Based on the provided financial report articles, the title for the article is: "FORM 10-K: ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
CO2 Energy Transition Corp. filed its annual report for the fiscal year ended December 31, 2025. The company reported a market value of $70.69 million for its common stock held by non-affiliates as of the last business day of its second fiscal quarter. The company’s financial statements reflect the correction of an error to previously issued financial statements, but no restatements were required. The report does not include any documents incorporated by reference.
Company Overview
CO2 Energy Transition Corp. is a blank check company incorporated in Delaware on September 30, 2021. The company was formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses. The company intends to use cash derived from the proceeds of its initial public offering (IPO) and the sale of private placement units, as well as debt, to complete its initial business combination.
Liquidity, Capital Resources and Going Concern
As of December 31, 2025, the company had $287,601 in cash and a working capital deficit of $422,177. Prior to the IPO, the company’s only source of liquidity was an initial purchase of shares by the sponsor and loans from the sponsor.
On November 22, 2024, the company completed its IPO of 6,900,000 units, including the full exercise of the underwriters’ over-allotment option, generating gross proceeds of $69,000,000. Simultaneously, the company sold 265,000 private placement units to the sponsor for $2,650,000.
After the IPO, $69,000,000 was placed in a trust account. The company incurred $3,423,710 in IPO-related expenses.
In 2025, the company used $745,359 in cash for operating activities, while in 2024 it used $305,589. The company generated interest income of $2,882,889 in 2025 and $310,897 in 2024 from the trust account investments.
In 2025, the company provided $79,891 in cash from investing activities by withdrawing interest from the trust account to pay taxes. In 2024, the company used $69,000,000 in investing activities to fund the trust account.
The company did not use any cash for financing activities in 2025, while in 2024 it generated $70,256,546 from the IPO and private placement.
As of December 31, 2025, the company had $72,113,895 invested in the trust account. It intends to use substantially all of these funds to complete its initial business combination.
The company has a convertible promissory note with the sponsor, dated March 31, 2025, that allows the sponsor to loan the company up to $1,500,000 for working capital, less $11,730 that was previously advanced.
The company may not be able to complete a business combination by May 22, 2026 (or up to 24 months if extended), at which point it would cease operations and liquidate. This raises substantial doubt about the company’s ability to continue as a going concern.
Off-Balance Sheet Financing Arrangements
The company does not have any off-balance sheet financing arrangements, special purpose entities, or other relationships that would be considered off-balance sheet.
Contractual Obligations
The company does not have any long-term debt, capital leases, operating leases, or other long-term liabilities, other than an agreement to pay the sponsor $10,000 per month for office space and administrative services.
The underwriters received a 0.75% cash underwriting discount of $517,500 upon closing the IPO, as well as a 3.00% deferred underwriting fee of $2,070,000 payable upon completion of the initial business combination. They also received 120,750 representative shares valued at $77,280.
Results of Operations
The company has not engaged in any operations or generated any revenue to date. Its activities have been limited to organizational tasks, preparing for the IPO, and identifying a target company for a business combination.
In 2025, the company had net income of $1,652,360, consisting of $2,882,889 in interest income from the trust account investments, offset by $646,306 in operating costs, $579,272 in income taxes, and $4,951 in interest expense.
In 2024, the company had net income of $2,632, consisting of $310,897 in interest income, offset by $246,139 in operating costs, $61,039 in income taxes, and $1,087 in interest expense.
JOBS Act
The company qualifies as an “emerging growth company” under the JOBS Act and can take advantage of certain exemptions from various reporting requirements, such as not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act.
Critical Accounting Estimates
As of December 31, 2025, the company did not have any critical accounting estimates to disclose.
Recent Accounting Standards
The company does not believe that any recently issued, but not yet effective, accounting standards would have a material effect on its financial statements.
Commitments and Contractual Obligations
The company has registration rights agreements with the holders of founder shares, private placement warrants, and warrants that may be issued upon conversion of the working capital loans. These holders will be entitled to certain demand and “piggy-back” registration rights.
The underwriters were entitled to a 0.75% cash underwriting discount of $517,500 upon closing the IPO, as well as a 3.00% deferred underwriting fee of $2,070,000 payable upon completion of the initial business combination.
The company accounts for its common stock subject to possible redemption in accordance with the guidance in ASC Topic 480, classifying the shares as temporary equity.
The company complies with the accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share,” and does not consider the effect of the warrants in the calculation of diluted earnings per share as their inclusion would be anti-dilutive.
