ProCap Financial, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Based on an evaluation under the supervision and with the participation of the Company’s management, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were not effective as of December 31, 2025. Management’s Annual Report on Internal Control Over Financial Reporting Management is responsible for establishing and maintaining adequate internal control over our financial reporting (“ICFR”). To evaluate the effectiveness of the Company’s ICFR, as required by Section 404 of the Sarbanes-Oxley Act of 2002, management conducted an assessment, including testing, based on the criteria set forth in the updated Internal Control-Integrated Framework, issued in 2013 by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). The company’s ICFR is designed 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 (“GAAP”). Based on this assessment, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s ICFR was not effective as of December 31, 2025 due to a material weakness in internal control over financial reporting related to (i) inadequate segregation of duties and effective risk assessment, and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both GAAP and SEC guidelines. A material weakness is a deficiency, or a combination of deficiencies, in ICFR such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements would not be prevented or detected on a timely basis. Because of its inherent limitations, ICFR may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate. This Annual Report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of the company’s registered public accounting firm due to a transition period established by rules of the SEC for newly public companies. Remediation Plan for Material Weakness The Company, with oversight from our Audit Committee, is in the process of developing and implementing its remediation plan specific to the material weakness, which is expected to include the adequate segregation of duties, effective risk assessment and implementation of written policies and procedures for accounting and financial reporting. However, the material weakness will not be considered remediated until the applicable remedial controls operate for a sufficient period of time, and management has concluded, through testing, that the related controls are operating effectively. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting (as such term is defined in the Exchange Act) that occurred during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION. During the three-months ended December 31, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS. Not applicable. - 80 - PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. The information required by this item will be included in our Definitive Proxy Statement for the 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2025, and is incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION. The information required by this item will be included in our Definitive Proxy Statement for the 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2025, and is incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. The information required by this item will be included in our Definitive Proxy Statement for the 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2025, and is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. The information required by this item will be included in our Definitive Proxy Statement for the 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2025, and is incorporated herein by reference. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. The information required by this item will be included in our Definitive Proxy Statement for the 2026 Annual Meeting of Stockholders to be filed with the SEC within 120 days of the fiscal year ended December 31, 2025, and is incorporated herein by reference. - 81 - PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a)(1) Financial Statements The following Report and Consolidated Financial Statements of our Company are included in this Annual Report: Report of Independent Registered Public Accounting Firm (PCAOB ID No. 206) Consolidated Balance Sheet Consolidated Statement of Operations Consolidated Statement of Changes in Stockholders’ Equity Consolidated Statement of Cash Flows Notes to Consolidated Financial Statements See Index to Consolidated Financial Statements on page F-1 of this Annual Report, incorporated into this item by reference. (a)(2) Financial Statement Schedules All financial statement schedules have been omitted as the information is not required under the related instructions or is not applicable or because the information required is already included in the financial statements or the notes to those financial statements. (a)(3) Exhibits List of Exhibits required by Item 601 of Regulation S-K. See part (b) below. - 82 - (b) Exhibits The following exhibits listed in the accompanying index to exhibits are filed, furnished, or incorporated by reference as part of this Annual Report on Form 10-K. No. Description of Exhibit 2.1† Business Combination Agreement, dated as of June 23, 2025, by and among CCCM, the Company, ProCap, SPAC Merger Sub, Company Merger Sub and Professional Capital Management (incorporated by reference to Exhibit 2.1 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 2.2 First Amendment to the Business Combination Agreement, dated as of July 28, 2025, by and among CCCM, the Company, ProCap, SPAC Merger Sub, Company Merger Sub and Professional Capital Management (incorporated by reference to Exhibit 2.1 to CCCM’s Current Report on Form 8-K, filed with the SEC on July 28, 2025). 2.3†** Agreement and Plan of Merger, dated as of February 9, 2026, by and among the Company, Silvia Merger Sub, Inc., CFO Silvia, Inc, Inflection Points Inc, Shain Noor, and Shain Noor as Stockholder Representative (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 3.1 Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). 3.2 Amended and Restated By-Laws of the Company (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). 4.1* Description of Capital Stock. 4.2 Warrant Agreement, dated May 15, 2025, by and between CCCM and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.1 to CCCM’s Current Report on Form 8-K, filed with the SEC on May 20, 2025). 4.3 Warrant Assignment, Assumption and Amendment Agreement, dated December 5, 2025, by and among Continental Stock Transfer & Trust Company, as Public Warrant agent, CCCM and the Company (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). 4.4 Specimen Warrant Certificate of the Company (incorporated by reference to Exhibit 4.5 to Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on October 20, 2025). 4.5* Indenture, dated as of December 5, 2025, by and among ProCap, the Guarantors listed therein and U.S. Bank Trust Company, National Association. 10.1 Amended and Restated Registration Rights Agreement dated as of December 5, 2025, by and among CCCM, Pubco, the Sponsor, and the other parties thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). 10.2 Amendment to Insider Letter Agreement, dated as of December 5, 2025, by and among ProCap, CCCM, the Company and the directors and officers of CCCM named therein (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). 10.3 Form of Indemnity Agreement (incorporated by reference to Exhibit 10.18 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on September 18, 2025). 10.4† Form of Convertible Note Subscription Agreement by and among ProCap, the Company, CCCM, and the subscribers thereto (incorporated by reference to Exhibit 10.7 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.5 Sponsor Support Agreement, dated as of June 23, 2025, by and among CCCM, the Sponsor, and the Company (incorporated by reference to Exhibit 10.1 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.6 Lock-Up Agreement, dated as of June 23, 2025, by and between Professional Capital Management and the Company (incorporated by reference to Exhibit 10.2 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.7 Non-Competition Agreement, dated as of June 23, 2025, by and among CCCM, ProCap, the Company and Anthony Pompliano (incorporated by reference to Exhibit 10.3 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.8 Voting and Support Agreement, dated as of June 23, 2025, by and among Professional Capital Management, ProCap and the Company (incorporated by reference to Exhibit 10.4 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.9 Company 2025 Equity Incentive Plan (incorporated by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). - 83 - 10.10* Company Collateral Agreement, dated as of December 5, 2025, by and among the Grantors listed therein and U.S. Bank Trust Company, National Association. 10.11 Services Agreement, dated as of June 23, 2025, by and between Professional Capital Management and ProCap (incorporated by reference to Exhibit 10.5 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.12† Form of Preferred Equity Subscription Agreement, dated as of June 23, 2025, by and among ProCap, Pubco, CCCM, and certain subscribers party thereto (incorporated by reference to Exhibit 10.6 to CCCM’s Current Report on Form 8-K, filed with the SEC on June 27, 2025). 10.13+ Employment Agreement effective as of July 25, 2025, by and between ProCap and Jeffrey Park (incorporated by reference to Exhibit 10.23 to Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on October 20, 2025). 10.14+ Amended and Restated Employment Agreement effective as of October 1, 2025, by and between ProCap and Kyle Wood (incorporated by reference to Exhibit 10.24 to Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on October 20, 2025). 10.15+ Employment Agreement effective as of August 25, 2025, by and between ProCap and Megan Pacchia (incorporated by reference to Exhibit 10.25 to Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on October 20, 2025). 10.16+ Employment Agreement effective as of October 17, 2025, by and between ProCap and Anthony Pompliano (incorporated by reference to Exhibit 10.26 to Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on October 20, 2025). 10.17+ Employment Agreement effective as of October 15, 2025, by and between ProCap and Renae Cormier (incorporated by reference to Exhibit 10.27 to Amendment No. 1 to the Registration Statement on Form S-4 (File No. 333-290365), filed by the Company on October 20, 2025). 10.18 Sponsor Earnout Agreement, by and among CCCM, ProCap, the Company and Sponsor (incorporated by reference to Exhibit 10.1 to CCCM’s Current Report on Form 8-K, filed with the SEC on December 5, 2025). 10.19 Seller Earnout Agreement, by and among CCCM, ProCap, the Company and Seller (incorporated by reference to Exhibit 10.2 to CCCM’s Current Report on Form 8-K, filed with the SEC on December 5, 2025). 10.20 Form of Registration Rights Agreement, by and among the Company and the Holders (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 10.21** Form of Lock-Up Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 10.22 Form of SAFE Termination Agreement (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 10.23†** Form of Notes Repurchase Agreement (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 10.24+ Form of Employment Agreement, by and among the Company and Shain Noor (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 10.25+** Form of Non-Competition and Non-Solicitation Agreement, by and between the Company and Shain Noor (incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2026). 14.1 Company’s Code of Business Conduct and Ethics (incorporated by reference to Exhibit 14.1 to the Company’s Current Report on Form 8-K, filed with the SEC on December 11, 2025). 19.1* Insider Trading Policy. 21.1* List of Subsidiaries of the Company. 23.1* Consent of MaloneBailey, LLP independent registered public accounting firm for ProCap Financial, Inc. 31.1* Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1* Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2* Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97.1* Policy Relating to Recovery of Erroneously Awarded Compensation 101.INS* Inline XBRL Instance Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* Inline XBRL Taxonomy Extension Labels Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104* Inline XBRL for the cover page of this Annual Report on Form 10-K, included in the Exhibit 101 Inline XBRL Document Set. † Schedules and exhibits to this Exhibit omitted pursuant to Regulation S-K Item 601(a)(5). The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. + Indicates management contract or compensatory plan. * Filed herewith **Indicates certain portions of this document that constitute confidential information have been redacted in accordance with Regulation S-K, Item 601(b)(2) or (10). ITEM 16. FORM 10-K SUMMARY None. - 84 - SIGNATURES Pursuant to the requirements of Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. PROCAP FINANCIAL, INC. Date: February 18, 2026 /s/ Anthony Pompliano Name: Anthony Pompliano Title: Chief Executive Officer and Chairman Date: February 18, 2026 /s/ Renae Cormier Name: Renae Cormier Title: Chief Financial Officer Date: February 18, 2026 /s/ Eric Jackson Name: Eric Jackson Title: Director Date: February 18, 2026 /s/ Bill Koutsouras Name: Bill Koutsouras Title: Director Date: February 18, 2026 /s/ Gary Quin Name: Gary Quin Title: Director - 85 - PROCAP FINANCIAL, INC. CONSOLIDATED FINANCIAL STATEMENTS (Audited) AS OF DECEMBER 31, 2025 AND FOR THE PERIOD FROM JUNE 17, 2025 (INCEPTION) THROUGH DECEMBER 31, 2025 F- 1 PROCAP FINANCIAL, INC. INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS PAGE Report of Independent Registered Public Accounting Firm (PCAOB ID 206 ) F-3 Consolidated Balance Sheet as of December 31, 2025 F-4 Consolidated Statement of Operations for the period from June 17, 2025 (inception) through December 31, 2025 F-5 Consolidated Statement of Changes in Stockholders’ Equity for the period from June 17, 2025 (inception) through December 31, 2025 F-6 Consolidated Statement of Cash Flows for the period from June 17, 2025 (inception) through December 31, 2025 F-7 Notes to Consolidated Financial Statements F-8 F- 2 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of ProCap Financial, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of ProCap Financial, Inc. and its subsidiaries (collectively, the “Company”) as of December 31, 2025, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. /s/ MaloneBailey, LLP www.malonebailey.com We have served as the Company’s auditor since 2025. Houston, Texas February 18, 2026 F- 3 PROCAP FINANCIAL, INC. CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2025 December 31, 2025 ASSETS Current assets Cash $ 19,973,574 Cash equivalents 25,002,553 Restricted cash 149,885,332 Accounts receivable 45,000 Prepaid expenses, current 1,863,216 Other current assets 257,389 Total current assets 197,027,064 Digital assets 441,791,316 Fixed assets, net 52,113 Prepaid expenses, non-current 16,250 TOTAL ASSETS $ 638,886,743 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Accounts payable and accrued expenses $ 1,829,984 Derivative securities liabilities 428,236 Deferred revenue 1,000 Total current liabilities 2,259,220 Long-term liabilities Conversion feature liability - convertible notes 2,278,940 Convertible Notes, net 214,171,908 TOTAL LIABILITIES 218,710,068 STOCKHOLDERS’ EQUITY Preferred stock; 50,000,000 authorized shares; no shares issued and outstanding as of December 31, 2025 - Common stock; $ 0.001 par value, 550,000,000 authorized shares; 85,166,604 shares issued and 84,327,208 shares outstanding as of December 31, 2025 85,167 Additional paid-in capital 451,913,639 Treasury stock, at cost, 839,396 shares ( 2,846,627 ) Accumulated deficit ( 28,975,504 ) Total stockholders’ equity 420,176,675 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 638,886,743 The accompanying notes are an integral part of these consolidated financial statements. F- 4 PROCAP FINANCIAL INC. CONSOLIDATED STATEMENT OF OPERATIONS For the period from June 17, 2025 (inception) through December 31, 2025 Revenue $ 85,000 Operating expenses General and administrative 7,630,335 Stock-based compensation 442,043 Loss from operations ( 7,987,378 ) Other income (expense): Realized loss on sale of digital assets ( 54,463,684 ) Change in fair value of digital assets ( 25,005,384 ) Change in fair value of conversion feature - preferred units 56,298,500 Change in fair value of convertible note conversion feature 2,350,290 Change in fair value of derivative securities 106,264 Interest income 259,942 Interest expense ( 534,054 ) Other expense, net ( 20,988,126 ) Net loss $ ( 28,975,504 ) Weighted average number of shares of common stock outstanding, basic and diluted 73,685,031 Net loss per common stock, basic and diluted $ ( 0.39 ) The accompanying notes are an integral part of these consolidated financial statements. F- 5 PROCAP FINANCIAL, INC. CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE PERIOD FROM JUNE 17, 2025 (INCEPTION) THROUGH DECEMBER 31, 2025 Preferred Stock Common Stock Treasury Stock Additional Paid-in Accumulated Total Stockholders’ Shares Amount Shares Amount Shares Amount Capital Deficit Equity Balance, June 17, 2025 (inception) - $ - - $ - - $ - $ - $ - $ - Issuance of common units pursuant to the Investment Consulting and Marketing Services Agreement, as recasted - - 10,000,000 10,000 - - ( 10,000 ) - - Sale of preferred units, net of equity issuance costs, as recasted - - 63,500,000 63,500 - - 487,443,979 - 487,507,479 Sale of preferred units, net of equity of issuance costs, related party, as recasted - - 1,062,500 1,063 - - 8,156,050 - 8,157,113 Issuance of stock upon consummation of the Business Combination - - 10,604,104 10,604 - - 12,180,067 - 12,190,671 Conversion of preferred units to common stock at carrying amount - - - - - - ( 56,298,500 ) - ( 56,298,500 ) Stock-based compensation - - - - - - 442,043 - 442,043 Purchase of treasury stock - - - ( 839,396 ) ( 2,846,627 ) - - ( 2,846,627 ) Net loss - - - - - - - ( 28,975,504 ) ( 28,975,504 ) Balance, December 31, 2025 - $ - 85,166,604 $ 85,167 ( 839,396 ) $ ( 2,846,627 ) $ 451,913,639 $ ( 28,975,504 ) $ 420,176,675 The accompanying notes are an integral part of these consolidated financial statements. F- 6 PROCAP FINANCIAL, INC. CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE PERIOD FROM JUNE 17, 2025 (INCEPTION) THROUGH DECEMBER 31, 2025 For the period from June 17, 2025 (inception) through December 31, 2025 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ ( 28,975,504 ) Adjustments to reconcile net loss to net cash used in operations: Change in fair value of digital assets 25,005,384 Change in fair value of derivative securities liability ( 106,264 ) Change in fair value of conversion feature -preferred units ( 56,298,500 ) Change in fair value of convertible note conversion feature ( 2,350,290 ) Realized loss on sale of digital assets 54,463,684 Stock based compensation 442,043 Depreciation 32,469 Amortization of discount and debt issuance costs on Convertible Notes 534,054 Changes in operating assets and liabilities: Accounts receivable ( 45,000 ) Prepaid expenses ( 1,879,466 ) Other current assets ( 257,389 ) Accounts payable and accrued expenses 1,829,984 Deferred revenue 1,000 Due to related party 111,981 CASH USED IN OPERATING ACTIVITIES ( 7,491,814 ) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of digital assets ( 983,296,700 ) Proceeds from sale of digital assets 462,036,316 Purchase of fixed assets ( 84,582 ) CASH USED IN INVESTING ACTIVITIES ( 521,344,966 ) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from promissory note, related party 1,777,581 Payments of promissory note, related party ( 1,889,562 ) Proceeds from Convertible Notes, net of debt discount 227,950,000 Payment of debt issuance costs ( 9,682,916 ) Proceeds from derivative securities 534,500 Proceeds from reverse recapitalization, net 12,190,671 Purchase of treasury stock ( 2,846,627 ) Proceeds from sale of preferred units, net 487,507,479 Proceeds from sale of preferred units by related party 8,157,113 CASH PROVIDED BY FINANCING ACTIVITIES 723,698,239 NET CHANGE IN CASH AND RESTRICTED CASH 194,861,459 Cash, cash equivalents and restricted cash, beginning of period - Cash, cash equivalents and restricted cash, end of period $ 194,861,459 Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheet: Cash $ 19,973,574 Cash equivalents 25,002,553 Restricted cash 149,885,332 Total cash, cash equivalents, and restricted cash $ 194,861,459 Supplemental disclosure of non-cash activities: Conversion of due to related party to a promissory note, related party $ 111,981 Initial recognition of conversion feature liability - convertible notes $ 4,629,230 Conversion of preferred units to common stock $ 56,298,500 Issuance of common units pursuant to the Investment Consulting and Marketing Services Agreement, as recasted $ 10,000 The accompanying notes are an integral part of these consolidated financial statements. F- 7 PROCAP FINANCIAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD FROM JUNE 17, 2025 (INCEPTION) THROUGH DECEMBER 31, 2025 Note 1. Organization Description of Business Procap Financial, Inc, together with its subsidiaries (collectively, the “Company” or “ProCap” or “Pubco”), formerly known as Columbus Circle Capital Corp I (“CCCM”), was incorporated in Delaware on June 17, 2025. The Company has two wholly owned subsidiaries, ProCap BTC, LLC and Columbus Circle Capital Corp I. The Company holds Bitcoin as its primary treasury reserve asset. On December 5, 2025, the Company completed the business combination (the “Business Combination”) contemplated by the business combination agreement (the “Business Combination Agreement” and, together with the convertible note financing, the “Transactions”) by and among CCCM, ProCap, Crius SPAC Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of the Company (“SPAC Merger Sub”), Crius Merger Sub, LLC, a Delaware limited liability company and a wholly owned subsidiary of the Company (“Company Merger Sub”), ProCap BTC, LLC, a Delaware limited liability company (“ProCap BTC”) and Inflection Points Inc d/b/a Professional Capital Management, a Delaware corporation (the “Seller”). The Business Combination was accounted for as a reverse recapitalization in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). Under this method of accounting, although CCCM acquired the outstanding equity of the Company in the Business Combination, CCCM was treated as the “acquired company” and ProCap was treated as the accounting acquirer for financial statement purposes. Accordingly, the Business Combination was treated as the equivalent of ProCap issuing stock for the net assets of CCCM, accompanied by a recapitalization. The net assets of CCCM are stated at historical cost, with no goodwill or other intangible assets recorded. Furthermore, the historical financial statements of ProCap became the historical financial statements of the Company upon the consummation of the merger. As a result, the financial statements included in this Annual Report reflect (i) the historical operating results of ProCap and Procap BTC prior to the merger; (ii) the combined results of CCCM and ProCap following the close of the merger; (iii) the assets and liabilities of CCCM at their historical cost and (iv) ProCap’s equity structure for all periods presented, as affected by the recapitalization presentation after completion of the merger. See Note 4 - Recapitalization for further details of the merger. Note 2. Liquidity and Capital Resources As of December 31, 2025, the Company had $ 44,976,127 in cash and cash equivalents, $ 149,885,332 in restricted cash and working capital of $ 194,767,844 . Restricted cash primarily relates to collateral requirements under the Company’s convertible notes and written Bitcoin put option contracts. For the period from June 17, 2025 (inception) through December 31, 2025, the Company reported a net loss of $ 28,975,504 . This net loss was primarily driven by factors that are inherently volatile and subject to market conditions, including: ● Realized and unrealized losses related to Bitcoin holdings due to fluctuations in the market price of Bitcoin; ● General and administrative expenses associated with the business combination and operating as a public company. F- 8 Because digital assets and derivative instruments are measured at fair value, the Company’s results of operations may fluctuate significantly from period to period, as discussed further in Note 11. On December 5, 2025, the Company completed the Business Combination and issued convertible notes in the aggregate principal amount of $ 235,000,000 for an aggregate purchase price equal to 97 % of the aggregate principal amount of the convertible notes (See Note 8). Based on the cash and cash equivalents balance of $ 44,976,127 , and the Company’s Bitcoin holdings, the Company has determined that the Company’s sources of liquidity will be sufficient to meet the Company’s needs for the one-year period from the issuance of the consolidated financial statements. Note 3. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements reflect all adjustments including normal recurring adjustments, which, in the opinion of the Company’s management, are necessary to present fairly the financial position, results of operations, and cash flows for the period presented in accordance with GAAP. References to GAAP issued by the Financial Accounting Standards Board (“FASB”) in these accompanying notes to the consolidated financial statements are to the FASB Accounting Standards Codification (“ASC”). References in the accompanying notes to accounting guidance issued by FASB are to the FASB Accounting Standards Codification (“ASC”). As this is the Company’s first annual reporting period, there are no prior-period consolidated financial statements for comparison. The consolidated financial statements include all information and disclosures required by U.S. GAAP for a complete set of annual financial statements. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Procap Financial, Inc. and the Company’s wholly owned subsidiaries. All intercompany transactions have been eliminated upon consolidation of these entities. Use of Estimates The preparation of the accompanying financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts and disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate is the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which could change in the near term due to one or more future confirming events. Significant accounting estimates include valuations of derivative liabilities and the valuations of share-based awards. Accordingly, the actual results could differ significantly from those estimates. Segment Information ASC 280, “Segment Reporting” (“ASC 280”), defines operating segments as components of an enterprise where discrete financial information is available that is evaluated regularly by the chief operating decision-maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company operates as a single operating segment. The Company’s CODM is the Chief Executive Officer, who has ultimate responsibility for the operating performance of the Company and the allocation of resources. The CODM uses cash flows as the primary measure to manage the business and does not segment the business for internal reporting or decision making. F- 9 Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents, restricted cash, and Bitcoin. The Company maintains its cash, cash equivalents, restricted cash and Bitcoin with major financial institutions and reputed Bitcoin custodians. The Company’s cash consists of accounts held within financial institutions which, at times, may exceed federally insured limits. The cash balance in excess of the federally insured limits was $ 144,989,552 as of December 31, 2025. Accounts held through Bitcoin custodians, Anchorage Digital Bank and Bitgo Trust Company, which totaled $ 24,430,101 , and cash equivalents money market treasury funds, which totaled $ 25,002,553 , are not insured by the Federal Deposit Insurance Corporation. Our Bitcoin is held offline in cold storage with multiple third-party providers. As of December 31, 2025 approximately 50% of our Bitcoin was held at Anchorage Digital Bank and approximately 50% of our Bitcoin was held at Bitgo Trust Company. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity date of three months or less when purchased to be cash equivalents. Restricted Cash The Company classifies cash as restricted cash when it is held in a separate bank account and its withdrawal or general use is legally restricted, or when a portion of cash is designated as collateral. The Company had restricted cash of $ 149,885,332 as of December 31, 2025, which represented $ 145,239,552 set aside as collateral for the Convertible Notes (as defined in Note 8) and $ 4,645,780 required to be set aside as collateral for the derivative security, refer to Note 14 for additional information. Fixed Assets, net Property, plant and equipment is stated at cost, less accumulated depreciation. Betterments, renewals, and extraordinary repairs that materially extend the useful life of the asset are capitalized; other repairs and maintenance charges are expensed as incurred. The Company includes equipment, furniture and fixtures, and leasehold improvements in the fixed assets. The Company’s depreciation expense is calculated using the straight-line method over the estimated useful lives of the related assets, which results in depreciation being incurred evenly over the life of an asset. Fully depreciated assets are retained in property and accumulated depreciation accounts until they are removed from service. Prepaid Expenses The Company includes in prepaid expenses payments made in advance for goods and services for which the Company will receive a future benefit. Prepaid expenses are recorded at cost and are expensed over the period in which the benefit is realized. Fair value measurement The Company’s financial assets and liabilities are accounted for in accordance with FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels: Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities. F- 10 Level 2 — Observable, market-based inputs, other than quoted prices included in Level 1, for the assets or liabilities either directly or indirectly. Level 3 — Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation. In some cases, the inputs used to measure an asset or a liability may fall into different levels of the fair value hierarchy. In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment. Digital assets As a result of the adoption of ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”), the Company accounts for its qualifying crypto assets within the scope of ASC 350-60. Accordingly, such crypto assets are measured at fair value at each reporting date. The fair value of the Company’s digital assets is determined using the period-end closing price quoted on Coinbase, an active market, in accordance with ASC 820, Fair Value Measurement. Because digital asset markets operate on a continuous, 24-hour basis, the Company uses the price as of midnight Coordinated Universal Time (UTC) as of the reporting date. Quoted prices for identical digital assets in active markets represent Level 1 inputs in the fair value hierarchy. Changes in the fair value of digital assets are recognized in change in fair value of digital assets within other income (loss) in the consolidated statement of operations. When the Company sells digital assets, realized gains or losses are measured as the difference between the cash proceeds received and the carrying value of the digital assets sold, as determined using the first-in, first-out (“FIFO”) method. Realized gains and losses are recorded in realized gain or loss on sale of digital assets in the consolidated statement of operations. The Company’s current treasury strategy is to retain Bitcoin as its primary treasury reserve asset. Based on this strategy, the Company classifies its digital assets as non-current assets on the consolidated balance sheet. As of December 31, 2025, the Company held its Bitcoin with third-party custodians, consisting of approximately 2,500 Bitcoin held with Anchorage Digital Bank, N.A. and approximately 2,500 Bitcoin held with BitGo Trust Company, Inc. The Company retains control over the underlying digital assets held with these custodians. The Company has entered into derivative contracts, including Bitcoin selling put option contracts, as part of a broader Bitcoin treasury and income generating strategy to manage exposure to fluctuations in the market price of Bitcoin or for trading purposes. The put options sold provide the right to buy Bitcoin at a specified strike price on a stated maturity date. The contracts to date have been exchange-traded and may be cash-settled or physically settled. These instruments are accounted for separately as derivatives and are not considered digital assets. Gains and losses related to the derivative contracts are recognized in other income (expense) on the consolidated statement of operations. F- 11 Accounts Payable and Accrued Expenses The Company’s payables and accrued expenses result primarily from the administration of the Company. The Company records accounts payable upon receipt of a vendor invoice. Accrued expenses are recognized when incurred, not when paid, to accurately reflect expenses within the period they relate to, ensuring proper matching under accrual basis accounting. Derivative Liabilities The Company evaluates all its financial instruments to determine if such instruments contain features that qualify as embedded derivatives per ASC 815, Derivatives and Hedging (“ASC 815”). The preferred units issued prior to the Business Combination contain certain features that meet the definition of an embedded derivative requiring bifurcation as a separate compound financial instrument (the “Derivative Liability”). The Derivative Liability was recorded at fair value upon entering into the LLC Agreement and was subsequently remeasured to fair value at each reporting period with the corresponding change in fair value recognized in Change in fair value of conversion feature - preferred units in the consolidated statement of operations. The conversion feature was initially valued and was remeasured using Black-Scholes pricing model. The Black-Scholes model requires the use of Level 3 unobservable inputs, primarily the current value of the underlying share, the exercise price of the option, and the estimated volatility of the value of the share over the life of the option. The Convertible Notes contain a conversion feature that must be bifurcated and accounted for as a derivative instrument (the “Derivative Liability”) (See Note 8). The Derivative Liability was recorded at fair value upon the issuance of the Convertible Notes and is to be subsequently remeasures to fair value at each reporting period recognized in Change in fair value of convertible note conversion feature in the consolidated statement of operations. The Derivative Liability was initially valued and is remeasured using a Black-Scholes option pricing model. The Black-Scholes option pricing model requires the use of Level 3 unobservable inputs, primarily the current value of the underlying share and the Bitcoin price volatility. Refer to Note 11 “Fair Value Measurements” for details regarding the fair values. Revenue Recognition Policy The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ ASC 606 ”). Revenue is recognized when control of promised services is transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services. The Company typically provides advertising and marketing services through weekly digital media placements, including audio, and social media advertisements. Revenue is recognized over time, as the customer simultaneously receives and consumes the benefits of the services as they are performed (ASC 606-10-25-27(a)). For contracts in which services are provided evenly over the term of the arrangement, the Company applies a time-elapsed (straight-line) measure of progress, as this method best reflects the pattern of satisfaction of the performance obligation. Customer payments are typically due upfront or within 30 days of service commencement. Amounts invoiced and cash received upfront, but not yet earned are recorded as deferred revenue until the related services are performed. Management evaluates all contracts to determine performance obligations, transaction price, variable consideration (if any), and the existence of any significant financing components. The Company does not typically incur incremental costs to obtain contracts; therefore, no contract costs are capitalized under ASC 340-40. F- 12 Accounts Receivable Accounts receivable represents amounts due from customers for services sold in the ordinary course of business and are initially recorded at the original invoice amount. Receivables are reported at net realizable value, net of an allowance for credit losses. The allowance is estimated using historical collection data, with uncollectible amounts written off when deemed uncollectable. The Company had accounts receivable of $ 45,000 as of December 31, 2025, and no recorded allowance for credit losses. As of December 31, 2025, amounts due from one customer make up the total of accounts receivable. Warrants The Company determines the accounting classification of warrants it issues as either liability or equity classified by first assessing whether the warrants meet liability classification in accordance with ASC 480, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity ( “ASC 480”), then in accordance with ASC 815, Derivatives and Hedging (“ASC 815”). Accordingly, the Company evaluated and classified the warrant instruments under equity treatment at their assigned values. There were no changes in the number of warrants issued and outstanding as of December 31, 2025 there are 12,500,000 Public Warrants and 352,500 Private Placement Warrants outstanding. Convertible Debt When the Company issues convertible debt, it first evaluates the balance sheet classification of the convertible instrument in its entirety to determine (1) whether the instrument should be classified as a liability under ASC 480, and (2) whether the conversion feature should be accounted for separately from the host instrument. A conversion feature of a convertible debt instrument would be separated from the convertible instrument and classified as a derivative liability if the conversion feature, were it a standalone instrument, meets the definition of a derivative under ASC 815. When a conversion feature meets the definition of an embedded derivative, it would be separated from the host instrument and classified as a derivative liability carried on the consolidated balance sheet at fair value, with any changes in its fair value recognized in the consolidated statement of operations. The Company records the Convertible Notes as a long-term liability at face value net of debt discount and debt issuance costs. If any of the conditions to the convertibility of the Convertible Notes are satisfied, or the Convertible Notes become due within one year, then the Company may be required under applicable accounting standards to reclassify the carrying value of the Convertible Notes as a current liability. Debt issuance costs related to the Convertible Notes were capitalized and recorded as a contra-liability and are presented net against the balance of the Convertible Notes on the consolidated balance sheet. Debt issuance costs consist of underwriting, legal and other direct costs related to the issuance of the Convertible Notes. The debt discount related to the Convertible Notes was capitalized and recorded as a contra-liability and is presented net against the balance of the Convertible Notes on the consolidated balance sheet. Debt issuance costs and debt discount are amortized to interest expense over the term of the Convertible Notes using the straight-line method which approximated the effective interest method using an effective interest rate of approximately 9.0 %. Stock-based Compensation The Company accounts for its stock-based compensation awards in accordance with ASC 718, Compensation - Stock Compensation (“ASC 718”). ASC 718 requires companies to measure the cost of employee and non-employee services received in exchange for an award of an equity instrument to be recognized as expense in the statement of operations based on their grant award date fair values. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period. F- 13 Net Loss Per Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, “Earnings Per Share” which requires presentation of basic and diluted earnings per share (“EPS”) on the face of the statement of operations for all entities with complex capital structures and requires a reconciliation of the numerator and the denominator of the basic EPS computation to the numerator and denominator of the diluted EPS. Basic net loss per share is computed by dividing net loss by the weighted average number of common stock outstanding for the period. It excludes the dilutive effects of any potentially issuable common shares. Diluted net loss per share is calculated by including any potentially dilutive share issuance in the denominator. For the period from June 17, 2025 (inception) through December 31, 2025, all potentially dilutive securities were not included in the calculation of diluted net loss per share as their effect would be anti-dilutive. The computation of basic and dilutive net loss per share for the period from June 17, 2025 (inception) through December 31, 2025 are as follows: Schedule of Computation of Basic and Dilutive Net Loss Per Share For the period from June 17, 2025 (inception) through December 31, 2025 Numerator: Net loss $ ( 28,975,504 ) Denominator: Weighted average number of shares of common stock outstanding, basic and diluted 73,685,031 Net loss per common stock, basic and diluted $ ( 0.39 ) As of December 31, 2025, common stock equivalents not included in the computation of net loss per share because their effect would be antidilutive included the following: Schedule of Computation of Net Loss Per Common Stock Warrants (see Note 12) 12,852,500 RSUs (see Note 13) 8,220,000 Convertible Notes (see Note 8) 18,071,500 Total 39,144,000 Income taxes The Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. FASB ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and the measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. Treasury Stock The Company accounts for treasury stock using the cost method in accordance with U.S. GAAP. When the Company repurchases its own common stock, the purchase price, including any directly attributable transaction costs, is recorded as treasury stock, a reduction to stockholders’ equity. Treasury shares are not considered outstanding and therefore are excluded from the calculation of earnings per share and dividends. When treasury shares are reissued, the Company uses the average cost of the shares held in treasury to determine the cost basis. Any excess of the reissuance price over the cost of the shares is recorded as an increase to additional paid-in capital. If the reissuance price is below cost, the difference is first charged to additional paid-in capital to the extent of previous net gains from treasury stock transaction; any remaining shortfall is recorded as a reduction to retained earnings. The Company does not recognize gains or losses in the consolidated statement of operations from the purchase, reissuance or retirement of treasury stock. If treasury shares are formally retires, the Company reduces common stock and additional paid-in capital based on the original issuance amounts, with any difference between the carrying amount of the treasury shares and the amounts removed from equity recorded in retained earnings. F- 14 Recent accounting pronouncements Recently Adopted Accounting Pronouncements: ASU 2023-08 — Accounting for and Disclosure of Crypto Assets In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets . ASU 2023-08 requires entities to subsequently measure certain crypto assets at fair value at each reporting date, with changes in fair value recognized in net income. The guidance also requires enhanced disclosures regarding significant crypto asset holdings. The Company adopted ASU 2023-08 effective June 17, 2025. Upon adoption, qualifying digital assets are measured at fair value as of each reporting period. The adoption of ASU 2023-08 did not have a material impact on the Company’s consolidated financial position or cash flows. Recent Accounting Pronouncements, not yet adopted: In November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03, “ Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses ” (“ASU 2024-03”), requiring public entities to disclose additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2024-03. In May 2025, the FASB issued ASU No. 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity . The standard revises current guidance for determining the accounting acquirer for a transaction effected primarily by exchanging equity interests in which the legal acquiree is a variable interest entity (“VIE”) that meets the definition of a business. The amendments differ from current U.S. GAAP because, for certain transactions, they replace the requirement that the primary beneficiary of a VIE is always the acquirer with an assessment that requires an entity to consider the factors to determine which entity is the accounting acquirer. Under the amendments, acquisition transactions in which the legal acquiree is a VIE will, in more instances, result in the same accounting outcomes as economically similar transactions in which the legal acquiree is a voting interest entity. The ASU does not change the accounting for a transaction determined to be a reverse acquisition or a transaction in which the legal acquirer is not a business and is determined to be the accounting acquiree. The new guidance will become effective for interim and annual reporting periods beginning on January 1, 2027, will require a prospective transition method for business combinations that occur after the initial adoption date, and early adoption is permitted. Management is currently evaluating the impact of the new standard on the Company’s consolidated financial statements. The Company’s management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s consolidated financial statements. Note 4. Recapitalization As discussed in Note 1, “Organization,” on December 5, 2025, the Company completed the Business Combination contemplated by the Business Combination Agreement dated June 23, 2025, by and among CCCM, SPAC Merger Sub, Company Merger Sub, ProCap BTC and the Seller, pursuant to which (i) SPAC Merger Sub merged with and into CCCM, with CCCM continuing as the surviving entity (the “SPAC Merger”) and (ii) Company Mer Sub merged with and into ProCap, with ProCap continuing as the surviving company (the “Company Merger”). At the Closing, pursuant to the Business Combination Agreement and after giving effect to the redemption of shares of CCCM ordinary shares: 1. As consideration for the Company Merger, Seller and Jeffrey Park, who were holders of all the common units of ProCap, received 10,000,000 shares of common stock, par value $ 0.001 per share of the Company (“Pubco Stock”) (the “Common Merger Consideration Shares”). As consideration for the Company Merger, holders of the non-voting preferred units of ProCap received an aggregate number of Pubco Stock equal to the product of (A) the number of preferred units outstanding prior to the Company Merger multiplied by (B) 1.25, or 64,562,500 shares. 2. As consideration for the SPAC Merger, holders of shares of CCCM immediately prior to the SPAC Merger received 10,604,104 shares of Pubco Stock (“SPAC Consideration Shares”). Although CCCM was the legal acquirer of ProCap in the merger, ProCap is deemed to be the accounting acquirer, and the historical financial statements of ProCap became the basis for the historical financial statements of the Company upon the closing of the merger. ProCap was determined to be the accounting acquirer based on an evaluation of the following facts and circumstances: ● ProCap’s current shareholders will hold a majority of the voting power of the Company post Business Combination; ● The Company Board consists of five individuals, one of which was elected by CCCM and four of which were elected by ProCap; F- 15 ● ProCap’s operations substantially comprise the ongoing operations of the Company; and ● ProCap’s senior management comprises the senior management of the Company. In accordance with the guidance applicable to these circumstances, the equity structure has been restated in all comparable periods up to December 5, 2025, to reflect the number of shares of the Company’s common stock, $ 0.001 par value per share, issued to ProCap’s stockholders in connection with the merger. As such, the shares and corresponding capital amounts and earnings per share related to ProCap’s units prior to the merger have been retroactively restated as shares reflecting the exchange ratio established in the merger. The following table reconciles the elements of the Business Combination to the consolidated statement of changes in stockholders’ equity for the year ended December 31, 2025: Schedule of Business Combination to the Consolidated Statement of Changes in Equity Cash - trust and cash, net of redemptions $ 15,992,015 Less: transaction expenses paid ( 3,790,701 ) Net proceeds from the Business Combination 12,201,314 Assets (liabilities) assumed from the SPAC: Cash 64,357 Accrued offering costs ( 75,000 ) Reverse recapitalization, net $ 12,190,671 The number of shares of Pubco Stock issued immediately following the consummation of the Business Combination were: Schedule of Pubco Stock Issued Columbus Circle Capital Corp I public shares outstanding prior to the Business Combination 25,000,000 Less: Redemption of Columbus Circle Capital Corp I ordinary shares ( 23,434,229 ) Columbus Circle Capital Corp I public shares 1,565,771 Columbus Circle Capital Corp I founder shares outstanding 8,333,333 Columbus Circle Capital Corp I private placement shares outstanding 265,000 Columbus Circle Capital Corp I representative shares outstanding 440,000 Business combination shares – ProCap common shares after conversation ratio 74,562,500 Common stock available immediately after the Business Combination 85,166,604 F- 16 The number of ProCap shares was determined as follows: Schedule of ProCap Shares Details ProCap units ProCap common shares after conversion ratio Common 10,000,000 10,000,000 Preferred 51,650,000 64,562,500 61,650,000 74,562,500 Public and private placement warrants The 12,500,000 public warrants issued at the time of CCCM’s initial public offering (the “Public Warrants”) and the 352,500 warrants issued in connection with the private placement at the time of CCCM’s initial public offering (the “Private Placement Warrants”) remained outstanding and became warrants for the Company. Redemption Prior to the closing of the Business Combination, certain CCCM shareholders exercised their right to redeem certain of their outstanding shares for cash, resulting in the redemption of 23,434,229 ordinary shares of CCCM for an aggregate payment of $ 239,345,691 . Note 5. Digital Assets The following table sets forth the units held, cost basis and fair value of crypto assets held, as shown on the balance sheet as of December 31, 2025: The cost basis represents the average cost at the time the Company purchased the Bitcoin. Schedule of Significant Digital Assets Holdings Quantity Cost Basis Fair Value BTC 5,000.47 $ 466,796,700 $ 441,791,316 Total $ 466,796,700 $ 441,791,316 The following table presents a reconciliation of the fair values of the Company’s digital assets held for the period from June 17, 2025 (inception) through December 31, 2025, based on the fair value model under ASU 2023-08: Schedule of Reconciliation of digital assets Fair value Digital assets as of June 17, 2025 (inception) $ — Purchase of digital assets 983,296,700 Sale of digital assets ( 462,036,316 ) Net realized loss on sale of digital assets ( 54,463,684 ) Net unrealized loss on digital assets ( 25,005,384 ) Digital assets fair value as of December 31, 2025 $ 441,791,316 F- 17 Note 6. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: Schedule of Prepaid Expenses and Other Current Assets Prepaid expenses: December 31, 2025 Prepaid insurance $ 1,812,891 Prepaid expenses - current 50,325 Total prepaid expenses - current $ 1,863,216 Prepaid expenses - non-current $ 16,250 Other current assets: Interest receivable $ 257,389 Note 7. Fixed Assets Fixed assets consist of the following: Schedule of Fixed Assets December 31, 2025 Furniture and equipment $ 9,533 Leasehold improvements 75,049 84,582 Less: accumulated depreciation ( 32,469 ) Total fixed assets, net $ 52,113 Depreciation expense related to the Company’s fixed assets was $ 32,469 for the period from June 17, 2025 (inception) through December 31, 2025. F- 18 Note 8. Debt In connection with the execution of the Business Combination Agreement, on June 23, 2025, certain qualified investors (the “Convertible Note Investors”) each entered into a subscription agreement (collectively, the “Convertible Note Subscription Agreements”), with ProCap and CCCM. On December 5, 2025, upon the Closing of the Business Combination, the Convertible Note Investors purchased convertible notes issued by the Company (“Convertible Notes”) in an aggregate principal amount of $ 235,000,000 , for an aggregate purchase price equal to 97 % of the aggregate principal amount of the Convertible Notes. The Convertible Notes have a conversion rate of 76.9 shares per $ 1,000 equal to an approximately $ 13.00 conversion price, zero interest rate, maturity of up to 36 months , and are collateralized by cash, cash equivalents and certain Bitcoin assets. Under the indenture associated with the Convertible Notes, the Company has up to 30 days from the closing of the Business Combination to 1.0:1.0 times collateralize the Convertible Notes using a mix of Bitcoin (with Bitcoin being valued at 50% for collateral calculation purposes), cash and cash equivalents (with cash and cash equivalents being valued at 100% for collateral calculation purposes). This note has an effective interest rate of 9.09 %. U.S. Bank National Trust, N.A. (“US Bank”) serves as collateral agent and trustee with regard to the Convertible Notes and associated indenture and security arrangements. As of December 31, 2025, the Company had $ 145,239,552 on deposit at US Bank. Each Convertible Note Investor may, at its option, convert each $ 1,000 principal amount of their Convertible Note into a number of shares of common stock equal to the conversion rate in effect on the conversion date, cash, or a combination of common stock and cash at any time from the issue date until the close of business on the second scheduled trading date immediately before the maturity date. The embedded conversion of the Convertible Notes meets the criteria for bifurcation and is recognized as a separate derivative instrument. If an event of default occurs, then the principal amounts on all the Convertible Notes then outstanding will immediately become due and payable. The table below summarizes the outstanding Convertible Notes as of December 31, 2025, including the effects of discounts and debt issuance costs: Schedule of Convertible Note December 31, 2025 Convertible Notes due 2028 $ 235,000,000 Discount, net (1) ( 11,387,249 ) Debt issuance costs, net (2) ( 9,440,843 ) Convertible Notes, net $ 214,171,908 (1) Discount as of December 31, 2025 consisted of $ 7,050,000 of original issue discount and $ 4,629,230 for the fair value of the embedded derivative less accumulated amortization of $ 291,981 . (2) Debt issuance costs as of December 31, 2025 consisted of $ 9,682,916 in debt issuance costs less accumulated amortization of $ 242,073 . The table below reflects the principal amount of loan maturities due over the next five years as of December 31, 2025: Schedule of Loan Maturities 5-Year Loan Maturities Fiscal Year 2026 2027 2028 2029 2030 Total 2028 Convertible Notes $ - $ - $ 235,000,000 $ - $ - $ 235,000,000 F- 19 The table below presents the disaggregation of interest expense for the period from June 17, 2025 (inception) through December 31, 2025: Schedule of Disaggregation of Interest Expense For the period from June 17, 2025 (inception) through December 31, 2025 Debt discount amortization $ 291,981 Debt issuance cost amortization 242,073 Interest expense $ 534,054 Note 9. Income Taxes The Company files a consolidated federal income tax return and various state income tax returns. The amount of income taxes the Company records requires the interpretation of complex rules and regulations of federal and state taxing jurisdictions. A reconciliation of the U.S. federal statutory rate to the Company’s effect income tax rate is as follows: Schedule of Effective Income Tax Rate Reconciliation As of December 31, 2025 U.S. federal statutory rate 21.0 % Change in fair value of conversion feature 40.8 % Change in valuation allowance ( 61.8 )% Provision (benefit) for income taxes 0.0 % GAAP requires deferred income tax assets and liabilities to be measured at the enacted tax rate expected to apply when temporary differences are to be realized or settled. Significant components of net deferred tax assets (liabilities) at December 31, 2025 are as follows: Schedule of Deferred Income Tax Assets and Liabilities As of December 31, 2025 Deferred Tax Asset (Liability) Stock Based Compensation $ 92,829 Change in Fair Value of Digital Assets 5,251,131 Interest expense, net 57,564 NOL - Federal 13,021,839 Change in Fair Value of Convertible Note Conversion Feature ( 493,561 ) Change in Fair Value of Derivative Securities ( 22,315 ) Net operating losses 17,907,487 Valuation Allowance ( 17,907,487 ) Deferred Tax Asset (Liability) $ - F- 20 Valuation Allowance Roll Forward Deferred: As of December 31, 2025 US Federal expense (benefit) $ ( 17,907,487 ) State and local expense (benefit) - Change in valuation allowance 17,907,487 Total $ - A valuation allowance for deferred tax assets, including net operating losses, is recognized when it is more likely than not that some or all of the benefit from the deferred tax asset will not be realized. To assess that likelihood, we use estimates and judgment regarding our future taxable income, and we consider the tax consequences in the jurisdiction where such taxable income is generated, to determine whether a valuation allowance is required. Such evidence can include our current financial position, our results of operations, both actual and forecasted, the reversal of deferred tax liabilities, and tax planning strategies as well as the current and forecasted business economics of our industry. As of December 31, 2025, the Company’s deferred tax assets consisted primarily of $ 13.0 million related to federal net operating loss carry forwards, $ 5.3 million related to changes in the fair value of digital assets, and $ 0.2 million related to stock-based compensation and interest expense, partially offset by deferred tax liabilities related to changes in the fair value of convertible note conversion features and derivative securities. The resulting gross deferred tax assets were fully offset by a valuation allowance, resulting in no net deferred tax asset or liability as of December 31, 2025. When more than a 50% change in ownership occurs, over a three-year period, as defined, the Tax Reform Act of 1986 limits the utilization of net operating loss carry forwards in the years following the change in ownership. In December 2025, the Company issued common stock to various parties in connection with the business combination. A Section 382 ownership study has not been completed yet. The management will continue to evaluate the occurrence of ownership change and the impact on utilization of prior year NOL, which otherwise can be carried forward indefinitely. We have evaluated whether there were material uncertain tax positions requiring recognition in our financial statements. As of December 31, 2025, the Company has not identified unrecognized tax benefits that would favorably affect the effective tax rate if resolved in the Company’s favor and the Company recognized $ 0 uncertain tax liability. Note 10. Revenue from Contracts with Customers The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. Revenue is recognized when control of promised services is transferred to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services. The Company provides digital advertising and marketing services, including weekly audio, video, and social media placements. These services represent a single performance obligation satisfied over time, as customers simultaneously receive and consume the benefits of the services as they are delivered. The Company uses a time-elapsed (straight-line) measure of progress for arrangements in which services are provided evenly throughout the contract term. Customer payments are typically due upfront or within 30 days of service commencement. Consideration is generally fixed, and the Company does not have material variable consideration, noncash consideration, or significant financing components. Significant Judgments Significant judgments affecting the amount and timing of revenue recognition include: ● Identification of performance obligations: Digital advertising services are determined to be a single performance obligation under the series guidance in ASC 606-10-25-14(b). ● Measure of progress: Straight-line recognition is applied because services are delivered evenly over the contract period. ● Assessment of collectability: The Company evaluates customer creditworthiness at contract inception and throughout the arrangement. Costs to Obtain or Fulfill a Contract The Company does not incur incremental costs to obtain contracts (such as sales commissions). Costs to fulfill a contract are not capitalized because such costs are either immaterial or do not meet the criteria under ASC 340-40. F- 21 Remaining Performance Obligations As of December 31, 2025 , the Company’s remaining performance obligations under non-cancelable contracts were $ 1,000 , all of which are expected to be recognized as revenue within the next 6 months. The Company applies the practical expedient in ASC 606-10-50-14(a) for contracts with an original duration of one year or less. Note 11. Fair Value Measurements The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis and the Company’s estimated level within the fair value hierarchy of those assets and liabilities as of December 31, 2025: Schedule of Assets and Liabilities Measured at Fair Value Fair value measured at December 31, 2025 Total fair value at December 31, 2025 Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Digital assets $ 441,791,316 $ 441,791,316 $ - $ - Liabilities: Derivative securities liabilities $ 428,236 $ - $ - $ 428,236 Conversion feature liability - convertible notes $ 2,278,940 $ - $ - $ 2,278,940 Digital Assets In determining the fair value of its Bitcoin investments, the Company uses quoted prices as determined by utilizing Coinbase closing prices at midnight UTC. As such, the Company’s digital assets were determined to be Level 1 assets. Conversion Feature Liability - Convertible Notes In determining the fair value of Conversion Feature Liability, the Company utilized the Black-Scholes pricing model which is considered to be Level 3 liability. The key inputs are presented in the table below: Schedule of Key Input Measurement For Fair Value As of December 5, 2025 (Initial) As of December 31, 2025 Strike price $ 13.00 $ 13.00 Stock price $ 4.36 $ 3.53 Volatility 45.0 % 45.0 % Remaining term (in years) 3.00 3.00 Risk-free rate 3.53 % 3.49 % F- 22 The following table presents a roll-forward of the Convertible Note Conversion Feature Liability for the period from June 17, 2025 (inception) through December 31, 2025 Schedule of Roll Forward Convertible Notes Conversion feature liability - convertible notes As of June 17, 2025 (inception) $ - Initial value at December 5, 2025 4,629,230 Change in fair value ( 2,350,290 ) Balance at December 31, 2025 $ 2,278,940 Derivative Liability - Preferred Units In determining the fair value of the Derivative Liability - Preferred Units, the Company utilized the Black-Scholes pricing model which is considered to be a Level 3 liability. The key inputs are presented in the table below: Schedule of Key Input Measurement For Fair Value As of June 23, 2025 (Initial) Strike price - Preferred unit $ 11.94 Stock price $ 10.79 Volatility 47.6 % Remaining term (in years) 0.5 Risk-free rate 4.29 % The following table presents a roll-forward of the Derivative Liability – Preferred Units for the period from June 17, 2025 (inception) through December 31, 2025: Schedule of Roll Forward Derivatve Liability Preferred Units Derivative Liability As of June 17, 2025 (inception) $ - Initial value as of June 23, 2025 56,298,500 Settlement of Derivative ( 56,298,500 ) Balance at December 31, 2025 $ - Derivative Securities Liabilities When quoted market prices are not available, fair value is determined using a market-participant-based option pricing model. The Company utilizes a Black-76 valuation model to determine the fair value of BTC put options leveraging calibrated Bitcoin forward curves and volatility surfaces daily at 4:00 PM ET using executable bid-offer prices and futures data sourced from Deribit. These calibrated inputs are applied across option strikes and maturities to derive fair-market pricing. F- 23 The following table presents a roll-forward of the derivative securities liability for the period from June 17, 2025 (inception) through December 31, 2025: Schedule of Roll Forward Derivative Liability, Put Option Fair value As of June 17, 2025 (inception) $ - Premiums received on sold BTC put options 534,500 Net change in fair value recognized in earnings ( 106,264 ) Settlements / expirations - Fair value as of December 31, 2025 $ 428,236 See Note 3 above for a description of the Company’s accounting policies. Note 12. Stockholders’ Equity Preferred stock — The Company is authorized to issue 50,000,000 shares of preferred stock with a par value of $ 0.001 per share. As of December 31, 2025, there were no shares of preferred stock issued and outstanding. Common stock — The Company is authorized to issue 550,000,000 shares of common stock with a par value of $ 0.001 per share. As of December 31, 2025, there were 85,166,604 shares of common stock issued and 84,327,208 shares of common stock outstanding (see Note 4). Each share of common stock entitles the holder to one vote. Treasury stock — On December 11, 2025, the Board of Directors of ProCap Financial, Inc. (the “Company”) approved a share repurchase program (the “2025 Repurchase Program”) providing for the repurchase of up to $ 100 million of the Company’s outstanding shares of common stock, par value $ 0.001 per share (the “Common Stock”). Under the 2025 Repurchase Program, the Company is authorized to repurchase shares of Common Stock through open market purchases, privately-negotiated transactions, accelerated share repurchases, or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The 2025 Repurchase Program does not obligate the Company to repurchase shares of Common Stock and the specific timing and amount of repurchases will vary based on available capital resources and other financial and operational performance metrics, market conditions, securities law limitations and other factors. In connection with the 2025 Repurchase Program, on December 12, 2025, the Company entered into an Open Market Share Repurchase Agreement (the “Repurchase Agreement”) with TD Securities Inc. (the “Broker”) whereby the Broker has agreed to act as a non-exclusive agent on behalf of the Company to repurchase shares of Common Stock in the open market pursuant to Rule 10b5-1 and Rule 10b-18 of the Exchange Act. The Repurchase Agreement will continue in effect until terminated by either the Company or the Broker, with or without cause, upon written notice to the other party. The Company will pay the Broker a commission at a rate of $ 0.02 for each share of Common Stock repurchased pursuant to the Repurchase Agreement. As of December 31, 2025, the Company held 839,396 shares of treasury stock, which were acquired for an aggregate purchase price of $ 2,846,627 , as reflected in the accompanying consolidated statements of cash flows. Warrants — As part of CCCM’s initial public offering, CCCM issued warrants to third party investors where each whole warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $ 11.50 per share (the “Public Warrants”). Simultaneously with the closing of the initial public offering CCCM completed the private sale of warrants where each warrant allows the holder to purchase one share of the Company’s common stock at $ 11.50 per share (the “Private Placement Warrants”). The warrants cannot be exercised until 30 days after the completion of the business combination, and will expire at 5:00pm, New York City time, December 5, 2030. As of December 31. 2025, there were 12,500,000 Public Warrants and 352,500 Private Placement Warrants. F- 24 Redemption of Warrants When the Price per Share Equals or Exceeds $ 18.00 The Company may redeem the outstanding warrants: ● in whole and not in part; ● at a price of $ 0.01 per warrant; ● upon a minimum of 30 days’ prior written notice of redemption (the “30-day redemption period”); and ● if, and only if, the last reported sale price (the “closing price”) of the common stock equals or exceeds $ 18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant) for any 20 trading days within a 30 -trading day period commencing at least 30 days after completion of the business combination and ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders. Note 13. Share-Based Compensation On October 29, 2025, the Company’s Board of Directors adopted, and the Company’s stockholders approved the ProCap Financial, Inc. 2025 Equity Incentive Plan whereby it may grant to employees, consultants or non-employee directors an award, such as (1) options and stock appreciation rights, (2) performance stock, (3) performance stock units, (4) restricted stock, and (5) restricted stock units of the Company. The aggregate number of shares which may be issued or transferred under the plan is equal to the sum of (i) 10% of the shares outstanding post-closing of the Business Combination and (ii) an annual increase on the first day of each year beginning in 2026 and ending in (and including) 2035 equal to the lesser of (A) 5% of the shares outstanding on the last day of the immediately preceding fiscal year and (B) such smaller number of shares as determined by the Board or the compensation committee of the Board. Restricted Stock Units For the period from June 17, 2025 (inception) through December 31, 2025, the Company issued restricted stock units (“RSU’S) under the 2025 Equity Plan. Each RSU entitles the recipient to one share of the Company’s common stock upon vesting. The Company measures the grant date fair value of RSU’s based on the nature of the vesting conditions. For RSU’s subject only to service-based vesting conditions, fair value is measured using the stock price on the grant date. For RSU’s subject to performance-based vesting conditions, including market-based share price targets, grant date fair value is determined using a Monte Carlo valuation model which incorporates assumptions regarding volatility of 60%, risk-free interest rate of 3.9%, expected term of 7 years, and stock price of $4.36 to calculate the probability of achieving the specified performance conditions, consistent with ASC 718. Performance-based RSU’s will be forfeited to the extent any outstanding portion of the award remains unvested as of the seventh anniversary of the date of the grant of the award or upon the employee’s termination of employment for any such reason. The RSU’s subject to market-based share price targets will be eligible to vest upon the achievement of the following share price vesting conditions as long as the employee remains employed by the Company through the date in which the share price vesting condition is satisfied for any five continuous business days where a share of common stock of the Company closes at or above the applicable share prices below: Schedule of Restricted Stock Unit Number of RSU’s eligible to vest Share price 250,000 $ 15.00 250,000 $ 17.50 250,000 $ 20.00 250,000 $ 22.50 250,000 $ 25.00 500,000 $ 27.50 500,000 $ 30.00 500,000 $ 32.50 500,000 $ 35.00 500,000 $ 37.50 750,000 $ 40.00 750,000 $ 42.50 750,000 $ 45.00 1,000,000 $ 47.50 1,000,000 $ 50.00 F- 25 The table below presents the summary of activity with respect to, and status of restricted stock units for the period from June 17, 2025 (inception) through December 31, 2025: Schedule of Activity Restricted Stock Units Number of Restricted Stock Units Weighted Average Grant Date Value Unvested as of June 17, 2025 - - Granted 8,220,000 $ 2.13 Forfeited - - Vested ( 201,586 ) $ 2.11 Unvested as of December 31, 2025 8,018,414 $ 2.13 As of December 31, 2025, there were 8,220,000 restricted stock units outstanding. As of December 31, 2005, unrecognized compensation cost related to the grant of restricted stock units was $ 17,058,191 and had a remaining vesting period of approximately 2.1 years to 3.93 years. Stock-based compensation expense related to RSUs recognized during the period from June 17, 2025 (inception) through December 31, 2025 was $ 442,043 , and is included in the accompanying consolidated statements of operations. Note 14. Commitments and Contingencies As of December 31, 2025, we did not have any material commitments except as noted below. Non-Competition Agreement Contemporaneously with the execution and delivery of the Business Combination Agreement, ProCap BTC, CCCM, the Company and Mr. Anthony Pompliano entered into a Non-Competition and Non-Solicitation Agreement, pursuant to which, until the earlier of (i) the date that is eighteen (18) months following the Closing Date June 23, 2025 and (ii) the date that is six (6) months after such date as Mr. Pompliano ceases to be a Control Person of the Company or ProCap BTC, Mr. Pompliano will not, directly or indirectly, become a Control Person of a public company with a primary portion of its business comprised of pursuing a Bitcoin treasury strategy program. For purposes of the Non-Competition Agreement, “Control Person” shall mean (x) the chairman of a board of directors, chief executive officer or president, or (y) the owner of such equity interests or right to acquire equity interests of a Person which entitles the holder thereof to the ability to manage or control such Person. Services Agreement In connection with the execution and delivery of the Business Combination Agreement, Inflection Points, an entity under common control, and the Company entered into an Investment Consulting and Marketing Services Agreement (the “Services Agreement”). Pursuant to the Services Agreement, Inflection Points agreed to provide certain services to the Company. The services shall be provided pursuant to statements of work. The Services Agreement has a term of four ( 4 ) years following the Effective Date and will automatically renew for a subsequent one (1) year term, unless either party gives the other party at least sixty (60) days’ prior written notice of non-renewal or otherwise terminates the Services Agreement or any statement of work as set forth therein. In consideration of the Work performed, upon execution of this Agreement, Service Provider shall receive an aggregate of 10,000,000 Common Units of ProCap BTC, which were exchanged for 10,000,000 shares of the Company’s stock at the closing of the Business Combination (See Note 4). Payment for all or part of the Work shall not constitute acceptance. As of December 31, 2025, these shares have been issued and are outstanding (see Note 12). These shares were recorded at fair value at date of issuance, which was reported at $ 10,000 on the statement of changes in stockholders’ equity. F- 26 Preferred Equity Subscription Agreement In connection with the execution of the Business Combination Agreement, certain “qualified investors” (defined to include “qualified institutional buyers” (“QIBS”), as defined in Rule 144A of the Securities Act, and institutional “accredited investors,” as defined in Rule 501 of Regulation D) (the “Preferred Equity Investors”) each entered into a Preferred Equity Subscription Agreement (collectively, the “Preferred Equity Subscription Agreements”) with CCCM, ProCap BTC and the Company, pursuant to which the Preferred Equity Investors subscribed to purchase an aggregate of 51,650,000 non-voting preferred units of ProCap BTC (“Preferred Units”), at a purchase price of $ 10.00 per unit in a private placement, for an aggregate amount of $ 516.5 million of such Preferred Units (the “Preferred Equity Investment,”), which were converted and exchanged for 64,562,500 shares of common stock of the Company at the Closing of the Business Combination (See Note 4). Additionally, each Preferred Equity Subscriber executed a joinder agreement to that certain Limited Liability Company Operating Agreement of the Company, dated as of June 22, 2025, by and among the Company and the members identified therein (the “LLC Agreement”), pursuant to which each Preferred Equity Subscriber accepted the rights, duties and obligations set forth in the LLC Agreement and became a preferred member of the Company. As described above, all of the proceeds from the Preferred Equity Investment were used by the Company to the purchase Bitcoin, which Bitcoin was held in a custodial account until the Closing, upon which it was contributed to ProCap Financial. Sponsor Earnout Agreement On December 3, 2025, the Company and Sponsor entered into an agreement (the “ Sponsor Earnout Agreement ”), providing that 8,333,333 shares of Pubco Stock (such shares subject to earnout, the “ Earnout Founder Shares ”), representing all of the shares of Pubco Stock issuable to the Sponsor or its transferees in exchange for their Class B ordinary shares of CCCM (“ Class B Ordinary Shares ”) upon the Closing, shall be subject to transfer restrictions set forth in the Sponsor Earnout Agreement (the “ Sponsor Transfer Restrictions ”) and shall vest and be released from such restriction only if certain price targets are achieved during the 2-year period following the Closing (the “ Earnout Period ”). The Sponsor Earnout Agreement provided that the Earnout Founder Shares shall vest and shall no longer be subject to the Sponsor Transfer Restrictions as follows: ● 100% of the Earnout Founder Shares will vest and shall no longer be subject to the Sponsor Transfer Restrictions if the closing price of the Pubco Stock equals or exceeds $10.21 per share (as may be adjusted) for any 20 trading days within any consecutive 30-trading day period during the Earnout Period (the “ Share Price Trigger Event ”). ● 100% of the Earnout Founder Shares will vest and shall no longer be subject to the Sponsor Transfer Restrictions if the BTC VWAP (as defined below) equals or exceeds $140,000 during any five-day period during the Earnout Period (the “ BTC Price Trigger Event ”). In the event that neither a Share Price Trigger Event nor a BTC Price Trigger Event has occurred on or prior to the second anniversary of the Closing Date, then, subject to the terms and conditions of the Sponsor Earnout Agreement, on such second anniversary, 100% of the Earnout Founder Shares will vest and will no longer be subject to the Sponsor Transfer Restrictions. Notwithstanding the foregoing, in the event that during the Earnout Period, the Company is subject to a change of control and the implied consideration per share of Pubco Stock pursuant to which the Company or its stockholders have the right to receive in such change of control equals or exceeds $ 10.21 (or the equivalent fair market value thereof, as determined by the board of directors of the Company following the Closing in good faith, in the event of any non-cash consideration), then, all of the Earnout Founder Shares that have not previously vested will vest and shall no longer be subject to the Sponsor Transfer Restrictions. F- 27 “BTC VWAP” means the dollar volume-weighted average price for Bitcoin (BTC) during any one hundred twenty (120)-hour period ending at the time of determination, as reported by Bloomberg through its “VAP” function for “XBTUSD BGN Currency” (or such other comparable calculation methodology as the Disinterested Independent Directors (as defined in the Sponsor Earnout Agreement) may determine in good faith if such Bloomberg function is no longer available). If the BTC VWAP cannot be calculated for Bitcoin (BTC) on such date on any of the foregoing bases, the BTC VWAP of Bitcoin (BTC) on such date shall be the fair market value as determined by the Disinterested Independent Directors of the Company acting in good faith. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction during such period. Effective December 3, 2025, the Company and Seller entered into an agreement (the “ Seller Earnout Agreement ”), providing that 9,500,000 shares of Pubco Stock (such shares subject to earnout, the “ Earnout Seller Shares ”), representing all of the shares of Pubco Stock otherwise issuable to the Seller upon the Closing, shall be subject to the transfer restrictions set forth in the Seller Earnout Agreement (the “ Seller Transfer Restrictions ”) and shall vest and be released from such restriction only if certain price targets are achieved during the Earnout Period. The Seller Earnout Agreement provides that the Earnout Seller Shares shall vest and shall no longer be subject to the Seller Transfer Restrictions as follows: ● 100% of the Earnout Seller Shares will vest and shall no longer be subject to the Seller Transfer Restrictions upon a Share Price Trigger Event. ● 100% of the Earnout Seller Shares will vest and shall no longer be subject to the Seller Transfer Restrictions upon a BTC Price Trigger Event. In the event that neither a Share Price Trigger Event nor a BTC Price Trigger Event has occurred on or prior to the second anniversary of the Closing Date, then, subject to the terms and conditions of the Seller Earnout Agreement, on such second anniversary, 100% of the earnout shares will vest and shall no longer be subject to the Seller Transfer Restrictions. Notwithstanding the foregoing, in the event that during the Earnout Period, the Company is subject to a change of control and the implied consideration per share of Pubco Stock pursuant to which the Company or its stockholders have the right to receive in such change of control equals or exceeds $ 10.21 (or the equivalent fair market value thereof, as determined by the board of directors of the Company following the Closing in good faith, in the event of any non-cash consideration), then, all of the Earnout Seller Shares that have not previously vested shall vest and shall no longer be subject to the Seller Transfer Restrictions. Put Option Derivative Liability On December 23, 2025 and December 24, 2025, ProCap Financial, Inc. entered into Bitcoin put option contracts with FalconX that obligate ProCap to buy Bitcoin at a fixed strike price if exercised by the counterparty on the January 30, 2026 expiration date. The aggregate premium for the put option contracts was $ 534,500 , which constitute freestanding derivative instruments and are recorded as a derivative liability on the consolidated balance sheet. The Company does not hedge the put option derivative liability on the consolidate balance sheet and therefore the Company is exposed to market risks related to Bitcoin prices and liquidity risks regarding potential cash flow if the option is exercised. As of December 31, 2025, the fair value of the put option contracts was $ 428,236 , and ProCap recognized a $ 106,264 change in fair value of derivative securities in other income (expense) on the consolidated statement of operations. Pursuant to the terms of the put option agreements, ProCap was required to post cash collateral to support its obligations under the contracts. As of December 31, 2025, ProCap had $ 4,645,780 of cash collateral held in a tri-party custodial agreement with BitGo, which is presented as restricted cash on the consolidated balance sheet. The posted collateral is not netted against the fair value of the put option liability. F- 28 The following table details the terms of the option transactions: Schedule of Option Transactions December 23, 2025 option transaction December 24, 2025 option transaction Strike price $ 75,000 $ 75,000 Put currency 200 BTC 430 BTC Settlement Deliverable Deliverable Note 15. Related Party Transactions As part of the Preferred Equity Subscription Agreements, Inflection Points purchased 850,000 preferred units for $ 8,500,000 . R efer to Note 14 for additional information . As part of the Services Agreement Inflection Points received 10,000,000 shares of common stock. Refer to Note 14 for additional information. On June 30, 2025, the Company entered into a promissory note (the “Promissory Note”) with Inflection Points, an entity under common control, for a principal sum of up to $ 1,000,000 . On July 11, 2025, the Company entered into an amended and restated promissory note, to ensure the Company and Procap BTC are listed as recipients of the funds. On October 5, 2025, the Company entered into the second amended and restated the promissory note, to increase the allowable principal draws to be up to $ 2,000,000 . During the period from June 17, 2025 (inception) through December 31, 2025, the Company received $ 1,777,581 of proceeds from the related-party Promissory Note and made $ 1,889,562 of repayments, as reflected in the accompanying consolidated statements of cash flows. In addition, $ 111,981 of amounts due to a related party were converted into the Promissory Note, which is presented as a non-cash financing activity. The Promissory Note bears no stated interest and was payable on the earlier of May 31, 2026 or the date on which the Company consummated the business combination. On December 5, 2025, in connection with the closing of the Business Combination, the Company repaid the outstanding balance of the Promissory Note. As of December 31, 2025, the outstanding balance on the Promissory Note was $ 0 . On October 1, 2025, the Company entered into a commercial sublease agreement with Inflection Points. The sublease terms allow the Company to occupy the premises on a month-to month arrangement starting on October 1, 2025, and ending upon notice of 60 days from either party to the other party. The monthly rent payment under the agreement is $ 19,600 . For the period from June 17, 2025 (Inception) through December 31, 2025, the Company recorded $ 58,800 of rent expense in the consolidated statement of operations. Note 16. Segment Information ASC Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise that engage in business activities from which it may recognize revenues and incur expenses, and for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker, or group, in deciding how to allocate resources and assess performance. The Company’s chief operating officer decision maker (“CODM”) has been identified as the Chief Executive Officer, who uses cash flows as the primary measure to manage the business and does not segment the business for internal reporting or decision making. Accordingly, management has determined that there is only one reportable segment. F- 29 Additionally, the CODM reviews the fair market value of Bitcoin to measure and monitor value and determine the most effective strategy of investment. Schedule of Fair Value of Bitcoin As of December 31, 2025 Digital Assets $ 441,791,316 The CODM assesses performance for the single segment and decides how to allocate resources based on net loss that also is reported on the consolidated statements of operations as net loss. As the Company is in the start-up phase, the CODM currently reviews general and administrative expenses to manage and forecast cash to ensure enough capital is available to achieve its business plan over the short-term period (ie less than a year). The CODM also reviews general and administrative costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget. General and administrative costs, as reported on the consolidated statement of operations, are the significant segment expenses provided to the CODM on a regular basis. Schedule of Segment Expenses For the period from June 17, 2025 (inception) to December 31, 2025 General and administrative $ 7,630,335 Note 17. Leases The Company leases its office facility under a month-to month operating lease arrangement. The Company has elected the short-term lease practical expedient under ASC 842 for this lease and therefore does not recognize a right-of-use asset or lease liability on the consolidated balance sheet for this arrangement. Lease expense for this month-to month lease is recognized on a straight-line basis and were $ 19,600 per month for the period from October 2025 to December 2025. Because the lease is cancellable at any time with no significant penalty, the Company is not committed to future minimum lease payments beyond the monthly term. Note 18. Subsequent events The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date the consolidated financial statements were issued, and no events, other than discussed below, have occurred that would require adjustments to the disclosures in the consolidated financial statements. Non-recognized Subsequent Events: Convertible Note Repurchase On February 9, 2026, we entered into privately negotiated notes repurchase agreements (the “Repurchase Agreements”) with certain holders (the “Noteholders”) of certain of our outstanding 0.00 % Convertible Senior Secured Notes due 2028 (the “2026 Convertible Notes”) under the Indenture, pursuant to which we agreed to repurchase (the “Repurchase”) approximately $ 135,400,000 in aggregate principal amount of the 2026 Convertible Notes held by the Noteholders for an aggregate of approximately $ 119,152,000 in cash. The Repurchase settled on or about February 10, 2026. Upon settlement of the Repurchase, the aggregate principal amount of the 2026 Convertible Notes outstanding was reduced to approximately $ 99,600,000 . Pursuant to the terms of the Indenture, the Company must maintain a 1:1 loan-to-collateral ratio, where Bitcoin is treated as 0.50 to 1.00 and cash is treated as 1.00 to 1.00. As of February 12, 2026, the Company’s collateral composition is as follows: (i) 3,000 Bitcoin and (ii) $26,722,563 in cash, the total amount of which complies with the terms of the Indenture. This collateral composition is subject to change to account for market conditions, including the price of Bitcoin. Share Repurchases Subsequent to year end and through F ebruary 12, 2026 , the Company repurchased 904,433 shares of common stock in the open market for $ 3,190,663 , including commissions, at an average price of $ 3.53 per share. Total shares outstanding after the repurchase were 83,422,775 as of February 12, 2026. Derivative Securities Liabilities In January 2026, the Company entered into multiple Bitcoin put option contracts with a single counterparty. Under the terms of these contracts, the Company may be required to purchase an aggregate of up to 900 Bitcoin at predetermined strike prices ranging from $70,000 to $80,000 per Bitcoin, subject to counterparty exercise on specified expiration dates in February and March 2026. The aggregate premium received for the put option contracts was $ 888,750 . In addition, Bitcoin put option contracts entered into in December 2025 expired unexercised in January 2026, resulting in the Company retaining the aggregate premiums of $ 534,500 . Agreement and Plan of Merger On February 9, 2026 the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Silvia Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company (“Merger Sub”), CFO Silvia, Inc, a Delaware corporation (“CFO Silvia”), Inflection Points Inc, a Delaware corporation (“Inflection Points”), Shain Noor (“Noor” and, together with Inflection Points, the “Sellers”), and Shain Noor, solely in his capacity as the stockholder representative (the “Stockholder Representative”). Under the Merger Agreement, Merger Sub will merge with and into CFO Silvia, with CFO Silvia surviving as a direct wholly owned subsidiary of the Company (the “Merger” or the “Proposed Transaction”). At the effective time of the Merger (the “Effective Time”), each share of CFO Silvia common stock outstanding immediately prior to the Effective Time (other than dissenting shares and treasury shares) will be converted into the right to receive shares of common stock of the Company, par value $ 0.001 per share (the “Company Common Stock”), consisting of (i) the per share merger consideration, and (ii) any per share earnout consideration, in each case as described in the Merger Agreement and related spreadsheet to be delivered prior to closing. In addition, each outstanding simple agreement for future equity (“SAFE”) will be terminated at the Effective Time, and each SAFE holder will be entitled to receive a portion of the total merger consideration and earnout shares (if any), in accordance with the Merger Agreement. A portion of the merger consideration otherwise payable to equity holders will be deposited into an escrow account for a period of twelve months to secure indemnification obligations. The shares of Company Common Stock issued in the Merger will be subject to transfer restrictions, including lock-up provisions, as further described in the Merger Agreement. Subject to the terms and conditions of the Merger Agreement, during the earnout period, if the volume-weighted trading price of the Company Common Stock equals or exceeds $ 9.00 on the applicable measurement date, the Company will issue the earnout shares within ten business days following such date; provided that any earnout shares deliverable to Noor are conditioned upon his continued employment and good standing through the earnout release date, subject to certain exceptions. The earnout may only be achieved and paid once, and Company’s earnout obligations terminate upon issuance of the earnout shares or expiration of the earnout period. In general, the Merger is intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, and the Merger Agreement is intended to constitute a plan of reorganization thereunder. The closing of the Merger is subject to customary closing conditions, including the filing of a certificate of merger with the Delaware Secretary of State, specified regulatory approvals (including any required filings under the Hart-Scott-Rodino Antitrust Improvements Act, if applicable), and the receipt of requisite approvals from CFO Silvia stockholders and Company stockholders, among other conditions set forth in the Merger Agreement. F- 30