SUI Group Holdings Ltd. 10-K

ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Item Page Reports of Independent Registered Public Accounting Firm (PCAOB ID: 542 ) F-2 Balance Sheets — December 31, 2025 and December 31, 2024 F-4 Statements of Operations — Years ended December 31, 2025 and December 31, 2024 F-5 Statements of Shareholders’ Equity — Years ended December 31, 2025 and December 31, 2024 F-6 Statements of Cash Flows — Years ended December 31, 2025 and December 31, 2024 F-7 Investment Schedules — December 31, 2024 F-8 Notes to Financial Statements F-9 F-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of Sui Group Holdings Limited Opinion on the Financial Statements We have audited the accompanying balance sheets of Sui Group Holdings Limited, formerly Mill City ventures III, LTD (the Company) as of December 31, 2025 and 2024, including the related statements of operations, shareholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2025, and the related notes and the investment schedule as of December 31, 2024 (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 2024, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2025, 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 audits. 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 audits 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 audits, 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 audits 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 audits 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 audits provide a reasonable basis for our opinion. Emphasis of Matter – Investment Valuation As explained in Note 6 to the financial statements, the accompanying financial statements include investments valued at $13,658,097 and $13,006,231 as of December 31, 2025 and 2024, respectively, whose fair values have been estimated by management in absence of readily determinable fair values. Such estimates are based on financial and other information provided by management of its portfolio companies and pertinent market and industry data. The investments are valued based on unobservable inputs as of December 31, 2025 and 2024. Because such valuations, and particularly valuations of private investments and private companies, are inherently uncertain, they may fluctuate significantly over short periods of time. These determinations of fair value could differ materially from the values that would have been utilized had a ready market for these investments existed. F-2 Table of Contents Critical Audit Matters The critical audit matters communicated below 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. The communication of critical audit matters does not alter in any way our opinion on the 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. Description of the Matter Valuation of portfolio investments which utilize significant unobservable inputs and digital asset loan receivables associated with credit allowances At December 31, 2025, the balances of the Company’s investments, at fair value, categorized as Level 3 within the fair value hierarchy totaled $13,658,097 and the credit allowance assigned to the digital asset loan receivables totaled $548,144. The values are determined by management using the valuation techniques and significant unobservable inputs described in Notes 2, 4, 5, and 6 to the financial statements. Auditing the values of the Company’s investments categorized as Level 3 within the fair value hierarchy and the credit allowance associated with the digital asset loan receivables was complex and involved a high degree of auditor subjectivity and judgement due to the estimation uncertainty resulting from the unobservable nature of the inputs used in the valuations and the limited number of comparable market transactions for the same or similar investments. How We Addressed the Matter in our Audit We obtained an understanding and evaluated the design of controls over the Company’s valuation and estimate process, including management’s assessment of the significant inputs and estimates used in the fair value and credit allowance measurements. We performed the following procedures, among others, for the Company’s Level 3 investments and credit allowance associated with the digital asset loan receivables: · We evaluated the valuation techniques used by the Company and considered the consistency in application of the valuation techniques to each subject investment and investment class. · We assigned senior, more experienced audit team members to perform audit procedures related to the valuation of investments. · We evaluated the reasonableness of the significant unobservable inputs by comparing the inputs used by the Company to third-party sources, if available, such as market indexes or other market data. · We considered the other information obtained during the audit that corroborated or contradicted the Company’s inputs or fair value measurements. · For investments sold during the year or subsequent to year-end, we compared the transaction price to the Company’s fair value estimate to assess the reasonableness of management’s fair value estimates. · We compared the available market data related to credit losses to the data and assumptions utilized by the Company. /s/ Boulay PLLP We have served as the Company’s auditor since 2019. Boulay PLLP Minneapolis, MN February 27, 2026 F-3 Table of Contents SUI GROUP HOLDINGS LIMITED BALANCE SHEETS December 31, 2025 December 31, 2024 Assets Current Assets Cash and cash equivalents $ 21,936,274 $ 6,026,110 Portfolio investments, at fair value (cost: $ 7,460,216 and 4,369,722 13,453,561 $ 13,717,089 , respectively) Digital asset loan receivable, at fair value (cost: $ 3,399,860 and $ 0 ) 1,305,342 — Interest and dividend receivable 757,794 191,917 Digital assets receivable, at fair value (cost: $ 53,565 and $ 0 ) 28,774 — Prepaid expenses 1,806,222 31,848 Income tax receivable 131,360 — Deferred taxes — 770,000 Total current assets 30,335,488 20,473,436 Digital assets, at fair value (cost: $ 401,991,599 and $ 0 ) 147,415,273 — Portfolio investments, at fair value (cost: $ 10,000,000 and $ 0 ) 10,244,122 — Digital asset loan receivable, at fair value (cost: $ 4,682,300 and $ 0 ) 2,306,203 — Other assets 63,890 — Total Assets $ 190,364,976 $ 20,473,436 Liabilities and Shareholders' Equity Current Liabilities Accounts payable 857,341 41,105 Deferred income 11,858,820 — Accrued payroll liabilities 1,250 527,142 Accrued income tax - 147,200 Total current liabilities 12,717,411 715,447 Long Term Liabilities Deferred income 7,905,886 — Total long term liabilities 7,905,886 — Total liabilities $ 20,623,297 $ 715,447 Shareholders' Equity Common Stock, par value $ 0.001 per share ( 2,000,000,000 authorized; 76,803 6,385 76,802,872 and 6,385,255 issued and outstanding, respectively) Additional paid-in capital 431,799,677 16,933,330 Accumulated deficit ( 262,134,801 ) ( 1,159,665 ) Accumulated undistributed investment gain (loss) — ( 152,389 ) Accumulated undistributed net realized gains on investment transactions — 4,393,855 Net unrealized depreciation in value of investments — ( 263,527 ) Total shareholders' equity 169,741,679 19,757,989 Total liabilities and shareholders' equity $ 190,364,976 $ 20,473,436 See accompanying Notes to Financial Statements F-4 Table of Contents SUI GROUP HOLDINGS LIMITED STATEMENTS OF OPERATIONS Year Ended December 31, 2025 December 31, 2024 Revenues Portfolio investment income $ 1,726,061 $ 3,301,119 Digital lending interest income 83,517 — SUI staking revenue 2,089,053 — Total Revenues 3,898,631 3,301,119 Operating Expenses Professional fees 2,766,442 550,248 Stock-based Compensation 4,431,781 — Asset and strategic management fees 1,614,717 — Compensation expense 1,091,708 1,233,157 Insurance 773,939 99,936 Unrealized loss on digital assets, net 253,582,413 — Realized loss on digital assets 3,292,227 — Provision for digital asset loan credit losses 548,144 — Net realized and unrealized gain on portfolio investments ( 476,986 ) ( 267,932 ) Other general and administrative 311,741 92,534 Total Operating Expenses 267,936,126 1,707,943 Operating Income (Loss) $ ( 264,037,495 ) $ 1,593,176 Other Income/(Loss) Portfolio investment income 2,887,486 — Net realized and unrealized loss on portfolio investments ( 3,059,626 ) — Total Other Loss ( 172,140 ) — Income (Loss) Before Taxes $ ( 264,209,635 ) $ 1,593,176 Provision for (Benefit from) Income Taxes 743,440 425,450 Net Income (Loss) $ ( 264,953,075 ) $ 1,167,726 Earnings per Share Basic $ ( 6.59 ) $ 0.18 Diluted $ ( 6.59 ) $ 0.18 Weighted-average number of common shares outstanding - basic 40,212,397 6,385,255 Weighted-average number of common shares outstanding - diluted 40,212,397 6,492,275 See accompanying Notes to Financial Statements F-5 Table of Contents SUI GROUP HOLDINGS LIMITED STATEMENTS OF SHAREHOLDERS EQUITY Year Ended December 31, 2025 Common Shares Par Value Additional Paid In Capital Accumulated Deficit Accumulated Undistributed Net Portfolio Investment Gain (Loss) Accumulated Undistributed Net Realized Gain on Portfolio Investments Transactions Net Unrealized Depreciation in value of Portfolio Investments Total Shareholders' Equity Balance as of December 31, 2024 6,385,255 $ 6,385 $ 16,933,330 $ ( 1,159,665 ) $ ( 152,389 ) $ 4,393,855 $ ( 263,527 ) $ 19,757,989 Issuance of shares and warrants in private offering, net of issuance costs of $21,192,358 75,881,625 75,882 428,731,711 — — — — 428,807,593 Exercise of stock options and warrants 3,254,554 3,255 625,654 — — — — 628,909 Stock-based Compensation — — 4,431,781 — — — — 4,431,781 Repurchase of common shares ( 8,718,562 ) ( 8,719 ) ( 18,922,799 ) — — — — ( 18,931,518 ) Undistributed net portfolio investment gain — — — — 651,795 — — 651,795 Undistributed net realized gain on portfolio investment transactions — — — — — 205 — 205 Depreciation in value of portfolio investments — — — — — 476,781 476,781 Cumulative effect of ASC 946 derecognition — — — 5,106,720 ( 499,406 ) ( 4,394,060 ) ( 213,254 ) — Net loss — — — ( 266,081,856 ) — — — ( 266,081,856 ) Balance as of December 31, 2025 76,802,872 $ 76,803 $ 431,799,677 $ ( 262,134,801 ) $ — $ — $ — $ 169,741,679 Year Ended December 31, 2024 Common Shares Par Value Additional Paid In Capital Accumulated Deficit Accumulated Undistributed Net Investment Gain (Loss) Accumulated Undistributed Net Realized Gain (Loss) on Investment Transactions Net Unrealized Appreciation (Depreciation) in Value of Investments Total Shareholders' Equity Balance as of December 31, 2023 6,385,255 $ 6,385 $ 16,933,330 $ ( 1,159,665 ) $ ( 1,052,183 ) $ 5,155,200 $ ( 1,292,804 ) $ 18,590,263 Undistributed net portfolio investment gain — — — 899,794 — — 899,794 Undistributed net realized gain on portfolio investment transactions — — — — ( 761,345 ) — ( 761,345 ) Appreciation in value of portfolio investments — — — — — 1,029,277 1,029,277 Balance as of December 31, 2024 6,385,255 $ 6,385 $ 16,933,330 $ ( 1,159,665 ) $ ( 152,389 ) $ 4,393,855 $ ( 263,527 ) $ 19,757,989 See accompanying Notes to Financial Statements F-6 Table of Contents SUI GROUP HOLDINGS LIMITED STATEMENTS OF CASH FLOWS Year Ended December 31, 2025 December 31, 2024 Cash flows from operating activities: Net income (loss) $ ( 264,953,075 ) $ 1,167,726 Adjustments to reconcile net income (loss) to net cash provided (used) in operating activities: Deferred income taxes 770,000 ( 13,000 ) Unrealized loss on digital assets, net 253,582,413 — Realized loss on digital assets 3,292,227 — Net realized and unrealized loss/ (gain) on portfolio investments 2,582,640 ( 267,932 ) Provision for digital asset loan credit losses 548,144 Staking revenue ( 2,035,488 ) — Digital lending revenue ( 77,928 ) Stock-based Compensation 4,431,781 — Purchases of investments ( 4,428,530 ) ( 5,665,526 ) Proceeds from sales of investments 504,116 9,764,573 Changes in operating assets and liabilities: Prepaid expenses ( 1,838,264 ) 142,736 Interest and dividend receivable ( 565,877 ) 72,496 Digital assets receivable ( 59,154 ) — Note receivable — 250,000 Accounts payable and other liabilities 290,344 51,813 Accrued income tax ( 278,560 ) 147,200 Net cash provided (used) in operating activities ( 8,235,211 ) 5,650,086 Cash flows from investing activities: Purchases of portfolio investments ( 3,818,608 ) — Proceeds from sales and repayments of portfolio investments 4,000,100 — Purchases of digital assets ( 195,540,001 ) — Net cash provided (used) in investing activities ( 195,358,509 ) — Cash flows from financing activities: Proceeds from common shares and warrants issued in private offering 258,998,851 — Issuance costs of private offering ( 21,192,358 ) — Proceeds from option and warrant exercise 628,909 — Payments for repurchase of common stock ( 18,931,518 ) — Net cash provided in financing activities 219,503,884 — Net increase in cash and cash equivalents 15,910,164 5,650,086 Cash and cash equivalents, beginning of period 6,026,110 376,024 Cash and cash equivalents, end of period $ 21,936,274 $ 6,026,110 Supplemental disclosure of cash flow information: Cash paid for income taxes $ — $ 159,750 Cash paid for interest $ — $ 320 Non-cash investing and financing activities: In-kind digital assets contribution for equity and warrants in private offering $ 191,001,099 $ — In-kind digital assets acquired $ ( 191,001,099 ) $ — Digital assets loan receivable $ 8,076,572 $ — See accompanying Notes to Financial Statements F-7 Table of Contents SUI GROUP HOLDINGS LIMITED Investment Schedule As of December 31, 2024 Investment / Industry Cost Fair Value Percentage of Net Assets Short-Term Non-banking Loans Business Services - 15% secured loans Mustang Litigation Funding $ 10,000,000 $ 9,985,925 50.54 % Consumer - 18% secured loans 500,000 504,308 2.55 % Real Estate - 15% secured loans Alatus Development Corp 2,000,000 2,016,636 10.21 % Real Estate - 24% secured loans Coventry Holdings LLC 500,000 499,362 2.53 % Total Short-Term Non-Banking Loans 13,000,000 13,006,231 65.83 % Common Stock Consumer 3,911 4,466 0.02 % Financial 553,178 442,864 2.24 % Information Technology 150,000 - 0.00 % Total Common Stock 707,089 447,330 2.26 % Other Equity Financial 10,000 - 0.00 % Total Investments $ 13,717,089 $ 13,453,561 68.09 % Total Cash and cash equivalents 6,026,110 6,026,110 30.50 % Total Investments and Cash $ 19,743,199 $ 19,479,671 98.59 % See accompanying Notes to Financial Statements F-8 Table of Contents NOTE 1 — ORGANIZATION Sui Group Holdings Limited (the “Company”, “Sui Group”, or “we”), formerly known as Mill City Ventures III, Ltd., is a Minnesota corporation headquartered in Wayzata, Minnesota. The Company changed its name to Sui Group Holdings Limited on August 26, 2025, following an amendment to our Articles of Incorporation filed with the Office of the Minnesota Secretary of State. This name change and concurrent rebranding coincide with a change in strategy toward digital asset treasury management. Prior to the rebrand, the Company operated under the name Mill City Ventures III, Ltd. as a publicly traded specialty finance company listed on Nasdaq under the ticker symbol “MCVT”. Its legacy business centered on issuing short-term, collateralized loans to small businesses and individuals, with a focus on generating high-yield returns. To support the digital asset treasury strategy, the Company completed a $ 450 million private placement in July 2025 (the “Private Placement”). Following the Private Placement, the Company began implementing its SUI treasury strategy, acquiring over 74 million SUI tokens and generating 1.0 million SUI tokens from staking and other lending activities in addition to the 33 million tokens received as in-kind consideration from the Private Placement. To further institutionalize its position within the Sui ecosystem, the Company formalized its relationship with the Sui Foundation through the Digital Asset Purchase and Sale Agreement (the “Digital Asset Purchase Agreement”), under which the Sui Foundation agreed to sell 44 million SUI tokens at a discounted purchase price equal to 85% of the twenty-four-hour time-weighted average price (“TWAP”) of SUI tokens on July 31, 2025. The Digital Asset Purchase Agreement provides formal recognition of the Company as a digital asset treasury company with backing from the Sui Foundation. In connection with this strategy, the Company changed its ticker symbol to “SUIG” and transitioned its operations to focus on institutional-grade exposure to the SUI digital asset. The Company’s strategy is to maximize the value of SUI per-share and support the growth of the Sui ecosystem through scalable, transparent, and long-term value creation strategies. Its Common Stock remains listed on the Nasdaq Capital Market and continues to be available for options trading on Cboe Global Markets. NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation : The accompanying Financial Statements have been prepared in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) which is the source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with Generally Accepted Accounting Principles (“GAAP”) in the United States. Change in application of ASC 946: As discussed in “Note 1 — Organization”, the Company changed its strategy during the quarter ended September 30, 2025 and as a result no longer meets the definition of an investment company under ASC 946 – Financial Services – Investment Companies. Accordingly, the Company discontinued the application of ASC 946 and is accounting for this change on a prospective basis. Use of estimates: The preparation of financial statements in conformity with GAAP requires management and our independent Board members to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the date of the financial statements, as well as the reported amounts of expenses during the reporting period. Significant estimates and assumptions include, but are not limited to, the determination of the fair value of investment assets, which involves the use of observable and unobservable market inputs which is based on management’s evaluation of available positive and negative evidence, including historical operating results and expectations of future taxable income. Actual results could differ from those estimates. Cash and cash equivalents: The Company maintains the cash balances in financial institutions and with regulated financial investment brokers. The Company considers all highly liquid investments purchased with an original maturity date of three months or less to be cash equivalents. Cash equivalents as of December 31, 2025 include $ 2,249,758 of USD Coins (USDC), a stablecoin pegged to the U.S. dollar. F-9 Table of Contents Digital assets: The Company has adopted Accounting Standards Update (“ASU”) 2023-08, Digital Assets, which provides guidance on the recognition, measurement, presentation, and disclosure of digital assets. The standard was adopted prospectively, and no cumulative-effect adjustment was recorded upon adoption. The Company accounts for its digital assets, including SUI tokens, in accordance with ASC 350 – Intangibles – Goodwill and Other. The Company has determined its digital assets meet the scoping criteria of ASC 350-60, which requires eligible cryptocurrency assets to be measured at fair value, with changes in fair value recognized in net income. Fair value is determined in accordance with ASC 820 – Fair Value Measurement, using quoted prices in active markets. The Company has designated Coinbase as its principal market because it has the greatest volume and level of activity of SUI for determining the fair value of SUI tokens. The activity from remeasurement of digital assets at fair value is reflected in the statements of operations within unrealized gain (loss) on digital assets. Realized gains and losses from the derecognition of digital assets are presented within realized gain (loss) on digital assets in the statements of operations. The Company uses the specific identification method to calculate the realized gains (losses) on digital assets. Sales and purchases of digital assets are reflected as cash flows from investing activities in the statement of cash flows. Contributions of digital assets received as part of the consideration received are presented as noncash investing and financing activities in the statements of cash flows. Non‑cash disposals of digital assets that occur in connection with loan arrangements are accounted for consistent with the policies described in the digital asset loan receivables section below, which provides additional detail on the treatment of digital assets transferred pursuant to such agreements. Digital asset loan receivables : The Company enters into digital asset lending arrangements in the ordinary course of business, whereby digital assets are loaned to the borrowers in exchange for a fee in accordance with the terms of the lending arrangement. Upon origination, the digital assets loaned are derecognized at their carrying amount and a corresponding digital asset loan receivable is recognized at fair value. Subsequently, a digital asset loan receivable is remeasured at fair value on each reporting date using quoted prices from the Company’s principal market for the underlying digital asset, in accordance with ASC 820. Gains and losses associated with the derecognition of the SUI tokens is included in “Realized loss on digital assets” on the statements of operations. Subsequent change in the fair value of the digital asset loan receivable is recognized as “Unrealized loss on digital assets” on the statements of operations. Fees earned on digital asset loan receivables are recognized as revenue under “Digital lending interest income” on the statements of operations. The exchange of digital assets loaned for digital asset loan receivable is disclosed as a noncash investing activity. Fair value gains and losses are presented as reconciling items in the reconciliation of net income to net cash flows from operating activities. The Company regularly evaluates its credit exposure to borrowers to determine whether an allowance for credit losses is required under ASC 326, Financial Instruments – Credit Losses (CECL). The allowance reflects management’s assessment of borrower creditworthiness, collateral volatility, and liquidity conditions in digital asset markets. Valuation of portfolio investments : In connection with the change in accounting methods from ASC 946 - Financial Services - Investment Companies during the third quarter of 2025, the Company ceased applying investment company accounting and transitioned to accounting standards applicable to operating entities, in light of the change in its business model. Concurrently, the Company elected to apply the fair value option under ASC 825 - Financial Instruments, as it relates to the Company’s portfolio investments. The change in accounting policy has been applied prospectively from the date of the election of ASC 825 – Financial Instruments. Portfolio investments are valued in accordance with ASC Topic 820 - Fair Value Measurements, which defines fair value, establishes a framework for measuring fair value, and requires disclosures about fair value measurements. Fair value is generally based on quoted market prices provided by independent pricing services, broker or dealer quotations, or alternative price sources. In the absence of quoted market prices, broker or dealer quotations, or alternative price sources, investments are measured at fair value as determined by the Company’s Board based on, among other things, the input of our executive management, the Audit Committee of the Board, and any independent third-party valuation experts that may be engaged by management to assist in the valuation of our portfolio investments, but in all cases consistent with our written valuation policies and procedures. F-10 Table of Contents Due to the inherent uncertainties of valuation, certain estimated fair values may differ significantly from the values that would have been realized had a ready market for these investments existed, and these differences could be material. In addition, such investments are generally less liquid than publicly traded securities. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we could realize significantly less than the value at which we have recorded it. Accounting guidance establishes a hierarchal disclosure framework that prioritizes and ranks the level of market price observability of inputs used in measuring investments at fair value. Observable inputs must be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability based on market data obtained from independent sources. Unobservable inputs are inputs that reflect our assumptions about the factors market participants would use in valuing the asset or liability based upon the best information available. Assets and liabilities measured at fair value are categorized into one of the three hierarchy levels based on the relative observability of inputs used in the valuation. The three levels are defined as follows: · Level 1: Observable inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities. · Level 2: Observable inputs based on quoted prices for similar assets and liabilities in active markets, or quoted prices for identical assets and liabilities in inactive markets. · Level 3: Unobservable inputs that reflect an entity’s own assumptions about what inputs a market participant would use in pricing the asset or liability based on the best information available in the circumstances. Our valuation policy and procedures for portfolio investments : Under our valuation policies and procedures, we evaluate the source of inputs, including any markets in which our investments are trading, and then apply the resulting information in determining fair value. For our Level 1 investment assets, our valuation policy generally requires us to use a market approach, considering the last quoted closing price of a security we own that is listed on a securities exchange, and in a case where a security we own is listed on an over-the-counter market, to average the last quoted bid and ask price on the most active market on which the security is quoted. In the case of traded debt securities, the prices for which are not readily available, we may value those securities using a discounted cash flows approach, at their weighted-average yield to maturity. The estimated fair value of our Level 3 investment assets is determined on a quarterly basis by the Company. In general, we value our Level 3 equity investments at cost unless circumstances warrant a different approach. Examples of these circumstances includes a situation in which a portfolio company has engaged in a subsequent financing of more than a de minimis size involving sophisticated investors (in which case we may use the price involved in that financing as a determinative input absent other known factors), or when a portfolio company is engaged in the process of a transaction that we determine is reasonably likely to occur (in which case we may use the price involved in the pending transaction as a determinative input absent other known factors). Other facts and circumstances that may serve as an input supporting a change in the valuation of our Level 3 equity investments include (i) a third-party valuation conducted by an independent and qualified professional, (ii) changes in the performance of long-term financial prospects of the portfolio company, (iii) a subsequent financing that changes the distribution rights associated with the equity security we hold, or (iv) sale transactions involving comparable companies, but only if further supported by a third-party valuation conducted by an independent and qualified professional. When valuing preferred equity investments, we generally view intrinsic value as a key input. Intrinsic value means the value of any conversion feature (if the preferred investment is convertible) or the value of any liquidation or other preference. Discounts to intrinsic value may be applied in cases where the issuer’s financial condition is impaired or, in cases where intrinsic value relating to a conversion is determined to be a key input, to account for resale restrictions applicable to the securities issuable upon conversion. For non-traded (Level 3) debt instruments with a residual maturity less than or equal to 60 days, we will generally value such instruments based on a discounted cash flows approach, considering the straight-line amortized face value of the debt unless justification for impairment exists. For Level 3 non-banking loans with a maturity in excess of 60 days, fair value is determined based on the initial purchase price and adjusted as necessary to reflect any changes in the financial strength of the creditor and changes in interest rates in the high-yield credit markets. F-11 Table of Contents On a quarterly basis, our management provides members of the Board with recommendations, if any, to change any existing valuations of our portfolio investments or hierarchy levels for purposes of determining the fair value of such investments based upon the foregoing. In such a case, the Board would then discuss these materials and, consistent with the policies and approaches outlined above, make final determinations respecting the valuation and hierarchy levels of our portfolio investments. We made no changes to our valuation policy and procedures during the reporting period. Income taxes: We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities using enacted tax rates in effect for the tax year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income for the period that includes the enactment date. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such determination, we consider all available evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies, and recent financial operations. In the event we were to determine we would not be able to realize our deferred income tax assets, we would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. We file income tax returns in the U.S. federal jurisdiction and various state jurisdictions. The Company does not believe there will be any material changes in its unrecognized tax positions over the next 12 months. Our evaluation was performed for the tax years ended December 31, 2022 through 2024, which are the tax years that remain subject to examination by the tax jurisdictions as of December 31, 2025. Revenue recognition : Portfolio Investment: Realized gains or losses on the sale of investments are calculated using the specific investment method. Interest income, adjusted for amortization of premiums and accretion of discounts, is recorded on an accrual basis. Discounts from and premiums to par value on securities purchased are accreted or amortized, as applicable, into interest income over the life of the related security using the effective-yield method. The amortized cost of investments represents the original cost, adjusted for the accretion of discounts and amortization of premiums, if any. Loans are generally placed on non-accrual status when principal or interest payments are past due 30 days or more, or when there is reasonable doubt that principal or interest will be collected in full. Loan origination fees are recognized when loans are issued. Accrued and unpaid interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment regarding collectability. Non-accrual loans are restored to accrual status when past-due principal and interest is paid and, in management’s judgment, are likely to remain current. We may make exceptions to the policy described above if a loan has sufficient collateral value and is in the process of collection. Dividend income on preferred equity securities is recorded as dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies. Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK represents accrued interest or accumulated dividends that are added to the loan principal or stated value of the investment on the respective interest- or dividend-payment dates rather than being paid in cash and generally becomes due at maturity or upon being repurchased by the issuer. PIK interest or dividends is recorded as interest or dividend income, as applicable. If at any point we believe that PIK interest or dividends is not expected be realized, the PIK-generating investment will be placed on non-accrual status. Accrued PIK interest or dividends are generally reversed through interest or dividend income, respectively, when an investment in placed on non-accrual status. F-12 Table of Contents SUI staking revenue : Beginning in August 2025, the Company engaged in SUI staking activities. This can include native staking, liquid staking and restaking. The Company has entered into separate contractual agreements with various third-party entities to facilitate its SUI staking activities and has only engaged in native staking during the third and fourth quarters of 2025. The Company intends for staking to become a primary revenue generation strategy of the Company within the upcoming fiscal year. The Company earns revenue primarily through staking activities involving its digital asset holdings. Under its SUI treasury strategy, the Company delegates SUI tokens, to third-party validator nodes to participate in proof-of-stake blockchain protocols. These arrangements support the operation and security of the underlying blockchain networks and generate staking rewards as compensation. In accordance with ASC 606 - Revenue from Contracts with Customers, the Company evaluated whether it acts as a principal or an agent in these arrangements. The specified service in staking is the performance of validation activities, which are executed by the validator infrastructure. The validator is selected by the blockchain protocol to perform transaction validation and is responsible for operating the necessary hardware and software, bearing the associated operational and investment risks. Although the Company retains ownership and custody of the staked digital assets and receives staking rewards directly from the blockchain protocol, it does not control or perform the validation service. Based on the control and performance obligation criteria under ASC 606 - Revenue from Contracts with Customers, the Company concluded that it does not control the specified service prior to its transfer to the customer. As such, the Company acts as an agent in these arrangements. Accordingly, staking rewards in the form of SUI tokens are recognized on a net basis as non-cash consideration for staking activities, measured at the fair value of the digital assets at the inception of the contract term, reflecting only the portion attributable to the Company for delegating its tokens. Allocation of net gains and losses: All income, gains, losses, deductions and credits for any investment are allocated in a manner proportionate to the shares owned. Stock-based Compensation: The Company's Stock-based Compensation consists of stock options and warrants issued to certain employees, non-employees and directors of the Company. The Company recognizes compensation expense based on an estimated grant date fair value using the Black Scholes option-pricing method or Monte Carlo simulation. If the factors change and different assumptions are used, the Company's Stock-based Compensation expense could be materially different in the future. The Company recognizes Stock-based Compensation expense for these options and warrants on a straight-line basis over the requisite service period. The Company has elected to account for forfeitures as they occur. Warrants : The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the instruments’ specific terms and applicable authoritative guidance in ASC 480 – Distinguishing Liabilities from Equity and ASC 815 – Derivatives and Hedging. The assessment considers whether the instruments are freestanding financial instruments pursuant to ASC 480 – Distinguishing Liabilities from Equity, meet the definition of a liability pursuant to ASC 480 – Distinguishing Liabilities from Equity, and whether the instruments meet all of the requirements for equity classification under ASC 815 – Derivatives and Hedging, including whether the instruments are indexed to the Company’s Common Stock and whether the instrument holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. Please refer to “Note 7 — Shareholders’ Equity” and “Note 8 — Share-Based Compensation” for further details of the warrants issued on July 31, 2025 with the PIPE Transaction. Reclassifications : Certain prior‑period amounts have been reclassified to conform to the current‑year financial statement presentation. These reclassifications primarily relate to the aggregation of previously separate operating expense line items into a single financial statement line within the statements of operations. The reclassifications had no impact on previously reported total assets, total liabilities, shareholders’ equity, net income (loss), or cash flows, and no changes were made to the underlying prior‑year balances. F-13 Table of Contents Recently adopted accounting pronouncements: During the year ended December 31, 2025, the Company adopted new accounting pronouncements issued by FASB that are effective and applicable to its financial reporting. These include, as applicable: · ASU 2023‑08 - Intangibles - Goodwill and Other- Cryptocurrency Assets (Subtopic 350‑60) - The standard requires certain cryptocurrency assets that meet the scope criteria of intangible assets to be measured at fair value, with changes in fair value recognized in net income, and presented separately from other intangible assets. · ASU 2025‑05 - Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets - The amendments clarify the application of the CECL model for certain receivables, including digital asset receivables that qualify as financial assets. Early adoption did not have a material impact on the Company’s allowance for credit losses. · ASU 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures - enhances the transparency of income tax disclosures, requiring additional disaggregation in the rate reconciliation and details about income taxes paid by jurisdiction; effective for annual periods beginning after December 15, 2025 for entities other than public business entities, with earlier adoption permitted. The Company has adopted ASU 2023-09 for the year ended December 31, 2025 on a prospective basis. As of the date of this filing, the FASB has issued, and the Company is evaluating, the following accounting standards updates that are not yet effective. The Company is assessing the potential impact of each on its financial statements and related disclosures: · ASU 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures - enhances the transparency of income tax disclosures, requiring additional disaggregation in the rate reconciliation and details about income taxes paid by jurisdiction; effective for annual periods beginning after December 15, 2025, for entities other than public business entities, with earlier adoption permitted. · ASU 2024‑03, Income Statement - Reporting Comprehensive Income - Disaggregation of Income Statement Expenses (Subtopic 220‑40) - requires additional disclosure of specified expense categories in the notes; effective for annual periods beginning after December 15, 2026 (interim periods thereafter), with early adoption permitted. · ASU 2025‑06, Intangibles - Goodwill and Other - Internal‑Use Software (Subtopic 350‑40): Targeted Improvements to the Accounting for Internal‑Use Software - simplifies the guidance on internal‑use software capitalization; effective for annual periods beginning after December 15, 2027. NOTE 3 — DIGITAL ASSETS On July 27, 2025, the Company entered into the Digital Asset Purchase Agreement with the Sui Foundation, whereby the Company acquired approximately 44 million SUI tokens at a discounted purchase price equal to 85 % of the twenty-four-hour time-weighted average price (“TWAP”) of SUI tokens on July 31, 2025. The SUI tokens acquired under the Digital Asset Purchase Agreement are subject to contractual sales and transfer restrictions for a period of two years plus 30 days following July 31, 2025 (the “Restricted Period”). During the Restricted Period, the Company is prohibited from selling, transferring, or otherwise disposing of the Digital Asset Purchase Agreement Tokens. However, the Company may stake the Digital Asset Purchase Agreement Tokens on the Sui network to participate in network validation and earn staking rewards. The contractual restrictions are scheduled to expire on August 30, 2027, at which time the Company will obtain full transferability of the Digital Asset Purchase Agreement Tokens. The Digital Asset Purchase Agreement obliges the Company to use one half of all cash raised after the PIPE transaction to offer to purchase additional SUI from the Sui Foundation, subject to the terms and conditions of the agreement. In addition, the Sui Foundation has the option to sell to the Company up to one hundred percent (100%) of the total dollar amount of SUI acquired by the Company in certain market purchases. Any such sales by the Sui Foundation would be subject to specified conditions, including a 15% discount to prevailing market prices. No other events or circumstances under the Digital Asset Purchase Agreement would permit the early release or modification of the restrictions. The total purchase price of the Digital Asset Purchase Agreement Tokens was $ 140,000,000 , reflecting a discount of $ 24,705,882 . The 15 % discount on the acquisition of the Digital Asset Purchase Agreement Tokens is recorded as deferred income within liabilities in the balance sheet and is recognized as an increase to unrealized gain or a reduction to unrealized loss on digital asset investments using the straight-line method over the Restricted Period. As of December 31, 2025, the current deferred income liability of $ 11,858,820 and the long term deferred income liability of $ 7,905,886 related to the remaining balance of the deferred income associated with discount on the acquisition of the Digital Asset Purchase Agreement Tokens. For the year ended December 31, 2025, the Company recognized amortized deferred income of $ 4,941,176 as a reduction to unrealized losses on digital asset investments. F-14 Table of Contents The following table presents the activities in digital assets for the year ended December 31, 2025: For the year ended December 31, 2025 Digital Assets Number of Tokens Balance Balance as of January 1, 2025 — $ — Purchases/acquisitions 107,225,928 411,246,982 Disposals/sales related to digital asset lending ( 2,961,550 ) ( 8,076,572 ) Realized loss on disposals/sales — ( 3,292,227 ) Staking rewards earned 779,439 2,035,487 Lending rewards earned 42,634 77,928 Unrealized losses — ( 254,576,325 ) Balance as of December 31, 2025 105,086,451 $ 147,415,273 Digital assets are measured at fair value on a recurring basis in accordance with ASC 820, Fair Value Measurement, using a quoted prices in active markets (Level 1 inputs). For the year ended December 31, 2025, we incurred $ 1,614,717 in asset and strategic management fees under our strategic and asset management arrangements. These fees were calculated based on a tiered schedule applied to our average daily AUM, which include SUI, cash, and cash equivalents, but exclude assets related to our short-term lending business. NOTE 4 — DIGITAL ASSET LOAN RECEIVABLE On September 29, 2025, the Company entered into a digital currency loan agreement with Galaxy Digital LLC (“Galaxy”) pursuant to which the Company lent 961,550 SUI tokens. The loan carries a fee of 4.5 % per annum, paid in digital assets and is structured as an evergreen facility with the ability to terminate with a seven‑day notice period at the election of the Company. The loan fee are payable in the same digital assets as loaned under the loan agreement. Under the terms of the loan agreement, Galaxy shall make the repayment in the same digital asset as loaned or a cash payment in U.S. Dollars equal to the then-current fair value of such assets. On October 7, 2025, the Company entered into a separate digital currency loan agreement with BlueFin Labs Inc. (“BlueFin”) under which the Company lent 2,000,000 SUI tokens to BlueFin. In consideration, the Company is entitled to receive a fee equal to 5.0 % of all revenues generated by BlueFin’s decentralized exchange, paid in SUI tokens. The loan fees are payable in the same digital assets as loaned under the loan agreement. This agreement has an initial term of three years and will automatically renew for successive three‑year periods unless terminated in accordance with its terms. Pursuant to the loan agreement, BlueFin is obligated to return the loaned digital assets in kind at maturity or upon earlier termination. Neither of the above mentioned arrangements contains a collateral requirement. December 31, 2025 Digital asset loan receivable — current $ 1,354,089 Digital asset loan receivable — non current 2,805,600 Less: provision for credit loss ( 548,144 ) Total Digital asset loan receivable (net) $ 3,611,545 F-15 Table of Contents Digital asset loan receivables activity for the year ended December 31, 2025, is as follows. SUI Number of Tokens Balance Balance as of January 1, 2025 - fair value basis — $ — Origination of digital intangible asset loans receivable 2,961,550 8,076,571 Digital intangible asset loans interest receivable 3,726 5,589 Allowance for credit loss — ( 548,144 ) Fair value adjustment — ( 3,922,471 ) Balance as of December 31, 2025 - fair value basis 2,965,276 $ 3,611,545 Balance as of December 31, 2025- cost basis $ 8,076,571 Digital asset loan receivables are measured at fair value on a recurring basis in accordance with ASC 820, Fair Value Measurement, using a quoted prices in active markets (Level 1 inputs). The Company did not have any digital asset loan receivable outstanding as of December 31, 2024. NOTE 5 — PORTFOLIO INVESTMENTS As discussed in "Note 1 — Organization" , the Company ceased to qualify as an investment company during the quarter ended September 30, 2025 and therefore discontinued the application of ASC 946 on a prospective basis. Accordingly, the portfolio investment presentation by major asset class, which is required only for entities applying ASC 946, is not applicable for the year ended December 31, 2025 and is presented only for the year ended December 31, 2024. The following table shows the composition of our portfolio investment by major class, at amortized cost and fair value, as of December 31, 2024 (together with the corresponding percentage of total portfolio investments): As of December 31, 2024 Portfolio Investments at Amortized Cost Percentage of Amortized Cost Portfolio Investments at Fair Value Percentage of Fair Value Short-term non-banking loans $ 13,000,000 94.8 % $ 13,006,231 96.7 % Common stock 707,089 5.1 447,330 3.3 Other equity 10,000 0.1 — — Total $ 13,717,089 100.0 % $ 13,453,561 100.0 % F-16 Table of Contents The following table shows the composition of our investment portfolio by industry grouping, based on fair value as of December 31, 2024: As of December 31, 2024 Portfolio Investments at Fair Value Percentage of Fair Value Business services $ 9,985,925 74.2 % Consumer 508,774 3.8 Financial 442,864 3.3 Real estate 2,515,998 18.7 Total $ 13,453,561 100.0 % NOTE 6 — FAIR VALUE OF PORTFOLIO INVESTMENTS The following table presents the fair value measurements of our portfolio investments by major class, as of December 31, 2025, according to the fair value hierarchy: As of December 31, 2025 Level 1 Level 2 Level 3 Total Short-term non-banking loans $ — $ — $ 3,413,975 $ 3,413,975 Commercial business loans — — 10,244,122 10,244,122 Common stock 955,747 — — 955,747 Other equity — — — — Total $ 955,747 $ — $ 13,658,097 $ 14,613,844 F-17 Table of Contents The following table presents the fair value measurements of our portfolio investments by major class, as of December 31, 2024, according to the fair value hierarchy: As of December 31, 2024 Level 1 Level 2 Level 3 Total Short-term non-banking loans $ — $ — $ 13,006,231 $ 13,006,231 Common stock 447,330 — — 447,330 Other equity — — — — Total $ 447,330 $ — $ 13,006,231 $ 13,453,561 The following table presents a reconciliation of the beginning and ending fair value balances for our Level 3 portfolio investment assets for the year ended December 31, 2025: Balance Balance as of January 1, 2025 $ 13,006,231 Net change in unrealized loss ( 2,748,134 ) Purchases 7,900,100 Sales and redemptions ( 4,500,100 ) Balance as of December 31, 2025 $ 13,658,097 Of the total net change in unrealized loss presented in the reconciliation, $ 2,748,773 relates to Level 3 portfolio investment still held as of December 31, 2025. The following table presents a reconciliation of the beginning and ending fair value balances for our Level 3 portfolio investment assets for the year ended December 31, 2024: For the year ended December 31, 2024 Short-Term Non-banking Loans Preferred Stock Common Stock Other Equity Balance as of January 1, 2024 $ 16,961,766 $ 265,000 $ — $ 10,000 Net change in unrealized loss 401,966 785,000 ( 150,000 ) ( 10,000 ) Purchases and other adjustments to cost 4,623,437 — — — Sales and redemptions ( 8,720,000 ) — — Realized gain (loss) ( 100,000 ) ( 900,000 ) — — Conversion from preferred to Common Stock — ( 150,000 ) 150,000 — Transfers between level 3 and level 1 ( 160,938 ) — — — Balance as of December 31, 2024 $ 13,006,231 $ — $ — $ — The net change in unrealized depreciation for the year ended December 31, 2024, attributable to Level 3 portfolio investments still held as of December 31, 2024 is $ 83,496 . F-18 Table of Contents The following table lists our Level 3 investments held as of December 31, 2025, and the unobservable inputs used to determine their valuation: Security Type 12/31/25 FMV Valuation Technique Unobservable Inputs Range Short-Term Non-banking Loans $ 3,413,975 discounted cash flow determining private company interest rate based on changes in market rates of instruments with comparable creditworthiness, including assessment related to individual note creditworthiness 18 - 24 % Commercial Business Loans 10,244,122 discounted cash flow determining private company interest rate based on changes in market rates of instruments with comparable creditworthiness 18 - 24 % Other Equity — last secured funding known by company economic changes since last funding $ 13,658,097 The following table lists our Level 3 investments held as of December 31, 2024, and the unobservable inputs used to determine their valuation: Security Type 12/31/24 FMV Valuation Technique Unobservable Inputs Range Short-Term Non-banking Loans $ 13,006,231 discounted cash flow determining private company interest rate based on changes in market rates of instruments with comparable creditworthiness 15 - 24 % Other Equity — last secured funding known by company $ 13,006,231 There were no transfers between levels during the years ended December 31, 2025. There was one transfer between levels during 2024, which resulted from a loan that was converted into equity securities of a publicly traded entity. Upon conversion, the valuation inputs became observable, and the investment was transferred from Level 3 to Level 1 within the fair value hierarchy. NOTE 7 — SHAREHOLDERS’ EQUITY Private Placement On July 31, 2025, the Company completed the Private Placement of 75,881,625 shares of Common Stock at an offering price of $5.42 per-share, and Pre-Funded Warrants to purchase up to 7,144,205 shares of Common Stock at an offering price of $5.4199 per Pre-Funded Warrant, exercisable at a per-share price of $0.0001 . On July 31, 2025, the Company consummated the offer and sale of its securities pursuant to the Securities Purchase Agreement, dated as of July 27, 2025, by and among the Company and the investors identified on the signature pages thereto. The transaction was settled through a combination of cash, cash equivalent, and digital assets, resulting in cash and cash equivalents proceeds of $ 258,998,851 , and the receipt of approximately $ 191,001,099 million in SUI tokens and USDT coins contributed in-kind by certain investors as part of their investment consideration. The Company issued warrants to management and a director in conjunction with the Private Placement. See “ Note 8 — Share-Based Compensation ” for further details. The Company also issued warrants to the Sui Foundation (the “Foundation Investor Warrants”), to purchase 3,113,468 shares of Common Stock as follows: (i) 1,245,387 shares of Common Stock at an exercise price of $5.42 per-share; (ii) 1,245,387 shares of Common Stock at an exercise price of $5.962 per-share; (iii) 415,129 shares of Common Stock at an exercise price of $6.504 per-share; and (iv) 207,565 shares of Common Stock at an exercise price of $7.046 per-share. The Foundation Investor Warrants will vest over a 24-month period starting six months from the issue date in four equal installments (being 25% every six months) . F-19 Table of Contents The Company also issued warrants to certain investors involved in the Private Placement (the “Pre-Funded Warrants”) to purchase 7,144,205 shares of Common Stock at an exercise price of $0.0001 per-share with a purchase price of $5.4199 for one Pre-Funded Warran t. The Pre-Funded Warrants are exercisable immediately and may be exercised at any time until all of the Pre-Funded Warrants issued in the Private Placement are exercised in full. The Pre-Funded Warrants included provisions that restrict the holder from exercising any portion of the warrants to the extent that, following such exercise, the holder and its affiliates would beneficially own more than 4.99% of the Company’s outstanding Common Stock. At the holder’s election this threshold may be increased to 9.99%. Additionally, upon providing at least 61 days’ prior written notice to the Company, the holder may further increase the beneficial ownership limitation up to 19.99% of the Company’s outstanding Common Stock immediately following the exercise. The Pre-Funded Warrants and the Foundation Investor Warrants are classified in equity. Net proceeds received in the Private Placement were allocated to the Common Stock, the Pre-Funded Warrants, and the Foundation Investor Warrants on a relative fair value basis. As of December 31, 2025, a total of 3,050,523 shares of our Common Stock has been issued on exercise of Pre-Funded Warrants and Pre-Funded Warrants exercisable for a total of 4,093,682 shares of our Common Stock remain outstanding. However, all Pre-Funded Warrants are considered outstanding shares for calculation of earnings per share. See “Note 10 — Segment” for further details. Placement Agent Agreement On July 27, 2025, in connection with the Private Placement, the Company entered into a Placement Agent Agreement with A.G.P., (the “Placement Agent Agreement”) under which A.G.P. was appointed as the exclusive placement agent for the transaction. Pursuant to the terms of the agreement, the Company paid A.G.P. a cash fee of $ 18,000,000 . Additionally, the Company issued warrants to A.G.P. (the “Placement Agent Warrants”), to purchase up to 3,113,469 shares of Common Stock, representing 3.75% of the securities sold in the Private Placement. These Placement Agent Warrants will become exercisable six months after the issuance date of July 31, 2025, and remain valid for five years from that date, with an exercise price of $ 5.962 per share. The Company also reimbursed A.G.P. for accountable legal expenses totaling $ 200,000 and non-accountable expenses of up to $ 25,000 related to the Private Placement. All cash fees and the fair value of the Placement Agent Warrants are recorded as equity issuance cost, net against the proceeds from the Private Placement. Placement Agent Warrants are accounted for as share-based compensation awards. See “ Note 8 — Share-Based Compensation ” for further details. Common Stock Purchase Agreement On August 1, 2025, the Company entered into a Common Stock Purchase Agreement (the “Common Stock Purchase Agreement”) with A.G.P., granting the Company the right, but not the obligation, to direct A.G.P. to purchase up to the lesser of $500.0 million in aggregate gross proceeds or a number of shares not to exceed 19.99% of the Company’s outstanding Common Stock as of August 1, 2025 , unless shareholder approval is obtained to exceed such threshold. The Company also entered into a Registration Rights Agreement with A.G.P. on the same date, pursuant to which it agreed to file a resale registration statement with the SEC covering the shares issuable under the Common Stock Purchase Agreement (the “Registration Rights Agreement”). As of December 31, 2025, no shares have been issued under the Common Stock Purchase Agreement. Sales of Common Stock under the Purchase Agreement, if any, will be made at a per-share purchase price equal to no less than 95% of the volume-weighted average price over a specified period, as set forth in the Common Stock Purchase Agreement. Proceeds from any such sales will be used as described in the related registration statement and any applicable prospectus supplements. Stock Repurchase Program During the year ended December 31, 2025, the Company repurchased a total of 8,718,562 shares of Common Stock for $18,931,518 under its stock repurchase programs. The Company completed its original $2.0 million stock repurchase program and utilizing $16.9 million of a new $50.0 million stock repurchase program approved by the Board on September 15, 2025 . As of December 31, 2025, $ 33.1 million remained available for future repurchase. F-20 Table of Contents 2022 Public Offering In connection with a public offering completed in 2022, the Company issued a five-year warrant to the underwriter to purchase up to 75,000 shares of Common Stock at an exercise price of $5.00 per-share. The warrant became exercisable 180 days after issuance and expires on August 8, 2027 . During the year ended December 31, 2025, the underwriter exercised the warrant for 71,531 shares of Common Stock for an aggregate exercise price of $ 357,655 . As of December 31, 2025, 3,469 shares remained outstanding under the warrant. This warrant is equity-classified. NOTE 8 — SHARE-BASED COMPENSATION Options The Company’s 2022 Stock Incentive Plan (the “2022 Plan”) authorized the issuance of incentives relating to 900,000 shares of Common Stock. The 2022 Plan was amended by the Board on August 14, 2023, and a registration statement on Form S-8 respecting the 2022 Plan was filed with the SEC on August 23, 2023. As of December 31, 2025, incentives relating to the issuance of 870,000 shares of Common Stock have been issued under the 2022 Plan, leaving 30,000 shares available for issuance. These options were fully vested upon issuance and have a contractual term of 10 years. The following table summarizes the activity for all stock options outstanding for the years ended December 31, 2025: Number of Options Weighted Average Exercise Price Weighted Average Remaining Life (Years) Aggregate Intrinsic Value Options outstanding at beginning of year 670,000 $ 2.11 Granted — $ - Exercised ( 132,500 ) $ 2.05 Forfeited — $ - Options outstanding at December 31, 2025 537,500 $ 2.12 6.92 — Options exercisable at December 31, 2025: 537,500 $ 2.12 6.92 — As of December 31, 2025, and 2024, all of the options were fully vested and there is no unrecognized compensation expense associated with the options. During the year ended December 31, 2025, and 2024, the Company did not grant any new options. As such, no compensation expense is recognized for the year ended December 31, 2025, and 2024. Aggregate intrinsic value of the options exercised for the year ended December 31, 2025 and 2024 was $ 354,175 and $ 0 , respectively. Warrants In connection with the Private Placement (see “Note 7 — Shareholders’ Equity”) in the third quarter of 2025, the Company issued the following warrants to purchase its Common Stock in exchange for services: (i) Warrants to Karatage Opportunities (“Karatage”), to purchase 3,113,469 shares of Common Stock (the “Lead Investor Warrants”) that vest over a 24-month period, starting six months from the issue date, in four equal installments (being 25% every six months) subject to Karatage providing services under a strategic advisor agreement. F-21 Table of Contents (ii) Warrants to certain members of the management of the Company to purchase 1,245,388 shares of Common Stock (the “Management Warrants”) that will vest over a 24-month period, starting six months from the issue date, in four equal installments (being 25% every six months) subject to the relevant holders still being employed by the Company. (iii) Warrants to certain advisors of the Company to purchase 207,565 shares of Common Stock (the “Advisor Warrants”) that are fully vested at issuance. (iv) Warrants to purchase up to 3,113,469 shares of Common Stock (the “Placement Agent Warrants”) to A.G.P in connection with their services under Placement Agent Agreement that are fully vested at issuance. (v) Warrants to purchase 207,565 shares of Common Stock (the “Director Warrant”) issued to a member of our Board that will vest over a 24-month period, starting six months from the issue date, in four equal installments (being 25% every six months) subject continued service. All the above warrants have a contractual term of five years. The following table summarizes the key terms of all warrants issued as compensation: Number of Warrants Exercise Price Exercisable as of Date Expiration Date Lead Investor Warrants Tranche 1 1,245,387 $ 5.42 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 2 1,245,387 $ 5.96 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 3 415,130 $ 6.50 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 4 207,565 $ 7.05 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Management Warrants Tranche 1 622,694 $ 5.42 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 2 415,129 $ 6.50 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 3 207,565 $ 7.05 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Advisor Warrants 207,565 $ 5.96 On or after January 31, 2026 July 27, 2030 Placement Agent Warrants 3,113,469 $ 5.96 February 28, 2026 July 27, 2030 Director Warrants Tranche 1 83,026 $ 5.42 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 2 41,513 $ 5.96 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 3 41,513 $ 6.50 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 Tranche 4 41,513 $ 7.05 25% exercisable as of January 27, 2026, and each 25% every six months thereafter July 27, 2030 7,887,456 All of the above warrants meet equity classification criteria and will be recognized based on the grant date fair value. For the year ended December 31, 2025, the Company recognized a total Stock-based Compensation expense of $ 4,431,781 . Additionally, the Company recorded the fair value of the Placement Agent Warrants of $ 10,928,276 as equity issuance cost, net of the cash proceeds from the issuance of Common Stock in the Private Placement. As of December 31, 2025, there was $ 11,428,129 of unrecognized compensation cost related to warrants to be recognized over a weighted average period of 1.45 years. The following table summarizes warrant activity for the period ended December 31, 2025: Number of Weighted Shares Average Issuable Weighted Remaining Upon Average Contractual Aggregate Exercise of Exercise Life Intrinsic Warrants Price (years) Value Outstanding on December 31, 2024 - - Issued 7,887,456 $ 5.95 - Exercised - $ - Expired - $ - Outstanding on December 31, 2025 7,887,456 $ 5.95 4.57 - Exercisable on December 31, 2025 - The weighted average issue date fair value per share for the warrants issued in 2025 is $ 3.40 . The Company used the Black-Scholes option pricing model for the warrants that were issued with a strike price at or lower than the Common Stock fair value and Monte-Carlo Simulation model for the warrants that were issued with strike price above the fair value of the Common Stock. The following table summarizes the assumptions used to calculate the issue date fair value of the warrants issued on July 27, 2025: Inputs Stock Price $ 5.42 Volatility 80.00 % Dividend Yield 0.00 % Expected term (in years) 3.1 – 5 Risk-free rate 3.91 % F-22 Table of Contents NOTE 9 — Earnings Per Share Basic earnings (loss) per share are computed by dividing net income (loss) by the weighted average number of Common Shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of dilutive Common Shares outstanding during the period. The Company’s potential dilutive Common Shares include stock options and warrants that are in the money. The Company uses the treasury stock method to compute the dilutive shares related to in-the-money stock options and warrants, to be included in the dilutive earning per share, when the effect is not anti-dilutive. A reconciliation of the numerator and denominator used in the calculation of basic and diluted earnings (loss) per share is set forth below: December 31, 2025 December 31, 2024 Basic earnings per share: Numerator: Net income/(loss) $ ( 264,953,075 ) $ 1,167,726 Net income /(loss)available to common stockholders ( 264,953,075 ) 1,167,726 Denominator: Weighted average common shares outstanding - basic 40,212,397 6,385,255 Effect of dilutive shares - 107,020 Weighted-average number of common shares outstanding - diluted 40,212,397 6,492,275 Basic earnings (loss) per share $ ( 6.59 ) $ 0.18 Diluted earnings (loss) per share: $ ( 6.59 ) $ 0.18 For the year ended December 31, 2025, the following instruments were excluded from the computation of the dilutive earnings per share because their effect would be anti-dilutive: Outstanding as of December 31, 2025 Stock options 537,500 Warrants 11,004,394 For the year ended December 31, 2025, 4,093,682 shares of Pre-Funded Warrant were included in the denominator of both basic and diluted EPS calculation because Pre-Funded Warrants are exercisable for little cash consideration. NOTE 10 — SEGMENT The Company has one reportable operating segment, which is a digital asset platform focused on maximizing SUI per share value and advancing the Sui ecosystem. The legacy financing solutions business is not considered a separate reportable segment, as the Company’s segment reporting has been to reflect the Company’s current strategic and operational decision-making. The Company’s chief operating decision makers (“CODM”) are the Company’s Chairman and the Chief Investment Officer, who, together, manage the Company’s operations as one operating segment for the purpose of evaluating financial performance and allocating resources. The accounting policies of the Company’s segment are the same as those described in the summary of significant accounting policies. The CODMs use revenue, unrealized gain/loss on SUI and operating income to assess performance and allocate resources. The significant segment expense categories regularly provided to the CODMs are the same as those included on the condensed statements of operations. The measure of segment assets is total assets as reported on the balance sheets. F-23 Table of Contents NOTE 11 — RELATED PARTY TRANSACTIONS Karatage is a privately held entity co‑founded by the Company’s Chairman of the Board and the Company’s Chief Investment Officer. Accordingly, Karatage is considered a Related Party under ASC 850, Related Party Disclosures, due to the ownership interests and leadership roles held by members of the Company’s key management personnel. During the year ended December 31, 2025, the Company engaged Karatage to serve as a strategic advisor to support the Company’s business initiatives and long‑term strategic planning pursuant to a strategic advisor agreement. Under this arrangement, the Company incurred advisory fees of $ 639,694 for the year ended December 31, 2025, which is included as part of professional fees in the statements of operations. As of December 31, 2025, $ 43,471 remained unpaid and is included in accounts payable and accrued liabilities on the balance sheet. In addition to the advisory arrangement described above, the Company also entered into other transactions with Karatage in connection with the PIPE transaction and equity‑based compensation arrangements. These transactions are discussed further in “ Note 7 — Shareholders’ Equity ” and “ Note 8 — Share-Based Compensation ” to the financial statements. We held a promissory note with two shareholders in the principal amount of $ 250,000 . The promissory note bore interest payable monthly at the rate of 10 % per annum. The promissory note was secured by the debtors’ pledge to us of 277,778 shares of Common Stock. The note was paid in full including all accrued interest on September 26, 2024. NOTE 12 — RETIREMENT SAVINGS PLANS Our full-time employees are eligible to participate in a qualified defined contribution 401(k) plan whereby they may elect to have a specified portion of their salary contributed to the plan. We will make a safe harbor match equal to 100% of their elective deferrals up to a maximum of 5% of eligible earnings in addition to our option to make discretionary contributions to the plan. We made aggregate contributions to the plan totaling $ 26,320 and $ 20,000 for the years ended 2025 and 2024, respectively. NOTE 13 — INCOME TAXES The provision for/(benefit from) income taxes consisted of the following for the year ended December 31, 2025 and 2024: December 31, 2025 2024 Current taxes Federal $ ( 18,245 ) $ 325,172 State ( 8,315 ) 113,278 Deferred taxes Federal 579,189 ( 13,000 ) State 190,811 — Provision for income taxes $ 743,440 $ 425,450 The table below provides the updated requirements of ASU 2023-09 for 2025. See “ Note 2 — Summary of Significant Accounting Policies ” for additional details on the adoption of ASU 2023-09. F-24 Table of Contents The effective income tax rate for the year ended December 31, 2025, differs from the statutory federal income tax rate as follows: Year Ended December 31, 2025 $ % Provision for income taxes at U.S. federal statutory rate $ ( 55,484,023 ) 21.00 % State and local income taxes, net of federal benefit (primarily attributable to Minnesota) 5,074,006 ( 1.92 ) Changes in valuation allowance 51,273,238 ( 19.41 ) Non-taxable or non-deductible items: ( 73,937 ) 0.03 Other reconciling items ( 50,844 ) 0.02 Total tax provision and effective tax rate $ 743,440 ( 0.28 )% The Company’s effective tax rate of ( 0.28 %) for the year ended December 31, 2025, is due primarily to state taxes and the application of a valuation allowance against the Company’s deferred tax assets. As previously disclosed for the tax year ended December 31, 2024, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the statutory federal income tax rate as follows: 2024 Rate reconciliation: Tax expense at U.S. statutory rate $ 423,931 Change in deferred tax rate ( 91 ) Prior year over accrual 4,923 Provision-to-return reconciliation ( 1,417 ) Other ( 1,896 ) Income tax provision $ 425,450 As of December 31, 2025, and 2024, we had a deferred tax asset of $ 0 and $ 770,000 , respectively. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and liabilities as of December 31, 2025, and 2024 were as follows: December 31, 2025 2024 Deferred tax assets Unrealized loss on marketable securities $ - $ 69,887 Unrealized loss on digital assets 73,018,001 - Current expected credit loss 153,133 - Capital loss carryforward 367,387 345,256 Net operating losses 142,835 - Depreciation 1,332 1,265 R&D and foreign credits 40,820 40,820 Stock options 1,470,325 274,803 Accrued bonuses - 39,780 Gross deferred tax assets 75,193,833 771,811 Deferred tax liabilities Prepaid insurance ( 429,227 ) - Other - ( 1,811 ) Total deferred tax liabilities ( 429,227 ) ( 1,811 ) Net deferred tax asset 74,764,606 770,000 Less valuation allowance ( 74,764,606 ) - Total net deferred tax asset $ - $ 770,000 F-25 Table of Contents Valuation allowances are established when the Company has concluded that it is more likely than not that such deferred tax assets are not realizable. The Company's ability to realize its remaining deferred tax assets as of December 31, 2025 is primarily dependent upon generating sufficient taxable income of the proper character in future years. Management has concluded that there is not sufficient positive evidence to support the expected realization of these deferred tax assets primarily due to the fact that unrealized investment on digital assets as of December 31, 2025 is a source of future taxable benefit that will not be offset by future taxable income on minimal deferred tax liabilities. As part of the assessment of the amount of the valuation allowance, the Company considered that it has the ability and intent to execute tax planning strategies if necessary, including selling digital assets with a built-in-gain. After consideration of all available evidence, the Company has concluded that, as of December 31, 2025, it is more likely than not that its deferred tax assets will not be realized. If the market value of digital assets changes in future periods, the Company will assess other sources of forecasted taxable income of proper character, which could result in the release of the valuation allowance. NOTE 14 — SUBSEQUENT EVENTS The Company evaluated subsequent events through the date these financial statements were issued. The following subsequent events occurred after December 31, 2025, and did not require adjustment to the accompanying financial statements: On January 5, 2026, the Company’s Chief Financial Officer, Joseph A. Geraci, II, resigned from the Board while continuing in his role as Chief Financial Officer and Board Observer. On the same date, the Board appointed Mr. Brian Quintenz (“Mr. Quintenz”) as a director and member of the Audit Committee. He will receive an annual director fee of $ 250,000 (paid quarterly) and warrants to purchase 207,565 shares of Common Stock at exercise prices ranging from $ 5.420 to $ 7.046 , vesting over 24 months in equal semiannual installments and exercisable for five years . With Mr. Quintenz’s appointment, the Company is in compliance with Nasdaq Listing Rules related to board independence and Audit Committee composition. F-26 Table of Contents ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.