CWGL

Statements included in this Quarterly Report on Form 10-Q (this “Report”) may contain forward-looking statements. See “Cautionary Statement for Forward-Looking Information” below. The following should be read in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 as filed with the SEC (the “2025 Report”) on March 17, 2026. Quantities or results referred to as “current quarter” and “current three and six-month period” refer to the three and six months ended June 30, 2026. Cautionary Statement for Forward-Looking Information This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other parts of this Report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The unaudited interim condensed consolidated financial statements, which include results of Crimson Wine Group, Ltd. and all of its subsidiaries, collectively known as “we”, “Crimson”, “our”, “us”, or “the Company”, have been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information and with the general instruction for quarterly reports filed on Form 10-Q and Article 8 of Regulation S-X. All statements, other than statements of historical fact constitute “forward-looking statements” and represent current expectations, estimates, assumptions, and projections of future events. The words “may,” “will,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “potential,” or “continue” and similar types of expressions identify such statements, although not all forward-looking statements contain these identifying words. Forward-looking statements include, but are not limited to, those relating to the Company’s future results of operations, financial condition and performance; plans; objectives; strategy; business; operations and facilities; seasonality; opportunities; and trends relating to the Company’s industry. Forward-looking statements also include expectations about the future benefits of the Company’s acquisitions, such as the expectation that the acquisition of the Raeburn Assets provide the Company with a strategic opportunity to expand its portfolio. These statements are based upon information that is currently available to the Company and its management’s current expectations speak only as of the date hereof and are subject to risks and uncertainties. The Company expressly disclaims any obligation, except as required by federal securities laws, or undertaking to update or revise any forward-looking statements contained herein to reflect any change or expectations with regard thereto or to reflect any change in events, conditions, or circumstances on which any such forward-looking statements are based, in whole or in part. The Company’s actual results may differ materially from the results discussed in or implied by such forward-looking statements. Risks that could cause actual results to differ materially from any results projected, forecasted, estimated, or budgeted or that may materially and adversely affect the Company’s actual results include, but are not limited to, those discussed in Part I, “Item 1A. Risk Factors” of the 2025 Report and in Part II, “Item 1A. Risk Factors” of this Report. Readers should carefully review the risk factors described in the 2025 Report and this Report, and in other documents that the Company files from time to time with the SEC. Overview of Business The Company generates revenues from sales of wine to wholesalers and direct to consumers, sales of bulk wine and grapes, custom winemaking services, special event fees, tasting fees and other non-wine retail sales such as merchandise. The Company’s wines are primarily sold to wholesale distributors, who then sell to retailers and restaurants. The Company sells wine (through distributors and directly) to restaurants, bars, and other hospitality locations (“On-Premise”). The Company also sells wine (through distributors and directly) to supermarkets, grocery stores, liquor stores, and other chains, third-party Ecommerce and independent stores (“Off-Premise”). As permitted under federal, state and local regulations, the Company has increased its emphasis on generating revenue from direct sales to consumers, which occur through wine clubs, at the wineries’ tasting rooms, and through the Ecommerce channel. Direct sales to consumers are more profitable for the Company as it is able to sell its products at a price closer to retail prices rather than the wholesale price sold to distributors. From time to time, the Company may sell grapes or bulk wine because the grapes or wine do not meet the quality standards for its products, market condition changes resulting in reduced demand for certain products, or because the Company may have produced more of a particular varietal than it can use. When these sales occur, they may result in a loss. Cost of sales includes grape and bulk wine costs, whether purchased or produced from the Company’s controlled vineyards, crush costs, winemaking and processing costs, bottling, packaging, warehousing, and shipping and handling costs. For the Company’s produced grapes, grape costs include annual farming costs, harvest costs, and depreciation of vineyard assets. For 22 Table of Contents wines that age longer than one year, winemaking and processing costs continue to be incurred and capitalized to the cost of wine, which can range from three to 36 months. Reductions to the carrying value of inventories are also included in cost of sales. As of June 30, 2026, wine inventory included approximately 1.0 million cases of bottled wine and bulk wine, both in various stages of the aging process. Cased wine is expected to be sold over the next 12 to 36 months and generally before the release date of the next vintage. Seasonality As discussed in Part I, “Item 1. Business” of the 2025 Report, the wine industry in general historically experiences seasonal fluctuations in revenues and net income. The Company typically has lower sales and net income during the first quarter and higher sales and net income during the fourth quarter due to seasonal holiday buying as well as wine club shipment timing. The Company anticipates similar trends in the future but will monitor and provide updates if the acquisition of the Raeburn Assets significantly impacts these trends for the remainder of 2026 and beyond. Shipments versus Depletions Within the wholesale segment, shipments represent the quantity of wine sold to the distribution channel (such as wholesale distributors and retailers). The Company recognizes revenue for wholesale orders upon shipment of the wine from the Company’s third-party warehouse facilities. See Note 3, “Revenue,” of this Report for additional information on the Company’s revenue recognition policy. Within the industry, depletions is a measurement used to capture the quantity of wine sold from distributors to retailers. Shipments can vary from depletions depending on the timing and inventory management decisions by the distributors and retailers. Climate Conditions and Extreme Weather Events Winemaking and grape growing are subject to a variety of agricultural risks. Various diseases, pests, natural disasters, and certain climate conditions can materially and adversely affect the quality and quantity of grapes available to Crimson thereby materially and adversely affecting the supply of Crimson’s products and its profitability. Given the risks presented by climate conditions and extreme weather, Crimson regularly evaluates impacts of climate conditions and weather on its business to disclose any material impacts on the business. Along with various insurance policies currently in place, Crimson has made investments to improve its climate resilience and strives to effectively manage grape sourcing to help mitigate the impact of climate change and unforeseen natural disasters. Crimson continues to complete upgrades to its facilities to improve water and energy resiliency and fire mitigation measures with plans to advance these initiatives over the next several years. However, we cannot guarantee that such efforts will successfully mitigate any damage from a catastrophic event. See “We may not be fully insured against risk of catastrophic loss to wineries, production facilities or distribution systems as a result of earthquakes, fires, floods or other events, some of which may be exacerbated by climate change, which may cause us to experience a material financial loss” under Part I, “Item 1A. Risk Factors” of the 2025 Report. Inflation, Tariffs and Market Conditions The Company expects profit margins to remain steady or increase if it is able to effectively manage cost of sales and operating expenses, subject to any volatility in the bulk wine markets, increased labor costs, increased commodity costs, including dry goods and packaging materials, and increased transportation costs. The Company continues to monitor the impact of inflation and tariffs in an attempt to minimize its effects through pricing strategies and cost reductions. If, however, the Company’s operations are impacted by significant inflationary pressures and/or tariffs, it may not be able to completely offset increased costs through price increases on its products, negotiations with suppliers, cost reductions, or production improvements. Due to trade tensions between the U.S. and Canada, shipments of the Company’s wines were suspended to Canada from the end of the first quarter throughout the second quarter of 2025. While export wine sales began to slowly resume in certain Canadian markets during the second half of 2025, the Company cannot predict when trade tensions will be reduced or whether demand will return to levels observed prior to 2025. See “We are subject to risks from changes to the trade policies, regulations, and tariffs of the U.S. and foreign governments” under Part I, “Item 1A. Risk Factors” of the 2025 Report. The Company maintains an allowance for credit losses for estimated losses resulting from the inability of its customers to make required payments. As of the date of this Report, the Company was aware that one of its key distributors was engaged in ongoing negotiations to explore divestiture options in key markets in which the Company operates. In July 2026, the same 23 Table of Contents distributor filed for voluntary chapter 11 bankruptcy to pursue potential sale transactions and implement an orderly wind down of its remaining operations. Certain joint ventures affiliated with this distributor in key markets are not included in the chapter 11 filing. As of June 30, 2026, amounts due from this distributor totaled approximately $2.3 million of net accounts receivable, while amounts owed by the Company to the distributor totaled $1.1 million in accounts payable and accrued liabilities. Based on the Company’s reserve policy, no reserve has been recognized with respect to these amounts. The Company cannot predict the outcome of the negotiations with the distributor and any bankruptcy proceedings. Consequently, changes in the accounts receivable deemed collectible or the net financial exposure from this distributor could have a material impact on the Company’s consolidated financial position, liquidity or results of operations. 24 Table of Contents Results of Operations Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025 Net Sales Three Months Ended June 30, (in thousands, except percentages) 2026 2025 Increase (Decrease) % change Wholesale $ 13,567 $ 9,800 $ 3,767 38% Direct to Consumer 5,990 6,305 (315) (5)% Other 916 896 20 2% Total net sales $ 20,473 $ 17,001 $ 3,472 20% Wholesale net sales increased $3.8 million, or 38%, in the current quarter as compared to the same quarter in 2025, with domestic wine sales primarily driving this increase as export wine sales were comparable to the prior year quarter. The increase in domestic wine sales was due primarily to shipments of Raeburn wines in the current quarter as the Company acquired the Raeburn Assets on February 9, 2026. Partially offsetting the overall increase in domestic wine sales was a net decrease in shipments of other brands in the current quarter versus the prior year quarter, related to timing of distributor orders and transitions. Direct to Consumer net sales decreased $0.3 million, or 5%, in the current quarter as compared to the same quarter in 2025. The overall decrease was driven by reduced memberships within the wine clubs and lower average spend per guest through the tasting rooms. Performance within these channels remained challenged amid weakening market conditions and continued pressure on discretionary consumer spending. Other net sales, which include bulk wine and grape sales, custom winemaking services, event fees, tasting fees and non-wine retail sales in the current quarter were comparable to the same quarter in 2025. 25 Table of Contents Gross Profit Three Months Ended June 30, (in thousands, except percentages) 2026 2025 Increase (Decrease) % change Wholesale $ 4,906 $ 3,713 $ 1,193 32% Wholesale gross margin percentage 36 % 38 % Direct to Consumer 3,780 4,202 (422) (10)% Direct to Consumer gross margin percentage 63 % 67 % Other (65) (164) 99 60% Total gross profit $ 8,621 $ 7,751 $ 870 11% Total gross margin percentage 42 % 46 % Wholesale gross profit increased $1.2 million, or 32%, in the current quarter as compared to the same quarter in 2025 driven by an increase in overall shipments. Wholesale gross margin percentage, which is defined as wholesale gross profit as a percentage of wholesale net sales, decreased 173 basis points in the current quarter as compared to the same quarter in 2025 primarily driven by the step-up in cost basis for the acquired Raeburn inventory. During the current quarter, the step-up in cost basis recognized through cost of sales on the sales of acquired Raeburn inventory reduced total wholesale margins by 631 basis points. The increase in cost basis was a result of the purchase price allocation performed at acquisition and will continue to have a negative impact on wholesale margins until the Company sells through the acquired inventory. See Note 2, “Acquisition of Raeburn Assets,” included in Part I, Item 1 of this Report for additional information. Direct to Consumer gross profit decreased $0.4 million, or 10%, in the current quarter as compared to the same quarter in 2025 driven by a decrease in overall case volume. Direct to Consumer gross margin percentage decreased 354 basis points due to an unfavorable sales mix for wine club shipments in the current quarter as compared to the same quarter in 2025. “Other” includes gross profit (loss) on bulk wine and grape sales, custom winemaking services, event fees, tasting fees, non-wine retail sales, and inventory write-downs. Losses decreased $0.1 million, or 60%, in the current quarter as compared to the same quarter in 2025 driven by improved profitability on sales of bulk wine. Operating Expenses Three Months Ended June 30, (in thousands, except percentages) 2026 2025 Increase (Decrease) % change Sales and marketing $ 4,413 $ 4,484 $ (71) (2)% General and administrative 4,113 3,672 441 12% Total operating expenses $ 8,526 $ 8,156 $ 370 5% Sales and marketing expenses decreased $0.1 million, or 2%, in the current quarter as compared to the same quarter in 2025 primarily driven by a decrease in accrued compensation. General and administrative expenses increased $0.4 million, or 12%, in the current quarter as compared to the same quarter in 2025 due primarily to expenses relating to the integration of the Raeburn Assets into the Company’s operations. 26 Table of Contents Other Income (Expense), Net Three Months Ended June 30, (in thousands, except percentages) 2026 2025 Change % change Interest expense, net $ (546) $ (62) $ (484) (781)% Other income, net 49 266 (217) (82)% Total other (expense) income, net $ (497) $ 204 $ (701) (344)% Interest expense, net in the current quarter increased in comparison to the same quarter in 2025 due to additional interest incurred on the borrowings against the Revolving Credit Facility in connection with the acquisition of the Raeburn Assets. See Note 9, “Debt,” included in Part I, Item 1 of this Report for additional information. Other income, net, decreased $0.2 million, or 82%, in the current quarter compared to the same quarter in 2025 primarily driven by a decrease of interest income earned in line with lower balances of money market mutual funds and other investments following the acquisition of the Raeburn Assets. Income Tax Benefit The Company’s effective tax rates for the three months ended June 30, 2026 and 2025 were 24.9% and 45.3%, respectively. The decrease in the Company’s effective tax rate is primarily attributable to an immaterial change in the estimated 2025 annual effective income tax rate having an outsized adjusting impact on the prior year quarter. 27 Table of Contents Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025 Net Sales Six Months Ended June 30, (in thousands, except percentages) 2026 2025 Increase (Decrease) % change Wholesale $ 25,827 $ 17,699 $ 8,128 46% Direct to Consumer 11,545 12,282 (737) (6)% Other 1,365 1,480 (115) (8)% Total net sales $ 38,737 $ 31,461 $ 7,276 23% Wholesale net sales increased $8.1 million, or 46%, in the current six-month period as compared to the same period in 2025, with domestic wine sales primarily driving the increase as export wine sales were comparable to the prior year period. The increase in domestic wine sales was due primarily to the shipments of Raeburn wines in the current six-month period as the Company acquired the Raeburn Assets on February 9, 2026. Wine sales of other brands were comparable between the current six-month period and the prior year period. Direct to Consumer net sales decreased $0.7 million, or 6%, in the current six-month period as compared to the same period in 2025. The overall decrease was driven by reduced memberships within the wine clubs and lower average spend per guest through the tasting rooms. Performance within these channels remained challenged amid weakening market conditions and continued pressure on discretionary consumer spending. Other net sales, which include bulk wine and grape sales, custom winemaking services, event fees, tasting fees and non-wine retail sales, decreased $0.1 million, or 8%, in the current six-month period as compared to the same period in 2025. The decrease was primarily driven by lower revenue generated from custom winemaking services in the current six-month period as compared to the same period in 2025. 28 Table of Contents Gross Profit Six Months Ended June 30, (in thousands, except percentages) 2026 2025 Increase (Decrease) % change Wholesale $ 9,706 $ 7,067 $ 2,639 37% Wholesale gross margin percentage 38 % 40 % Direct to Consumer 7,470 8,124 (654) (8)% Direct to Consumer gross margin percentage 65 % 66 % Other (642) (792) 150 19% Total gross profit $ 16,534 $ 14,399 $ 2,135 15% Total gross margin percentage 43 % 46 % Wholesale gross profit increased $2.6 million, or 37%, in the current six-month period as compared to the same period in 2025 driven by an increase in overall shipments. Wholesale gross margin percentage, which is defined as wholesale gross profit as a percentage of wholesale net sales, decreased 235 basis points in the current six-month period as compared to the same period in 2025 primarily driven by the step-up in cost basis for the acquired Raeburn inventory. During the current six-month period, the step-up in cost basis recognized through cost of sales on the sales of acquired Raeburn inventory reduced total wholesale margins by 564 basis points. The increase in cost basis was a result of the purchase price allocation performed at acquisition and will continue to have a negative impact on wholesale margins until the Company sells through the acquired inventory. See Note 2, “Acquisition of Raeburn Assets,” included in Part I, Item 1 of this Report for additional information. Direct to Consumer gross profit decreased $0.7 million, or 8%, in the current six-month period as compared to the same period in 2025 driven by a decrease in overall case volume. Direct to Consumer gross margin percentage decreased 144 basis points due to an unfavorable sales mix for wine club shipments in the current six-month period as compared to the same period in 2025. “Other” includes gross profit (loss) on bulk wine and grape sales, custom winemaking services, event fees, tasting fees, non-wine retail sales, and inventory write-downs. Losses decreased $0.2 million, or 19%, in the current six-month period as compared to the same period in 2025 driven by improved profitability on sales of bulk wine. Operating Expenses Six Months Ended June 30, (in thousands, except percentages) 2026 2025 Increase (Decrease) % change Sales and marketing $ 8,498 $ 8,710 $ (212) (2)% General and administrative 8,529 7,640 889 12% Total operating expenses $ 17,027 $ 16,350 $ 677 4% Sales and marketing expenses decreased $0.2 million, or 2%, in the current six-month period as compared to the same period in 2025 primarily driven by a decrease in accrued compensation. General and administrative expenses increased $0.9 million, or 12%, in the current six-month period as compared to the same period in 2025 due primarily to expenses relating to the integration of the Raeburn Assets into the Company’s operations. 29 Table of Contents Other Income (Expense), Net Six Months Ended June 30, (in thousands, except percentages) 2026 2025 Change % change Interest expense, net $ (1,002) $ (289) $ (713) (247)% Other income, net 220 741 (521) (70)% Total other (expense) income, net $ (782) $ 452 $ (1,234) (273)% Interest expense, net, increased $0.7 million, or 247%, in the current six month period in comparison to the same period in 2025 due to additional interest incurred on the borrowings against the Revolving Credit Facility in connection with the acquisition of the Raeburn Assets. See Note 9, “Debt,” included in Part I, Item 1 of this Report for additional information. Other income, net, decreased $0.5 million, or 70%, in the current six-month period compared to the same period in 2025 primarily driven by a decrease of interest income earned in line with lower balances of money market mutual funds and other investments following the acquisition of the Raeburn Assets. Income Tax Benefit The Company’s effective tax rates for the six months ended June 30, 2026 and 2025 were 26.3% and 30.3%, respectively. The difference between the effective income tax rates was primarily attributable to state income taxes and other permanent items. 30 Table of Contents Liquidity and Capital Resources General The Company’s principal sources of liquidity are its available cash and cash equivalents, investments in available for sale securities, funds generated from operations and bank borrowings. The Company’s primary cash needs are to fund working capital requirements and capital expenditures. The Company believes that cash flows generated from operations and its cash, cash equivalents, and marketable securities balances, as well as its borrowing arrangements, will be sufficient to meet its presently anticipated cash requirements for capital expenditures, working capital, debt obligations and other commitments during the next twelve months. Revolving Credit Facility In March 2013, Crimson and its subsidiaries entered into a $60.0 million revolving credit facility (the “Revolving Credit Facility”) with American AgCredit, FLCA (“American AgCredit”), as agent for the lenders. The Revolving Credit Facility is comprised of a revolving loan facility (the “Revolving Loan”) and a term revolving loan facility (the “Term Revolving Loan”), which together are secured by substantially all of Crimson’s assets. On June 15, 2023, the Company executed a fifth amendment to the Revolving Credit Facility with American AgCredit, which extended the termination date of the Revolving Loan and the Term Revolving Loan to May 31, 2028 along with updates to other terms of the Revolving Credit Facility. The Revolving Loan is for up to $10.0 million of availability in the aggregate for a five year term, and the Term Revolving Loan is for up to $50.0 million in the aggregate for a fifteen year term. In addition to unused line fees ranging from 0.125% to 0.225%, rates for the borrowings are priced based on a performance grid tied to certain financial ratios and the Term Secured Overnight Financing Rate. The Revolving Credit Facility can be used to fund acquisitions, capital projects, and other general corporate purposes. Covenants include the maintenance of specified debt and equity ratios, limitations on the incurrence of additional indebtedness, limitations on dividends and other distributions to stockholders and restrictions on certain mergers, consolidations, and sales of assets. In connection with the acquisition of the Raeburn Assets in February 2026, the Company borrowed an aggregate of $29.0 million under the Revolving Credit Facility. Since then, the Company has paid down a total of $7.0 million through June 30, 2026. As of June 30, 2026, $22.0 million in borrowings remained outstanding under the Revolving Credit Facility. The available borrowing capacity under the Revolving Credit Facility is $38.0 million as of June 30, 2026. The Company was in compliance with all existing debt covenants under the Revolving Credit Facility as of June 30, 2026. Term Loans The Company’s term loans consist of the following: (i) On November 10, 2015, Pine Ridge Winery, LLC (“PRW Borrower”), a wholly-owned subsidiary of Crimson, entered into a senior secured term loan agreement (the “2015 Term Loan”) with American AgCredit for an aggregate principal amount of $16.0 million. Amounts outstanding under the 2015 Term Loan bear a fixed interest rate of 5.24% per annum. Principal and interest are payable in quarterly installments. The 2015 Term Loan will mature on October 1, 2040. The 2015 Term Loan can be used to fund acquisitions, capital projects, and other general corporate purposes. As of June 30, 2026, $9.3 million in principal was outstanding on the 2015 Term Loan, and unamortized loan fees were less than $0.1 million. (ii) On June 29, 2017, Double Canyon Vineyards, LLC (collectively with the PRW Borrower, the “Borrowers”), a wholly-owned subsidiary of Crimson, entered into a senior secured term loan agreement (the “2017 Term Loan”) with American AgCredit for an aggregate principal amount of $10.0 million. Amounts outstanding under the 2017 Term Loan bear a fixed interest rate of 5.39% per annum. Principal and interest are payable in quarterly installments. The 2017 Term Loan will mature on July 1, 2037. The 2017 Term Loan can be used to fund acquisitions, capital projects, and other general corporate purposes. As of June 30, 2026, $5.6 million in principal was outstanding on the 2017 Term Loan, and unamortized loan fees were less than $0.1 million. Borrowers’ obligations under the 2015 Term Loan and 2017 Term Loan are guaranteed by the Company. All obligations of the Borrowers under the 2015 Term Loan and 2017 Term Loan are collateralized by certain real property of the Company. Borrowers’ covenants include the maintenance of a specified fixed charge coverage ratio and certain customary affirmative and negative covenants, including limitations on the incurrence of additional indebtedness, limitations on distributions to stockholders, and restrictions on certain investments, the sale of assets, and merging or consolidating with other entities. The Company was in compliance with all debt covenants under the 2015 Term Loan and the 2017 Term Loan as of June 30, 2026. 31 Table of Contents Consolidated Statements of Cash Flows The following table summarizes the Company’s cash flow activities for the six months ended June 30, 2026 and 2025 (in thousands): Net cash provided by (used in): 2026 2025 Operating activities $ 8,639 $ 653 Investing activities (38,821) 1,460 Financing activities 21,430 (940) Cash provided by operating activities Net cash provided by operating activities was $8.6 million for the six months ended June 30, 2026, consisting primarily of $1.0 million of net loss adjusted for $4.7 million of non-cash items and $4.9 million net cash inflow related to changes in operating assets and liabilities. Adjustments for non-cash items primarily consist of depreciation, amortization, loss on the write-down of inventory, and other offsetting items. The change in operating assets and liabilities was primarily due to a decrease in inventory (excluding inventory acquired in the Raeburn acquisition) and other current assets, partially offset by a decrease in accounts payable and accrued liabilities and an increase in accounts receivable. Net cash provided by operating activities was $0.7 million for the six months ended June 30, 2025, consisting primarily of $1.1 million of net loss adjusted for $5.1 million of non-cash items and $3.4 million net cash outflow related to changes in operating assets and liabilities. Adjustments for non-cash items primarily consist of depreciation, amortization, loss on the write-down of inventory, and other offsetting items. The change in operating assets and liabilities was primarily due to a decrease in accounts payable and accrued liabilities and an increase in inventory, partially offset by a decrease in accounts receivable and other current assets. Cash (used in) provided by investing activities Net cash used in investing activities was $38.8 million for the six months ended June 30, 2026, consisting primarily of the cash used to fund the acquisition of Raeburn Assets totaling $37.5 million and capital expenditures of $1.3 million. Net cash provided by investing activities was $1.5 million for the six months ended June 30, 2025, consisting primarily of the net redemptions of available for sale investments of $3.0 million, partially offset by capital expenditures of $1.6 million. Cash provided by (used in) financing activities Net cash provided by financing activities was $21.4 million for the six months ended June 30, 2026, consisting of $29.0 million in proceeds drawn from the Revolving Credit Facility to fund a portion of the acquisition of Raeburn Assets, partially offset by $7.0 million in aggregate payments on the Revolving Credit Facility and scheduled principal payments on the 2015 Term Loan and 2017 Term Loan of $0.6 million in the aggregate. Net cash used in financing activities was $0.9 million for the six months ended June 30, 2025, consisting of scheduled principal payments on the 2015 Term Loan and 2017 Term Loan of $0.6 million in the aggregate and the repurchase of shares of the Company’s common stock at an aggregate purchase price of $0.4 million. Share Repurchases In March 2023, the Company commenced the 2023 Repurchase Program that provided for the repurchase of up to 2,000,000 shares of outstanding common stock. Under the 2023 Repurchase Program, any repurchased shares are constructively retired. Effective March 21, 2025, upon approval of the Board of Directors, the Company suspended the 2023 Repurchase Program. Due to the suspension of the 2023 Repurchase Program, there were no repurchases of shares during the six months ended June 30, 2026. During the six months ended June 30, 2025, the Company repurchased 58,252 shares of its common stock at an average purchase price of $5.92 per share for an aggregate purchase price of $0.3 million. The Company’s repurchase was funded through cash on hand, and the shares were retired. The 2023 Repurchase Program is set to expire on December 31, 2026. 32 Table of Contents Off-Balance Sheet Financing Arrangements None. Critical Accounting Policies and Estimates There have been no material changes to the critical accounting policies and estimates previously disclosed in the 2025 Report.