RFP 120277 O3 REBID Financial Statements File 2 of 7.pdf

Annual Report

December 31, 2024

ManTech International Corporation

IRS Employer Identification Number 22-1852179

Address of Principal Executive Offices 2251 Corporate Park Drive

Herndon, VA 20171

TABLE OF CONTENTS

Financial Statements Independent Auditor’s Report 3 Consolidated Balance Sheets 6 Consolidated Statements of Loss 7 Consolidated Statements of Comprehensive Loss 8 Consolidated Statements of Shareholders’ Equity 9 Consolidated Statements of Cash Flows 10 Notes 12

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Report of Independent Auditors

Management and the Board of Directors ManTech International Corporation

Opinion

We have audited the consolidated financial statements of ManTech International Corporation (the “Company”), which comprise the consolidated balance sheet as of December 31, 2024, and the related consolidated statements of loss, comprehensive loss, changes in shareholders’ equity and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024, and the results of its operations and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Other Matter

The financial statements of the Company for the year ended December 31, 2023 (successor), the period from September 14, 2022 to December 31, 2022 (successor) and the period from January 1, 2022 to September 13, 2022 (predecessor), were audited by another auditor who expressed an unmodified opinion on those financial statements on March 8, 2024.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year after the date that the financial statements are available to be issued.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free of material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

• Exercise professional judgment and maintain professional skepticism throughout the audit.

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks.

Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, no such opinion is expressed.

• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

February 26, 2025

MANTECH INTERNATIONAL CORPORATION

CONSOLIDATED BALANCE SHEETS

(In Thousands, except share and per share amounts) Successor

December 31, December 31, ASSETS

Cash and cash equivalents $ 142,833 $ 113,919 Receivables—net 474,858 512,005 Prepaid expenses 40,233 43,279 Taxes receivable—current 14,453 3,509 Assets held for sale — 77,072 Other current assets 35,236 22,400 Total Current Assets 707,613 772,184 Goodwill 2,573,950 2,584,122 Other intangible assets—net 1,543,888 1,673,795 Property and equipment—net 103,850 119,173 Operating lease right of use assets 90,182 82,200 Investments 7,573 7,728 Other assets 39,468 13,415

TOTAL ASSETS $ 5,066,524 $ 5,252,617

LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES

Accounts payable $ 205,847 $ 220,026 Accrued salaries and related expenses 141,780 133,105 Contract liabilities 64,815 56,610 Accrued interest expense 38,695 45,636 Operating lease obligations—current 21,931 23,017 Debt—current 21,862 22,780 Liabilities held for sale — 8,247 Other current liabilities 19,365 16,157 Total Current Liabilities 514,295 525,578 Debt—long term 2,105,616 2,176,596 Deferred income taxes 243,540 295,300 Operating lease obligations—long term 86,470 82,127 Other long-term liabilities 23,483 25,134

TOTAL LIABILITIES 2,973,404 3,104,735

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY

Additional paid-in capital 2,296,642 2,290,088 Accumulated deficit (201,701) (132,907) Accumulated other comprehensive loss (1,821) (9,299) Common stock—$0.01 par value; 1,000 shares authorized; 1,000 shares issued at December 31, 2024 and 2023; 1,000 shares outstanding at December 31, 2024 and 2023 — —

TOTAL SHAREHOLDERS' EQUITY 2,093,120 2,147,882

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 5,066,524 $ 5,252,617

See notes to consolidated financial statements.

CONSOLIDATED STATEMENTS OF LOSS

(In Thousands)

Successor Predecessor For the year ended For the period For the period

December 31, December 31, September 14, 2022 to December

31, 2022

January 1, 2022 to September 13, REVENUE $ 3,115,954 $ 3,032,101 $ 843,421 $ 1,892,486

Cost of services 2,601,530 2,577,450 728,699 1,614,894 General and administrative expenses 360,515 333,036 114,909 276,148

OPERATING INCOME

(LOSS) 153,909 121,615 (187) 1,444

Interest expense (238,994) (243,956) (63,417) (6,565) Loss on debt extinguishment (3,290) — — — Interest income 4,049 4,591 337 257 Other income (expense), net (922) (21) 77 (30)

LOSS FROM

OPERATIONS BEFORE

INCOME TAXES AND

EQUITY METHOD

INVESTMENTS (85,248) (117,771) (63,190) (4,894)

Benefit (provision) for income taxes 15,709 40,099 7,671 (15,078) Equity in earnings of unconsolidated subsidiaries 745 284 — —

NET LOSS $ (68,794) $ (77,388) $ (55,519) $ (19,972)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In Thousands)

Successor Predecessor For the year ended For the period For the period

December 31, December 31, September 14, 2022 to December

31, 2022

January 1, 2022 to September 13, NET LOSS $ (68,794) $ (77,388) $ (55,519) $ (19,972)

OTHER COMPREHENSIVE

INCOME (LOSS):

Deferral of cash flow hedges, net of tax 7,491 (4,356) (4,908) — Translation adjustments, net of tax (13) (32) (3) (45) Actuarial loss on defined benefit pension plans, net of tax — — — (63)

Total other comprehensive income (loss) 7,478 (4,388) (4,911) (108)

COMPREHENSIVE LOSS $ (61,316) $ (81,776) $ (60,430) $ (20,080)

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(In Thousands)

Successor Predecessor For the year ended For the period For the period

December 31, December 31, September 14, 2022 to December

31, 2022

January 1, 2022 to September 13, Additional Paid-In Capital

At beginning of period $ 2,290,088 $ 2,257,131 $ — $ 566,573 Share compensation expense 6,541 6,078 1,001 11,805 Contributions from Parent 13 26,879 2,256,130 — Stock compensation liability — — — (14,533) Stock option exercises — — — 5,305 Payment consideration to tax authority on employees' behalf — — — (4,035) At end of period 2,296,642 2,290,088 2,257,131 565,115

Retained Earnings (Accumulated Deficit)

At beginning of period (132,907) (55,519) — 1,117,867 Net loss (68,794) (77,388) (55,519) (19,972) Dividends — — — (33,547) At end of period (201,701) (132,907) (55,519) 1,064,348

Accumulated Other Comprehensive Loss

At beginning of period (9,299) (4,911) — (273) Other comprehensive income (loss), net of tax 7,478 (4,388) (4,911) (108) At end of period (1,821) (9,299) (4,911) (381)

Common stock At beginning of period — — — — Issuance of common stock — — — — At end of period — — — —

Common stock, Class A At beginning of period — — — 279 Conversion Class B to Class A common stock — — — 116 Share compensation expense — — — 1 Stock option exercises — — — 1 At end of period — — — 397

Common stock, Class B At beginning of period — — — 132 Conversion Class B to Class A common stock — — — (116) At end of period — — — 16

Treasury stock, at cost At beginning of period — — — (9,158) At end of period — — — (9,158)

Total Shareholders' Equity $ 2,093,120 $ 2,147,882 $ 2,196,701 $ 1,620,337

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands) Successor Predecessor

For the year ended For the period For the period

December 31, 2024 December 31, 2023

September 14, 2022 to December 31, January 1, 2022 to September 13, 2022

CASH FLOWS FROM (USED IN)

OPERATING ACTIVITIES:

Net loss $ (68,794) $ (77,388) $ (55,519) $ (19,972) Adjustments to reconcile net loss to net cash flows from operating activities:

Depreciation and amortization of property, equipment and intangible assets 165,710 165,558 45,556 54,672 Deferred income taxes (53,924) (77,233) (21,078) (3,325) Noncash lease expense 24,139 30,229 6,628 21,621 Amortization of deferred costs 8,474 8,018 2,396 5,331 Share compensation expense 6,541 6,078 1,001 57,093 Loss on debt extinguishment 3,290 — — — Fixed asset impairment 2,625 — — — Contract loss reserve (1,066) (10) (421) (1,391) Return on equity investment 783 — — — Equity in earnings of unconsolidated subsidiaries (745) (284) — — Loss on sale and retirement of property and equipment 502 1,355 — — Loss on disposition of business 358 — — — Bad debt expense — (8) — (1,247)

Change in assets and liabilities—net of effects from acquired businesses:

Receivables—net 32,937 (39,014) (1,867) 14,860 Prepaid expenses 3,110 (9,440) 7,250 (6,148) Taxes receivable—current (9,617) 20,842 8,831 (5,765) Other current assets (3,182) (119) 965 5,183 Employee supplemental savings plan asset—current — (1,160) 1,015 — Employee supplemental savings plan asset—long term — — — 6,294 Other assets (23,843) (30) 1,480 (503) Accounts payable (15,427) 38,425 (3,078) 48,375 Accrued salaries and related expenses 9,458 12,694 (100,551) 27,135 Contract liabilities 9,764 16,459 1,217 (3,814) Accrued interest expense (7,059) (884) 44,143 470 Accrued retirement—current — (21,077) (5,435) — Other current liabilities (419) 3,754 712 (4,363) Operating lease obligations (24,794) (30,633) (8,329) (24,964) Accrued retirement—long term — — — (9,541) Other long—term liabilities 7,621 (6,805) 1,105 1,709 Other (1,818) 533 (456) (1,018)

Net cash from (used in) operating activities 64,624 39,860 (74,435) 160,692

CASH FLOWS FROM (USED IN)

INVESTING ACTIVITIES:

Proceeds from disposition of business 71,438 — — — Purchases of property and equipment (28,146) (34,948) (10,337) (29,326) Proceeds from sale of property and equipment 2,759 633 58 1,203

Acquisition of businesses—net of cash acquired 798 (194,637) (4,109,711) 2,369 Payments to acquire investments (22) — — — Proceeds from corporate owned life insurance — 27,459 4,331 5,311 Investment in capitalized software for internal use — (1,978) — (375) Net cash from (used in) investing activities 46,827 (203,471) (4,115,659) (20,818)

CASH FLOWS FROM (USED IN)

FINANCING ACTIVITIES:

Borrowings under credit facility 149,000 522,000 37,500 338,500 Repayments under credit facility (149,000) (522,000) (37,500) (458,500) Repayments of debt (82,090) (21,890) (5,250) — Issuance of debt 985 178,000 2,048,000 — Deferred financing fees (716) (1,780) (12,349) — Debt extinguishment costs (555) — — — Principal paid on financing leases (174) (103) (13) — Contributions from Parent 13 26,879 2,256,130 — Dividends paid — — — (33,574) Proceeds from exercise of stock options — — — 5,306 Payment consideration to tax authority on employee's behalf — — — (4,035) Net cash from (used in) financing activities (82,537) 181,106 4,286,518 (152,303)

NET CHANGE IN CASH AND CASH

EQUIVALENTS 28,914 17,495 96,424 (12,429)

CASH AND CASH EQUIVALENTS,

BEGINNING OF PERIOD 113,919 96,424 — 53,374

CASH AND CASH EQUIVALENTS,

END OF PERIOD $ 142,833 $ 113,919 $ 96,424 $ 40,945

SUPPLEMENTAL CASH FLOW

INFORMATION

Cash paid for interest $ 245,994 $ 238,222 $ 17,400 $ 6,020 Noncash investing and financing activities:

Operating lease obligations arising from obtaining right of use assets $ 37,410 $ 37,690 $ 1,691 $ 27,505 Noncash investing activities $ 3,532 $ 519 $ (527) $ (380) Finance lease obligations arising from obtaining right of use assets $ — $ 598 $ — $ 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Description of the Business

ManTech International Corporation (depending on the circumstances, “ManTech” “Company” “we” “our” “ours” or “us”) provides mission-focused technology solutions and services for U.S. defense, intelligence community and federal civilian agencies. We excel in full-spectrum cyber, secure mission & enterprise IT, advanced data analytics, software and systems development, intelligent systems engineering, intelligence mission support and mission operations.

On May 14th, 2022, Moose BidCo, Inc. (BidCo) and Moose Merger Sub, Inc. (Acquirer), entered into an Agreement and Plan of Merger (Merger Agreement) with ManTech (Predecessor) to acquire all membership equity interests in the Company (the Acquisition), which subsequently closed on September 14, 2022 (Closing Date).

BidCo and Acquirer are both wholly owned subsidiaries of Moose Holdings, Inc. (Parent), who is a wholly owned subsidiary of Carlyle Partners VIII, L.P. (Carlyle), who formed these entities to facilitate the Merger Agreement.

Acquirer received a cash contribution from Carlyle of $2.25 billion and independently issued $2.14 billion of debt to fund the transaction prior to the Closing Date. On the Closing Date, Acquirer merged with ManTech and ManTech (Successor) continued as the surviving corporation under direct ownership of BidCo and Parent.

The Acquisition was accounted for as a business combination under Accounting Standards Codification (ASC) 805, Business Combinations. In accordance with ASC 805, the total purchase price was allocated to net tangible and identifiable intangible assets and liabilities based on their estimated fair values as of the effective date of the Acquisition. The purchase price allocation reflects management’s estimates and judgments in determining the fair value of the assets acquired and liabilities assumed using all relevant information. The excess of the purchase price over the net tangible and identifiable intangible assets acquired and liabilities assumed was recorded as goodwill.

The new basis of accounting will be the basis of the accounting records in the preparation of future financial statements and related disclosures after the Acquisition date. This change in accounting basis is represented in the consolidated financial statements by a black line distinguishing the Predecessor and Successor periods on the statements and in the relevant notes. The black line signifies that the amounts shown for the periods prior to and subsequent to the Acquisition are not comparable. Refer to Note 3 - Business Combinations for additional information.

2. Summary of Significant Accounting Policies

Principles of Consolidation—Our consolidated financial statements include the accounts of ManTech International Corporation, subsidiaries we control and variable interest entities that are required to be consolidated.

All intercompany accounts and transactions have been eliminated.

Use of Accounting Estimates—We prepare our consolidated financial statements in conformity with U.S.

Generally Accepted Accounting Principles, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. These estimates involve judgments with respect to, among other things, various future economic factors that are difficult to predict and are beyond our control. Therefore, actual amounts could differ from these estimates.

Business Combinations—The accounting for our business combinations consists of allocating the purchase price to tangible and intangible assets acquired and liabilities assumed based on their estimated fair values, with the excess recorded as goodwill. We have up to one year from the Acquisition date to use information to adjust the fair value of the acquired assets and liabilities as of the Acquisition date, which may result in material changes to their recorded values with an offsetting adjustment to goodwill. Determining the fair value of assets acquired and liabilities assumed requires significant judgment, which includes, among other factors, analysis of historical performance and estimates of future performance. In some cases, we have used discounted cash flow analyses, which were based on our best estimate of future revenue, earnings and cash flows as well as our discount rate, adjusted for risk, and estimated attrition rates. We apply ASC 606, Revenue from Contracts with Customers, to recognize and measure contract assets and contract liabilities in a business combination.

Disposal Group as Held for Sale—A long-lived asset classified as held for sale (but not qualifying for presentation as a discontinued operation in the statement of financial position) will be presented separately in our Consolidated Balance Sheets. The assets and liabilities of a disposal group classified as held for sale are presented separately in the asset and liability sections, respectively, of our Consolidated Balance Sheets. Those assets and liabilities will not be netted and presented as a single amount.

Fair Value of Financial Instruments—The carrying value of our cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate their fair value because of the short-term nature of these amounts.

Derivative financial instruments are recognized as assets and liabilities in the financial statements and measured at fair value on a recurring basis. Our derivative financial instruments are designated as cash flow hedges and are highly effective. The gain or loss on our derivative financial instruments designated as cash flow hedges are recorded as a component of Other comprehensive income (loss) and subsequently reclassified into Interest expense in the same period(s) during which the hedged transaction affects earnings. The gain or loss on our derivative financial instruments that are not highly effective is immediately recognized in earnings. The impact of derivative instruments is included in Net cash from (used in) operating activities on our Consolidated Statements of Cash Flows.

Cash and Cash Equivalents—For the purpose of reporting cash flows, Cash and cash equivalents include cash on hand, amounts due from banks and short-term investments with maturity dates of three months or less at the date of purchase. Our Cash and cash equivalents exceed those that are federally insured. To date, we have not incurred any losses caused by uninsured balances.

Receivables—Receivables include amounts billed and currently due from our customers, amounts billable where the right to consideration is unconditional and amounts unbilled. The portion of the payments retained by the customer until final contract settlement is not considered a significant financing component because the intent is to protect the customer.

Contract Assets (Unbilled Receivables)—Amounts are invoiced as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals or upon achievement of contractual milestones. Generally revenue recognition occurs before billing, resulting in contract assets. These contract assets are referred to as unbilled receivables and are reported within Receivables—net on our Consolidated Balance Sheets.

Goodwill—The purchase price of an acquired business is allocated to the tangible assets, financial assets and separately recognized intangible assets acquired less liabilities assumed based upon their respective fair values, with the excess recorded as Goodwill. We review Goodwill at least annually for impairment, or whenever events or circumstances indicate that the carrying value of long—lived assets may not be fully recoverable. We have elected to perform this annual review as of October 31st of each calendar year.

In reviewing Goodwill for impairment, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the estimated fair value of a reporting unit is less than its carrying amount. If we elect to perform a qualitative assessment and determine that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, then we will perform the quantitative impairment test (described below). We also may bypass the qualitative assessment for any reporting unit in any period and proceed directly to perform the quantitative impairment test.

The quantitative goodwill impairment test is used to identify both the existence of impairment and the amount of the impairment loss, and compares the fair value of a reporting unit with its carrying amount including Goodwill.

If the fair value of a reporting unit exceeds its carrying amount, the goodwill of the reporting unit is not impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in the amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.

The fair values of the reporting units are determined based on a weighting of the income approach, market approach and market transaction approach. The income approach is a valuation technique in which fair value is based from forecasted future cash flows discounted at the appropriate rate of return commensurate with the risk as well as current rates of return for equity and debt capital as of the valuation date. The forecast used in our estimation of fair value was developed by management based on a contract basis, incorporating adjustments to reflect known contract and market considerations (such as reductions and uncertainty in government spending, pricing pressure and opportunities). The discount rate utilizes a risk adjusted weighted average cost of capital. The market approach is a valuation technique in which the fair value is calculated based on market prices realized in actual arm's length transactions. The technique consists of undertaking a detailed market analysis of publicly traded companies that provides a reasonable basis for comparison to us. Valuation ratios, which relate market prices to selected financial statistics derived from comparable companies, are selected and applied to us after consideration of adjustments for financial position, growth, market, profitability and other factors. The market transaction approach is a valuation technique in which the fair value is calculated based on market prices realized in actual arm's length transactions. The technique consists of undertaking a detailed market analysis of merged and acquired companies that provides a reasonable basis for comparison to us. Valuation ratios, which relate market prices to selected financial statistics derived from comparable companies, are selected and applied to us after consideration of adjustments for financial position, growth, market, profitability and other factors.

Other Intangible Assets—Purchased customer contracts and customer relationships, backlog and technology are amortized primarily using the pattern of benefits method over periods ranging from two to twenty years. Our trademark intangible asset is not amortized, but is tested for impairment on at least an annual basis as of October 31st and more frequently if interim indicators of impairment exist. Our trademark is considered to be impaired if the carrying value exceeds the estimated fair value. We elect the option to assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the estimated fair value of a trademark is less than its carrying amount.

We account for the cost of computer software developed or obtained for internal use in accordance with ASC 350-40, Internal-Use Software. These costs are capitalized on our Consolidated Balance Sheets then amortized on a straight-line basis over a period of five years or another period as may be required.

We account for software development costs related to software products for sale, lease or otherwise marketed in accordance with ASC 985-20, Software - Costs of Software to Be Sold, Leased, or Marketed. For projects fully funded by us, development costs are capitalized from the point of demonstrated technological feasibility until the point in time that the product is available for general release to customers. Once the product is available for general release, capitalized costs are amortized based on units sold or on a straight-line basis over a period of five years or other such shorter period as may be required.

Property and Equipment—Property and equipment is recorded at original cost to us and depreciated on a straight-line basis over the assets’ estimated useful life. Upon sale or retirement, the costs and related accumulated depreciation or amortization are eliminated from the respective accounts and any resulting gain or loss is included in income. Maintenance and repairs are charged to expense as incurred.

Leases—We account for leases in accordance with ASC 842, Leases. We determine whether a contract is or contains a lease at inception. A contract is or contains a lease if the contract conveys the right to control the use of identified property or equipment (an identified asset) for a period of time in exchange for consideration. We have the right to control the use of the identified asset when we have both the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset. In making this determination, we consider all relevant facts and circumstances. We reassess whether a contract is or contains a lease only if the terms and conditions of the contract are changed. We account for lease components and nonlease components associated with a lease as a single lease component. Operating leases are included in Operating lease right of use assets, Operating lease obligations—current and Operating lease obligations—long term on our Consolidated Balance Sheets. Finance leases are included in Property and equipment—net, Other current liabilities and Other long-term liabilities on our Consolidated Balance Sheets.

Our Right of Use (ROU) asset is recognized as the lease obligation, any initial direct costs and any prepaid lease payments, less any lease incentives and favorable/unfavorable lease terms. Our lease obligations are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. Our lease payments consist of amounts relating to the use of the underlying asset during the lease term, specifically fixed payments, payments to be made in optional periods when we are reasonably certain to exercise an option or to terminate the lease and the amounts probable of being owed by us under residual guarantees. Our variable lease payments are excluded in measuring ROU assets and lease obligations because they do not depend on an index or a rate or are not in substance fixed payments. We exclude lease incentives and initial direct costs incurred from our lease payments. Our leases do not provide an implicit rate, instead we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments.

For operating leases, after lease commencement we measure our lease obligation for each period at the present value of any remaining lease payments, discounted by using the rate determined at lease commencement. In our Consolidated Statements of Loss, we recognize a single operating lease expense calculated on a straight-line basis over the remaining lease term. The depreciation of the ROU asset increases each year as a result of the declining lease obligation balance. Variable lease payments are not recognized in the measurement of the lease obligation;

they are recognized in the period in which the related obligation has been incurred.

For finance leases, after lease commencement we measure our lease obligation by using the effective interest rate method. In each period, the lease obligation will be increased to reflect the interest that is accrued on the related lease obligation by using the appropriate discount rate, offset by a decrease in the lease obligation resulting from the periodic lease payments. We recognize the ROU asset at cost, reduced by any accumulated depreciation. The ROU asset is depreciated on a straight-line basis. Together, the interest expense and depreciation expense result in a front-loaded expense profile. We present interest expense and depreciation expense separately on our Consolidated Statements of Loss.

We recognize payments related to short-term leases (less than one year) as expense on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments were incurred.

We do not separate nonlease components from lease components on all classes of underlying assets. Our leases include nonlease components such as common area maintenance, utilities and operating expenses. Our transportation vehicles and equipment leases include a residual value guarantee, which is a guarantee made to the lessor that the value of the underlying asset returned to the lessor at the end of the lease will be at least a specific amount. We sublease some of our real estate space. Sublease income is immaterial and is presented net with the corresponding lease expense.

In our Consolidated Statements of Loss we recognize lease expense within General and administrative expenses or Cost of services depending on the use of the underlying lease. For leases classified as financing, the interest on lease obligations is classified within Interest expense.

Investments—Investments where we have the ability to exercise significant influence, but we do not control, are accounted for under the equity method of accounting and are included in Other assets on our Consolidated Balance Sheets. Significant influence typically exists if we have a 20% to 50% ownership interest in the investee.

Under this method of accounting, our share of the net earnings (losses) of the investee is included in Equity in earnings (losses) of unconsolidated subsidiaries on our Consolidated Statements of Loss.

Investments where we have less than 20% ownership interest in the investee and lack the ability to exercise significant influence are accounted for under ASC 321-10-35, Investments - Equity Securities. Under this topic our investment equals our cost, less impairment, if any. For investments without a readily determinable fair value, we perform a qualitative assessment to determine if any impairment indicator is present. If an indicator is present, we estimate the fair value to determine if the fair value is less than its carrying value. If the fair value is less than its carrying value or if there is an observable price change through a similar security from the same issuer, we would record an impairment.

Debt Issuance Costs and Financing Fees—Debt issuance costs incurred and fees paid to creditors (financing fees) in connection with the issuance of our Term Loan have been recorded as a direct reduction against our Debt— long term and amortized over the life of our Term Loan as a component of Interest expense using the effective interest method. Costs incurred in connection with the issuance of our undrawn Delayed Draw Term Loan and Revolving Credit Facility have been recorded as Prepaid expenses and Other assets and amortized over their life using the straight-line method.

Impairment of Long-Lived Assets—Whenever events or changes in circumstances indicate that the carrying amount of long-lived assets may not be fully recoverable, we evaluate the probability that future undiscounted net cash flows will be less than the carrying amount of the assets. If any impairment were indicated as a result of this review, we would recognize a loss based on the amount by which the carrying amount exceeds the estimated fair value.

Contract Liabilities—We receive advances and milestone payments from our customers on selected contracts that exceed revenue earned to date, resulting in Contract liabilities. Contract liabilities typically are not considered a significant financing component because they are used to meet working capital demands that can be higher in the early stages of a contract and to protect us from the customer failing to adequately complete some or all of its obligations under the contract. Contract liabilities are reported on our Consolidated Balance Sheets on a net contract basis at the end of each reporting period.

Revenue Recognition—In accordance with ASC 606, Revenue from Contracts with Customers, we account for a contract when: both we and the customer approve and commit; our rights and those of the customer are identified and payment terms are identified; the contract has commercial substance; and collectability of consideration is probable. At contract inception, we identify the distinct goods or services promised in the contract, referred to as performance obligations. Then we determine the transaction price for the contract, which is the consideration that we can expect in exchange for the promised goods or services in the contract. The transaction price can be a fixed or variable amount. It is common for our contracts to contain award fees, incentive fees or other provisions that can either increase or decrease the transaction price. These variable amounts generally are awarded upon achievement of certain performance metrics, program milestones or cost targets and can be based upon customer discretion. We estimate variable consideration at the most likely amount to which we expect to be entitled. We include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and historical, current and forecasted information that is reasonably available to us. The transaction price is allocated to each distinct performance obligation using our best estimate of the standalone selling price for each distinct good or service promised in the contract. The primary method used to estimate standalone selling price is the expected cost plus a margin approach, under which we forecast our expected costs of satisfying a performance obligation and then add an appropriate margin for that distinct good or service promised. Revenue is recognized when, or as, the performance obligation is satisfied.

We recognize revenue over time when there is a continuous transfer of control to our customer. For our U.S.

government contracts, this continuous transfer of control to the customer is supported by clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. When control is transferred over time, Revenue is recognized based on the extent of progress towards completion of the performance obligation. Based on the nature of the products and services provided in the contract, we use our judgment to determine if an input measure or output measure best depicts the transfer of control over time. For service contracts, we typically satisfy our performance obligations as services are rendered. We typically use a cost-based input method to measure progress.

Contract costs include labor, material and allocable indirect expenses. Revenue is recognized proportionally as contract costs are incurred plus estimated fees. For time-and-material contracts, we bill the customer per labor hour and per material, and Revenue is recognized in the amount invoiced since the amount corresponds directly to the value of our performance to date. For stand-ready service contracts, a time-elapsed output method is used to measure progress, and Revenue is recognized on a straight-line basis over the term of the contract. If a contract does not meet the criteria for recognizing Revenue over time, we recognize Revenue at a point in time. Revenue is recognized at the point in time when control of the good or service is transferred to our customer. We consider control to transfer when we have a present right to payment and our customer has legal title. Determining a measure of progress and when control transfers requires us to make judgments that affect the timing of when Revenue is recognized. Almost all of our contracts satisfy their performance obligations over time.

Contracts are often modified to account for changes in contract specifications and requirements. Contract modifications impact the contract when the modification either creates a new performance obligation or changes the existing enforceable rights and obligations. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as a cumulative adjustment to Revenue and profit. Furthermore, a significant change in one or more estimates could affect the profitability of our contracts. We recognize adjustments in estimated profit on contracts in the period identified. The impact of adjustments in contract estimates can be reflected in either Revenue or Cost of services on our Consolidated Statements of Loss.

We have an estimate at completion (EAC) process in which management reviews the progress and execution of our performance obligations. As part of this process, management reviews information including, but not limited to, any outstanding key contract matters, progress towards completion and the related program schedule, identified risks and opportunities and the related changes in estimates of revenue and costs. The risks and opportunities include management’s judgment about the ability and cost to achieve the contract milestones and other technical contract requirements. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the availability of materials, the length of time to complete the performance obligation, execution by our subcontractors, the availability and timing of funding from our customer and overhead cost rates, among other variables. A significant change in one or more of these estimates could affect the profitability of our contracts. If, as a part of our EAC process, we determine that the cost to deliver on a contract will exceed the revenue to be earned at the contract level, we estimate the loss and record it in the period in which it is identified.

The following table includes the aggregate impact of adjustments in contract estimates on our Revenue (in thousands):

Successor Predecessor For the year ended For the period For the period

December 31, 2024 December 31, 2023 September 14, 2022 to

December 31, 2022 January 1, 2022 to September 13, 2022

$ 11,830 $ 6,042 $ 2,276 $ (151)

No adjustment on any one contract was material to our consolidated financial statements for the periods presented.

Contract Costs—Contract costs include direct labor, direct materials, overhead and, when applicable, general and administrative expenses. Incremental costs of obtaining a contract that we expect to recover are recognized as deferred contract costs and are amortized on a systematic basis that is consistent with the transfer to the customer of the goods or services. Other incremental costs are expensed when incurred. Costs of fulfilling a contract or anticipated contract that generate or enhance resources that will be used in satisfying future performance obligations and are expected to be recovered, are recognized as deferred contract costs. Our deferred contract costs are amortized on a systematic basis that is consistent with the transfer of the goods or services to the customer. Other costs of fulfilling a contract (costs of wasted materials, labor or other resources to fulfill the contracts that were not reflected in the price of the contract and costs that relate to satisfied performance obligations in the contract) are expensed when incurred.

General and Administrative Expenses—General and administrative expenses include the salaries and wages, plus associated fringe benefits of our employees not performing work directly for customers, and associated facilities costs. Among the functions covered by these costs are corporate business development, bid and proposal, contracts administration, finance and accounting, legal, corporate governance and executive and senior management.

In addition, we include share compensation, as well as depreciation and amortization expenses related to the general and administrative function. We recognize interest related to unrecognized tax benefits within Interest expense and penalties related to unrecognized tax benefits in General and administrative expenses.

We classify indirect costs incurred as Cost of services and General and administrative expenses in the same manner as such costs are defined in our disclosure statements under U.S. Government Cost Accounting Standards.

Depreciation and Amortization Expenses—Furniture and office equipment are depreciated using the straight-line method with estimated useful lives ranging from five to seven years. For assets that are acquired for use by the customer, the fixed asset will be depreciated by a method and estimated useful life that corresponds to the criteria specified by the contract. Leasehold improvements are amortized using the straight-line method over the shorter of the asset's useful life or the term of the lease.

Share Compensation—We account for share compensation in accordance with ASC 718, Compensation - Stock Compensation, which requires the use of a valuation model to calculate the fair value of stock-based awards. We have elected to use the Black-Scholes-Merton pricing model to determine fair value of stock options on the dates of grant for our stock options. The fair value of our time-based stock options is recognized as operating expenses on a straight-line basis over the vesting period of the time-based stock option. The fair value of our performance-based stock options will be recognized upon the execution of a liquidity event. The compensation expense for restricted stock is recognized over the service period and is based on the grant date fair value of the shares. We account for forfeitures as they occur.

Income Taxes—We account for income taxes in accordance with ASC 740, Income Taxes. Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax bases of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year-to-year. In providing for deferred taxes, we consider tax regulations of the jurisdictions in which we operate, estimates of future taxable income and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria. We recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would “more likely than not” sustain the position following an audit. For tax positions meeting the “more likely than not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority.

Comprehensive Income (Loss)—Comprehensive income (loss) consists of two components: Net loss and other comprehensive income (loss), net of tax. Other comprehensive income (loss), net of tax, refers to revenue, expenses, gains, and losses that under generally accepted accounting principles are recorded as an element of Shareholders’ equity but are excluded from Net loss. Our other comprehensive income (loss), net of tax, consists of the deferral of interest on our designated cash flow hedges and foreign currency translation adjustments that result from consolidation of our foreign entities.

Foreign-Currency Translation—All assets and liabilities of foreign subsidiaries are translated into U.S. dollars at fiscal year-end exchange rates. Income and expense items are translated at average monthly exchange rates prevailing during the fiscal year. The resulting translation adjustments are recorded as a component of accumulated other comprehensive income (loss).

Recently Adopted Accounting Standards Updates

Accounting Standards Updates (ASU) adopted during the year ended December 31, 2024 did not have a material impact on our consolidated financial statements.

Recently Issued But Not Yet Adopted ASUs

ASUs effective after December 31, 2024 are not expected to have a material effect on our consolidated financial statements.

3. Business Combinations

Definitive Logic Holdings Corporation (Definitive Logic)—On September 8, 2023, we completed the acquisition of Definitive Logic through an agreement and plan of merger by and among Definitive Logic Holdings Corporation, ManTech International Corporation, Project Starship Merger Sub, Inc. and Shareholder Representative Services, LLC. Definitive Logic is a government services company that provides digital transformation consulting and technology solutions to the Department of Defense, Federal Civilian and other homeland security customers.

Definitive Logic’s capabilities and customers will advance ManTech’s market position as a trusted advisor to the government and drive our high-tech and Artificial Intelligence strategies for growth.

The acquisition was accounted for as a business combination. The results of Definitive Logic's operations have been included in our consolidated financial statements since that date. We funded the acquisition with borrowings under our Credit Agreement.

The purchase price was $198.6 million, which includes a finalized working capital adjustment. The purchase price was allocated to the underlying assets and liabilities based on their estimated fair value at the date of acquisition. The excess of the purchase price over the fair value of assets acquired and liabilities assumed was recorded as goodwill. The purchase price allocation is complete as of December 31, 2024.

In conjunction with the acquisition, certain members of Definitive Logic’s executive management were given the opportunity to reinvest a portion of their proceeds into non-voting common stock of Moose Holdings. The investment in Moose Holdings totaled $26.9 million which was accounted for as Contributions from Parent, Moose Holdings for the year ended December 31, 2023.

Recognition of goodwill is largely attributed to the value paid for Definitive Logic's capabilities, which will broaden our consultative capabilities…