Stardust Power Inc 10-Q for FY2025 Q3
Stardust Power Inc. (SDST)
About this 10-Q
Stardust Power Inc filed this 10-Q on November 13, 2025, covering the quarter ended September 30, 2025 (FY2025 Q3).
Headline figures
Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net loss
- $4.46M
- compared with a net loss of $10.09M a year earlier
- Diluted EPS
- -$0.53
- compared with -$2.23 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For
the quarterly period ended
For the transition period from __________ to __________
Commission
File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification Number) |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
Not applicable
(Former name or former address, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The Capital Market | ||||
| The Capital Market |
Securities registered pursuant to Section 12(g) of the Act: None
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.
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).
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. (Check one):
| Large accelerated filer | ☐ | 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
As of November 12, 2025, there were shares of common stock, par value $ per share, issued and outstanding.
STARDUST POWER INC.
FORM 10-Q FOR THE QUARTER ENDED
September 30, 2025
Table of Contents
| i |
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this Quarterly Report on Form 10-Q may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our and our management team’s expectations, hopes, beliefs, intentions, or strategies regarding the future. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “can”, “contemplate,” “continue,” “could,” “design,” “estimate,” “expect,” “intends,” “leading,” “may,” “might,” “objective,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as—and must not be relied on by any investor as—guarantees, assurances, predictions, or definitive statements of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of Stardust Power Inc. (the “Company” or “Stardust Power”). Forward-looking statements in this Quarterly Report on Form 10-Q may include, for example, statements about:
| ● | the uncertainty of the projected financial information with respect to the Company; | |
| ● | the substantial doubt regarding our ability to continue as a going concern and the need to raise capital in the near term in order to maintain the Company’s operations; | |
| ● | our failure to realize the anticipated benefits of the Business Combination; | |
| ● | our ability to maintain the listing of the Common Stock and the Public Warrants on the Nasdaq; | |
| ● | our ability to maintain compliance with the Nasdaq’s continued listing requirements and rules, and the risk that the Nasdaq may delist our Common Stock and Public Warrants, which could negatively affect the Company, the price of our Common Stock and Public Warrants and our shareholders’ ability to sell our Common Stock and Public Warrants in the event we are unable to list our Common Stock and Public Warrants on another exchange; | |
| ● | the Company’s ability to issue equity or equity-linked securities, to obtain debt financing, or refinance existing indebtedness on satisfactory terms, or otherwise raise financing in the future; | |
| ● | the liquidity and trading of the Common Stock and the Public Warrants; | |
| ● | members of the Company’s management team allocating their time to other businesses and potentially having conflicts of interest with the Company’s business; | |
| ● | the Company’s future financial performance; | |
| ● | the Company’s success in retaining or recruiting, or changes required in, its officers, key employees, or directors; | |
| ● | the Company’s ability to manage future growth; | |
| ● | the Company’s ability to operate in the lithium industry; | |
| ● | the Company’s ability to enter into and deliver products under offtake agreements; | |
| ● | the Company’s ability to develop new products and services, bring them to market in a timely manner, and make enhancements to its business; | |
| ● | the effects of competition on the Company’s business; | |
| ● | market demand for and uses of lithium-based end products; | |
| ● | changes in domestic and foreign business, financial, political, and legal conditions; | |
| ● | future global, regional, or local economic and market conditions; | |
| ● | the outcome of any potential litigation, government and regulatory proceedings, investigations, and inquiries; | |
| ● | the development, effects and enforcement of laws and regulations; | |
| ● | the impact of material weaknesses or deficiencies in our internal control over financial reporting; and | |
| ● | the Company’s other plans, objectives, expectations, and intentions described or referenced in this Quarterly Report on Form 10-Q under the heading “Risk Factors,” and other documents that the Company files from time to time with the SEC. |
If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements.
In addition, forward-looking statements reflect our expectations, plans, or forecasts of future events and views as of the date hereof. We anticipate that subsequent events and developments will cause our assessments to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so except as otherwise required by applicable law. These forward-looking statements should not be relied upon as representing our assessment as of any date subsequent to the date hereof.
These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements. As a result of a number of known and unknown risks and uncertainties, actual results or our performance of the Company may be materially different from those expressed or implied by these forward-looking statements.
You should read this Quarterly Report on Form 10-Q and the documents that we reference in and have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
| ii |
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Stardust Power Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(all amounts in USD, except number of shares)
| As of September 30, 2025 | As of December 31, 2024 | |||||||
| (unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses and other current assets | ||||||||
| Deferred transaction costs | ||||||||
| Promissory notes | ||||||||
| Total current assets | $ | $ | ||||||
| Property and equipment, net | ||||||||
| Capital project costs | ||||||||
| Investment in equity securities | ||||||||
| Other long-term assets | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued liabilities and other current liabilities | ||||||||
| Current portion of early exercised shares option liability | ||||||||
| Short-term loan from related parties (Note 12) | ||||||||
| Short-term loans | ||||||||
| Total current liabilities | $ | $ | ||||||
| Warrant liability | ||||||||
| Advance from PIPE investor | ||||||||
| Earnout liability | ||||||||
| Early exercised shares option liability | ||||||||
| Total liabilities | $ | $ | ||||||
| Commitments and contingencies (Note 3) | ||||||||
| Stockholders’ equity (deficit) | ||||||||
| Preferred stock, $ par value, shares authorized, shares issued and outstanding as at September 30, 2025, and December 31, 2024 | ||||||||
| Common stock, $ par value, shares authorized, and shares issued and outstanding as at September 30, 2025, and December 31, 2024 respectively(1) | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | $ | ( | ) | $ | ( | ) | ||
| Total liabilities and stockholders’ deficit | $ | $ | ||||||
| (1) |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 1 |
Stardust Power Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(all amounts in USD, except number of shares)
(Unaudited)
| September
30, 2025 | September
30, 2024 | September
30, 2025 | September
30, 2024 | |||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September
30, 2025 | September
30, 2024 | September
30, 2025 | September
30, 2024 | |||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||
| General and administrative expenses | ||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income (expenses) | ||||||||||||||||
| Interest income | ||||||||||||||||
| Interest expense | ( | )1 | ( | )1 | ( | )1 | ( | )1 | ||||||||
| Finance charge | ( | ) | ( | ) | ||||||||||||
| Change in fair value of sponsor earn out shares | ||||||||||||||||
| Change in fair value of warrant liability | ( | ) | ( | ) | ( | ) | ||||||||||
| Change in fair value of investment in equity securities | ( | ) | ( | ) | ||||||||||||
| Change in fair value of convertible notes | ( | ) | ||||||||||||||
| Change in fair value of SAFE notes | ( | ) | ||||||||||||||
| Loss on sale of investment in equity securities | ( | ) | ( | ) | ||||||||||||
| Loss on write-off of Promissory note and deposit | ( | ) | ||||||||||||||
| Total other income (expenses) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss per share (2) | ||||||||||||||||
| Basic(2) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Diluted(2) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted average common shares outstanding (2) | ||||||||||||||||
| Basic(2) | $ | $ | $ | $ | ||||||||||||
| Diluted(2) | $ | $ | $ | $ | ||||||||||||
| (1) | |
| (2) |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 2 |
Stardust Power Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
(all amounts in USD, except number of shares)
(Unaudited)
| Shares | Amount(1) | capital (1) | Deficit | Deficit | ||||||||||||||||
| For the nine months ended September 30, 2024 | ||||||||||||||||||||
| Common Stock (1) | Additional paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | capital (1) | Deficit | Deficit | ||||||||||||||||
| Balance as at December 31, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Retroactive application of recapitalization | ( | ) | ||||||||||||||||||
| Retroactive application of reverse stock split | ( | ) | ( | ) | ||||||||||||||||
| Balance as at December 31, 2023 | $ | ( | ) | $ | ( | ) | ||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Stock based compensation (Note 3) | - | |||||||||||||||||||
| Transfer from early exercised stock option liability on vesting (Note 3) | - | |||||||||||||||||||
| Balance as at March 31, 2024 | ( | ) | ( | ) | ||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Transfer from early exercised stock option liability on vesting (Note 3) | - | |||||||||||||||||||
| Stock based compensation (Note 3) | ||||||||||||||||||||
| Balance as at June 30, 2024 | $ | ( | ) | ( | ) | |||||||||||||||
| Net loss | ( | ) | ( | ) | ||||||||||||||||
| Stock based compensation (Note 5) | - | |||||||||||||||||||
| Transfer from early exercised stock option liability on vesting (Note 5) | - | |||||||||||||||||||
| Shares issued upon conversion of SAFE notes | ||||||||||||||||||||
| Shares issued upon conversion of convertible notes | ||||||||||||||||||||
| Issuance of common stock upon the reverse capitalization including PIPE financing, net of assumed liabilities | ( | ) | ( | ) | ||||||||||||||||
| Shares issued upon exercise of common stock warrants | ||||||||||||||||||||
| Transaction costs | - | ( | ) | ( | ) | |||||||||||||||
| Merger earnout shares (Note 3) | - | ( | ) | |||||||||||||||||
| Balance as at September 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| For the nine months ended September 30, 2025 | ||||||||||||||||||||
| Common Stock (1) | Additional paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares | Amount | capital (1) | Deficit | Deficit | ||||||||||||||||
Balance as at December 31, 2024 | ( | ) | ( | ) | ||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Transfer from early exercised stock option liability on vesting (Note 5) | - | |||||||||||||||||||
| Stock based compensation (Note 5) | - | |||||||||||||||||||
| Issuance of common stock | ||||||||||||||||||||
| Issuance of common stock and warrants from January 2025 public offering, net of offering costs | ||||||||||||||||||||
| Issuance of common stock upon warrant inducement, net of offering costs | ||||||||||||||||||||
| Repurchase of unvested early exercised common stock | ( | ) | ||||||||||||||||||
| Issuance of common stock for settlement of RSU | ( | ) | ||||||||||||||||||
| Balance as at March 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Transfer from early exercised stock option liability on vesting (Note 5) | - | |||||||||||||||||||
| Stock based compensation (Note 5) | - | |||||||||||||||||||
| Issuance of common stock (Note 4) | ||||||||||||||||||||
| Issuance of common stock to short- term loan holders (Note 14) | ||||||||||||||||||||
| Issuance of common stock to PIPE investors (Note 4) | ||||||||||||||||||||
| Issuance of common stock to vendor | ||||||||||||||||||||
| Issuance of common stock under license arrangement (Note 4) | ||||||||||||||||||||
| Issuance of common stock for settlement of RSU | ( | ) | ||||||||||||||||||
| Issuance of common stock from public offering, net of offering costs | ||||||||||||||||||||
| Balance as at June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Transfer from early exercised stock option liability on vesting (Note 5) | - | |||||||||||||||||||
| Stock based compensation (Note 5) | - | |||||||||||||||||||
| Issuance of common stock (Note 4) | ||||||||||||||||||||
| Issuance of common stock for settlement of RSU | ( | ) | ||||||||||||||||||
| Fractional share adjustment due to reverse stock split | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Balance as at September 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Balance | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| (1) |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 3 |
Stardust Power Inc. & Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(all amounts in USD)
(Unaudited)
| Nine months ended September 30, 2025 | Nine months ended September 30, 2024 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Stock based compensation | ||||||||
| Change in fair value of common stock make-whole obligation | ||||||||
| Loss on sale of investments in equity securities | ||||||||
| Change in fair value of investment in equity securities | ||||||||
| Change in fair value of SAFE notes | ||||||||
| Loss on write-off of promissory notes and deposit | ||||||||
| Loss on write-off of deferred transaction cost | ||||||||
| Change in fair value of warrant liability | ( | ) | ||||||
| Change in fair value of convertible notes | ||||||||
| Change in fair value of sponsor earnout shares | ( | ) | ( | ) | ||||
| Depreciation expense | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses and other assets | ( | ) | ( | ) | ||||
| Accounts payable | ( | ) | ||||||
| Accrued liabilities and other current liabilities | ||||||||
| Net cash used in operating activities | $ | ( | ) | $ | ( | ) | ||
| Cash flows from investing activities: | ||||||||
| Capital project costs | ( | ) | ( | ) | ||||
| Land acquisition cost | ( | ) | ||||||
| Proceeds from sale of investment in equity securities | ||||||||
| Investment in other long-term assets | ( | ) | ||||||
| Purchase of property and equipment | ( | ) | ||||||
| Promissory notes issued | ( | ) | ||||||
| Net cash used in investing activities | $ | ( | ) | $ | ( | ) | ||
| Cash flows from financing activities: | ||||||||
| Proceeds from investor for issuance of SAFE notes | ||||||||
| Proceeds from issuance of common stock | ||||||||
| Proceeds from issuance of notes payable to related parties | ||||||||
| Repayment of notes payable to related parties | ( | ) | ||||||
| Repayment of short-term loan from related parties | ( | ) | ||||||
| Proceeds from short-term loan | ||||||||
| Repayment of short-term loan | ( | ) | ( | ) | ||||
| Proceeds from advance received from PIPE investors | ||||||||
| Deferred transaction costs paid | ( | ) | ( | ) | ||||
| Proceeds from public offering | ||||||||
| Proceeds from warrant inducement exercises | ||||||||
| Transaction costs associated with public offering and warrant inducement | ( | ) | ||||||
| Repayment of sponsor promissory notes | ( | ) | ||||||
| Proceeds from exercise of warrants | ||||||||
| Proceeds from issuance of convertible notes | ||||||||
| Repurchase of unvested shares | ( | ) | ( | ) | ||||
| Cash in lieu payment on fractional shares under reverse stock split | ( | ) | ||||||
| Net cash provided by financing activities | $ | $ | ||||||
| Net (decrease)/ increase in cash | $ | $ | ||||||
| Cash at the beginning of the period | ||||||||
| Cash at the end of the period | $ | $ | ||||||
| Supplemental disclosure for cash flow information: | ||||||||
| Interest paid | $ | $ | ||||||
| Taxes paid | ||||||||
| Supplemental disclosure of non-cash investing and financing activities: | ||||||||
| Unpaid deferred transaction costs | $ | $ | ||||||
| Unpaid capital project costs | ||||||||
| Conversion of legacy SAFE notes | ||||||||
| Conversion of legacy convertible notes | ||||||||
| Sponsor earnout share liability | ||||||||
| Issuance of common stock to Sponsor | ||||||||
| Net liabilities assumed upon closing of business combination | ||||||||
| Issuance of common stock to non-redeeming shareholders | ||||||||
| Unpaid pre-acquisition capital project costs | ||||||||
| Reclass of advances to capital project costs | ||||||||
| Unpaid public offering issuance cost | ||||||||
| Unpaid warrant inducement issuance cost | ||||||||
| Incremental fair value of warrant inducement | ||||||||
| Issuance of common stock to short- term loan holders | ||||||||
| Issuance of common stock to PIPE investors | ||||||||
| Issuance of common stock to vendor | ||||||||
| Issuance of common stock under license arrangement | ||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 4 |
Stardust Power Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 – DESCRIPTION OF THE COMPANY
Nature of Business
Stardust
Power Inc. (the “Company”, “Stardust Power”) formerly known as Global Partner Acquisition Corp II, a Delaware
corporation, is an American developer of battery grade lithium carbonate, designed to foster energy independence in the United States.
While the Company has not earned any revenue yet, the Company is in the process of developing a strategically central, lithium refinery
capable of producing up to
Business Combination
On November 21, 2023, Stardust Power Operating Inc (f/k/a Stardust Power Inc. prior to the consummation of the Business Combination, “Legacy Stardust Power”) entered into a business combination agreement (the “Business Combination Agreement”) with Global Partner Acquisition Corp II (“GPAC II”), a Cayman Islands exempted company incorporated on November 3, 2020, Strike Merger Sub I, Inc. (“First Merger Sub”), a Delaware corporation and direct wholly owned subsidiary of GPAC II, and Strike Merger Sub II LLC (“Second Merger Sub”), a Delaware limited liability company and direct wholly owned subsidiary of GPAC II. On July 8, 2024, former Stardust Power Inc. was renamed Stardust Power Operating Inc.
On July 8, 2024 (the “Closing Date”), Legacy Stardust Power completed the business combination contemplated by the Business Combination Agreement (the “Business Combination”). GPAC II deregistered as a Cayman Islands exempted company and domesticated in the State of Delaware as a Delaware corporation. As per the Business Combination Agreement, First Merger Sub merged into Legacy Stardust Power, with Legacy Stardust Power being the surviving corporation (the effective time of such merger being the “First Effective Time”). Legacy Stardust Power then merged into Second Merger Sub, with Second Merger Sub being the surviving entity. Upon the completion of the Business Combination, GPAC II was renamed Stardust Power Inc. (also referred to herein as the “Combined Company” or “Stardust Power”).
The common stock (the “Common Stock”) and warrants of the Company are currently listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “SDST” and “SDSTW”, respectively.
The Business Combination was accounted for as a reverse recapitalization. Accordingly, Legacy Stardust Power was deemed the accounting acquirer (and legal acquiree) and GPAC II was treated as the accounting acquiree (and legal acquirer). Under this method of accounting, the reverse recapitalization was treated as the equivalent of Legacy Stardust Power issuing stock for the net assets of GPAC II, accompanied by recapitalization.
| 5 |
NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared on the accrual basis of accounting in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting.
In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the unaudited condensed consolidated financial statements) considered necessary to present fairly the Company’s unaudited condensed consolidated balance sheet as of September 30, 2025, its unaudited condensed consolidated statements of operations, stockholders’ deficit for the three and nine months ended September 30, 2025 and September 30, 2024 and unaudited condensed consolidated statements of cashflows for nine months ended September 30, 2025 and September 30, 2024. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. As such, the information included in this report should be read in conjunction with the audited consolidated financial statements and notes thereto of Stardust Power for the year ended December 31, 2024 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 27, 2025, (the “Form 10-K”), which provides a more complete discussion of the Company’s accounting policies and certain other information. The accompanying condensed consolidated balance sheet as of December 31, 2024, has been derived from the audited consolidated balance sheet as of December 31, 2024, contained in the above referenced Form 10-K.
The unaudited condensed consolidated financial statements include the accounts of Stardust Power Inc. and its wholly owned subsidiaries, Stardust Power LLC and Strike Merger Sub II, LLC. All material intercompany balances have been eliminated upon consolidation. Interim results are not necessarily indicative of results for a full year or any future periods.
These unaudited condensed consolidated financial statements are presented in U.S. dollars.
Use of Estimates
The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the unaudited condensed consolidated financial statements and accompanying notes. Those estimates and assumptions include, but are not limited to, useful life of assets, realization of deferred tax assets, and fair valuation of stock based compensation, common shares purchase agreement, warrants, convertible notes, simple agreement for future equity notes (each a “SAFE note”), and sponsor earnout shares. The Company evaluates estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates, and those differences could be material to the unaudited condensed consolidated financial statements.
Emerging Growth Company
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 Securities Exchange Act of 1934 (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 an accounting 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.
| 6 |
Reverse Stock Split
On
September 8, 2025, the Company effected a
Going Concern
The Company’s unaudited condensed consolidated financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.
As
of September 30, 2025, the Company has $
On
October 7, 2024, the Company entered into a Common Stock Purchase Agreement (the “Purchase Agreement”) and a related
Registration Rights Agreement (the “Registration Rights Agreement”) with B. Riley Principal Capital II, LLC (“B.
Riley Principal Capital II”) to sell up to $
On
January 27, 2025, the Company consummated a public offering of
shares of Common Stock and accompanying warrants to purchase
up to
On
March 16, 2025, the Company entered into a letter agreement (the “Inducement Letter”) with a warrant holder (the “Exercising
Holder”) providing for the immediate cash exercise of outstanding warrants to purchase
On
June 18, 2025, the Company consummated a public offering of
As of the date on which these unaudited condensed consolidated financial statements were available to be issued, we believe that the cash on hand, and additional investments available through issuance of new Common Stock, will be inadequate to satisfy the Company’s working capital and capital expenditure requirements for at least the next twelve months. The ability of the Company to continue as a going concern is dependent upon management’s plan to raise additional capital from issuance of equity or receive additional borrowings to fund the Company’s operating and investing activities over the next year. These unaudited condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
| 7 |
Stardust Power Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Summary of Significant Accounting Policies
The significant accounting policies applied in the Company’s audited consolidated financial statements as of and for the year ended December 31, 2024, as disclosed in the Form 10-K, are applied consistently in these unaudited interim condensed consolidated financial statements.
The Company adopted ASC 260, “Earnings per Share”, at its inception. Basic net loss per share is calculated by dividing the net loss by the weighted average number of Common Stock outstanding for the period. Diluted loss per share is calculated by dividing the Company’s net loss available to common stockholders by the diluted weighted average number of shares outstanding for the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as at the first of the year for any potentially dilutive debt or equity. Potential common shares from unvested restricted stock options, earnouts and common stock warrants are computed using the treasury stock method. Contingently issuable shares are included in basic EPS only when there is no circumstance under which those shares would not be issued.
SCHEDULE OF BASIC AND DILUTED NET LOSS PER SHARE
| September 30, 2025 | September 30, 2024 | September 30, 2025 | September 30, 2024 | |||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2025 | September 30, 2024 | September 30, 2025 | September 30, 2024 | |||||||||||||
| Numerator: | ||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Denominator: | ||||||||||||||||
| Weighted average shares outstanding | ||||||||||||||||
| Net loss per share, basic and diluted | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
SCHEDULE OF ANTI-DILUTIVE EFFECT
| September 30, 2025 | September 30, 2024 | |||||||
| Unvested common stock – restricted shares (Note 5) | ||||||||
| Restricted Stock options | ||||||||
| Restricted Stock Units | ||||||||
| Performance Stock units | ||||||||
| Sponsor Earnout Shares (Note 4)* | ||||||||
| Public warrants | ||||||||
| Private warrants | ||||||||
| Inducement warrants | ||||||||
| Short term loan warrants | ||||||||
| Private placement warrants | ||||||||
| Potentially dilutive shares | ||||||||
| * |
| 8 |
Stardust Power Inc. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Deferred Transaction Costs
In
accordance with ‘Codification of Staff Accounting Bulletins – Topic 5: Miscellaneous Accounting A. Expenses of Offering’
(“SAB Topic 5”), public offering related costs, including legal fees and advisory and consulting fees, are deferred until
consummation/completion of the proposed public offering. The Company deferred $
The
Company has deferred $
Capital Project Costs and Property and Equipment, Net
The
Company had an exclusive option purchase agreement with the City of Muskogee, Oklahoma for 66 acres of undeveloped tract (excluding wetlands
and creeks). On January 10, 2024, the Company entered into an agreement to exercise the option and purchase the land for an amount of
$
Property
and equipment, net is stated at cost less accumulated depreciation and accumulated impairment loss. The Company depreciates computer
and equipment using the straight-line method over the estimated economic useful lives of the asset, which are generally
Recent Accounting Pronouncements
From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”), under its ASC or other standard setting bodies, and adopted by the Company as of the specified effective date. The Company has reviewed the accounting pronouncements issued during the nine months ended September 30, 2025, and concluded they were either not applicable or not expected to have a material impact on the Company’s unaudited condensed consolidated financial statements.
NOTE 3 - COMMITMENTS AND CONTINGENCIES
Certain conditions may exist as at the date the unaudited condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. The Company monitors the arrangements that are subject to guarantees in order to identify if the obligor who is responsible for making the payments fails to do so. If the Company determines it is probable that a loss has occurred, then any such estimable loss would be recognized under those guarantees. The methodology used to estimate potential loss related to guarantees considers the guarantee amount and a variety of factors, which include, depending on the counterparty, the latest financial position of the counterparty, actual defaults, historical defaults, and other economic conditions. Management does not believe, based upon information available at this time, that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.
| 9 |
On
October 10, 2023, Legacy Stardust Power entered into a non-binding (except for the confidentiality provision) letter of intent with QX
Resources Limited, an Australian limited liability company (“QXR”), to negotiate an agreement to work together collaboratively
and in good faith to assess the lithium brines contained in QXR’s Liberty Lithium Brine Project (the “Project”). QXR
is earning into 75% of the Project situated in Inyo County, California, by way of an earn-in agreement with IG Lithium LLC (“IGL”)
and QXR intends to use either evaporation or direct extraction technology to produce a concentrated lithium product or other lithium
products. On August 16, 2024, the Company entered into a promissory note arrangement with IGL (the “IGL Note”) for $
On
August 4, 2024, the Company entered into an engineering agreement (the “Primero Agreement”) with Primero USA, Inc.
(“Primero”) pursuant to which Primero agreed to provide certain engineering, design and consultancy professional
services, including to assist in procurement of major equipment, engage relevant third parties for construction and provide a Front
End Loading-3 (“FEL-3”) report of the Company’s Lithium Facility at Southside Industrial Park, in Muskogee,
Oklahoma. The total amount due pursuant to the Primero Agreement, assuming full performance, is approximately $
On February 7, 2025 (the “Effective Date”), the Company executed an exclusive license agreement (the “License Agreement”) with KMX Technologies, Inc. a Delaware corporation. Under the terms of the License Agreement, KMX agreed to irrevocably license to the Company the use of KMX’s vacuum membrane distillation technology (“VMD Technology”) and associated processes and systems (including units incorporating the VMD Technology (“KMX VMD Units”)) for the purpose of the Company’s use of the technology in its refining and upstream operations. Among other obligations set forth in the License Agreement, the Company shall be required to exclusively purchase all KMX VMD Units from the Licensor during the term of the License Agreement on the terms and conditions set forth therein.
Legal Proceedings
We are also subject to certain routine legal and regulatory proceedings, as well as demands and claims that arise in the normal course of our business. We make a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. In our opinion, resolution of any pending claims (either individually or in the aggregate) is not expected to have a material adverse impact on our consolidated results of operations, cash flows or financial position, nor is it possible to provide an estimated amount of any such loss. However, depending on the nature and timing of any such dispute, an unfavorable resolution of a matter could materially affect our future financial position, results of operations, or cash flows, or all in a particular period.
NOTE 4 – COMMON STOCK
On July 8, 2024, the Common Stock and warrants began trading on Nasdaq under the ticker symbols “SDST” and “SDSTW”, respectively.
Each share of Common Stock is entitled to one vote. The holders of Common Stock are also entitled to receive dividends whenever funds are legally available and when declared by the board of directors (the “Board”), subject to prior rights of the convertible preferred stockholders. Shares of Common Stock issued and outstanding on the unaudited condensed consolidated balance sheet and unaudited condensed consolidated statement of stockholders’ deficit includes shares related to restricted stock that are subject to repurchase.
| 10 |
The Company is authorized to issue and shares, par value of $ per share, of Common Stock and Preferred stock, respectively. At September 30, 2025, the Company had shares of Common Stock issued and outstanding. As of December 31, 2024, the Company had
Sponsor Earnout Shares
Upon the occurrence of a change in control, any remaining unvested Sponsor Earnout Shares become vested. Unvested Sponsor Earnout Shares will be forfeited if vesting does not occur prior to the eighth anniversary of the Closing Date. The Company assesses the fair value of expected earnout consideration at each reporting period using the Monte Carlo Method, which is consistent with the initial measurement of the expected earnout consideration. The Company did not perform a fair valuation of expected earnout consideration using the Monte Carlo method as of September 30, 2025 as the Company determined that change in fair value is deemed immaterial to the fair value of earnout consideration. As at September 30, 2025 and December 31, 2024, the fair value of Sponsor Earnout Shares amounted to $ and $, respectively.
The Sponsor Earnout Shares were valued using the following assumptions under the Monte Carlo Model that assumes optimal exercise of the Company’s redemption option at the earliest possible date:
SCHEDULE OF ASSUMPTIONS UNDER THE MONTE CARLO MODEL
| March 31, 2025 | December 31, 2024 | |||||||
| Market price of public stock | $ | $ | ||||||
| Expected term (years) | ||||||||
| Volatility | % | % | ||||||
| Risk-free interest rate | % | % | ||||||
| Dividend rate | % | % | ||||||
| 11 |
Common Stock Purchase Agreement
On
October 7, 2024, the Company entered into a Common Stock Purchase Agreement and a Registration Rights Agreement (collectively referred
to as the “Purchase Agreement”) with B. Riley Principal Capital II, LLC. Pursuant to the Purchase Agreement, the Company
has the right, in its sole discretion, to sell to B. Riley Principal Capital II, LLC up to the lesser of (i) $
Upon
executing the Purchase Agreement and Registration Rights Agreement, the Company also issued shares of Common Stock called Commitment
Shares to B. Riley Principal Capital II, LLC as a consideration for this agreement. These shares, valued at $ each (based on Nasdaq’s
closing price on October 4, 2024), represent 1.0% of B. Riley Principal Capital II, LLC’s $
a)
b)
c)
Under
the terms of the Purchase Agreement, if the aggregate proceeds received by B. Riley Principal Capital II, LLC from its resale of the
Commitment Shares is less than $
The
Company agreed to reimburse B. Riley Principal Capital II, LLC an amount of $
The
Company issued shares of Common Stock during the nine months ended September 30, 2025, aggregating to net proceeds of $
| 12 |
Public Offering and Warrant Inducement
On
January 27, 2025, the Company consummated a public offering of shares of Common Stock and accompanying warrants to purchase up
to
On
March 16, 2025, the Company entered into a letter agreement (the “Inducement Letter”) with a warrant holder (the “Exercising
Holder”) providing for the immediate cash exercise of outstanding warrants to purchase
The
Company evaluated the common stock purchase warrants issued under this inducement offer to determine whether they should be accounted
for considering the guidance in ASC 815-40, “Derivatives and Hedging - Contracts on an Entity’s Own Equity” (“ASC
815-40”) and concluded that the warrants are freestanding and are indexed to the Company’s own stock and are classified as
equity. The Company recognized the incremental fair value due to effect of the modification of approximately $
Subsequent
to the quarter end, the Company entered into a Warrant Exchange Agreement (the “Exchange Agreement”) with a certain
institutional investor (the “Investor”). Pursuant to the Exchange Agreement, the Investor agreed to irrevocably
exchange all of its warrants to purchase shares of the Common stock, originally issued on March 16, 2025, representing the right to purchase
an aggregate of
On
June 18, 2025, the Company consummated a public offering of shares of Common Stock at a public offering price of $ per
share, generating aggregate gross proceeds of approximately $
| 13 |
KMX Licensing Agreement
On February 7, 2025 (the “Effective Date”), the Company executed an exclusive license agreement (the “License Agreement”) with KMX Technologies, Inc. a Delaware corporation. Under the terms of the License Agreement, KMX agreed to irrevocably license to the Company the use of KMX’s vacuum membrane distillation technology (“VMD Technology”) and associated processes and systems (including units incorporating the VMD Technology (“KMX VMD Units”)) for the purpose of the Company’s use of the technology in its refining and upstream operations. Among other obligations set forth in the License Agreement, the Company shall be required to exclusively purchase all KMX VMD Units from the Licensor during the term of the License Agreement on the terms and conditions set forth therein. The License Agreement grants the Company the exclusive right to sub license, use, market, sell and operate KMX’s VMD Technology across the United States, Canada and select international markets. As a consideration for this license, the Company agreed to pay KMX a royalty comprised of shares of Company Common Stock. The securities are being offered and sold by the Company pursuant to an exemption from the registration requirements of the Securities Act provided by Section 4(a)(2) and/or Regulation D promulgated thereunder, as a transaction not involving a public offering.
As
of the effective date, the license did not meet the recognition criteria for an intangible asset under U.S. GAAP, as it did not provide
probable future economic benefits independent of the KMX VMD Units, which are expected to be acquired only upon the commencement of operations
at the Company’s planned facility. Accordingly, the Company initially recognized a liability of $
Private Placement Agreement
On
December 31, 2024, the Company entered into binding term sheets with certain investors pursuant to which the Company has agreed to sell,
and the Investors have agreed to purchase, Company securities for an aggregate amount of $
As the Business Combination has been accounted for as a reverse recapitalization, the unaudited condensed consolidated financial statements of the merged entity reflect the continuation of Legacy Stardust Power, Inc. financial statements. Legacy Stardust Power’s equity has been retroactively adjusted to the earliest period presented to reflect the legal capital of the legal acquirer, GPAC II. As a result, the number of shares was also retrospectively adjusted for periods ended prior to the Business Combination.
Shares Issued at Inception
At March 16, 2023 (inception of Legacy Stardust Power), certain employees and service providers participated in the purchase of restricted Common Stock of Legacy Stardust Power aggregating to shares. Out of the total, certain restricted stock vested immediately and remaining unvested restricted stock aggregating to shares vests over months subject to service conditions and accelerated vesting upon certain events. The agreements also contain a repurchase option noting that if the employee or service provider is terminated, for any reason, the Company has the right and option to repurchase the service provider’s unvested restricted Common Stock. Since all shareholders purchased the shares at par value and the shares had no incremental value beyond the par value as at that date, during the three months ended September 30, 2025 and 2024, the stock based compensation expense impact is insignificant. As at September 30, 2025, all the shares had been fully vested. Any shares subject to repurchase by the Company are not deemed, for accounting purposes, to be outstanding until those shares vest. The amount to be recorded as liabilities associated with shares issued with repurchase rights were immaterial as at September 30, 2025 and December 31, 2024.
SCHEDULE OF RESTRICTED STOCK ACTIVITY
| Restricted Stock | ||||||||
| Number of shares | Weighted Average Grant-Date Fair Value | |||||||
| Unvested as of December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Vested | ( | ) | ||||||
| Forfeited | ||||||||
| Unvested as of September 30, 2025 | $ | |||||||
| 14 |
2023 Equity Incentive Plan
At March 16, 2023 (inception), the Legacy Stardust Power stockholders approved the 2023 Equity Incentive Plan and shares of the Company’s Common Stock were reserved for issuance thereunder. During the year ended December 31, 2024, the Board adopted a resolution to increase the number of shares of Common Stock authorized for issuance under the 2023 Equity Incentive Plan by shares of Common Stock. During the three months and nine months ended September 30, 2025, there were grants under the 2023 Equity Incentive Plan.
Stock Options
During October and November 2023, Legacy Stardust Power granted options for shares of stock options under the 2023 Equity Incentive Plan, options were granted to employees, and options were granted to a consultant. The employee grants vest over a period of to years, and the consultant grant vests over months. The options granted to both employees and the consultant were exercisable at the exercise price of $.
All
the options under the 2023 Equity Incentive Plan were early-exercised by grantees. Accordingly, the Company received a total amount of
$
On
December 14, 2023, the Company repurchased unvested shares that were granted to an employee under the 2023 Equity Incentive Plan
at the original exercise price of $. The Company repaid a total amount of $
During the year ended December 31, 2024, the Company repurchased unvested shares that were granted to a consultant and unvested shares that were granted to an employee under the 2023 Equity Incentive Plan at the original exercise price of $.
During the nine months ended September 30, 2025, the Company repurchased unvested shares that were granted to an employee under the 2023 Equity Incentive Plan at the original exercise price of $.
The early exercised shares liability amounting to $ and $ is outstanding as at September 30, 2025, and December 31, 2024, respectively, and is presented under “Early exercised shares option liability” on the unaudited condensed consolidated balance sheet.
SCHEDULE OF STOCK OPTION ACTIVITY
| Number of shares | Weighted Average Grant-Date Fair Value | |||||||
| Unvested as at December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Vested | ( | ) | ||||||
| Forfeited | ( | ) | ||||||
| Unvested as at September 30, 2025 | $ | |||||||
The
total compensation expense for stock options recognized in the General and administrative expenses of the Company’s unaudited condensed
consolidated statements of operations were $
| 15 |
As at September 30, 2025, total unvested compensation cost for stock options granted to employees not yet recognized was $. The Company expects to recognize this compensation over a weighted average period of approximately years.
Restricted Stock Units
During April and June 2024, Legacy Stardust Power granted restricted stock units (“2023 Plan RSUs”) to employees under the 2023 Equity Incentive Plan. These 2023 Plan RSUs are subject to a service-based vesting requirement, and a liquidity plus service-based vesting requirement, which is defined as completion of a go public transaction or change in control. In order for any shares to vest, both the service-based vesting requirement and the liquidity plus service-based vesting requirement must be satisfied with respect to such shares. The liquidity conditions were met on July 8, 2024 upon consummation of the Business Combination, and therefore compensation expenses related to these awards began to be recognized in the year ended December 31, 2024 using a graded vesting method over the requisite service period.
Given the absence of a public trading market prior to the closing of the Business Combination, the Legacy Stardust Power board of directors considered numerous objective and subjective factors to determine the fair value of its common stock at each grant date. These factors included, but were not limited to: (i) independent contemporaneous third-party valuations of common stock; (ii) the prices for the Company’s convertible notes sold to outside investors; (iii) the rights and preferences of convertible preferred stock relative to common stock; (iv) the lack of marketability of its common stock; (v) developments in the business; and (vi) the likelihood of achieving a liquidity event, such as an IPO, given prevailing market conditions. Subsequent to the closing of the Business Combination, the fair value of common stock is based on the closing price of the Company’s common stock, as reported on Nasdaq on the date of grant.
SCHEDULE OF RESTRICTED STOCK ACTIVITY
| Number of shares | Weighted Average Grant-Date Fair Value | |||||||
| Unvested as at December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Vested | ( | ) | ||||||
| Forfeited | ||||||||
| Unvested as at September 30, 2025 | $ | |||||||
The
total compensation expense for RSU recognized in the General and administrative expenses of the Company’s unaudited condensed consolidated
statements of operations was $
The
total compensation expense for RSU recognized in the General and administrative expenses of the Company’s unaudited condensed consolidated
statements of operations was $
As at September 30, 2025, total unvested compensation cost for RSUs granted to employees not yet recognized was $. The Company expects to recognize this compensation over a weighted average period of approximately years.
| 16 |
2024 Equity Incentive Plan
The Board adopted, and the stockholders of the Company approved, the 2024 Equity Incentive Plan in September 2024. The maximum number of shares with respect to one or more awards that may be granted to any one participant during any calendar year shall be shares of Common Stock. The 2024 Equity Incentive Plan provides for the grant of stock options, RSUs, PSUs share appreciation rights, restricted shares, dividend equivalents, substitute awards, and other share or cash-based awards (such as cash bonus awards and performance awards) for issuance to employees or consultants of the Company (or any of the Company’s parents or subsidiaries), or directors of the Company.
During the year ended December 31, 2024, the Company granted (a) RSUs to independent directors, officers, employees and consultants which are subject to a service based vesting requirement, (b) RSUs fully vested as of the date of grant to consultants and (c) PSUs to employees with a service and market condition.
During the nine month period ended September 30, 2025, the Company granted to employees (a) RSUs which are subject to a service based vesting requirement, (b) RSUs fully vested as of the date of grant to employees and (c) RSUs fully vested as of the date of grant to consultants.
The PSUs cliff vest at the end of a three-year term subject to share price-based market condition (i.e., the volume weighted average price of the Common Stock is greater than or equal to $ per share for a period of 20 trading days in any 30 trading day period or there is a change of control, or the PSUs are otherwise forfeited). The compensation expense for these RSUs and PSUs were recognized on a straight-line basis over the term of the award.
The grant date fair value of RSUs is based on the closing price of the Company’s Common Stock, as reported on The Nasdaq Capital Market on the date of grant.
SCHEDULE OF RESTRICTED STOCK ACTIVITY
| Number of shares | Weighted Average Grant-Date Fair Value | |||||||
| Unvested as at December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Vested | ( | ) | ||||||
| Forfeited | ( | ) | ||||||
| Unvested as at September 30, 2025 | $ | |||||||
The
total compensation expense for RSUs recognized in the General and administrative expenses of the Company’s consolidated statements
of operations was $
The
total compensation expense for RSUs recognized in the General and administrative expenses of the Company’s consolidated statements
of operations was $
As at September 30, 2025, total unvested compensation cost for RSUs granted to employees and non-employee directors not yet recognized was $. The Company expects to recognize this compensation over a weighted average period of approximately years.
As at September 30, 2025, total unvested compensation cost for RSUs granted to the consultants not yet recognized was $. We expect to recognize this compensation over a period of approximately years.
| 17 |
SCHEDULE OF ESTIMATED GRANT DATE FAIR VALUE OF PSU
| Assumptions | ||||
| Fair value of Common Stock | $ | |||
| Selected volatility | % | |||
| Risk-free interest rate | % | |||
| Contractual terms (years) | ||||
SCHEDULE OF PERFORMANCE SHARES UNITS ACTIVITY
| Number of shares | Weighted Average Grant-Date Fair Value | |||||||
| Unvested as at December 31, 2024 | $ | |||||||
| Granted | ||||||||
| Vested | ||||||||
| Forfeited | ||||||||
| Unvested as at September 30, 2025 | $ | |||||||
The total compensation expense for PSUs recognized in the General and administrative expenses of the Company’s consolidated statements of operations was $ and $ for the nine months ended September 30, 2025, and 2024, respectively.
The total compensation expense for PSUs recognized in the General and administrative expenses of the Company’s consolidated statements of operations was $ and $ for the three months ended September 30, 2025, and 2024, respectively.
As at September 30, 2025, total unvested compensation cost for PSUs granted to employees not yet recognized was $. The Company expects to recognize this compensation over a weighted average period of approximately years.
NOTE 6 – ACCOUNTING FOR WARRANT LIABILITY
The
Company established the initial fair value of the Private and Public Warrants on July 8, 2024, the date of consummation of the
Business Combination, and revalued the warrants on September 30, 2025. Each 10 Warrants entitle the holder to purchase one share of
Common Stock at an exercise price of $
Each
10 Warrants entitle the holder to purchase one share of Common Stock at an exercise price of $
| 18 |
The Company, in no event later than twenty (20) Business Days after the closing of its initial Business Combination, shall use its commercially reasonable efforts to file with the Commission a registration statement for the registration, under the Securities Act, of the Ordinary Shares issuable upon exercise of the warrants. The Company shall use its commercially reasonable efforts to cause the same to become effective within sixty (60) Business Days following the closing of its initial Business Combination and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration or redemption of the warrants in accordance with the provisions of this Agreement.
If any such registration statement has not been declared effective by the sixtieth (60th) Business Day following the closing of the Business Combination, holders of the warrants shall have the right, during the period beginning on the sixty-first (61st) Business Day after the closing of the Business Combination and ending upon such registration statement being declared effective by the Commission, and during any other period when the Company shall fail to have maintained an effective registration statement covering the issuance of the Ordinary Shares issuable upon exercise of the warrants, to exercise such warrants on a “cashless basis,” by exchanging the warrants (in accordance with Section 3(a)(9) of the Securities Act or another exemption) for that number of Ordinary Shares equal to the lesser of:
(A) the quotient obtained by dividing (x) the product of the number of Ordinary Shares underlying the warrants, multiplied by the excess of the Fair Market Value less the warrant Price by (y) the Fair Market Value and
(B) per warrant (“a settlement cap” for accounting purposes).
The Private Warrants have terms and provisions that are identical to those of the Public Warrants. However, the Private Warrants are not redeemable by the Company as long as they are held by the Sponsor or its permitted transferees. If the Private Warrants are held by holders other than the Sponsor or its permitted transferees, the Private Warrants will be redeemable by the Company in all redemption scenarios and exercisable by the holders on the same basis as the Public Warrants.
The Company’s warrants are not indexed to the Company’s Common Stock in the manner contemplated by ASC Section 815-40-15 because the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. Further, there is a settlement cap for Public Warrants, and Private Warrants upon transfer from Sponsor or permitted transferees to other holders, if the holder elects to exercise warrants on a cashless basis if the Company fails to maintain an effective registration statement covering the Common Stock issuable upon warrant exercises throughout the term of the warrants. Maintenance of an effective registration statement is not an input to the fair value option model for a fixed-for-fixed option or forward. As such, the Company’s warrants are accounted for as derivative warrant liabilities which are required to be valued at fair value at each reporting period.
The following tables present information about the Company’s warrant liabilities that are measured at fair value on a recurring basis at September 30, 2025 and December 31 2024, and indicate the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
SCHEDULE OF WARRANT LIABILITIES THAT ARE MEASURED AT FAIR VALUE ON A RECURRING BASIS
| Description | At September 30, 2025 | Quoted price in active markets (level 1) | Significant other observable input (level 2) | Significant other unobservable input (level 3) | ||||||||||||
| Warrant liability | ||||||||||||||||
| Public warrants | $ | $ | $ | $ | ||||||||||||
| Private warrants | ||||||||||||||||
| Total Warrant liability | $ | $ | $ | $ | ||||||||||||
| 19 |
| Description | At December 31, 2024 | Quoted price in active markets (level 1) | Significant other observable input (level 2) | Significant other unobservable input (level 3) | ||||||||||||
| Warrant liability | ||||||||||||||||
| Public warrants | $ | $ | $ | $ | ||||||||||||
| Private warrants | ||||||||||||||||
| Total Warrant liability | $ | $ | $ | $ | ||||||||||||
At September 30, 2025 and December 31, 2024, the Company valued its Public Warrants by reference to the publicly traded price of the Public Warrants. The Company valued its Private Warrants based on the closing price of the Public Warrants since they are similar instruments.
The warrant liabilities are not subject to qualified hedge accounting. The Company’s policy is to record transfers between levels at the end of the reporting period. There were no transfers during the three and nine months ended September 30, 2025.
NOTE 7 – INVESTMENT IN EQUITY SECURITIES
In
October 2023, Legacy Stardust Power subscribed to and purchased ordinary shares (
The Company neither has a controlling financial interest nor does it exercise significant influence over QXR. Accordingly, the investment in QXR’s ordinary shares does not result in either the consolidation or application of equity method of accounting for the Company.
QXR’s
ordinary shares are listed on the ASX with a readily determinable fair value and change in fair value is recognized in the unaudited
condensed consolidated statement of operations. Accordingly, the investment in these securities has been recorded at cost at initial
recognition and at fair value of $
In
December 2024, Stardust Power subscribed to and purchased
ordinary shares (approximately
| 20 |
IRIS
Metals’ ordinary shares are listed on the Australian Securities Exchange (ASX) with a readily determinable fair value, and
changes in fair value are recognized in the consolidated statements of operations. The investment in these securities was initially
recognized at cost and subsequently measured at fair value. As of September 30, 2025, the Company no longer held any investment in
IRIS Metals, compared to fair value of $
NOTE 8 – SIMPLE AGREEMENT FOR FUTURE EQUITY (SAFE NOTES)
On June 6, 2023, Legacy Stardust Power received $ in cash from a single investor and funded a SAFE note on August 15, 2023. The funds were received from an unrelated third party, through its entity which is currently being managed under the purview of an investment management agreement between them and VIKASA Capital Advisors, LLC (a related party) in consideration for which VIKASA Capital Advisors, LLC is paid-investment management fees.
On
November 20, 2023, Legacy Stardust Power received an additional $
in cash from a single investor, which, along with the $
deposit received in September 2023, funded a new $ SAFE note. On February 23, 2024, the Company entered into a third SAFE note and received an additional $
The
SAFE notes were classified as a liability based on evaluating characteristics of the instrument and is presented at fair value as a non-current
liability in the Company’s unaudited condensed consolidated balance sheets. The SAFE notes provide the Company an option to call
for additional preferred stock up to $
On
March 21, 2024, Legacy Stardust Power entered into a financing commitment and equity line of credit agreement with American Investor
Group Direct LLC (“AIGD”). The agreement replaced the above contingent commitment feature of the SAFE notes, granting the
Company an option to drawdown up to an additional $
The estimated fair value of the SAFE notes considered the timing of issuance and whether there were changes in the various scenarios since issuance. Pursuant to the consummation of the Business Combination, the SAFE notes converted into
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NOTE 9 – CONVERTIBLE NOTES
On
April 24, 2024, Legacy Stardust Power entered into a convertible equity agreement (“Convertible Notes”) for $
Pursuant to the consummation of the Business Combination and in accordance with the terms of the convertible equity agreements, the Convertible Notes converted into
NOTE 10 – FAIR VALUE MEASUREMENTS
The following tables summarize the Company’s assets and liabilities that are measured at fair value in the unaudited condensed consolidated financial statements:
SCHEDULE OF ASSETS AND LIABILITIES ARE MEASURED AT FAIR VALUE
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Fair Value Measurements as at December 31, 2024 | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Other noncurrent assets: | ||||||||||||||||
| Investment in equity securities (a) | $ | $ | $ | $ | ||||||||||||
| Total financial assets | $ | $ | $ | $ | ||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Fair Value Measurements as at September 30, 2025 | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Other noncurrent assets: | ||||||||||||||||
| Investment in equity securities (a) | $ | $ | $ | $ | ||||||||||||
| Total financial assets | $ | $ | $ | $ | ||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Fair Value Measurements as at December 31, 2024 | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Liabilities | ||||||||||||||||
| Sponsor earnout shares (b) | $ | $ | $ | $ | ||||||||||||
| Total financial liabilities | $ | $ | $ | $ | ||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Fair Value Measurements as at September 30, 2025 | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Liabilities | ||||||||||||||||
| Sponsor earnout shares (b) | $ | $ | $ | $ | ||||||||||||
| Total financial liabilities | $ | $ | $ | $ | ||||||||||||
| (a) | |
| (b) |
The make-whole obligation liability related to the Purchase Agreement is measured at fair value categorized within Level 1 of the fair value hierarchy. See Note 4. |
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The following table provides a reconciliation of activity and changes in fair value for the Company’s SAFE notes, convertible notes and sponsor earnout liability:
SCHEDULE OF RECONCILIATION OF ACTIVITY AND CHANGES IN FAIR VALUE
| SAFE notes at fair value | Convertible notes at fair value | Sponsor earnout liability at fair value | ||||||||||
| Balance as at December 31, 2023 | $ | $ | $ | |||||||||
| Issuance of notes | ||||||||||||
| Change in fair value | ||||||||||||
| Balance as at March 31, 2024 | $ | $ | $ | |||||||||
| Issuance of notes | ||||||||||||
| Change in fair value | ||||||||||||
| Balance as at June 30, 2024 | $ | $ | $ | |||||||||
| Issuance of common stock upon conversion | ( | ) | ( | ) | ||||||||
| Sponsor earnout liability recognized on closing of Business Combination | ||||||||||||
| Change in fair value | ( | ) | ||||||||||
| Balance as at September 30, 2024 | $ | $ | $ | |||||||||
| Change in fair value | ( | ) | ||||||||||
| Balance as at December 31, 2024 | $ | $ | $ | |||||||||
| Change in fair value | ( | ) | ||||||||||
| Balance as at March 31, 2025 | $ | $ | $ | |||||||||
| Change in fair value | ||||||||||||
| Balance as at June 30, 2025 | $ | $ | $ | |||||||||
| Change in fair value | ||||||||||||
| Balance as at September 30, 2025 | $ | |||||||||||
The valuation of the Level 3 measurement for SAFE notes considered the probabilities of the occurrence of the scenarios as discussed in Note 2 of the audited consolidated financial statements and notes thereto for the period March 16, 2023 (inception) to December 31, 2023, included in the Company’s Registration Statement on Form S-4/A filed with the SEC on May 8, 2024. The Company valued the SAFE notes based on the occurrence of the preferred financing or a SPAC transaction. As of the date of initial measurement and December 31, 2023, the management has assigned zero probability for a change in control event or a dissolution event. Pursuant to the consummation of the Business Combination and in accordance with the terms of the SAFE note agreements, the SAFE notes and convertible notes converted into and shares of the Company’s Common Stock.
NOTE 11 – SEGMENT REPORTING
The Company reports segment information in the same way management internally organizes the business in assessing performance and making decisions regarding allocation of resources in accordance with ASC 280, “Segment Reporting”. The Company has a single reportable operating segment which operates as a single business platform. In reaching this conclusion, management considered the definition of the Chief Operating Decision Maker (“CODM”), how the business is defined by the CODM, the nature of the information provided to the CODM, how the CODM uses such information to make operating decisions, and how resources and performance are assessed. The Company’s CODM is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company has a single, common management team and our cash flows are reported and reviewed with no distinct cash flows.
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In addition to the significant expense categories included within net loss presented on the Company’s consolidated statements of operations, see below for disaggregated amounts that comprise general and administrative expenses.
SCHEDULE OF SEGMENT REPORTING CONSOLIDATED STATEMENTS OF OPERATIONS
| September 30, 2025 | September 30, 2024 | September 30, 2025 | September 30, 2024 | |||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2025 | September 30, 2024 | September 30, 2025 | September 30, 2024 | |||||||||||||
| Payroll and related taxes | $ | $ | $ | $ | ||||||||||||
| Professional and consulting fees | ||||||||||||||||
| Legal fees | ||||||||||||||||
| Insurance | ||||||||||||||||
| Other | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
NOTE 12 – RELATED PARTY TRANSACTIONS
On
September 18, 2024, the Company entered into a consulting agreement with DRE Chicago LLC, whose principal is Paramita Das. Ms. Das was
onboarded as a Chief Strategy Officer and Senior Advisor to CEO of the Company. Additionally, in December 2024, the Company entered into
a binding term sheet with DRE Chicago LLC, providing for loan in the principal amount of $
In
December 2024, the Company entered into a binding term sheet (“Term Sheet”) with Endurance Antarctica Partners II, LLC (“Endurance”)
an affiliate of a director at the time and a shareholder, providing for a loan (the “Loan”) in the aggregate principal amount
of $
In
March 2023, the Company entered into unsecured notes payable with three related parties. These notes payable provided the Company the
ability to draw up to $
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The Company incurred the following expenses with related parties, which were all affiliates of the Company:
SCHEDULE OF EXPENSES WITH RELATED PARTIES
| Expense type | Three months ended September 30, 2025 | Three months ended September 30, 2024 | Nine months ended September 30, 2025 | Nine months ended September 30, 2024 | ||||||||||||||
| Expenses under contract due to: | ||||||||||||||||||
| Energy Transition Investors LLC | Interest | $ | $ | $ | ||||||||||||||
| DRE Chicago LLC | Interest | |||||||||||||||||
| Endurance Antarctica Partners II, LLC | Interest | |||||||||||||||||
| Total expenses | $ | $ | $ | |||||||||||||||
The Company entered into notes payable agreements of with related parties, all of whom were affiliates.
SCHEDULE OF RELATED PARTIES
As of September 30, 2025 | As of December 31, 2024 | |||||||||
| DRE Chicago LLC | Interest Accrued | $ | $ | |||||||
| Endurance Antarctica Partners II, LLC | Interest Accrued | |||||||||
| Energy Transition Investors LLC | Interest Accrued | |||||||||
| DRE Chicago LLC* | Short-term loan* | |||||||||
| Endurance Antarctica Partners II, LLC* | Short-term loan* | |||||||||
| Notes obtained from related parties | $ | $ | ||||||||
| * |
In
March 2025, the Company repaid the loan principal amount of $
NOTE 13 - ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES:
SCHEDULE OF ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES
| September 30, 2025 | December 31, 2024 | |||||||
| Accrued expenses | $ | $ | ||||||
| Capital market advisory fees | ||||||||
| Personnel related liabilities | ||||||||
| Accrued Interest | ||||||||
| Total | $ | $ | ||||||
NOTE 14 – SHORT-TERM LOANS
Insurance funding borrowing
On
August 5, 2025, the Company entered into a financing agreement of $
On
July 18, 2024, the Company entered into a financing agreement of $
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On
November 19, 2023, the Company entered into a financing agreement of $
Other short-term loans
In
December 2024, the Company entered into a binding Term Sheet (“Term Sheet”) with Endurance Antarctica Partners II, LLC
(“Endurance”), a related party, providing for a loan (the “Loan”) in the aggregate principal amount of
$
In
December 2024, the Company entered into binding Term Sheets (“Term Sheets”) with several lenders including DRE Chicago LLC,
a related party (collectively, the “Lenders”), providing for loans (the “Loans”) in the aggregate principal amount
of $
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The
Company recognized interest expense of $ and $
The following table summarizes the Company’s outstanding short-term loan arrangements:
SCHEDULE OF SHORT TERM LOAN ARRANGEMENTS
| September 30, 2025 | December 31, 2024 | |||||||
| Insurance funding loan | $ | $ | ||||||
| Short-term loans from related parties (See Note 12) | ||||||||
| Other short-term loans | ||||||||
| Total | $ | $ | ||||||
NOTE 15 – PROMISSORY NOTES AND WRITE-OFFS
On
March 13, 2024, Legacy Stardust Power and IGX Minerals LLC (“IGX”), entered into an exclusive letter of intent (the “IGX
LOI”) to potentially acquire interests in certain mining claims (the “IGX Claims”). The Company paid a non-refundable
payment of $
On
August 19, 2024, Legacy Stardust Power entered into a promissory note arrangement with IGX (the “IGX Note”) for $
On
March 15, 2024, Legacy Stardust Power and Usha Resources Ltd. (“Usha Resources”) entered into a non-binding Letter of Intent
(the “Jackpot LOI”), except for certain binding terms such as those relating to the exclusivity period until September 30,
2025, as extended, to acquire an interest in Usha Resources’ lithium brine project, situated in the United States. Usha Resources
is an established lithium developer with multiple projects in development. The Jackpot Lake Lithium Brine Project is a flagship asset
of Usha Resources and is a lithium brine asset located in the United States, comprised of 8,714 acres of property. The project is currently
engaged in its maiden drill program. The Jackpot LOI provides Stardust Power with the exclusive option to agree to acquire up to 90%
of the interests held by Usha Resources in the Jackpot Lake project, based on an indicative earn-in schedule. As part of a definitive
agreement, Stardust Power would be required to invest into the development of the Jackpot Lake project. The Company has made a non-refundable
payment of $
NOTE 16 – SUBSEQUENT EVENTS
On October 20, 2025, the Company entered into a non-binding
letter agreement with Prairie Lithium Limited (“Prairie”), an Australia-based company, for the supply of
On October 31, 2025, the Company entered into a non-binding
letter agreement with Mandrake Resources Limited (“Mandrake”), an Australia-based company, for the supply of
The Company has evaluated subsequent events through the date the consolidated financial statements were available to be issued and there are no other items that would have had a material impact on the Company’s unaudited condensed consolidated financial statements.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of the financial condition and results of operations should be read together with our unaudited condensed consolidated financial statements for the three months ended September 30, 2025, and the related notes thereto contained elsewhere in this Quarterly Report.
Unless the context otherwise requires, all references in this section to “we,” “us,” “our,” or the “Company”, “Stardust” or “Stardust Power” refer to Stardust Power Inc. and its consolidated subsidiaries at or after the consummation of the business combination (the “Business Combination”). Terms otherwise not defined herein, have the meaning given to such terms in the Proxy Statement/Prospectus in the section titled “Certain Defined Terms” beginning on page iii thereof, and such definitions are incorporated herein by reference.
Cautionary Note Regarding Forward-Looking Statements
Certain of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors described or referenced in this Quarterly Report under the heading “Risk Factors,” our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. You should carefully read the section titled “Risk Factors” in this Quarterly Report to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements. Please also see the section titled “Cautionary Statement Regarding Forward-Looking Statements” in this Quarterly Report.
Company Overview and History
On December 5, 2022, Stardust Power LLC was organized as a limited liability company in the State of Delaware. On March 16, 2023, Stardust Power Operating Inc. (f/k/a Stardust Power Inc. prior to the consummation of the Business Combination, “Legacy Stardust Power”) was organized as a corporation in the State of Delaware with operations commencing on March 16, 2023. The ownership interests of Stardust Power LLC were subsequently transferred to Stardust Power Inc. On July 8, 2024, former Stardust Power Inc. was renamed Stardust Power Operating Inc.
Stardust Power is a U.S. based development stage battery grade lithium manufacturer designed to foster clean energy independence for America. The Company is in the process of creating capacity to manufacture battery grade lithium carbonate for the electric vehicle (“EV”) and energy Storage systems (“ESS”) markets, by developing a large-scale lithium refinery in the United States. Stardust Power seeks to become a sustainable, cost-effective supplier of battery grade lithium carbonate, by its innovative approach in the development of a large central refinery optimized for multiple inputs of lithium brine inputs (the “Facility”) in Oklahoma.
Stardust Power intends to source lithium chloride feedstock from various suppliers and may make investments upstream to secure additional feedstock. We seek to sell our products to EV manufacturers as our primary market, with potential applications in other areas such as battery manufacturers, the U.S. military, and original equipment manufacturers (“OEMs”).
Some of the key driving factors are the demand for battery grade lithium products, fuelled largely by the demand and production of electric vehicles and automotive OEMs and battery manufacturers seeking domestic supply options, leading to demand for minerals used in battery cells, such as lithium, governmental incentives for American manufacturing and evolving geopolitical climate that is creating a national security priority for the U.S. market.
In February 2023, Stardust Power LLC received an illustrative incentive analysis for up to $257 million in performance-based incentives from the State of Oklahoma and potential federal incentives, which also contained potential for further eligible federal grants. The state incentives were based on initial job creation, equipment procurement, training and recruitment incentives, property tax exemptions, sales tax exemptions, and capital expenditure projections submitted to the Oklahoma Department of Commerce in the first quarter of 2023 and could be subject to changes as the Company would progress in setting up the Facility and commercial production of battery grade lithium in the future. These incentives may change based on the actual financial metrics of the Company in the future, which may be lower or higher.
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Stardust Power believes that it is well poised to address these opportunities by emerging as a leading, fully integrated domestic lithium supplier, and contribute to restoring American energy independence, thereby bridging the gap in the domestic supply of battery grade lithium products.
Recent Developments
Purchase and Sale Agreement for Site
On January 10, 2024, Stardust Power entered into a purchase and sale agreement with the City of Muskogee to purchase the site in Southside Industrial Park, Muskogee, Oklahoma for a total of $1,662,030. On December 16, 2024, the agreement was finalized and the title to the land was transferred in the Company’s name.
Recent financing activity
On December 31, 2024, the Company entered into binding term sheets with certain investors pursuant to which the Company has agreed to sell, and the Investors have agreed to purchase, Company securities for an aggregate amount of $550,000 (the “Private Placement”). The proceeds of the Private Placement are expected to be used by the Company for capital expenditures, working capital and general corporate purposes. The Investors have agreed to purchase, and the Company has agreed to issue and sell, up to $550,000 in shares of Common Stock at a price equal to 95% of the closing bid price of the Common Stock on the last trading day prior to the closing date for the Private Placement. In addition, each Investor will receive warrants representing the right, exercisable within five years of the closing date, to purchase up to 50% of the shares of Common Stock purchased by such Investor in the Private Placement, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00. The Company received proceeds of $425,000 in December 2024 and additional proceeds of $125,000 in January 2025 from investors. The Company has accounted for this as Advance from PIPE investor for shares and warrants to be issued based on purchase agreement to be entered on the unaudited condensed consolidated balance sheet as of December 31, 2024. On April 24, 2025, the Company issued 12,850 shares of Common Stock and 64,251 Warrants to the investors.
On January 27, 2025, the Company consummated a public offering of 479,200 shares of common stock and accompanying warrants to purchase up to 479,200 shares of common stock at a combined public offering price of $12.00 per share and warrant, generating aggregate gross proceeds of approximately $5,750,000 before offering expenses. The common stock purchase warrants, exercisable in lots of 10 warrants at $13.00 per share and expiring five years from issuance, were issued under an effective registration statement on Form S-1 (File No. 333-284298), filed by the Company with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”), that became effective on January 23, 2025.
On March 16, 2025, the Company entered into a letter agreement (the “Inducement Letter”) with a warrant holder (the “Exercising Holder”) providing for the immediate cash exercise of outstanding warrants to purchase 479,200 shares of the Company’s Common Stock at a reduced exercise price of $6.20 per share. In connection with such exercise, the Company agreed to issue new common stock purchase warrants (the “Inducement Warrants”) to purchase up to 958,400 shares of common stock at an exercise price of $7.00 per share, subject to shareholder approval and Nasdaq rules. The Company received gross proceeds of approximately $2,971,040 on March 18, 2025, and used the net proceeds for working capital and general corporate purposes. No exercises of the Inducement Warrants have occurred as of the date on which these unaudited condensed consolidated financial statements were available to be issued.
On June 18, 2025, the Company consummated a public offering of 2,150,000 shares of Common Stock at a public offering price of $2.00 per share, generating aggregate gross proceeds of approximately $4,300,000 before underwriting discounts and other offering expenses. The offering was conducted pursuant to a firm commitment underwriting agreement entered into with the underwriters, on June 17, 2025. The offering was made under an effective registration statement on Form S-1 (File No. 333-287939), which was declared effective by the SEC on June 16, 2025. In connection with the offering, the Company granted the underwriter a 45-day option to purchase up to an additional 322,500 shares of Common Stock to cover over-allotments, if any. On June 25, 2025, the underwriter partially exercised the over-allotment option, purchasing an additional 110,000 shares at the same public offering price, resulting in additional gross proceeds of approximately $220,000. After giving effect to the partial exercise of the over-allotment option, the aggregate gross proceeds from the offering increased to approximately $4,520,000, before deducting underwriting discounts and estimated offering expenses of $574,325. The Company used the net proceeds from the offering to support the completion of the Front End Loading-3 (”FEL-3”) study related to its proposed lithium processing facility in Muskogee, Oklahoma, and for general working capital purposes.
Subsequent to the quarter end, the Company entered into the Exchange Agreement) with a the Investor. Pursuant to the Exchange Agreement, the Investor agreed to irrevocably exchange all of its warrants to purchase shares of Common Stock, originally issued on March 16, 2025, representing the right to purchase an aggregate of 958,400 shares of Common Stock, for newly issued shares of Common Stock at an exchange ratio of 1.31 Warrant Shares for 1 share of Common Stock, resulting in the issuance to the Investor of 730,689 shares of Common Stock at closing.
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Recent Supply agreements
On October 20, 2025, the Company entered into a non-binding letter agreement with Prairie Lithium Limited (“Prairie”), an Australia-based company, for the supply of 6,000 metric tons per annum of lithium carbonate equivalent in the form of lithium chloride. The initial contract term would span 6 years starting from the date on which first commercial shipment is received by the Company, with the option for the Company to renew for two additional six-year terms.
On October 31, 2025, the Company entered into a non-binding letter agreement with Mandrake Resources Limited (“Mandrake”), an Australia-based company, for the supply of 7,500 metric tons per annum of lithium carbonate equivalent in the form of lithium chloride. The initial contract term would span 12 years starting from the date on which first commercial shipment is received by the Company, with the option for the Company to renew for an additional six-year term.
Engineering Agreement
On August 4, 2024, the Company entered into an engineering agreement (the “Primero Agreement”) with Primero USA, Inc. (“Primero”) pursuant to which Primero agreed to provide certain engineering, design and consultancy professional services, including to assist in procurement of major equipment, engage relevant third parties for construction and provide a Front End Loading-3 (“FEL-3”) report of the Company’s Lithium Facility at Southside Industrial Park in Muskogee, Oklahoma. The total amount due pursuant to the Primero Agreement, assuming full performance, is approximately $4.7 million, in the aggregate, subject to customary potential adjustments.
In August 2025, the Company announced the successful completion of the FEL-3 report. The report delivered an advanced design with key optimizations to improve efficiency, reduce costs, and strengthen overall project economics. According to the FEL-3 report, Phase 1 is planned at 25,000 metric tons per annum (mtpa) of battery-grade lithium, with estimated capital expenditures of approximately $500 million, at a 90% probability of achievement. This figure includes owner’s cost, contingency, and escalation. Construction is expected to take approximately 24 months from the start of major work to mechanical completion.
Investment in IRIS Metals Limited
In December 2024 Stardust Power subscribed to and purchased 10,000,000 ordinary shares (approximately 6% of the total equity) of IRIS Metals Limited (“IRIS Metals”), an Australian limited company whose ordinary shares are listed on the Australian securities exchange (“ASX”) for $1,600,000. This investment in the ordinary shares if IRIS Metals allows the Company to explore strategic partnership with, or investment in, IRIS Metals, including without limitation, a commercial off take arrangement for battery grade lithium production, financing or other investments in IRIS Metals or its affiliates. No formal off take agreement has been executed as at September 30, 2025. IRIS Metals’ ordinary shares are listed on the Australian Securities Exchange (ASX) with a readily determinable fair value, and changes in fair value are recognized in the consolidated statements of operations. During the nine months ended September 30, 2025, management determined that a strategic investment in IRIS Metals was no longer viable. As a result, the Company sold all its investment in IRIS Metals for total proceeds of $570,255. The Company recognized a loss on sale of investments of $84,626 and $179,805 for the three and nine months ended September 30, 2025, respectively. The carrying amount of the shares sold was $750,060. Following the sale, the Company no longer holds any investment in IRIS Metals as of September 30, 2025.
The investment in these securities was initially recognized at cost and subsequently measured at fair value. As of September 30, 2025, the fair value of the investment was $Nil, compared to $1,461,715 as of December 31, 2024. The Company recognized a loss of $Nil and $711,655 for the three and nine months ended September 30, 2025, respectively, due to the change in fair value of securities, as reported in the unaudited condensed consolidated statements of operations.
Offtake and licensing agreements
On January 28, 2025, the Company entered into a non-binding letter agreement with Sumitomo Corporations of America (“Sumitomo”), contemplating a long-term commercial offtake agreement, pursuant to which Sumitomo would agree to acquire 20,000 metric tons of lithium carbonate per year from the Company’s first line of production, with the potential to increase to 25,000 metric tons based on mutual agreement. The initial contract term would span 10 years starting from the date of the first qualification of the Company’s lithium carbonate for sale to Sumitomo’s customers, with an option for Sumitomo to renew for an additional five years under mutually agreed terms, provided written notice is given to the Company at least twelve months prior to the end of the initial term.
On February 7, 2025 (the “Effective Date”), the Company executed an exclusive license agreement (the “License Agreement”) with KMX. Under the terms of the License Agreement, KMX agreed to irrevocably license to the Company the use of KMX’s VMD Technology and associated processes and systems (including the KMX VMD Units) for the purpose of the Company’s use of the technology in its refining and upstream operations. Among other obligations set forth in the License Agreement, the Company shall be required to exclusively purchase all KMX VMD Units from KMX during the term of the License Agreement on the terms and conditions set forth therein. The License Agreement grants the Company the exclusive right to sub license, use, market, sell and operate KMX’s VMD Technology across the United States, Canada and select international markets. The Company agreed to pay KMX a royalty comprised of 50,000 shares of Common Stock (the “Royalty Shares”). The securities are being offered and sold by the Company pursuant to an exemption from the registration requirements of the Securities Act provided by Section 4(a)(2) and/or Regulation D promulgated thereunder, as a transaction not involving a public offering. As on the Effective Date of the License Agreement, the Company received the contractual right to access and purchase KMX VMD Units. On April 24, 2025, the Company issued 50,000 shares of common stock to KMX, with a corresponding debit recorded as other long-term asset, until the license meets the recognition criteria for an intangible asset.
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Short-term loans
In December 2024, the Company entered into a binding term sheet (“Term Sheet”) with Endurance Antarctica Partners II, LLC (“Endurance”) a related party, providing for a loan (the “Loan”) in the aggregate principal amount of $1,750,000, bearing interest at a rate of 15% per year, and maturing in March 2025 (the “Maturity Date”). The Term Sheet contained customary representations and warranties and customary events of default. Pursuant to the Term Sheet, 550,000 shares of Company’s Common Stock, owned by Roshan Pujari, Chief Executive Officer of the Company, were pledged as collateral. In addition, the Company has agreed to issue to Endurance $3,500,000 in Common Stock as an Equity Kicker, with the price of each share being determined based on terms per the earlier to occur of (i) the consummation of a private placement offering of Company securities (in which case such issuance shall be on no less favorable terms than the terms of such private placement) and (ii) the Maturity/ Repayment Date, provided that the minimum number of shares of Common Stock shall be no less than 50,000 shares. In addition, Endurance will receive warrants representing the right, exercisable within five years of the closing date, up to 50% of Common Stock issued as Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00 in accordance with the Private Placement terms. During the nine months ended September 30, 2025, the Company has fully repaid the principal amount, the accrued interest and issued the equity shares and warrants to Endurance.
In December 2024, the Company entered into binding term sheets (“Term Sheets”) with several lenders including DRE Chicago, LLC, a related party (collectively, the “Lenders”), providing for loans (the “Loans”) in the aggregate principal amount of $1,800,000, bearing interest at a rate of 15% per year, and maturing in March 2025 (the “Maturity Date”). The proceeds of the Loans are expected to be used by the Company for general corporate and working capital purposes. The Term Sheets contained customary representations and warranties and customary events of default. Pursuant to the Term Sheets, an aggregate of approximately 340,000 shares of Company’s Common Stock, owned by Roshan Pujari, Chief Executive Officer of the Company, were pledged as collateral. In addition, the Company has agreed to issue to the Lenders an aggregate of $2,700,000 in Common Stock as an Equity Kicker, with the price of each share being determined based on terms per the earlier to occur of (i) the consummation of a private placement offering of Company securities (in which case such issuance shall be on no less favorable terms than the terms of such private placement) and (ii) the Maturity/ Repayment Date, provided that the minimum number of shares of Common Stock issued to the Lenders shall be no less than an aggregate of 36,000 shares. In addition, the Lenders will receive warrants representing the right, exercisable within five years of the closing date, up to 50% of Common Stock issued as Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00 in accordance with the Private Placement terms. During the nine months ended September 30, 2025, the Company has fully repaid the principal amount, the accrued interest and issued the equity shares and warrants to the Lenders.
Notices from Nasdaq
On March 18, 2025, the Company received a notice (the “MVPHS Notice”) from the Nasdaq that the Company was not in compliance with the continued listing standards set forth in Nasdaq Listing Rule 5450(b)(2)(C), as the Company’s market value of publicly held shares closed below $15,000,000 for the previous 30 consecutive business days. On September 26, 2025, the Company received notice from Nasdaq that the Company has regained compliance with the continued listing standards set forth in Nasdaq Listing Rule 5450(b)(2)(C).
On March 19, 2025, the Company received a subsequent notice (the “Minimum Bid Price Notice”) from the Nasdaq that the Company was not in compliance with the continued listing standards set forth in Nasdaq Listing Rule 5450(a)(1), as the minimum bid price of the Company’s Common Stock closed below $1.00 per share for the previous 30 consecutive business days. On September 26, 2025, the Company received notice from Nasdaq that the Company has regained compliance with the continued listing standards set forth in Nasdaq Listing Rule 5450(a)(1).
On April 3, 2025, the Company received a subsequent notice (the “MVLS Notice”) from the Nasdaq that the Company was not in compliance with the continued listing standards set forth in Nasdaq Listing Rule 5450(b)(2)(A), as the market value of the Company’s listed securities fell under $50 million for the previous 30 consecutive business days. On October 1, 2025, the Company received a delisting notice from the Nasdaq due to failure to regain compliance with the Nasdaq Listing Rule 5450(b)(2)(A). On October 8, 2025, the Company requested a hearing before a Nasdaq Hearings Panel (the “Panel”) to appeal the delisting determination. Subsequently, pursuant to an application made by the Company to transfer to the Nasdaq Capital Market and based on market value of Company listed securities being above $35 million for a sustained period of time, on October 27, 2025, the Company received notice from the Nasdaq that the application for the transfer to the Nasdaq Capital Market has been approved and consequently the above mentioned non-compliance has been cured.
Reverse Stock Split
On September 3, 2025, the Company filed a certificate of amendment to the Company’s Certificate of Incorporation with the Secretary of State of the State of Delaware to effectuate a 1-for-10 reverse stock split (the “Reverse Stock Split”) of the outstanding shares of Common Stock. The Company’s stockholders previously approved the Reverse Stock Split at the Company’s annual meeting of stockholders held on June 9, 2025 and granted the board of directors the authority to determine the exact split ratio and when to proceed with the Reverse Stock Split. The Reverse Stock Split became effective on September 8, 2025, and the Common Stock begin trading on the Nasdaq Global Market on a Reverse Stock Split-adjusted basis on September 8, 2025 at market open. The Reverse Stock Split did not decrease the number of authorized shares of Common Stock and preferred stock or otherwise affect the par value of the Common Stock. No fractional shares were issued in connection with the Reverse Stock Split and any fractional shares resulting from the Reverse Stock Split were rounded down to the nearest whole share. Stockholders who were otherwise entitled to receive fractional shares as a result of the Reverse Stock Split were paid cash in lieu thereof. As a result of the Reverse Stock Split, shares of Common Stock, outstanding warrants, stock options, and restricted stock units were proportionately decreased (and the respective per share value and exercise prices, if applicable, were proportionately increased) (see Part I, Item 1, Note 2, Basis of Presentation and summary of significant accounting policies in the notes to unaudited condensed consolidated financial statements in this Quarterly Report).
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Key Factors Affecting Our Performance
We believe that our performance and future success depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including competition from other lithium carbonate producers, changes to existing federal and state level incentive framework, changes in regulations, and other factors discussed under the section titled “Risk Factors” in our Annual Report on Form 10-K and this Quarterly Report. We believe the factors described below are key to our success.
Commencing Commercial Operations
The Company is a development stage company, and has purchased the site in Southside Industrial Park, Muskogee, Oklahoma. We have completed a number of required site assessments and technical studies, including the critical issue analysis, Phase I ESA, geotechnical study, FEL-1 study and FEL-3 study. Additional studies may be required as the project progresses.
The project required evaluation for certain federal, state, and local permits. State permitting focuses on air emissions, wastewater, and stormwater permits. Federal permitting focuses on possible cultural, biological, and natural resources and threatened/endangered species impacts. The Company has submitted the required air emissions permit application to the Oklahoma Department of Environmental Quality and received notification that such permit is declared administratively complete and is now under technical review. The Company does not require a wastewater permit for the facility since no wastewater will be discharged and has received its stormwater permit during the year.
Stardust Power is developing a large central refinery in a phased approach. The first phase is the construction of a production line with up to 25,000 metric tons per annum (“tpa”). The second phase is to add a second production line with up to 25,000 tpa, to create a total capacity of up to 50,000 tpa.
A technological innovation of Stardust Power’s planned refinery is the ability for the Facility to refine different sources of lithium chloride inputs derived from lithium brines. The Facility is being designed to accept lithium chloride, of a certain approved chemical composition. It is Stardust Power’s intention that the Facility will be able to dilute and pre-treat feedstock as necessary, to ensure that various lithium feedstock can be blended, in order to produce a consistent feedstock. Stardust Power’s strategy is to differentiate itself by screening for a broader set of contaminants, in comparison to other lithium refineries.
Partnership Ecosystem
Our success will depend on whether we can execute and expand our ecosystem of commercial arrangements with additional suppliers of brine and executing agreements with them at favorable terms. The availability of lithium chloride for the purpose of extracting lithium is still in a nascent stage and we would require access to multiple sources as we start commercial production and grow our business. Our management team frequently evaluates current and future sources of supplies for reliability of supply and geographic locations for logistics and cost efficiency. We would also have to maintain technology arrangements with existing strategic affiliations on whose patented and proprietary processes we depend on, as well as forge new technology affiliations as exploration, extraction and purification processes evolve, to obtain raw materials required to manufacture high-quality lithium suitable for consumption by the EV industry, and other potential usages. These affiliations will enable us to refine and sell battery grade lithium at competitive prices, which in turn helps secure the growth and profitability of our business operations in the long term.
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Adequate Capital Raise
The success of our refinery’s activities relating to producing battery grade lithium from lithium chloride and the success of our ability to obtain relevant permits in a timely manner require significant capital investment and financing to fund the initial investment in all aspects of setting up the operations, and may subsequently be impacted by our operating losses, competition from substitute products and services from larger companies, protection of proprietary technology of our strategic partners, and dependence on key individuals.
Our unaudited condensed consolidated financial statements have been presented on the basis that the Company is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not earned any revenue and has been operating at a loss since inception. The Company has an accumulated deficit and stockholders’ deficit. We believe that the cash on hand and additional investments available through issuance of new Common Stock will be inadequate to satisfy the Company’s working capital and capital expenditure requirements for at least the next twelve months. These conditions raise substantial doubt about our ability to continue as a going concern for one year from the issuance of these unaudited condensed consolidated financial statements. As a development stage company, Stardust Power needs to raise additional capital to realize its business objectives. Our long-term success and ability to continue as a going concern is dependent upon our ability to successfully raise additional capital or financing, or successfully enter into strategic partnerships. Until commercial production is achieved from our planned operations, we will continue to incur operating and investing net cash outflows associated with, among other things, maintaining and acquiring exploration properties and undertaking ongoing exploration activities.
Limited Operating History
We have a limited operating history and there is limited historical financial information upon which to base an evaluation of our performance. Our business and financial condition must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered by companies in their early stages of operation.
Key Business Metrics, Non-GAAP Measure
Since we have yet to start the construction of our Facility and associated commercial production, we do not have financial information on key business metrics. However, based on our experience and industry knowledge, we expect the following would be key business metrics:
| ● | Raw Material Cost/ton: This includes the input cost of lithium chloride for the plant. As this may be obtained from various sources, the weighted average cost will be calculated to arrive at the raw material cost per ton and reflects the Company’s ability to procure high-quality raw materials at an appropriate price. The weighted average method also helps in calculating the gross margin on a per-ton basis. The technology implemented and the efficiency of the operations are also reflected on the gross margin per ton. |
| ● | Selling Price/ton: This multiple is driven by the demand and supply of the lithium price as well as the efficient operations of the plant. The computation of the selling price may be based on the output sold per long-term contract, which is expected to have a floor and a cap, as well as the spot price on the date of placing a purchase order by the customer, with the Company and the customer sharing the difference between the floor and spot price. |
| ● | Capex/ton: This reflects the Capex incurred on a per-ton basis. It includes both direct and indirect costs. It also has contingency costs built in for any impact on Capex, to account for unforeseen events. The key is to optimize plant efficiency in long-term operations with the appropriate technology and set-up. |
| ● | Opex/ton: This includes the ongoing expenses incurred from the day-to-day running of the operations. It helps in measuring how much profit a company makes on a dollar of sales after paying for variable costs of production, such as wages and raw materials, but before paying interest or tax. The lower multiple reflects the efficient functioning of the management. |
| ● | Capacity Utilization: This measures how much output a plant is producing, compared to its maximum potential output, which is dependent on two key factors: (a) design capacity, which impacts the operational efficiency of the plant, and (b) the plant’s downtime for its maintenance. Timely maintenance is also the key to running any efficient operations. |
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Further, since we are yet to generate revenue, non-GAAP measures such as EBITDA and EBITDA margins, cannot be captured currently, but will be stated once we have commenced commercial production and selling of battery grade lithium to our intended customers.
Business and Macroeconomic Conditions
Our business and financial condition has been, and we believe will continue to be, impacted by adverse and uncertain macroeconomic conditions and events, including higher inflation, higher interest rates, supply chain and logistics challenges, banking crises, and fluctuations or volatility in capital markets.
Components of Results of Operations
Revenue
We have not generated any revenue to date. We expect to generate a significant portion of our future revenue from the sale of battery grade lithium primarily to the EV market. We expect that we will enter into long-term contracts (typically 10 years), driven by industry dynamics of the EV industry, with a pricing structure at cap and ceiling, and sharing of variable price between customers and the Company.
Cost of Goods Sold
We have not sourced any raw material to date. We expect to source brine from lithium producing suppliers including the oil and gas industry as a byproduct of their exploration and extraction processes. We are in the process of negotiating with multiple suppliers for brine feedstock, including producers from the oil and gas industry. The length, tenure and pricing of these contracts will depend largely on the type of supply and is expected to vary from supplier to supplier.
Expenses
General and administrative
General and administrative expense consists of costs to maintain our daily operations and administer the business that are not directly attributable to generating revenue or cost of goods or raw material. These consist primarily of consulting services (including advisory services for organization setup and administrative related services from contractors, consultants), professional services such as accounting advisory, statutory auditor fees, technical consultants, and business consulting, as well as personnel related expenses (including stock based compensation), legal and book-keeping services, insurance expenses (including director and officer’s insurance), investor relations activities and marketing expenses. We expect our general and administrative expenses will increase in absolute dollars over time as we continue to invest in initially setting up our Facility, hire additional employees, and subsequently invest in the growth of our business and incur costs associated with being a publicly traded company with respect to compliance with the regulations of the SEC and the Nasdaq Capital Market.
Other Income (Expenses)
Interest income
Interest income is comprised of interest earned on promissory notes. During the year 2024, the Company issued promissory notes of $176,000 and $316,000 to IGX Minerals LLC and IG Lithium LLC respectively. These notes carry an interest rate of 6% with maturity date of February 28, 2025, and July 1, 2025, respectively. The Company is actively negotiating the terms for repayment of the promissory note issued and is evaluating multiple options including a possible strategic investment.
Interest expense
Interest expense is comprised of interest payable on the insurance funding loans and short-term loans.
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The Company entered into a financing agreement of $407,500 for the purchase of an insurance policy with AFCO Insurance Premium Finance in August 2025. The Company made a downpayment of $70,256, which was applied to the loan amount at the time of the loan agreement. The debt is payable in monthly instalments of $35,125 each for 10 months. Payments include a stated interest rate of 7.5% and are secured against a lien on the insurance policy.
The Company entered into a financing agreement of $510,000 for the purchase of a director and officer’s insurance policy with AFCO Insurance Premium Finance in 2024. The Company made a downpayment of $44,162, which was applied to the loan amount at the time of the loan agreement. The debt is payable in monthly instalments of $44,162 per month for 11 months. Payments include a stated interest rate of 8.46% and are secured against a lien on the insurance policy.
The Company issued a Term Sheet to Endurance in the aggregate principal amount of $1,750,000, bearing interest at a rate of 15% per year, and maturing in March 2025.
The Company issued Term Sheets to several lenders, providing for loans in the aggregate principal amount of $1,800,000, bearing interest at a rate of 15% per year, and maturing in March 2025.
Interest expense for the three months ended September 30, 2024 included interest on a Legacy Stardust Power financing agreement of $80,800 for the purchase of an insurance policy with First Insurance Funding. Payments include a stated interest rate of 8.25% and are secured against a lien on the insurance policy. The debt was fully paid off as of September 30, 2025.
Finance charges
Finance charges includes the change in fair value of the Company’s make-whole provision related to the Common Stock Purchase Agreement determined based on the closing price of the Company’s Common Stock, as reported on the Nasdaq Capital Market and the costs incurred on sale of common stock pursuant to the Common Stock Purchase Agreement.
Change in fair value of investment in equity securities
Change in fair value of investment in equity securities relates to movements in fair value of investment in equity securities of strategic investments such as the investment in QXR and IRIS Metals, that need to be recorded in the consolidated statements of operations for each reporting period, based on readily available quoted prices for such investment.
Change in fair value of SAFE notes and convertible notes
Change in fair value of SAFE notes and convertible notes relates to movements in fair value of SAFE notes and convertible notes that have been classified as liability instruments in the financial statements, which need to be recorded in the statement of operations for each reporting period, based on third party valuations carried out at period end. Upon consummation of the Business Combination on July 8, 2024, the SAFE notes and convertible notes were converted into Common Stock of the Company and hence the balance is $Nil in the unaudited condensed balance sheet as of September 30, 2025, and December 31, 2024.
Change in fair value of sponsor earnout shares
Change in fair value of sponsor earnout shares relates to movements in fair value of earnout shares issued to the Sponsor which have been classified as liability instruments in the financial statements, that need to be recorded in the unaudited condensed consolidated statement of operations for each reporting period, based on third party valuations carried out at period end.
Change in fair value of warrant liability
Change in fair value of warrant liability relates to movements in fair value of Public Warrants and Private Warrants which have been classified as liability instruments in the financial statements, that need to be recorded in the unaudited condensed consolidated statement of operations for each reporting period, based on fair value at period end.
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Provision for income taxes
We are constituted as a Delaware corporation and are subject to U.S. federal and state income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities and changes in tax law.
Loss on sale of investments in equity securities
Loss on sale of investment in equity securities relates to realized loss on sale of investment in equity securities of IRIS Metals. The sale was made in response to evolving market conditions and liquidity needs.
Loss on write off promissory notes and deposit
Loss on write off promissory notes and deposit relates to write-off of a promissory note and deposit made in connection with a previously contemplated strategic partnership with IGX and Usha Resources. The likelihood of entering into definitive agreements with them had diminished significantly during the quarter and based on an updated assessment these amounts were deemed uncollectible.
Results of Operations
The following table sets forth our unaudited condensed statements of operations information for the period indicated:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||
| September 30, 2025 | September 30, 2024 | Changes | September 30, 2025 | September 30, 2024 | Changes | |||||||||||||||||||
| Revenue | - | - | - | - | - | - | ||||||||||||||||||
| General and administrative expenses | 3,825,671 | 8,980,965 | (5,155,294 | ) | 12,610,666 | 11,483,389 | 1,127,277 | |||||||||||||||||
| Operating Loss | (3,825,671 | ) | (8,980,965 | ) | 5,155,294 | (12,610,666 | ) | (11,483,389 | ) | (1,127,277 | ) | |||||||||||||
| Other income (expenses) | - | |||||||||||||||||||||||
| Interest income | 4 | 3,397 | (3,393 | ) | 12,014 | 3,397 | 8,617 | |||||||||||||||||
| Interest expense | (11,290 | ) | (8,558 | ) | (2,732 | ) | (177,222 | ) | (10,637 | ) | (166,585 | ) | ||||||||||||
| Finance charge | (54,752 | ) | - | (54,752 | ) | (273,871 | ) | - | (273,871 | ) | ||||||||||||||
| Change in fair value of earnout shares | - | 1,636,100 | (1,636,100 | ) | 528,000 | 1,636,100 | (1,108,100 | ) | ||||||||||||||||
| Change in fair value of warrant liability | (511,109 | ) | (2,753,964 | ) | 2,242,855 | 1,660,583 | (2,753,964 | ) | 4,414,547 | |||||||||||||||
| Change in fair value of investment in equity securities | 27,680 | 11,678 | 16,002 | (700,454 | ) | (150,994 | ) | (549,460 | ) | |||||||||||||||
| Change in fair value of convertible equity | - | - | - | - | (471,400 | ) | 471,400 | |||||||||||||||||
| Change in fair value of SAFE notes | - | - | - | - | (955,000 | ) | 955,000 | |||||||||||||||||
| Loss on write off of promissory note and deposit | - | - | - | (232,481 | ) | - | (232,481 | ) | ||||||||||||||||
| Loss on sale of investment un equity securities | (84,626 | ) | - | (84,626 | ) | (179,805 | ) | - | (179,805 | ) | ||||||||||||||
| Total other expenses | (634,093 | ) | (1,111,347 | ) | 477,254 | 636,764 | (2,702,498 | ) | 3,339,262 | |||||||||||||||
| Net Loss | (4,459,764 | ) | (10,092,312 | ) | 5,632,548 | (11,973,902 | ) | (14,185,887 | ) | 2,211,985 | ||||||||||||||
Revenues
We have not earned any revenue since inception.
Cost of Goods Sold
We did not manufacture any products, and hence did not incur any direct costs related to production or carrying inventory, since inception.
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General and Administrative Expenses
General and administrative expenses primarily attributable to fees for professional and consulting fees, mainly comprising marketing advisory services and other consulting, legal services and advisory services with respect to the Company’s organization, fees for strategic investments evaluation and employee related compensation expenses representing base salary, benefits and stock based compensation expense. The details of these expenses are as follows:
| Three months ended | Nine months ended | |||||||||||||||||||||||
| September 30, 2025 | September 30, 2024 | Changes | September 30, 2025 | September 30, 2024 | Changes | |||||||||||||||||||
| Payroll and related taxes | 2,938,743 | 6,654,718 | (3,715,975 | ) | 9,702,403 | 7,727,767 | 1,974,636 | |||||||||||||||||
| Professional and consulting fees | 366,559 | 1,393,753 | (1,027,194 | ) | 704,116 | 2,238,744 | (1,534,628 | ) | ||||||||||||||||
| Legal fees | 222,953 | 384,270 | (161,317 | ) | 702,615 | 581,835 | 120,780 | |||||||||||||||||
| Insurance | 122,721 | 166,724 | (44,003 | ) | 414,177 | 220,713 | 193,464 | |||||||||||||||||
| Other | 174,695 | 381,500 | (206,805 | ) | 1,087,355 | 714,330 | 373,025 | |||||||||||||||||
| Total | 3,825,671 | 8,980,965 | (5,155,294 | ) | 12,610,666 | 11,483,389 | 1,127,277 | |||||||||||||||||
For the three months ended September 30, 2025, general and administrative expenses decreased compared to the three months ended September 30, 2024. The decrease was primarily attributable to lower employee-related costs, including a reduction in stock-based compensation expense. The prior year was higher due to catch up stock-based compensation expense recognized related to the consummation of the business combination. In addition, professional and consulting fees, as well as other administrative expenses, were lower in the current period compared to the prior year due to incremental costs incurred in connection with the business combination.
For the nine months ended September 30, 2025, general and administrative expenses increased compared to the nine months ended September 30, 2024. The increase was primarily driven by higher employee-related costs due to additional headcount, as well as increased legal, insurance, and other administrative expenses associated with the Company’s expanded operations. These increases were partially offset by lower professional and consulting fees, primarily reflecting a reduction in stock-based compensation expense for consultant due to forfeitures during the period.
Other Income (Expenses)
Interest income
For the three months ended September 30, 2025, interest income decreased by $3,393, compared to the prior year, primarily driven by interest earned on promissory notes issued during August 2024 which matured on July 1, 2025.
For the nine months ended September 30, 2025, interest income increased by $8,617, compared to prior year primarily attributable to interest earned in the current year for promissory notes issued during August 2024.
Interest expense
For the three and nine months ended September 30, 2025, interest expenses increased by $2,732 and $166,585 respectively, compared to the prior year. The increase was primarily due to interest expense incurred on the financing agreement related to directors and officers and other insurance policies and finance agreements for short-term loans with various lenders during December 2024.
Finance charges
For the three and nine months ended September 30, 2025, finance charges increased by $54,752 and $273,871, respectively, primarily due to the change in fair value of the Company’s make-whole provision related to the Common Stock Purchase Agreement. The Company did not have any such expense in the prior year.
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Change in fair value of investment in equity securities
For the three and nine months ended September 30, 2025, the fair value of investment in equity securities increased by $16,002 and decreased by $549,460, compared to the prior year, respectively, primarily due to fluctuations in the fair value of investments in QXR and IRIS Metals, based on readily available quoted market prices for these investments.
Change in fair value of SAFE notes
For the three and nine months ended September 30, 2025, the Company did not recognize any change in the fair value of SAFE notes, compared to a loss of $Nil and $955,000 for the comparable period in the prior year, respectively. The SAFE notes, which had previously been classified as liability instruments, were converted to equity following the consummation of the Business Combination with GPAC II on July 8, 2024. The Company had not issued any such SAFE notes post Business Combination consummation.
Change in fair value of convertible notes
For the three and nine months ended September 30, 2025, the Company did not recognize any change in the fair value of convertible notes, compared to a loss of $Nil and $471,400 for the comparable period in the prior year, respectively. The convertible notes, which had previously been classified as liability instruments, were converted to equity following the consummation of the Business Combination with GPAC II on July 8, 2024. The Company had not issued any such convertible notes post Business Combination consummation.
Change in fair value of earnout shares
For the three and nine months ended September 30, 2025, the fair value of earnout shares decreased by $1,636,100 and $1,108,100, compared to the prior year, respectively, primarily due to fluctuations in the fair value of earnout shares issued to the sponsor. The earnout shares have been classified as liability instruments in the financial statements, and the fair value adjustment is recorded in the unaudited condensed consolidated statement of operations for each reporting period, based on third party valuations carried out at period end.
Change in fair value of warrant liability
Change in fair value of warrant liability was an increase in income of $2,242,855 and $4,414,547 for the three and nine months ended September 30, 2025, respectively, compared to the prior year. This relates to movements in fair value of Public and Private Warrants which have been classified as liability instruments in the financial statements, that need to be recorded in the unaudited condensed consolidated statement of operations for each reporting period, based on fair value at period end.
Loss on sale of investments in equity securities
For the three and nine months ended September 30, 2025, the Company recorded a loss of $84,626 and $179,805 in connection with the sale of investment in equity securities. These securities were originally acquired as part of a broader investment strategy but were sold during the quarter in response to evolving market conditions and liquidity needs. The loss reflects the decline in market value relative to the carrying amount at the time of sale. The Company had not sold any investment in equity securities in the prior year.
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Loss on write off promissory notes and deposit
For the three and nine months ended September 30, 2025, the Company recorded a loss of $Nil and $232,481 related to the write-off of a promissory note and deposit associated with a previously contemplated strategic partnership with IGX and Usha Resources. The arrangement was terminated during the period, and based on an updated assessment these amounts were deemed uncollectible. Accordingly, the full balance was written off and recognized as a non-operating loss. No such write off was noted in the prior year.
Tax expenses
For the three and nine months ended September 30, 2025, and 2024 the tax expense is $Nil, due to net losses incurred during these periods. We do not carry any deferred tax assets on the balance sheet as at September 30, 2025 and December 31, 2024, primarily due to net operating loss carry forwards resulting from historically incurred net operating losses and full valuations allowance of those losses, as our ability to realize future tax benefits related to these assets is largely dependent upon operational profitability, which is uncertain. As a result of this uncertainty, we have established a full valuation allowance, and have not recognized a net provision or benefit for income taxes in the periods reported.
Net loss
For the three and nine months ended September 30, 2025, the Company incurred a net loss of $4,459,764 and $11,973,902 respectively and for the three and nine months ended September 30, 2024, the Company incurred a net loss of $10,092,312 and $14,185,887 respectively. Since the Company is yet to start commercial production of battery grade lithium, the operating expenses are expected to increase, as the Company starts to recruit more personnel to perform general operational tasks and set up the Facility and execute supply agreements.
Liquidity and Capital Resources
Overview
We have devoted substantial efforts and financial resources to raising capital and organizing and staffing the Company, and as a result, have incurred significant operating losses. As of September 30, 2025, and December 31, 2024, we had an accumulated deficit of $ 64,592,850 and $52,618,948 respectively.
We have not earned any revenue and have been operating at a loss since inception. We have an accumulated deficit and stockholders’ deficit.
Liquidity Requirements
Our primary requirements for liquidity and capital are investment in new facilities, new technologies, working capital and general corporate needs. Specifically, in this regard, the refinery cost, which includes all direct and indirect costs and contingencies needed to build phase 1 of the refinery (25,000 metric tons per annum of battery grade lithium carbonate), has been estimated at approximately $500 million following completion of the FEL-3 study. We intend to finance our project cost through a mix of debt, equity and potential government grants. We expect our operational expenditures to increase for the foreseeable future in connection with ongoing and future activities. Specifically, expenditures will increase as we:
| ● | Secure and build facilities; | |
| ● | invest in research and development activities to advance the development of our technologies; and | |
| ● | incur additional expenses associated with transitioning to, and operating as, a public company. |
Our current and ongoing liquidity requirements will depend on many factors, including: our launch cadence, the timing and extent of spending to support additional development efforts, the introduction of new and enhanced offerings, the continuing market adoption of our offerings, the timing and extent of additional capital expenditures to build and invest in the Facility. In addition, we may, in the future, enter into arrangements to acquire or invest in complementary businesses, business offerings and technologies. However, we do not have agreements or commitments to enter into any such acquisitions or investments at this time.
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Sources of Liquidity and Going Concern
We have funded our operations with proceeds from sales of Legacy Stardust Power Common Stock, promissory notes, SAFE notes, debt financing, equity financing and convertible equity agreements. To continue as a going concern, we anticipate funding our near-term operations through the sale of equity securities, promissory notes, debt financing or from other capital sources. If adequate funds are not available, we may be required to curtail, delay, or eliminate some or all of our planned activities, or raise additional financing to continue to fund operations, and may not be able to continue as a going concern.
Our unaudited condensed consolidated financial statements have been presented on the basis that the Company is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company is a development stage entity having no revenues, has incurred net loss since inception of $ 64,592,850 and has stockholders’ deficit of $5,120,114 as at September 30, 2025. The Company expects to continue to incur significant costs in pursuit of its operating and investment plans. These costs exceed the Company’s existing cash balance and net working capital.
As discussed above:
| ● | On October 7, 2024, the Company entered into a Common Stock Purchase Agreement (the “Purchase Agreement”) and a related Registration Rights Agreement (the “Registration Rights Agreement”) with B. Riley Principal Capital II, LLC (“B. Riley Principal Capital II”) to sell up to $50,000,000 of newly issued shares of the Company’s Common Stock to B. Riley Principal Capital II. During the nine months ended September 30, 2025, the Company issued 505,271 shares of common stock pursuant to the Purchase Agreement, aggregating to net proceeds of $1,598,008. Subsequent to the quarter end, the Company issued 132,777 shares of Common Stock aggregating to net proceeds of $471,677. | |
| ● | On January 27, 2025, the Company consummated a public offering of 479,200 shares of Common Stock and accompanying warrants to purchase up to 479,200 shares of Common Stock at a public offering price of $12.00 per share and warrant with an exercise price of $13.00, generating aggregate gross proceeds of approximately $5,750,400 before offering expenses. | |
| ● | On March 16, 2025, the Company entered into a letter agreement (the “Inducement Letter”) with a warrant holder (the “Exercising Holder”) providing for the immediate cash exercise of outstanding warrants to purchase 479,200 shares of the Company’s Common Stock at a reduced exercise price of $6.20 per share, generating aggregate gross proceeds of approximately $2,971,040, before related expenses, on March 18, 2025. In connection with such exercise, the Company agreed to issue new Common Stock purchase warrants (the “Inducement Warrants”) to purchase up to 958,400 shares of common stock at an exercise price of $7.00 per share. | |
| ● | On June 18, 2025, the Company consummated a public offering of 2,150,000 shares of Common Stock at a public offering price of $2.00 per share, generating aggregate gross proceeds of approximately $4,300,000 before offering expenses. On June 25, 2025, the Company consummated the partial exercise of over allotment of the public offering, of 110,000 shares of Common Stock at a public offering price of $2.00 per share, generating additional aggregate gross proceeds of approximately $220,000 before offering expenses. |
We believe that the cash on hand, and additional investments available through issuance of new Common Stock, will be inadequate to satisfy the Company’s working capital and capital expenditure requirements for at least the next twelve months. The ability of the Company to continue as a going concern is dependent upon management’s plan to raise additional capital from the issuance of equity or receive additional borrowings to fund the Company’s operating and investing activities over the next year. The accompanying unaudited condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to us. Even if we are able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing. Failure to secure adequate financing could have a material adverse effect on the business, operations and financial performance of the Company.
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Insurance funding borrowing
On November 19, 2023, Legacy Stardust Power borrowed $80,800 from First Insurance Funding to finance its insurance policies. The total of premium, taxes and fees aggregated to $101,000, of which an initial down payment of $20,200 was paid by Stardust Power, and the balance financed through First Insurance Funding. The loan has an annual percentage rate of 8.25% and is payable in 10 instalments through September 21, 2024. As at December 31, 2024 and September 30, 2025, the loan was fully repaid.
On July 18, 2024, the Company entered into a financing agreement of $510,000 for the purchase of an insurance policy with AFCO Insurance Premium Finance. The Company made a downpayment of $44,162, which was applied to the loan amount at the time of the loan agreement. The debt is payable in monthly instalments of $44,162 per month for 11 months. Payments include a stated interest rate of 8.46% and are secured against a lien on the insurance policy. As at September 30, 2025, the loan was fully repaid.
On August 5, 2025, the Company entered into a financing agreement of $407,500 with AFCO Insurance Premium Finance to fund the purchase of an insurance policy. The Company made a down payment of $70,256 at the inception of the agreement, and the remaining balance was financed through AFCO. The loan is payable in 10 monthly instalments of $35,125 each, beginning on September 8, 2025, and includes interest at a stated annual rate of 7.5%. The loan is secured by a lien on the related insurance policy. As of September 30, 2025, the carrying amount was $304,666.
SAFE notes
On February 23, 2024, Legacy Stardust Power signed the February 2024 SAFE note for an amount of $200,000. In accordance with the terms of the February 2024 SAFE note, the SAFE notes converted into shares of Legacy Stardust Power Common Stock, immediately prior to the First Effective Time on similar terms to the other SAFE notes.
The SAFE notes are classified as liabilities based on evaluating characteristics of the instruments and are presented at fair value as non-current liabilities in the Company’s unaudited condensed consolidated balance sheet.
The SAFE notes provided Legacy Stardust Power an option to call for additional preferred stock up to 25,000,000 based on the contingent event of SAFE note conversion and notice issued by the Stardust Power board of directors (the “Board”), and achievement of certain milestones, for up to 42 months following such conversion. This feature was determined to be an embedded feature and is valued as part of the liability value associated with the instrument as a whole. Additionally, the SAFE notes provided the investor certain rights upon an equity financing, change in control or dissolution as described in Note 4 of the unaudited condensed consolidated financial statements of the Company. The estimated fair value of the SAFE notes considered the timing of issuance and whether there were changes in the various scenarios since issuance. As of December 31, 2023, the fair value of the SAFE notes was $5,212,200 and were classified as a non-current liability. The SAFE notes had no interest rate or maturity date, description of dividend and participation rights. The liquidation preference of the SAFE notes was junior to other outstanding indebtedness and creditor claims, on par with payments for other SAFE notes and/or preferred equity, and senior to payments for other equity of the Company that were not SAFE notes and/or pari preferred equity.
On March 21, 2024, Legacy Stardust Power entered into a financing commitment and equity line of credit agreement with AIGD. The agreement replaced the above contingent commitment feature of the SAFE notes with granting Legacy Stardust Power an option to drawdown up an additional $15,000,000 on terms similar to existing SAFE notes prior to the First Effective Time. On April 24, 2024, Legacy Stardust Power amended and restated the August 2023 SAFE note and the November 2023 SAFE note. On May 1, 2024, Legacy Stardust Power amended and restated the February 2024 SAFE note. These amendments clarified the conversion mechanism in connection with the Business Combination. In accordance with the terms of the convertible equity agreements, immediately prior to the First Effective Time, the cash received pursuant to the SAFE note agreements automatically converted into 63,692 shares of Combined Company Common Stock.
Short-term loans
In December 2024, the Company entered into a binding Term Sheet (“Term Sheet”) with Endurance Antarctica Partners II, LLC (“Endurance”), a related party, providing for a loan (the “Loan”) in the aggregate principal amount of $1,750,000, bearing interest at a rate of 15% per year, and maturing in March 2025 (the “Maturity Date”). The Term Sheet contained customary representations and warranties and customary events of default. Pursuant to the Term Sheet, 550,000 shares of Company’s Common Stock, owned by Roshan Pujari, Chief Executive Officer of the Company, were pledged as collateral. In addition, the Company has agreed to issue to Endurance $3,500,000 in Common Stock as an Equity Kicker, with the price of each share being determined based on terms per the earlier to occur of (i) the consummation of a private placement offering of Company securities (in which case such issuance shall be on no less favorable terms than the terms of such private placement) and (ii) the Maturity/ Repayment Date, provided that the minimum number of shares of Common Stock shall be no less than 50,000 shares. In addition, Endurance will receive warrants representing the right, exercisable within five years of the closing date, of up to 50% of Common Stock issued as Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00 in accordance with the Private Placement terms. During the nine months ended September 30, 2025, the Company has fully repaid the principal amount, the accrued interest and issued the equity shares and warrants to Endurance.
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In December 2024, the Company entered into binding Term Sheets (“Term Sheets”) with several lenders including DRE Chicago, LLC, a related party (collectively, the “Lenders”), providing for loans (the “Loans”) in the aggregate principal amount of $1,800,000, bearing interest at a rate of 15% per year, and maturing in March 2025 (the “Maturity Date”). The proceeds of the Loans are expected to be used by the Company for general corporate and working capital purposes. The Term Sheets contained customary representations and warranties and customary events of default. Pursuant to the Term Sheets, an aggregate of approximately 340,000 shares of Company’s Common Stock, owned by Roshan Pujari, Chief Executive Officer of the Company, were pledged as collateral. In addition, the Company has agreed to issue to the Lenders an aggregate of $2,700,000 in Common Stock as an Equity Kicker, with the price of each share being determined based on terms per the earlier to occur of (i) the consummation of a private placement offering of Company securities (in which case such issuance shall be on no less favorable terms than the terms of such private placement) and (ii) the Maturity/ Repayment Date, provided that the minimum number of shares of Common Stock issued to the Lenders shall be no less than an aggregate of 36,000 shares. In addition, the Lenders will receive warrants representing the right, exercisable within five years of the closing date, of up to 50% of Common Stock issued as Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00 in accordance with the Private Placement terms. During the nine months ended September 30, 2025, the Company has fully repaid the principal amount, the accrued interest and issued the equity shares and warrants to the Lenders.
Cash Flow
Summary
The following table summarizes our cash flows for the periods presented:
Nine months ended September 30, 2025 | Nine months ended September 30, 2024 | Change | ||||||||||
| Net cash used in operating activities | (6,548,760 | ) | (8,514,161 | ) | 1,965,401 | |||||||
| Net cash used in investing activities | (3,001,632 | ) | (1,279,257 | ) | (1,722,375 | ) | ||||||
| Net cash provided by financing activities | 10,222,822 | 10,108,680 | 114,142 | |||||||||
| Net change in cash | 672,430 | 315,262 | 357,168 | |||||||||
Cash Flows Used in Operating Activities
For the nine months ended September 30, 2025, net cash used in operating activities was $6,548,760 consisting of a $11,973,902 net loss, adjusted for $5,247,665 of non-cash charges, primarily comprising stock based compensation expense, change in fair value of investments, warrant liability, sponsor earnout shares and common stock make-whole obligation, loss on sale of investments, loss on write off of deferred transaction costs, promissory note and deposits and depreciation, and a $177,477 net increase in operating assets and liabilities, primarily driven by an increase of $231,370 in accounts payable and other current liabilities which represent the various costs that are expected to be incurred as we set up operations during this period, partially offset by a decrease of $53,893 in prepaid expenses and other assets due to amortization,
For the nine months ended September 30, 2024, net cash used in operating activities was $8,514,161 consisting of a $14,185,887 net loss, adjusted for $9,730,411 non-cash charge for change in fair value of SAFE notes, change in fair value of investments, convertible notes, sponsor earnout shares, investments and stock based compensation and a $4,058,685 net change in operating assets and liabilities, primarily driven by an decrease of $3,597,110 in accounts payable and other current liabilities which primarily represent the various costs that are expected to be incurred as we set up operations during this period, partially offset by a decrease of $461,575 in prepaid expenses.
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Cash Flows Used in Investing Activities
For the nine months ended September 30, 2025, net cash used in investing activities was $3,001,632, primarily representing $3,555,268 incurred for capital project costs related to construction of the refinery offset partially by $570,255 in proceeds from sale of investments in equity securities.
For the nine months ended September 30, 2024, net cash used in investing activities was $1,279,257, primarily representing $726,102 on account of pre-acquisition capital project costs related to construction of the refinery purchase of computer and equipment of $11,155, promissory notes issued of $492,000 and $50,000 of investments in other long term assets.
Cash Flows from Financing Activities
For the nine months ended September 30, 2025, net cash provided by financing activities was $10,222,822 related primarily to gross proceeds from consummation of public offerings of $10,270,400, gross proceeds from a warrant inducement transaction of $2,971,040, proceeds from PIPE investors of $125,000, proceeds from short term loan of $337,244 and common stock issuance proceeds of $1,647,431 partially offset by repayment of short-term loans of $3,841,129, payment of transaction costs associated with public offering and warrant inducement of $1,260,226.
For the nine months ended September 30, 2024, net cash provided by financing activities was $10,108,680 related primarily to cash received from proceeds for issuance of convertible notes of $2,100,000, SAFE notes of $200,000, exercise of warrants of $1,561,655, proceeds from a short-term loan of $510,000 and proceeds from closing of the Business Combination including issuance of PIPE shares of $11,639,088, offset partially by deferred Business Combination transaction costs of $4,134,056, repayment of short term loans of $199,170 and repayment of notes payable to related parties of $1,562,834.
Operating and Capital Expenditure Requirements
The Company has not earned any revenue and has been operating at a loss since inception. The Company has an accumulated deficit and stockholders’ deficit. These conditions raise substantial doubt about its ability to continue to finance operations over the next twelve months and is dependent upon management’s plan to raise additional capital from issuance of equity or receive additional borrowings to fund the Company’s operating and investing activities over the next one year. Our intended capital requirements depend on many factors including the capital expenditures required to set up our Facility, and undertake all activities necessary to start commercial production, prices of capital equipment, and preliminary costs. In the future, it will depend on our expansion of acquiring new assets/sites to have access and potential ownership of raw material. We may in the future enter into arrangements to acquire or invest in complementary businesses, services and technologies, including intellectual property rights. We may be required to seek additional equity or debt financing. If additional financing is required from outside sources, over and above what we are intending to raise currently, we may not be able to raise it on acceptable terms or at all. If we are unable to raise additional capital when desired, our business, results of operations and financial condition would be materially and adversely affected and may not be able to continue our intended operations as a going concern.
Commitments and Contractual Obligations
We have entered into an engineering agreement with Primero USA, Inc. for $4,724,690 to provide a FEL-3 report. See Note 3 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report for additional details regarding other contractual obligations and commitments. While the Company has not entered into any other binding commitments, other strategic partnerships are being evaluated which could lead to future contractual obligations.
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Summary of Critical Accounting Estimates
We believe that the following accounting policies and estimates involve a high degree of judgment and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our unaudited condensed consolidated financial condition and results of our operations. See Note 2 to our unaudited condensed consolidated financial statements appearing elsewhere in this Quarterly Report for a description of our other significant accounting policies. The preparation of our unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the amounts reported in those financial statements and accompanying notes. Although we believe that the estimates we use are reasonable, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods could differ from those estimates.
Income Taxes
Income taxes are recorded in accordance with ASC 740, “Income Taxes” (“ASC 740”), which provides for deferred taxes using an asset and liability approach. We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. We account for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, we recognize the tax benefit of tax positions to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. We recognize any interest and penalties accrued related to unrecognized tax benefits as income tax expense.
Earnout Share Liability, SAFE Notes, and Convertible Notes
We account for the earnout share liability, SAFE notes, and convertible notes in accordance with the guidance in ASC 480, “Distinguishing Liabilities from Equity” and ASC 815-40, “Derivatives and Hedging,” whereby it is accounted for as a liability which requires initial and subsequent measurements at fair value. This liability is subject to re-measurement at each balance sheet date until a triggering event, equity financing, change in control or dissolution occurs, and any change in fair value is recognized in the Company’s unaudited condensed consolidated statements of operations. The fair value estimate includes significant inputs not observable in market, which represents a Level 3 measurement within the fair value hierarchy. The valuation uses probabilities considering pay-offs under various scenarios as follows: (i) an equity financing where the SAFE notes and convertible note will convert into certain preferred stock; (ii) a change in control where the SAFE note and convertible note holders will have an option to receive a portion of the cash and other assets equal to the purchase amount; (iii) a dissolution event where the SAFE notes and convertible note holders will be entitled to the purchase amount subject to liquidation priority and (iv) achievement of Combined Company Common Stock price targets, where the earnout share liability will convert into certain number of shares of Common Stock. The value of the instrument is likely to vary significantly based on the probability of each of the conversion scenarios that occurs, and management will reassess such probability at each reporting period. These probabilities will ultimately be factored into the valuation of the instrument and will require third party valuation experts to assist in the determination of this value. The changes in value of the instrument could impact the unaudited condensed consolidated financial statements materially and therefore constitute a critical estimate.
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Fair Value of Common Stock
Due to the absence of an active market for our Common Stock prior to consummation of the business combination, and in accordance with the American Institute of Certified Public Accounting and Valuation Guide, Valuation of Privately-Held Company Equity Securities Issued as Compensation, the fair value of our Common Stock was previously estimated based on valuation carried out by third party appraisers and approved by our Board based on current available information and after exercising reasonable judgment. This estimate requires significant judgment and considers several factors, including:
| ● | independent third-party valuations of our Common Stock; | |
| ● | estimated probabilities of future liquidation scenarios; | |
| ● | projected future cash flows provided by management; | |
| ● | guideline public company information; | |
| ● | discount rates; | |
| ● | our actual operating and financial performance; | |
| ● | current business conditions and projections; | |
| ● | our stage of development; | |
| ● | U.S. and global capital markets conditions; and | |
| ● | expected volatility based on comparable public company stock performance over the time period being measured. |
Probability weightings assigned to potential liquidity scenarios were based on management’s expected near-term and long-term funding requirements and assessment of the most attractive liquidation possibilities at the time of the valuation. In the most heavily weighted scenarios, the enterprise valuation was calculated using a valuation approach based on a combination of the guideline public company approach, an income approach analysis with an option pricing model and a cost approach, to determine the amount of aggregate equity value allocated to our Common Stock.
In all scenarios, a discount for lack of marketability (“DLOM”) was applied to arrive at a fair value of common shares. A DLOM accounts for the lack of marketability of shares that are not publicly traded.
Application of these approaches and methodologies involves the use of estimates, judgment and assumptions that are complex and subjective, such as those regarding our expected future revenue, expenses, operations and cash flows, discount rates, industry and economic outlook, and the probability of and timing associated with potential future events. Changes in any or all estimates and assumptions or the relationships between those assumptions impact our valuations as of each relevant valuation date and may have a material impact on the valuation of our Common Stock. Estimates of the fair value of the Common Stock are used in the measurement of stock based compensation. Following the Business Combination, it is no longer necessary to determine the fair value of our business as the Stardust Power Common Stock is now publicly traded.
Recent Accounting Pronouncements
See Note 2 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report for additional details regarding recent accounting pronouncements.
Segment Reporting
The Company reports segment information in the same way management internally organizes the business in assessing performance and making decisions regarding allocation of resources in accordance with ASC Topic 280, “Segment Reporting.” The Company has a single reportable operating segment which operates as a single business platform. In reaching this conclusion, management considered the definition of the Chief Operating Decision Maker (“CODM”), how the business is defined by the CODM, the nature of the information provided to the CODM, how the CODM uses such information to make operating decisions, and how resources and performance are accessed. The Company’s CODM is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company has a single, common management team and our cash flows are reported and reviewed with no distinct cash flows.
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Related Party Transactions
On September 18, 2024, the Company entered into a consulting agreement in the amount of $500,000 with DRE Chicago LLC, whose principal is Paramita Das. Ms. Das was onboarded as the Chief Strategy Officer and Senior Advisor to CEO of the Company. Additionally, as discussed above, in December 2024, the Company entered into a binding term sheet with DRE Chicago LLC and other lenders, providing for loan in the principal amount of $250,000 to DRE Chicago, bearing interest at a rate of 15% per year, and maturing in March 2025 (the “Maturity Date”). In addition, the Company has agreed to issue to DRE Chicago an aggregate of $375,000 in Common Stock as an Equity Kicker. In addition, DRE Chicago will receive warrants representing the right, exercisable within five years of the closing date, of up to 50% of Common Stock issued as Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00 in accordance with the Private Placement terms. During the nine months ended September 30, 2025, the Company has fully repaid the principal amount, the accrued interest and issued the equity shares and warrants to DRE Chicago.
As discussed above, in December 2024, the Company entered into a binding term sheet with Endurance Antarctica Partners II, LLC (“Endurance”), an affiliate of a director at the time and a shareholder, providing for a loan (the “Loan”) in the aggregate principal amount of $1,750,000, bearing interest at a rate of 15% per year, and maturing on March 2025 (the “Maturity Date”). In addition, the Company has agreed to issue to Endurance $3,500,000 in Common Stock as an Equity Kicker. In addition, Endurance will receive warrants representing the right, exercisable within five years of the closing date, of up to 50% of Common Stock issued as Equity Kicker, with each 10 warrants exercisable for one share of Common Stock at an exercise price of $115.00 in accordance with the Private Placement terms. During the nine months ended September 30, 2025, the Company has fully repaid the principal amount, the accrued interest and issued the equity shares and warrants to Endurance.
In March 2023, the Company entered into unsecured notes payable with three related parties. These notes payable provided the Company the ability to draw up to $1,000,000, in aggregate: $160,000 until December 31, 2023, and $840,000 until December 31, 2025. These loan facilities accrue interest, compounding semi-annually, at the long-term semiannual Applicable Federal Rate, as established by the Internal Revenue Service, which effectively was 4.71% as of September 30, 2025. In June 2025, the Company drew $250,000 from Energy Transition Investors LLC, and repaid the amount in full during the same month. The Company has accrued interest of $422 during the nine months ended September 30, 2025 on the drawn amount. As at September 30, 2025, the Company had $840,000 available to draw.
Private Warrants
The Sponsor purchased from GPAC II an aggregate of 5,566,667 warrants at a price of $1.50 per warrant in a private placement that occurred simultaneously with the completion of the Company’s initial public offering (the “Private Warrants”). At closing of the Business Combination, Stardust Power acquired the net liabilities for GPAC II including the Private Warrants. Each 10 Private Warrants entitle the holder to purchase one share of Common Stock at an exercise price of $115.00 per share. At September 30, 2025 there were 5,566,667 Private Warrants outstanding. As at September 30, 2025, the fair value of Private Warrants amounted to $421,953. The Company valued its Private Warrants based on the closing price of the Public Warrants since they are similar instruments.
Sponsor Earnout Shares
As part of the closing of the Business Combination, the Company issued 100,000 shares to the Sponsor. These shares are subject to vesting (or forfeiture) based on achieving certain trading price thresholds following the closing (“Sponsor Earnout Shares”). Fifty percent of the Sponsor Earnout Shares will vest when the VWAP of the Combined Company Common Stock price equals or exceeds $120.00 per share for a period of 20 trading days in a 30 trading day period, and the remaining fifty percent of the Sponsor Earnout Shares will vest when the VWAP of the Combined Company Common Stock price equals or exceeds $140.00 per share for a period of 20 trading days in a 30 trading day period. Upon the occurrence of a change in control, any remaining unvested Sponsor Earnout Shares become vested. Unvested Sponsor Earnout Shares will be forfeited if vesting does not occur prior to the eighth anniversary of the Closing Date. The Company assesses the fair value of expected earnout consideration at each reporting period using the Monte Carlo Method, which is consistent with the initial measurement of the expected earnout consideration. As at September 30, 2025, the fair value of Sponsor Earnout Shares amounted to $4,700.
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Recent Events
See Note 16 to our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report for additional details regarding subsequent events.
Stardust Power’s Risk Management Framework
Commodity Price Risk
Global commodity prices, especially for lithium hydroxide and, or lithium carbonate and other “battery metals” changes may impact the margins and produce less revenue or losses for the Company. Global lithium commodities market are still somewhat nascent and as the global supply chain changes this could impact the prices of commodities. The costs of lithium inputs could be affected as well further impacting margins and profitability. In order to address this risk, the Company is negotiating fixed price off take agreement with suppliers of raw material required. Also, we seek to enter into long-term partnerships to limit potential volatility in pricing. Additionally, in the future, we intend to enter into strategic partnerships that would create long-term alignment with buyers.
While there has been significant recent softness and reduced demand in respect of EVs and a significant decrease in the price of lithium, we believe that the long-term prospects for both remain positive.
Global Demand and Product Pricing Risk
New supplies of lithium and the emergence of new refiners both here in the United States and globally, could impact the global supply chain and product prices. Existing companies may be seeking to increase their capacity to provide lithium products and new companies seek to bring capacity online further increasing supply. Other companies may seek to enter the market. Also, the demand for lithium may be impacted by emerging technologies and other battery chemistries that may decrease the reliance on lithium and could result in reducing product prices. In order to address fluctuations in product price, and in lines with industry norms, the Company is intending to enter into 10-year long-term sales contracts with EV manufacturers, whereby we expect to have a cap and floor pricing strategy, and both, customer and the Company, sharing the difference between actual price and cap or floor pricing. We may further limit chemistry risk by refining to lithium carbonate prior to potentially refining to lithium hydroxide so we can meet market demands for either product. We stay informed on current trends in battery chemistry to project market demand.
Insurance Risk
The nature of these risks is such that liabilities could exceed any applicable insurance policy limits or could be excluded from coverage. There are also risks against which we cannot insure or against which we may elect not to insure. The potential costs, which could be associated with any liabilities not covered by insurance or in excess of insurance coverage, or compliance with applicable laws and regulations may cause substantial delays and require significant capital outlays, adversely affecting our future earnings and competitive position and potentially our financial viability. We may limit insurance risk by being proactive in our policies for environmental impact and climate change impact. Through strict adherence to Company protocols we may limit certain types of risk. Also, we intend to work only with best-in-class providers, who are adept at assessing various risks in our line of business adequately.
Strategic Risk
Strategic risk represents the risk associated with executive management failing to develop and execute on the appropriate strategic vision which demonstrates a commitment to our culture, leverages our core competencies, appropriately responds to external factors in the marketplace, and is in the best interests of our clients, employees, and members. By working with best-in-class partners and consultants who are industry experts, as well as by leveraging the knowledge of our senior executive team, we expect to be able to limit or address strategic risk and execution risk.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market Risk Framework
Market risk represents the risk of losses, or financial volatility, that may result from the change in value of our products due to fluctuations in its market price. The scope of our market risk management policies and procedures includes all market-sensitive data related to input and selling prices. We expect to be able to limit this risk by using third parties to finance acquisition of feedstock and logistics, as required. We may enter into long-term arrangements for supply to limit impacts of market risk.
The Company’s different types of market risk include:
Interest rate risk
Interest rate risk represents the potential volatility from changes in market interest rates. We are exposed to interest rate risk arising from changes in the level and volatility of interest rates, changes in the slope of the yield curve, changes in credit spreads, and the rate of prepayments on our interest-earning assets (e.g., inventories) and our funding sources (e.g., short-term financing) which finance these assets. Project finance and loan facilities are a key component of our financing strategy. Volatility in the interest rate market could impede our plans for growth.
Liquidity risk
Liquidity risk is the risk that we are unable to timely access necessary funding sources in order to operate our business, as well as the risk that we are unable to timely divest securities that we hold in connection with our sales and trading activities. The Company has been successful in equity financing in the past but there is no assurance that it will continue to be able to finance the Company with equity financing. The Company does not have substantial credit lines for financing the Company.
Credit risk
Credit risk refers to the potential for loss due to the default or deterioration in credit quality of a counterparty, customer, borrower, or issuer. The nature and amount of credit risk depends on the type of transaction, the structure and duration of that transaction and the parties involved. Credit risk also results from an obligor’s failure to meet the terms of any contract with us or otherwise fail to perform as agreed. This may be reflected through issues such as settlement obligations or payment collections.
Operational risk
The success of our plan requires us to be able to operationally deliver on the project plan and timelines as projected by management. In order to mitigate and control operational risk, we will develop policies and procedures that are designed to identify and manage operational risk at appropriate levels throughout the organization. We will also have business continuity plans in place that we believe will cover critical processes on a company-wide basis, and redundancies are built into our systems as we deem appropriate. These control mechanisms will be designed to ensure that operational policies and procedures are being followed and that our various businesses are operating within established corporate policies and limits. We are leveraging and intend to continue implementing established best practices for our industry to reduce operational risk.
Human Capital Risk
The success of our business is dependent upon the skills, expertise, industry knowledge and performance of our employees. Human capital risks represent the risks posed if we fail to attract and retain qualified individuals, particularly those having specialized technical knowledge in the exploration, extraction, and purification of brine from varying sources to produce battery-grade lithium, and employees who are motivated to serve the best interests of our clients, thereby serving the best interests of our Company. Attracting and retaining employees depends, among other things, on our Company’s culture, management, work environment, geographic locations and compensation. There are risks associated with the proper recruitment, development and rewards of our employees to ensure quality performance and retention. We offer competitive compensation and benefits to retain human capital, intend to offer educational opportunities to allow advancement, and promote balance in work life conditions by offering hybrid work-from-home options.
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Legal and regulatory risk
Legal and regulatory risk includes the risk of non-compliance with applicable legal and regulatory requirements and loss to our reputation we may suffer as a result of failure to comply with laws, regulations, rules, related self-regulatory organization standards and codes of conduct applicable to our business activities. We are generally subject to extensive regulation in the various jurisdictions in which we conduct our business. We are in the process of setting up procedures that are designed to ensure compliance with applicable statutory and regulatory requirements, such as public company reporting obligations, regulatory net capital requirements, sales practices, potential conflicts of interest, anti-money laundering, privacy and recordkeeping. We will also establish procedures that are designed to require that our policies relating to ethics and business conduct are followed.
Market Risk Exposure
Interest Rate Risk
As of September 30, 2025, the Company did not have any significant risk for changes in interest rates.
Credit Risk
We are subject to credit risk with respect to our cash balances for those amounts in excess of the FDIC insured amount of $250,000. The Company has only one financial banking institution.
Inflation Risk
We do not believe that inflation has had a material effect on our business, financial condition, or results of operations, other than its impact on the general economy. However, we are currently operating in a more volatile inflationary environment due to macroeconomic conditions and have limited data and experience doing so in our history, particularly as we continue to invest in growth in our business. The principal inflationary factor affecting our business is higher costs. Our inability or failure to address challenges relating to inflation could harm our business, financial condition, and results of operations.
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ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We are required to comply with the internal control requirements of the Sarbanes-Oxley Act for the period ending December 31, 2021 and thereafter. Only in the event that we are deemed to be a large accelerated filer or an accelerated filer and no longer qualify as an emerging growth company would we be required to comply with the independent registered public accounting firm attestation requirement on internal control over financial reporting. Further, for as long as we remain an emerging growth company as defined in the JOBS Act, we intend to 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 requirement.
Disclosure controls are procedures with the objective of ensuring that information required to be disclosed in our reports under the Exchange Act, such as this report, is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms. Disclosure controls are designed with the objective of ensuring that information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2025. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective. Accordingly, management believes that the financial statements included in this Quarterly Report on Form 10-Q present fairly in all material respects our financial position, results of operations and cash flows for the period presented.
Background and Remediation of Material Weaknesses
During the period from March 16, 2023 (inception) to December 31, 2023, the Company’s management identified material weaknesses in the implementation of the COSO 13 Framework (which establishes an effective control environment), lack of segregation of duties and management oversight, and control surrounding maintenance of adequate repository of contracts, appropriate classifications of expenses and complex financial instruments. We designed and implemented measures to improve our controls over financial reporting process and remediated these material weaknesses. Our ability to comply with the annual internal control report requirements will depend on the effectiveness of our financial reporting controls across our Company. We expect these systems and controls to involve significant expenditures and may become more complex as our business grows. To effectively manage this complexity, we will need to continue to improve our operational, financial and management controls, and our reporting systems and procedures. For more information, please refer to “Risk Factors - We identified material weaknesses in our internal control over financial reporting. If we are unable to remediate these material weaknesses, or if we experience additional material weaknesses or other deficiencies in the future, or otherwise fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately or timely report our financial results, which could result in loss of investor confidence and adversely impact our stock price” in our Annual Report on Form 10-K filed with SEC on March 27, 2025.
Changes in Internal Control over Financial Reporting
Other than the material weakness remediation efforts undertaken during 2024, there were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
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PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We are subject to certain routine legal and regulatory proceedings, as well as demands and claims that arise in the normal course of our business. The ultimate outcome of any litigation is often uncertain and unfavorable outcomes could have a negative impact on our results of operations and financial condition. We make a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter.
On July 7, 2025, a complaint was filed in the Supreme Court of the State of New York, County of New York, captioned H.C. Wainwright & Co., LLC v. Stardust Power, Inc., Case No: 654037/2025. The complaint names the Company as defendant, alleging, among other things, that the Company breached an engagement agreement with the plaintiffs. The plaintiffs seek, among other things, payment of all purported unpaid sums due under such engagement agreement. On September 19, 2025, the Company filed its answer in response to the complaint, in which it denied all liability and asserted several affirmative defenses. The Company plans to vigorously defend against the lawsuit and the action will proceed next to the discovery stage and for further proceedings.
ITEM 1A. RISK FACTORS
Please refer to Part I, Item 1A—Risk Factors of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and Part I, Item 3—Quantitative and Qualitative Disclosures About Market Risk of this Quarterly Report on Form 10-Q. Any of these factors could result in a significant or material adverse effect on the Company’s business, results of operations, or financial condition.
There have been no material changes to the Company’s risk factors since its Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Additional risk factors not presently known to the Company or that the Company currently deems immaterial may also impair its business, results of operations, or financial condition.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable
ITEM 5. OTHER INFORMATION
Director and Officer Trading Arrangements
No directors or executive
officers of the Company
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ITEM 6. EXHIBITS
| * | Filed herewith |
| ** | Furnished herewith |
| † | Schedules and exhibits to this Exhibit omitted pursuant to Regulation S-K Item 601(b)(2). The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. |
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SIGNATURE
In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| STARDUST POWER INC. | ||
| Dated: November 13, 2025 | /s/ Udaychandra Devasper | |
| Name: | Udaychandra Devasper | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) | ||
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Exhibit 31.1
CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a) AND RULE 15d-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Roshan Pujari, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q of Stardust Power Inc.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| November 13, 2025 | By: | /s/ Roshan Pujari |
| Roshan Pujari | ||
| Chief Executive Officer and Chairman | ||
| (Principal Executive Officer) |
Exhibit 31.2
CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a) AND RULE 15d-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Udaychandra Devasper, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q of Stardust Power Inc.; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| November 13, 2025 | By: | /s/ Udaychandra Devasper |
| Udaychandra Devasper | ||
| Chief Financial Officer | ||
| (Principal Financial and Accounting Officer) |
Exhibit 32.1
CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Stardust Power Inc. (the “Company”) for the quarter ended September 30, 2025, as filed with the Securities and Exchange Commission (the “Report”), I, Roshan Pujari, Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
| 1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and | |
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report. |
| November 13, 2025 | By: | /s/ Roshan Pujari |
| Roshan Pujari | ||
| Chief Executive Officer and Chairman | ||
| (Principal Executive Officer) |
Exhibit 32.2
CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Stardust Power Inc. (the “Company”) for the quarter ended September 30, 2025, as filed with the Securities and Exchange Commission (the “Report”), I, Udaychandra Devasper, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
| 1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and | |
| 2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the report. |
| November 13, 2025 | By: | /s/ Udaychandra Devasper |
| Udaychandra Devasper | ||
| Chief Financial Officer | ||
| (Principal Financial Officer) |