Our business is subject to a variety of risks and uncertainties. These risks are described elsewhere in this Quarterly Report, including in Part I, Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” above, or in our other filings with the SEC, including Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. You should carefully consider the risks and other cautionary statements described in this Quarterly Report, our 2025 Annual Report and the risk factors and other cautionary statements contained in our other SEC filings, which could materially affect our business, financial condition or future results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or future results. Except as described below and elsewhere in this Quarterly Report, there have been no material changes in our risk factors from those described in our 2025 Annual Report. Risks Related to the Pending Transactions We may not consummate the pending transactions, including the Coulomb and Na Kika Acquisition or the Offshore Mexico Farm-In Transaction on the terms currently contemplated or at all. We may not consummate various pending transactions on the timeline and terms currently contemplated or at all. For example, the Coulomb and Na Kika Acquisition is subject to the satisfaction of customary closing conditions. These conditions include, but are not limited to, (i) the expiration or termination of any applicable waiting period, or any extension thereof, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and (ii) the absence of any injunction or other order or applicable law preventing or making illegal the consummation of the Coulomb and Na Kika Acquisition. Neither we nor Shell can predict when, or if, these conditions will be satisfied. If any of these conditions are not satisfied or waived prior to the “Outside Date,” as such term is defined in the Shell Purchase Agreement, it is possible that the Coulomb and Na Kika Acquisition may be terminated. Although Talos Ocho Energy LLC, a Delaware limited liability company (“Talos Ocho”) and RE Fund V Holdco II Infrastructure, LLC, a Delaware limited liability company (“RE Fund” and together with Talos Ocho, the “Buyers”) have agreed with Shell to use commercially reasonable efforts, subject to certain limitations, to promptly complete the Coulomb and Na Kika Acquisition, these and other conditions to the completion of the Coulomb and Na Kika Acquisition may fail to be satisfied. In addition, satisfying the conditions to and completion of the Coulomb and Na Kika Acquisition may take longer, and could cost more, and require additional borrowings, than we currently expect. If additional borrowings are required to consummate the Coulomb and Na Kika Acquisition, our total debt and leverage will be greater than currently anticipated, and our availability under our bank credit facility will be reduced by a corresponding amount. If (i) the consummation of the Coulomb and Na Kika Acquisition does not occur on or before the Outside Date, or (ii) prior thereto, the Company notifies the trustee that it will not pursue the consummation of the Coulomb and Na Kika Acquisition, the Company will be required to redeem $175.0 million aggregate principal amount of the 8.000% Notes then outstanding on a pro rata basis at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the special mandatory redemption date; provided that the Company shall not be required to effect more than one special mandatory redemption. Additionally, the Offshore Mexico Farm-In Transaction is subject to approval by Mexico’s Secretaría de Energía and the National Anti-trust Commission of Mexico. There can be no assurance that closing conditions will be satisfied or that pending transactions, including the Coulomb and Na Kika Acquisition or Offshore Mexico Farm-In Transaction (collectively, the “Pending Transactions”) will be consummated on the terms currently contemplated or at all. Failure to complete the Pending Transactions on the terms currently contemplated or at all could have a material adverse effect on our results of operations, cash flows and financial position. If the Pending Transactions are not completed for any reason, including as a result of failure to obtain all requisite regulatory approvals, or if certain expectations with respect to the Pending Transactions are not fully realized (due to reasons including, but not limited to, material inaccuracies in underlying assumptions regarding future reserve and production estimates that could materially affect the benefits expected from these transactions), we may be materially adversely affected and, without realizing any of the benefits of having completed such Pending Transactions on the terms currently contemplated, we would be subject to a number of risks, including the following: •we may experience negative reactions from the financial markets; 40 Table of Contents •we may experience negative reactions from our customers, distributors, suppliers, vendors, landlords, joint venture partners and other business partners; •we may still be required to pay certain significant costs relating to the Pending Transactions, such as legal, accounting, and financial advisor fees; •with respect to the Coulomb and Na Kika Acquisition, under certain circumstances, Shell may be entitled to receive the deposit (an interest-bearing amount equal to 5% of the aggregate unadjusted purchase price, with our share being $42.5 million) as liquidated damages pursuant to the Shell Purchase Agreement; •matters relating to the Pending Transactions (including integration planning) require substantial commitments of time and resources by our management, which may result in the distraction of our management from ongoing business operations and pursuing other opportunities that could be beneficial to us; and •litigation related to any failure to complete the Pending Transactions or related to any enforcement proceeding commenced against us to perform our obligations pursuant to each transaction agreement. If the Pending Transactions are not completed, the risks described above may materialize and they may have a material adverse effect on our results of operations, cash flows, financial position and stock price.