BKV Corporation (BKV) Risk Analysis

Potential transactions we consider may be subject to regulatory review and approval requirements by governmental entities, or ultimately prohibited. For example, CFIUS has authority to review direct or indirect foreign investments in U.S. companies. Among other things, CFIUS is empowered to require certain foreign investors to make mandatory filings, to charge filing fees related to such filings, and to self-initiate national security reviews of foreign direct and indirect investments in U.S. companies if the parties to that investment choose not to file voluntarily. In the case that CFIUS determines an investment to be a threat to national security, CFIUS has the power to unwind or place restrictions on the investment. Whether CFIUS has jurisdiction to review an acquisition or investment transaction depends on, among other factors, the nature and structure of the transaction, including the level of beneficial ownership interest and the nature of any information or governance rights involved. For example, investments that result in "control" of a U.S. business by a foreign person are always subject to CFIUS jurisdiction. CFIUS's expanded jurisdiction under the Foreign Investment Risk Review Modernization Act of 2018 and implementing regulations that became effective on February 13, 2020 further includes investments that do not result in control of a U.S. business by a foreign person but afford certain foreign investors certain information or governance rights in a U.S. business that has a nexus to "critical technologies," "critical infrastructure," and/or "sensitive personal data." For so long as Banpu retains a material ownership interest in us, we may be deemed a "foreign person" under the regulations relating to CFIUS. As such, potential transactions involving a U.S. business or foreign business with U.S. subsidiaries that we may wish to pursue may be subject to CFIUS review. If a particular transaction falls within CFIUS's jurisdiction, we may either determine that we are required to make a mandatory filing, submit to CFIUS review on a voluntary basis, or proceed with the transaction without submitting to CFIUS and risk CFIUS intervention, before or after closing the transaction. CFIUS may decide to block or delay transactions that could benefit our stockholders, impose conditions with respect to such transactions or request the President of the United States to order us to divest all or a portion of the assets or companies we acquired without first obtaining CFIUS approval, which may limit the attractiveness of, delay or prevent us from pursuing certain target companies or assets that we believe would otherwise be beneficial to us and our stockholders, any of which could have a material adverse effect on our financial condition, results of operations, and cash flows.

As of February 27, 2026, Banpu indirectly owns approximately 67.6% of our outstanding common stock. Our outstanding common stock is entitled to one vote per share. As a result of this ownership, Banpu has a significant influence on our affairs and its voting power constitutes a significant majority percentage of any quorum of our stockholders voting on any matter requiring the approval of our stockholders. Such matters include the election of directors, the adoption of amendments to our certificate of incorporation and bylaws, and the approval of mergers or the sale of all or substantially all of our assets. Banpu's control or significant influence over us also may delay, defer, or prevent an acquisition by a third party or other change of control of our Company and may make some transactions more difficult or impossible without the support of Banpu, even if such events are in the best interests of our other stockholders. In addition, under our Stockholders' Agreement, as long as BNAC beneficially owns 10% or more of our voting stock, BNAC will be entitled to designate for nomination to our board of directors a number of individuals approximately proportionate to such beneficial ownership, provided that (i) from September 27, 2025 until the first date on which BNAC beneficially owns 50% or less of our voting stock, at least four board seats will not be BNAC designees, and (ii) from and after the first date on which BNAC beneficially owns 50% or less of our voting stock, a number of board seats equal to the minimum number of directors that would constitute a majority of the total number of directors comprising our board of directors will not be BNAC designees. Further, if any person or group (other than Banpu and its controlled affiliates, excluding portfolio companies and operating companies) acquires 35% or more of our equity interests, or if any person or group acquires a greater percentage of our equity interests than are then held by Banpu and its controlled affiliates (excluding portfolio companies and operating companies of Banpu), such event will be an event of default under the RBL Credit Agreement, which may result in the amounts owed by us thereunder to become immediately due and payable. Further, if, any person or group (other than Banpu and its controlled affiliates) acquires more than 50% of our equity interests, unless Banpu and its controlled retain the right to appoint a majority of the directors of BKV Upstream Midstream, and Moody's or S&P decreases their rating of the 2030 Senior Notes as a result thereof within 60 days, holders of the 2030 Senior Notes will be entitled to a require BKV Upstream Midstream to repurchase all or any part of that holder's 2030 Senior Notes pursuant to an offer on the terms set forth in the indenture governing the 2030 Senior Notes. Banpu also exercises significant influence over the BKV-BPP Cotton Cove Joint Venture and the BKV-BPP Power Joint Venture, each of which requires the consent of BPPUS for certain material actions. The BKV-BPP Cotton Cove Joint Venture is controlled by its six-member board of managers, four of whom are appointed by BKV dCarbon Ventures (our wholly-owned subsidiary) and two of whom are appointed by BPPUS. Of the three members appointed by us, none are employees of Banpu who also serve on our board of directors. For additional information, see "- Risks Related to Our CCUS Business -?We operate the Cotton Cove Project through a joint venture that requires the consent of BPPUS for certain material actions." The BKV-BPP Power Joint Venture is controlled by its twelve-member board of managers (the "Power JV Board"), nine of whom are appointed by us and three of whom are appointed by BPPUS. For as long as BPPUS maintains an ownership interest in the BKV-BPP Power Joint Venture of at least 10%, consent from at least one member of the Power JV Board appointed by BPPUS will be required for certain specified actions as detailed in the BKV-BPP Power LLC Agreement. For additional information, see "- Risks Related to Our Power Generation Business - We operate our power generation business through a joint venture that requires the consent of BPPUS for certain material actions." The interests of Banpu may differ from our interests or those of our other stockholders and the concentration of control in Banpu will limit other stockholders' ability to influence corporate matters. Banpu may take actions that our other stockholders do not view as beneficial or decline to take actions that our other stockholders view as beneficial, which may adversely affect our business, financial condition, and results of operations. In addition, Banpu's control or significant influence over us may have an adverse effect on the price of our common stock.

Banpu beneficially controls a significant majority of the voting power of our outstanding voting stock. Pursuant to our Stockholders' Agreement, BNAC, through ownership interests in us held by BNAC, has certain rights to designate individuals for nomination to our board of directors. Under the NYSE rules, a company of which more than 50% of the voting power is held by another person or group of persons acting together is a controlled company and may elect not to comply with certain NYSE corporate governance requirements, including the requirements that: - a majority of the board of directors consist of independent directors;- the corporate governance and nominating committee be composed entirely of independent directors with a written charter addressing the committee's purpose and responsibilities;- the compensation committee be composed entirely of independent directors with a written charter addressing the committee's purpose and responsibilities; and - there be an annual performance evaluation of the nominating and governance and compensation committees. These requirements will not apply to us as long as we remain a controlled company. Accordingly, the same protections afforded to stockholders of companies that are subject to all of the NYSE corporate governance requirements are not afforded to our stockholders.

Banpu could have interests that differ from, or conflict with, the interests of our other stockholders and could cause us to take certain actions even if the actions are not favorable to us or our other stockholders or are opposed by our other stockholders. Potential conflicts of interest or disputes may arise between Banpu and us in a number of areas relating to our past or ongoing relationships, including: - tax, employee benefits, indemnification, and other matters arising from our status as a publicly traded company;- employee retention and recruiting;- corporate opportunities that may be attractive to both Banpu and us;- the arrangements governing the BKV-BPP Power Joint Venture, BKV-BPP Cotton Cove Joint Venture, and any other new commercial arrangements between the Company and affiliates of Banpu in the future; and - sales or other disposals by Banpu of all or a portion of its interest in us. We may not be able to resolve potential conflicts and disputes with Banpu and even if we do, the resolution may be less favorable to us than if we were dealing with an unaffiliated third party. Because we are controlled and significantly influenced by Banpu, we may not have the leverage to negotiate amendments to the arrangements governing the BKV-BPP Power Joint Venture or BKV-BPP Cotton Cove Joint Venture (if any are required) on terms as favorable to us as those we would negotiate with an unaffiliated third party. As a result of Banpu's relationship with us, Banpu will have significant influence over our affairs and potentially those of the BKV-BPP Power Joint Venture and could exercise such influence in a manner that is not in the best interests of our stockholders. Additionally, there can be no assurance that Banpu will not engage in competition with us in the future. Our certificate of incorporation provides that, to the fullest extent permitted by law, neither Banpu nor its affiliates or any director who is not employed by us (including any non-employee director who serves as one of our officers in both his or her director and officer capacities) or his or her affiliates will have any duty to refrain from (i) engaging in the same or similar business activities or lines of business in which we or our affiliates now engage or propose to engage or (ii) otherwise competing with us or our affiliates. In addition, to the fullest extent permitted by law, in the event that Banpu or its affiliates, or any non-employee director, acquires knowledge of a potential transaction or other business opportunity that may be a corporate opportunity for itself, himself or herself, or its, or his or her affiliates, or for us or any of our affiliates, such person will have no duty to communicate or offer such transaction or business opportunity to us or any of our affiliates. They may take any such opportunity for themselves or offer it to another person or entity. Our certificate of incorporation also renounces, to the fullest extent permitted by law, any interest or expectancy that we have in, or right to be offered an opportunity to participate in, specified business opportunities that are, from time to time, presented to our officers, directors, or stockholders or their respective affiliates, other than those officers, directors, stockholders, or affiliates who are our, or our subsidiaries' employees. Generally, neither Banpu nor our non-employee directors, who also are directors, officers, employees, agents, or affiliates of Banpu or its affiliates (other than us), will be liable to us or our stockholders for breach of any fiduciary duty solely due to the fact that any such person pursues or acquires any corporate opportunity for, or recommends or transfers any corporate opportunity to, Banpu or its affiliates (other than us), rather than to us. This renunciation will not extend to corporate opportunities expressly offered to one of our non-employee directors solely in his or her capacity as our director or officer. These provisions create the possibility that a corporate opportunity of our Company may be used for the benefit of Banpu and may significantly impair our ability to grow. In addition, Christopher Kalnin serves as a member of Banpu's Executive Committee with responsibilities to Banpu to, among other things, manage all aspects of Banpu's business in North America. Although our corporate opportunity policy requires Mr. Kalnin to present applicable business opportunities sourced by him to our Company before such opportunities may be presented to Banpu, Banpu or its affiliates may compete with us for acquisition or other business opportunities.

Christopher Kalnin currently serves as a member of Banpu's Executive Committee with responsibilities to Banpu to, among other things, manage all aspects of Banpu's business in North America. Seven of our directors are employees of Banpu or its affiliates. In addition, most of our directors now own, or our officers and other directors may own in the future, capital stock or equity awards in Banpu or its affiliates. For certain of these individuals, their holdings of common stock or equity awards in Banpu or its affiliates may be significant compared to their total assets. Their position at Banpu or its affiliates and the ownership of capital stock or equity awards in Banpu or its affiliates creates, or may create the appearance of, conflicts of interest when these directors and officers are faced with decisions that could have different implications for Banpu than for us. These decisions could include: - corporate opportunities;- the impact that operating or capital decisions (including the incurrence of indebtedness) relating to our business may have on Banpu's consolidated financial statements or current or future indebtedness (including related covenants);- business combinations involving us;- our dividend and stock repurchase policies;- compensation and benefit programs and other human resources policy decisions;- management of stock ownership;- the payment of dividends on our common stock; and - determinations with respect to our tax returns. As a result of these actual or apparent conflicts of interest, we may be precluded from pursuing certain growth initiatives or transactions that may be favorable to us or we may take certain actions even if the actions are not favorable to us or are opposed by our stockholders.

The BKV-BPP Joint Venture Transaction is considered a "Related Party" transaction pursuant to Rule 312.03 of the NYSE Listed Company Manual. BPPUS is a wholly-owned subsidiary of Banpu Power, which is a subsidiary of Banpu, and Banpu is the ultimate parent company of both BKV and BKV's majority stockholder, BNAC. Although our board of directors implemented procedural safeguards, including the formation of a special committee consisting solely of independent and disinterested directors, these overlapping relationships may create the perception that the BKV-BPP Joint Venture Transaction was not negotiated at arm's length. Such perceptions could lead to negative stockholder sentiment, potential claims, or increased regulatory scrutiny.

Some provisions of our governing documents could make it more difficult for a third party to acquire control of us, even if the change of control would be beneficial to our stockholders, including: - providing for a classified board of directors;- limitations on the removal of directors;- limitations on the ability of our stockholders to call special meetings;- establishing advance notice provisions for stockholder proposals and nominations for elections to the board of directors to be acted upon at meetings of stockholders;- the requirement that the affirmative vote of the holders of at least 66 2/3% in voting power of all the then-outstanding shares of our stock be obtained to amend and restate our existing bylaws or to remove directors;- the requirement that the affirmative vote of the holders of at least 66 2/3% in voting power of all the then-outstanding shares of our stock (or, if approved by at least 60% of our board of directors, a majority in voting power of all the then-outstanding shares of our stock) be obtained to amend our certificate of incorporation; and - providing that the board of directors is expressly authorized to make, repeal, alter, amend, and rescind our bylaws. In addition, the existence of significant stockholders, such as our sponsor, Banpu, and its affiliates, may have the effect of deterring hostile takeovers, delaying or preventing changes in control or changes in management, or limiting the ability of our other stockholders to approve transactions that they may deem to be in the best interests of the Company. Banpu is the ultimate parent company of BPPUS and BNAC and, as a result, Banpu's concentration of stock ownership increased upon the issuance of 5,315,390 shares of common stock issued to BPPUS in connection with the closing of the BKV-BPP Power Joint Venture Transaction. Moreover, Banpu's concentration of stock ownership in us may adversely affect the trading price of our common stock to the extent investors perceive a disadvantage in owning stock of a company with a significant stockholder.

As of February 27, 2026, Banpu, the ultimate parent of BPPUS and BNAC, is the indirect beneficial owner of 69,193,004 shares of common stock, representing approximately 67.6% of our total outstanding common stock, and management, directors, and other employee and non-employee stockholders, collectively, own 33,095,073 shares of common stock, representing approximately 32.4% of our total outstanding common stock. In addition, our Stockholders' Agreement provides BNAC and its affiliates with the right, in certain circumstances, to require us to register their shares of our common stock constituting registrable securities under the Securities Act for sale into the public markets. In accordance with the registration rights granted to BNAC, on October 1, 2025, we filed a resale registration statement on Form S-3 to register the offer and sale of 63,877,614 shares of common stock owned by BNAC, and subsequently amended the resale registration statement on November 25, 2025. As of the date of this Annual Report on Form 10-K, no shares of our common stock have been sold by BNAC pursuant to that resale registration statement. In connection with the closing of the Bedrock Acquisition, we entered into a Registration Rights Agreement with Bedrock Energy Partners, LLC ("Bedrock Energy Partners"), pursuant to which we agreed to, among other things, provide Bedrock Energy Partners with certain demand and piggyback registration rights for the 5,233,957 shares of common stock received in the Bedrock Acquisition, subject to customary cutbacks, blackout periods, and other limitations. In accordance with the registration rights granted to Bedrock Energy Partners, on December 23, 2025, we filed an automatic shelf registration statement on Form S-3 to register the offer and sale of 5,233,957 shares of our common stock owned by Bedrock Energy Partners. As of the date of this Annual Report on Form 10-K, no shares of our common stock have been sold by Bedrock Energy Partners pursuant to that resale registration statement. In connection with the closing of the BKV-BPP Power Joint Venture Transaction, we also entered into a Registration Rights Agreement with BPPUS, pursuant to which BPPUS received certain demand and piggyback registration rights for the 5,315,390 shares of common stock issued to BPPUS in the BKV-BPP Power Joint Venture Transaction, subject to a 180-day lock-up and customary cutbacks, blackout periods and other limitations. We also may, in the future, issue additional shares of common stock as some or all of the consideration for future transactions. Furthermore, we may issue additional shares of common stock or convertible securities in subsequent public offerings. We cannot predict the size of future issuances of our common stock or securities convertible into common stock or the effect, if any, that future issuances of our common stock will have on the market price of our common stock. Issuances of substantial amounts of our common stock or sales of shares owned by Banpu and other stockholders, or the perception that such issuances or sales could occur, may adversely affect prevailing market prices of our common stock. Our common stock does not entitle the holders thereof to preemptive rights to buy shares from us. As a result, stockholders will not have the automatic ability to avoid dilution in their percentage ownership of us.

If we raise more equity capital from the sale of common stock, institutional or other investors may negotiate terms more favorable than the current prices of our common stock. If we issue debt securities, the holders of the debt would have a claim to our assets that would be prior to the rights of stockholders until the debt is paid. Interest on these debt securities would increase costs and could negatively impact our operating results. In accordance with Delaware law and the provisions of our certificate of incorporation, we may issue one or more classes or series of preferred stock that ranks senior in right of dividends, liquidation or voting to our common stock. Preferred stock may have such designations, preferences, limitations and relative rights, including preferences over our common stock respecting dividends and distributions, as our board of directors may determine, and the issuance of preferred stock would dilute the ownership of our existing stockholders. The terms of one or more classes or series of preferred stock could adversely impact the voting power or value of our common stock. For example, we might grant holders of preferred stock the right to elect some number of our directors in all events or on the happening of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of the common stock. The terms of any series of preferred stock may also reduce or eliminate the amount of cash available for payment of dividends to our holders of common stock or subordinate the claims of our holders of common stock to our assets in the event of our liquidation. Our common stock is not subject to conversion, redemption or sinking fund provisions.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business. If one or more of these analysts cease coverage of the Company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. Moreover, if one or more of the analysts who cover the Company downgrades our common stock or if our operating results do not meet their expectations, our stock price could decline.

Our certificate of incorporation provides that unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will, to the fullest extent permitted by law, be the sole and exclusive forum for any (i) derivative action or proceeding brought on behalf of the Company, (ii) action asserting a claim of breach of a fiduciary duty owed by any director, officer or employee of the Company to the Company or our stockholders, (iii) action asserting a claim against the Company or any director or officer of the Company arising pursuant to any provision of the Delaware General Corporation Law or our governing documents, or (iv) action asserting a claim against the Company or any director, officer or employee of the Company, which claim is governed by the internal affairs doctrine. Notwithstanding the foregoing sentence, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under U.S. federal securities laws, including the Securities Act and the Exchange Act. This choice of forum may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, employees or agents, which may discourage such lawsuits against us and such persons. Alternatively, if a court were to find these provisions of our governing documents inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our financial condition, results of operations, and cash flows.

The market price of our common stock has experienced volatility and may fluctuate significantly in response to a number of factors, many of which we cannot predict or control, including supply of and demand for natural gas and NGLs and the prices of natural gas and NGLs, the level of global drilling, exploration and production activities, general market and economic conditions, disruptions, downgrades, credit events and perceived problems in the credit markets; actual or anticipated variations in our operating results; changes in our investments or asset composition; write-downs or perceived credit or liquidity issues affecting our assets; market perception of our business and our assets; reports by industry analysts; changes in our financial guidance or negative announcements by our customers, competitors or suppliers regarding their own performance; our level of indebtedness or adverse market reaction to any indebtedness that we may incur in the future; our ability to raise capital on favorable terms or at all; loss of any major funding source; additions or departures of our executive officers or key personnel; changes in market valuations of similar companies; and speculation in the press or investment community. Securities markets in general have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. Any broad market fluctuations may adversely affect the trading price of our common stock.