3. Merger** 

On March 28, 2024, the Company completed its planned Merger with Legacy Zapata, pursuant to which Legacy Zapata became a wholly owned subsidiary of the Company.

In connection with the Merger, AAC filed an application for deregistration with the Cayman Islands Registrar of Companies and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the state of Delaware, under which AAC was domesticated and continues as a Delaware corporation (the "Domestication"), changing its name to Zapata Computing Holdings Inc. At the effective time of the Domestication, existing holders of ordinary shares of AAC received 7,596,206 shares of the Company's common stock in exchange for their Class A and Class B ordinary shares held immediately prior to the consummation of the Merger.

With the Closing of the Merger, holders of shares of Legacy Zapata common stock and Legacy Zapata Convertible Preferred Stock received an aggregate of 17,696,425 shares of the Company's common stock, and holders of Legacy Zapata Options received options to purchase an aggregate of 3,016,409 shares of the Company's common stock, determined by giving effect of the Exchange Ratio of 0.9141.

For accounting purposes, the Merger was accounted for as a reverse recapitalization whereby Legacy Zapata was treated as the accounting acquirer and AAC was treated as the acquired company. This determination was primarily based on the following factors: (i) Legacy Zapata's existing stockholders had the majority of the voting interest in the combined entity with an approximate 63% voting interest; (ii) the combined company's board of directors consisted of seven board members with one board member designated by AAC, and each of the remaining six board members were members of the board of directors of Legacy Zapata and one additional independent board member; (iii) Legacy Zapata's senior management comprised all the senior management of the combined company; and (iv) Legacy Zapata's existing operations comprised the ongoing operations of the combined company. In accordance with guidance applicable to these circumstances, the Merger was treated as the equivalent of Legacy Zapata issuing stock for the net assets of AAC, accompanied by a recapitalization. The net assets of AAC were stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Merger were those of Legacy Zapata.

On April 1, 2024, in connection with the consummation of the Merger, the Company's common stock was listed on the Nasdaq Global Market, and the Public Warrants and the Private Placement Warrants were listed on the Nasdaq Capital Market, under the new trading symbols "ZPTA" and "ZPTAW," respectively. Costs paid by the Company directly attributable to the Merger were $7,058 and were treated as issuance costs and netted against additional paid-in-capital in the condensed consolidated balance sheet of the Company. Additionally, upon the consummation of the Merger, the holders of certain outstanding Senior Secured Notes elected to convert the principal of their notes and accrued interest thereon in an aggregate amount of $14,660 into 3,257,876 shares of the Company's common stock (856,202 shares to related parties) in accordance with their terms, at a conversion price of $4.50 per share. Aggregate principal and accrued interest of $2,313 on the Senior Secured Notes remains outstanding as of March 31, 2025.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

***Merger Consideration***

 ****

The following table reconciles the elements of the Merger to the condensed consolidated statement of cash flows and the condensed consolidated statement of convertible preferred stock and stockholders' deficit. Upon the Closing of the Merger, the Company assumed liabilities of $8,159 from AAC, which was comprised of $223 of accounts payable, $1,987 of accrued expenses and other current liabilities, $2,619 of note payable – related party, and $3,330 of deferred legal fees.

---

| | |
|:---|:---|
|  | **March 28, 2024** |
| Cash - AAC Trust (net of redemptions) | $20283 |
| Less: AAC costs paid at Closing | (7317) |
| Less: Notes payable - related party paid at Closing | (330) |
| Net proceeds from the Merger | 12636 |
| Less: Liabilities obtained from AAC | (8159) |
| &nbsp;&nbsp;&nbsp;Merger consideration | $4477 |

---

The number of shares of the Company's common stock outstanding immediately following the consummation of the Merger was as follows:

---

| | |
|:---|:---|
|  | **Share<br> Ownership** |
| Legacy Zapata equityholders | 17696425 |
| AAC public shareholders | 1846206 |
| AAC Sponsor shares | 5750000 |
| Senior Secured Note holders | 3257876 |
| Additional Shares issued pursuant to the Forward Purchase Agreement | 500000 |
| Capital markets advisors | 42372 |
| &nbsp;&nbsp;&nbsp;Total shares of common stock immediately after the Merger | 29092879 |

---

**4. Revenue From Contracts With Customers** 

All revenue from contracts with customers was generated in the U.S. during the three months ended March 31, 2024. No revenue was recognized for the three months ended March 31, 2025 due to the Operational Cessation (Note 1) in the fourth quarter of 2024.

Revenue from contracts with customers recognized for the three months ended March 31, 2025 and 2023 consists of the following:

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| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2025** | **2024** |
| Point in time | $— | $— |
| Over time |  | 1218 |
| Total | $— | $1218 |

---

The Company's balances resulting from contracts with customers include the following:

**Contract Acquisition Costs—**As of March 31, 2025 and December 31, 2024, The Company had no capitalized contract acquisition costs. There was $0 and $10 of amortization of contract acquisition costs recognized in the condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2025 and 2024, respectively.

**Accounts Receivable—** As of March 31, 2025 and December 31, 2024, there were accounts receivable due from related parties amounting to $1,567 and $1,567, respectively. As of March 31, 2025 and December 31, 2024, the Company had zero 0 allowance for credit losses.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

**Deferred Revenue—**Balances from contracts with customers for the three months ended March 31, 2025, consist of the following:

---

| | | |
|:---|:---|:---|
|  | **End of Period** | **Beginning of<br> Period** |
| Accounts receivable (including $1,567 and $1,567 from related parties at March 31, 2025 and December 31, 2024, respectively) | $1567 | $1567 |
| Unbilled accounts receivable (including $0 and $0 from related parties at March 31, 2025 and December 31, 2024, respectively) | 28 | 28 |
| Deferred revenue | 406 | 406 |

---

Balances from contracts with customers for the year ended December 31, 2024, consist of the following:

---

| | | |
|:---|:---|:---|
|  | **End of Year** | **Beginning of<br> Year** |
| Accounts receivable (including $1,567 and $562 from related<br> parties at December 31, 2024 and 2023, respectively) | $1567 | $1341 |
| Unbilled accounts receivable (including $0 and $267 from<br> related parties at December 31, 2024 and 2023, respectively) | 28 | 597 |
| Deferred revenue | 406 | 744 |

---

The following table summarizes customers who represent greater than 10% of the Company's total revenue during the three and three months ended March 31, 2025, as well as customers who represent greater than 10% of the Company's total accounts receivable as of March 31, 2025 and December 31, 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Percentage of Revenue** | **Percentage of Revenue** | **Percentage of Accounts Receivable** | **Percentage of Accounts Receivable** |
|  | **Three Months Ended<br> March 31,** | **Three Months Ended<br> March 31,** | **March 31,<br> 2025** | **December 31,<br> 2024** |
|  | **2025** | **2024** | | |
| Customer A\* | N/A\*\* | 36% | 98% | 98% |
| Customer B | N/A\*\* | 22% | N/A\*\* | N/A\*\* |
| Customer C | N/A\*\* | 20% | N/A\*\* | N/A\*\* |
| Customer D | N/A\*\* | 14% | N/A\*\* | N/A\*\* |

---

\*Related party

\*\*Less than 10% of total revenue or accounts receivable

**5. Fair Value Measurements** 

The following tables present the Company's fair value hierarchy for its assets and liabilities that are measured at fair value on a recurring basis and indicate the level within the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair Value Measurements at March 31, 2025** | **Fair Value Measurements at March 31, 2025** | **Fair Value Measurements at March 31, 2025** | **Fair Value Measurements at March 31, 2025** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
| Assets: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash equivalents: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Money market mutual funds | $38 | $— | $— | $38 |
|  | $38 | $— | $— | $38 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fair Value Measurements at December 31, 2024** | **Fair Value Measurements at December 31, 2024** | **Fair Value Measurements at December 31, 2024** | **Fair Value Measurements at December 31, 2024** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
| Assets: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash equivalents: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Money market mutual funds | $38 | $— | $— | $38 |
|  | $38 | $— | $— | $38 |

---

For the three months ended March 31, 2025 and 2023, there were no transfers between Level 1, Level 2 and Level 3.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

**6. Accrued Expenses and Other Current Liabilities** 

Accrued expenses and other current liabilities consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2025** | **December 31,<br> 2024** |
| Accrued employee compensation and benefit | $77 | $77 |
| Accrued professional fees | 1312 | 1312 |
| Refunds payable | 750 | 750 |
| Accrued contract obligations | 216 |  |
| Other | 706 | 472 |
| Accrued expenses and other current liabilities | $3061 | $2611 |

---

**Refund Payable—**The third party purchased a one-year subscription to the Company's Orquestra Enterprise Solution on June 27, 2024, and prepaid $1,000 fee. Following the Company's Operational Cessation (Note 1) and early termination of the subscription, the third party is entitled to a prorated refund of $750 for services it will no longer receive.

**Accrued contract obligations—**On February 12, 2024, the Company entered into Leap Cloud Subscription Agreement. As of March 31, 2025, the Company accrued $216 related to the agreement. (Note 16).

**7. Forward Purchase Agreement**

On March 25, 2024, the Company entered into a forward purchase agreement with Sandia. The Forward Purchase Agreement contains (i) an Optional Early Termination provision, which is considered an in-substance put option (the "Optional Early Termination") and (ii) a Variable Maturity Consideration which is the amount of the Settlement Amount Adjustment in excess of the Settlement Amount (the "Variable Maturity Consideration"). The Optional Early Termination and the Variable Maturity Consideration, as combined, are considered a freestanding financial instrument as the Optional Early Termination and the Variable Maturity Consideration cannot be legally detachable and separately exercisable from each other and together, meet the definition of a derivative instrument. Pursuant to the Forward Purchase Agreement, the Seller has the option to early terminate the arrangement in whole or in part by providing written notice to the Company, and the Seller will pay the Company an amount equal to the product of the number of shares that are early terminated and the reset price then in effect. If the Seller exercises an Optional Early Termination, then the Settlement Amount and the Settlement Amount Adjustment to be paid at the Valuation Date will be reduced in proportion to the number of shares subject to the Optional Early Termination. Additionally, the Company may be obligated to pay consideration to the Seller in cash or, under certain circumstances, in shares of the Company's common stock, if the Settlement Amount Adjustment exceeds the Settlement Amount.

The Company recorded the derivative instrument as a liability on its condensed consolidated balance sheets and measured it at fair value with the initial value of the derivative instrument recorded as a loss on issuance of forward purchase agreement derivative liability in the condensed consolidated statements of operations and comprehensive loss. The forward purchase agreement derivative liability was subsequently remeasured to fair value at each reporting period, with changes in fair value recognized in the condensed consolidated statements of operations and comprehensive loss.

Upon the occurrence of the VWAP Trigger Event, which was met when the Company's common stock traded below $1.00 per share for 20 trading days within any 30 consecutive trading-day period, Sandia exercised its right to accelerate the Valuation Date to October 8, 2024. The Company received notice from Sandia accelerating the Valuation Date to October 8, 2024. As a result, the forward purchase agreement was settled and the Company became obligated to pay Sandia $2,436 in cash or shares as of March 31, 2025 and December 31, 2024.

In June 2025, the Company settled its obligation under the Forward Purchase Agreement by issuing 6,591,000 shares of the Company's common stock to Sandia as described in Note 19, Subsequent Events.

**8. Debt** 

The aggregate principal amount of debt outstanding as of March 31, 2025 and December 31, 2023 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2025** | **December 31,<br> 2024** |
| Senior secured notes | $2313 | $2237 |
| Note payable - related parties | 1930 | 1930 |
| Total Debt | $4243 | $4167 |

---

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

Current and non-current debt obligations reflected in the condensed consolidated balance sheets as of March 31, 2025 and December 31, 2023 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **March 31,<br> 2025** | **December 31,<br> 2024** |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Note payable - related parties | $1930 | $1618 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt, current portion | 1930 | 1618 |
| Non-current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Note payable - related parties |  | 312 |
| &nbsp;&nbsp;&nbsp;&nbsp;Senior secured notes | 2313 | 2237 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt, net of current portion | 2313 | 2549 |
| Total Debt | $4243 | $4167 |

---

***Senior Secured Notes***

As of December 31, 2023, Legacy Zapata had an outstanding balance of Senior Secured Notes of $8,900, which was netted with $158 of unamortized debt issuance costs. From January 2024 through March 2024, Legacy Zapata issued $7,150 in additional aggregate principal amount of Senior Secured Notes, which includes certain Senior Secured Notes with an aggregate principal amount of $1,150 that were issued to third party advisors in lieu of cash payment for services rendered to Legacy Zapata related to the Merger (Note 3). The Senior Secured Notes issued from January 2024 to March 2024 totaling $6,150 were issued at a substantial premium. Accordingly, the Company accounted for the issuance of these Senior Secured Notes under the amortized cost model, which is the principal plus accrued interest. The remaining Senior Secured Note issued to a third-party advisor totaling $1,000 is carried at redemption value, which is the principal plus accrued interest. The Company issued a Senior Secured Note to a third party for capital market advisory services that vested contingently with the Merger. Upon the satisfaction of the performance condition as described in the agreement, the Company accounted for the Senior Secured Note as a stock-based award granted to a non-employee and measured the award based on the fair value on the Merger date, with the liability portion of the award recorded as Senior Secured Notes at the redemption value, and the excess fair value recorded as a loss on issuance of convertible note within total other expense, net in the condensed consolidated statements of operations and comprehensive loss.

Upon the Closing of the Merger, a portion of the aggregate outstanding the Senior Secured Notes converted into 3,257,876 shares of the Company's common stock (856,202 shares to related parties). Upon the conversion of the Senior Secured Notes, the principal balance of the debt of $14,207 and associated accrued interest of $453 were converted, resulting in an increase in common stock and additional paid-in capital of $14,660. Certain holders of the Senior Secured Notes, holding $2,000 in aggregate principal, did not convert their Senior Secured Notes into shares of the Company's common stock.

The Company recognizes the remaining Senior Secured Notes at amortized cost. As of March 31, 2025, the $2,313 of aggregate principal and accrued interest on the outstanding Senior Secured Notes did not include any associated costs that are being recorded as a debt discount and amortized over the remaining term of the outstanding Senior Secured Notes. The $2,313 of aggregate principal and accrued interest on the outstanding Senior Secured Notes mature on December 15, 2026.

In January 2025, one of the Senior Secured Notes of $1,000 and related accrued and unpaid interest of $158 was assigned from its original note holder to a third-party. The transfer did not modify the terms of the note or its accounting treatment.

***Notes Payable - Related Parties***

 

To finance transaction costs related to the Merger, the Sponsor and certain AAC officers and directors provided working capital loans (the "Notes Payable – Related Party") prior to Closing. These notes were repayable at the Merger Closing without interest or, at AAC's discretion, up to $1,500 could be converted into Private Placement Warrants at $1.00 per warrant (Note 11).

On March 28, 2024, the Notes Payable – Related Party were amended to defer repayment of the outstanding principal and accrued interest of $2,619. The amended terms require repayment in monthly installments, beginning thirty days after the Lincoln Park Registration Statement became effective on April 18, 2024 (Notes 3 and 10). No note holders elected to convert their loans into warrants at Closing. The notes bear interest at 4.5% per annum and are accounted for at amortized cost. As of March 31, 2025, the outstanding balance was $1,930, with no unamortized debt discount.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

As of March 31, 2025, future minimum payments required on the Senior Secured Notes and the Notes Payable – Related Party are as follows:

---

| | |
|:---|:---|
| **Year Ending** | **Amount** |
| 2025(remaining) | $1730 |
| 2026 | 2625 |
| Total future minimum payments | 4355 |
| Less: imputed interest | (112) |
| Total Debt | $4243 |

---

 **9. Convertible Preferred Stock**

In connection with the Merger on March 28, 2024, each holder of the Convertible Preferred Stock was converted into the right to receive 0.9141 shares of the Company's common stock. The Company determined that the Merger constituted a deemed liquidation under its charter and, as such, the holders of the Convertible Preferred Stock were entitled to receive an amount per share equal to the greater of i) the applicable original issue price of the applicable series of the Convertible Preferred Stock, plus any dividends declared but unpaid thereon (the "Preference"), or ii) such amount per share as would have been payable had all shares of the Convertible Preferred Stock been converted into common stock immediately prior to the Merger (the "As Converted Amount"). Upon the Closing of the Merger, the Company determined that the As Converted Amount was greater than the Preference and converted 14,222,580 shares of Convertible Preferred Stock into 13,001,114 shares of the Company's common stock. The Company's capital amounts prior to the Merger have been retrospectively restated as shares reflecting the conversion ratio of 0.9141 established in the Merger. Following the Closing, the Company has no shares of Convertible Preferred Stock outstanding.

**10. Common Stock**

As of March 31, 2025 and December 31, 2024, the Company had authorized 600,000,000 shares of $0.0001 par value common stock. Each share of common stock entitles the holder to one vote on all matters submitted to the stockholders for a vote. The holders of common stock are entitled to receive dividends, if any, as declared by the Company's Board of Directors.

Under the terms of the Company's certificate of incorporation, the Company's Board of Directors is authorized to direct the Company, without any action or vote by its stockholders (except as may be provided by the terms of any class or series of Company preferred stock then outstanding), to issue shares of preferred stock in one or more series without the approval of the Company's stockholders. The Company's Board of Directors has the discretion to determine the rights, powers, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock.

***Unvested Shares***

 ****

In connection with the Closing on March 28, 2024, 1,129,630 shares of Sponsor Shares became unvested and are subject to the forfeiture pursuant to the closing available cash provisions as described in the sponsor support agreement in contemplation of the Merger. All of the Unvested Shares will become vested if, within three years of the Closing, the volume-weighted average price of the Company's common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period, or if there is a change of control of the Company. If neither of these events occur within three years of the Closing, then the Unvested Shares will be forfeited and shall be transferred by the sponsor and the sponsor co-investor to the Company, without any consideration for such transfer. The Unvested Shares are indexed to the Company's own stock and are therefore classified as equity in the Company's condensed consolidated financial statements. No Unvested Shares vested during the three months ended March 31, 2025.

***Lincoln Park Purchase Agreement***

 

The Company entered into two equity purchase agreements with Lincoln Park Capital Fund, LLC ("Lincoln Park") on December 19, 2023 (the "2023 Purchase Agreement") and August 13, 2024 (the "2024 Purchase Agreement"). Under the 2023 Purchase Agreement, Lincoln Park committed to purchase up to $75,000 of the Company's common stock over a 36-month period following the Merger Closing. The Company issued 712,025 shares as a $1,688 Commitment Fee on April 11, 2024. A related registration statement covering the shares issuable under the agreement was filed on April 12, 2024 and declared effective on April 18, 2024. As of March 31, 2025, the Company had issued 10,378,780 shares for total proceeds of $7,700 (excluding Commitment Shares).

Under the 2024 Purchase Agreement, Lincoln Park committed to purchase up to $10,000 of common stock over a 24-month period. The Company issued 500,000 Commitment Shares upon execution. The related registration statement was filed on September 3, 2024 and declared effective on September 9, 2024. As of March 31, 2025, the Company had issued 2,700,000 shares for total proceeds of $862 (excluding Commitment Shares).

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

 **

***Restricted Stock Units***

 **

A total of 25,000 RSUs vested during the three months ended March 31, 2025, and the corresponding shares were issued upon vesting (Note 12).

**11. Warrants** 

***Public Warrants and Private Placement Warrants***

 

As part of AAC's IPO, AAC issued Public Warrants to third-party investors where each whole warrant entitles the holder to purchase one share of AAC's common stock at an exercise price of $11.50 per share. Simultaneously with the closing of the IPO, AAC completed the private sale of Private Placement Warrants to the sponsor, where each warrant allows the holder to purchase one share of AAC's common stock at $11.50 per share. Additionally, pursuant to AACs' sponsor working capital loan agreement, the sponsor may convert up to $1,500 of the outstanding Notes Payable – Related Party into up to an additional 1,500,000 Private Placement Warrants at the price of $1.00 per warrant upon the Closing Date (Note 8). Upon the Closing Date, the option to convert up to $1,500 of the outstanding Notes Payable – Related Party amount into and up to an additional 1,500,000 Private Placement Warrants was not exercised. As of March 31, 2025, 11,499,982 Public Warrants and 13,550,000 Private Placement Warrants remained outstanding.

The Warrants expire on the fifth anniversary of the Merger or earlier upon redemption or liquidation and are exercisable commencing 30 days after the Merger, provided that the Company has an effective registration statement under the Securities Act covering the shares of the Company's common stock issuable upon exercise of the Warrants and a current prospectus relating to them is available or a valid exemption is available.

Public Warrants and Private Placement Warrants are exercisable to purchase one share of the Company's common stock at $11.50 per share. Public Warrants may be redeemed, in whole and not in part, at $0.01 per warrant with 30 days' notice if the Company's common stock trades at or above $18.00 for 20 out of 30 trading days. The Company may require holders to exercise Public Warrants on a cashless basis if the warrants are called for redemption. Private Placement Warrants are substantially identical to the Public Warrants except that (i) they cannot be redeemed by the Company, (ii) they are permanently exercisable on a cashless basis, and (iii) they are not transferable, assignable, or salable until 30 days after the Closing Date, except to permitted transferees. Private Placement Warrants also provide for an alternative issuance in the event of a tender offer or other change-of-control transaction, consistent with the warrant agreement.

As of March 31, 2025 and December 31, 2024, there were 11,499,982 and 11,500,000 Public Warrants outstanding, respectively. As of March 31, 2025 and December 31, 2024, there were 13,550,000 and 13,550,000 Private Placement Warrants outstanding, respectively. The Public Warrants and Private Placement Warrants qualify for equity classification in accordance with ASC 815-40, *Derivatives and Hedging*. Accordingly, the Warrants were initially measured at fair value and recorded within equity with no subsequent measures of changes in fair value.

**12. Compensation Plans**

In March 2024, the Company adopted the 2024 Equity and Incentive Plan (the "2024 Plan") and there were no material changes to the plan during the six months ended June 30, 2025. Under the 2024 Plan, the initial maximum number of shares of common stock reserved and available for issuance is 3,491,146 shares, subject to an annual increase on January 1 of each year, beginning January 1, 2025, equal to up to 5% of the total number of shares of common stock outstanding as of the immediately preceding December 31. Pursuant to the plan's annual evergreen provision, the share pool was automatically increased by 5% of the Company's outstanding common stock as of December 31, 2024, resulting in an additional 2,178,225 shares reserved effective January 1, 2025. As of March 31, 2025, a total of 5,669,371 shares were reserved for issuance under the 2024 Plan, of which 200,000 shares were issued and outstanding, 25,000 shares were issuable upon the vesting of restricted awards, and 5,444,371 shares remained available for future grants and for issuance upon the vesting of restricted awards.

***Stock Options***

 ****

The Company uses the Black-Scholes option-pricing model to value stock option awards; No stock options or RSUs were granted during the three months ended March 31, 2025 and 2024.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

Stock option activity during the three months ended March 31, 2025 is as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of<br> Shares** | **Weighted-<br> Average<br> Exercise Price** | **Weighted-Average<br> Remaining<br> Contractual Term<br> (Years)** | **Aggregate<br> Intrinsic Value** |
| Balance at December 31, 2024 | 2956748 | $1.94 | 6.66 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Forfeited and expired | (1853297) | 2.07 |  |  |
| Balance at March 31, 2025 | 1103451 | $1.74 | 7.01 | $— |
| Options vested and exercisable at March 31, 2025 | 503515 | $2.34 | 6.01 | $— |
| Options vested and expected to vest at March 31, 2025 | 1103451 | $1.74 | 7.01 | $— |

---

As of March 31, 2025, there was $376 of total unrecognized compensation cost related to unvested stock options. The Company expects to recognize the unrecognized compensation amount over a remaining weighted-average period of 3.1 years. The fair value of stock options that vested during the three months ended March 31, 2025 and 2024 was $185 and $0, respectively.

***Restricted Stock Units ("RSU")***

Nonvested RSU activity during the three months ended March 31, 2025, is as follows:

---

| | | |
|:---|:---|:---|
|  | **Number of<br> Shares** | **Weighted-<br> Average<br> Grant Date Fair Value** |
| Unvested restricted stock units at December 31, 2024 | 50000 | $0.57 |
| &nbsp;&nbsp;&nbsp;&nbsp;Vested | (25000) | $0.57 |
| Unvested restricted stock units at March 31, 2025 | 25000 |  |

---

As of March 31, 2025, the total unrecognized compensation cost related to unvested restricted common stock was $14. The Company expects to recognize the unrecognized compensation amount over a remaining weighted-average period of 0.75 years. The fair value of RSU that vested during the three months ended March 31, 2025 was $14.

***2024 Employee Stock Purchase Plan ("2024 ESPP")***

The Company adopted the 2024 ESPP in March 2024, and there were no material changes to the plan during the three months ended March 31, 2025.

***Stock-Based Compensation***

The following table below summarizes the classification of the Company's stock-based compensation expense related to stock options and restricted common stock in the condensed consolidated statements of operations and comprehensive loss:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2025** | **2024** |
| Research and development | $— | $37 |
| Sales and marketing |  | 20 |
| General and administrative | 44 | 124 |
| Cost of revenue |  | 10 |
|  | $44 | $191 |

---

**13. Leases** 

***Operating leases***

As a lessee, the Company leases certain office spaces under non-cancelable operating leases located in the United States and Canada. All of the Company's long-term lease agreements expired prior to and as of December 31, 2024. On May 7, 2024, the Company entered into a month-to-month lease in Canada that commenced on June 1, 2024, which was terminated in connection with the Operational Cessation (Note 1).

On July 19, 2024, the Company entered into a six-month office lease for office space in the United States that qualifies as a short-term lease. Operating lease payments are expensed using the straight-line method as an operating expense over the lease term. Lease expense for the three months ended March 31, 2025 was $1.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

**14. Segment Information**

The Company operates and manages its business activities on a consolidated basis and operates in a single reportable and operating segment. The Company's Chief Executive Officer, serving as the Chief Operating Decision Maker ("CODM"), oversees operations on an aggregated basis to allocate resources effectively. In assessing the Company's financial performance, the CODM regularly reviews consolidated net income (loss). Significant expense categories are not presented, as the expense information regularly provided to the CODM is presented on the same basis as the condensed consolidated statements of operations and comprehensive loss. The CODM relies on consolidated net loss as a comprehensive measure of the Company, considering all revenues and expenses, including cost of revenue, research and development expenses, general and administrative expenses and sales and marketing expenses, to assess the Company's overall performance and inform strategic decisions on cost control, pricing and investments. Additionally, the CODM also reviews total assets to assess the Company's financial position and resource allocation. The measure of segment assets is reported on the condensed consolidated balance sheet as total consolidated assets. The Company's long-lived assets consist primarily of property and equipment, net. As of March 31, 2025 the Company does not have material long-term assets outside the U.S.

**15. Income Taxes** 

For the three months ended March 31, 2025 and 2024, the Company recorded an income tax benefit and provision of $0 and $6, respectively, related to foreign income tax provisions. The Company's annual estimated effective tax rate differs from the U.S. federal statutory rate of 21% primarily due to the U.S. valuation allowance and the foreign rate differential related to the United Kingdom, Canada, Japan, and Spain.

**16. Commitments and Contingencies**

***Andretti Agreements – Related Party***

On February 10, 2022, the Company entered into a sponsorship agreement for marketing services to be provided by Andretti Autosport Holding Company, LLC (f/k/a Andretti Autosport Holding Company, Inc., "Andretti Global"). The total commitment under the sponsorship agreement is $8,000 and is due and payable over the period of February 2022 through December 2024. Through March 31, 2025, the Company has paid $3,500 under the agreement and for the three months ended March 31, 2025 and 2024, the Company recorded $0 and $696 in sales and marketing expense related to the sponsorship agreement. There was $4,500 included in accounts payable as of March 31, 2025 related to the sponsorship agreement.

On March 28, 2024, the Company entered into a sponsorship agreement with Andretti Autosport 1, LLC, an affiliate of Andretti Global. The agreement expires on December 31, 2024. Subject to the agreement, the Company is responsible for payments under the sponsorship agreement in an amount totaling $1,000.

***Advisory and Other Agreements***

In connection with the Merger, on September 13, 2023, the Company entered into an agreement with a third party for advisory services. In March 2024, the payment terms were amended to provide for a fee of $1,250, to be paid by the issuance of a Senior Secured Note with a principal amount of $1,000 and the remaining $250 in six monthly installments in cash of $42 per month commencing on May 15, 2024. From May 2024 through September 2024 the Company paid $209 to the third party. The Company ceased making payments in the fourth quarter of 2024 due to the Operational Cessation (Note 1), and the remaining balance was subsequently converted into the Company's common stock in the second quarter of 2025.

On February 9, 2024, the Company entered into an engagement letter with an additional third party, as amended on February 27, 2024. The Company agreed to pay the third party a non-refundable cash fee of $1,800, payable by the Company in monthly payments of $113 over the Term (as defined in Note 3) with $300 of such payment waivable if the Company voluntarily prepays $1,500 to the third party prior to December 31, 2024. Upon the Closing of the Merger, the Company recognized $1,800 as transaction costs, which recorded as a reduction in additional paid-in capital. From May 2024 through September 2024 the Company paid $563 to the third party. The Company ceased making payments in the fourth quarter of 2024 due to the Operational Cessation (Note 1), and the remaining balance was subsequently converted into the Company's common stock in the second quarter of 2025.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

The following table reflects the Company's obligations in connection with the aforementioned advisory and other agreements recorded in accounts payable, accrued expenses and other current liabilities, and non-current liabilities within the condensed consolidated balance sheet as of March 31, 2025.

---

| | |
|:---|:---|
| **Year ending** | **Amount** |
| 2025 (remaining) | $4986 |
| Total | $4986 |

---

In the fourth quarter of 2024, due to the Operational Cessation (Note 1), the Company ceased making payments on the advisory and other agreements described above and the remaining balance was subsequently converted into the Company's common stock in the second and fourth quarters of 2025.

***Collaborative Research Agreement*** 

On February 12, 2024, the Company entered into a collaborative research agreement with a third party, pursuant to which the Company and the third party partnered to develop a quantum generative AI application and a hybrid solver over a three-month term. The Company led the development of the application. The third party also contributed $1,000 to the project in the form of a Senior Secured Note, which it did not elect to convert into the Company's common stock upon the Closing of the Merger and remains outstanding.

The collaborative research agreement effectively terminated in October 2024 in connection with the Company's Operational Cessation (Note 1).

***Quantum Cloud Service Agreement***

On February 12, 2024, the Company entered into an agreement with a third party under which the third party will host the Company's quantum generative AI application on its cloud service and will provide support services for a period of 24 months. The Company has agreed to make payments in an aggregate amount equal to $2,063 to the third party over the agreement term as consideration for services rendered pursuant to the agreement, which will be due and payable from April 2024 to February 2027. On June 27, 2024, the agreement was amended to extend the services through November 2028, and the aggregate fees payable from the Company increased to $4,063 over the extended term. As of March 31, 2025, the Company recorded $216 in accrued expenses for the services. The outstanding purchase commitment for cloud services was $3,617 as of March 31, 2025.

The cloud service agreement was effectively terminated in October 2024 in connection with the Company's Operational Cessation (Note 1).

**17. Net Loss per Share** 

The following table sets forth the computation of basic and diluted net loss per common share attributable to stockholders:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2025** | **2024** |
| Numerator: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss attributable to common stockholders | $(770) | $(22320) |
| Denominator: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Weighted-average common shares outstanding, basic and diluted | 42482376 | 5457386 |
| Net loss per share attributable to common stockholders, <br> &nbsp;&nbsp;&nbsp;&nbsp; basic and diluted | $(0.02) | $(4.09) |

---

The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2025** | **2024** |
| Senior Secured Notes, including accrued interest | 272135 | 238001 |
| Public Warrants | 11499982 | 11499982 |
| Private Placement Warrants | 13550000 | 13550000 |
| Unvested Shares | 1129630 | 1129630 |
| Stock options to purchase common stock | 1103451 | 2918549 |
| Restricted stock units | 25000 |  |
|  | 27580198 | 29336162 |

---

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

**18. Related Party Transactions** 

A former member of the Board of Directors of Legacy Zapata that left the Board of Directors in March 2024 also provided consulting services to Legacy Zapata. For the three months ended March 31, 2025 and 2024,the Company remitted fees of $0 and $15 to the member of its Board of Directors for these services.

One of AAC's affiliates, Andretti Global, has preexisting contractual relationships with Legacy Zapata. In February 2022, Andretti Global entered into i) an enterprise solution subscription agreement and ii) a sponsorship agreement with Legacy Zapata (Note 16), both of which expire on December 31, 2024. During the three months ended March 31, 2025 and 2024, the Company recorded $0 and $433 in revenue related to the enterprise solution subscription agreement.

For the three months ended March 31, 2025 and 2024, the Company recorded $0 and $696 in sales and marketing expense related to the sponsorship agreement. The Company recognizes expense for the agreement over the period of service. The remaining committed future payments under the sponsorship agreement at March 31, 2025 include $4,500 in accounts payable at March 31, 2025. There was $1,567 and $1,567 due from related parties as of March 31, 2025 and December 31, 2024 and $5,504 and $5,504 of payables due to related parties in connection with these agreements as of March 31, 2025 and December 31, 2024, respectively.

On March 28, 2024, Legacy Zapata entered into a sponsorship agreement with Andretti Autosport 1, LLC, an affiliate of Andretti Global, which expires on December 31, 2024. Legacy Zapata is responsible for payments under the sponsorship agreement total $1,000.

On March 28, 2024, Legacy Zapata entered into an Order Form under the February 2022 enterprise solution subscription agreement with Andretti Global. Pursuant to the agreement, Andretti Global agreed to pay Legacy Zapata a total of $1,000, subject to Legacy Zapata's payment of the sponsorship fee to Andretti Autosport 1, LLC. Following the Operational Cessation (Note 1), the agreement was terminated and no payments were made.

In January 2025, a Senior Secured Note with $1,157 of principal and accrued interest was assigned to Sandia with no change to its terms.

**19. Subsequent Events**

The Company has evaluated all events subsequent to March 31, 2025 and through December 9, 2025, which represents the date these unaudited condensed consolidated financial statements were available to be issued.

***Forward Purchase Agreement***

In June 2025, the Company satisfied its obligations of $2,436 under the Forward Purchase Agreement through the issuance of 6,591,000 shares of the Company's common stock to Sandia.

***Convertible Promissory Notes and Warrants***

In June 2025 the Company entered into a securities purchase agreements (the "Purchase Agreements") with accredited investors pursuant to which the Company sold and issued secured convertible promissory notes ("Convertible Promissory Notes") and warrants to purchase 37,500,000 shares of Common Stock ("Warrants") for total gross proceeds of $3,000.

The Convertible Promissory Notes have a principal amount equal to the loan amount, mature on the one-year anniversary of the issuance date (subject to acceleration upon the occurrence of certain customary events of default or a change of control), and bear 10% per annum interest. The Convertible Promissory Notes are convertible into 75,000,000 shares of the Company's common stock at the option of the holder based on a conversion price of $0.04 per share, subject to certain adjustments. The Convertible Promissory Notes convert automatically upon the Company's completion of a securities offering resulting in gross proceeds of at least $5,000.

The Warrants have a term of five years. The Warrants have an exercise price of $0.04 per share, subject to certain adjustments. At any time when a registration statement registering the resale of shares issuable upon exercise of the Warrants is not effective, the Warrants can be exercised on a cashless basis by the holders.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

***Consent and Security Agreement and Intercreditor Agreement***

 

On June 12, 2025, the Company entered into a consent agreement (the "Consent") with one of its two Secured Senior Notes lenders (the "Existing Lender"). Under the Consent, the Existing Lender agreed to waive certain rights under its outstanding Senior Secured Note Agreement. The waiver covered any default or event of default under the Senior Secured Note Agreement arising from, or in connection with, the transactions contemplated by the Purchase Agreement described above, as well as any defaults existing as of the date of the Consent. In consideration for the waiver, the Company issued 34,000,000 shares of common stock to the Existing Lender.

In addition, the Company entered into an Intercreditor Agreement with the collateral agent and the Existing Lender providing for the relative rights with respect to the secured obligations of the Company.

***Conversion Agreements and Universal Resale and Registration Provisions***

 

In 2025, the Company entered into a series of conversion agreements (the "Conversion Agreements") with certain of its creditors. Pursuant to the Conversion Agreements: (i) certain creditors agreed to exchange an aggregate of approximately $5,380 of accounts payable and accrued expenses, including the settlement obligation under the Forward Purchase Agreement, for the issuance of 14,559,000 shares of the Company's common stock; (ii) Notes Payable – Related Parties with an aggregate principal amount of $1,998 were converted into 5,407,000 shares of the Company's common stock; and (iii) the Company issued 11,983 shares of its Series C Convertible Preferred Stock (convertible into up to 11,983,000 shares of common stock) to two creditors in settlement of an aggregate of $4,429 of accounts payable and accrued expenses.

*Universal Resale and Registration Provisions*

In connection with the Conversion Agreements, the Company and counterparties who received common stock or preferred stock entered into certain Universal Resale and Registration Provisions pursuant to which such recipients agreed to certain lock-up provisions restricting and limiting their sale, transfer, pledge, or disposal of any shares of common stock held by or issuable to such recipients.

***Termination of a Material Definitive Agreement***

 

In June 2025 the Company used approximately $1,343 of the proceeds from the Convertible Promissory Note described above to repay one of the Senior Secured Notes in the original principal amount of $1,000 and accrued interest of $343 issued to the Company on February 8, 2024. The Senior Secured Note is no longer outstanding.

***Compensatory Arrangements of Certain Officers***

 

On June 13, 2025, the Board of Directors approved and the Company granted to each of Sumit Kapur, the Company's Chief Executive Officer and Clark Golestani, the Company's sole director, a grant of 32,500,000 shares of restricted common stock. The restricted common stock vest in equal monthly installments for a two-year period beginning on the grant date, provided that if the Mr. Kapur is terminated by the Company other than for cause or Mr. Golestani is not re-elected by the shareholders, such vesting will accelerate and all unvested restricted common stock shall become fully vested.

***Series C Convertible Preferred Stock***

 

On July 18, 2025, the Company filed the Certificate of Designations of Preferences, Rights and Limitations of the Series C Convertible Preferred Stock of the Company with the Delaware Secretary of State designating and authorizing the issuance of up to 13,000 shares of Series C Convertible Preferred Stock. Subsequently, on November 4, 2025, the Company filed a Certificate of Amendment to the Certificate of Designations (the "Certificate of Amendment") to increase the number of authorized and designated shares of Series C Convertible Preferred Stock to 23,000 shares.

Each share of Series C Convertible Preferred Stock is convertible into 1,000 shares of common stock of the Company at the election of the holder, subject to certain adjustments and to beneficial ownership limitations. Each share of Series C Convertible Preferred Stock shall be entitled to vote with the Company's common stock on an as-converted basis, subject to beneficial ownership limitations. The holders of Series C Convertible Preferred Stock shall rank pari passu with the holders of common stock with respect to any liquidation, dissolution or winding up of the Company.

***Stock Options Issued to Certain Advisors***

 

On August 18, 2025, the Company granted 8,000,000 options each to two advisors with an exercise price of $0.002 per share. On August 27 and August 30, 2025, the Company granted an additional 8,500,000 options to two other advisors with an exercise price of $0.01 per share. The options vest as follows: (i) one-fourth of the options shall vest on the one-year anniversary of the grant date, and (ii) the remaining options shall vest monthly in equal monthly increments over the three-year period following the one-year anniversary of the grant date, provided that each vesting shall be subject to the recipient continuing to provide services to the Company as of the applicable vesting date. The options are also subject to accelerated vesting upon the occurrence of certain change of control events.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

***Change of the Company's Name***

 

On August 21, 2025, the Company changed its name to "Zapata Quantum, Inc.".

***August 2025 Warrants***

 

In August 2025 the Company entered into a warrant purchase agreement (the "Warrant Purchase Agreement") with accredited investor pursuant to which the Company sold and issued the warrants to purchase up to 1,200,000 shares of Common Stock ("August 2025 Warrants"). The August 2025 Warrants vests in equal monthly installments of 50,000 shares over a 24-month period beginning on the Commencement Date and subject to continued service to the Company on each vesting date. The August 2025 Warrants have an exercise price of $0.04 per share, subject to certain adjustments. The August 2025 Warrants cannot be settled in cash. The August 2025 Warrants may not be exercised to the extent that such exercise would cause the holder or its affiliates to beneficially own more than 4.99% of the Company's outstanding common stock immediately following the exercise.

***Appointment of Certain Officers and Compensatory Agreements of Certain Officers***

 ****

On October 8, 2025, the Company appointed Mr. William Klitgaard to the Board of Directors and named him as the sole member of the Audit Committee. In connection with his appointment, the Company granted Mr. Klitgaard the following compensation: (i) a grant of 1,000,000 five-year stock options, vesting in equal monthly increments over a two-year period, subject to continued services to the Company as of each applicable vesting date, with an exercise price of $0.08, (ii) cash compensation of $100 per year for services as director, and (iii) additional cash compensation of $25 per year for services as a chair of the Audit Committee of the Company, with both cash grants subject to Mr. Klitgaard's continued service to the Company as of each applicable payment date.

On October 9, 2025, the Company appointed Mr. Clark Golestani, a director, to serve as Chairman of the Board of Directors. In connection with his appointment, the Company granted Mr. Golestani 1,000,000 five-year stock options with an exercise price of $0.08, vesting in equal monthly increments over a two-year period, subject to Mr. Golestani's continued service to the Company as of each applicable vesting date.

On October 9, 2025, the Company appointed Mr. Sumit Kapur, Chief Executive Officer of the Company, to the Board of Directors. In connection with his appointment, the Company granted Mr. Kapur 1,000,000 five-year stock options with an exercise price of $0.08, vesting in equal monthly increments over a two-year period, subject to Mr. Kapur's continued service to the Company as of each applicable vesting date. On October 9, 2025, in connection with Mr. Kapur's services as Chief Executive Officer, the Company also granted Mr. Kapur 5,000,000 five-year stock options with an exercise price of $0.08, vesting in equal monthly installments over four years, subject to his continued services to the Company as of each applicable vesting date.

***Series A Convertible Preferred Stock***

 ****

In October and November 2025, the Company entered into securities purchase Agreements with accredited investors, pursuant to which the Company offered and sold 15,000 shares of the Company's Series A Convertible Preferred Stock at a purchase price of $100 per share for total gross proceeds of $1,500.

On October 23, 2025, the Company filed the Certificate of Designations of Preferences, Rights and Limitations (the "Certificate of Designations") of the Series A with the Delaware Secretary of State designating and authorizing the issuance of up to 15,000 shares of Series A Convertible Preferred Stock.

Each share of Series A is convertible into 1,000 shares of common stock of the Company at the election of the holder, subject to certain adjustments and to beneficial ownership limitations. Each share of Series A shall be entitled to vote with the Company's common stock on an as-converted basis, subject to beneficial ownership limitations. All shares of capital stock of the Company, both common stock and any other series of preferred stock, shall be junior in rank to all shares of Series A with respect to payments upon the liquidation, dissolution, and winding up of the Company.

***Forbearance Agreement***

On October 22, 2025, the Company entered into a forbearance agreement (the "Forbearance Agreement") with a third-party creditor related to outstanding invoices totaling approximately $3,168 (the "Overdue Amount"). Pursuant to the Forbearance Agreement, 50% of the Overdue Amount (approximately $1,584) was extinguished and replaced with contingent obligations (the "Contingent Obligations"). The Company agreed to pay up to two contingent payments, each equal to 25% of the Overdue Amount (approximately $792), upon the completion of capital-raising transactions generating at least $45 million and $55 million, respectively, in aggregate proceeds. If the specified financing thresholds are not achieved, the corresponding contingent payments will not become due, and the related obligations will be permanently extinguished.

**ZAPATA QUANTUM, INC.**<br>**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**<br>**(UNAUDITED)**<br>**(Dollar amounts in thousands, except per share and share amounts)**<br>

The remaining 50% of the Overdue Amount (approximately $1,584) (the "Remaining Overdue Amount," and together with the Contingent Obligations, the "Obligations") will continue to be owed, and the creditor has agreed to temporarily forbear from enforcing collection during the forbearance period.

Beginning May 1, 2025, any unpaid portion of the Obligations will accrue a late charge at a rate equal to the lesser of 0.8% per month or the maximum rate permitted by law. The forbearance period will terminate—and the Remaining Overdue Amount, together with any accrued late charges, will become immediately due and payable—upon the occurrence of certain "Forbearance Termination Events," including specified capital-raising or asset-sale transactions, defaults, or insolvency events.

**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.**

*You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks, uncertainties and assumptions. You should read the "Forward-Looking Statements" and "Risk Factors" sections of this Quarterly Report on Form 10-Q, which describe factors or events that could cause our actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. For periods prior to the closing of the Merger (as defined below), the use of "our," "we", the "Company" and words of similar import in this Item 2 refer to Zapata Quantum, Inc. ("Zapata", or "Legacy Zapata") or Andretti Acquisition Corp. ("AAC"), as the context requires.*

 

**Cautionary Note Regarding Forward-Looking Statements**

This Report contains forward-looking statements, including statements regarding our expectations for prospective future growth, operating results and financial condition, potential future trends and developments within our industry and the U.S. and global economies generally, plans and expectations for our future business plan and capital raising efforts, expectations and plans with respect to our products and services including the potential market for, timing, features, and demand for such products and services, and liquidity and sources of capital. Forward-looking statements are prefaced by words such as "anticipate," "expect," "plan," "could," "may," "will," "should," "would," "intend," "seem," "potential," "appear," "continue," "future," believe," "estimate," "forecast," "project," and similar words. We have based these forward-looking statements largely on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. We caution you, therefore, against relying on any of these forward-looking statements.

Our actual results may differ materially from those contemplated by the forward-looking statements for a variety of reasons, including, without limitation, the possibility that estimates, projections and assumptions on which the forward-looking statements are based prove to be incorrect, our ability to raise the necessary capital to re-establish material operations and generate revenue and the terms and timing of any related transactions, central bank interest rates and future interest rate changes, the risks arising from the impact of inflation, tariffs, the deterioration of the labor market of the United States, a recession which may result on the Company's business, prospective customers, and on the national and global economy, our ability to attract homeowners to our products and services, the potential for regulatory changes impacting quantum computing, artificial intelligence, data privacy and other areas that impact the Company's business, and the ability of us and third parties on which we depend to comply with applicable regulatory requirements, the risk that software and technology infrastructure on which we depend fail to perform as designed or intended, and the risks and uncertainties disclosed in our other reports and documents filed with the SEC. Any forward-looking statement made by us in this presentation speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

**Overview** 

Zapata Quantum, Inc., formerly known as Zapata Computing Holdings Inc., is a leading pure-play hardware-agnostic quantum software company. Following a strategic realignment in 2025, the Company will deliver subscription-based solutions to efficiently deploy and accelerate the development of quantum and hybrid quantum-classical computing applications. Founded in 2017 by researchers from a Harvard University Quantum Computing Lab, Zapata has built one of the industry's most robust intellectual property portfolios in quantum and hybrid quantum-classical computing and algorithmic methods, with over 60 patents, granted and pending, developed over eight years.

Zapata's software platform for quantum computing applications is based on our patented technology and supports a wide range of use cases in cryptography, pharmaceuticals, manufacturing, materials discovery and defense. The Company is the only organization to have participated across all technical areas of the Defense Advanced Research Projects Agency's ("DARPA")'s Quantum Benchmarking program and has worked with Fortune 500 enterprises and government agencies to unlock the potential of quantum computing.

Following a period of broader AI exploration, the Company undertook, in 2024 and 2025, a strategic realignment to refocus on its core quantum mission: developing the software and tooling layer that enables enterprises, governments, and researchers to harness quantum computing for economically meaningful outcomes.

In late 2024 the Company voluntarily elected to temporarily suspend its operations due to its limited capital resources and inability to access adequate liquidity to continue to fund its operations and meet its outstanding debt obligations. In June 2025, the Company commenced debt restructuring and capital raising transactions and the reinstatement of operations by (1) entering into exchange agreements with unsecured creditors pursuant to which such creditors agreed to exchange outstanding obligations payable to them for common stock and certain rights related thereto, and (2) the Company sold convertible notes and warrants for gross proceeds of $3 million. The Company has since been continuing efforts to negotiate and restructure outstanding obligations and raise capital. In the furtherance of recommencing operations, the Company has also entered into advisory agreements with third parties and agreed to compensate such parties in the form of equity and/or cash compensation. See Note 19, Subsequent Events in the notes to the unaudited condensed consolidated financial statements contained in this Report.

Zapata's hardware-agnostic approach and proprietary technology address the "software bottleneck" that limits quantum adoption. The Company's products - Orquestra, Bench-Q, Quantum Graph, and Quantum Pilot - provide the infrastructure and workflow tools that connect problem discovery, algorithm design, and hardware execution. These tools are supported by professional services, partnerships, and licensing programs that collectively form the Company's business model.

**Recent Developments**

***Merger with Andretti Acquisition Corp. ("AAC")***

 ****

On March 28, 2024, we completed our business combination with AAC, pursuant to which, among other things, Legacy Zapata became a wholly owned subsidiary of AAC (the "Merger"). For accounting purposes, the Merger was accounted for as a reverse recapitalization whereby Legacy Zapata was treated as the accounting acquirer and AAC was treated as the acquired company. For additional information regarding the Merger, refer to Note 3 in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

***Forward Purchase Agreement***

 

On March 25, 2024, we entered into the Forward Purchase Agreement with Sandia Investment Management LP, pursuant to which Sandia purchased, prior to the closing of the Merger, 1,000,000 shares of AAC's Class A Ordinary Shares from third parties through a broker in the open market (the "Recycled Shares") and, concurrently with the closing of the Merger, 500,000 shares of our common stock at a purchase price of $10.99 per share (the "Additional Shares").

In April 2024, Sandia exercised their optional early termination rights under the Forward Purchase Agreement, pursuant to which 250,000 shares were terminated and we received payments totaling $2.5 million under the early termination obligation prescribed in the Forward Purchase Agreement.

On October 8, 2024, we received notice from Sandia accelerating the Valuation Date to October 8, 2024. As a result, we became obligated to pay Sandia $2.4 million in cash or shares. In June 2025, we satisfied our obligations under the Forward Purchase Agreement through the issuance of 6,591,000 shares of common stock to Sandia.

For additional information regarding the Forward Purchase Agreement, refer to Note 7 in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

 **

***Enterprise Solution and Sponsorship Agreements with Andretti Global***

 **

One of AAC's affiliates, Andretti Autosport Holding Company, LLC ("Andretti Global") has preexisting contractual relationships with the Company. In February 2022, we entered into i) an enterprise solution subscription agreement and ii) a sponsorship agreement with Andretti Global, both of which expired on December 31, 2024. We considered that these agreements were executed prior to the business combination and were not executed in contemplation of the business combination. Accordingly, Andretti Global was not considered a related party prior to the consummation of the Merger.

On March 28, 2024, we entered into a sponsorship agreement with Andretti Autosport 1, LLC, an affiliate of Andretti Global. The agreement expired on December 31, 2024. Our committed future payments under the sponsorship agreement total $1.0 million.

On March 28, 2024, we entered into an Order Form under the February 2022 enterprise solution subscription agreement with Andretti Global. Pursuant to the agreement, Andretti Global agreed to pay us a total of $1.0 million, subject to our payment of the sponsorship fee to Andretti Autosport 1, LLC. Following the Operational Cessation, the agreement was terminated, and no payments were made.

For additional information regarding the Enterprise Solution and Sponsorship Agreements with Andretti Global, refer to Note 18 in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

***Purchase Agreements with Lincoln Park***

On December 19, 2023, we entered into a purchase agreement (the "2023 Purchase Agreement") with Lincoln Park Capital Fund, LLC ("Lincoln Park"), pursuant to which Lincoln Park agreed to purchase from us, at our option, an aggregate of up to $75.0 million of our common stock from time to time over a 36-month period following the Commencement Date, subject to certain limitations contained in the 2023 Purchase Agreement.

On August 13, 2024, we entered into a purchase agreement (the "2024 Purchase Agreement") with Lincoln Park, pursuant to which Lincoln Park agreed to purchase from us, at our option, an aggregate of up to $10.0 million of shares of our common stock from time to time over a 24-month period upon the satisfaction of certain conditions contained in the 2024 Purchase Agreement. In connection with the Operational Cessation described below, the registration statement in connection with the Purchase Agreement is no longer effective (which is a condition to transactions under the Purchase Agreement).

For additional information regarding the Purchase Agreements with Lincoln Park, refer to Note 10 in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

***Operational Cessation***

On October 7, 2024, our board of directors approved the cessation of our operations (the "Operational Cessation") due to insufficient financial resources to continue funding ongoing operations and meet existing obligations. In connection with the Operational Cessation, our board of directors approved the termination of all our employees, except for a small number of employees retained to administer termination business activities, including Sumit Kapur, our Chief Financial Officer. All such employees were terminated effective October 9, 2024. Following the Operational Cessation, we maintained minimal day-to-day operations.

On October 25, 2024, trading of our common stock and warrants was suspended and removed from the listing and registration on Nasdaq.

***Operations Prior to Operational Cessation***

Prior to the Operational Cessation, we offered specialized generative AI solutions which used techniques inspired by quantum physics and were tailored to solving complex industrial problems. These solutions combined software and related services and were subscription based. Our approach utilized mathematical techniques from the quantum physics community to make computation more efficient and to create models that have other advantages over conventional methods. Our primary target customers were enterprise organizations, which generally consist of large businesses that have high revenue, the size and resources to dominate a specific market and a significant number of employees.

We had a suite of three subscription-based specialized generative AI offerings that included software and software tools supported by services. These offerings consist of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Zapata AI Sense ("Sense"): A suite of algorithms and complex mathematical models to enhance analytics and other data-driven applications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Zapata AI Prose ("Prose"): Our set of generative AI solutions based on large language models ("LLMs"), similar to widely used generic chatbot applications but customized to an enterprise's industry and its unique problems.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Orquestra: The Company's specialized generative AI application development platform on which it provides Sense and Prose to customers.

***Restructuring Efforts***

As noted above, since the Operational Cessation, we have had minimal day-to-day operations. Management has since concentrated its efforts on restructuring activities aimed at restarting certain aspects of its core business, including capital-raising activities to improve our capital structure and to support the anticipated recommencement of business operations. For additional information regarding these restructuring activities, refer to Note 19, Subsequent Events, in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

Since our inception through March 31, 2025, we have financed our operations primarily through sales of our Convertible Preferred Stock and common stock and with issuances of Senior Notes and Senior Secured Notes. For the three months ended March 31, 2025 we have incurred net loss of $0.8 million. As of March 31, 2025 and December 31, 2024, we had an accumulated deficit of $128.4 million and $127.7 million, respectively.

Our ability to continue as a going concern is dependent upon our ability to raise capital through future equity or debt financing and generate profits from our operations. We are pursuing all available options for funding, which include seeking public or private investments and funding through the sale of equity or debt securities.

Subsequent to March 31, 2025, we raised an aggregate of $3.0 million through the issuance of Convertible Notes and $1.5 million through the sale of Series A Convertible Preferred Stock. The proceeds from the Convertible Notes were used to repay one of our outstanding Senior Secured Notes. In addition, in 2025, we entered into conversion agreements with certain creditors to settle approximately $11.7 million of liabilities through the issuance of shares of our common stock. These activities were undertaken as part of our ongoing efforts to improve the Company's capital structure and provide the liquidity necessary to support restarting certain aspects of our core business.

Although we believe that we will be able to continue to raise funds through the sale of our securities to provide the additional funding needed to meet our obligations, the restructuring activities aimed at restarting certain aspects of our core business will require substantial additional funding and there is no assurance that we will be able to continue raising the additional capital necessary to continue operations and execute on our business plan.

These factors raise substantial doubt about our ability to continue as a going concern.

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern. We have evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the consolidated financial statements are issued. We have incurred significant losses and negative cash flows from operations since the inception of Legacy Zapata in November 2017 and expects to continue to incur losses and negative cash flows for the foreseeable future as we expand our penetration of the quantum computing application development solutions market.

See "Liquidity and Capital Resources" below for additional information.

**Components of Our Results of Operations**

***Revenue***

Our revenue is generated primarily from sales of subscriptions to our software platform and related services. Subscriptions to our software platform are offered as stand-ready access to our cloud environment on an annual or multi-year basis. We may also offer consulting services in the form of stand-ready scientific and software engineering services, which are typically only offered in conjunction with our software platform. We evaluate our contracts at inception to determine if the terms represent a single, combined performance obligation or multiple performance obligations.

Under our consulting contracts, our deliverables may include integrated quantum, classical or hybrid quantum-classical computing solutions to our customers or to provide research and development services regarding the potential benefits of these solutions to use cases specified by our customer. Our subscription-based solutions consist of our commitment to provide access to our hosted software platform throughout the contract term along with stand-ready scientific and software engineering services.

Revenue from subscriptions to our software platform to date have only been sold as access to the platform in our hosted environment and are therefore recognized over the contract term on a ratable basis, as the commitment represents a stand-ready performance obligation.

Revenue from consulting services is generally recognized over the contract term as performance is completed on the performance obligations identified. Revenue from stand-ready scientific and engineering services are recognized over the contract term on a ratable basis, as the obligation represents a stand-ready obligation.

From time to time, we may enter into arrangements to build license applications that can be used in conjunction with our software platform. To date, the license application built has been delivered as a perpetual license with associated post-contract support. We recognize the license at the time of deployment, and the related post-contract support over the contracted service period on a ratable basis, as it is provided as a stand-ready service.

Our revenue recognition policies are discussed below under the heading "Critical Accounting Policies and Significant Judgments and Estimates" and Note 2, "Summary of Significant Accounting Policies" to our condensed consolidated financial statements, included elsewhere in this Quarterly Report.

***Cost of Revenue***

Cost of revenue includes expenses related to supporting product offerings. Our primary cost of revenue is personnel costs, including salaries and other personnel-related expense. Cost of revenue also includes costs relating to our information technology and systems, including depreciation, network costs, data center maintenance, database management and data processing costs. We allocate these overhead expenses based on headcount, and thus are reflected in cost of revenue and each operating expense category.

***Sales and Marketing***

Sales and marketing expenses consist primarily of personnel-related costs, including salaries and wages, benefits, commissions, bonuses and stock-based compensation expense for our employees engaged in sales and sales support, business development, marketing, corporate partnerships, and customer service functions. Sales and marketing expenses also include costs incurred for market research, tradeshows, branding, marketing, promotional expense, and public relations, as well as facilities and other supporting overhead costs, including depreciation and amortization. Sales and marketing expenses are primarily driven by investments in the growth of our business. We expect sales and marketing expenses, expressed as a percentage of revenue, to vary from period to period for the foreseeable future.

Advertising expenses, which are included in sales and marketing expense, primarily include promotional expenditures, and are expensed as incurred. The amounts incurred for advertising expenses for the three months ended March 31, 2025 and 2024 were $0 and $0.7 million, respectively.

***Research and Development***

Research and development expenses consist primarily of personnel-related costs, including salaries and wages, benefits, bonuses, and stock-based compensation expense for our scientists, engineers and other employees engaged in the research and development of our products. In addition, research and development expenses include third party software subscription costs, facilities and other supporting overhead costs, including depreciation and amortization. Research and development costs are expensed as incurred.

***General and Administrative Expenses***

General and administrative expenses consist primarily of personnel-related costs, including salaries and wages, bonuses, benefits, and stock-based compensation expense for our finance, legal, information technology, human resources, and other administrative personnel. General and administrative expenses also include facilities and supporting overhead costs, including depreciation and amortization, and external professional services.

***Other Expense, Net***

Other expense, net consists primarily of fair value adjustments related to our Senior Secured Notes and derivative contract in connection with our Forward Purchase Agreement, loss associated with amendments to capital markets advisory agreements, interest income, interest expense and foreign exchange gains and losses from our international operations.

***Income Taxes***

For the three months ended March 31, 2025 and 2024, the Company recorded an income tax provision of $0 and $6 thousand, respectively. These are related to income taxes from our foreign operations with pre-tax income generated from intercompany activities. We recorded a full valuation allowance of our net deferred tax asset position as of March 31, 2025 as we believe it was more likely than not that we would not be able to utilize our deferred tax assets.

**Results of Operations** 

***Comparison of the Three months Ended March 31, 2025 and 2024***

The following table summarizes our results of operations for the three months ended March 31, 2025 and 2024:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** | | |
|  | **2025** | **2024** |<br>**Change** |<br>**%** |
|  | **(in thousands)** | **(in thousands)** | | |
| Revenue ($0 and $433 from related parties, respectively) | $— | $1218 | $(1218) | -100% |
| Cost of revenue |  | 1052 | (1052) | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Gross profit |  | 166 | (166) | (100) |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Sales and marketing ($0 and $696 from related parties, respectively) |  | 1629 | (1629) | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development |  | 1407 | (1407) | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative | 680 | 2206 | (1526) | (69) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 680 | 5242 | (4562) | (87) |
| Loss from operations | (680) | (5076) | 4396 | (87) |
| Other income (expense): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (102) | (784) | 682 | (87) |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on issuance of forward purchase agreement<br> derivative liability |  | (4935) | 4935 | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Loss on issuance of senior secured notes |  | (9776) | 9776 | (100) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other (expense) income, net | 12 | (1743) | 1755 | (101) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expense, net | (90) | (17238) | 17148 | (99) |
| Net loss before income taxes | (770) | (22314) | 21544 | (97) |
| Provision for income taxes |  | (6) | 6 | (100) |
| Net loss | $(770) | $(22320) | $21550 | -97% |

---

***Revenue***

Revenue was $0 for the three months ended March 31, 2025, as compared to $1.2 million for the three months ended March 31, 2024. The decrease reflects the Operational Cessation.

***Cost of Revenue***

Cost of revenue was $0 for the three months ended March 31, 2025, as compared to $1.1 million for the three months ended March 31, 2024. The decrease reflects the Operational Cessation.

***Operating Expenses***

*Sales and Marketing Expenses* 

Sales and marketing expense was $0 for the three months ended March 31, 2025, as compared to $1.6 million for the three months ended March 31, 2024. The decrease reflects the Operational Cessation.

*Research and Development Expenses* 

Research and development expense was $0 for the three months ended March 31, 2025, as compared to $1.4 million for the three months ended March 31, 2024. The decrease reflects the Operational Cessation.

*General and Administrative Expenses* 

General and administrative expenses were $0.7 million for the three months ended March 31, 2025, compared to $2.2 million for the three months ended March 31, 2024. The decrease of $1.5 million reflects the Operational Cessation. Current-quarter expenses mainly consisted of insurance, software costs, salaries and benefits for remaining personnel, and legal and professional fees.

***Other Expense, Net***

Other expense, net was $0.1 million for the three months ended March 31, 2025, compared to $17.2 million for the three months ended March 31, 2024. The $17.1 million decrease primarily reflects the absence of prior year losses, which included a $9.8 million of loss on issuance of Senior Secured Notes, a $4.9 million of loss on the Forward Purchase Agreement, and a $1.8 million in transaction costs incurred related to the Lincoln Park Purchase Agreement. None of these costs were incurred during the first quarter of 2025. Interest expense also declined by $0.7 million due to the conversion of most Senior Notes to equity upon closing of the merger at the end of the first quarter of 2024.

***Provision for income taxes***

There was no provision for income taxes during the three months ended March 31, 2025. The provision for income taxes during the three months ended March 31, 2024 was not material and was related to our foreign operations.

**Liquidity, Going Concern and Capital Resources** 

Since our inception, we have financed our operations primarily with proceeds from sales of Convertible Preferred Stock and common stock and the issuance of Convertible Notes. As of March 31, 2025, we had cash and cash equivalents of $0.3 million. Since our inception through March 31, 2025, we have sold 14,222,580 shares of our Convertible Preferred Stock for aggregate net proceeds of $64.7 million, received $14.5 million from the issuance of Senior Notes and Senior Secured Notes and $8.6 million in proceeds under an equity line of credit. Our principal use of cash is to fund our operations and platform development to support our growth.

As of November 30, 2025, we had approximately $2.1 million in cash. We do not have sufficient capital to meet our working capital needs for the 12 months following the date we file this Report.

 ****

***Senior Secured Notes***

The Senior Secured Notes bear interest at the compound rate of 15% per annum and are convertible at the option of each noteholder in connection with the Merger at a conversion price of (i) $4.50 per share at the closing of the Merger or (ii) $8.50 per share at any time after the closing of the Merger. The outstanding principal amount of the Senior Secured Notes and all accrued but unpaid interest will be due and payable at the maturity date, December 15, 2026, unless otherwise converted. Upon the closing of the Merger, a portion of the aggregate outstanding Senior Secured Notes with an aggregate principal amount of $14.2 million and associated accrued interest of $0.5 million were converted into shares of our common stock and Senior Secured Notes with aggregate principal and accrued interest of $2.2 million remain outstanding as of March 31, 2025. While any Senior Secured Notes are outstanding, we cannot incur additional indebtedness for borrowed funds, except additional Senior Secured Notes, substantially similar notes or other debt instruments that are pari passu with or subordinate to the Senior Secured Notes.

***Notes Payable – Related Parties***

To finance transaction costs in connection with the Merger, the sponsor of AAC and certain of AAC's officers and directors made working capital loans (the "Notes Payable – Related Party") to AAC prior to the closing of the Merger. The Notes Payable – Related Party would either be repaid upon the consummation of the Merger, without interest, or at AAC's discretion, up to $1.5 million of such Notes Payable – Related Party could be converted into Private Placement Warrants at a price of $1.00 per warrant on the date of the Merger.

On March 28, 2024, the terms of the Notes Payable – Related Party were amended, pursuant to which the outstanding principal balance plus the accrued interest of $2.6 million, which was also due per its terms at the closing of the Merger was deferred and became due in monthly installments (including interest accruing from the closing of the Merger through the payment date) for twelve months thereafter beginning thirty days following the effectiveness of the Lincoln Park Registration Statement. The Lincoln Park Registration Statement was declared effective on April 18, 2024. Upon the closing of the Merger, none of the note holders elected to exercise their option of converting their respective loans into warrants. The Notes Payable – Related Party bear interest at a rate of 4.5% per annum. As of March 31, 2025, the outstanding balance of the Notes Payable – Related Party was $1.9 million within our condensed consolidated balance sheet.

 ****

***Lincoln Park Purchase Agreement***

On December 19, 2023, prior to the Merger, we entered into a Purchase Agreement with Lincoln Park pursuant to which Lincoln Park agreed to purchase from us, an aggregate of up to $75.0 million of common stock from time to time over a 36-month period following the closing of the Merger.

On August 13, 2024, we entered into the 2024 Purchase Agreement with Lincoln Park pursuant to which Lincoln Park agreed to purchase from us, an aggregate of up to $10.0 million of shares of common stock from time to time over a 24-month period upon the satisfaction of certain conditions contained in the 2024 Purchase Agreement.

In connection with the Operational Cessation described above, the registration statement in connection with the Purchase Agreement is no longer effective (which is a condition to transactions under the Purchase Agreement).

***Forward Purchase Agreement***

On March 25, 2024, we entered into the Forward Purchase Agreement with Sandia, pursuant to which Sandia purchased, from the open market, 1,000,000 Recycled Shares and 500,000 Additional Shares. In April 2024, Sandia elected to terminate the transaction in part by exercising the Optional Early Termination provision under the Forward Purchase Agreement, pursuant to which 250,000 shares were terminated. We received payments totaling $2.5 million under the Optional Early Termination provision prescribed in the Forward Purchase Agreement.

On October 8, 2024, we received notice from Sandia accelerating the Valuation Date to October 8, 2024. As a result, we became obligated to pay Sandia $2.4 million in cash or shares. In June 2025, we satisfied its obligations under the Forward Purchase Agreement through the issuance of 6,591,000 shares of our common stock to Sandia.

***Cash Flows***

The following table summarizes our sources and uses of cash for each of the periods presented:

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended March 31,** | **Three Months Ended March 31,** |
|  | **2025** | **2024** |
|  | **(in thousands)** | **(in thousands)** |
| Net cash used in operating activities | $(59) | $(2147) |
| Net cash used in investing activities |  | (11) |
| Net cash provided by financing activities |  | 6096 |
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (12) | (19) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net (decrease) increase in cash, cash equivalents and restricted cash | $(71) | $3919 |

---

*Operating Activities* 

Net cash used in operating activities was $59 thousand for the three months ended March 31, 2025. Operating cash flows reflected a net loss of $0.8 million, partially offset by $0.6 million in non-cash charges and a $0.1 million net change in working capital. Non-cash charges included $0.5 million in non-cash interest expense, and $44 thousand in stock-based compensation. Changes in working capital was driven by a $48 thousand increase in accounts payable and a $94 thousand decrease in prepaid expenses and other current and non-current assets. As previously disclosed, we ceased operations in October 2024, resulting in limited activities during the quarter.

Net cash used in operating activities was $2.1 million for the three months ended March 31, 2024. The factors affecting our operating cash flows during this period were our net loss of $22.3 million, partially offset by a net change in our operating assets and liabilities of $2.5 million and non-cash charges of $17.36 million. The non-cash charges primarily consisted of $9.8 million in loss on issuance of Senior Secured Notes, $0.2 million in stock-based compensation expense, $0.8 million in non-cash interest expense, $0.2 million in non-cash vendor payments, $0.1 million in non-cash lease expense, $1.7 million in equity line of credit commitment expense, and $4.9 million in the loss on the forward purchase contract. The change in operating assets and liabilities was driven by a $2.1 million increase in accounts payable, a $0.8 million decrease in accounts receivable, a $0.7 million increase in prepaid expenses and other current and non-current assets, a $0.6 million increase in accrued expenses and other current liabilities, a $0.1 million decrease in deferred revenue and a $0.1 million decrease in operating lease liabilities. The decrease in accounts receivable is due to the timing of billings and collections from customer contracts. The increase in accounts payable was primarily related to the increase in transaction costs and the timing of invoicing and payments of sponsorship fees and professional services fees. The increase in prepaid expenses and other current and non-current assets was primarily due to the timing of vendor invoicing and payments for sponsorship fees. The increase in accrued expenses and other current liabilities is primarily due to an increase in accrued legal and audit fees and an increase in accrued bonus costs, offset by the payment of sponsorship fees. The decrease in deferred revenue is due to the timing of billings related to customer contracts and the recognition of revenue from customer contracts. The decrease in operating lease liabilities resulted primarily from lease payments.

*Investing Activities* 

There were no cash flows from investing activities during the three months ended March 31, 2025.

During the three months ended March 31, 2024, net cash used in investing activities was $11 thousand, primarily consisting of purchases of property and equipment. The purchases of equipment during these periods were primarily related to computer equipment purchases.

*Financing Activities* 

There were no cash flows from financing activities during the three months ended March 31, 2025.

During the three months ended March 31, 2024, net cash provided by financing activities was $6.1 million, which consisted of $12.6 million in proceeds from the closing of the Merger, $5.9 million in proceeds received from the issuance of Senior Secured Notes, and $0.1 million in proceeds from exercises of stock options, partially offset by the payment of $1.5 million of deferred offering costs and the prepayment of $11.0 million under the Forward Purchase Agreement.

**Recent Financing and Restructuring Transactions**

For a description of certain capital raising and restructuring activities we have conducted in 2025, see Note 19, Subsequent Events notes to the unaudited condensed consolidated financial statements contained in this Report.

**Off-Balance Sheet Financing Arrangements** 

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements during the periods presented. Zapata and Legacy Zapata have not entered into any off-balance sheet financing agreements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

**Contractual Obligations and Other Commitments** 

As of March 31, 2025, there have been no material changes with regard to contractual obligations from those disclosed in our "Management's Discussion and Analysis on Financial Condition and Results of Operations—Contractual Obligations and Other Commitments" in our Annual Report on Form 10-K for the year ended December 31, 2024.

**Critical Accounting Policies and Significant Judgments and Estimates**

There have been no material changes to our critical accounting policies from those disclosed in the "Management's Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Significant Judgments and Estimates" section of our Annual Report on Form 10-K for the year ended December 31, 2024.

**Recently Issued and Adopted Accounting Pronouncements** 

A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our condensed consolidated financial statements, which are included elsewhere in this Report.

**Emerging Growth Company Status** 

Zapata Quantum Inc. qualifies as an "emerging growth company," as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). Pursuant to the JOBS Act, an emerging growth company is provided the option to adopt new or revised accounting standards that may be issued by Financial Accounting Standards Board ("FASB") or the SEC either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. We intend to take advantage of the exemption for complying with new or revised accounting standards within the same time periods as private companies. Accordingly, the information contained herein may be different than the information you receive from other public companies. We also intend to take advantage of some of the reduced regulatory and reporting requirements applicable to emerging growth companies pursuant to the JOBS Act so long as it qualifies as an emerging growth company, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation and exemptions from the requirements of holding non-binding advisory votes on executive compensation and golden parachute payments.

**Item 3. Quantitative and Qualitative Disclosures About Market Risk.**

Not applicable.

**Item 4. Controls and Procedures.**

**Disclosure Controls and Procedures**

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the "SEC"). Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of March 31, 2025, have concluded that, based on such evaluation, our disclosure controls and procedures were not effective due to the material weaknesses described below.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis. Management has identified the following material weaknesses which have caused management to conclude that, as of March 31, 2025, our disclosure controls and procedures were not effective:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Company does not have sufficient segregation of duties within accounting functions, as its Chief
Executive Officer is the sole officer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Company does not have sufficient or complete written documentation of our internal controls policies
and procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• A substantial portion of the Company's financial reporting is carried out by an outside accounting
firm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Company's human resources, processes and systems are not sufficient to enable the production
of timely and accurate financial statements in accordance with US GAAP.

**Plans for Remediation of Material Weaknesses**

Management has taken actions to remediate the deficiencies in its internal controls over financial reporting and implemented additional processes and controls designed to address the underlying causes associated with the above-mentioned material weaknesses. Management is committed to finalizing the remediation of the material weaknesses. Management's internal control remediation efforts include the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We are currently in the process of identifying and engaging
internal control consultants to assist us in performing a risk assessment as well as identifying and designing a system of internal controls
necessary to mitigate the risks identified, including preparation of written documentation and testing of our internal control policies
and procedures, such that we are able to perform a Section 404 analysis of our internal control over financial reporting when and as required;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We plan to increase our personnel resources and technical
accounting expertise within the accounting function to replace our outside service providers; until we have sufficient technical accounting
and financial reporting capabilities, we have retained an accounting consulting firm to provide support and to assist us in our evaluation
of more complex applications of U.S. GAAP and assist us with financial reporting.

**Changes in Internal Control Over Financial Reporting**

Other than with respect to the ongoing remediation efforts on the material weaknesses, there were no changes in our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**Limitations of the Effectiveness of Internal Controls**

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the internal control system are met. Because of the inherent limitations of any internal control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.

**PART II—OTHER INFORMATION**

**Item 1. Legal Proceedings.** 

From time to time, we may be involved in litigation that arises through the normal course of business. As of the date of this filing, we are not aware of any material legal proceedings to which we or any of our subsidiaries is a party or to which any of our property is subject, nor are we aware of any such threatened or pending litigation or any such proceedings known to be contemplated by governmental authorities. We are not aware of any material proceedings in which any of our directors, officers, or affiliates or any registered or beneficial stockholder of more than 5% of our common stock, or any associate of any of the foregoing, is a party adverse to or has a material interest adverse to, us or any of our subsidiaries.

**Item 1A. Risk Factors.** 

Not applicable for smaller reporting companies.

**Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities.**

None.

**Item 3. Defaults Upon Senior Securities.**

During the fourth quarter of 2024, an event of default occurred under the Company's Senior Secured Promissory Notes issued pursuant to the Senior Secured Note Purchase Agreement dated December 15, 2023. Under the terms of these notes, the Company's Current Report on Form 8-K filed on October 11, 2024, in which the Company disclosed that, at that time, it was unable to, and unlikely to become able to, satisfy all of its financial obligations, constituted an event of default. As a result, all amounts outstanding under the Senior Secured Promissory Notes became immediately due and payable.

As of November 30, 2025, the Company has repaid approximately $1 million of principal, together with accrued interest, and has cured the event of default with respect to the remaining principal balance and accrued interest under the Senior Secured Promissory Notes. No Senior Secured Promissory Notes, or other Senior Securities, remain in default as of the filing date of this report.

**Item 4. Mine Safety Disclosures.**

Not applicable.

**Item 5. Other Information.**

During the three months ended March 31, 2025, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or any "non-Rule 10b5-1 arrangement" as defined in Item 408(c) of Regulation S-K.

**Item 6. Exhibits.** 

**EXHIBIT INDEX** 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | | **Incorporated by Reference** | **Incorporated by Reference** | **Incorporated by Reference** |
| <br>**Exhibit**<br> **No.** | <br>**Description** | <br>**Filed/Furnished**<br> **Herewith** | **Form** | **Exhibit**<br> **No.** | **Filing**<br> **Date** |
| 2.1 | [Business Combination Agreement, dated as of September 6, 2023, by and among the Company, Tigre Merger Sub, Inc. and Legacy Zapata](https://www.sec.gov/Archives/edgar/data/1843714/000119312523229092/d539142dex21.htm) |  | 8-K | 2.1 | 9/6/23 |
| 3.1 | [Certificate of Incorporation](https://www.sec.gov/Archives/edgar/data/1843714/000119312524085161/d13242dex31.htm) |  | 8-K | 3.1 | 4/3/24 |
| 3.2 | [Bylaws of Zapata Computing Holdings Inc.](https://www.sec.gov/Archives/edgar/data/1843714/000119312524085161/d13242dex32.htm) |  | 8-K | 3.2 | 4/3/24 |
| 31.1 | [Certification of the Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ex31x1.htm) | (1) |  |  |  |
| 31.2 | [Certification of the Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ex31x2.htm) | (1) |  |  |  |
| 32.1 | [Certification of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](ex32x1.htm) | (2) |  |  |  |
| 101.INS | Inline XBRL Instance Document | (1) |  |  |  |
| 101.SCH | Inline XBRL Taxonomy Extension Schema | (1) |  |  |  |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | (1) |  |  |  |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | (1) |  |  |  |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | (1) |  |  |  |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | (1) |  |  |  |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). | (1) |  |  |  |

---

---

| | |
|:---|:---|
| +<br>| Certain schedules, appendices and exhibits to this agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the SEC Staff upon request.<br>|
| # | Indicates management contract or compensatory plan, contract or agreement. |
| (1) | Filed herein |
| (2) | Furnished herein. |

---

**SIGNATURES**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **ZAPATA QUANTUM, INC.** | **ZAPATA QUANTUM, INC.** |
| December 9, 2025 | By: | */s/ Sumit Kapur* |
|  |  | Sumit Kapur |
|  |  | Chief Executive Officer, Chief Financial Officer |
|  |  | (Principal Executive Officer) |

---

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER**

I, Sumit Kapur, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Zapata Quantum, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: December 9, 2025

---

| |
|:---|
| */s/ Sumit Kapur* |
| Sumit Kapur |
| Chief Executive Officer |
| (Principal Executive Officer) |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER**

I, Sumit Kapur, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Zapata Quantum, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: December 9, 2025

---

| |
|:---|
| */s/ Sumit Kapur* |
| Sumit Kapur |
| Chief Financial Officer |
| (Principal Financial Officer) |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the quarterly report of Zapata Quantum, Inc. (the "Company") on Form 10-Q for the quarter ended March 31, 2025, as filed with the Securities and Exchange Commission on the date hereof, I, Sumit Kapur, certify, pursuant to 18 U.S.C. Sec.1350, as adopted pursuant to Sec.906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1. The quarterly report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and

2. The information contained in the quarterly report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| |
|:---|
| */s/ Sumit Kapur* |
| Sumit Kapur |
| Chief Executive Officer and Chief Financial Officer |
| (Principal Executive Officer and Principal Financial Officer) |

---

Dated: December 9, 2025