HAMMER TECHNOLOGY HOLDINGS CORP. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA July 31, 2025 and 2024 Reports of Independent Registered Public Accounting Firms (Salberg PCAOB I.D. No. 106) F-1 Consolidated Balance Sheets F-2 Consolidated Statements of Operations F-3 Consolidated Statements of Changes in Stockholders' Equity (Deficit) F-4 Consolidated Statements of Cash Flows F-5 Notes to Consolidated Financial Statements F-6 16 Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of: Hammer Technology Holdings Corp. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Hammer Technology Holdings Corp. and Subsidiaries (the "Company") as of July 31, 2025, the related consolidated statements of operations, changes in stockholders' equity (deficit) and cash flows for the year then ended, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of July 31, 2025, and the consolidated results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company incurred a net loss from continuing operations of $4,429,910, cash used in continuing operating activities of $855,780, and no revenues generated from continuing operations. As of July 31, 2025 the Company had a working capital deficiency of $858,359. Additionally, the Company has consistently sustained losses since its inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. Management's Plan in regard to these matters is also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated 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 consolidated 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 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 consolidated 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 consolidated 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 consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion. 2295 NW Corporate Blvd., Suite 240 • Boca Raton, FL 33431-7326 Phone: (561) 995-8270 • Toll Free: (866) CPA-8500 • Fax: (561) 995-1920 www.salbergco.com • info@salbergco.com Member National Association of Certified Valuation Analysts • Registered with the PCAOB Member CPAConnect with Affiliated Offices Worldwide • Member AICPA Center for Audit Quality F-1 Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Impairment of Intangible assets As described in Footnote 2 "Summary of Significant Accounting Policies" and Footnote 5 "Intangible Assets, Net" to the consolidated financial statements, the Company fully impaired the customer contract asset as of July 31, 2025 resulting in a loss from the impairment of intangible assets of $1,888,842. We identified the Company's impairment analysis as a critical audit matter. Auditing management's analysis of this critical audit matter involved a high degree of subjectivity. The primary procedures we performed to address this critical audit matter included (a) Gained an understanding of management's process to conduct an impairment analysis, (b) evaluated if the valuation method used by management was appropriate (c) evaluated the data and assumptions used in management's impairment analysis, and (d) compared the accounting treatment and presentation to that described by the authoritative and interpretive literature. We agreed with management's final conclusions regarding impairment of intangible assets. /s/ Salberg & Company, P.A. SALBERG & COMPANY, P.A. We have served as the Company's auditor since 2025 . Boca Raton, Florida October 29, 2025 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of Hammer Fiber Optics Holdings Corp. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Hammer Fiber Optics Holdings Corp. ("the Company") as of July 31, 2024, and the related consolidated statements of operations, stockholders' equity (deficit), and cash flows for the year 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 July 31, 2024 and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has consistently sustained losses since its inception. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. 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 provide a reasonable basis for our opinion. Critical Audit Matters Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there were no critical audit matters. Fruci & Associates II, PLLC - PCAOB ID #0 5525 We have served as the Company's auditor since 2022. Spokane, Washington February 4, 2025 HAMMER TECHNOLOGY HOLDINGS CORP. CONSOLIDATED BALANCE SHEETS July 31, July 31, 2025 2024 ASSETS Current Assets Cash and cash equivalents $ 18,054 $ - Prepaid expenses 1,250 360 Current assets from discontinued operations - 205,906 Total current assets 19,304 206,266 Property and equipment, net 520 2,675 Intangible assets, net 215,710 2,779,520 Noncurrent assets from discontinued operations - 48,368 Total assets $ 235,534 $ 3,036,829 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities Accounts payable and accrued expenses $ 184,077 $ 194,858 Loans payable 24,253 24,253 Convertible notes payable - 682,000 Convertible notes payable - related parties 61,800 1,305,793 Warrant liabilities 63,000 18,000 Current liabilities from discontinued operations 544,533 1,773,242 Total current liabilities 877,663 3,998,146 Convertible notes payable, noncurrent - related parties 85,946 - Total liabilities 963,609 3,998,146 Commitments and contingencies (Note 11) - - Stockholders' Equity (Deficit) Common stock, $ 0.001 par value, 250,000,000 shares authorized 73,310,489 and 63,155,947 shares issued at July 31, 2025 and 2024, respectively and 69,057,154 and 61,402,612 shares outstanding at July 31, 2025 and July 31, 2024, respectively 73,311 63,156 Treasury stock ( 4,253,335 and 1,753,335 shares held at July 31, 2025 and 2024, respectively) ( 625,000 ) - Additional paid-in capital 31,653,420 28,007,940 Accumulated deficit ( 31,829,806 ) ( 29,032,413 ) Total Stockholder's Equity (Deficit) ( 728,075 ) ( 961,317 ) Total Liabilities and Stockholders' Equity (Deficit) $ 235,534 $ 3,036,829 The accompanying notes are an integral part of these consolidated financial statements. F-2 HAMMER TECHNOLOGY HOLDINGS CORP. CONSOLIDATED STATEMENTS OF OPERATIONS For the Years Ended July 31, 2025 2024 Revenues $ - $ 420 Operating expenses Selling, general and administrative expenses 842,609 728,714 Depreciation and amortization expense 677,723 673,193 Intangible asset impairment 1,888,242 - Total operating expenses 3,408,574 1,401,907 Loss from operations ( 3,408,574 ) ( 1,401,487 ) Other income (expense) Interest expense ( 1,500 ) ( 86,043 ) Warrant financing expense - ( 164,525 ) (Loss) gain on change in fair value of warrant liability ( 45,000 ) 177,750 Loss on conversion of debt ( 974,836 ) - Total other income (expense) ( 1,021,336 ) ( 72,818 ) Net loss from continuing operations before income taxes ( 4,429,910 ) ( 1,474,305 ) Provision for income taxes - - Net loss from continuing operations ( 4,429,910 ) ( 1,474,305 ) Net (loss) income from discontinued operations, after taxes Net (loss) income from discontinued operations ( 23,264 ) 241,292 Gain on disposal of subsidiaries 1,655,781 - Total net income from discontinued operations, after taxes 1,632,517 241,292 Net loss $ ( 2,797,393 ) $ ( 1,233,013 ) Weighted average number of common shares outstanding - basic and diluted Net loss from continuing operations per share, basic and diluted $ ( 0.07 ) $ ( 0.02 ) Net income from discontinued operations per share, basic $ 0.03 $ 0.00 Net income from discontinued operations per share, diluted $ 0.03 $ 0.00 Total net loss per share, basic and diluted $ ( 0.05 ) $ ( 0.02 ) Weighted average number of common shares outstanding - basic 61,375,762 62,755,125 Weighted average number of common shares outstanding - diluted 62,262,557 66,073,225 The accompanying notes are an integral part of these consolidated financial statements. F-3 HAMMER TECHNOLOGY HOLDINGS CORP. CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) Additional Total Common Stock Treasury Stock Paid-in Accumulated Stockholders' Shares Amount Shares Amount Capital Deficit (Deficit) Equity Balance, July 31, 2023 62,205,947 $ 62,206 1,753,335 $ - $ 27,808,440 $ ( 27,799,400 ) $ 71,246 Commitment shares issued 950,000 950 - - 199,500 - 200,450 Net loss for the year - - - - - ( 1,233,013 ) ( 1,233,013 ) Balance, July 31, 2024 63,155,947 $ 63,156 1,753,335 $ - $ 28,007,940 $ ( 29,032,413 ) $ ( 961,317 ) Treasury stock from Viper Sale - - 2,500,000 ( 625,000 ) - - ( 625,000 ) Common stock issued due to conversion of debt 10,154,542 10,155 - - 3,645,480 - 3,655,635 Net loss for the year - - - - - ( 2,797,393 ) ( 2,797,393 ) Balance, July 31, 2025 73,310,489 $ 73,311 4,253,335 $ ( 625,000 ) $ 31,653,420 $ ( 31,829,806 ) $ ( 728,075 ) The accompanying notes are an integral part of these consolidated financial statements. F-4 HAMMER TECHNOLOGY HOLDINGS CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended July 31, 2025 2024 Cash flows from operating activities: Net loss from continuing operations $ ( 4,429,910 ) $ ( 1,474,305 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 2,155 - Amortization 675,568 673,193 Loss on conversion of convertible note payable to common stock 974,836 - Change in fair value of warrant liability 45,000 ( 177,750 ) Intangible asset impairment 1,888,242 - Changes in operating assets and liabilities: Prepaid expenses ( 890 ) 7,620 Accounts payable and accrued expenses ( 10,781 ) 99,511 Net cash used in operating activities: $ ( 855,780 ) $ ( 871,731 ) Cash flows from investing activities: Software costs capitalized as intangible asset - ( 33,920 ) Net cash used in investing activities: $ - $ ( 33,920 ) Cash flows from financing activities: Proceeds from related party convertible notes 1,522,752 771,493 Repayment of notes payable ( 682,000 ) - Net cash provided by financing activities: $ 840,752 $ 771,493 Cash flows from discontinued operations: Cash provided by operations - discontinued operations ( 18,954 ) 145,412 Cash used in investing activities - discontinued operations ( 36,177 ) ( 19,719 ) Cash provided by financing activities - discontinued operations 14,080 15,910 Net cash used in discontinued operations: $ ( 41,051 ) $ 141,603 Net increase (decrease) in cash and cash equivalents ( 56,079 ) 7,445 Cash and cash equivalents from continuing operations - beginning of year - 18,912 Cash and cash equivalents from discontinued operations - beginning of year 74,133 47,776 Cash and cash equivalents at beginning of year $ 74,133 $ 66,688 Cash and cash equivalents from continuing operations - end of year 18,054 - Cash and cash equivalents from discontinued operations - end of year - 74,133 Cash and cash equivalents at end of year $ 18,054 $ 74,133 Supplemental Disclosure of Cash Flow Information Cash paid during the period: Interest $ 109,546 $ 21,756 Income Tax $ - $ 800 Supplemental Disclosure of Non-Cash Investing and Financing Activities Commitment shares issued $ - $ 200,450 Conversion of convertible debt to common stock $ 2,680,799 $ - The accompanying notes are an integral part of these consolidated financial statements. F-5 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS Hammer Technology Holdings Corp. (OTCPK:HMMR) is a company focused on sustainable shareholder value investing in both financial services technology and wireless telecommunications infrastructure. Hammer Technology Holdings Corp (the "Company" or "Hammer") is incorporated in the state of Nevada. As of the filing of the accompanying financial statements, the Company had one wholly-owned active subsidiary, Hammerpay USA Ltd. Additionally, the Company had two wholly-owned inactive subsidiaries: Hammer Fiber Optics Investment Ltd., and Hammer Wireless (SL) Limited. Effective on September 3, 2025, the Company amended its Articles of Incorporation, as amended with the State of Nevada to effect a change of the Company's name from "Hammer Fiber Optics Holdings Corp." to "Hammer Technology Holdings Corp." Hammer's financial technologies business is focused on providing digital stored value technology via its HammerPay mobile payments platform to enable digital commerce between consumers and branded merchants across the developing world, ensuring Swift, Safe and Secure encrypted remittances and banking transactions. Hammerpay USA Ltd. owns the intellectual property critical to the operations of the Company's financial technology business unit as well as certain key supplier, marketing and operating agreements. Hammer Fiber Optics Investment Ltd ceased operations on October 31, 2018 when Verizon Communications, LLC terminated the spectrum lease agreement. During the year ended December 31, 2020, the Company's board of directors approved the discontinuation of the operations of the Company's subsidiary Open Data Centers LLC. The operations of Open Data Centers, LLC were discontinued and the Company shut down its operations in its Piscataway, NJ data center. Open Data Centers, LLC was dissolved on December 30, 2020. On July 31, 2023 the Company's board of directors approved the discontinuation of the operations of Hammer Wireless (SL) Limited, the Company's data communications service in Sierra Leone. The operations were discontinued in March 2020 and all assets have been written down. On August 7, 2024, the Company authorized and executed a Purchase Agreement with Viper Networks, Inc. ("Viper") with the intention to sell the Company's telecommunications assets to Viper. The assets include 1st Point Communications LCC, and all its subsidiaries, Endstream Communications LLC, American Networks Inc., and a 10 % ownership interest in Wikibuli Inc. in exchange for returning 2,500,000 (2.5 Million) shares of the Company's common stock held by Viper. The transaction closed on November 1, 2024. The returned shares had a value of $ 0.25 per share on November 1, 2024 resulting in a total consideration value of $ 625,000 . With the divestiture of the telecommunications assets, the Company has begun to concentrate its efforts on its fintech initiatives. HammerPay is a scalable, mobile-first financial services technology platform featuring an advanced digital wallet and neo-banking system, designed for global deployment in both developed and emerging markets. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Principles of Consolidation Hammer Fiber Optics Holdings Corp. is the parent company and sole shareholder of HammerPay [USA], Ltd. The financial statements for Hammer Fiber Optics Holdings Corp. and its wholly-owned subsidiary are reported on a consolidated basis. All significant intercompany accounts and transactions have been eliminated. Its subsidiaries Hammer Fiber Optics Investments, Ltd., Hammer Wireless - SL, Ltd and its former subsidiary Open Data Centers, LLC are discontinued and are considered discontinued operations. Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates in the accompanying financial statements include the valuation of intangible assets and the valuation of warrant liabilities. Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. For the year ended July 31, 2025 the Company incurred a net loss from continuing operations of $ 4,429,910 , cash used in operating activities of $ 855,780 , and $ 0 of revenue generated from continuing operations. As of July 31, 2025 the Company had a working capital deficiency of $ 858,359 . Additionally, the Company has consistently sustained losses since its inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern for the one year period following the issuance date of these financial statements. The Company's continuation as a going concern is dependent upon, among other things, its ability to increase revenues, adequately control operating expenses and raise financing from third parties. No assurance can be given that the Company will be successful in these efforts. Management's plans are not expected to alleviate the substantial doubt about the Company's ability to continue as a going concern. F-6 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company continues to actively address this condition by seeking to raise additional funding through debt and equity financing until such time that ongoing revenues can sustain the business. The Company is also pursuing strategies to increase the amount of revenue generated, reduce the costs incurred, and to reduce the Company's outstanding liabilities. During the year ended July 31, 2025, the Company converted $ 2,680,799 of principal. Segment Reporting The Company adopted ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures as of August 1, 2024. The Company operates in one operating segment, and therefore one reportable segment, focused on providing digital stored value technology via its HammerPay mobile payments platform to enable digital commerce between consumers and branded merchants across the developing world. The Company's Chief Executive Officer is the Chief Operating Decision Maker ("CODM"). The CODM manages the Company's business activities as a single operating and reportable segment at the consolidated level. Accordingly, the CODM uses consolidated net loss from continuing operations to allocate resources and assess performance. The measure of segment assets is reported on the consolidated balance sheet as total consolidated assets. Cash and cash equivalents Cash equivalents include cash in banks, money market funds and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash. The Company maintains its cash balances with various banks. The balances are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $ 250,000 . The Company monitors the cash balances held in its bank accounts, and as of July 31, 2025 and 2024, the Company did not have any cash balances which exceeded the insured amounts. Property and equipment Property and equipment is stated at cost. Depreciation is computed primarily using the straight-line method over the estimated useful lives of the assets. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is reflected in the consolidated statement of operations or the period in which the disposal occurred. The Company computes depreciation utilizing estimated useful lives, as stated below: Property and Equipment, net categories Estimated Useful Life Computer and telecom equipment 5 Years Management regularly reviews property and equipment for possible impairment. This review occurs annually or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. Based on management's assessment, there were no indicators of impairment of the Company's property and equipment as of July 31, 2025 and 2024, respectively. Impairment of long-lived assets The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to future undiscounted cash flows to be generated by the asset. If such assets are considered impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Company did not recognize any related impairment losses during the year ended July 31, 2024. F-7 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 Due to uncertainty regarding the Company's ability to accurately project future earnings and positive cash flows related to its customer contract intangible asset, the Company fully impaired the customer contract asset as of July 31, 2025. As a result, the Company recognized a loss from the impairment of intangible assets of $1,888,242 for the year ended July 31, 2025. Intangible Assets The Company's intangible assets with finite lives, including customer contracts and internal-use software, are amortized over their estimated useful lives. The Company assess all amortizable intangible assets and other long-lived assets for impairment whenever circumstances or changes suggest the asset's carrying amount may not be recoverable. If impairment indicators are present, the Company evaluates recoverability by comparing the carrying amount of the asset group to its anticipated net undiscounted cash flows. Should these cash flows be less than the carrying amount, the Company proceeds to determine the asset's fair value and record any necessary impairment. Each year, the Company also re-evaluates the useful life of these intangible assets to decide if adjustments to their remaining useful lives are warranted based on current events and conditions (Note 5 - Intangible Assets, Net). Internal-Use Software The Company capitalizes costs incurred in the development or acquisition of software for internal use in accordance with ASC 350-40, Intangibles-Goodwill and Other-Internal-Use Software . Internal-use software is defined as software acquired, developed, or modified solely to meet the Company's internal needs, with no substantive plan to market the software externally. Costs are capitalized during the application development stage, which begins once the preliminary project stage is complete and management commits to funding the project. Capitalized costs may include external direct costs of materials and services, payroll and payroll-related costs for employees directly associated with the project, and interest costs incurred during development. Costs incurred during the preliminary project stage (e.g., planning, feasibility studies, vendor selection) and the post-implementation/operation stage (e.g., training, maintenance, data conversion) are expensed as incurred. Capitalized software costs are amortized on a straight-line basis over their estimated useful lives. The Company reviews the carrying value of internal-use software for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Leases The Company accounts for its lease contracts in accordance with the guidance in ASC 842. The Company determines if an arrangement is a lease at inception. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. For leases that do not provide an implicit rate, the Company uses its incremental borrowing rate. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. All leases that have lease terms of one year or less are considered short-term leases, and therefore are not recorded through a ROU asset or liability. As of July 31, 2025, and 2024, the Company did not have any leases with terms greater than 12 months. The Company does currently hold a month-to-month tenancy agreements for office space costing less than $2,000 per month. Revenue recognition The Company accounts for revenues under ASC 606, "Revenue from Contracts with Customers" (Topic 606). This standard clarifies the principles for recognizing revenue and develops a common revenue standard for GAAP. The Company performs the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company applies the five-step model to arrangements that meet the definition of a contract under Topic 606, including when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company evaluates the goods or services promised within each contract related performance obligation and assesses whether each promised good or service is distinct. The Company recognizes as revenue, the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Amounts invoiced or collected in advance of product delivery or providing services are recorded as unearned revenue or customer deposits. The company accrues for sales returns, credit losses, and other allowances based on its historical experience. F-8 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 Income taxes The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, "Accounting for Income Taxes". The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized. As of July 31, 2025 and 2024, the Company did not have any amounts recorded pertaining to uncertain tax positions. Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant's specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity ("ASC 480") and ASC 815, Derivatives and Hedging ("ASC 815"). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations. The fair value of the warrants liability was estimated using a Black-Scholes model. Convertible Notes The Company evaluates its convertible notes to determine if those convertible notes or embedded components of those contracts qualify as derivative liabilities, to be separately accounted for in accordance with ASC 815 " Derivatives and Hedging " ("ASC 815"). Further, the Company evaluates its convertible notes in accordance with ASC 480 "Distinguishing Liabilities from Equity" ("ASC 480") for classification as a liability or as equity. This assessment, which requires the use of professional judgment, is conducted at the time of the instrument's issuance, and as of each subsequent balance sheet date while the instruments are outstanding. Treasury Stock The Company utilizes the cost method of accounting to value treasury stock when repurchasing stock. Repurchases are reflected as reductions of stockholders equity at cost. Treasury stock is not considered outstanding and is excluded from the calculation of basic and diluted weighted average shares outstanding (Note 10 - Stockholders' Equity). Basic and diluted loss per share Basic income (loss) per common share is calculated by dividing net income (loss) available to common shareholders by the number of weighted average common shares issued and outstanding. Diluted income (loss) per common share is calculated by dividing net income (loss) available to common shareholders by the weighted average number of common shares issued and outstanding for the period, plus amounts representing the dilutive effect from the conversion of the convertible notes, as applicable. The Company calculates dilutive potential common shares for convertible securities using the as-if-converted method, which assumes the convertible securities will be converted as of the beginning of the period or the issuance date if later. The Company also calculates dilutive potential common shares using the treasury stock method for options and warrants. Fair value measurements The Company adopted the provisions of ASC Topic 820, "Fair Value Measurements and Disclosures", which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements. The estimated fair value of certain financial instruments, including cash and cash equivalents are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. ASC 820 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. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value: F-9 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 Level 1 - quoted prices in active markets for identical assets or liabilities Level 2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 - inputs that are unobservable (for example cash flow modeling inputs based on assumptions) The Company has no assets or liabilities valued at fair value on a recurring basis. Level 3 - Unobservable inputs reflecting management's assumptions about the inputs used in pricing the asset or liability. Financial assets and liabilities (including warrants) approximate fair value. All financial assets and liabilities approximate their fair value. Warrants liabilities are valued at Level 3. Fair Value Measurements at July 31, 2025 using: July 31, 2025 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Warrant Liabilities $ 63,000 - - 63,000 Fair Value Measurements at July 31, 2024 using: July 31, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Warrant Liabilities $ 18,000 - - 18,000 The warrant liabilities are measured at fair value using quoted market prices and estimated volatility factors based on historical prices for the Company's common stock and are classified within Level 3 of the valuation hierarchy. The following table provides a summary of changes in fair value of the Company's Level 3 financial liabilities as of July 31, 2025 and 2024: For the Year Ended July 31, 2025 July 31, 2024 Beginning Balance $ 18,000 $ 195,750 Change in fair value of warrant liabilities 45,000 ( 177,750 ) Balance as of July 31, $ 63,000 $ 18,000 The below table shows the Black-Scholes option-pricing model inputs used by the Company to value the derivative liability at each measurement date: July 31, 2025 July 31, 2024 Stock Price $ 0.21 $ 0.04 Risk-free interest rates 3.96 % 4.10 % Expected life (in years) 1.55 2.53 Expected volatility 1,228 % 868 % Dividend yield 0 % 0 % F-10 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses . This guidance requires entities to disclose more detailed information about the types of expenses, including purchases of inventory, employee compensation, depreciation, amortization, and depletion in commonly presented expense captions such as cost of sales and selling, general and administrative expenses. Such guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, although early adoption is permitted. This guidance should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this ASU on our disclosures. Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures ("ASU 2023-07"). ASU 2023-07 requires a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually. Additionally, it requires a public entity to disclose the title and position of the Chief Operating Decision Maker ("CODM"). ASU 2023-07 does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted this guidance on a retrospective basis as of August 1, 2024 and the adoption of this guidance had no material impact on the consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, "Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40)". This ASU reduces the number of accounting models for convertible debt instruments and convertible preferred stock, as well as amend the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related EPS guidance. The Company adopted this ASU on a modified retrospective basis as of August 1, 2023 and the adoption of this guidance had no material impact on the consolidated financial statements. NOTE 3 - DISCONTINUED OPERATIONS The Company accounts for discontinued operations in accordance with ASC 205-20, Presentation of Financial Instruments - Discontinued Operations. Hammer Fiber Optics Investment Ltd ceased operations on October 31, 2018 when Verizon Communications, LLC terminated the spectrum lease agreement. Open Data Centers, LLC ceased operations at its sole location in Piscataway, NJ on May 1, 2020. Open Data Centers, LLC was dissolved on December 30, 2020. The divestiture of Hammer Fiber Optics Investments Ltd and Open Data Centers, LLC qualified for held-for-sale accounting and represent a strategic shift with a major effect on the Company's operations and financial results. Following the divestitures, the Company does not have any significant continuing involvement in the operations of Open Data Centers, LLC or Hammer Fiber Optics Investment Ltd. As a result, the divestitures met the criteria for reporting as a discontinued operation. On August 7, 2024, the Company authorized and executed a Purchase Agreement with Viper to sell the Company's telecommunications assets to Viper (the "Viper Sale"). The assets include 1st Point Communications LCC, and all its subsidiaries, Endstream Communications LLC, American Networks Inc., and a 10 % ownership interest in Wikibuli Inc. As consideration for the Viper Sale the Company received back 2,500,000 shares of the Company's common stock. The Viper Sale closed on November 1, 2024. The returned shares had a value of $ 0.25 per share on November 1 2024 resulting in a total consideration value of $ 625,000 . The Viper Sale qualified for held-for-sale accounting and represents a strategic shift with a major effect on the Company's operations and financial results. Following the Viper Sale, the Company will not have any significant continuing involvement in the operations of Open Data Centers, LLC, 1 st Point Communications, LLC, Endstream Communications LLC, American Networks Inc., or Wikibuli Inc. As a result, the telecommunication assets met the criteria for reporting as a discontinued operation. With the divestiture of the telecommunications assets, the Company has begun to concentrate its efforts on fintech initiatives such as its mobile payments platform, instead of on telecommunication services. The financial results of the telecommunication assets are presented as loss from discontinued operations, after tax in the consolidated statement of operations. The following table represents the assets and liabilities of discontinued operations as of July 31, 2025 and 2024: F-11 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 July 31, July 31, 2025 2024 Current assets Cash and cash equivalents $ - $ 74,133 Accounts receivable - 110,894 Note receivable - - Security deposits - 7,316 Prepaid expenses - 13,563 Total current assets - 205,906 Noncurrent assets Property and equipment, net - 48,368 Total noncurrent assets - 48,368 Total assets - discontinued operations $ - $ 254,274 Current liabilities Accounts payable and accrued expenses $ 544,533 $ 1,343,436 Loans payable - 84,350 Convertible notes payable - related parties - 204,300 Contract liabilities - 141,156 Total current liabilities 544,533 1,773,242 Total liabilities - discontinued operations $ 544,533 $ 1,773,242 The following table represents the major components of the financial results of discontinued operations for the years ended July 31, 2025 and 2024: For the Years Ended, July 31, 2025 2024 Revenues $ 1,233,567 $ 3,279,526 Cost of sales 970,210 2,398,667 Gross profit 263,357 880,859 Operating expenses Selling, general and administrative expenses 248,052 812,297 Depreciation and amortization expense 20,139 58,338 Total operating expenses 268,191 870,685 OPERATING INCOME (LOSS) ( 4,834 ) 10,174 Other income (expense) Other income - 293,753 Financing expense ( 18,430 ) ( 36,617 ) Other expenses - ( 26,018 ) Gain on disposal of subsidiaries 1,655,781 - Total other income (expense) 1,637,351 231,118 Net income from discontinued operations before taxes 1,632,517 241,292 Provision for income taxes - - Net income from discontinued operations, after taxes $ 1,632,517 $ 241,292 The following table presents the components of the gain on disposal of subsidiaries resulting from the disposal of the telecommunication assets sold to Viper on November 1, 2024: F-12 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 November 1, 2024 Net assets and liabilities Cash and cash equivalents $ ( 34,727 ) Accounts receivable ( 239,245 ) Note receivable ( 5,000 ) Security deposits ( 7,316 ) Prepaid expenses ( 18,143 ) Property and equipment, net ( 29,678 ) Accounts payable and accrued expenses 844,264 Loans payable 106,430 Convertible notes payable - related parties 201,300 Deferred revenue 212,896 Net gain from disposal of assets and liabilities 1,030,781 Consideration received in exchange for disposal of assets 625,000 Gain on disposal of subsidiaries $ 1,655,781 Loans payable from discontinued operations On August 7, 2024, the Company authorized and executed a Purchase Agreement with Viper to sell the Company's telecommunications assets to Viper (the "Viper Sale"). The assets include 1st Point Communications LCC, and all its subsidiaries, Endstream Communications LLC, American Networks Inc., and a 10% ownership interest in Wikibuli Inc. The Viper Sale closed on November 1, 2024. The telecommunication assets met the criteria for reporting as a discontinued operation and all assets and liabilities held within the telecommunication assets, including loans payable, were disposed of. On August 27, 2024, Endstream Communications entered into a financing agreement with a financial institution in the amount of $ 68,250 . As of November 1, 2024, the principal amount remaining under this financial agreement was $ 47,243 . As of November 1, 2024, the closing date of the Viper Sale, the liability from this financing agreement was assumed by Viper as part of the Viper Sale. On April 1, 2024, 1stPoint Communications entered into a financing agreement with a financial institution in the amount of $ 62,400 . As of November 1, 2024 and July 31, 2024, the principal amount remaining under this financial agreement was $ 15,600 and $ 35,880 , respectively. As of November 1, 2024, the closing date of the Viper Sale, the liability from this financing agreement was assumed by Viper as part of the Viper Sale. On August 8, 2024, a lender lent 1stPoint Communications $ 73,260 . As of November 1, 2024, the principal amount was $ 32,615 . As of November 1, 2024, this liability was assumed by Viper as part of the Viper Sale. On March 20, 2023, 1stPoint Communications entered into a financing agreement with a financial institution in the amount of $ 58,000 and $ 2,320 in transaction fees. As of November 1, 2024 and July 31, 2024 the principal remaining under this financial agreement was $ 0 and $ 17,234 , respectively. The balance was paid in full on October 6, 2023. As of November 1, 2024, the closing date of the Viper Sale, the liability from this financing agreement was assumed by Viper as part of the Viper Sale. During the fiscal year 2022, the Company entered into a non-interest bearing loan with a financial institution in the amount of $ 10,972 . As of November 1, 2024 and July 31, 2024 the principal remaining was $ 10,972 . As of November 1, 2024, the closing date of the Viper Sale, the liability from this loan was assumed by Viper as part of the Viper Sale. On February 26, 2021, Endstream Communications entered into a financing agreement with a financial institution in the amount of $ 40,000 . The amount was refinanced on March 25, 2022 and again on November 16, 2022 in the amount of $ 141,750 . The amount was refinanced once more during the year ended July 31, 2024 in the amount of $ 50,379 . As of November 1, 2024, and July 31, 2024 the principal remaining was $ 0 and $ 37,498 , respectively. The balance was paid in full on August 27, 2024. F-13 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 As of November 1, 2024 and July 31, 2024, notes payable from discontinued operations consisted of the following: November 1, 2024 July 31, 2024 Notes payable $ 106,430 $ 84,350 Less: current portion, net ( 106,430 ) ( 84,350 ) Long-term notes payable, net $ - $ - Related party convertible notes from discontinued operations On March 24, 2020, the Company entered into a convertible note with a former Chief Financial Officer of the Company in the amount of $ 43,000 . The convertible note bears interest at a rate of 6 % annually. The convertible note converts at a 20 % discount to market on the date of the proposed conversion, at the option of the Company or lender. The interest on this convertible note has been waived by the lender. As of November 1, 2024 and July 31, 2024, the balance of this note was $ 40,000 and $ 43,000 , respectively. As of November 1, 2024, the closing date of the Viper Sale, the liability from this convertible note was assumed by Viper as part of the Viper Sale. On September 1, 2020, the Company entered into a convertible note for the sum of $ 100,000 with a non-executive director. The convertible note bears interest at a rate of 6 % annually. The convertible note converts at a 20 % discount to market on the date of the proposed conversion, at the option of the Company or lender. Interest on the convertible note has been waived by the lender. The note has been amended several times, with a total increase in funding of $ 61,300 . As of November 1, 2024 and July 31, 2024, the balance of this note was $ 161,300 . As of November 1, 2024, the closing date of the Viper Sale, the liability from this convertible note was assumed by Viper as part of the Viper Sale. As of November 1, 2024 and July 31, 2024, related parties convertible debt from discontinued operations consisted of the following: November 1, 2024 July 31, 2024 Convertible notes payable - related parties from discontinued operations $ 201,300 $ 204,300 Less: current portion, net ( 201,300 ) ( 204,300 ) Long-term convertible notes payable - related parties, net $ - $ - NOTE 4 - PROPERTY AND EQUIPMENT As of July 31, 2025 and 2024, property and equipment consisted of the following: July 31, July 31, 2025 2024 Life Computer and telecom equipment $ 2,675 $ 2,675 5 years Less: Accumulated depreciation ( 2,155 ) - Total $ 520 $ 2,675 The company regularly reviews property and equipment for possible impairment. This review occurs annually or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. Based on management's assessment, there were no indicators of impairment of the Company's property and equipment as of July 31, 2025 and 2024, respectively. The Company recognized depreciation expense of $ 2,155 and $ 0 during the years ended July 31, 2025 and 2024, respectively. NOTE 5 - INTANGIBLE ASSETS, NET The following table displays the composition of intangible assets, net as well as the respective amortization period: July 31, 2025 July 31, 2024 Useful Life Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Customer contracts 7 $ - $ - $ - $ 3,862,657 $ 1,422,607 $ 2,440,050 Software 5 618,804 403,094 215,710 618,804 279,334 339,470 Total $ 618,804 $ 403,094 $ 215,710 $ 4,481,461 $ 1,701,941 $ 2,779,520 In January 2022, the Company completed an asset acquisition and purchased a $ 3,862,657 customer contract intangible asset and a $ 387,843 software asset. The Company capitalizes internal-use software development costs. During the years ended July 31, 2025 and 2024 the Company capitalized $ 0 and $ 33,920 of software development costs (Note 2 - Summary of Significant Accounting Policies). F-14 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 Due to uncertainty regarding the Company's ability to accurately project future earnings and positive cash flows related to its customer contracts intangible asset, the Company fully impaired the customer contracts asset as of July 31, 2025. As a result, the Company recognized a loss from the impairment of intangible assets of $ 1,888,242 for the year ended July 31, 2025. The Company incurred amortization expense of $ 675,568 and $ 673,193 for the years ended July 31, 2025 and 2024, respectively. Estimated annual amortization expense for intangible assets is as follows: For the years ended July 31, 2026 $ 123,761 2027 71,290 2028 18,011 2029 2,648 Thereafter - Total $ 215,710 NOTE 6 - LOANS PAYABLE On January 5, 2022, the Company entered into an unsecured promissory note with a lender in the amount of $ 29,253 . The promissory note bears interest at a rate of 6 % annually and has a maturity date of December 31, 2024. During the years ended July 31, 2025 and 2024 the Company incurred interest expense of $ 1,455 and $ 1,459 , respectively, due to the promissory note. At July 31, 2025 and 2024 the Company had an outstanding accrued interest balance from the promissory note of $ 5,199 and $ 3,744 , respectively. As of July 31, 2025 and 2024, the balance of this note was $ 24,253 . As of July 31, 2025 the promissory note was past due and in default. As of July 31, 2025 and 2024, notes payable consisted of the following: July 31, 2025 July 31, 2024 Notes payable $ 24,253 $ 24,253 Less: current portion, net ( 24,253 ) ( 24,253 ) Long-term notes payable, net $ - $ - NOTE 7 - RELATED PARTY CONVERTIBLE DEBT Related party convertible notes from continued operations On August 22, 2019, the Company entered into a convertible note with Andrea Levitt, a related party, in the amount of $ 12,000 . Principal of $ 4,500 has been repaid. The note will convert into Common Stock at the Company's option and bears interest at a rate of 6 % annually, to be expensed at the time of conversion. The interest and maturity date on this convertible note have been waived by the lender. As a result, the Company did not recognize any interest expense from this note during the years ended July 31, 2025 and 2024.. As of July 31, 2025 and 2024, the balance of this convertible note was $ 7,500 . On August 24, 2019, the Company entered into two convertible notes with Andera Capital, LLC and Somerset Health Care Advisors, both of which are related parties (who were former partners in 1stPoint Communications, LLC) in the amounts of $ 12,000 and $ 6,000 respectively. Both notes bear interest at a rate of 6 % annually and any interest may be accrued as either cash or stock at the option of the Company. The interest and maturity dates on these convertible notes have been waived by the lender. As a result, the Company did not recognize any interest expense from this note during the years ended July 31, 2025 and 2024. The convertible notes convert at a 20 % discount to market on the date of the proposed conversion, at the option of the Company or lender. As of July 31, 2025 and 2024 the balances of each of these notes were $ 12,000 and $ 6,000 . On April 20, 2020, the Company entered into a convertible note with Erik Levitt, a former Chief Financial Officer of the Company, in the amount of $ 36,300 with an original maturity date of April 20, 2024. The convertible note bears interest at a rate of 6 % annually. The convertible note converts at a 20 % discount to market on the date of the proposed conversion, at the option of the Company or lender. The interest and maturity date on this note have been waived by the lender. As a result, the Company did not recognize any interest expense from this note during the years ended July 31, 2025 and 2024. As of July 31, 2025 and 2024, the balance of this convertible note was $ 36,300 . F-15 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 On February 26, 2021, the Company entered into a convertible note (the "February 2021 Convertible Note") with Michael Sevell, a Director of the Company, in the amount of $ 25,000 . The note bears interest at a rate of 6 %, compounded monthly and payable upon repayment or conversion. The interest and maturity date of the February 2021 Convertible Note have been waived by the lender. As a result, the Company did not recognize any interest expense from the February 2021 Convertible Note during the years ended July 31, 2025 and 2024. The convertible note converts at a 20 % discount to market on the date of the proposed conversion, at the option of the Company or lender. The note has been amended several times, with an additional $ 1,436,806 loaned during the year ended July 31, 2025. On May 24, 2025 the Company, Michael Sevell, and Caban global Reach Private Equity LP ("CGRPE") entered into an Assignment and Assumption Agreement, pursuant to which, Michael Sevell assigned to CGRPE the full balance of February 2021 Convertible Note. Michael Sevell and Michael Cothill, two Directors of the Company, are both Directors of CGRPE. On May 26, 2025 the Company and CGRPE entered into a debt exchange agreement (the "exchange"), pursuant to which the entire principal balance of the February 2021 Convertible Note was forgiven in exchange for 10,154,542 shares of common stock (Note 10 - Stockholders' Equity). As a result, the Company recognized a loss on conversion of $ 974,836 . Immediately prior to the exchange the February 2021 Convertible Note had a principal balance of $ 2,680,799 . As of July 31, 2025 and 2024, the balance of this note was $ 0 and $ 1,243,993 , respectively. On May 2, 2025, the Company entered into a promissory note agreement ("May 2025 Convertible Note") with CGRPE, pursuant to which CGRPE agreed to fund the Company with advances in an open loan facility. All amounts lent to the Company must be repaid by May 2, 2028. Interest accrues on the May 2025 Convertible Note at a rate of 4 % per annum. The outstanding principal may be converted into shares of restricted common stock at the option of the related party. The conversion price is equal to the prevailing market price on the date of conversion at a 25 % discount. As of July 31, 2025 the outstanding balance due to the May 2025 Convertible note was $ 85,946 . The Company recognized interest expense of $ 326 due to the May 2025 Convertible note during the year ended July 31, 2025. As of July 31, 2025 and 2024, related parties convertible debt consisted of the following: July 31, 2025 July 31, 2024 Convertible notes payable - related parties $ 147,746 $ 1,305,793 Less: current portion, net ( 61,800 ) ( 1,305,793 ) Long-term convertible notes payable - related parties, net $ 85,946 $ - NOTE 8 - CONVERTIBLE DEBT On February 11, 2022, the Company entered into a Securities Purchase Agreement (the "Mast SPA") by and between the Company and Mast Hill Fund, L.P. ("Mast"). Pursuant to the terms of the Mast SPA, the Company issued Mast a promissory note in the aggregate principal amount of $ 550,000 (the "Mast Note"). The Mast Note is convertible into shares of the Company's common stock. The Mast Note has an original issue discount of $ 55,000 , resulting in gross proceeds to the Company of $ 495,000 . Mast has piggyback registration rights pursuant to the terms of the Mast SPA. Mast Hill converted approximately $ 72,148 in interest and $ 1,750 in fees totaling approximately $ 73,897 into that number of shares of common stock on March 23, 2023. The Company entered into the First Amendment to the Mast Note as of March 6, 2023, through which both parties agreed to increase the principal balance of the note by $ 62,000 . Pursuant to the terms of the Mast SPA, the Company also agreed to issue (i) a common stock purchase warrant to purchase 150,000 shares of Company common stock at an exercise price of $ 3.00 (the "Mast First Warrant"), (ii) a common stock purchase warrant to purchase 150,000 shares of Company common stock at an exercise price of $ 1.50 (the "Mast Second Warrant" and together with the Mast First Warrant, the "Mast Warrants"), and (iii) 475,000 shares (the "commitment shares") of Company common stock to Mast as additional consideration for the purchase of the Mast Note (Note 12 - Warrants). On April 4, 2024, the Company entered into the Second Amendment to the Mast Note, effectively increasing the principal balance of the note by $ 70,000 and extending the maturity date of the note to February 11, 2025. The terms of the amendment also included the issuance of 475,000 shares of the Company's common stock issued during the quarter ended April 30, 2024. The fair value of the common stock issued was determined using the stock price as of the date of the Second Amendment to the Mast Note at $ 0.199 per share or $ 94,525 in total. Such common stock shares issued were accounted for as a debt discount and recognized as financing expense for the year ended July 31, 2024. The Mast Note bears interest at a rate of 12 % per annum. Any amount of principal or interest on the Mast Note which is not paid when due will bear interest at a rate of the lesser of (i) 16 % per annum and (ii) the maximum amount permitted by law. The Mast Note may not be prepaid in whole or in part except as provided in the Mast Note by way of conversion at Mast's option. Mast has the right at any time to convert all or any part of the outstanding and unpaid principal amount and interest of the Mast Note into common stock, subject to a 4.99 % equity blocker, at a conversion price of $ 0.58 per share; provided, however, that Mast is entitled to deduct $ 1,750 from the conversion amount in each case to cover Mast's fees associated with conversion. Mast's right to exercise each of the Mast Warrants is subject to a 4.99 % equity blocker. Each of the Mast Warrants expires on the five-year anniversary of issuance. As of July 31, 2025 the Mast Note had been fully repaid and as result, it had a balance of $ 0 . As of July 31, 2024, the balance of the Mast Note was $ 682,000 . F-16 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 As of July 31, 2025 the Company did not have any outstanding convertible notes payable. As of July 31, 2025 and 2024, convertible debt consisted of the following: July 31, 2025 July 31, 2024 Convertible debt $ - $ 682,000 Original issue discount $ - $ - Less: current portion, net - ( 682,000 ) Long-term convertible debt, net $ - $ - NOTE 9 - INCOME TAXES The difference between the actual income tax rate versus the tax computed at the Federal Statutory Rate follows: July 31, 2025 July 31, 2024 Federal rate 21.0 % 21.0 % State net of federal 11.3 % 6.2 % Non-taxable change in fair value of warrant ( 0.3 )% ( 3.0 )% Sale of subsidiaries 24.8 % 0.0 % Loss on conversion of debt ( 7.3 )% 0.0 % Other permanent items 0.0 % ( 3.2 )% Valuation allowance ( 49.4 )% ( 21.0 )% Effective income tax rate 0.0 % 0.0 % The Company did not have any material uncertain tax positions. The Company's policy is to recognize interest and penalties accrued related to unrecognized benefits as a component income tax expense (benefit). The Company did not recognize any interest or penalties, nor did it have any interest or penalties accrued as of July 31, 2025 and July 31, 2024. Deferred income tax assets and (liabilities) consist of the following: July 31, 2025 July 31, 2024 Deferred tax assets (liabilities) Net operating loss carryforward $ 1,342,379 $ 1,032,100 Intangibles 1,006,915 109,946 Capital loss carryforward 177,439 - Depreciation - 1,851 Total deferred tax assets 2,526,733 1,143,897 Valuation allowance ( 2,526,733 ) ( 1,143,897 ) Net deferred taxes $ - $ - The Company has approximately $ 5.0 million of federal net operating loss carry forwards. These carry forward do not have an expiration date, and the full amount is subject to an 80 % limitation on the current year's taxable income. The Company has approximately $ 4.7 million of state net operating loss carry forwards to offset future taxable income in the states in which it currently operates. These carryforwards start expiring in 2029. F-17 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 Internal Revenue Code Section 382 limits the ability to utilize net operating losses if a 50% change in ownership occurs over a three-year period. Such limitation of the net operating losses may have occurred, but we have not analyzed it at this time as the deferred tax asset is fully reserved. During the twelve months ended July 31, 2025, the valuation allowance increased by $ 1,382,835 . The tax periods ending July 31, 2022 through 2024 are open for examination. NOTE 10 - STOCKHOLDERS' EQUITY (DEFICIT) Common Stock The holders of common stock are entitled to receive dividends whenever funds are legally available, when and if declared by the Company's Board of Directors. As of July 31, 2025, no cash dividend has been declared to date. Each share of common stock is entitled to one vote. On March 6, 2023, Mast Hill amended the terms of its promissory note, which included the issuance of 475,000 shares of the Company's common stock issued during the quarter ended October 31, 2023. On May 26, 2025 the Company and a related party lender entered into a debt exchange agreement (the "exchange"), pursuant to which the entire principal balance of the February 2021 Convertible Note was forgiven in exchange for 10,154,542 shares of common stock. As a result, the Company recognized a loss on conversion of $ 974,836 . Immediately prior to the exchange the February 2021 Convertible Note had a principal balance of $ 2,680,799 (Note 7 - Related Party Convertible Debt). Treasury Stock On November 1, 2024, the Viper Sale closed. As a result the Company sold its telecommunications assets to Viper, including 1st Point Communications LCC, and all its subsidiaries, Endstream Communications LLC, American Networks Inc., and a 10 % ownership interest in Wikibuli Inc. As consideration for the Viper Sale the Company received back 2,500,000 shares of the Company's common stock which was recorded as treasury stock (Note 3 - Discontinued Operations). The treasury stock from the Viper Sale was recorded at $ 0.25 per share, resulting in a total value of $ 625,000 . The Company utilizes the cost method of accounting to value treasury stock when repurchasing stock. Repurchases are reflected as reductions of stockholders' equity at cost. NOTE 11 - COMMITMENTS AND CONTINGENCIES From time to time, the Company may become subject to various legal proceedings that are incidental to the ordinary conduct of its business. Although the Company cannot accurately predict the amount of any liability that may ultimately arise with respect to any of these matters, it makes provision for potential liabilities when it deems them probable and reasonably estimable. These provisions are based on current information and legal advice and may be adjusted from time to time according to developments. As of July 31, 2025 the Company had accrued a liability of $ 26,000 due to trust fund recovery penalty ("TFRP") taxes which may be assessed against former directors or officers of the Company by the New Jersey Division of Taxation. Such former directors and officers may seek to be indemnified by the Company as a result of the TRFP taxes. The $ 26,000 accrual is recorded on the Company's Consolidated Balance Sheet as a component of accounts payable and accrued expenses. NOTE 12 - WARRANTS On February 11, 2022, the Company issued a purchase warrant (the "Mast First Warrant") to Mast Hill Fund, L.P. for 150,000 shares of the Company's common stock in conjunction with convertible debt (Note 8 - Convertible Debt). The warrants are exercisable for 5 years at $ 3.00 per share. The Company determined the Warrants should be classified as a liability as the warrants are redeemable for cash in the event of a fundamental transaction, as defined in the warrant agreement, which includes a change in control. F-18 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 On February 11, 2022, the Company issued a purchase warrant (the "Mast Second Warrant") to Mast Hill Fund, L.P. for 150,000 shares of the Company's common stock in conjunction with convertible debt (Note 8 - Convertible Debt). The warrants are exercisable for 5 years at $ 1.50 per share. The warrants were evaluated for purposes of classification between liability and equity and pursuant to ASC 480 the warrants were classified as liabilities. On August 14, 2024 the Company and Mast Hill agreed to extinguish the Mast Second Warrant. On February 17, 2022, the Company issued a purchase warrant to Talos Victory Fund, LLC for 75,000 shares of the Company's common stock in conjunction with convertible debt. The warrants are exercisable for 5 years at $ 1.50 per share. The warrants were evaluated for purposes of classification between liability and equity and pursuant to ASC 480 the warrants are classified as liabilities. On February 17, 2022, the Company issued a purchase warrant to Talos Victory Fund, LLC for 75,000 shares of the Company's common stock in conjunction with convertible debt. The warrants are exercisable for 5 years at $ 3.00 per share. The warrants were evaluated for purposes of classification between liability and equity and pursuant to ASC 480 the warrants are classified as liabilities. The following schedule summarizes the changes in the Company's common stock warrants during the years ended July 31, 2025 and 2024: Weighted Weighted Average Average Contractual Number of Exercise Term Warrants Price (Years) Balance outstanding at July 31, 2023 Granted 450,000 $ 2.25 3.54 Exercised - - - Expired/Canceled - - - Balance outstanding at July 31, 2024 450,000 $ 2.25 2.54 Granted - - - Exercised - - - Expired/Canceled ( 150,000 ) 1.50 - Balance outstanding at July 31, 2025 300,000 $ 2.63 1.54 Exercisable at July 31, 2024 300,000 $ 2.63 1.54 The fair values of the warrant liabilities during the years ended July 31, 2025 and 2024 were estimated using Black-Scholes option-pricing model with the following assumptions: July 31, 2025 2024 Exercise Price $ 1.50 - $ 3.00 $ 1.50 - $ 3.00 Risk-free interest rates 3.96 % 4.05 % - 4.90 % Expected life (in years) 1.55 2.54 Expected volatility 1,228 % 113 % - 868 % Dividend yield 0 % 0 % NOTE 13 - EARNINGS PER SHARE Basic income (loss) per common share is calculated by dividing net income (loss) available to common shareholders by the number of weighted average common shares issued and outstanding. Diluted income (loss) per common share is calculated by dividing net income (loss) available to common shareholders by the weighted average number of common shares issued and outstanding for the period, plus amounts representing the dilutive effect from the conversion of the convertible notes, as applicable. The Company calculates dilutive potential common shares for convertible securities using the as-if-converted method, which assumes the convertible securities will be converted as of the beginning of the period or the issuance date if later. The Company also calculates dilutive potential common shares using the treasury stock method for options and warrants. F-19 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 A reconciliation of the Company's basic and diluted income (loss) per common share is as follows: For the Years Ended, July 31, 2025 2024 Numerator: Net loss from continuing operations $ ( 4,429,910 ) $ ( 1,474,305 ) Net income from discontinued operations $ 1,632,517 $ 241,292 Net loss $ ( 2,797,393 ) $ ( 1,233,013 ) Denominator: Basic weighted average common shares outstanding 61,375,762 62,755,125 Effect of potentially dilutive convertible notes 886,795 3,318,100 Dilutive weighted average common shares outstanding 62,262,557 66,073,225 Net loss from continuing operations per common share: Basic $ ( 0.07 ) $ ( 0.02 ) Diluted $ ( 0.07 ) $ ( 0.02 ) Net income from discontinued operations per common share: Basic $ 0.03 $ 0.00 Diluted $ 0.03 $ 0.00 Net loss per common share: Basic $ ( 0.05 ) $ ( 0.02 ) Diluted $ ( 0.05 ) $ ( 0.02 ) The following potentially dilutive securities have been excluded from computations of dilutive weighted average shares outstanding as they would be anti-dilutive: July 31, 2025 July 31, 2024 Warrants 300,000 450,000 Convertible Notes - - Total 300,000 450,000 NOTE 14 - SEGMENT REPORTING The Company operates in one operating segment, and therefore one reportable segment, focused on providing digital stored value technology via its HammerPay mobile payments platform to enable digital commerce between consumers and branded merchants across the developing world. The accounting policies for the Company's single operating segment are the same as those described in the summary of significant accounting policies. The Company's Chief Executive Officer is the Chief Operating Decision Maker ("CODM"). The CODM manages the Company's business activities as a single operating and reportable segment at the consolidated level. Accordingly, our CODM uses consolidated net loss from continuing operations to allocate resources, and assess performance. The measure of segment assets is reported on the consolidated balance sheet as total consolidated assets. F-20 HAMMER TECHNOLOGY HOLDINGS CORP. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2025 AND 2024 The following is a summary of the significant revenue and expense categories, and consolidated net loss from continuing operations provided to the CODM: For the Years Ended, July 31, 2025 2024 Revenues $ - $ 420 Less: Significant and other segment expenses Selling, general and administrative expenses ( 842,609 ) ( 728,714 ) Depreciation and amortization expense ( 677,723 ) ( 673,193 ) Intangible asset impairment ( 1,888,242 ) - Interest expense ( 1,500 ) ( 86,043 ) Warrant financing expense - ( 164,525 ) Change in fair value of warrant liability ( 45,000 ) 177,750 Loss on conversion of debt ( 974,836 ) - Net loss from continuing operations $ ( 4,429,910 ) $ ( 1,474,305 ) NOTE 15 - SUBSEQUENT EVENTS Effective September 3, 2025, the Company amended its Articles of Incorporation to effect a change of the Company's name from "Hammer Fiber Optics Holdings Corp." to "Hammer Technology Holdings Corp." (the "Name Change"). The Name Change does not affect the Company's ticker symbol (HMMR) or the CUSIP number for the Company's outstanding shares of common stock. Between August 1, 2025 and October 23, 2025 the Company received $ 150,000 in proceeds pursuant to the May 2025 Convertible Note (Note 7 – Related Party Convertible Debt). Effective August 9, 2025, four related party convertible party notes with a total principal balance of $ 61,800 were forgiven by their holders (Note 7 – Related Party Convertible Debt). As a result, the principal balance owed due to these convertible notes was reduced to $ 0 and a gain on extinguishment recognized on the statement of operations. F-21 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL STATEMENTS a) Dismissal of Fruci & Associates II, PLLC ("Fruci") On February 20, 2025, the Board of Directors of the Company approved the dismissal of Fruci & Associates II, PLLC ("Fruci") as its independent registered public accounting firm. During the Company's two most recent fiscal years ended July 31, 2024 and 2023 and the subsequent interim periods through February 18, 2025, there were no disagreements as defined in Item 304 of Regulation S-K with Fruci on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Fruci, would have caused it to make reference in connection with any opinion to the subject matter of the disagreement. Further, there were no reportable events (as defined in Item 304(a)(1)(v) of Regulation S-K). (b) Engagement of Salberg & Company, P.A. ("Salberg") On February 20, 2025, the Board of Directors approved the appointment of Salberg & Company, P.A. ("Salberg"), an independent registered public accounting firm which is registered with, and governed by the rules of, the Public Company Accounting Oversight Board, as our independent registered public accounting firm. During our two most recent fiscal years through July 31, 2024, and the subsequent interim periods through February 20, 2025, neither us nor anyone on our behalf consulted Salberg regarding either (1) the application of accounting principles to a specified transaction regarding us, either completed or proposed, or the type of audit opinion that might be rendered on our financial statements; or (2) any matter regarding us that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and related instructions to Item 304 of Regulation S-K) or a reportable event (as defined in Item 304(a)(1)(v) of Regulation S-K).