Solidion Technology（股票代號：STI）提交咗截至2026年3月31日嘅季度報告（10-Q）

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, 2026

 

☐ 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: 001-41323

 

SOLIDION TECHNOLOGY, INC.

(Exact name of registrant as specified in its charter)

 

 Delaware   87-1993879
 (State or other jurisdiction of 

incorporation or organization)   (I.R.S. Employer

Identification Number)
 

 

 13355 Noel Rd, Suite 1100

Dallas, TX   75240
 (Address of principal executive offices)   (Zip Code)
 

 

Registrant’s telephone number, including
area code: (972) 918-5120

 

Not applicable

(Former name or former address, if changed since
last report)

 

Indicate by check mark whether the registrant
(1) has 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 Date File required to be submitted and pursuant to Rule 405 of Regulation S-T (§232.405
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 check mark 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 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 ☐
 Non-accelerated filer ☒ Smaller reporting company ☒
   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
standards 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 Exchange Act). Yes ☐ No ☒

 

Securities registered pursuant to Section 12(b)
of the Act:

 

 Title of each class   Trading Symbol   Name of each exchange on which registered
 Common Stock, par value $0.0001 per share   STI   The Nasdaq Stock Market LLC
 

 

As of May 19, 2026, there were 7,745,683 shares of common stock of
the Company issued and outstanding.

 

 

 

 
 

 

 

 

SOLIDION TECHNOLOGY, INC.

 

FORM 10-Q FOR THE QUARTER
ENDED MARCH 31, 2026

  

TABLE OF CONTENTS

 

 
 Part I - FINANCIAL INFORMATION
  
 1

 
  
  
  
  

 
 Item 1.
 Unaudited Condensed Consolidated Financial Statements
  
 1

 
  
  
  
  

 
 Item 2.
 Management’s Discussion and Analysis of Financial
 Condition and Results of Operations
  
 28

 
  
  
  
  

 
 Item 3.
 Quantitative and Qualitative Disclosures about Market
 Risk
  
 36

 
  
  
  
  

 
 Item 4.
 Controls and Procedures
  
 36

 
  
  
  
  

 
 Part II - OTHER INFORMATION
  
 37

 
  
  
  
  

 
 Item 1.
 Legal Proceedings
  
 37

 
  
  
  
  

 
 Item 1A.
 Risk Factors
  
 37

 
  
  
  
  

 
 Item 2.
 Unregistered Sales of Equity Securities and Use of
 Proceeds
  
 37

 
  
  
  
  

 
 Item 3.
 Defaults Upon Senior Securities
  
 37

 
  
  
  
  

 
 Item 4.
 Mine Safety Disclosures
  
 37

 
  
  
  
  

 
 Item 5.
 Other Information
  
 37

 
  
  
  
  

 
 Item 6.
 Exhibits
  
 38

 
  
  
  
  

 
 SIGNATURES
  
 39

 

 

 
i

 

 

 

EXPLANATORY NOTE

 

On February 2, 2024 (the “Closing Date”),
Nubia Brand International Corp., a Delaware corporation (“Nubia” and after the Transactions described herein, the “Combined
Company” or “Solidion Technology, Inc.”), consummated the previously announced business combination (the “Closing”)
pursuant to a Merger Agreement (as amended on August 25, 2023, the “Merger Agreement”), by and among Nubia, Honeycomb Battery
Company, an Ohio corporation (“HBC”), and Nubia Merger Sub, Inc., an Ohio corporation and wholly-owned subsidiary of Nubia
(“Merger Sub”). Pursuant to the Merger Agreement, Merger Sub merged with and into HBC (the “Merger,” and the transactions
contemplated by the Merger Agreement, the “Transactions”), with HBC surviving such merger as a wholly owned subsidiary of
Nubia, which was renamed “Solidion Technology, Inc.” upon Closing.

 

Unless the context otherwise
requires, the “registrant” and the “Company” refer to Nubia prior to the Closing and to the Combined Company and
its subsidiaries following the Closing and “HBC” and “Honeycomb” refers to Honeycomb Battery Company and
its subsidiaries prior to the Closing and the business of the Combined Company and its subsidiaries following the Closing.

 

The Company’s common
stock, par value $0.0001 per share (the “Common Stock”), is now listed on The Nasdaq Stock Market LLC (“NASDAQ Global”)
under the symbol “STI”. The Company’s Public Warrants to purchase Common Stock at an exercise price of $575.00 per share,
previously listed under ticker “NUBIW”, were delisted from the Nasdaq and pending listing on The OTC Markets under the symbol
“STIWW”. Until the Merger, Nubia neither engaged in any operations nor generated any revenue, and based on its business activities,
Nubia was a “shell company” as defined under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

 
ii

 

 

 

PART I - FINANCIAL
INFORMATION

 

Item 1. Unaudited Condensed Consolidated
Financial Statements

 

SOLIDION TECHNOLOGY, INC.

 

CONDENSED CONSOLIDATED BALANCE SHEETS  

(unAUDITED)

 

 
   
 March 31,
 2026  
 December 31,
 2025 

 
 ASSETS 
    
   

 
 Current Assets: 
    
   

 
 Cash 
 $38,887  
 $204,725 

 
 Accounts receivable 
  15,624  
  5,110 

 
 Other receivable 
  302,500  
  302,500 

 
 Inventory 
  24,430  
  24,430 

 
 Prepaid expenses 
  66,818  
  170,257 

 
 Deferred offering costs 
  460,915  
  -
 

 
 Other current assets 
  447,329  
  76,166 

 
 Total Current Assets 
  1,356,503  
  783,188 

 
   
     
    

 
 Property and Equipment, net of depreciation 
  1,974,467  
  2,022,043 

 
 Patents, net of amortization 
  1,995,774  
  1,991,623 

 
 Total Assets 
 $5,326,744  
 $4,796,854 

 
   
     
    

 
 LIABILITIES AND STOCKHOLDERS’ DEFICIT 
     
    

 
 Current Liabilities: 
     
    

 
 Accounts payable and accrued expenses 
 $5,553,222  
 $3,509,936 

 
 Excise tax payable 
  1,060,321  
  964,463 

 
 Derivative liabilities 
  4,211,250  
  4,772,600 

 
 Due to related party 
  162,873  
  87,873 

 
 Short-term notes payable 
  2,607,666  
  2,647,556 

 
 Total Liabilities 
  13,595,332  
  11,982,428 

 
   
     
    

 
 Commitments and contingencies (Note 6) 
   
  
   
 

 
   
     
    

 
 Stockholders’ Deficit: 
     
    

 
 Preferred stock, $0.0001 par value; 2,000,000 shares authorized; none issued and outstanding 
  -
  
  -
 

 
 Common stock, $0.0001 par value, 300,000,000 shares authorized, 7,745,683 and 7,465,283 issued and outstanding as of March 31, 2026 and December 31, 2025, respectively 
  774  
  746 

 
 Additional paid-in capital 
  159,453,519  
  159,027,646 

 
 Stock subscription receivable 
  (2,919,674) 
  (2,841,427)

 
 Accumulated deficit 
  (164,803,207) 
  (163,372,539)

 
 Total Stockholders’ Deficit 
  (8,268,588) 
  (7,185,574)

 
 Total Liabilities and Stockholders’ Deficit 
 $5,326,744  
 $4,796,854 

 

 

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

 

 
1

 

 

 

SOLIDION TECHNOLOGY, INC.

 

CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS

(unAUDITED)

 

 
   
 For the Three Months Ended 
 March 31, 

 
   
 2026  
 2025

(Restated) 

 
 Net sales 
 $85,426  
 $-
 

 
 Cost of goods sold 
  1,696  
  -
 

 
 Gross profit 
  83,730  
  -
 

 
   
     
    

 
 Operating Expenses 
     
    

 
 Research and development 
  402,387  
  1,353,050 

 
 Selling, general and administrative 
  1,455,636  
  1,779,619 

 
 Total operating expenses 
  1,858,023  
  3,132,669 

 
   
     
    

 
 Operating loss 
  (1,774,293) 
  (3,132,669)

 
   
     
    

 
 Other Income (Expense) 
     
    

 
 Change in fair value of derivative liabilities 
  561,350  
  12,417,450 

 
 Interest income 
  191  
  16,271 

 
 Interest expense 
  (147,233) 
  (106,422)

 
 Other (expense) 
  (70,683) 
  -
 

 
 Total other income 
  343,625  
  12,327,299 

 
   
     
    

 
 Net (loss) income before provision for income taxes 
  (1,430,668) 
  9,194,630 

 
   
     
    

 
 Provision for income taxes 
  -
  
  -
 

 
   
     
    

 
 Net (loss) income 
 $(1,430,668) 
 $9,194,630 

 
   
     
    

 
 Weighted average number of shares of common stock outstanding, basic 
  7,786,342  
  3,001,784 

 
 Basic net (loss) income per share of common stock 
 $(0.18) 
 $3.06 

 
 Weighted average number of shares of common stock outstanding, diluted 
  7,786,342  
  3,048,833 

 
 Diluted net loss per share of common stock 
 $(0.18) 
 $(0.30)

 

 

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

 

 
2

 

 

 

SOLIDION TECHNOLOGY, INC.

 

CONDENSED
Consolidated STATEMENTS OF CHANGES IN STOCKHOLDERs’ (DEFICIT)

 

FOR THE THREE MONTHS ENDED MARCH 31, 2026

(UNAUDITED)

 

 
   
    
    
 Additional  
    
 Stock  
  

 
   
 Common Stock  
 Paid-in  
 Accumulated  
 Subscription  
 Stockholders’ 

 
   
 Shares  
 Amount  
 Capital  
 Deficit  
 Receivable  
 (Deficit) 

 
 Balance at December 31, 2025 
  7,465,283  
 $746  
 $159,027,646  
 $(163,372,539) 
 $(2,841,427) 
 $(7,185,574)

 
 Shares issued upon settlement of warrants 
  240,400  
  24  
  (24) 
  —
  
  —
  
  —
 

 
 Forward Purchase Agreement – subscription receivable discount 
  —  
  —
  
  78,247  
  —
  
  (78,247) 
  —
 

 
 Discount on short term notes payable 
  —  
  —
  
  70,000  
  —
  
  —
  
  70,000 

 
 Stock-based compensation to consultants 
  40,000  
  4  
  (4) 
  —
  
  —
  
  —
 

 
 Stock-based compensation 
  —  
  —
  
  277,654  
  —
  
  —
  
  277,654 

 
 Net loss 
  —  
  —
  
  —
  
  (1,430,668) 
  —
  
  (1,430,668)

 
 Balance at March 31, 2026 
  7,745,683  
 $774  
 $159,453,519  
 $(164,803,207) 
 $(2,919,674) 
 $(8,268,588)

 

  

FOR THE THREE MONTHS ENDED MARCH 31, 2025

(RESTATED)

 

 
   
    
    
 Additional  
    
 Stock  
  

 
   
 Common Stock  
 Paid-in  
 Accumulated  
 Subscription  
 Stockholders’ 

 
   
 Shares  
 Amount  
 Capital  
 Deficit  
 Receivable  
 (Deficit) 

 
 Balance at December 31, 2024 
  2,633,956  
 $13,169  
 $101,998,956  
 $(122,368,539) 
 $(2,545,586) 
 $  (22,902,000)

 
 Shares issued from exercise of Series A Warrants 
  14,755  
  74  
  241,472  
  —
  
  —
  
  241,546 

 
 Conversion of convertible notes into common stock 
  67,895  
  339  
  527,161  
  —
  
  —
  
  527,500 

 
 Shares issued to consultants 
  100  
  1  
  670  
  —
  
  —
  
  671 

 
 Reverse stock split 
  —  
  (13,311) 
  13,311  
  —
  
  —
  
  —
 

 
 Stock-based compensation 
  —  
  —
  
  754,361  
  —
  
  —
  
  754,361 

 
 Net income 
  —  
  —
  
  —
  
  9,194,630  
  —
  
  9,194,630 

 
 Balance at March 31, 2025 
  2,716,706  
 $272  
 $103,535,931  
 $(113,173,909) 
 $(2,545,586) 
 $(12,183,292)

 

  

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

 

 
3

 

 

 

SOLIDION TECHNOLOGY, INC.

 

CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUdITED)

 

 
   
 For the Three Months Ended
 March 31, 

 
   
 2026  
 2025 

 
 Cash Flows From Operating Activities: 
    
   

 
 Net (loss) income 
 $(1,430,668) 
 $9,194,630 

 
 Adjustments to reconcile net (loss) income to net cash used in operating activities: 
     
    

 
 Depreciation and amortization 
  67,400  
  69,942 

 
 Stock based compensation 
  277,654  
  754,361 

 
 Equity compensation expense 
  —
  
  671 

 
 Non-cash interest expense 
  —
  
  90,450 

 
 Amortization of debt discount 
  30,110  
  —
 

 
 Change in fair value of derivative liabilities 
  (561,350) 
  (12,417,450)

 
 Changes in operating assets and liabilities: 
     
    

 
 Accounts receivable 
  (10,514) 
  —
 

 
 Prepaid expenses 
  103,439  
  (302,034)

 
 Deferred offering costs 
  (460,915) 
  —
 

 
 Other current assets 
  (371,163) 
  (607,376)

 
 Accounts payable and accrued expenses 
  2,043,286  
  867,249 

 
 Income taxes payable 
  —
  
  (6,369)

 
 Excise taxes 
  95,858  
  13,648 

 
 Due to related party 
  75,000  
  —
 

 
 Net Cash Used In Operating Activities 
  (141,863) 
  (2,342,278)

 
   
     
    

 
 Cash Flows From Investing Activities: 
     
    

 
 Capitalized patent costs 
  (23,975) 
  (40,156)

 
 Net Cash Used In Investing Activities 
  (23,975) 
  (40,156)

 
   
     
    

 
 Cash Flows From Financing Activities: 
     
    

 
 Repayment of short-term notes 
  —
  
  (42,671)

 
 Proceeds from issuance of common stock from exercise of warrants 
  —
  
  241,546 

 
 Net Cash Provided By Financing Activities 
  —
  
  198,875 

 
   
     
    

 
 Net change in cash 
  (165,838) 
  (2,183,559)

 
   
     
    

 
 Cash at beginning of period 
  204,725  
  3,353,732 

 
 Cash at end of period 
 $38,887  
 $1,170,173 

 
   
     
    

 
 Supplemental disclosure 
     
    

 
 Cash paid for interest expense 
 $—
  
 $7,329 

 
 Cash paid for federal income taxes 
 $—
  
 $6,369 

 
   
     
    

 
 Supplemental disclosure of non-cash financing activities: 
     
    

 
 Issuance of Common Stock upon the closing of the Merger 
 $—
  
 $414 

 
 FPA discount accretion 
 $78,247  
 $—
 

 
 Debt discount recognized on note payable 
 $70,000  
 $—
 

 
 Convertible notes converted to common shares 
 $—
  
 $527,500 

 
 Capitalized interest to principal balance of short-term note payable 
 $—
  
 $90,450 

 
 Reverse stock split — reclassification from common stock to additional paid-in capital 
 $—
  
 $13,311 

 
 Shares issued upon settlement of warrants 
 $24  
 $—
 

 

 

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

 

 
4

 

 

 

SOLIDION TECHNOLOGY, INC.

 

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 — DESCRIPTION OF ORGANIZATION, BUSINESS OPERATIONS
AND GOING CONCERN

 

Solidion Technology, Inc. (the “Company”,
“Solidion” or “Solidion Technology”), formerly known as Nubia Brand International Corp. prior to February 2, 2024,
was incorporated in Delaware on June 14, 2021 and is an advanced battery technology company focused on the development and commercialization
of next-generation battery materials, components, and energy storage solutions. Solidion is headquartered in Dallas, TX, with research
and development and manufacturing operations located in Dayton, OH.

 

On February 2, 2024, Nubia Brand International
Corp., a Delaware corporation (“Nubia” and after the Transactions described herein, the “Company”, “Solidion”
or “Solidion Technology, Inc.”), consummated the merger (the “Closing”) pursuant to a Merger Agreement, dated
February 16, 2023 (as amended on August 25, 2023, the “Merger Agreement”), by and among Nubia, Honeycomb Battery Company,
an Ohio corporation (“HBC”), and Nubia Merger Sub, Inc., an Ohio corporation and wholly-owned subsidiary of Nubia (“Merger
Sub”). HBC was formerly the energy solutions division of Global Graphene Group, Inc. (“G3”). Pursuant to the Merger
Agreement, Merger Sub merged with and into HBC (the “Merger,” and the transactions contemplated by the Merger Agreement, the
“Transactions”), with HBC surviving such merger as a wholly owned subsidiary of Nubia, which was renamed “Solidion Technology,
Inc.” upon Closing.

 

In accordance with the Merger Agreement, the Company
issued to the HBC stockholders aggregate consideration of 1,400,000 shares of Solidion’s common stock, minus up to 4,000 Holdback
Shares, subject to adjustment for any additional interest or penalties related to the G3 Tax Lien (the “Closing Merger Consideration
Shares”) at the effective time of the Merger Agreement (the “Effective Time”), plus up to an additional 450,000 shares
of Solidion’s common stock (the “Earnout Shares”) upon the occurrence of the following events (or earlier upon a change
of control of Solidion but subject to (and only to the extent that) the valuation of Solidion’s common stock implied by such change
of control transaction meeting the respective volume weighted average price (“VWAP”), as defined in the Merger Agreement.

 

On October 9, 2025, the Company issued 450,000 shares of its common
stock to G3 pursuant to the earnout provisions of the Merger Agreement. The issuance followed the approval of the Company’s Board
of Directors to deem all earnout milestones satisfied in full, after considering the Company’s post-merger capital structure and
ongoing shared-services arrangements with G3. Accordingly, the Company has completed its obligations related to the Earnout Arrangement
under the Merger Agreement.

 

The Merger was accounted for as a common control
transaction with respect to HBC which is akin to a reverse recapitalization. This conclusion was based on the fact that G3 had a controlling
financial interest in HBC prior to the Merger and has a controlling financial interest in Solidion (which includes HBC as a wholly owned
subsidiary). Net assets of Nubia were stated at their historical carrying amounts with no goodwill or intangible assets recognized in
accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Merger with respect
to HBC was not treated as a change in control due primarily to G3 receiving the controlling voting stake in Solidion and G3’s ability
to nominate a majority of the board of directors of Solidion. Under the guidance in ASC 805 for transactions between entities under common
control, the assets and liabilities of HBC and Nubia are recognized at their carrying amounts on the date of the Merger.

 

Under a reverse recapitalization, Nubia was treated
as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Merger was treated as
the equivalent of HBC issuing stock for the net liabilities of Nubia, accompanied by a recapitalization.

 

 
5

 

 

 

Going Concern

 

The Company’s financial statements have
been prepared under the assumption that the Company will continue as a going concern, which contemplates the realization of assets and
satisfaction of liabilities in the normal course of business for the foreseeable future.

 

Since the Company’s inception, it has experienced recurring net
losses and net cash used in operating activities and has generated minimal sales. For the three months ended March 31, 2026, the Company
recorded a net loss of $1,430,668, which included a gain of $561,350 due to the change in the fair value of derivative liabilities, net
cash used in operating activities of $141,863 and as of March 31, 2026, had cash and cash equivalents of $38,887. For the year ended December
31, 2025, the Company recorded a net loss of $41,004,000, which included a non-cash, non-operating loss of $28,250,727 due to the change
in the fair value of derivative liabilities, net cash used in operating activities of $4,536,702 and as of December 31, 2025, had cash
and cash equivalents of $204,725.

 

The Company expects to continue to incur net losses
and net cash used in operating activities in accordance with its operating plan and expects that expenditures will increase significantly
in connection with its ongoing activities. As of the balance sheet date and up to the date that the financial statements were issued,
the Company does not have availability under any debt agreements. Additionally, the Company is currently in default of an outstanding
Promissory Note due to non-payment of scheduled installments. Given the Company’s projected operating requirements and its existing
cash and cash equivalents, the Company is projecting insufficient liquidity to sustain its operations and meet its obligations through
one year following the date that the financial statements were issued. This raises substantial doubt about the Company’s ability
to continue as a going concern.

 

In addition, on September 8, 2025, the Company notified Nasdaq that,
following the resignation of a director on September 3, 2025, its Audit Committee was no longer in compliance with Nasdaq Listing Rule
5605(c)(2)(A), which requires listed companies to maintain an audit committee consisting of at least three independent directors. In accordance
with Nasdaq Listing Rule 5605(c)(4), the Company is entitled to a cure period to regain compliance, which extends until the earlier of
(i) the Company’s next annual meeting of shareholders or (ii) September 3, 2026; provided, however, that if the annual meeting occurs
on or before March 2, 2026, the cure period extended only until March 2, 2026.

 

On March 24, 2026, the company announced an annual
meeting scheduled for June 11, 2026. As a result, the Company’s cure period to regain compliance with Nasdaq Listing Rule 5605(c)(2)(A)
extends until the date of the annual meeting. The Company is actively evaluating potential candidates to fill the vacancy on its Audit
Committee and intends to regain compliance within the applicable cure period.

 

As an early-stage growth company, the Company’s
ability to access capital is critical. The Company plans to finance its operations with proceeds from the sale of equity securities or
debt; however, there is no assurance that management’s plans to obtain additional debt or equity financing will be successfully
implemented or implemented on terms favorable to the Company.

 

The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

 

Risks and Uncertainties

 

The Company’s current business activities
consist of development and commercialization of battery materials, components, cells, and selected module/pack technologies. The Company
faces inherent risks associated with its operations, such as the ongoing development of its technology, marketing, and distribution channels,
as well as the enhancement of its supply chain and manufacturing capabilities. Additionally, the need to recruit additional management
and key personnel is vital. The success of the Company’s development initiatives and the achievement of profitability hinge on various
factors, including its ability to enter potential markets and secure sustainable financing in the future.

 

The Company’s future results of operations
involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results
to vary materially from expectations include, but are not limited to, rapid technological change, competition from substitute products
and larger companies, protection of proprietary technology, ability to maintain distributor relationships and dependence on key individuals. 

 

 
6

 

 

 

NOTE 2 — CORRECTION OF ERRORS IN PREVIOUSLY
REPORTED CONSOLIDATED FINANCIAL STATEMENTS

 

As described in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2025, the Company restated its previously issued financial statements to correct errors related to (i) the
fair value remeasurement of Series A and Series B derivative warrant liabilities under ASC 815, (ii) the recognition of shares issued
and a discounted stock subscription receivable in connection with the Forward Purchase Agreement (“FPA”), and (iii) the calculation
of basic and diluted income (loss) per share for 2025 interim periods. Reference is made to Note 2 of the 2025 Annual Report on Form 10-K
for a full description of the restatement.

 

Impact of the Restatement on Previously
Issued Unaudited 2025 Interim Financial Statements

 

The restatement resulted in adjustments to the
Company’s opening stockholders’ equity as of January 1, 2025. The adjustments had no impact on the Company’s statements of operations
or cash flows for any previously issued 2025 interim period. The following table presents the impact on stockholders’ equity: 

 

 
   
 Additional
 Paid-in
 Capital  
 Accumulated
 Deficit  
 Stock
 Subscription
 Receivable  
 Total Stockholders’
 Equity
 (Deficit) 

 
 Balance at January 1, 2025 (as previously reported) 
 $93,045,581  
 $(115,880,509) 
 $(80,241) 
 $(22,902,000)

 
 Correction of prior-period error – warrant remeasurement 
  5,735,883  
  (5,735,883) 
  —
  
  —
 

 
 Correction of prior-period error – Issuance of FPA shares 
  3,124,379  
  (752,147) 
  (2,372,232) 
  —
 

 
 Correction of prior-period error – FPA subscription receivable discount 
  93,113  
  —
  
  (93,113) 
  —
 

 
 Balance at January 1, 2025 (as restated) 
  101,998,956  
  (122,368,539) 
  (2,545,586) 
  (22,902,000)

 
 Net income 
  —
  
  9,194,630  
  —
  
  9,194,630 

 
 Balance at March 31, 2025 
  103,535,931  
  (113,173,909) 
  (2,545,586) 
  (12,183,292)

 

  

Correction of Diluted Earnings Per Share

 

Additionally, the diluted net income per share included in quarter
one of the 2025 interim financial information was corrected to apply the treasury stock method to outstanding warrants. For the three
months ended March 31, 2025, the previously reported diluted net income (loss) per share of $3.04 should have been $(0.30).

 

 
7

 

 

 

NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation and Principles of
Consolidation

 

The accompanying
unaudited condensed consolidated financial statements (the “financial statements”) are presented in conformity with US GAAP
and pursuant to the rules and regulations of the SEC.

 

During the periods prior to the Closing date of
the Merger, the Company operated as part of G3. Consequently, stand-alone financial statements have not historically been prepared for
the Company. The accompanying financial statements have been prepared from G3’s historical accounting records and are presented
on a stand-alone basis as if the Company’s operations had been conducted independently from G3. Therefore, the financial statements
included herein may not be indicative of the financial position, results of operations, and cash flows of the Company in the future or
if the Company had been a separate, stand-alone entity during the periods presented.

 

The Company’s financial statements have
been prepared under the assumption that the Company will continue as a going concern, which contemplates the realization of assets and
discharge of liabilities in the normal course of business for the foreseeable future.

 

The financial
statements include the Company entities. All intercompany transactions have been eliminated for consolidation purposes.

 

Emerging Growth Company

 

The Company is an “emerging growth company,”
as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart
Our Business Startups Act of 2012, as amended (the “JOBS Act”), and it may take advantage of certain exemptions from various
reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited
to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the
Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and
exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden
parachute payments not previously approved.

 

Further, Section 102(b)(1) of the JOBS Act exempts
emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered
under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company
can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but
any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that
when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging
growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison
of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth
company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting
standards used.

 

Use of Estimates

 

The preparation of financial statements in conformity
with US GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses
during the reporting period.

 

Making estimates requires management to exercise
significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances
that existed at the date of the balance sheet which management considered in formulating its estimate, could change in the near term due
to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

 

 
8

 

 

 

Segment Reporting

 

The Company has determined that the Chief Executive
Officer is its Chief Operating Decision Maker (the “CODM”). Operating segments are defined as components of an entity for
which separate financial information is available and that is regularly reviewed by the CODM in deciding how to allocate resources to
an individual segment and in assessing performance. The Company has determined that it operates in one operating segment and one reportable
segment, as the CODM reviews financial information presented on a consolidated basis for purposes of making operating decisions, allocating
resources, and evaluating financial performance.

 

The CODM uses consolidated net (loss) as the measure
of segment profit or loss. Expense information is also reviewed only at the consolidated level, as presented in the Company’s consolidated
statement of operations. Research and development expense has been identified as a significant segment expense, with all other expense
lines being considered part of ‘Other segment items.’ Additionally, the CODM evaluates assets on a consolidated basis. As
such, the Company reports segment profit or loss, segment expenses, and segment assets on a condensed consolidated basis.

 

Cash and cash equivalents

 

The Company considers all short-term investments
with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents
as of March 31, 2026 and December 31, 2025.

 

Accounts Receivable, net of Allowance for
Credit Losses

 

Accounts receivables are stated at the amount
the Company expects to collect. The Company recognizes an allowance for credit losses to ensure accounts receivables are not overstated
due to un-collectability. Bad debt reserves are maintained as warranted for various customers based on a variety of factors, including
the length of time the receivables are past due, significant one-time events and historical experience. An additional reserve for individual
accounts is recorded when the Company becomes aware of a customer’s inability to meet its financial obligation, such as in the case
of bankruptcy filings, or deterioration in such customer’s operating results or financial position. If circumstances related to
a customer change, estimates of the recoverability of receivables would be further adjusted. As of March 31, 2026 and December 31, 2025,
the Company determined that no allowance was required.

 

Other Receivable

 

During the first quarter of 2024, the Company
advanced $302,500 to G3 for transaction costs incurred during the Merger. As of March 31, 2026 and December 31, 2025, the outstanding
balance of other receivables amounted to $302,500.

 

Inventory

 

Inventories are stated at the lower of first-in,
first-out cost or net realizable value. The Company writes-down its inventory for estimated obsolescence or unmarketable inventory equal
to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.
The Company writes off obsolete inventories when the Company deems the value to be impaired. As of March 31, 2026 and December 31, 2025,
the Company determined that no write off was required.

 

Property and Equipment, net

 

Property and equipment are recorded at cost less
accumulated depreciation. Expenditures for maintenance and repairs, which do not extend the economic useful life of the related assets,
are charged to operations as incurred, and expenditures, which extend the economic life, are capitalized. When assets are retired, or
otherwise disposed of, the costs and related accumulated depreciation or amortization are removed from the accounts and any gain or loss
on disposal is recognized. The Company reviews long-lived assets, including property and equipment and definite-lived intangible assets,
for impairment whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Indicators
of impairment may include significant underperformance relative to historical or projected future operating results, changes in the manner
or duration of use of the asset, adverse changes in business climate, or plans for disposal or restructuring.

 

When an impairment indicator is identified, the
Company performs a recoverability test by comparing the carrying amount of the asset group to the estimated undiscounted future cash flows
expected to be generated by the assets. If the carrying amount exceeds the undiscounted cash flows, an impairment loss is recognized equal
to the amount by which the carrying value exceeds the fair value of the asset group. The impairment loss is included in operating results
in the period it is determined.

 

 
9

 

 

 

Based on its assessments, the Company did not incur any impairment
charges for the three months ended March 31, 2026 and 2025.

 

The Company depreciates its property and equipment
for financial reporting purposes using the straight-line method over the estimated useful lives of the assets. The estimated useful lives
are as follows:

 

 Building  40 years
 Building improvements  15 years
 Land improvements  15 years
 Machinery & equipment  5 years
 

 

Property and equipment consisted of the following
as of March 31, 2026 and December 31, 2025:

 

 
   
 March 31,
 2026  
 December 31, 
 2025 

 
 Land improvements 
 $60,137  
 $60,137 

 
 Buildings 
  1,302,401  
  1,302,401 

 
 Building improvements 
  2,275,583  
  2,275,583 

 
 Machinery and equipment 
  2,204,815  
  2,204,815 

 
 Total property and equipment 
  5,842,936  
  5,842,936 

 
 Less: accumulated depreciation 
  (3,868,469) 
  (3,820,893)

 
 Property and equipment, net 
 $1,974,467  
 $2,022,043 

 

 

Depreciation expense of property and equipment
was $47,576 for each of the three months ended March 31, 2026 and 2025.

 

Patents

 

The Company capitalizes external costs, such as
filing fees and associated attorney fees, incurred to obtain issued patents. The Company’s intangible assets consist of capitalized
costs for unissued patents and issued patents. Issued patents are carried at cost less accumulated amortization. Successful patent efforts
are amortized over the life of the patent, and unsuccessful efforts are expensed. The issued patents are being amortized over a useful
life of 20 years. Amortization of the patent costs commences upon patent issuance.

 

Net unissued and issued patents were $1,159,540
and $836,234 as of March 31, 2026, respectively; and $1,155,196 and $836,427 as of December 31, 2025, respectively. The Company assesses
the carrying value of its intangible assets for impairment each year and when indicators exist that there could be an impairment.
Based on its assessments, the Company did not incur any impairment charges for the three months ended March 31, 2026 and 2025, respectively.
Intangible assets consisted of the following as of March 31, 2026 and December 31, 2025:  

 

 
   
 March 31,
 2026  
 December 31,
 2025 

 
 Issued patents 
    
   

 
 Gross carrying amount 
 $1,605,525  
 $1,585,894 

 
 Less: accumulated amortization 
  (769,291) 
  (749,467)

 
 Issued patents, net 
  836,234  
  836,427 

 
 Patents pending (not amortized) 
  1,159,540  
  1,155,196 

 
 Total intangible assets, net 
 $1,995,774  
 $1,991,623 

 

 

Amortization expense for the patents included
in the condensed consolidated statements of operations was $19,824 and $22,366 for the three months ended March 31, 2026 and 2025, respectively. Future amortization expense for the patents over the next five years is anticipated to be approximately $105,000
per year.

 

 
10

 

 

 

Leases

 

The Company determines whether an arrangement
is a lease at inception. For leases where the Company is the lessee, right-of-use assets are recognized as the lease liability, adjusted
for lease incentives received and prepayments made. Lease liabilities are recognized based on the present value of remaining lease payments over
the lease term. When the Company’s leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate
based on the information available at lease commencement date in determining the present value of lease payments. Operating lease
expense is recognized on a straight-line basis over the lease term. Leases with an initial lease term of 12 months or less are not recorded
on the condensed consolidated balance sheet.

 

The Company has elected the short-term lease practical expedient under
ASC 842, applying it consistently to all leases with an initial term of 12 months or less, which are excluded from the condensed consolidated
balance sheet. Lease expense for these leases is recognized on a straight-line basis over the lease term. The Company had no right-of-use
assets or lease liabilities recorded on its condensed consolidated balance sheets as of March 31, 2026 and December 31 2025, respectively.

 

Foreign Operations

 

The functional currency of Solidion’s Taiwan
subsidiary is the New Taiwan Dollar. In accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification
(ASC) 830, Foreign Currency Matters, the financial statements of the Company’s Taiwan subsidiary are translated to U.S. dollars
using the exchange rates at the balance sheet dates for assets and liabilities, the historical exchange rate for stockholders’ equity
accounts and a weighted average exchange rate for revenue, expenses and gains or losses. Foreign currency translation adjustments are
accumulated in a separate component of stockholders’ deficit until the foreign business is sold or substantially liquidated. Foreign
currency translation adjustments for the periods presented in these financial statements were not material.

 

During prior reporting periods, the Company’s
research and development facility in Taiwan, operating as an extension of the Dayton, Ohio R&D team and focused on silicon anode technology
advancement. During the three months ended March 31, 2025, the Company ceased research and development operations at its Taiwan location.
The results of operations for this location were immaterial to the Company’s condensed consolidated financial statements for all
periods presented. No material exit or disposal costs were incurred in connection with the shutdown.

 

Revenue Recognition

 

Revenue is recognized when a performance obligation
has been satisfied by transferring control of promised products or services to customers in an amount that reflects the consideration
the Company expects to receive in exchange for those products. Revenues are recognized at a point in time when control transfers to customers,
which is generally determined when title, ownership and risk of loss pass to the customer.

 

Research and Development

 

All research and development costs are expensed
as incurred. Research and development expenses consist primarily of personnel expenses, including salaries, benefits, third party technology
validation testing, equipment, engineering, maintenance of facilities, data analysis, and materials.

 

 
11

 

 

 

Selling, General and Administrative Expenses

 

Selling, general and administrative expenses represent
costs incurred by the Company in managing the business, including salary, benefits, stock-based compensation, sales, insurance, professional
fees and other operating costs associated with the Company’s non-research and development activities.

 

Stock-Based Compensation

 

The Company has an incentive equity plan, (“2023
Equity Incentive Plan”). Under the terms of the plan, Solidion’s employees, consultants and directors, and employees and consultants
of its affiliates, may be eligible to receive awards in the form of incentive stock options (“ISOs”) to employees and for
the grant of non-statutory stock options (“NSOs”), stock appreciation rights, restricted stock awards, restricted stock
unit awards, performance awards and other forms of stock awards to employees, directors and consultants.

 

The number of shares of common stock initially
reserved for issuance under the incentive plan is 190,000. Shares subject to stock awards granted under the incentive plan that expire
or terminate without being exercised in full, or that are paid out in cash rather than in shares, will not reduce the number of shares
available for issuance under the incentive plan. The incentive plan also includes an evergreen provision that provides for an automatic
annual increase to the number of shares of common stock available for issuance under the incentive plan on the first day of each
fiscal year beginning with the 2024 fiscal year, equal to the least of (i) 190,000 shares of common stock, (ii) 5% of the
total number of shares of common stock outstanding as of the last day of our immediately preceding fiscal year, or (iii) such
lesser amount determined by the plan administrator.

 

On February 12, 2026, the Company filed a Registration Statement on
Form S-8 with the Securities and Exchange Commission registering 1,084,908 shares of common stock issuable under the 2023 Equity Incentive
Plan, which became effective upon filing. As of March 31, 2026, 38,000 shares have been granted under the Plan, of which 6,667 shares
were cancelled and returned to the plan during the three months ended March 31, 2026, and 483,575 shares remain available for future issuance

 

The Company measures stock options and restricted
stock unit awards granted to employees, non-employees, and directors based on the fair value on the date of the grant and recognizes compensation
expense of those awards, over the requisite service period, which is generally the vesting period of the respective award. Options granted
under the 2023 Equity Incentive Plan vest at the rate specified in the stock option agreement as determined by the plan administrator.
The plan administrator determines the term of stock options granted under the incentive plan, up to a maximum of ten years. Forfeitures
are accounted for as they occur.

 

The Company accounts for stock-based compensation
in accordance with ASC 718, Compensation—Stock Compensation. Stock-based compensation expense for restricted stock units is measured
based on the grant-date fair value of the awards and recognized as expense over the requisite service period, which is generally the vesting
period. The Company has elected to use the accelerated attribution method, under which each vesting tranche of an award is treated as
a separate award and expensed over its respective vesting period. Compensation expense is recognized only for those awards expected to
vest, with forfeitures estimated at the grant date and adjusted prospectively, if necessary.

 

The fair value of each stock option grant is estimated
on the date of grant using the Black-Scholes option-pricing model. The Company lacks a sufficient history of company-specific historical
and implied volatility information for its common stock. The Company therefore estimates its expected stock price volatility based on
the historical volatility of publicly traded peer companies and expects to continue to do so until such time as it has adequate historical
data regarding the volatility of its own traded stock price.

 

The expected term of all of the Company’s
stock options has been determined utilizing the “simplified” method. The risk-free interest rate is determined by reference
to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term
of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends on its common stock and does
not expect to pay any cash dividends in the foreseeable future. 

 

 
12

 

 

 

Income Taxes

 

The Company follows the asset and liability method
of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for
the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets
and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply
to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances
are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

 

ASC 740 prescribes a recognition threshold and
a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax
return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.

 

The Company files income and franchise tax returns
with the United States, Texas, and Ohio. Examinations by the United States and state tax authorities may include questioning the timing
and amount of deductions, the nexus of income among various state and local tax jurisdictions and compliance with federal and state tax
laws. As of March 31, 2026, all tax years since the 2021 inception year are subject to examination for U.S. federal and state purposes.
The Company’s management does not expect that the total amount of unrecognized tax benefits will materially change over the next
twelve months.

 

In July 2025, the One Big Beautiful Bill Act (Public
Law 119-21) was enacted. The Company recognized the income tax effects of the legislation in the period of enactment in accordance with
ASC 740, which did not have a material impact on the Company’s financial statements. The Company continues to evaluate the impact of the
legislation on future periods.

 

Net income (Loss) per Common
Stock

 

The Company complies with accounting and disclosure
requirements of FASB ASC Topic 260, “Earnings Per Share.” Net (loss) per share of common stock is computed by dividing
net (loss) by the weighted average number of shares of common stock outstanding for the period.

 

The calculation of diluted loss per share of common stock does not
include potentially dilutive common stock equivalents if their inclusion would be anti-dilutive as of March 31, 2026 and 2025. As such,
net loss per common stock is the same for basic and diluted loss per share for the three months ended March 31, 2026.

 

The following table presents potentially dilutive
common stock equivalents that have been excluded from the calculation of dilutive loss per share as their inclusion would be anti-dilutive:

 

 
   
 March 31,
 2026 

 
 Holdback Shares 
  4,000 

 
 Warrants - Public 
  123,500 

 
 Warrants - Private 
  108,100 

 
 Warrants - Series A 
  508,857 

 
 Stock-based compensation - equity awards 
  6,000 

 
 Stock-based compensation - warrants 
  12,000 

 
 Total common stock equivalents excluded from dilutive loss per share 
  762,457 

 

 

 
13

 

 

 

The following table presents potentially dilutive
common stock equivalents that have been included in the calculation of dilutive income per share for the three months ended March 31,
2025, as their inclusion would be dilutive.

 

 
   
 March 31,
 2025 

 
 Stock-b