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T-REX Acquisition (TRXA) posts deeper loss and warns on going concern

Filing Impact
(Moderate)
Filing Sentiment
(Neutral)
Form Type
10-Q

Rhea-AI Filing Summary

T-REX Acquisition Corp. reports a small Bitcoin-focused business with significant financial strain for the six months ended December 31, 2025. Revenue was only $11,389, almost entirely from Bitcoin mining, while the net loss reached $1,410,116, widening from the prior-year period. Operating expenses of over $1.2M and interest and derivative losses drove results.

Total assets were $680,255 against liabilities of $2,113,292, leaving stockholders’ deficit at $1,433,037. Cash was just $1,759, with a working capital deficit of $2,100,806 and an accumulated deficit of $10,969,465. The company disclosed a going concern warning, noting substantial doubt about its ability to continue without new capital.

Debt and derivatives are heavy: notes payable to unrelated parties totaled $555,395 (net $436,120 after discount), related-party notes were $364,366, and the derivative liability tied to convertible features jumped to $433,864 from $34,597. The Orofino, Idaho data center is encumbered by a first-lien note of $307,688 that is in default, with foreclosure proceedings initiated, plus a second-lien related-party note of $207,630. Management plans to pursue additional funding to support its Bitcoin mining, hosting, and emerging software and modular infrastructure segments.

Positive

  • None.

Negative

  • Going concern risk: The company reported a net loss of $1,410,116, cash of $1,759, a working capital deficit of $2,100,806, and a stockholders’ deficit of $1,433,037, and explicitly raised substantial doubt about its ability to continue as a going concern.
  • Debt, default, and derivative overhang: Total liabilities were $2,113,292, including $555,395 of unrelated notes, $364,366 of related-party notes, a $433,864 derivative liability, and a $307,688 first-lien mortgage on the Orofino facility that is in default with foreclosure proceedings initiated.

Insights

Deep losses, minimal cash, and a defaulted mortgage drive high financial risk.

T-REX Acquisition generated only $11,389 of revenue over six months while posting a net loss of $1,410,116. Cash was just $1,759 and working capital deficit reached $2,100,806, leaving a stockholders’ deficit of $1,433,037.

Leverage and structural risk are elevated. Notes payable to unrelated lenders totaled $555,395 (net $436,120 after discounts), related-party notes were $364,366, and the derivative liability tied to convertibles surged to $433,864 from $34,597. Interest expense and fair-value changes further pressure results.

The Orofino, Idaho facility is critical but fragile: a senior note of $307,688 is in default with a Notice of Default and foreclosure proceedings filed, while a $207,630 related-party note is secured by a junior lien. The explicit going concern warning underscores that continued operation depends on successfully raising capital and stabilizing operations.

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

☒ QUARTERLY REPORT DATED DECEMBER 31, 2025, REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

 

For the six months ended December 31, 2025

 

or

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

 

For the transition period from _________ to _________

 

Commission File Number: 000-56528

 

T-REX Acquisition Corp.

(Exact name of registrant as specified in its charter)

 

Nevada

26-1754034

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer

Identification No.)

 

151 N. Nob Hill Road Suite 402

Plantation, FL

33324-1708

(Address of principal executive offices)

(Zip Code)

 

(954) 960-7100

(Registrant’s Telephone Number, Including Area Code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes    ☐ No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes    ☐ No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒

Smaller reporting company

☒

 

 

Emerging Growth Company

☐

 

If an emerging growth company indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes    No ☒

 

As of February 23, 2026, there were 27,154,508 shares of the Registrant’s $0.0001 par value common stock issued and outstanding.

 

Securities registered under Section 12(g) of the Act:

 

Title of each class registered:

Common

 

 

 

 

 

T-REX ACQUISITION CORP. 

CONSOLIDATED STATEMENTS OF OPERATIONS 

(A Nevada Corporation)

 

TABLE OF CONTENTS

 

 

 

 

Page

 

PART I. FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

ITEM 1.

CONSOLIDATED FINANCIAL STATEMENTS

 

F-1

 

 

 

 

 

 

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

3

 

 

 

 

 

 

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

6

 

 

 

 

 

 

ITEM 4.

CONTROLS AND PROCEDURES

 

6

 

 

 

 

 

 

PART II. OTHER INFORMATION

 

 

 

 

 

 

 

 

ITEM 1.

LEGAL PROCEEDINGS

 

8

 

 

 

 

 

 

ITEM 1A.

RISK FACTORS

 

8

 

 

 

 

 

 

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

8

 

 

 

 

 

 

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

 

9

 

 

 

 

 

 

ITEM 4.

MINE SAFETY DISCLOSURES

 

9

 

 

 

 

 

 

ITEM 5.

OTHER INFORMATION

 

9

 

 

 

 

 

 

ITEM 6.

EXHIBITS

 

10

 

 

 
2

Table of Contents

  

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

T-REX ACQUISITION CORP.

December 31, 2025

 

Consolidated Balance Sheets

 

F-2

 

Consolidated Statements of Operations

 

F-3

 

Consolidated Statements of Stockholders’ Equity

 

F-4

 

Consolidated Statements of Cash Flows

 

F-5

 

Notes to the Consolidated Financial Statements

 

F-6

 

 

 
F-1

Table of Contents

  

TREX ACQUISITION CORP.

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

December 31, 2025

 

 

June 30, 2025

 

ASSETS

 

(Unaudited)

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

Cash & cash equivalents

 

$1,759

 

 

$49,733

 

Bitcoin held

 

 

250

 

 

 

17,502

 

Prepaid expense

 

 

10,477

 

 

 

14,997

 

TOTAL CURRENT ASSETS

 

 

12,486

 

 

 

82,232

 

 

 

 

 

 

 

 

 

 

NON-CURRENT ASSETS:

 

 

 

 

 

 

 

 

Plant and equipment, net

 

 

582,573

 

 

 

588,361

 

Other assets

 

 

85,196

 

 

 

77,069

 

TOTAL NON-CURRENT ASSETS

 

 

667,769

 

 

 

665,430

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$680,255

 

 

$747,662

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$79,192

 

 

$56,095

 

Due to related party- accrued compensation

 

 

708,941

 

 

 

508,163

 

Due to related party- advances

 

 

19,256

 

 

 

5,150

 

Note payable, net of debt discount - unrelated parties

 

 

436,120

 

 

 

401,780

 

Interest payable - unrelated parties

 

 

43,525

 

 

 

12,997

 

Notes payable - related parties

 

 

364,366

 

 

 

304,366

 

Interest payable - related parties

 

 

28,028

 

 

 

9,391

 

Derivative liability

 

 

433,864

 

 

 

34,597

 

TOTAL CURRENT LIABILITIES

 

 

2,113,292

 

 

 

1,332,539

 

NON-CURRENT LIABILITIES:

 

 

 

 

 

 

 

 

Stock subscription payable (liability)

 

$-

 

 

 

504,310

 

TOTAL NON CURRENT LIABILITIES

 

 

-

 

 

 

504,310

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

 

2,113,292

 

 

 

1,836,849

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies (Note 10)

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY (DEFICIT)

 

 

 

 

 

 

 

 

Common stock, 0.0001 par value, authorized 350,000,000 shares and 27,154,508 and 25,067,479 issued and outstanding as of December 31, 2025, and June 30, 2025, respectively

 

$2,715

 

 

$2,506

 

Series A Preferred stock, 0.001 par value, authorized 10,000 shares and 2,475 and 0 issued and outstanding as of December 31, 2025, and June 30, 2025., respectively

 

 

2

 

 

 

-

 

Additional paid in capital

 

 

9,853,732

 

 

 

8,175,305

 

Deferred Stock Compensation (Contra Equity)

 

 

(320,021)

 

 

(26,666)

Stock subscription payable

 

 

-

 

 

 

319,018

 

Accumulated deficit

 

 

(10,969,465)

 

 

(9,559,350)

TOTAL STOCKHOLDERS' EQUITY (DEFICIT)

 

 

(1,433,037)

 

 

(1,089,187)

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

 

$680,255

 

 

$747,662

 

 

The accompanying footnotes are an integral part of these consolidated financial statements.

 

 
F-2

Table of Contents

 

T-REX ACQUISITION CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

for the three and six months ended December 31,

(Unaudited)

 

 

 

Three months ended

 

 

Six months ended

 

 

 

2025

 

 

2024

 

 

2025

 

 

2024

 

REVENUE

 

 

 

 

 

 

 

 

 

 

 

 

Mining revenue

 

$2,240

 

 

$-

 

 

$10,163

 

 

$-

 

Realized gain (loss) on bitcoin held

 

 

(109)

 

 

-

 

 

 

1,226

 

 

 

-

 

Total revenues

 

 

2,131

 

 

 

-

 

 

 

11,389

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & amortization

 

$9,469

 

 

 

-

 

 

$18,117

 

 

 

-

 

Electricity

 

 

14,272

 

 

 

-

 

 

 

34,696

 

 

 

-

 

Contract labor

 

 

12,500

 

 

 

-

 

 

 

23,300

 

 

 

-

 

Repairs and Maintenance

 

 

10,000

 

 

 

-

 

 

 

32,056

 

 

 

-

 

Total cost of goods sold

 

 

46,241

 

 

 

-

 

 

 

108,169

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Loss

 

 

(44,110)

 

 

-

 

 

 

(96,780)

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transfer agent and filing fees

 

$14,563

 

 

$3,234

 

 

$19,673

 

 

$22,876

 

Professional fees

 

 

38,215

 

 

 

16,620

 

 

 

126,465

 

 

 

52,503

 

Management and consulting fees

 

 

183,251

 

 

 

154,752

 

 

 

564,202

 

 

 

309,503

 

Share based compensation

 

 

70,836

 

 

 

74,858

 

 

 

86,671

 

 

 

149,716

 

Administration fees

 

 

342,891

 

 

 

70,724

 

 

 

405,533

 

 

 

86,151

 

Total operating expenses

 

 

649,756

 

 

 

320,188

 

 

 

1,202,544

 

 

 

620,749

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from Operations

 

 

(693,866)

 

 

(320,188)

 

 

(1,299,324)

 

 

(620,749)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

$(35,003)

 

$(11,865)

 

$(60,773)

 

$(23,119)

Insurance claim

 

 

63,434

 

 

 

 

 

 

 

63,434

 

 

 

 

 

Gain (loss) on derivative liabilities

 

 

(90,467)

 

 

(85,374)

 

 

(121,580)

 

 

(85,374)

Capital Credits

 

 

-

 

 

 

-

 

 

 

8,127

 

 

 

-

 

Total other income (expense)

 

 

(62,036)

 

 

(97,239)

 

 

(110,792)

 

 

(108,493)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss Before Income Taxes

 

 

(755,902)

 

 

(417,427)

 

 

(1,410,116)

 

 

(729,242)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Provision for Income Taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$(755,902)

 

$(417,427)

 

$(1,410,116)

 

$(729,242)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and Dilutive Net Loss Per Share

 

$(0.03)

 

$(0.02)

 

$(0.05)

 

$(0.02)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and Dilutive - Weighted average number of common shares outstanding

 

 

26,628,657

 

 

 

18,223,953

 

 

 

25,864,398

 

 

 

18,223,953

 

 

The accompanying footnotes are an integral part of these consolidated financial statements.

 

 
F-3

Table of Contents

 

T-REX ACQUISITION CORP.

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

As of December 31, 2025

(Unaudited)

 

 

 

Common Stock at Par $0.0001

 

 

Preferred Stock at Par $0.001

 

 

Additional Paid in  

 

 

 Deferred Stock Compensation

 

 

Stock Subscription 

 

 

Accumulated

 

 

 

 

 

 

Number of Shares

 

 

Amount

 

 

Number of Shares

 

 

Amount

 

 

Capital

 

 

(Contra Equity)

 

 

 Payable

 

 

Deficit

 

 

TOTAL

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance June 30, 2024

 

 

18,223,953

 

 

$1,822

 

 

 

-

 

 

$-

 

 

$5,899,164

 

 

 

 

 

$15,200

 

 

$(7,023,798 )

 

$(1,107,612 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued for cash

 

 

1,290,000

 

 

 

129

 

 

 

 

 

 

 

 

 

 

 

849,871

 

 

 

 

 

 

 

 

 

 

 

 

 

 

850,000

 

Shares issued for purchase of intangible asset

 

 

600,000

 

 

 

60

 

 

 

 

 

 

 

 

 

 

 

199,940

 

 

 

 

 

 

 

 

 

 

 

 

 

 

200,000

 

Shares issued as incentives to note payable agreements - unrelated parties

 

 

329,905

 

 

 

33

 

 

 

 

 

 

 

 

 

 

 

98,178

 

 

 

 

 

 

(24,445 )

 

 

 

 

 

 

73,766

 

Shares issued as incentives for note payable agreements - related parties

 

 

477,011

 

 

 

48

 

 

 

 

 

 

 

 

 

 

 

208,503

 

 

 

 

 

 

-

 

 

 

 

 

 

 

208,550

 

Shares issued for redemption of warrants

 

 

2,464,706

 

 

 

246

 

 

 

 

 

 

 

 

 

 

 

13,719

 

 

 

 

 

 

-

 

 

 

 

 

 

 

13,965

 

Shares issued for note payable conversion

 

 

247,307

 

 

 

25

 

 

 

 

 

 

 

 

 

 

 

135,791

 

 

 

 

 

 

-

 

 

 

 

 

 

 

135,816

 

Shares issued for services

 

 

1,434,597

 

 

 

143

 

 

 

 

 

 

 

 

 

 

 

455,318

 

 

 

 

 

 

 

 

 

 

 

 

 

 

455,462

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share issuance obligation for conversion of note payable

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

50,417

 

 

 

 

 

 

 

50,417

 

Share issuance obligation for services provided

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,845

 

 

 

 

 

 

 

10,845

 

Shares issuance obligation for note payable incentives - related parties

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

253,036

 

 

 

 

 

 

 

253,036

 

Share issuance obligation for exercised warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13,965

 

 

 

 

 

 

 

13,965

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Warrants issued as noteholder incentives

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

180,271

 

 

 

 

 

 

-

 

 

 

 

 

 

 

180,271

 

Warrants issued as share-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

134,549

 

 

 

 

 

 

 

 

 

 

 

 

 

 

134,549

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Net Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,535,552 )

 

 

(2,535,552 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance June 30, 2025

 

 

25,067,479

 

 

$2,506

 

 

 

-

 

 

$-

 

 

$8,175,305

 

 

 

 

 

$319,018

 

 

$(9,559,350 )

 

$(1,062,521 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued for note payable cancellation

 

 

 

 

 

 

 

 

 

 

2,475

 

 

 

2

 

 

 

504,307

 

 

 

 

 

 

 

 

 

 

 

 

 

 

504,310

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share issuance obligation for conversion of note payable - related parties

 

 

201,396

 

 

 

20

 

 

 

 

 

 

 

 

 

 

 

50,397

 

 

 

 

 

 

(50,417 )

 

 

 

 

 

 

-

 

Shares issuance obligation for note payable incentives - related parties

 

 

431,657

 

 

 

43

 

 

 

 

 

 

 

 

 

 

 

254,593

 

 

 

 

 

 

(254,636 )

 

 

 

 

 

 

-

 

Share issuance obligation for exercised warrants

 

 

28,500

 

 

 

3

 

 

 

 

 

 

 

 

 

 

 

13,962

 

 

 

 

 

 

(13,965 )

 

 

 

 

 

 

-

 

Shares issued as stock-based compensation

 

 

250,000

 

 

 

25

 

 

 

 

 

 

 

 

 

 

 

150,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

150,025

 

Shares issued as incentives to note payable agreements - unrelated parties

 

 

100,000

 

 

 

10

 

 

 

 

 

 

 

 

 

 

 

59,990

 

 

 

 

 

 

 

 

 

 

 

 

 

 

60,000

 

Shares issued for services

 

 

432,000

 

 

 

43

 

 

 

 

 

 

 

 

 

 

 

259,156

 

 

 

 

 

 

 

 

 

 

 

 

 

 

259,199

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(654,214 )

 

 

(654,214 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance September 30, 2025

 

 

26,511,032

 

 

$2,650

 

 

 

2,475

 

 

$2

 

 

$9,467,710

 

 

$-

 

 

$(0 )

 

$(10,213,563 )

 

$(743,200 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued as incentives to note payable agreements - unrelated parties

 

 

251,809

 

 

 

25

 

 

 

-

 

 

 

-

 

 

 

151,060

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

151,086

 

Shares issued as stock-based compensation

 

 

341,667

 

 

 

34

 

 

 

-

 

 

 

-

 

 

 

204,966

 

 

 

(150,000 )

 

 

-

 

 

 

 

 

 

 

55,000

 

Shares issued for services

 

 

50,000

 

 

 

5

 

 

 

-

 

 

 

-

 

 

 

29,995

 

 

 

(25,000 )

 

 

-

 

 

 

 

 

 

 

5,000

 

Reclassification of prepaid consulting to deferred stock-based compensation (ASC 718)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(145,021 )

 

 

-

 

 

 

 

 

 

 

(145,021 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(755,902 )

 

 

(755,902 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance December 31, 2025 (Unaudited)

 

 

27,154,508

 

 

$2,715

 

 

 

2,475

 

 

$2

 

 

$9,853,732

 

 

$(320,021 )

 

$(0 )

 

$(10,969,465 )

 

$(1,433,037 )

 

 
F-4

Table of Contents

 

TREX ACQUISITION CORP.

 

CONSOLIDATED STATEMENT OF CASH FLOWS

 

for the six months ended December 31, 2025

 

(Unaudited)

 

 

 

 

 

2025

 

 

2024

 

OPERATING ACTIVITIES

 

   Net Income/ (Loss)

 

$(1,410,116)

 

$(729,242)

   Adjustments to reconcile net loss to net cash used in operating activities

 

 

 

 

 

 

 

 

Share based compensation expense

 

 

86,671

 

 

 

149,714

 

Capital credits income recognized

 

 

(8,127)

 

 

-

 

Depreciation & amortization

 

 

18,117

 

 

 

-

 

Consulting services paid in shares

 

 

204,200

 

 

 

-

 

Compensation paid in form of note payable

 

 

60,000

 

 

 

-

 

Loss (Gain) on derivative liability

 

 

121,580

 

 

 

85,374

 

Loan Cost - paid by share issuance

 

 

369,518

 

 

 

11,460

 

Legal costs - paid by share issuance

 

 

60,000

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

(Increase) decrease in assets

 

 

 

 

 

 

 

 

       Bitcoin held

 

 

17,252

 

 

 

 -

 

       Prepaid expense

 

 

4,520

 

 

 

(37,845)

       Other assets

 

 

-

 

 

 

(110,069)

Increase (decrease) in liabilities

 

 

 

 

 

 

 

 

       Accounts payable and accrued expenses

 

 

23,097

 

 

 

21,826

 

       Interest payable to third parties

 

 

30,528

 

 

 

4,872

 

       Interest payable to related parties

 

 

32,481

 

 

 

4,659

 

       Advances payable to related parties

 

 

14,106

 

 

 

(13,602)

       Balances owed to related parties

 

 

200,778

 

 

 

131,524

 

Net cash used in operating activities

 

 

(175,395)

 

 

(481,329)

 

 

 

 

 

 

 

 

 

INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

      Capital expenditures – CIP / Building Improvements 

 

$(12,329)

 

$-

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

(12,329)

 

 

-

 

 

 

 

 

 

 

 

 

 

FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

      Shares issued for cash

 

$-

 

 

$400,000

 

      Repayment of convertible notes

 

 

(5,250)

 

 

 

 

      Proceeds from issuance of note payable - related parties

 

 

-

 

 

 

29,814

 

      Proceeds from issuance of note payable - unrelated parties

 

 

145,000

 

 

 

51,623

 

Net cash provided by financing activities

 

 

139,750

 

 

 

481,437

 

NET INCREASE/(DECREASE) IN CASH

 

 

(47,974)

 

 

108

 

 

 

 

 

 

 

 

 

 

CASH AT BEGINNING OF PERIOD

 

$49,733

 

 

$36

 

 

 

 

 

 

 

 

 

 

CASH AT END OF PERIOD

 

$1,759

 

 

$144

 

 

 

 

 

 

 

 

 

 

Supplemental Cashflow Information

 

 

 

 

 

 

 

 

    Interest Paid

 

$255

 

 

$1,850

 

    Taxes Paid

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Supplemental Non-Cash Investing and Financing Activities

 

 

 

 

 

 

 

 

Issued shares valued at $150,025 as consideration for compensation to CTO.

 

 

150,025

 

 

 

-

 

Issued shares valued at $168,000 as consideration for compensation to Director.

 

 

168,000

 

 

 

-

 

Issued shares valued at $30,000 as consideration for compensation to PR Consultant.

 

 

30,000

 

 

 

-

 

Reclassification of prepaid consulting to deferred stock-based compensation (ASC 718)

 

 

26,666

 

 

 

-

 

Shares issued as inducement for note payable

 

 

323,843

 

 

 

-

 

Shares issued for related party note payable cancellation

 

 

504,310

 

 

 

-

 

Shares issued for the obligation earlier booked

 

 

319,018

 

 

 

-

 

 

The accompanying footnotes are an integral part of these consolidated financial statements.

 

 
F-5

Table of Contents

  

T-REX ACQUISITION CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2025

 

NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS

 

T-REX Acquisition Corp. (“T-REX” or the “Company”) was incorporated on January 16, 2008, in the State of Nevada. From inception through June 2021, the Company sought a business combination, including a reverse merger opportunity. In July 2021, the Company pivoted its strategy to become an emerging technology enterprise, focusing on operations and investments in the cryptocurrency sector, particularly those related to distributed ledger technologies and associated intangible assets.

 

On June 1, 2022, the Company formally changed its name from “TREX Acquisition Corp.” to “T-REX Acquisition Corp.”

 

As of June 30, 2025, the Company is a holding company with the following subsidiaries: Raptor Mining LLC, a Florida limited liability company (“Raptor”); TRXA Merger Sub, Inc., an inactive Delaware corporation (“Merger Sub”), Megalodon Mining and Electric, LLC, a Florida limited liability company (“Megalodon”), Sabretooth Mining Containers, LLC., a Florida limited liability company (“Sabretooth”), and Deinodon, a Florida limited liability company (“Deinodon”).

 

The Company is authorized to issue up to 350,000,000 shares of common stock, par value $0.0001 per share and 20,000,000 preferred stock shares, par value $0.001 per share. Of the authorized preferred stock, 10,000 shares have been designated as Series A Preferred Stock, with the remaining preferred shares undesignated and available for issuance as blank-check preferred stock.

 

Business Focus and Strategy

 

T-REX’s current strategic focus includes securing and operating within the Bitcoin distributed ledger network, as well as exploring additional distributed ledger protocols and infrastructure opportunities. Bitcoin (“BTC”) is a decentralized digital currency operating on a peer-to-peer network called the blockchain, which enables secure, trustless transactions without reliance on a central authority.

 

The Company began earning Bitcoin mining rewards on February 17, 2022, recognizing revenue based on the USD value of the rewards received. T-REX, generally does not retain Bitcoin on its balance sheet and frequently converts received BTC into U.S. dollars or uses it for payments to third parties.

 

The consolidated entity is comprised of T-REX Acquisition Corp. and its wholly owned subsidiaries:

 

 

·

TRXA Merger Sub, Inc. (“Merger Sub”) was formed on March 13, 2020, in the State of Delaware to facilitate a potential acquisition of a Software-as-a-Service (SaaS) business. The subsidiary is currently inactive and has no operations or reportable assets or liabilities.

 

 

 

 

·

Raptor Mining LLC (“Raptor”) was formed on July 9, 202,1 in the state of Florida, Raptor’s operations include the Company’s proprietary Bitcoin mining operations and virtual asset acquisitions. Raptor conducts the Company’s primary cryptocurrency mining activities. Raptor is responsible for validating blockchain transactions in exchange for mining rewards and also engages in the acquisition of virtual assets.

 

 

 

 

·

Megalodon Mining and Electric LLC (“Megalodon”) was formed on July 1, 2022, in the State of Florida, to evaluate, acquire and develop data centers to fulfil its cryptocurrency hosting business model. On March 4, 2025, Megalodon acquired a data center and co-location facility in Orofino, Idaho. The co-location hosting business model offers third party crypto miners support to operate mining operations without purchasing a facility of their own. For a monthly fee, the Company offers lower cost electricity and operational support staff.

 

 

 

 

·

Sabretooth Mining Containers LLC (“Sabretooth”) was formed on February 7, 2025, in the state of Florida to design and fabricate modular containers equipped with electrical and racking infrastructure to support off-site cryptocurrency mining operations.

 

 

 

 

·

Deinodon Mining Solutions LLC (“Deinodon”) was formed on March 29, 2025, in the state of Florida and provides software and technical resources for cryptocurrency operations. On March 31, 2025, Deinodon acquired the assets of Baoblock, Inc. for $210,000, paid by the issuance of 600,000 shares of T-REX common stock shares and $10,000 in cash. The seller, Baoblock, Inc., is owned by the Company’s newly appointed Chief Technology Officer. The acquisition includes proprietary software and technical expertise. The software’s developer is the Company’s Chief Technical Officer, who has the ability to maintain and modify support operations as needed. Substantiation of its fair value for reporting purposes was deemed to have more cost than benefit and it was therefore impaired to a value of $0.

 

All intercompany transactions and balances have been eliminated in consolidation.

 

 
F-6

Table of Contents

 

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America of ("U.S. GAAP") as found in the Accounting Standards Codification ("ASC”), and the Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB") and are expressed in US Dollars. The consolidated financial statements should be read in conjunction with the notes contained herein as part of the Company's quarterly filing in its Form 10-Q filing under the Securities Exchange Commission.

 

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

   

Reclassification

 

Certain reclassifications have been made to prior periods to conform with current reporting.

 

Principles of Consolidation

 

As of December 31, 2025, the accounts include those of the Company and its 100% owned subsidiaries, T-REX Merger Sub, Raptor Mining LLC Megalodon Mining and Electric LLC, Sabretooth Mining Containers LLC and Deinodon Mining Solutions, LLC. All intercompany transactions have been eliminated.

 

Business segments

 

The Company follows ASC 280, Segment Reporting, in identifying, reporting, and measuring its operating segments. Segment information reflects information the financial data utilized by the Chief Operating Decision Maker (“CODM”) in assessing performances and allocating resources. The accounting principles applied to develop segments results are consistent with those used in the preparation of the Company’s consolidated financial statement. Intercompany transactions and balances are eliminated in consolidation, and expenses that are not directly attributable to a specific segment are recorded within the Holding segment unless otherwise supported.

 

The Company uses the “management approach” to identify its reportable segments. This approach is based on the internal organizational structure used by management for making operational decisions and assessing the performance of the business. Under this approach, the Company has determined that it operates through four reportable segments.

 

The Holding segment, represented by T-Rex Acquisition Corp., seeks business opportunities to sustain and expand operations. This segment serves as the primary source of financing for the Company, and all major corporate expenses are processed through it. The Mining segment includes the Company’s bitcoin mining operations. The Company holds the mining-related assets and generates revenue through the receipt of Bitcoin rewards earned from mining activities. The Hosting segment generates revenue by providing third-party hosting services at the Company’s Orofino facility. This segment holds the assets related to the facility and incurs all associated operational expenses. The Software Services segment consists of the entity that focuses on operations and services that can be achieved with state-of-the-art software platform for its industry. The Company plans to utilize this platform to support future business initiatives.

 

 
F-7

Table of Contents

     

 

Segmented Information- Statements of Operations

 

 

 

 

 

 

 

 

 

2026

 

Holding Segment

 

 

Mining Segment

 

 

Hosting Segment

 

 

Software Services Segment

 

 

Total

 

Revenue and other income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mining revenue

 

$-

 

 

$10,163

 

 

$-

 

 

$-

 

 

$10,163

 

Realized gain (loss) on sale/exchange of bitcoin

 

 

-

 

 

 

1,226

 

 

 

-

 

 

 

-

 

 

 

1,226

 

Hosting revenue

 

 

-

 

 

 

-

 

 

 

5,000

 

 

 

-

 

 

 

5,000

 

Capital Credits

 

 

-

 

 

 

-

 

 

 

8,127

 

 

 

-

 

 

 

8,127

 

Insurance claim received

 

 

-

 

 

 

-

 

 

 

63,434

 

 

 

 

 

 

 

63,434

 

Intersegment sales revenue

 

 

-

 

 

 

-

 

 

 

(5,000)

 

 

-

 

 

 

(5,000)

 

 

 

-

 

 

 

11,389

 

 

 

71,561

 

 

 

-

 

 

 

82,950

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

$32

 

 

$5,000

 

 

$90,020

 

 

$-

 

 

$95,052

 

Depreciation and Amortization

 

 

-

 

 

 

102

 

 

 

18,014

 

 

 

-

 

 

 

18,117

 

Transfer agent and filing fees

 

 

19,673

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

19,673

 

Professional fees

 

 

126,465

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

126,465

 

Management and consulting fees

 

 

504,202

 

 

 

-

 

 

 

60,000

 

 

 

-

 

 

 

564,202

 

Share based compensation

 

 

86,671

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

86,671

 

Administration Fees

 

 

386,973

 

 

 

47

 

 

 

18,513

 

 

 

-

 

 

 

405,533

 

Interest expense

 

 

20,177

 

 

 

-

 

 

 

40,596

 

 

 

-

 

 

 

60,773

 

Gain (Loss) on derivative liabilities

 

 

121,580

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

121,580

 

Intersegment Expenses

 

 

 

 

 

 

 

 

 

 

(5,000)

 

 

-

 

 

 

(5,000)

Net Income (loss) before income

 

$(1,265,773)

 

$6,240

 

 

$(150,582)

 

$-

 

 

$(1,410,116)

 taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segmented Information- Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2026

 

Holding Segment

 

 

Mining Segment

 

 

Hosting Segment

 

 

Software Services Segment

 

 

Total

 

Total assets

 

$1,010,362

 

 

$120,895

 

 

$652,058

 

 

$(225)

 

$1,783,089

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: intersegment eliminations

 

 

(892,442)

 

 

(45,164)

 

 

(165,228)

 

 

 

 

 

 

(1,102,834)

Total assets

 

$117,920

 

 

$75,731

 

 

$486,830

 

 

$(225)

 

$680,255

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

$1,369,738

 

 

$719,095

 

 

$917,393

 

 

$209,900

 

 

$3,216,126

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Less: intersegment eliminations

 

 

(151,441)

 

 

(598,324)

 

 

(143,069)

 

 

(210,000)

 

 

(1,102,834)

Total liabilities

 

$1,218,297

 

 

$120,772

 

 

$774,324

 

 

$(100)

 

$2,113,292

 

   

 
F-8

Table of Contents

 

 

Segmented Information- Statements of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

2025

 

Holding Segment

 

 

Mining Segment

 

 

Hosting Segment

 

 

Software Services Segment

 

 

Total

 

Revenue and other income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mining revenue

 

$-

 

 

$15,701

 

 

$-

 

 

$-

 

 

$15,701

 

Realized gain (loss) on sale/exchange of bitcoin

 

 

-

 

 

 

1,801

 

 

 

-

 

 

 

-

 

 

 

1,801

 

Hosting revenue

 

 

-

 

 

 

-

 

 

 

51,909

 

 

 

-

 

 

 

51,909

 

Intersegment sales revenue

 

 

-

 

 

 

-

 

 

 

(37,021)

 

 

-

 

 

 

(37,021)

 

 

 

-

 

 

 

17,502

 

 

 

14,888

 

 

 

-

 

 

 

32,390

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

$-

 

 

$37,021

 

 

$67,930

 

 

$-

 

 

$104,952

 

Depreciation and Amortization

 

 

-

 

 

 

22,700

 

 

 

10,462

 

 

 

17,500

 

 

 

50,662

 

Loss on impairment of intangible asset (software)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

192,500

 

 

 

192,500

 

Transfer agent and filing fees

 

 

24,383

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

24,383

 

Professional fees

 

 

197,370

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

197,370

 

Management and consulting fees

 

 

674,255

 

 

 

-

 

 

 

20,000

 

 

 

-

 

 

 

694,255

 

Share based compensation

 

 

322,547

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

322,547

 

Administration Fees

 

 

773,053

 

 

 

8,168

 

 

 

9,286

 

 

 

125

 

 

 

790,632

 

Interest expense

 

 

49,206

 

 

 

-

 

 

 

58,983

 

 

 

-

 

 

 

108,190

 

Gain (Loss) on derivative liabilities

 

 

119,471

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

119,471

 

Intersegment Expenses

 

 

-

 

 

 

-

 

 

 

(37,021)

 

 

-

 

 

 

(37,021)

Net Income (loss) before income

 

$(2,160,285)

 

$(50,387)

 

$(114,754)

 

$(210,125)

 

$(2,535,552)

 taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segmented Information- Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2025

 

Holding Segment

 

 

Mining Segment

 

 

Hosting Segment

 

 

Software Services Segment

 

 

Total

 

Total assets

 

$1,039,935

 

 

$109,553

 

 

$718,887

 

 

$(125)

 

$1,868,249

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: intersegment eliminations

 

 

(886,569)

 

 

(45,164)

 

 

(162,188)

 

 

-

 

 

 

(1,093,921)

Total assets

 

$153,366

 

 

$64,389

 

 

$556,699

 

 

$(125)

 

$774,328

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

$1,173,107

 

 

$713,993

 

 

$833,670

 

 

$210,000

 

 

$2,930,770

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Less: intersegment eliminations

 

 

(147,631)

 

 

(593,221)

 

 

(143,069)

 

 

(210,000)

 

 

(1,093,921)

Total liabilities

 

$1,025,476

 

 

$120,772

 

 

$690,601

 

 

$-

 

 

$1,836,849

 

 

Use of estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include the estimated useful lives of property and equipment. Actual results could differ from those estimates.

 

 
F-9

Table of Contents

 

 

Cash and cash equivalents

 

Cash and cash equivalents include short-term, highly liquid investments, such as cash on account with commercial banks, certificates of deposit or money market funds that are readily convertible to known amounts of cash and have original maturities of three months or less. All cash balances are held by major banking institutions.

 

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

   

Prepaid Expenses

 

Prepaid Expenses are primarily governed by ASC 340-10-25 (Other Assets and Deferred Costs- Recognition.) In accordance with this standard, payments made by the Company in cash or other forms of consideration for goods or services not yet received are classified as prepaid expenses.

 

Fair value of financial instruments

 

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S.) GAAP and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

 

Level 1

Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

 

Level 2

Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

 

Level 3

Pricing inputs that are generally unobservable inputs and not corroborated by market data.

      

Fair Value Measurements as of December 31, 2025

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Bitcoin held

 

$250

 

 

$-

 

 

$-

 

 

$250

 

 

 

$250

 

 

$-

 

 

$-

 

 

$250

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability

 

$-

 

 

$-

 

 

$433,864

 

 

 

433,864

 

 

 

$-

 

 

$-

 

 

$433,864

 

 

$433,864

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements as of June 30, 2025

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bitcoin held

 

$17,502

 

 

$-

 

 

$-

 

 

$17,502

 

 

 

$17,502

 

 

$-

 

 

$-

 

 

$17,502

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative liability

 

$-

 

 

$-

 

 

$34,597

 

 

$34,597

 

 

 

$-

 

 

$-

 

 

$34,597

 

 

$34,597

 

 

 
F-10

Table of Contents

                            

 

The Carrying amount of the Company’s financial assets and liabilities, such as cash and accrued expenses, approximate their fair value because of the short maturity of those instruments.

 

Disaggregated Revenue Disclosure

 

The Company’s customers or sources of revenue generation were only in Idaho, United States during the period ended December 31, 2025. Below is a table of revenue by type:

 

 

 

For the period ended

 

Revenue Type

 

December 31, 2025

 

 

June 30, 2025

 

Mining Revenue

 

$10,163

 

 

$15,701

 

Hosting Revenue

 

 

-

 

 

 

14,888

 

Realized Gain or Loss on Bitcoin Held

 

 

1,226

 

 

 

1,801

 

Total revenue

 

$11,389

 

 

$32,390

 

 

Digital Currencies – Bitcoin

 

The Company accounts for digital assets in accordance with the AICPA Practice Aid “Accounting for and Auditing of Digital Assets” (June 30, 2022) and SEC Staff Accounting Bulletin No. 121, which provide non-authoritative guidance under U.S. GAAP. There is currently no specific authoritative guidance on accounting for digital assets; therefore, digital assets that lack physical substance meet the definition of intangible assets and are accounted for under FASB ASC 350, Intangibles – Goodwill and Other.

 

Effective June 30, 2024, the Company early adopted FASB ASU 2023-08, “Accounting for and Disclosure of Crypto Assets.” This standard requires that qualifying crypto assets, including Bitcoin, be measured at fair value under ASC 820, with changes in fair value recognized in net income each reporting period, replacing the previous impairment model.

 

The Bitcoin mining reward reduces by 50% (“halving”) approximately every four years or after 210,000 blocks are mined. The most recent halving occurred on April 19, 2024, reducing the block reward from 6.25 BTC to 3.125 BTC.

 

The Company held no digital assets as of December 31, 2025. As of June 30, 2025, the Company held Bitcoin with a fair value of $250, which also represents its carrying amount. Fair value is determined using quoted prices in active markets (Level 1 input).

 

Plant and equipment - Crypto-currency machines

 

The rate at which the Company generates digital assets, and therefore consumes the economic benefits of its mining equipment, is influenced by several factors, including:

 

 

·

the complexity of the transaction verification process, driven by algorithms contained within the Bitcoin open-source protocol;

 

 

 

 

·

the general availability of global computer processing capacity (the Bitcoin network’s total hash rate); and

 

 

 

 

·

technological obsolescence caused by rapid advancements in mining hardware, with newer-generation models typically offering higher efficiency and lower operating costs.

 

The Company operates in an emerging industry with limited historical data to support estimates of the useful economic lives of specialized mining equipment. Mining equipment may become obsolete more rapidly than traditional equipment due to ongoing technological development and efficiency improvements. Plant and equipment, consisting primarily of mining equipment, are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets.

 

Prior to fiscal year 2023, the Company used an estimated useful life of seven years for its mining machines. During the fiscal year ended June 30, 2023, management reassessed the useful life to one year, consistent with prevailing industry research and the rapid evolution of Bitcoin mining hardware. The revised useful life was applied prospectively beginning July 1, 2023. Management evaluates this estimate annually and will revise it as updated information becomes available.

 

In March 2025, the Company purchased its first datacenter/co-location facility in Orofino, Idaho. Of the $500,000 purchase price, approximately $22,700 was allocated to ASIC miners based on prevailing secondary-market pricing per tera hash. These miners were assigned a one-year useful life in accordance with the Company’s depreciation policy and were fully depreciated as of June 30, 2025.

 

 

 
F-11

Table of Contents

 

 

Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If impairment indicators are present, the Company compares the estimated future undiscounted cash flows expected to be generated by the asset group to its carrying value. If the carrying value exceeds the undiscounted cash flows, the asset is written down to fair value, and the resulting impairment loss is recognized in the condensed consolidated statements of operations.

 

Revenue Recognition

 

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. The core principle of the new revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The Company applies the following five-step model to all revenue streams within the scope of ASC 606:

  

Cryptocurrency Mining Revenue

 

Crypto asset transaction verification is the output generated from the Company's ordinary activities under its mining pool contract. The consideration the Company receives is a bitcoin reward, which the Company measures at fair value on the date awarded. Rewards are earned when the Company successfully places a block (by being the first to solve an algorithm). As a result, the Company receives confirmation from the mining pool of the block placed and rewards earned. The Company uses the quoted price of the bitcoin at closing, on the date the coin is mined to value its reward/s. There is no significant financing component in these transactions. Expenses associated with running the digital currency mining business, such as rent, mining equipment depreciation, and electricity costs are also recorded as cost of revenue.

 

The fair value of Bitcoin received is determined using the closing U.S. dollar spot rate of Bitcoin on the grant date of the reward.

 

Subsequent to the Bitcoin reward being granted. Bitcoin is measured and held at its fair market value in accordance with ASC 350-60 and ASC 820, and any changes in fair value are recorded in the statement of operations as unrealized gains or losses. Upon the sale or exchange of Bitcoin, the difference between the carrying amount and the proceeds received is recognized as a realized gain or loss.

 

The Company applies the ASC 606 model as follows:

 

 

·

Step 1: Contract/s are established via written service agreements with the mining pool.

 

·

Step 2: The primary performance obligation is to continuously perform calculations using mining equipment to solve algorithms and add blocks to the Bitcoin block chain network.

 

·

Step 3: The transaction price is the agreed number of Bitcoin awarded based on the mining pool agreement.

 

·

Step 4: The allocation of the transaction price is not applicable as it fully relates to the mining of Bitcoin, which is a single performance obligation.

 

·

Step 5: Revenue is recognized upon verification of transactions/ solving an algorithm and adding the blocks to the Bitcoin block chain network.

 

Co-location Hosting Revenue

 

The Company provides co-location hosting services to third-party customers, primarily digital asset mining businesses, through the provision of physical space and supporting infrastructure within its mining facility. These services generally include the allocation of rack space for customer-owned mining equipment, delivery of electrical power, internet connectivity, facility cooling, physical security, and basic operational support such as equipment monitoring and maintenance. The Company’s facilities are designed to support the high power and uptime requirements typical of cryptocurrency mining operations.

 

Revenue from these services is recognized over time, as the performance obligation (continuous hosting access) is satisfied. Customers typically prepay a fixed estimated fee at the beginning of each month for that month’s services; charge adjustments and credits are applied at the end of each month based on actual charges. The hosting fee is determined based on the estimated miner’s kilowatt hours and period of use.

  

 
F-12

Table of Contents

 

 

The Company applies the ASC 606 model as follows:

 

 

·

Step 1: Contracts are established via written service agreements.

 

·

Step 2: The primary performance obligation is continuous provision of hosting services.

 

·

Step 3: The transaction price is a single charge of kilowatt hours over time.

 

·

Step 4: The full transaction price is allocated to the hosting service obligation.

 

·

Step 5: Revenue is recognized ratably over time, using a time-based output method.

 

Software Development and Licensing Revenue

 

Through Deinodon, its subsidiary, the Company expects to generate revenue from the development and licensing of proprietary software used for the remote monitoring and management of physical operations, including real-time temperature tracking of hardware components, operational performance analytics, and predictive maintenance alerts.

 

Modular Infrastructure Sales

 

Through Sabretooth, its subsidiary, the Company expects to generate revenue through the design, fabrication, and sale of modular containers equipped with electrical and racking infrastructure to support off-site cryptocurrency mining operations.

 

Transaction Price Considerations

 

Hosting and Co-Location Services

  

The hosting arrangements, the transaction price generally consists of fixed monthly service fees and variable consideration primarily related to electrical usage.

 

 

·

Variable Consideration: Usage-based power fees represent variable consideration. The Company estimates such amounts using the most likely amount method and includes them in revenue only to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur. Because billing is typically based on actual monthly consumption, estimation uncertainty is generally limited.

 

 

 

 

·

Significant Financing Component: Not applicable. Hosting contracts generally require payment within customary commercial terms and do not include extended payment arrangements that would give rise to a significant financing component.

 

 

 

 

·

Noncash Consideration: Not typical. Hosting services are generally settled in cash.

 

 

 

 

·

Consideration Payable to Customers: The Company does not generally provide rebates or incentives. Any service credits provided under service level arrangements are treated as variable consideration and recorded as reductions of revenue in the period the related services are provided.

 

 

 

 

 

Bitcoin Mining

  

Revenue from proprietary mining represents noncash consideration received in the form of Bitcoin upon successful validation of a block.

 

 

·

Variable Consideration: Such considerations would not typically be applicable as block rewards and transaction fees are protocol-determined and not subject to negotiation or contractual variability with a customer. Not applicable in the traditional ASC 606 context, as block rewards and transaction fees are protocol-determined and not subject to negotiation or contractual variability with a customer.

 

 

 

 

·

Significant Financing Component: This is not applicable for the nature of revenue, as consideration is received contemporaneously with performance.

 

 

 

 

·

Noncash Consideration: Bitcoin received is the only consideration received and is measured at fair value at the time control is obtained.

 

 

 

 

·

Consideration Payable to Customers: The Company does not provide consideration to mining pools or counterparties that would be treated as reduction of revenue.

 

 

 
F-13

Table of Contents

  

 

Stock based compensation.

 

The Company accounts for stock-based compensation in accordance with ASC Section 718 Compensation – Stock Compensation. Under the fair value recognition provisions of ASC 718 stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expensed ratably over the requisite service period/vesting period.

 

The Company accounts for share-based payments issued to non-employees in accordance with ASU 2018-07, Compensation-Stock Compensation (Topic 718). Improvements to Non-employee Share Based Payment Accounting, which requires non-employee awards to be measured at grant date fair value and recognized in a manner consistent with awards granted to employees. Accordingly, the Company applies ASC 718’s guidance for classification, measurement, and expense recognition to all equity-classified and liability-classified and liability -classified awards granted to non-employees.

 

Commitments and contingencies

 

The Company follows subtopic 450-20, Loss Contingencies, in evaluating and reporting contingencies. In accordance with this guidance, the Company records a liability for a loss contingency when it is probable that a liability has been incurred, and the amount of the loss can be reasonably estimated. Loss contingencies may arise from claims, assessments, litigation, fines, penalties, and other sources.

 

During the six months ended December 31, 2025, the lender holding a lien on the Company’s Orofino, Idaho facility filed a notice of default and initiated foreclosure proceedings as a result of the Company’s default of the related note payable. Management is currently evaluating the potential impact of this matter. Refer to Note 10- Commitment and Contingencies for additional information, as well as Note 17 – Subsequent Events.  

 

Related Party Disclosures

 

Under ASC 850 “Related Party Transactions” an entity or person is considered to be a “related party” if it has control, significant influence or is a key member of management personnel. A transaction is considered to be a related party transaction when there is a transfer of resources of obligations between related parties. The Company, in accordance with the standard ASC 850, presents disclosures about related party transactions and outstanding balances with related parties, see Note 9.

 

Earnings per Share

 

The Company computes earnings (loss) per share ("EPS") in accordance with ASC 260, "Earnings per Share" which requires presentation of both basic and diluted EPS on the face of the statement of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of warrants or stock options and the conversion of instruments convertible to common stock. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

 

As of December 31, 2025, and June 30, 2025, there were outstanding warrants that could convert into 3,307,500 common shares, respectively and convertible notes that could be converted into 193,281 and 193,281 shares of common stock on December 31, 2025, and June 30, 2025, respectively. At the end of both periods, the potentially dilutive shares were excluded here because the effect would have been anti-dilutive.

 

Derivative Financial Instruments

 

The Company evaluates its convertible notes to determine if such instruments have derivatives or contain features (such as conversion features) that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company uses a weighted-average Black-Scholes-Merton option pricing model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. The Company had convertible notes with derivative values determined as $433,864 and $34,597 on December 31, 2025, and June 30. 2025, respectively, principally due to its stock price and volatility.

  

Income taxes

 

The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary or permanent differences). The effect on deferred income tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the enactment date.

 

 

 
F-14

Table of Contents

 

 

FASB Accounting Standards Codification Topic 740, Income Taxes (“ASC 740”), clarifies the accounting for uncertainty in income taxes recognized in the financial statements. ASC 740 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of the position. Income tax positions must meet a more-likely-than-not-recognition threshold to be recognized. ASC 740 also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. We have determined that the Company does not have uncertain tax positions on its tax returns for the years 2016, and prior. Based on our evaluation of the transactions and events, the Company does not believe it has any material uncertain tax positions that require measurement. The IRS requires all domestic corporations in existence for any part of the tax year to file an income tax return whether or not they have taxable income. The Company incurred a loss for the fiscal years ended June 30, 2025, and 2024, and has not filed tax returns for either year or since its 2016 filings. The Company has not received any notifications from the IRS. Reported tax benefits and valuation allowances are the Company’s best estimate of its tax positions and have not been reviewed by the taxing authority.

 

Our policy is to recognize interest and/or penalties related to income tax matters in income tax expense. We had no accrual for interest or penalties on our consolidated balance sheets at June 30, 2025, or June 30, 2024, and have not recognized interest and/or penalties in the consolidated statement of operations for the period or year then ended.

 

We are subject to taxation in the U.S., the state of Florida and Idaho. The Company’s tax returns remain subject to potential examination by the tax authorities within 3 years from the filing date.

 

Allowance for Credit Losses 

 

The Company estimates its allowance for credit losses using the Current Expected Credit Loss (CECL) model under ASC 326. The CECL model requires recognition of expected credit losses over the contractual life of financial assets held at the reporting date, considering historical experience, current conditions, and reasonable and supportable forecasts.

 

Financial assets subject to CECL include trade receivables and note receivables. The Company groups financial asset based on shared risk characteristics and evaluates them collectively. The allowance is measured using a combination of historical loss rates, adjusted for current economic trends and forward-looking factors such as industry outlook and macroeconomic indicators (e.g., unemployment rate, GDP).

 

Under CECL, the carrying amount of a financial asset (net of the allowance for credit losses) represents the amount the Company expects to collect. This means that when the CECL estimate is appropriately recorded, the net reported balance of financial assets reflects management’s best estimate of collectible cash flows, based on available and supportable information.

 

Management reviews the adequacy of the allowance at each reporting period and updates estimates as appropriate. Changes in estimates are recorded in the income statement as a component of credit loss expense.  The Company has considered the recent guidance and does not have receivables that would require this level of analysis in determining the net realizable balance of accounts receivable.

  

Cash flows reporting

 

The Company prepares its statements of cashflows in accordance with ASC-230, Statements of Cash Flows, using the indirect method. Cash Equivalents include investments, with original maturities of three months or less. Non-cash investing and financing activities are disclosed separately in the supplemental section of the cash flow statement. Cash receipts from cryptocurrency mining rewards are classified as operating cash inflows. Cash purchases of property and equipment are classified as investing activities, while proceeds from debt or equity financing are included in financing activities. Some transactions were part cash and part no-cash and disclosed accordingly.

 

Advertising Costs

 

Advertising costs are expensed as incurred in accordance with ASC 720-35, Advertising Costs. These costs are included in selling, general and administrative expenses on the consolidated statements of operations. Advertising expenses were $9,550 for six months ended December 31, 2025, and $2,500 for the fiscal year ended June 30, 2025.

 

Equity/Shares Capital

 

The Company accounts for equity transactions in accordance with ASC 505, Equity. Common stock and preferred stock are recorded at par value, with any proceeds received in excess of par value reflected in additional paid-in capital. Equity issuance costs are recorded as a reduction of additional paid-in capital. Shares issued for services or other non-cash consideration are measured at the fair value of the equity instruments issued on the grant date, or the fair value of the services received, whichever is more reliably measurable.

 

 

 
F-15

Table of Contents

 

 

As of December 31, 2025, the Company is authorized to issue 350,000,000 shares of common stock, par value $0.0001 per share, with 27,154,508 shares issued and outstanding, compared to 25,067,479 shares issued and outstanding as of June 30, 2025.

 

On September 8, 2025, the Company designated 10,000 shares of Series A Preferred Stock, par value $0.001 per share. As of December 31, 2025, 2,475 shares of Series A Preferred Stock were issued and outstanding; no preferred shares were issued or outstanding as of June 30, 2025.

 

Recent Accounting Pronouncements

 

Environmental Credits (Proposed Topic 818) - New guidance on how to account for environmental credits like carbon offsets and renewable energy certificates. Focus on consistent recognition, measurement, and disclosure. Still in proposal stage (comment period through April 2025). As no renewable energy sources are used for operations, we currently deem these credits are not applicable.

 

Disaggregation of Income Statement Expenses (ASU 2024-03) - Companies must break out major expense categories (e.g., labor, depreciation) in the notes to financial statements aimed at improving transparency. Effective for annual periods after Dec 15, 2026 (early adoption allowed). This is applicable to the Company but it’s not yet effective and the Company has not elected early adoption.

 

Income Tax Disclosure Improvements (ASU 2023-09) - Requires clearer details on income taxes paid (by federal, state, and foreign) and better breakdowns of rate reconciliations. Helps investors better understand a company’s tax situation. This standard applies to the Company but is not currently applicable to current period financials, as we have incurred losses and have no tax expense.

 

Subsequent events

 

The Company follows the guidance in Section 855-10-50 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The Company evaluates subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company as an SEC filer, considers its financial statements issued when they are widely distributed to users, such as through filing them on EDGAR.

  

NOTE 3. GOING CONCERN

 

As reflected in the accompanying financial statements, the Company has incurred significant operating losses since its inception. For the year ended December 31, 2025, the Company had a net loss of $1,410,116 And has an accumulated deficit of $10,969,465, working capital deficit of $2,100,806 and cash balance of $1,759 as of December 31, 2025.

 

While the Company is attempting to resume and expand operations and generate increased revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect and there is substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate revenues.

 

The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

NOTE 4. PRE-PAID EXPENSES

 

Prepaid expenses primarily consist of advance payments for professional services and other operating costs. The balance was $14,997 as of June 30, 2025. During the six months ended December 31, 2025, the Company recorded additional prepaid expenses of $6,256 and recognized $13,497 as expense as the related services were consumed. As a result, prepaid expenses totaled $10,477 as of December 31, 2025.

 

 
F-16

Table of Contents

 

NOTE 5. OTHER ASSETS

 

As of December 31, 2025, and June 30, 2025, the Company maintained a refundable electricity deposit of $77,069 related to its Orofino, Idaho facility.

 

During the six months ended December 31, 2025, the Company received a capital credit allocation notice from local electrical cooperating totaling $8,127. Capital credits represent the Company’s proportionate share of the cooperative’s margin and as stated by the cooperative. The full amount allocation is ultimately refundable to the Company; however, repayment occurs over the long term through periodic capital credit reimbursements authorized at the discretion of the cooperative’s Board of Directors, based on the cooperative’s financial condition. Repayment of the allocated amount is guaranteed to members but is returned gradually over an extended period. As such, no fixed repayment schedule or interest rate is associated with these credits. The Company recognized the allocation as other income during the quarter and recorded the related receivable as a long-term asset, as repayment is not expected in the near term.

 

Accordingly, total other long-term assets as of December 31, 2025, were $85,196, consisting of $77,069 refundable deposit and $8,127 of its capital credits receivable.

 

NOTE 6. BITCOIN HELD

 

The following table presents information about the Company’s bitcoin holdings:

 

 

 

 

 

 

Quantity

 

 

Amounts

 

 

 

 

 

 

 

 

Balance as of July 1, 2025

 

 

0.1626

 

 

$17,502

 

Revenue recognized from bitcoin mined

 

 

0.0945

 

 

 

10,163

 

Proceeds from sale of bitcoin

 

 

(0.2543)

 

 

(28,641)

Realized gain (loss) on sale/exchange of bitcoin

 

 

-

 

 

 

1,226

 

Balance as of December 31, 2025

 

 

0.0029

 

 

$250

 

 

 

 

 

 

 

 

 

 

 

 

Quantity

 

 

Amounts

 

 

 

 

 

 

 

 

 

 

Balance as of July 1, 2024

 

 

-

 

 

$-

 

Revenue recognized from bitcoin mined

 

 

0.1626

 

 

 

15,701

 

Proceeds from sale of bitcoin

 

 

 

 

 

 

-

 

Realized gain (loss) on sale/exchange of bitcoin

 

 

-

 

 

 

1,801

 

Balance as of June 30, 2025

 

 

0.1626

 

 

$17,502

 

 

NOTE 7. PROPERTY PLANT & EQUIPMENT

 

Property and equipment are recorded at cost. Land is not depreciated. Buildings, building improvements, machinery and equipment, and furniture are depreciated using accelerated methods over their estimated useful lives. Maintenance and repair costs are expensed as incurred, while expenditures that improve or extend the useful lives of the related assets are capitalized. Gains or losses on disposals are recognized in operations. Construction in progress (“CIP”) represents capitalized costs for assets not yet placed into service and is not depreciated.

 

During fiscal 2024, the Company fully depreciated all cryptocurrency mining equipment previously deployed at Simple Mining in Iowa. In March 2025, the Company purchased a co-location facility and certain legacy crypto miners pursuant to an Asset Purchase Agreement with an unaffiliated third party for $500,000. A down payment of approximately $33,000 was made during fiscal 2024. The Company assumed costs for the operation of the facility in October 2024 as an additional consideration for purchase of the premises. From October 2024 through the closing date, the Company incurred approximately $93,000 of electricity, contract labor, and other costs, which were capitalized and allocated to land, building, and machinery and equipment.

 

 
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During the six months ended December 31, 2025, the Company recorded additional building improvements of $6,852 and construction-in-progress additions of $5,748 related to ongoing enhancement activities at the Orofino facility.

                                       

 

 

Estimated Life in years

 

 

December 31, 2025

 

 

June 30,

2025

 

Land- Orofino

 

 

N/A

 

 

$139,363

 

 

$139,363

 

Construction in progress

 

 

N/A

 

 

 

6,648

 

 

 

-

 

Building- Orofino

 

 

30

 

 

 

285,726

 

 

 

285,727

 

Building Improvements- Orofino

 

 

7

 

 

 

32,519

 

 

 

26,837

 

Machinery & Equipment - Electrical Equipment

 

 

7

 

 

 

142,863

 

 

 

142,863

 

Machinery & Equipment - Tools

 

 

5

 

 

 

2,555

 

 

 

2,555

 

Machinery & Equipment - Miners

 

 

1

 

 

 

556,200

 

 

 

556,200

 

Computer Equipment

 

 

3

 

 

 

1,478

 

 

 

1,478

 

Fixed Asset, Gross

 

 

 

 

 

 

1,167,352

 

 

 

1,155,023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Accumulated Depreciation

 

 

 

 

 

 

584,779

 

 

 

566,662

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property Plant and Equipment, Net

 

 

 

 

 

 

582,573

 

 

 

588,361

 

  

Depreciation expense amounted to $18,117 for the six months ended December 31, 2025, and $33,162 for the fiscal year ended June 30, 2025, primarily related to building, building improvements, and equipment. CIP is not depreciated until the related assets are placed in service.

 

See NOTE 10.” COMMITMENTS AND CONTINGENCIES” regarding Liens related to the Orofino property.

 

NOTE 8. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

 

During the six months ended December 31, 2025, the Company accrued amounts owed to vendors and other accrued expenses, which were comprised of the following:

 

 

 

December 31, 2025

 

 

June 30, 2025

 

Vendor Payables

 

 

 

 

 

 

Marketing and promotion costs

 

$9,562

 

 

$4,562

 

SEC regulatory cost

 

 

3,174

 

 

 

2,263

 

Professional fees

 

 

11,800

 

 

 

17,508

 

Crypto operation costs

 

 

21,014

 

 

 

18,303

 

Insurance expense

 

 

5,881

 

 

 

-

 

Website services

 

 

6,000

 

 

 

-

 

Other

 

 

2,550

 

 

 

2,482

 

 

 

 

 

 

 

 

 

 

Vendor Payables (related parties)

 

 

 

 

 

 

 

 

Expense reimbursement

 

 

13,978

 

 

 

4,978

 

Compensation

 

 

5,233

 

 

 

6,000

 

 

 

 

 

 

 

 

 

 

Accounts Payable & Accrued Liabilities

 

$79,192

 

 

$56,095

 

 

During the six months ended December 31, 2025, the Company’s trade payables were short term and due on demand. Approximately 42% of trade payables were outstanding for more than 90 days as of December 31, 2025, compared to approximately 25% outstanding for more than 90 days as of June 30, 2025. Though balances are excessively aged, the Company is not aware of any litigation or dispute requesting immediate payment.

  

 
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NOTE 9.  RELATED PARTY TRANSACTIONS

 

Office space

 

For the six months ended December 31, 2025, the Company recorded $1,500 of rent expense for its executive, administrative, and operating offices located at 151 N. Nob Hill Road, Suite 402, Plantation, FL 33324, which the Company leases from its President, Frank Horkey, at a monthly rental cost of $250 under a related party lease agreement. The lease carries a 12-month term and was renewed through June 30, 2025. As of June 30, 2025, the Company has accrued $3,000 of rent expense in connection with this arrangement which is included in accounts payable and accrued expenses. The Company has determined that it cannot project if this facility will meet its operational needs in the near future (365 days or less), it is not deemed an ongoing lease agreement subject to ASC 842 and therefore only incurs the related monthly expense for usage.

 

Due to Related Parties-accrued compensation

 

During the six months ended December 31, 2025, the Company incurred management advisory fees of $30,000 payable to Squadron Marketing, an advisor to the Company. The amount owed to this advisor as of June 30,2025 was $227,000. During the year, The Company paid $9,000 in cash. As of December 31, 2025, and June 30, 2025, the Company owed this advisor $248,000 and $227,000 respectively, for management advisory fees.

 

During the six months ended December 31, 2025, the Company incurred compensation expense of $303,503, primarily related to payments to key management personnel, including Frank Horkey (President and Chief Financial Officer) at $45,000 per quarter, Lazarus Asset Management LLC (Operations Manager) at $76,751 per quarter, and Antonio Oliveira (Chief Technology Officer) at $30,000 per quarter. Of the total compensation expense, $95,224 was paid in cash, and $60,000 was converted into a promissory note payable. As of December 31, 2025, and June 30, 2025, the Company owed compensation payable of $338,941 and $190,663, respectively.

 

During the six months ended December 31, 2025, the Company incurred board of director fees totaling $31,500. The board of directors includes Frank Horkey, Matthew Cohen and Michael Christiansen. The advisory board consists of Timothy B. Ruggiero, Peter S. Chung and Antonio Oliveira. As of December 31, 2025, and June 30, 2025, the Company owed board of director/advisory board member fees of $122,000 and $90,500, respectively.

 

Notes Payable – Related Parties

 

Related parties’ notes payable consist of convertible and non-convertible notes payable with a principal balance on December 31, 2025, and June 30, 2025, of $364,366 and $304,366, respectively and accrued interest on December 31, 2025, and June 30, 2025, of $28,028 and $9,361, respectively.

 

              The notes do not require regular monthly payments, but rather they are to be settled by the maturity date if not converted.

  

Lazarus Asset Management LLC (“Lazarus”) and Sparta Road Ltd. are related parties as these entities share key management / personnel (Timothy B. Ruggiero) with T-REX.

 

On February 3, 2025, the Company issued Frank Horkey (“Horkey”) a $70,000 Senior Secured Convertible Promissory Note for cash proceeds, bearing interest at 10% per annum and maturing on April 4, 2025. On April 5, 2025, the note was extended to a new maturity date of April 5, 2026, and the accrued interest of $1,151 was added to the principal balance, increasing the total to $71,151. The Company subsequently made a payment of $10,000. As of December 31, 2025, the Note had a principal balance of $61,151 and accrued interest of $3,905, compared to a principal balance of $61,151 and accrued interest of $848 as of June 30, 2025.

 

On March 5, 2025, the Company issued Horkey a $35,000 Senior Secured Convertible Promissory Note for cash proceeds, bearing interest at 10% per annum and maturing on May 4, 2025. On May 5, 2025, the note was extended to a new maturity date of June 5, 2026, and the accrued interest of $585 was added to the principal balance, increasing the total to $35,585. As of December 31, 2025, the principal balance was $35,585 and accrued interest was $2,397, compared to a principal balance of $35,585 and accrued interest of $539 as of June 30, 2025.

 

On March 5, 2025, the Company issued Horkey a $207,630 Senior Secured Convertible Promissory Note bearing interest at 12% per annum and maturing on March 5, 2026, for funds advanced by Horkey to purchase the Company’s Orofino, Idaho facility. The note is secured by a second lien on the Orofino property, as evidenced by a Deed of Trust, and may be prepaid at any time without penalty. As of December 31, 2025, the principal balance was $207,630 and accrued interest was $20,600, compared to a principal balance of $207,630 and accrued interest of $8,004 as June 30, 2025.

 

On September 30, 2025, as compensation for management services the Company issued Lazarus a $15,000 Secured Promissory Note, with an interest rate of 10% per annum, and a maturity date of June 29, 2026. The principal balance on December 31, 2025, was $15,000 and the accrued interest was $375.

 

On September 30, 2025, as compensation for management services the Company issued Horkey a $15,000 Secured Promissory Note, with an interest rate of 10% per annum, and a maturity date of June 29, 2026. The principal balance on December 31, 2025, was $15,000 and the accrued interest was $375.

 

On October 1, 2025, as compensation for management services the Company issued Lazarus a $15,000 Secured Promissory Note, with an interest rate of 10% per annum, and a maturity date of June 30, 2026. The principal balance on December 31, 2025, was $15,000 and the accrued interest was $375.

 

On December 31, 2025, as compensation for management services the Company issued Horkey a $15,000 Secured Promissory Note, with an interest rate of 10% per annum, and a maturity date of June 30, 2026. The principal balance on December 31, 2025, was $15,000 and the accrued interest was $0.

 

 
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Other Related Party Debt

 

In addition to notes payable owed to related parted parties, various officers advanced funds for operating expenses. These amounts are reported on the balance sheet as “Due to related party -advances” on December 31, 2025, and June 30, 2025, in amount of $19,256 and $5,150, respectively. The amounts owed are non-interest bearing, unsecured, and are due on demand.

 

See NOTE 13. COMMON STOCK, NOTE 14. PREFERRED STOCK and NOTE 15. WARRANTS regarding related party transactions for stock and warrants

 

NOTE 10. COMMITMENTS AND CONTINGENCIES

 

Legal contingencies

 

From time to time, the Company may be a defendant in pending or threatened legal proceedings arising in the normal course of business. Management is not aware of any pending, threatened or asserted claims other than a Notice of Default filed on September 24, 2025, by the Holder of the first mortgage of the Orofino property. See “Note 10 – Related Party Transactions”, “Note 12. Notes Payable Unrelated Third Parties”, and “Note 17. Subsequent Events” for additional details.

 

Power Supply Agreement

 

On October 20, 2024, the Company entered into a power supply agreement with Clearwater Power Company (“Clearwater”) for the provision of electric power and related infrastructure to support cryptocurrency mining operations at the Company’s Orofino, Idaho facility

 

The agreement, provides for monthly billing consisting of fixed service charges and variable charges based on actual electricity consumption, including applicable demand charges and utility pass-through fees. Invoices are payable under standard commercial payment terms. Failure to may may result in interest charges or suspension of service.

 

The agreement has an initial multi-year service term and may be terminated by either party for material breach, insolvency, or upon advance written notice, subject to settlement of outstanding obligations.

 

In connection with the agreement, the Company deposited $77,089 with Clearwater as a refundable, non-interest-bearing security deposit that will remain on account for the durations of the service arrangement and is refundable.

 

Mortgages Secured by Orofino Facility

 

The related-party and unrelated third-party mortgages entered into on March 5, 2025, in connection with the acquisition of the Company’s Orofino facility are secured by Deeds of Trust encumbering real property located in Orofino, Idaho. The mortgages are secured by two liens on the property. The promissory note payable to the seller of the Orofino facility, with a principal balance of $267,555 is secured by a senior (first priority) lien on the property and went into default on September 24, 2025.The promissory note payable to a related party, Frank Horkey, with a principal balance of 207,630 is secured by a junior (subordinate) lien on the same property.. See “NOTE 10. RELATED PARTY TRANSACTIONS”, “NOTE 12. UNRELATRED PARTIES” and NOTE.17-“SUBSEQUENT EVENTS” for additional information.

 

Investor relations and Public Relations agreement 

 

On December 15, 2025, the Company entered into an Investor Relations and Financial Public Relations Consulting Agreement with an unrelated third party (the “Consultant”). This agreement has an initial three-month term and is automatically renewed for successive three-month periods unless terminated by either party.

 

Under the agreement, the Company is obligated to pay the Consultant a fixed cash fee of $5,000 per month for investors relations and financial public relations services. Cash payments are due monthly during the term of the agreement. In addition to monthly cash compensation, the agreement provides for equity-based compensation in the form of 50,000 restricted shares of the Company’s common stock, which were issued upon execution of the agreement.

 

As of December 31, 2025, the Company had recorded $5,000 in accounts payable related to services to be rendered under the agreement and issued 50,000 restricted shares of the Company’s common stock which was issued upon execution. Based on the remaining portion of the initial three-month term as of December 31, 2025, the Company’s remaining cash commitment was approximately $10,000, assuming no termination and had no obligations to issue additional equity under the arrangement.

 

 
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NOTE 11. NOTES PAYABLE- UNRELATED THIRD PARTIES

 

Unrelated parties’ notes payable consist of convertible and non-convertible promissory notes. The aggregate gross principal amount outstanding under these notes was $555,395 and $401,780 as of December 31, 2025, and June 30, 2025, respectively.

 

As of December 31, 2025, the Company recorded a debit discount of $119,275, primarily attributable to beneficial conversion features and/or original issue discounts associated with certain convertible instruments. No debt discount was outstanding as of June 30, 2025. After giving effect to the debt discount, net unrelated parties’ notes payable totaled $436,120 and $401,780 as of December 31, 2025 and June 30, 2025, respectively.

 

These notes do not require regular monthly payments, but rather they are to be settled by the maturity date if not converted.

  

(a) Convertible Note Payable - Unrelated Parties

 

On July 1, 2024, the Company issued a private investor a $5,000 180-day Secured Convertible Promissory Note bearing interest at 10% per annum, convertible at $0.50 per share. In connection with the issuance, the Company granted 5,000 restricted common shares and a warrant to purchase 10,000 common shares at $0.75 per share. The Note, originally maturing on December 31, 2024, was extended to June 30, 2025, in exchange for an additional 5,250 restricted common shares and a warrant to purchase 10,500 common shares at $0.75 per share. On March 27, 2025, all warrants were exercised on a cashless basis, resulting in the issuance of 13,725 restricted common shares and the retirement of the warrants. On June 30, 2025, th3 Company issued the remaining 10,500 restricted common shares related to the extension. On June 30, 2025, the Company issued the remaining 10,500 restricted common shares related to the extension. The Note’s outstanding principal of $5,250 and accrued interest of $255 were fully paid during the quarter ended September 30, 2025, and no balance remained outstanding as of December 31, 2025.

 

On September 29, 2023, the Company issued a private investor a $25,000 180-day Senior Secured Convertible Promissory Note, with an interest rate of 10%, convertible at $0.50 per share the lender’s discretion. The Note’s maturity date was March 27, 2024. As further inducement, the Company agreed to issue 25,000 shares of restricted common stock and a warrant to purchase 50,000 shares of restricted common stock, exercisable at $0.75 per share, any time prior to October 2, 2026, the warrant expiration date. On April 2, 2024, the note was extended for 180 days, and as inducement for extension, the Company agreed to issue 25,000 shares of restricted common stock and a warrant to purchase 50,000 shares of restricted common stock, exercisable at $0.75 per share, any time prior to April 2, 2027. On October 4, 2024, the note was extended again for 180 days, and as inducement for extension, the Company agreed to issue 25,000 shares of restricted common stock and a warrant to purchase 50,000 shares of restricted common stock, exercisable at $1.5 per share, any time prior to October 4, 2027. On January 1, 2025, the Company issued 75,000 restricted common stock shares which were obligated to issue as inducement in the note agreement. Further, all three warrants were redeemed through a cashless redemption on March 27, 2025, into 57,500 shares of the Company’s restricted common stock and were retired. On April 4, 2025, the note was extended again for 180 days, without any inducement, with maturity date of October 1, 2025. On June 30, 2025, the Company issued 108,031 restricted common stock shares which were obligated to issue as inducement in the note agreement. This Note was renewed on December 31, 2025, and together with accrued interest, the new face amount is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 26,696 restricted common stock shares. The principal balance owed on December 31, 2025, and June 30, 2025, was $26,696 and $25,000, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $226 and $625, respectively.

 

On July 1, 2024, the Company issued to a private investor a $36,624 180-day Secured Convertible Promissory Note bearing an interest rate of 10% per annum, which may be converted at $0.50 per share at the lender’s discretion. The Note’s maturity date is March 31, 2025. As further inducement to purchase this Note, the Company agreed to issue 36,624 restricted common stock shares and a warrant to purchase 73,248 shares of common stock exercisable at $0.75 per share, prior to June 30, 2027. The company issued 36,624 shares restricted common stock on January 1, 2025. This note was renewed on January 10, 2025, and the investor advanced another $15,000, so together with accrued interest the new face was $52,529 and is due March 31, 2025. In addition, as further inducement to renew the note, the Company agreed to issue 52,529 restricted common stock shares and a warrant to purchase 105,238 shares of common stock exercisable at $0.75 per share, prior to January 10, 2028. The warrants were redeemed through a cashless redemption on March 27, 2025, into 107,502 shares of the Company’s restricted common stock and were retired. On April 10, 2025, the note was extended again for 112 days, without any inducement, with maturity date of July 31, 2025.  On September 1, 2025, the Note was again extended for an additional 45 days, also without inducement. This Note was renewed on December 31, 2025, the investor advanced another $5,000, so together with $3,333 of accrued interest, the new face amount was $57,175 and is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 62,176 restricted common stock shares. The principal balance owed on December 31, 2025, and June 30, 2025, was $62,176 and $53,842, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $528 and $1,196, respectively. 

 

On January 9, 2025, the Company issued to a private investor a $10,000 Senior Secured Convertible Promissory Note bearing interest at 10% per annum and maturing on April 9, 2025. The note is convertible at the lender’s discretion at a rate of $0.50 per share. As a further inducement to purchase the note, the Company agreed to issue 10,000 restricted shares of common stock and a warrant to purchase 20,000 shares of common stock at an exercise price of $0.75 per share, exercisable any time prior to January 9, 2028. On April 10, 2025, the note was extended to a new maturity date of October 7, 2025, with no additional inducements granted. On June 30, 2025, the Company issued 10,000 restricted common stock shares which were obligated to issue as inducement in the note agreement. This Note was renewed on December 31, 2025, the investor advanced another $5,000, so together with $879 of accrued interest, the new face amount was $15,879 and is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 30,000 restricted common stock shares. The principal balance owed on December 31, 2025, and June 30, 2025, was $15,879 and $10,000, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $137 and $472, respectively.

  

On August 29, 2025, the Company issued to a private investor a $10,000 Convertible Promissory Note bearing interest at 15% per annum and maturing on October 28, 2025. The note is convertible at the lender’s discretion at a rate of $0.50 per share. As a further inducement to purchase the note, the Company agreed to issue 10,000 restricted shares of common stock. This Note was renewed on December 31, 2025, and together with $1,500 accrued interest, the new face amount was $11,500 and is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 11,500 restricted common stock shares. The principal balance owed on December 31, 2025, and June 30, 2025, was $11,500 and $0, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $575 and $0, respectively.

 

 

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On September 10, 2025, the Company issued to a private investor a $10,000 Convertible Promissory Note bearing interest at 10% per annum and maturing on September 10, 2026. The note is convertible at the lender’s discretion at a rate of $0.50 per share. As a further inducement to purchase the note, the Company agreed to issue 10,000 restricted shares of common stock. On September 29, 2025, the Company issued 10,000 restricted shares of common stock which were obligated to issue as inducement in the note agreement. As of December 31, 2025, the principal balance was $10,000 and accrued interest was $383.

 

On November 24, 2025, the Company issued a private investor a $10,000 Convertible Promissory Note bearing an interest rate of 10% per annum and maturing on November 19, 2026. This note is convertible at the lender’s discretion at a rate of $0.50 per share. As further inducement to purchase the note, the Company issued 10,000 restricted shares of common stock.  As of December 31, 2025, the principal balance due was $10,000 and the accrued interest was $103.

 

On August 29, 2025, the Company issued to a private investor a $20,000 Convertible Promissory Note bearing interest at 15% per annum and maturing on October 28, 2025. The note is convertible at the lender’s discretion at a rate of $0.50 per share. As a further inducement to purchase the note, the Company agreed to issue 20,000 restricted shares of common stock. On September 29, 2025, the Company issued 20,000 restricted stock shares which were obligated to issue as inducement in the note agreement. This note was renewed on December 1, 2025, and together with $3,000 accrued interest, the new face amount was $23,000 and is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 23,000 restricted common shares. The principal balance owed on December 31, 2025, and June 30,2025, the principal balance was $23,000 and $0, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $1,150 and $0, respectively

 

On September 5, 2025, the Company issued to a private investor a $10,000 Convertible Promissory Note bearing interest at 15% per annum and maturing on November 4, 2025. The note is convertible at the lender’s discretion at a rate of $0.50 per share. As a further inducement to purchase the note, the Company agreed to issue 10,000 restricted shares of common stock. On September 29, 2025, the Company issued 10,000 restricted shares of common stock which were obligated to issue as inducement in the note agreement. This note was renewed on December 1, 2025, and together with $1,500 accrued interest, the new face amount was $11,500 and is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 11,500 restricted stock shares. The principal balance owed on December 31, 2025, and June 30, 2025, was $11,500 and $0, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $575 and $0, respectively.

 

On August 29, 2025, the Company issued to a private investor a $50,000 Convertible Promissory Note bearing interest at 15% per annum and maturing on October 28, 2025. The note is convertible at the lender’s discretion at a rate of $0.50 per share. As a further inducement to purchase the note, the Company agreed to issue 50,000 restricted shares of common stock. On September 29, 2025, the Company issued 10,000 restricted shares of common stock which were obligated to issue as inducement in the note agreement. This Note was renewed on December 31, 2025, and together with $1,936 accrued interest, the new face amount was $51,937 and is due February 1, 2026. In addition, as further inducement to renew the note, the Company issued 51,936 restricted common stock shares. The principal balance owed on December 31, 2025, and June 30, 2025, was $51,936 and $0, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $441 and $0, respectively.

 

On October 29, 2025, the Company issued a private investor a $25,000 Convertible Promissory Note bearing interest at 15% per annum with maturity on December 28, 2025. The note is convertible at $0.50 per share. As a further inducement to purchase the note, the Company issued 25,000 restricted shares of common stock. This note is in default. As of December 31, 2025, the principal balance was $25,000 and the accrued interest was $958.

 

See due to Note 9 “Related Parties Transactions” for additional senior secured convertible promissory notes issuances.

 

(b) Note Payable – Unrelated Parties

 

On March 5, 2025, the Company issued to the seller of the Orofino facility a $267,555 Secured Promissory Note bearing interest at 8% per annum and maturing on May 15, 2025. The note is secured by a first lien on the Orofino, Idaho property pursuant to a Deed of Trust. Under the terms of the agreement, upon default, the interest rate increases to 18% per annum, and a 15% late charge is applied to the outstanding principal. As the Company did not remit payment within ten days of the maturity date, the note went into default on May 25, 2025, and a late charge of $40,133 was added to the principal balance. The beneficiary filed a Notice of Default on September 24, 2025, under the Deed of Trust in Clearwater County, Idaho. The principal balance owed on December 31, 2025, and June 30, 2025, was $307,688 and $307,688, respectively. The note’s accrued interest on December 31, 2025, and June 30, 2025, was $38,414 and $10,414, respectively.

  

 
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NOTE 12. DERIVATIVE LIABILITIES

 

The Company has certain convertible notes outstanding. The conversion features require evaluation and recognition as derivative liabilities at their fair values. As of December 31, 2025, the derivative liability totaled $433,864.  As of June 30, 2025, the derivative liability was $34,597, principally related to convertible notes issued in 2025.

 

For the period ended December 31, 2025, the Company recorded a loss of $29,894 related to the change in fair value of derivative liabilities.

 

The following table summarizes the weighted average key inputs used in the Black-Scholes model for all outstanding conversion feature derivative liabilities as of the measurement dates:

 

Input

 

Weighted Avg. on

December 31, 2025

 

 

Weighted Avg. on

June 30, 2025

 

Stock price

 

$1.32

 

 

$0.60

 

Exercise price (conversion price)

 

$0.50

 

 

$0.50

 

Risk-free interest rate

 

 

3.74%

 

 

4.29%

Expected term (years)

 

 

0.14

 

 

 

0.50

 

Expected volatility

 

 

252.64%

 

 

75.94%

Dividend yield

 

 

0%

 

 

0%

 

 

 

 

 

 

 

 

 

The following table summarizes the changes in derivative liability:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Description

 

December 31, 2025

 

 

June 30, 2025

 

Derivative Liability beginning balance

 

 

34,597

 

 

 

-

 

Initial recognition of derivatives

 

 

470,136

 

 

 

85,374

 

Change in fair value

 

 

29,894

 

 

 

34,096

 

Settlements/conversions

 

 

(100,763)

 

 

(84,874)

Derivative Liability ending balance

 

 

433,864

 

 

 

34,597

 

  

NOTE 13. COMMON STOCK

 

Frank Horkey received 350,000 restricted common stock shares as the Company’s President and Director since his previous contract expired on December 31, 2019 and, on July 1, 2022, he received 250,000 restricted common stock shares or his three year board position vesting, as follows: 83,333 shares upon signing as of July 1, 2022; 20,833 shares vest quarterly the fiscal year ended June 30, 2024; and 20,833 shares vest quarterly for the period ended June 30, 2025. All shares were fully vested at June 30, 2025.

 

On July 1, 2022, Michael Christiansen received 250,000 restricted common stock shares for his three-year board position vesting, as follows: 83,333 shares upon signing as of July 1, 2022; 20,833 shares vest quarterly the period ended June 30, 2024; 20,833 shares vest quarterly for the fiscal year ended June 30, 2025. All shares were fully vested at June 30, 2025.

 

On July 1, 2022, Squadron Marketing LLC received 250,000 restricted common stock shares for acting on the Company’s Advisory Board for fiscal 2023 through 2025, vesting as follows: 83,333 shares upon signing as of July 1, 2022; 20,833 shares vest quarterly the fiscal year ended June 30, 2024; 20,833. vest quarterly for the fiscal year ended June 30, 2025. All shares were fully vested at June 30, 2025.

 

On July 1, 2022, Lazarus Asset Management LLC received 250,000 restricted common stock shares for serving on the Company’s Advisory Board for fiscal 2023 through 2025, vesting as follows: 83,333 shares upon signing as of July 1, 2022; 20,833 shares vest quarterly the fiscal year ended June 30, 2024; 20,833 shares vest quarterly for the fiscal year ended June 30, 2025. All shares were fully vested at June 30, 2025.

 

On July 1, 2022, John Bennet received 50,000 restricted common stock shares for extending his consulting contract through fiscal year end 2023. On February 10, 2023, as an incentive to accept the position of the Company’s Chief Financial Officer for the period of January 1, 2023- through the date of his death which coincided with the Company’s year end of fiscal year 2024, John Bennet was awarded an additional 100,000 restricted common stock shares that vested at 16,666 shares per quarter. All shares were fully vested at June 30, 2025.

 

On September 25, 2024, a private investor purchased 150,000 restricted common stock shares for $150,000. In addition, the investor received a warrant to purchase 150,000 shares of the Company’s common stock for a period of three years exercisable at $1.50 per share prior to September 25, 2027. These shares were issued on January 1, 2025. The warrant was redeemed through a cashless exercise on March 27, 2025, into 67,500 shares of the Company’s restricted common stock.

 

 
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On October 5, 2024, a private investor purchased 100,000 restricted common stock shares for $100,000. In addition, the investor received a warrant to purchase 100,000 shares of the Company’s common stock for a period of three years exercisable at $1.50 per share prior to October 5, 2027. These shares were issued on January 1, 2025. The warrant was redeemed through a cashless exercise on March 27, 2025, into 25,000 shares of the Company’s restricted common stock.

  

On October 11, 2024, a private investor purchased 100,000 restricted common stock shares for $100,000. In addition, the investor received a warrant to purchase 100,000 common stock shares for a period of three years exercisable at $1.50 per share prior to October 11, 2027. These shares were issued on January 1, 2025. The warrant was redeemed through a cashless exercise on March 27, 2025, into 25,000 shares of the Company’s restricted common stock.

 

On October 15, 2024, a private investor purchased 50,000 restricted common stock shares for $50,000. In addition, the investor received a warrant to purchase 50,000 common stock shares for a period of three years exercisable at $1.50 per share prior to October 15, 2027, which shares were issued on January 1, 2025. The warrant was redeemed through a cashless exercise on March 27, 2025, into 12,500 restricted common stock shares.

 

On December 6, 2023, the Company agreed to sell to a private investor, 20,000 Units at a price of $0.75 per Unit and received $15,000 recorded as deposit payable. The 15,000 shares were issued on January 1, 2025.

 

On January 1, 2025, Frank Horkey received 300,000 restricted common stock shares as settlement of his advisory fees of $105,000 owed to him.

 

On January 1, 2025, Peter Chung through Squadron Marketing LLC received 471,429 restricted common shares as settlement for advisory fees of $165,000 owed to him.

 

On January 1, 2025, Frank Horkey, Michael Christiansen and Peter Chung received 60,000 restricted common stock shares each as settlement for their director fees of $21,000 owed to them.

 

On July 1, 2024, Matthew Cohen received 250,000 restricted common stock shares for serving on the Company’s Board of Directors for fiscal 2024 through 2027, with vesting as follows: twenty thousand eight hundred thirty-four (20,834) shares vest quarterly beginning July 1, 2024. He also received a warrant to purchase 250,000 shares of the Company’s restricted common stock shares that could be exercised at any time prior to July 1, 2027, at an exercise price of $1.50, with 20,834 warrants vesting quarterly beginning July 1, 2024. On December 20, 2024, Matthew Cohen resigned from his position as a member of our Board of Directors. The shares and warrants issued to Matthew Cohen vest through the date of resignation were 41,667 shares and 41,667 warrants. On January 1, 2025, the Company issued 41,667 restricted common stock shares and redeemed the warrant through a cashless exercise redemption into 10,417 restricted common stock shares.

 

On July 1, 2024, Antonio Oliveira received 250,000 shares for serving on the Company’s Advisory Board for fiscal 2024 through 2027, with vesting 20,834 shares vesting quarterly beginning July 1, 2024. He also received a warrant to purchase 250,000 restricted common stock shares at any time prior to July 1, 2027, at an exercise price of $1.50 vesting on the same schedule. On July 1, 2025, the Company issued 250,000 restricted common stock shares for future services and on March 27, 2025, Antonio Oliveira redeemed the warrant through cashless redemption into 62,500 restricted common stock shares.

 

On March 31, 2025, issued 75,000 restricted common stock shares to Don Lopez, nephew of the Company’s President, Frank Horkey. The issuance was made in recognition of Mr. Lopez’s services as a technical consultant provided to the Company in the current fiscal year. As of the issuance date, the restricted shares were fully vested. Mr. Lopez’s consulting agreement was not renewed following the share issuance.

  

On January 1, 2025, the Company entered into a service agreement with Aubyn Honeysett to manage its colocation facility in Orofino, Idaho. Under the terms of the agreement, Ms. Honeysett was awarded 24,000 restricted common stock shares, which were scheduled to vest ratably at 667 shares per month over a 36-month term, subject to her continued service with the Company. On March 31, 2025, the Company issued all 24,000 shares in advance of the vesting schedule. Ms. Honeysett’s services were terminated on May 23, 2025, and as of June 30, 2025, the unvested portion of 19,999 shares was forfeited and deemed authorized shares note issued or outstanding share cancellation

 

On January 1, 2025, the Company entered into a service agreement with Bryce Greenfield in connection with his role managing the Company’s co-location facility in Orofino, Idaho, pursuant to which, Mr. Greenfield was granted 75,000 restricted common stock shares, which were scheduled to be vested in equal monthly installments of 2,083 shares over a 36-month period, subject to his continued service with the Company. On March 31, 2025, the Company issued all 75,000 shares in advance of the vesting schedule. Mr. Greenfield’s services were terminated on May 23, 2025, and as of June 30, 2025, the unvested portion of 62,500 shares was forfeited and deemed authorized shares note issued or outstanding. Share cancellation

 

On April 1, 2025, a private investor purchased 20,000 restricted common stock shares for $10,000. These shares were issued on June 30, 2025.

 

On April 1, 2025, a private investor purchased 100,000 restricted common stock shares for $50,000. These shares were issued on June 30, 2025.

 

On April 1, 2025, a private investor purchased 50,000 restricted common stock shares for $25,000. These shares were issued on June 30, 2025.

 

On April 1, 2025, a private investor purchased 300,000 restricted common stock shares for $150,000. These shares were issued on June 30, 2025.

 

On April 1, 2025, a private investor purchased 200,000 restricted common stock shares for $100,000. These shares were issued on June 30, 2025.

 

 
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On April 1, 2025, a private investor purchased 200,000 restricted common stock shares for $100,000. These shares were issued on June 30, 2025.

 

On March 31, 2025, The Company acquired proprietary software and technical knowhow of Baoblock, Inc. for $210,000, paid via the issuance of 600,000 restricted shares of common stock and $10,000 in cash. These shares were issued on June 30, 2025.

 

On June 25, 2025, the Company’s legal counsel was awarded 100,000 restricted common stock shares in recognition of exemplary legal services rendered to the Company during the fiscal year ended June 30, 2025, which was valued at $60,100. 

 

On July 1, 2025, the Company approved a stock-based compensation arrangement for its Chief Technology Officer, Antonio Oliveira, consisting of 250,000 restricted common shares for services to be provided from fiscal 2025 through fiscal 2028, vesting 20,834 shares quarterly beginning July 1, 2025. On September 29, 2025, the Company issued 250,000 restricted common shares in connection with this arrangement.

 

On September 29, 2025, the Company issued 661,553 common shares to New Hudson Properties LLC, a related party, to settle the stock subscription liability of $319,018 for Lazarus Asset Management LLC recorded as of June 30, 2025, related to note conversions, note inducement shares, and warrants previously exercised on a cashless basis.

 

On September 29, 2025, the Company issued 132,000 restricted common shares to Joseph Womack pursuant to a release agreement from his arrangement to provide advisory services. The issuance was valued at $79,200.

 

On September 29, 2025, the Company issued 100,000 restricted common shares to its legal counsel as compensation for legal services valued at $60,000 rendered during the six months ended December 31, 2025.

 

On September 29, 2025, the Company issued 200,000 restricted common shares to a third-party consultant as compensation for services related to introducing the Company to potential investors. The issuance was valued at $120,000.

 

On November 15, 2025, the Company approved a stock-based compensation arrangement for its newly appointed director, Matthew Cohn. Under the arrangement, Mr. Cohen was granted 280,000 restricted shares of the Company’s common stock for services to be provided over the period from November 15, 2025, through December 31, 2028. The award vests as follows:30,000 shares vested on November 15, 2025, with the remaining shares vesting in quarterly installment of 20,834 shares beginning January 1, 2026. On December 15, 2025, the Company issued 280,000 restricted common shares pursuant to this arrangement.

 

On December 15, 2025, the Company approved a stock-based compensation arrangement for its newly appointed director, Matthew Cohn. Under the arrangement, Mr. Cohen was granted 280,000 restricted shares of the Company’s common stock for services to be provided over the period from July 1, 2025, through December 31, 2025.

 

On December 15, 2025, the Company issued an aggregate of 20,000 shares of common stock to two consultants as payment of bonuses for services rendered. Eash Consultant received 10,000 shares.

 

On December 15, 2025, the Company entered into an investor relations and financial public relations agreement with a third party. As consideration for services to be provided under the agreement, the Company issued 50,000 restricted shares of its common stock. The services under the agreement are to be provided from December 15, 2025, through March 15, 2025.

 

See “NOTE 9. RELATED PART TRANSACTION” and NOTE 11. NOTES PAYABLE- UNRELATED THIRD PARTIES” regarding the shares issued as incentive with NOTE payables.

  

NOTE 14. PREFERRED STOCK

 

On September 8, 2025, the Company filed a Certificate of Designation with the Secretary of State of Nevada authorizing 10,000 shares of Series A Preferred Stock, par value $0.001 per share, and establishing the rights and preferences of the class. The Series A Preferred Stock carries a stated value of $1.00 per share, subject to adjustment as set forth in the designation.

 

Holders of Series A Preferred Stock are entitled to receive cumulative dividends at 10% per annum, payable quarterly within 30 days of January 1, April 1, July 1 and October 1. Dividends may be paid in cash or, at the option of the holder, accreted to and increase the stated value of the shares. No dividends had accrued or were payable as of September 30, 2025.

 

Each Series A Preferred share entitles the holder to 500 votes per share on all matters submitted to a vote of stockholders.

 

 
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Upon liquidation, dissolution or winding up of the Company, holders of Series A Preferred Stock are entitled to receive, prior to distributions to holders of junior securities, an amount equal to the par value plus any accumulated dividends or other amounts then due. If available assets are insufficient to pay these amounts in full, distributions will be made pro rata among preferred holders.

 

The Series A Preferred Stock is convertible at any time after issuance into shares of the Company’s common stock at a conversion rate of 500 common shares for each preferred share, subject to standard anti-dilution adjustments. Conversions are limited to the extent that a holder (together with affiliates) would beneficially own more than 4.99% of the Company’s outstanding common stock.

 

On September 29, 2025, the Board of Directors approved the issuance of 1,368 shares of Series A Preferred Stock to Frank Horkey in exchange for cancelation of $239,571 of related-party notes and accrued interest, and 1,107 shares of Series A Preferred Stock to Timothy B. Ruggiero (or his assigns) in exchange for cancelation of $193,654 of related-party notes and accrued interest. These issuances were recorded at the fair value of the consideration transferred, in accordance with ASC 470 and ASC 480.

 

As of December 31, 2025, there were 2,475 shares of Series A Preferred Stock issued and outstanding. As of June 30, 2025, no Series A Preferred shares were issued or outstanding.

  

NOTE 15. WARRANTS

 

Warrants Issued for Investment

 

On February 8, 2024, entities belonging to Peter S. Chung and Timothy B. Ruggiero, collectively, accepted a Pre-Funded Common Stock Purchase Warrant to purchase three million shares of the Company’s restricted common stock at $.01 per share until the Warrant has been exercised in full. This warrant was issued as full consideration for their surrendering of 1.9 million shares of the Company’s Founder's Common Stock.

 

On March 24, 2023, in connection with a $50,000 convertible promissory note issued to a private investor, the Company granted a warrant to purchase 100,000 shares of restricted common stock at an exercise price of $0.75 per share. The warrant became exercisable upon issuance and expires on March 24, 2026.

 

See “Note 11. NOTES PAYABLE- UNRELATED THIRD PARTIES”, Note Payable section for details on convertible promissory notes issued with warrants on January 9, 2025.

 

Certain of the shares and warrants noted above were issued to Board Members, Advisory Board Members and Consultants for services to be rendered for periods subsequent to June 30, 2025. Amounts related to shares issued as compensation for services not yet performed are treated as prepaid consulting (current and non-current). Compensation expense would be incurred in subsequent periods as services are provided in accordance with the respective agreement.

 

The following are changes and balances for common share equivalent due to outstanding warrants:

 

 

 

Warrants -

 

 

Weighted

 

 

Warrants

 

 

Weighted

 

 

 

Common

 

 

Average

 

 

exercisable -

 

 

Average

 

 

 

Share

 

 

Exercise price

 

 

Common

 

 

Exercise price

 

 

 

Equivalents

 

 

 

 

Share

 

 

 

 

 

 

 

 

 

Equivalents

 

 

 

 

 

 

8,999,089

 

 

$0.91

 

 

 

8,665,756

 

 

$0.88

 

Additions

Granted

 

1,969,831

 

 

 

1.50

 

 

 

2,094,831

 

 

 

1.50

 

Additions

Granted

 

895,939

 

 

 

0.75

 

 

 

895,939

 

 

 

0.75

 

Additions

Granted

 

60,000

 

 

 

0.01

 

 

 

60,000

 

 

 

0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cancellations

Cancelled

 

(457,500)

 

 

0.75

 

 

 

(457,500)

 

 

0.75

 

Cancellations

Cancelled

 

(208,333)

 

 

1.50

 

 

 

-

 

 

 

1.50

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercised

Exercised

 

(5,669,506)

 

 

1.50

 

 

 

(5,669,506)

 

 

1.50

 

Exercised

Exercised

 

(2,157,390)

 

 

0.75

 

 

 

(2,157,390)

 

 

0.75

 

Exercised

Exercised

 

(120,000)

 

 

0.01

 

 

 

(120,000)

 

 

0.01

 

Adjustment

 

 

(4,630)

 

 

1.50

 

 

 

(4,630)

 

 

1.50

 

 

 

 

3,307,500

 

 

$0.11

 

 

 

3,307,500

 

 

$0.11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additions

Granted

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Exercised

Exercised

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding as of December 31, 2025

 

 

3,307,500

 

 

$0.11

 

 

 

3,307,500

 

 

$0.11

 

 

As of December 31, 2025, the weighted average remaining contractual life of the warrants was 1.14 years.

  

 
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NOTE 16. INCOME TAXES

 

The components of income tax balances for the periods ended December 31, 2025, and June 30, 2025, are as follows:

 

 

 

For the Fiscal Year Ended

 

 

For the Fiscal Year Ended

 

 

 

31-Dec-25

 

 

30-Jun-25

 

Net losses before taxes

 

$1,410,116

 

 

$2,535,552

 

Adjustments to arrive at taxable income/loss

 

 

 

 

 

 

 

 

Permanent differences:

 

 

(121,580)

 

 

(119,471)

Temporary differences:

 

 

-

 

 

 

-

 

Taxable loss/(Income)

 

 

1,288,536

 

 

 

2,416,081

 

 

 

 

 

 

 

 

 

 

Current Year Taxable income (loss)

 

 

1,288,536

 

 

 

2,416,081

 

NOL carried forward prior year (tax return)

 

 

9,439,879

 

 

 

7,023,798

 

NOL carried forward at period end

 

 

10,728,415

 

 

 

9,439,879

 

 

 

 

 

 

 

 

 

 

Deferred Tax Asset - Federal Rate (21%)

 

$2,252,967

 

 

$1,982,375

 

Deferred Tax Asset - State Rate (5.5%)

 

 

590,063

 

 

 

519,193

 

Total Deferred Tax Asset

 

 

2,843,030

 

 

 

2,501,568

 

 

 

 

 

 

 

 

 

 

Valuation Allowance

 

 

(2,843,030)

 

 

(2,501,568)

Deferred tax per books

 

 

-

 

 

 

-

 

                                    

Due to the changes the Tax Reform Act of 1986 and the Tax Cut and Jobs Act of 2017, net operating loss carry forwards for Federal Income tax reporting purposes are subject to additional limitations. Should certainly changes in ownership occur, our net operating loss carry forwards may be limited to use in future years. In addition, tax rates on corporations were reduced and certain other deductions limited. These changes may affect the income tax benefit calculation and related allowance during subsequent fiscal years. The IRS requires all domestic corporations in existence for any part of the tax year to file an income tax return whether or not they have taxable income. The Company has filed tax returns through its fiscal year ended June 30, 2016. The Company incurred a loss for the fiscal years ended June 30, 2025, and 2024 and has not filed tax returns for either year. The Company has not received any notifications from the IRS. Reported tax benefits and valuation allowances are the Company’s best estimate of its tax positions and have not been reviewed by the taxing authority.

  

NOTE 17. SUBSEQUENT EVENTS

 

The Company evaluated all events and transactions that occurred after the balance sheet date through the date through November 28, 2025, the date the financial statements were issued. The Company entered into the following material transactions requiring disclosure.

 

Purchase Money Mortgage Maturity

 

The promissory note (the “Note”) secured by a Deed of Trust on the Orofino data center matured on May 15, 2025. The principal balance due at maturity was approximately $267,000. Including interest, penalties and late charges, the outstanding balance was approximately $325,000. A Notice of Default was filed on September 24, 2025, was filed on September 24, 2025, and the Company was provided with a 115-day period from the date of filing to cure the default and avoid foreclosure. A Notice of Trustee’s Sale was subsequently issued, scheduling a foreclosure sale for February 10,2026. After December 31, 2025, the scheduled sale was postponed following the Company’s presentation of funds and intent to satisfy the mortgage obligation.

 

As of the date of issuance of the financial statements, the Company is in discussions with the mortgage holder regarding the timing of the final payment and intends to cure the outstanding balance. The Company continues to operate the Orofino facility. The Company evaluated the facility for impairment and determined that its estimate fair value exceeds its carrying amount; accordingly, no impairment was recorded. The foreclosure related events represent non-recognized subsequent events, and therefore, no adjustments were made to the financial statements.

 

Board Service Agreement

 

On January 1, 2026, the Company entered into a Board Member Service Agreement with Katharyn Fiel, pursuant to which Ms. Field agreed to serve as a member of the Company’s Board of Directors for a three-year term ending December 31, 2028. This agreement provides for monthly cash compensation and equity-based compensation, subject to continued service.

 

Consulting Service Agreement

 

On January 2, 2026, the Company entered into a Consulting Services Agreement with an unrelated third party that requires a monthly cash fee, payable only upon and subject to raising $5,000,000. In addition, the agreement provides for equity compensation in the form of 1,250,000 shares of the Company’s common stock to be issued to the Consultant, upon signing the agreement. Subsequent to the year end, the Company has issued 1,250,000 shares to the third party.

 

No other material subsequent events were identified that would require adjustment to, or disclosure in, the accompanying financial statements.

  

 
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Item 2. Management’s Discussion and Analysis of Financial Condition or Plan of Operation.

 

T-Rex Acquisition Corp is hereinafter referred to as “we”, “our”, or “us”.

 

FORWARD-LOOKING STATEMENTS

 

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

 

RESULTS OF OPERATION

 

Quarter Ended December 31, 2025, Compared to Quarter Ended December 31, 2024

 

Revenue for the Quarter ended December 31, 2025, was $2,240 compared to $0 for the quarter ended December 31, 2024, an increase of $2,240 or 100%. The increase in revenues is primarily attributable to resumption of our mining operation as the Orofino facility.

 

Our net loss for the quarter ended December 31, 2025, was $755,902 compared to a net loss of $417,427 during the quarter ended December 31, 2024. The increase in the net loss is primarily attributable to a substantial increase in stock issued for services.

 

During the three months ended December 31, 2025, we incurred operating expenses of $649,756 compared to $320,188 for the same period in 2024.  The increase in expenses was mainly due to a decrease in shares issued for services and an increase in management and consulting fees.

 

During the quarter ended December 31, 2025, we incurred interest expenses of $35,003 compared to $11,865 incurred during the quarter ended December 31, 2024.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Quarter Ended December 31, 2025

 

As of December31, 2025, our current assets were $12,486 and our current liabilities were $2,113,292, which resulted in a working capital deficit of $2,100,806.

 

Cash Flows from Operating Activities

 

For the six months ended December 31, 2025, net cash flows used in operating activities was $175,395 compared to $481,329 for the same period in 2024.  

 

Cash Flows from Investing Activities

 

For the six months ended December 31, 2025, net cash flows used by investing activities was $12,329 and December 31, net cash flows used in investing activities was $0.

 

Cash Flows from Financing Activities

 

For the six months ended December 31, 2025, net cash flows provided by financing activities were $139,750 compared to $481,437 for the same period in 2024.

 

 
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PLAN OF OPERATION AND FUNDING

 

We expect that working capital requirements will continue to be funded through a combination of our proceeds from the sales of stock and generation of revenues from acquisitions. Our working capital requirements are expected to increase in line with the growth of our business.

 

Our principal demands for liquidity are to increase business operations and for general corporate purposes. We intend to meet our liquidity requirements, including capital expenditures related to future business operations, and the expansion of our business, through cash flow provided by funds raised through proceeds from the issuance of debt or equity.

  

MATERIAL COMMITMENTS

 

See Commitments and Contingencies section in NOTE 10.

 

CONVERTIBLE DEBENTURES

 

See due to related parties and notes payable section in Note 9 and Note 11.

 

PURCHASE OF SIGNIFICANT EQUIPMENT

 

The Company intends to secure an additional 275 latest generation ASIC 270 terrahache miners over the next ninety days. Pricing for ASIC miners is generally directly related to the price of bitcoin; as of the date of this filing, these particular ASIC miners cost between $5,200 and $5,800 per ASIC miner. Our planned purchase of these miners is subject to our financial ability to do so and/or to obtain equity financing to pay for the ASIC miners.

 

CRITICAL ACCOUNTING POLICIES

 

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

 

OFF-BALANCE SHEET ARRANGEMENTS

 

As of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

  

GOING CONCERN 

 

The Company’s financial condition raises substantial doubt about its ability to continue as a going concern due to: Financial Deficits: As of December 31, 2025, the Company: (a) reported an accumulated deficit of $10,969,465 and a working capital deficit of $2,100,806; (b) held only $1,759 in cash at the end of the period, which may be insufficient to support daily operations; and (c) had net cash used in operating activities for the 6 months ended December 31, 2025 of $175,395.

 

While the Company is attempting to generate greater revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect and there is a substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate revenues and raise capital. 

 

 
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Based on the foregoing, note that the Company is subject to the following Debt Defaults and Foreclosure, Regulatory and Tax Non-Compliance Issues, and Significant Related Party Transactions.

 

Summary of Material Financial and Regulatory Risks

 

Based on the Company's most recent financial disclosures, the following material issues regarding debt defaults, regulatory non-compliance, and related-party dependencies have been identified:

 

Debt Defaults and Foreclosure Proceedings

 

The Company faces critical legal and financial risks concerning its primary operational facility in Orofino, Idaho.

 

 

·

Notice of Default: A lender holding a first lien on the Orofino facility filed a notice of default and initiated foreclosure proceedings following a default on the related note payable.

 

·

Matured Note: A secured promissory note with an original principal balance of $267,555 matured on May 15, 2025, and remains unpaid.

 

·

Accrued Penalties: Due to the default, the outstanding balance has grown to approximately $325,000 as of December 31, 2025.

 

·

Late Charges and Interest: The default triggered a contractual interest rate hike to 18% per annum and a one-time 15% late charge ($40,133) added to the principal.

 

·

Pending Foreclosure Sale: A foreclosure sale was scheduled for February 10, 2026; however, it has been postponed as the Company attempts to satisfy the mortgage obligation.

 

Regulatory and Tax Non-Compliance

 

The Company is currently non-compliant with several federal and operational obligations:

 

 

·

Delinquent Tax Filings: The Company has not filed federal income tax returns for the fiscal years ended June 30, 2024, or June 30, 2025.

 

·

Aged Payables: Approximately 42% of trade payables were outstanding for more than 90 days as of December 31, 2025, compared to 25% as of June 30, 2025.

 

·

Unpaid Regulatory Costs: The Company has reported accrued but unpaid SEC regulatory costs totaling $3,174.

 

Significant Related Party Transactions

 

The Company is heavily reliant on insiders for management services and debt financing:

 

 

·

Accrued Compensation: The Company owes $708,941 in accrued compensation to related parties as of December 31, 2025.

 

·

Related Party Debt: Outstanding principal on notes payable to related parties totaled $364,366 at the end of the period, with an additional $28,028 in accrued interest.

 

·

Preferred Stock Issuance: On September 29, 2025, the Company issued Series A Preferred Stock to President Frank Horkey and advisor Timothy Ruggiero in exchange for the cancellation of $433,225 in combined related-party debt and interest.

 

 
5

Table of Contents

 

RECENTLY ISSUED ACCOUNTING STANDARDS 

 

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

 

See “NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES” section “Recent Accounting Pronouncements”

 

Item 3. Quantitative and Qualitative Disclosure about Market Risk.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

Item 4. Controls and Procedures.

 

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

We maintain controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures. Based upon their evaluation of those controls and procedures performed as of the end of the periods covered by this report, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective.

  

MANAGEMENT’S QUARTERLY REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

 

Our Chief Executive Officer/Chief Financial Officer are responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our Board of Directors, management and other personnel, 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 and includes those policies and procedures that:

 

 

·

Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

 

 

 

 

·

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of management and our directors; and,

 

 

 

 

·

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

 

 
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Table of Contents

 

Because of its inherent limitations, our internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Our Chief Executive Officer/Chief Financial Officer assessed the effectiveness of our internal control over financial reporting as of September 30, 2025. In making this assessment, management used the criteria set forth by the 1992 Committee of Sponsoring Organizations of the Treadway Commission (“2013 COSO”) in Internal Control — Integrated Framework.

 

Based on our assessment, our Chief Executive Officer/Chief Financial Officer concluded that the Company’s disclosure controls and procedures were not effective as of December 31, 2025, based on those criteria, due to:

 

 

·

Segregation of Duties: The Company lacks proper segregation of functions with respect to its cash and disbursements due to limited staff.

 

·

Qualified Personnel: The Company has a shortage of accounting personnel with adequate public company experience, SEC reporting, and US GAAP

 

·

This weakness does not enable us to maintain adequate controls over our financial accounting and reporting processes regarding the accounting for non-routine and non-systematic transactions. There is a risk that a material misstatement of the financial statements could be caused, or at least not be detected in a timely manner, by this shortage of qualified resources.

  

In light of this conclusion and as part of the preparation of this report, we have applied compensating procedures and processes as necessary to ensure the reliability of our financial reporting. Accordingly, management believes, based on its knowledge, that (1) this report does not contain any untrue statement of a material fact or omit to state a material face necessary to make the statements made not misleading with respect to the periods covered by this report, and (2) the financial statements, and other financial information included in this report, fairly present in all material respects our financial condition, results of operations and cash flows for the years and periods then ended.

 

This report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC that permit us to provide only Management’s Report in this report.

 

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

 

There were no significant changes in our internal control over financial reporting during the six months ended December 31, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 
7

Table of Contents

 

PART II—OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

See Commitments and Contingencies section in NOTE 10.

 

Item 1A. Risk Factors.

 

There have been no material changes in the Company’s risk factors from those previously disclosed in our Annual Report on Form 10-K for the year ended June 30, 2025.

 

Item 2. Unregistered Sales of Equity Securities.

 

On July 1, 2025, the Company approved a stock-based compensation arrangement for its Chief Technology Officer, Antonio Oliveira, consisting of 250,000 restricted common shares for services to be provided from fiscal 2025 through fiscal 2028, vesting 20,834 shares quarterly beginning July 1, 2025. On September 29, 2025, the Company issued 250,000 restricted common shares in connection with this arrangement.

 

On September 29, 2025, the Company issued 661,553 common shares to New Hudson Properties LLC, a related party, to settle the stock subscription liability for Lazarus Asset Management LLC recorded as of June 30, 2025, related to note conversions, note inducement shares, and warrants previously exercised on a cashless basis.

 

On September 29, 2025, the Company issued 132,000 restricted common shares to Joseph Womack pursuant to a release agreement for informal advisory services provided while he was being considered for a potential Board position.

 

On September 29, 2025, the Company issued 100,000 restricted common shares to its legal counsel as compensation for legal services rendered during fiscal year 2026.

 

On September 29, 2025, the Company issued 200,000 restricted common shares to a third-party consultant as compensation for services related to introducing the Company to potential investors.

  

On September 29, 2025, the Company issued 10,000 restricted shares of common stock to a private investor. These shares were issued as inducement equity pursuant to a financing agreement executed on August 29, 2025.

 

On September 29, 2025, the Company issued 10,000 restricted shares of common stock to a private investor. These shares were issued as inducement equity pursuant to a financing agreement executed on September 10, 2025.

 

On September 29, 2025, the Company issued 20,000 restricted shares of common stock to a private investor. These shares were issued as inducement equity pursuant to a financing agreement executed on August 29, 2025.

 

On September 29, 2025, the Company issued 10,000 restricted shares of common stock to a private investor. These shares were issued as inducement equity pursuant to a financing agreement executed on September 5, 2025.

 

On September 29, 2025, the Company issued 10,000 restricted shares of common stock to a private investor. These shares were issued as inducement equity pursuant to a financing agreement executed on August 29, 2025.

 

On September 29, 2025, the Board of Directors approved the issuance of 1,368 shares of Series A Preferred Stock to Frank Horkey in exchange for the cancellation of $239,571 of related-party notes and accrued interest previously recorded as a stock subscription liability as of June 30, 2025. The Board also approved the issuance of 1,107 shares of Series A Preferred Stock to Timothy Ruggiero (or his assigns) in exchange for the cancellation of $193,654 of related-party notes and accrued interest previously recorded as a stock subscription liability as of June 30, 2025.

 

 
8

Table of Contents

 

Item 3. Defaults upon Senior Securities.

 

None

 

Item 4. Mine Safety Disclosures.

 

Not Applicable.

 

Item 5. Other Information.

 

None.

 

Item 6. Exhibits.

 

The exhibit listed on the Exhibit Index (following the signatures section of this Quarterly Report on Form 10-Q for the three months ended September 30, 2025) are filed herewith or incorporated herein by reference.

 

Exhibit No.

 

Description

 

3.1

 

Articles of Incorporation incorporated by reference to Exhibit 3.1 of our Registration Statement on Form S-1 filed on July 25, 2008

3.3

 

Bylaws, incorporated by reference to Exhibit 3.3 of our Registration Statement on Form S-1/A filed on August 31, 2022

31.1

 

Certification of Principal Executive Officer and Principal Financial Officer Required By Rule 13a-14(A) of the Securities Exchange Act of 1934, As Amended, As Adopted Pursuant To Section 302 of the Sarbanes-Oxley Act of 2002*

32.1

 

Certification of Principal Executive Officer and Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

101.INS

 

Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)**

101.SCH

 

Inline XBRL Taxonomy Schema**

101.CAL

 

Inline XBRL Taxonomy Calculation Link base**

101.DEF

 

Inline XBRL Taxonomy Definition Linkbase**

101.LAB

 

Inline XBRL Taxonomy Label Linkbase**

101.PRE

 

Inline XBRL Taxonomy Presentation Linkbase**

104

 

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

_____________

* Filed herewith.

 

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 
9

Table of Contents

  

SIGNATURES

 

Pursuant to 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.

 

 

T-REX Acquisition Corp.

a Nevada corporation

 

Date: February 23, 2026

By:

/s/ Frank Horkey

 

Frank Horkey

 

Its:

Chief Financial Officer

 

Date: February 23, 2026

By:

/s/ Matthew Cohen

 

Matthew Cohen

 

Its:

Chief Executive Officer

 

In accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

Date: February 23, 2026

By:

/s/ Frank Horkey

 

Frank Horkey

 

Its:

Chief Financial Officer

 

 
10

 

Source: View Original Filing on SEC EDGAR

FAQ

How did T-REX Acquisition Corp. (TRXA) perform for the six months ended December 31, 2025?

T-REX Acquisition Corp. reported minimal revenue of $11,389 and a net loss of $1,410,116 for the six months ended December 31, 2025. High operating expenses, interest costs, and derivative losses outweighed its small Bitcoin mining and hosting revenues, leading to a significant stockholders’ deficit.

What liquidity position does T-REX Acquisition Corp. (TRXA) report in its December 31, 2025 10-Q?

As of December 31, 2025, T-REX Acquisition Corp. held only $1,759 in cash, with a working capital deficit of $2,100,806. Current liabilities of over $2.1 million far exceeded current assets of roughly $12,486, highlighting tight liquidity and reliance on external financing.

What going concern risks does T-REX Acquisition Corp. (TRXA) disclose?

The company acknowledges substantial doubt about its ability to continue as a going concern. It cites recurring losses, a $10,969,465 accumulated deficit, a $1,433,037 stockholders’ deficit, minimal cash, and dependence on raising additional capital through public or private offerings to sustain operations.

What is the status of T-REX Acquisition Corp.’s Orofino, Idaho facility debt?

The Orofino facility is encumbered by a $267,555 note increased by a $40,133 late charge to a $307,688 senior lien, which is in default with a Notice of Default and foreclosure proceedings filed. A related-party note of $207,630 is secured by a junior lien on the same property.

How large are T-REX Acquisition Corp. (TRXA)’s derivative liabilities and convertible-related exposures?

Derivative liabilities tied to convertible note features totaled $433,864 at December 31, 2025, sharply higher than $34,597 at June 30, 2025. This reflects multiple secured convertible promissory notes with conversion prices around $0.50 per share and significant associated stock and warrant inducements.

What are the main revenue sources for T-REX Acquisition Corp. (TRXA)?

Revenue currently comes primarily from Bitcoin mining and limited hosting services. For the period ended December 31, 2025, mining generated $10,163, realized Bitcoin gains were $1,226, and hosting revenue was $0. Management also describes planned software services and modular infrastructure businesses.
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TRXA Latest News

Jan 8, 2026
T-REX Acquisition Corp Partners with FMW Media Works LLC as its Public Relations and Media Expert
May 12, 2025
T-REX Acquisition Corp. Announces Uplisting to OTCQB Venture Market Trading
Apr 1, 2025
T-REX Acquisition Corp. Completes Asset Acquisition of Baoblock Inc.
Mar 11, 2025
T-REX Acquisition Corp. Completes Asset Acquisition of Peak Digital Solutions LLC
Sep 20, 2022
SEC Declares S1 Registration Statement for T-REX Acquisition Corp. Effective

TRXA Latest SEC Filings

Feb 23, 2026
[NT 10-Q] T-REX Acquisition Corp. SEC Filing
Jan 8, 2026
[8-K] T-REX Acquisition Corp. Reports Material Event
Jan 7, 2026
[8-K] T-REX Acquisition Corp. Reports Material Event
Dec 10, 2025
[8-K] T-REX Acquisition Corp. Reports Material Event
Nov 28, 2025
[10-Q] T-REX Acquisition Corp. Quarterly Earnings Report

TRXA Stock Data

16.48M
21.20M
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