Mawson Infrastructure Group Inc.

NOTE 1 – GENERAL

Nature of operations

Mawson Infrastructure Group Inc. (“Mawson,” the “Company,” “we,” “us,” and “our”) is a technology company focused on digital infrastructure platforms, headquartered in the United States of America.

On March 9, 2021, the Company acquired the shares of Cosmos Capital Limited (now known as Mawson Infrastructure Group Pty Ltd and referred to herein as “Mawson PL”) in a stock for stock exchange. This transaction has been accounted for as a reverse asset acquisition. Shares of the Company’s common stock, par value $0.001 per share (“Common Stock”) have been listed on The Nasdaq Capital Market since September 29, 2021.

On November 19, 2025, the Company filed a Certificate of Amendment (the “Charter Amendment”) to the Company’s Certificate of Incorporation (as amended through immediately prior to the Effective Time (as defined below), the “Certificate of Incorporation”) to effect a 1-for-20 reverse stock split (the “Reverse Stock Split”) of the outstanding shares of the Common Stock. Pursuant to the Charter Amendment, the Reverse Stock Split became effective as of 5:00 p.m. Eastern time on November 20, 2025 (the “Effective Time”).

The Reverse Stock Split was primarily intended to increase the per share market price of the Common Stock in order to meet the $1.00 per share minimum bid price required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2). The Common Stock began trading on a Reverse Stock Split adjusted basis on The Nasdaq Capital Market at market open on November 21, 2025 under the existing symbol “MIGI” and the new CUSIP number 57778N406.

The impacts of the Reverse Stock Split were applied retroactively for all periods presented in accordance with applicable guidance, less the number of rounded whole shares issued for fractional shares. Therefore, prior period amounts are different than those previously reported. There were no changes to the total number of authorized shares of the Company’s capital stock or their respective par values per share as a result of this change.

The Company designs, builds and operates next-generation digital infrastructure platforms for enterprise customers and for its own purposes. The Company provides services spanning artificial intelligence (“AI”), high-performance computing (“HPC”), digital assets including Bitcoin mining, and other intensive compute applications. The Company delivers both self-mining operations and colocation services to enterprise customers with a vertically integrated infrastructure model built for scalability and efficiency. The Company also has an energy management business, which utilizes software and analysis, to generate revenue when the Company participates in energy management programs related to the real-time needs of the power grid.

The Company has a strategy to prioritize the usage of carbon-free energy sources, including nuclear energy, to power its digital infrastructure platforms and computational machines to support the rapid growth of the digital economy in an environmentally sustainable way.

The Company manages and operates digital infrastructure platforms and data centers delivering a total current capacity of approximately 129 megawatts (“MW”) with its current operational sites with an additional 24 MW of future capacity that is under development, all strategically located in locations served by the PJM Energy Market in the United States. The PJM Energy Market is the largest wholesale power market in North America.

The accompanying consolidated financial statements, including the results of Cosmos Trading Pty Ltd, Cosmos Infrastructure LLC (“Cosmos”), Cosmos Manager LLC, MIG No.1 Pty Ltd (“MIG No. 1”), MIG No.1 LLC, Mawson AU Pty Ltd (“Mawson AU”), Mawson Services Pty Ltd (“Mawson SPL”), Luna Squares LLC (“Luna Squares”), Mawson Bellefonte LLC, Luna Squares Repairs LLC, Luna Squares Property LLC (“Luna Property”), Mawson Midland LLC, Mawson Hosting LLC (“Mawson Hosting”), Mawson Ohio LLC, Mawson Mining LLC and Mawson Capital LLC (collectively referred to as the “Group”), have been prepared by the Company pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) and in accordance with generally accepted accounting principles in the United States (“GAAP”).

Going Concern

The accompanying consolidated financial statements have been prepared assuming the Company will continue on a going concern basis and in accordance with GAAP. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business.

Pursuant to the requirements of the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) Topic 205-40,Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date these financial statements are issued. This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.

For the year ended December 31, 2025, the Company incurred a loss after tax of $23.7 million, and as of December 31, 2025, had negative working capital of $31.3 million, stockholders’ deficit of $3.1 million and an accumulated deficit of $252.5 million. The Company’s cash position as of December 31, 2025, was $13.3 million.

The Company’s revenue is dependent on a number of external factors, including commercial terms, payments from customers, payments from partners, counterparty risks, and market conditions, including those related to digital assets, AI, HPC and other markets. These factors are outside the Company’s direct control, and the Company may not be able to practically mitigate their impact. The Company cannot predict with any certainty whether these trends will reverse or persist. In addition, the Company’s equipment and infrastructure will require replacement over time as they come to the end of their useful lives to ensure that the Company can continue to operate competitively and efficiently.

The Company has ongoing litigation related to the Marshall Loan, W Capital Loan, Celsius Promissory Note and Celsius Colocation Agreement (each defined below). See Note 10 – Commitments and Contingencies.

Going Concern (Cont.)

The Company has evaluated the above conditions and concluded that these conditions raise substantial doubt regarding our ability to continue as a going concern for a period of at least one year from the date of issuance of these consolidated financial statements.

To mitigate these conditions, the Company has explored various avenues to enhance liquidity, fund the Company’s expenditures, and meet debt servicing requirements. These strategies include, among others:

Going Concern (Cont.)

On October 16, 2025, the Company entered into an At the Market Offering Agreement (the “Sales Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”) to sell shares (the “Shares”) of our Common Stock having an aggregate sales price of up to $9.6 million, from time to time, through an “at-the-market” offering program (the “ATM”) under which Wainwright will act as sales agent. On December 11, 2025, the Company filed a prospectus supplement (the “Prospectus Supplement”) with the SEC to increase the capacity of the ATM by $40 million.

As of December 31, 2025, the Company has sold 2,468,729 shares of Common Stock under the Sales Agreement at an average price of approximately $6.12 per share, which has resulted in cash proceeds to the Company of $14.6 million, net of issuance costs. An additional 53,696 shares were issued due to fractional share rounding related to the Reverse Stock Split. The ATM shares and the fractional shares total the 2,522,425 shares issued during the year.

Although the Company may have access to capital, debt, and/or other sources of funding, these may require additional time and cost, may impose operational restrictions and other covenants on the Company, may not be available on attractive terms, and may not be available at all. If the Company raises additional capital or debt, this could cause additional dilution to the Company’s stockholders. The terms of any future capital raise or debt issuance and the costs of any financing are uncertain and may be unfavorable to the Company. Should the Company be unable to source sufficient funding, the Company may not be able to realize assets at their recognized values and fulfill its liabilities in the normal course of business at the amounts stated in these consolidated financial statements.

The Company obtains advice from outside resources; however, it is important to note that strategic and other initiatives may not lead to any transaction or other outcome.

These consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities and other commitments in the normal course of business. They do not include any adjustments relating to the recoverability and carrying amounts of assets and the amounts of liabilities should the Company be unable to continue as a going concern and meet its obligations and debts as and when they fall due.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

Use of estimates in preparation of Financial Statements

The preparation of the financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated financial statements, and the reported amounts of income and expenses during the reporting periods. Actual results could differ from those estimates. The Company has considered the following to be significant estimates made by management, including but not limited to, going concern assumptions, estimating the useful lives of fixed assets, realization of long-lived assets, unrealized tax positions, and valuing the derivative asset classified under Level 3 fair value hierarchy.

Principles of consolidation

The accompanying consolidated financial statements of the Company include the accounts of the Company and its wholly or majority owned and controlled subsidiaries. Intercompany investments, balances and transactions have been eliminated in consolidation. Non–controlling interests represent the minority equity investment in the Company’s subsidiaries, plus the minority investors’ share of the net operating results and other components of equity relating to the non–controlling interest.

Any change in the Company’s ownership interest in a consolidated subsidiary, through additional equity issuances by the consolidated subsidiary or from the Company acquiring the shares from existing stockholders, in which the Company maintains control is recognized as an equity transaction, with appropriate adjustments to both the Company’s additional paid-in capital and the corresponding non-controlling interest.

Revenue recognition

The Company recognizes revenue under ASC 606,Revenue from Contracts with Customers. The core principle of ASC 606 is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. Five steps are required to be followed in evaluating revenue recognition: (i) identify the contract with the customer; (ii) identity the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue when or as the entity satisfies a performance obligation.

In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct), and the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract).

Digital colocation revenue

The Company charges colocation fees for the use of its facilities, and other related fees. In addition, digital colocation customers typically pay for energy used in connection with the customer colocation services agreement on a pass-through basis, which may be on a fixed or variable basis calculated on the portion of energy used by the customer on the site. The Company satisfies the performance obligation when the customer has the ability to direct the use and obtain substantially all of the remaining benefits of the good or service. Revenue is recognized over time as customers simultaneously receive and consume the benefits because another party would not need to substantially reperform the work completed by the Company were that other party to fulfill the remaining performance obligation to the customer. Revenue is recognized upon confirmation of the Company’s power usage by the electricity provider and billed at the rates outlined in each customer contract on a monthly basis.

The customer contracts contain variable consideration to be allocated to and recognized in the period to which the consideration relates. Usually this is when it is invoiced, rather than obtaining an estimation of variable consideration at the beginning of the customer contracts.

Revenue recognition (Cont.)

Energy management revenue

The Company also has an energy management business to generate revenue when the Company adapts its power usage to the real-time needs of the power grid. Energy management revenue consists of revenue for curtailing power, and through a power pricing arrangement.

Revenue for curtailing power is recognized over the period that the services are being provided. The Company estimates the amount of curtailable power and the expected payment for that curtailment and recognizes revenue based on the proportion of the service that has been provided. In this arrangement, the Company is considered the principal and revenue is recognized on a gross basis.

Revenue through the Company’s power pricing arrangement is recognized over the period that the services are being provided. The Company estimates the amount of energy available for sale and the expected payment for that energy, and recognizes revenue based on the proportion of the service that has been provided. In this arrangement, the Company is considered the principal and revenue is recognized on a gross basis.

Digital assets mining revenue

The Company has a contract with mining pools and has undertaken the performance obligation of providing computing power in exchange for non-cash consideration in the form of digital assets. The provision of computing power is the only performance obligation in the Company’s contract with its pool operators. Where the consideration received is variable (for example, due to payment only being made upon successful mining), it is recognized when it is highly probable that the variability is resolved, which is generally when the digital asset is received.

The Company measures the non-cash consideration received at the fair market value of the digital asset received. Management estimates fair value on a daily basis, as the quantity of digital assets received multiplied by the price quoted on the exchange that the Company uses to dispose of digital assets.

Cost of revenues

Cost of revenue consists primarily of expenses that are directly related to providing the Company’s service to its paying customers. These primarily consist of costs associated with operating our colocation facilities such as direct power costs, energy costs, freight costs and material costs related to digital asset mining.

Income taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance may be established to reduce the deferred tax asset to the level at which it is “more likely than not” that the tax asset or benefits will be realized. Realization of tax benefits of deductible temporary differences and operating loss carryforwards depends on having sufficient taxable income of an appropriate character within the carryback or carryforward periods.

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained upon review by the taxing authority. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

Functional currency

All subsidiaries of the Company have a functional currency of United States dollar (“USD”) with the exceptions of MIG No.1 Pty Ltd (on March 19, 2024, MIG No.1 Pty Ltd was placed into a court appointed liquidation and wind-up process), Mawson SPL (on April 29, 2024, Mawson SPL was placed into a Australian court appointed liquidation and wind-up process) and Mawson AU (on April 23, 2024, the Australian entity Mawson AU was placed into a Australian court appointed liquidation and wind-up process) and Cosmos Trading Pty Ltd whose functional currency is the Australian Dollar (“AUD”). Assets and liabilities of Australian entities are translated into USD at exchange rates in effect on the consolidated balance sheet dates. Revenue and expense accounts are translated using the monthly average exchange rates during the period. Translation of all the consolidated companies’ financial records into USD is required due to the reporting currency for these consolidated financial statements presented as USD and the functional currency of the parent company being that of USD. Translation adjustments are accumulated in other comprehensive income (loss). Gains or losses on foreign currency transactions and translation adjustments in highly inflationary economies are recorded as income in the period in which they are incurred.

Segment reporting

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision–making group in deciding how to allocate resources and in assessing performance. The Company’s CODM group is composed of the Interim Chief Executive Officer and Chief Financial Officer.

The Company operates asone energy management and digital asset mining segment and uses net income as a measure of profit or loss on a consolidated basis in making decisions regarding resource allocation and performance assessment. All income is generated from operations located in the United States. Additionally, the Company’s CODM regularly reviews the Company’s expenses on a consolidated basis. The financial metrics used by the CODM help make key operating decisions, such as determination of purchases and significant acquisitions and allocation of budget between cost of revenues, general and administrative, research and development expenses and net income. The CODM does not evaluate performance or allocate resources based on segment asset or liability information.

Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, cash held with digital asset exchanges, and other short-term and highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less.

Cryptocurrencies held for customers

Cryptocurrencies held for customers are included in current assets in the consolidated balance sheets.

The following table presents the Company’s cryptocurrency (Bitcoin) activities for the years ended December 31, 2025 and 2024:

Cryptocurrencies held for customers are measured at fair value.

The Company’s policy is to dispose of Bitcoin received from mining operations routinely, usually no more than a few days after receipt. At December 31, 2025, the Company continued to hold 10.3 Bitcoin due to an ongoing customer dispute. The Company recognized corresponding cryptocurrencies due to customer liability included in trade and other payables on the balance sheet.

Fair value of financial instruments

The Company accounts for financial instruments under ASC 820,Fair Value Measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in a principal or most advantageous market. ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:

Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 — observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived valuations whose significant inputs and significant value drivers are observable in active markets;

Level 3 — assets and liabilities whose significant value drivers are unobservable.

Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation. In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy. In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment.

Fair value of financial instruments (Cont.)

Level 1 Assets and Liabilities:

In accordance with Accounting Standards Update (“ASU”) 2023-08, cryptocurrency that was mined from colocation services and held in a digital asset account controlled by the Company is measured at fair value and recognized separately on the cryptocurrencies line of the balance sheet. Due to an ongoing customer dispute, the Company has recognized corresponding cryptocurrencies due to customer liability included in trade and other payables on the balance sheet. The estimated fair value of the cryptocurrency and alleged liability is classified as Level 1 of the fair value hierarchy and is based on the quantity of cryptocurrency held in the digital asset account multiplied by the price quoted on the exchange the Company uses to dispose of digital assets on December 31, 2025.

Level 3 Assets:

In June 2022, the Company entered into a power supply agreement (“PSA”) with Energy Harbor LLC (“Energy”), the energy supplier to the Company’s Midland, Pennsylvania facility, to provide the delivery of a fixed portion of the total amount of electricity for a fixed price through December 2026. If the Midland, Pennsylvania facility uses more electricity than contracted, the cost of the excess is incurred at a new price quoted by Energy.

While the Company participates in energy management programs at its Midland, Pennsylvania facility, the Company does not consider such actions as trading activities. That is, the Company does not engage in speculation in the power market as part of its ordinary activities. Because the sale of any electricity under a curtailment program allows for net settlement, the Company has determined the PSA meets the definition of a derivative under ASC 815,Derivatives and Hedging. However, because the Company has the ability to sell the power back to the grid rather than take physical delivery, physical delivery is not probable through the entirety of the contract and therefore, the Company does not believe the normal purchases and normal sales scope exception applies to the PSA. Accordingly, the PSA (the non-hedging derivative contract) is recorded at estimated fair value each reporting period with the change in the fair value recorded in “change in fair value of derivative asset” in the consolidated statements of operations.

The PSA was classified as a derivative asset beginning in the quarter ended September 30, 2022, and measured at fair value on the date of the PSA, with changes in fair value recognized in the accompanying consolidated statements of operations. The estimated fair value of the Company’s derivative asset is classified in Level 3 of the fair value hierarchy due to the significant unobservable inputs utilized in the valuation. Specifically, the Company’s discounted cash flow estimation models contain quoted commodity exchange spot and forward prices and are adjusted for basis spreads for load zone-to-hub differentials through the term of the PSA, which expires in December 2026. In addition, the Company adopted a discount rate of approximately 20% above the terminal value of the observable market inputs, but also includes unobservable inputs based on qualitative judgment related to company-specific risk factors. The terms of the PSA require pre-payment of collateral, calculated as forward cost based on the market cost rate of electricity versus the fixed price stated in the contract.

Equity method investments

Equity investments are accounted for under the equity method if we are able to exercise significant influence, but not control, over an investee. Our share of the losses as reported by the investees is classified as loss from equity investees method investments on our consolidated statements of operations. The investments are evaluated for impairment annually and when facts and circumstances indicate that the carrying value may not be recoverable. If a decline in fair value is determined to be other-than-temporary, an impairment charge is recorded in our consolidated statements of operations. The Company has had a 34.9% holding in Tasmania Data Infrastructure Pty Ltd. (TDI) through its subsidiary Mawson AU. During the year ended December 31, 2024, the investment was written off as part of the deconsolidation of Mawson AU (on April 23, 2024, the Australian entity Mawson AU was placed into an Australian court appointed liquidation and wind-up process).

Concentrations of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents. Cash and cash equivalents are invested in banks. If the counterparty completely failed to perform in accordance with the terms of the contract, the maximum amount of loss to the Company would be the balance. Management believes that the financial institutions that hold the Company’s investments are financially sound and, accordingly, minimal credit risk exists with respect to these investments. The Company has no off-balance-sheet concentration of credit risk such as foreign exchange contracts, option contracts or other foreign hedging arrangements.

Property, plant, and equipment

Property, plant and equipment (“PP&E”) are stated at cost, net of accumulated depreciation. All other repair and maintenance costs are charged to operating expenses as incurred. The present value of the expected cost for the decommissioning of an asset after its use is included in the cost of the respective asset if the recognition criteria for a provision are met. PP&E transferred from customers is initially measured at the fair value at the date on which control is obtained.

PP&E are depreciated on a straight-line or declining balance basis based on the asset classification, over their useful lives to the economic entity commencing from the time the assets arrive at their destination where they are ready for use. Depreciation is calculated over the following estimated useful lives:

PP&E are derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset is included in the consolidated statement of operations.

The residual values, useful lives and methods of depreciation of PP&E are reviewed at each financial year end and adjusted prospectively, if appropriate.

The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such an asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

Stock based compensation

The Company follows ASC 718-10,Compensation-Stock Compensation. The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant-date fair value of the awards. The Company determines the grant date fair value of options using the Trinomial Lattice Method. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. These assumptions are the expected stock volatility, the risk–free interest rate, the expected life of the option, and the expected forfeiture rate. Expected volatility computes stock price volatility over expected terms based on its historical common stock trading prices. Risk–free interest rates are calculated based on the yield of a 3-year or 5-year United States Treasury constant maturity bond, depending on the agreement.

Leases

The Company accounts for its leases under ASC 842,Leases and determines if an arrangement is a lease at inception. Using ASC 842, leases are classified as operating or finance leases on the balance sheet as right of use (“ROU”) assets and lease liabilities within current liabilities and long-term liabilities on our consolidated balance sheets. ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The Company’s lease does not provide an implicit rate and therefore the Company measured the ROU asset and lease obligation based upon the present value of future minimum lease payments. The Company’s incremental borrowing rate is estimated based on a risk-free discount rate for the lease, determined using a period comparable with that of the lease term and in a similar economic environment. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise such options. The Company does not record leases on the consolidated balance sheets with a term of one year or less. The Company does not separate lease and non-lease components but rather account for each separate component as a single lease component for all underlying classes of assets. Where leases contain escalation clauses, rent abatements, or concessions, such as rent holidays and landlord or tenant incentives or allowances, the Company applies them in the determination of straight-line operating lease cost over the lease term.

Accounts receivable

The Company’s accounts receivable balance consists of amounts due from its digital colocation customers. The Company records accounts receivable at the invoiced amount less an allowance for any potentially uncollectable accounts under the current expected credit loss impairment model and presents the net amount of the receivable expected to be collected. The Company performs ongoing credit evaluation of its customers and management closely monitors outstanding receivables based on factors surrounding the credit risk of specific customers, historical trends, and other information.

Accounts receivable (Cont.)

Accounts receivable, net consists of the following:

Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption.

In December 2023, the FASB issued ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Topic 3580-60): Accounting for and Disclosure of Crypto Assets. Under the new guidance, an entity would be required to subsequently measure certain crypto assets at fair value, with changes in fair value included in net income in each reporting period. The proposed set of rules would also require presentation of crypto assets and related fair value changes separately in the balance sheet and income statement and require various disclosures in interim and annual periods. The Company’s adoption of ASU 2023-08 did not have a material impact on its consolidated financial statements since the Company’s policy is to dispose of Bitcoin received from mining routinely, usually no more than a few days after receipt. ASU 2023-08 is effective for fiscal years beginning after December 15, 2024 and interim periods within those fiscal years. The Company adopted ASU 2023-08 on January 1, 2025. There was no cumulative effect as of adoption.

In December 2023, the FASB issues ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. Under the new guidance, public business entities (“PBEs”) are required to disclose an annual tabular effective tax rate reconciliation using both reporting currency amounts and percentages, disaggregated into specified categories. ASU 2023-09 also requires PBEs to disclose annually the amount of income taxes paid, disaggregated by federal, state and foreign jurisdictions. ASU 2023-09 requires annual disclosure requirements to disaggregate income (loss) from continuing operations between domestic and foreign components and disaggregate income taxes expense (or benefit) between federal, state and foreign components. The Company’s adoption of ASU 2023-09 did not have a material impact on it consolidated financial statements since the Company’s operations are entirely domestic and amount of tax expense (benefit) recognized for the period is immaterial. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. The Company adopted ASU 2023-09 on a prospective basis on January 1, 2025.

Recent Accounting Pronouncements (Cont.)

In May 2025, the FASB issued ASU 2025-04, Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer. The amendments clarify that the probability of vesting for share-based consideration payable to a customer should be assessed under Topic 718 rather than Topic 606. The updates in ASU 2025-04 are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim periods within those annual periods. Early adoption is permitted. Either modified retrospective or a retrospective basis is permitted when applying the updated guidance upon adoption. The adoption of ASU 2025-04 did not have an effect on the Company’s financial statements because the Company did not grant share awards to customers.

Recently Issued Accounting Pronouncements Not Yet Adopted

In December 2025, the FASB issued ASU No. 2025-11, ”Interim Reporting (Topic 270): Narrow-Scope Improvements.” ASU 2025-11 clarifies interim disclosure requirements by adding a comprehensive list of required disclosures and introducing a disclosure principle to report significant events occurring since the previous year-end that have a material effect. The amendments are effective for the Company for interim periods beginning after December 15, 2027. The Company is currently evaluating the impact of ASU 2025-11, but does not expect it to significantly change the overall nature of its interim reporting.

In December 2025, the FASB issued ASU 2025-12, “Codification Improvements.” The amendments in this update clarify, correct, and otherwise improve a wide variety of Topics in the Codification. Notably, ASU 2025-12 clarifies the calculation of diluted earnings per share when a loss from continuing operations exists and requires that such changes be applied retrospectively. Other amendments are generally applied prospectively or retrospectively at the Company's election. ASU 2025-12 is effective for the Company for fiscal years beginning after December 15, 2026. The Company is currently evaluating the impact of these improvements, but does not expect the majority of the amendments to have a material impact on its consolidated financial statements.

In January 2025, the FASB issued ASU 2025-01, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date” (“ASU 2025-01”). ASU 2025-01 amends the effective date of ASU 2024-03 to clarify that all public entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. ASU 2024-03 improves financial reporting by requiring companies to disclose additional information about certain expenses in the notes to the financial statements. Early adoption is permitted. The Company is currently evaluating the potential impact of adopting this guidance on its consolidated financial statements.

NOTE 3 – SUBSIDIARY DECONSOLIDATION

The Company currently operates facilities in the United States and does not have operating sites in Australia.

MIG No.1

Liquidation and Deconsolidation of an Australian entity MIG No. 1

On March 19, 2024, the Company’s subsidiary MIG No.1, an Australian entity, was placed into an Australian court appointed liquidation due to it being deemed insolvent in Australia. The liquidation of an insolvent company in Australia allows an independent registered Australian liquidator (the liquidator) to take control of the Australian entity so its affairs can be wound up in an orderly and fair way and to benefit creditors. In the instance of MIG No.1, it is an Australian court liquidation, where a liquidator is appointed by the Australian court to wind up a company following an application (by a creditor of MIG No.1). As a result of this court appointed liquidation, the Company ceded authority for managing this Australian entity to the Australian liquidator, and the Company could not carry on MIG No.1’s activities in the ordinary course of business. For these reasons, it was concluded that the Company had ceded control of MIG No.1, and no longer had significant influence over this Australian entity since the liquidator was in control of this Australian entity. Therefore, MIG No.1 loss of control was effective when it was placed into Australian court appointed liquidation on March 19, 2024, and was deconsolidated at this date, in accordance with ASC 810-10-15. In order to deconsolidate this Australian entity, MIG No.1, the carrying values of the assets, liabilities and equity components previously recognized in accumulated other comprehensive income of MIG No.1 were removed from the Company’s consolidated balance sheet as of March 19, 2024, in accordance with ASC 810,Consolidation. The net impact of removing the assets and liabilities resulted in a loss on deconsolidation of $12.4 million being recorded in the consolidated statement of operations.

Investment in MIG No.1

The investment in MIG No. 1 held by the Company was accounted for under ASC 321,Investments — Equity Securities as it was concluded the Company did not have significant influence over MIG No. 1 from March 19, 2024. The fair value of MIG No.1 was estimated to be $0 at the time of the deconsolidation, MIG No.1 had negative equity, and its directors have no intention to carry out this business in the future.

Australian entity MIG No.1 Secured Loan Facility Agreement

MIG No. 1 has a Secured Loan Facility Agreement with Marshall. The loan matured in February 2024 and the total outstanding balance is $12.6 million as of December 31, 2025. The Company is included as a guarantor of this loan.

NOTE 3 – SUBSIDIARY DECONSOLIDATION (Cont.)

Mawson AU Pty Ltd

Liquidation and Deconsolidation of an Australian entity Mawson AU Pty Ltd

On April 23, 2024, the Company’s Australian entity and a subsidiary, Mawson AU was placed into an Australian court appointed liquidation. As a result of this court appointed liquidation, the Company ceded authority for this Australian entity to the Australian liquidator. It was concluded that the Company had ceded control of Mawson AU, and no longer had significant influence over this Australian entity since the liquidator was in control of this Australian entity. Therefore, Mawson AU loss of control was effective when it was placed into Australian court appointed liquidation on April 23, 2024, and was deconsolidated at this date, in accordance with ASC 810-10-15. In order to deconsolidate this Australian entity, Mawson AU, the carrying values of the assets, liabilities and equity components previously recognized in accumulated other comprehensive income of Mawson AU were removed from the Company’s consolidated balance sheet as of April 23, 2024, in accordance with ASC 810,Consolidation. The net impact of removing the assets and liabilities resulted in a gain on deconsolidation of $3.5 million being recorded in the consolidated statement of operations.

Investment in the Australian entity Mawson AU Pty Ltd

The investment in this Australian entity, Mawson AU, held by the Company was accounted for under ASC 321,Investments — Equity Securities as it was concluded the Company did not have significant influence over Mawson AU from April 23, 2024. The fair value of Mawson AU was estimated to be $0 at the time of the deconsolidation.

Treatment of intercompany balances

The Company had total receivables owed from Mawson AU of $3.8 million. In accordance with ASC 310, these receivables have been treated as external receivables from the date of liquidation, April 23, 2024 and written off in net loss on the deconsolidation in the consolidated financial statements.

Mawson Services Pty Ltd

Liquidation and Deconsolidation of an Australian entity Mawson Services Pty Ltd

On April 29, 2024, the Company’s Australian entity and a subsidiary, Mawson SPL was placed into an Australian court appointed liquidation. As a result of this court appointed liquidation, the Company ceded authority for this Australian entity to the Australian liquidator. For these reasons, it was concluded that the Company had ceded control of Mawson SPL, and no longer had significant influence over this Australian entity since the liquidator was in control of this Australian entity. Therefore, Mawson SPL loss of control was effective when it was placed into Australian court appointed liquidation on April 29, 2024, and was deconsolidated at this date, in accordance with ASC 810-10-15. In order to deconsolidate this Australian entity, Mawson SPL, the carrying values of the assets, liabilities and equity components previously recognized in accumulated other comprehensive income of Mawson SPL were removed from the Company’s consolidated balance sheet as of April 29, 2024, in accordance with ASC 810,Consolidation. The net impact of removing the assets and liabilities resulted in a gain on deconsolidation of $0.2 million being recorded in the consolidated statement of operations.

NOTE 3 – SUBSIDIARY DECONSOLIDATION (Cont.)

Mawson Services Pty Ltd (Cont.)

Investment in the Australian entity Mawson Services Pty Ltd

The investment in this Australian entity, Mawson SPL, held by the Company was accounted for under ASC 321,Investments — Equity Securities as it was concluded the Company did not have significant influence over Mawson SPL from April 29, 2024. The fair value of Mawson SPL was estimated to be $0 at the time of the deconsolidation.

Summary of the impact on consolidated statement of operations

NOTE 4 – BASIC AND DILUTED LOSS PER SHARE:

Net loss per common share is calculated in accordance with ASC 260,Earnings Per Share. Basic loss per share is computed by dividing net loss attributed to Mawson by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share is computed by dividing net loss attributed to Mawson by the weighted average number of shares of common stock outstanding plus the dilutive effect of unvested restricted stock units (“RSUs”), and outstanding warrants and options. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding, as they would be anti-dilutive.

Securities that could potentially dilute loss per share in the future that were not included in the computation of diluted loss per share as of December 31, 2025, and 2024, are as follows:

The following table sets forth the computation of basic and diluted loss per share:

NOTE 5 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment, net, consisted of the following:

The Company incurred depreciation and amortization expense in the amounts of $5.6 million and $17.9 million for the years ended December 31, 2025 and 2024, respectively.

There wereno impairment charges for the years ended December 31, 2025 and 2024.

NOTE 6 – SECURITY DEPOSITS

The Company’s security deposits consist of amounts paid by the Company to location providers in case of any event of default. The security deposits are refundable to the Company when location provider services cease or are cancelled. Security deposits are included in non-current assets on the consolidated balance sheets as such amounts are not expected to be refunded for at least twelve months after December 31, 2025. As of December 31, 2025 and 2024, the Company had $0.7 million and $0.5 million, respectively, in refundable security deposits.

NOTE 7 – LEASES

The Company’s operating leases are for digital asset mining sites and its finance leases which are primarily related to plant and equipment.

The Company leases 8-acres of land in Midland Pennsylvania under a lease which was amended and renewed in September 2024 for an additional thirty-six months. The lease can be renewed three more times for an additional nine years in total.

NOTE 7 – LEASES (Cont.)

Effective May 24, 2023, Mawson Bellefonte LLC entered into a lease agreement for a 9,918 square foot developed mining facility in Bellefonte, PA, which was amended and renewed in November 2025. The amended term of the lease is for seven years and seven months.

Effective May 1, 2023, Mawson Ohio LLC took an assignment of a lease agreement for approximately 64,600 square feet for an undeveloped site in Corning, Ohio. The term of the lease isfive years, with an option to extend for five years.

Other than the foregoing leases, the Company does not lease any other material assets. The Company believes that these facilities are suitable and adequate for its operations as currently conducted and foreseen.

The Company’s lease costs recognized in the consolidated statements of operations and comprehensive loss consist of the following:

The following is a schedule of the Company’s lease liabilities by contractual maturity as of December 31, 2025:

Other lease information as of December 31, 2025:

NOTE 8 – TRADE AND OTHER PAYABLES

NOTE 9 – LOANS

Outstanding loans as of December 31, 2025:

Description of Outstanding Loans

Marshall Loan

The Company is included as a guarantor of a disputed Secured Loan Facility Agreement (the “Marshall Loan”) by MIG No. 1 with Marshall. Investments GCP Pty Ltd ATF for the Marshall Investments MIG Trust (collectively, “Marshall”). The loan matured in February 2024 and bears interest at a rate of 12% per annum (with an overdue rate provision of an additional 500bps), payable monthly with interest payments that commenced in December 2021. This loan facility is secured by direct assets of MIG No. 1 and a general security agreement given by the Company. Principal repayments began during November 2022. According to the claims of Marshall, the outstanding balance including interest is $12.6 million as of December 31, 2025, all of which is currently classified as a current liability. There has been no principal and interest payments made since May 2023. See Note 10 – Commitments and Contingencies, Marshall Loan and W Capital Loan.

NOTE 9 – LOANS (Cont.)

Description of Outstanding Loans - (Cont.)

W Capital Loan

The Company is included as a guarantor of a disputed Secured Loan Facility Agreement (the “W Capital Loan”) for working capital by Mawson PL with W Capital Advisors Pty Ltd for the W Capital Advisors Fund (collectively, “W Capital”). As of December 31, 2025, the balance was AUD $2.5 million (USD $1.7 million), all of which is currently classified as a current liability. The W Capital Loan accrues interest daily at a rate of 12% per annum (with an overdue rate provision of an additional 800bps). The W Capital Loan expired in March 2023. See Note 10 – Commitments and Contingencies, Marshall Loan and W Capital Loan.

Celsius Promissory Note

On February 23, 2022, Luna entered into a Digital Colocation Agreement with Celsius Mining LLC. In connection with this agreement, Celsius Mining LLC loaned Luna a principal amount of $20.0 million, for the purpose of funding the infrastructure required to meet the obligations of the Digital Colocation Agreement, for which Luna issued a Secured Promissory Note (the “Celsius Promissory Note”) for repayment of such amount. The Celsius Promissory Note accrues interest daily at a rate of 12% per annum (with an overdue rate provision of an additional 200bps). Luna is required to amortize the loan at a rate of 15% per quarter, principal repayments began at the end of September 2022. The Celsius Promissory Note had a maturity date of August 23, 2023. The outstanding balance, including interest, is $10.8 million as of December 31, 2025, all of which is currently classified as a current liability. See Note 10 – Commitments and Contingencies, Celsius Promissory Note and Colocation Agreement.

Convertible Notes

On July 8, 2022, the Company issued secured convertible promissory notes to W-Capital in exchange for cash. The outstanding balance relates to the interest on the convertible note which has been accrued from July 2022 onwards and therefore the outstanding balance is $0.2 million as of December 31, 2025, all of which is classified as a current liability. On March 28, 2024, the Company was made a defendant in a civil suit before the Supreme Court of NSW in Sydney Australia, in the matter entitled “W Capital Advisors Pty Ltd in its capacity as trustee for the W Capital Advisors Fund v. Mawson Infrastructure Group, Inc.”, alleging a claim to seek USD $0.2 million as unpaid interest under a convertible note after the Company paid in full the principal of $0.5 million, and AUD $0.3 million under a loan deed, plus interest and costs for sums due claiming corporate guarantee by the Company for a “Variation Deed to Loan Deed” dated September 29, 2022, executed by its Australian entity, Mawson PL. The Company sought dismissal of the Australian proceedings arguing jurisdiction of any claims against the Company should be in the United States as set forth in the agreements between the parties. Despite its objections, on May 31, 2024, the Australian court ruled in favor of the Australian claimant and rendered a judgment against the Company under Australian law for US $0.2 million as unpaid interest plus interest and costs for sums due.

NOTE 10 – COMMITMENTS AND CONTINGENCIES

The Company accounts for its contingent liabilities in accordance with ASC 450Contingencies. A provision is recorded when it is both probable that a liability has been incurred, and the amount of the loss can be reasonably estimated. With respect to legal matters, provisions are reviewed and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. Legal costs incurred in connection with loss contingencies are expensed as incurred.

The Company is subject to the various legal proceedings and claims discussed below (and in Note 1) that have not been fully resolved and that have arisen in the ordinary course of business. In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss in excess of a recorded accrual, with respect to loss contingencies. However, the outcome of legal proceedings and claims brought against the Company is subject to significant uncertainty. Therefore, although management considers the likelihood of such an outcome to be remote, if one or more of these legal matters were resolved against the Company in a reporting period for amounts in excess of management’s expectations, the Company’s consolidated financial statements for that reporting period could be materially adversely affected.

Marshall Loan and W Capital Loan

The Marshall Loan was entered into with an Australian entity MIG No.1, which was placed into a court appointed liquidation and wind-up process and was deconsolidated from the Group on March 19, 2024. On March 19, 2024, Marshall appointed receivers and managers in Australia under the terms of their security relating to their secured loan facility. The direct assets that secure this loan include 5,372 Miners and 8 modular data centers (“MDCs”). These assets are held by MIG No.1 and therefore were included in the deconsolidation. The receiver’s statutory duty includes the obligation to sell the secured assets at market value or, if market value is not known, at the best price reasonably obtainable to maximize the prospects of there being sufficient proceeds available to satisfy the balance of the outstanding secured debt. Therefore, this loan balance may be offset in the future by the amount received from the sale of these Miners and MDCs. On June 25, 2024, Marshall inspected and inventoried the Miners and MDCs located at the Company’s Midland facilities. The Company is currently not utilizing these Miners or MDCs for its operations and has asked Marshall to take these assets out of the Company’s storage. Marshall has not responded to the Company’s request for these Miners and MDCs to be removed from the Company’s storage. The Company is reserving all its rights and remedies against Marshall.

The W Capital Loan was originally with Mawson Infrastructure Group Pty Ltd (“Mawson PL”), and this Australian entity was placed into Australian voluntary administration on October 30, 2023. On November 3, 2023, W Capital appointed receivers and managers in Australia under the terms of their security relating to their working capital facility. The Company has corresponded with W Capital and/or its representatives, the Company’s ongoing significant concerns about W Capital and James Manning, a former board director and Chief Executive Officer of the Company (“Manning”), being related parties. W Capital has not responded to the Company’s concerns in a manner satisfactory to the Company.

On October 3, 2024, a proceeding was filed by W Capital and Marshall against the Company before the Federal Court of Australia, New South Wales, in the matter entitled, “W Capital Advisors Pty Ltd, in its capacity as Trustee for the W Capital Advisors Fund, v. Mawson Infrastructure Group, Inc.”, No. NSD 1395/2024. In an effort to force the Company to pay the W Capital Loan and Marshall Loan, W Capital and Marshall sought to have the Company declared insolvent under Australian law on the grounds that the Company failed to pay W Capital the sums it claims the Company owed it under the aforesaid Australian judgment. On February 11, 2025, the Australian Court declared that Mawson be “wound up” under Australian law. However, Mawson has no assets, revenue or other business in Australia subject to Australian jurisdiction. It is unclear as to any adverse effect this ruling has on Mawson in the U.S. This Australian ruling completely disregarded the automatic stay in place as established by the Involuntary Petition (defined below). The Company has communicated its objections and concerns to these Australian liquidator and entities.

Concurrently with the above Australian litigation, on December 4, 2024, Marshall, W Capital, and Rayra Pty Ltd, as Trustee for the Mountainview Trust (“Rayra” and together with Marshall and W Capital, collectively, the “Original Petitioners”), all Australian entities, concurrently filed an involuntary petition (the “Involuntary Petition”) in the matter entitledIn Re Mawson Infrastructure Group, Alleged Debtor, Case No. 1:24-bk-12726, under chapter 11 (“Chapter 11”) of title 11, 11 U.S.C. § 101 through 1330 (the “Bankruptcy Code”), seeking a determination of the court to force the Company into a Chapter 11 proceeding. The Original Petitioners claimed in the Involuntary Petition that they have debts aggregating AUD$13.7 million (approximately USD$8.9 million). Subsequently, Liam Healy and Quentin Olde, in their capacity as Receivers and Managers of MIG No. 1 Pty Ltd (in Liq.), and John McInerney and Philip Campbell-Wilson of Grant Thornton Australia Limited, in their capacity as Joint and Several Liquidators of Mawson Services Pty Ltd. (In Liq.), later joined the Involuntary Petition as additional petitioning creditors (together with the Original Petitioners, collectively, the “Petitioning Creditors”). The Company disputed the validity of the Involuntary Petition and the Petitioning Creditors’ debt claims, and filed responsive pleadings and other remedies against the Petitioning Creditors for bad faith, pursue sanctions, and other damages as is allowed by applicable law.

On January 10, 2025, the Company filed an answer to the Involuntary Petition, and on May 5, 2025, the Company filed with the United States Bankruptcy Court for the District of Delaware a motion for bond and sanctions against the Petitioning Creditors for violating the automatic stay in the involuntary proceedings. On August 11, 2025, the Honorable Mary F. Walrath, Bankruptcy Judge for the United States Bankruptcy Court for the District of Delaware heard the Company’s motion and granted relief in favor of the Company imposing sanctions on the Petitioning Creditors requiring them to pay the Company’s attorney fees and post a bond before the Petitioning Creditors would be allowed to continue the involuntary proceedings.

During the course of this matter, the Company continued to operate in the ordinary course of business as authorized under 11 U.S.C. § 303(f). Nonetheless, under applicable federal law, all collection efforts by the Company’s creditors, including all of the Petitioning Creditors, continued to be stayed pending final resolution of the Involuntary Petition.

The parties filed pretrial motions seeking various remedies, including dismissal prior to trial, sanctions and attorney fees. On May 9, 2025, the Court granted Mawson’s motions for discovery from the Petitioning Creditors and paved a pathway for discovery of Manning—including from Australia if needed. The United States Bankruptcy Court for the District of Delaware denied Celsius’ previously filed motion for sanctions. The trial date was delayed indefinitely to allow for the completion of discovery and the opportunity for the parties to mediate.

As stated above, on May 5, 2025, Mawson filed a motion for sanctions against the Petitioning Creditors seeking, among other things, compelling discovery against the Petitioning Creditors, sanctions for bad faith, and payment of Mawson’s legal fees. The motions were heard by the United States Bankruptcy Court for the District of Delaware on August 11, 2025, wherein the Court ruled from the bench to sanction the Petitioning Creditors, required them to pay Mawson’s attorney’s fees incurred to date and further ordered the Petitioning Creditors to post a cash bond of $1.5 million before being allowed to proceed any further. Following successful motions brought by the Company against the filing parties in the Involuntary Petition, Marshall, as the largest claimant of the Petitioning Creditors, filed a motion to dismiss the Involuntary Petition on August 25, 2025. On October 21, 2025, the United States Bankruptcy Court for the District of Delaware held a hearing on the motion to dismiss and ordered the dismissal of the Involuntary Petition against the Company, while preserving Mawson’s rights to recover from the Petitioning Creditors all damages it incurred due to the bad faith filing of the Involuntary Petition. A written Order of Dismissal was signed by the judge on November 4, 2025 and the Involuntary Petition has been dismissed.

On December 29, 2025, the Company filed an adversary proceeding in the United States Bankruptcy Court for the District of Delaware against the Petitioning Creditors, seeking general and punitive damages, sanctions attorney fees and costs against the Petitioning Creditors.

Mawson learned that on or about October 20, 2025, one of the Australian Petitioning Creditors, W Capital, filed for commencement of Australian Insolvency Proceedings placing W Capital under receivership and ultimate liquidation in Australia. Mawson is one of W Capital’s largest creditors. Mawson expects to avail itself of all legal rights and remedies to which it may be entitled to recover from W Capital under applicable Australian and US laws.

As previously noted, the Company believes that W Capital and Marshall used these proceedings in Australia and the United States as a bad faith attempt to gain leverage in ongoing legal disputes between the parties.

The Company believes that W Capital and Marshall were using the Involuntary Petition and the Australian insolvency proceedings against the Company in an improper attempt to gain leverage in ongoing legal disputes between the parties. The Company believes that the filing of the Involuntary Petition was an extension of the ongoing disputes, including with Manning, and a continuation of the pattern of bad faith actions by Manning and the Petitioning Creditors, with the improper intention of harassing and intimidating the Company.

The matter was dismissed by the Court with prejudice on November 4, 2025. On December 29, 2025, Mawson filed an adversary proceeding in the matter against the Petitioning Creditors seeking bad faith damages, attorney fees, costs, and interest.

As previously reported Mawson has divested itself of any holdings in Australia and does not have any operating sites or assets in Australia. The Company currently operates facilities only in the United States.

Celsius Promissory Note and Celsius Colocation Agreement

Luna Squares has not repaid the Celsius Promissory Note as required on its stated maturity date and is claimed by Celsius to be in default. Celsius Mining LLC transferred the benefit of the Celsius Promissory Note to Celsius Network Ltd. and Celsius Network Ltd has notified Luna Squares that the default interest is payable.

On July 18, 2024, Celsius Network, LLC filed for arbitration of its claims against the Company with the American Arbitration Association in the matter entitledCelsius Network Ltd., Celsius Mining LLC and Ionic Digital Mining LLC v. Mawson Infrastructure Group, Luna Squares LLC and Cosmos Infrastructure LLC - Case 01-24-0006-4462. See Note 14 – Subsequent Events for information about the partial settlement of this case. On January 23, 2025, the arbitrator issued a Partial Final Award (the “Partial Final Award”) granting in part Celsius’ claim against Luna Squares on the outstanding promissory note executed by Luna Squares in favor of Celsius. The Partial Final Award granted Celsius monetary damages in the amount of $8.1 million, plus interest and attorney fees.

Celsius filed a motion seeking a partial award from the arbitrator against Mawson based on its corporate guarantee. The arbitrator granted this partial award in favor of Celsius.

On October 7, 2025, Celsius filed a petition with the Court to confirm its partial arbitration award against Mawson. Following this, on November 6, 2025, both parties agreed to jointly file a consent judgment and execute a forbearance agreement, which provided additional time for the parties to continue their discussions toward an amicable settlement of all outstanding matters. The Court signed the consent judgment on November 10, 2025.

On February 5, 2026, Celsius took formal steps to domesticate the judgment outside of New York. Currently, the parties are engaged in negotiations to resolve the ongoing litigation. On or about March 6, 2026, Celsius announced that it would voluntarily dismiss its remaining arbitration claims against the Company. Nevertheless, the Company’s claims and counterclaims for damages against Celsius remain active in the litigation process, and the Company is continuing to pursue these counterclaims and damages expeditiously.

The Company and/or its applicable subsidiaries have not fulfilled specific payment obligations related to the Marshall Loan, the W Capital Loan and the Celsius Promissory Note mentioned above. Consequently, the creditors associated with these debt facilities may initiate actions as allowed by relevant grace periods. This includes the possibility of opting to expedite the repayment of the principal debt, pursuing legal action against the Company or its subsidiaries for payment default, raising interest rates to the default or overdue rate, or taking appropriate measures concerning collateral (including appointing a receiver), if applicable.

Blockware

On April 19, 2024, a civil suit entitledBlockware Solutions, LLC v. Mawson Bellefonte LLC and Mawson Infrastructure Group, Inc. was filed in the United States District Court, Southern District of New York. The matter remains ongoing. However, the parties are actively pursuing informal settlement discussions.

CleanSpark

On July 16, 2024, the Company filed a civil lawsuit for its claims against CleanSpark, Inc. and CSRE Properties Sandersville, LLC with the United States District Court for the Southern District of New York in the matter entitled “Mawson Infrastructure Group, Inc. and Luna Squares, LLC v. CleanSpark, Inc. and CSRE Properties Sandersville, LLC”, Civil Action No. 1:24-cv-5379, for at least $2.0 million for breach of the Bill of Sale dated October 1, 2022, among the Company, CleanSpark Inc. and CSRE Properties Sandersville, LLC. On September 13, 2024, the defendants filed a motion to dismiss the proceedings, which was denied by the Court. The matter is proceeding through the court system.

Vertua

On March 16, 2022, Luna Squares entered into a lease with respect to a property in the City of Sharon, Mercer County, Pennsylvania (the “Sharon Lease”) with Vertua, a subsidiary entity in which Vertua Ltd has a 100% ownership interest. Manning is a director of Vertua Ltd and has a material interest in the Sharon lease as a significant stockholder of Vertua Ltd.

On September 6, 2024, Luna Squares filed a praecipe of lis pendens for the property leased in Sharon, Pennsylvania in the Court of Common Pleas of Mercer County, Pennsylvania in the matter entitled “Luna Squares Property, LLC v. Vertua Property, Inc.” under case No 2024-2332. It did so to also provide third parties such as Bitfarms Ltd. notice that the property is encumbered by a lease between Luna Property and Vertua. This property is the subject of a current civil lawsuit between the Company and Luna Property against Vertua. On October 17, 2024, the Company filed several claims in the matter captioned above against Vertua, including claims for breach of the lease agreement and wrongful termination of the lease, as well as for tortious interference with a business relationship. The Company is seeking reinstatement of the lease, compensatory damages, disgorgement of revenue, and exemplary and punitive damages, as well as reimbursement for its costs and litigation expenses. Vertua is a company related to Manning and also affiliated with Darron Wolter of W Capital. The matter is currently before the Court Common Pleas of Mercer County Pennsylvania., The matter remains ongoing.

Mewawalla Actions

On July 8, 2025, the Company filed a complaint in the Court of Chancery of the State of Delaware against the Company’s former CEO and President, Rahul Mewawalla captionedMawson Infrastructure Group Inc. v. Rahul Mewawalla, No. 2025-0789-JTL (the “Mewawalla Action”). The Mewawalla Action sought to recover damages from Mr. Mewawalla arising out of his alleged breach of fiduciary duties as a director, as well as alleged fraud. The action was dismissed without prejudice on February 13, 2026.

On December 8, 2025, Mr. Mewawalla filed a complaint in King County Superior Court in Washington State against the Company, the Company’s Chairman of the Board, Mr. Ryan Costello, Board Member, Steven Soles and Human Resources Director, Jonathan Sites (the “Washington State Action”). In the Washington State Action, Mr. Mewawalla is seeking damages for alleged retaliation, breach of contract, wage violations, discrimination related retaliation, whistleblower retaliation, and other statutory claims arising out of his employment and the termination of his employment with the Company. The Company categorically denies the allegations under the Washington State Action and is defending against the claims.

NOTE 11 – INCOME TAXES

Loss before income taxes consisted of losses from domestic operations of $23.7 million for the year ended December 31, 2025. Income tax expense included in the statements of operations and comprehensive loss consisted of the following:

Income tax expense differed from the amount computed by applying the Federal statutory income tax rate of 21% to pretax income (loss) for fiscal year 2025 as a result of the following:

Income tax expense differed from the amount computed by applying the Federal statutory income tax rate of 21% to pretax income (loss) for fiscal year 2024 as a result of the following:

NOTE 11 – INCOME TAXES (Cont.)

The tax effects of temporary differences that gave rise to significant portions of the Company’s deferred tax assets and liabilities related to the following:

Management believes that, based on available evidence, both positive and negative, it is more likely than not that the deferred tax assets will not be utilized. The valuation allowance increased by $4.6 million for the year ended December 31, 2025, primarily as a result of current year tax losses generated, as well as changes in tax versus book basis in fixed assets and stock compensation related activities.

As of December 31, 2025, the Company had approximately $84.2 million of indefinite lived US Federal net operating losses (“NOLs”), and $110.6 million of US state NOLs. The Internal Revenue Code “IRC” limits the amount of NOL carryforwards that a company may use in a given year in the event of certain cumulative changes in ownership over a three-year period as described in Section 382 of the IRC. Utilization of NOL carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. The Company has not conducted a Section 382 study as of December 31, 2025.

If recognized, any unrecognized tax benefits would not impact the Company’s effective tax rate due to the valuation allowance against deferred tax assets. As of December 31, 2025, the Company had no unrecognized income tax benefits. The Company’s policy is to classify interest and penalties associated with unrecognized tax benefits as income tax expense. The Company had no interest or penalty accruals associated with uncertain tax benefits in its consolidated balance sheet and consolidated statement of operations for the tax year ended December 31, 2025.

The Company files income tax returns in the U.S. Federal, U.S. State, and foreign jurisdictions. The Company is not currently under examination by income tax authorities in federal or state jurisdictions. All tax returns will remain open for examination by the federal and most state taxing authorities for three years and four years, respectively, from the date of utilization of any net operating loss carryforwards or research and development credits.

The Company has made no provision for U.S. income taxes on cumulative undistributed non-U.S. earnings as of December 31, 2025, as the Company is no longer currently operating in any jurisdictions outside the United States.

NOTE 12 – STOCKHOLDERS’ EQUITY (DEFICIT)

On October 16, 2025, the Company entered into the Sales Agreement with Wainwright, under which Wainwright will act as sales agent, to sell shares of our Common Stock having an aggregate sales price of up to $9.6 million, from time to time, through the ATM. On December 11, 2025, the Company filed the Prospectus Supplement with the SEC to increase the capacity of the ATM by $40 million. During the year ended December 31, 2025,2,468,729 shares were issued under the Sales Agreement for cash proceeds of $14.6 million, net of issuance costs. An additional 53,696 shares were issued due to fractional share rounding related to the Reverse Stock Split. The ATM shares and the fractional shares total the 2,522,425 shares issued during the year.

Pursuant to the Sales Agreement, the Company agreed to pay Wainwright a commission rate equal to 3.0% of the aggregate gross proceeds from each sale of Shares and have agreed to provide Wainwright with customary indemnification and contribution rights. In addition, we have agreed to reimburse Wainwright for fees and disbursements related to its legal counsel in an amount not to exceed $50,000. Additionally, pursuant to the terms of the Sales Agreement, we agreed to reimburse Wainwright for the documented fees and costs of its legal counsel reasonably incurred in connection with Wainwright’s ongoing due diligence from time to time arising from the transactions contemplated by the Sales Agreement in an amount not to exceed $2,500 in the aggregate per due diligence update. The Sales Agreement contains customary representations and warranties and conditions to the sale of the Shares pursuant thereto.

The Company is not obligated to sell any of the Shares under the Sales Agreement and may at any time suspend solicitation and offers thereunder. The offering of Shares pursuant to the Sales Agreement will terminate on the earlier of (1) the sale, pursuant to the Sales Agreement, of Shares having an aggregate offering price of $40 million and (2) the termination of the Sales Agreement by either the Company or an Agent, as permitted therein.

Restricted Stock Units

During the year ended December 31, 2025, there were settlements of restricted stock units into 155,178 shares of Common Stock and 72,562 shares of Common Stock were withheld for tax withholding purposes.

During the year ended December 31, 2024, there were settlements of restricted stock units into 103,145 shares of Common Stock and 69,841 shares of Common Stock were withheld for tax withholding purposes.

Restricted Stock

As of December 31, 2025 and 2024, there wasno restricted stock.

Series A Preferred Stock

As of December 31, 2025 and 2024, there areno shares of Series A Preferred Stock outstanding.

NOTE 12 – STOCKHOLDERS’ EQUITY (DEFICIT) (Cont.)

Common Stock Warrants

A summary of the status of the Company’s outstanding stock warrants and changes during the year ended December 31, 2025, is as follows:

NOTE 13 – STOCK BASED COMPENSATION

Equity plans

On April 9, 2024, the Board of Directors approved the 2024 Omnibus Equity Plan (the “2024 Plan”) which will provide an initial 500,000 shares of Common Stock available for grant per the terms of the 2024 Plan and provides alignment with long-term stockholder value creation. The 2024 Plan also provides for annual automatic increases in the number of shares of Common Stock reserved for issuance under the Plan. In addition, the shares available under the 2024 Equity Plan increased by 375,000 shares on February 21, 2025 to 875,000. The 2024 Plan was approved by the stockholders at the Company’s annual general meeting held on June 12, 2024. The 2024 Plan replaced and succeeded the Company’s 2018 Equity Incentive Plan and 2021 Equity Incentive Plan. The 2024 Plan provides that awards issued under the 2024 Plan, the 2018 Plan or the 2021 Plan that expire, lapse or are terminated, surrendered or canceled without having been fully exercised or are forfeited in whole or in part, in any case in a manner that results in any share of Common Stock covered by such award being reacquired by the Company or otherwise not being issued, such share of Common Stock shall again be available for the grant of awards under the 2024 Plan. Further, shares of Common Stock delivered (either by actual delivery or attestation) to the Company by a participant to (1) satisfy the applicable exercise or purchase price of an award, and/or (2) satisfy any applicable tax withholding obligation, in each case, shall be added to the number of shares of Common Stock available for the grant of awards under the 2024 Plan.

As of December 31, 2025, the number of shares allocated and available under the 2024 Plan were 485,725 shares and 389,276 shares, respectively.

NOTE 13 – STOCK BASED COMPENSATION (Cont.)

The Company recognized stock-based compensation expense during the years ended December 31, 2025 and 2024, as follows:

Performance-based awards

The Company maintains the 2024 Plan, under which equity-based awards may be granted to employees, directors, and consultants.

During the year ended December 31, 2025, the Company granted 18,750 restricted stock units (“RSUs”) to certain employees that vest solely upon the occurrence of a Change in Control, as defined in the 2024 Plan. These awards are classified as equity awards with performance-based vesting conditions.

In accordance with ASC 718, compensation cost related to these RSUs is recognized only when the performance condition is achieved. As of December 31, 2025, no Change in Control has occurred and management has determined that such an event is not probable. Accordingly, no stock-based compensation expense has been recognized related to these awards.

Upon the occurrence of a Change in Control, the Company will recognize stock-based compensation expense based on the grant-date fair value of the RSUs that become vested.

Performance-based awards generally vest over a three-year performance period upon the successful completion of specified market and performance conditions.

The following table presents a summary of the Company’s performance-based RSUs awards activity:

NOTE 13 – STOCK BASED COMPENSATION (Cont.)

Service-based restricted stock awards

Service-based awards generally vest over a one-year service period or as otherwise defined. Employees hired prior to 2025 were granted awards that vest over a four-year service period.

The following table presents a summary of the Company’s service-based awards activity:

As of December 31, 2025, there was approximately $6.9 million of unrecognized compensation cost related to the service-based restricted stock awards, which is expected to be recognized over a remaining weighted-average vesting period of approximately three years.

Stock options awards

Stock options awards vest upon the successful completion of specified market conditions.

The following table presents a summary of the Company’s Stock options awards activity:

As of December 31, 2025, there was no unrecognized compensation cost related to the stock options awards.

NOTE 14 – SUBSEQUENT EVENTS

Litigation

For updates subsequent to December 31, 2025, regarding the Marshall Loan, W Capital Loan, Celsius Promissory Note and Celsius Colocation Agreement, see Note 10 – Commitments and Contingencies.

Settlement of Litigation

On February 6, 2026, Mawson reached a confidential settlement with Ionic Digital Mining LLC (“Ionic”) to resolve all claims Ionic brought against Mawson and two of its subsidiaries related to the Celsius Colocation Agreement, all settlement amounts have already been paid. In addition, the Company entered a separate, unrelated settlement to resolve a customer dispute over a hosting arrangement. Together, these resolutions eliminate a large portion of the Company’s potential financial liability going forward. Mawson made no admission of liability or wrongdoing in reaching either of these settlements.

Adoption of Rights Agreement

On February 1, 2026, the Board of Directors (the “Board”) of the Company authorized and declared a dividend distribution of one right (each, a “Right”) for each outstanding share of Common Stock to stockholders of record as of the close of business on February 12, 2026 (the “Record Date”). Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series C Junior Participating Preferred Stock, par value $1.00 per share (the “Preferred Stock”), of the Company at an exercise price of $20.60 (the “Exercise Price”), subject to adjustment. The complete terms of the Rights are set forth in a Rights Agreement (the “Rights Agreement”), dated as of February 2, 2026, between the Company and Computershare Trust Company, N.A., a federally chartered trust company, as rights agent. Capitalized terms used herein that are not defined herein will have the meanings ascribed to them in the Rights Agreement.

The Board adopted the Rights Agreement to protect the interests of Company stockholders. In general terms, subject to certain enumerated exceptions, it works by imposing significant dilution upon any person or group that acquires beneficial ownership of 20% or more of the shares of Common Stock, or if a person or group with beneficial ownership of 20% or more at the time the adoption of the Rights Agreement is announced acquires any additional shares of Common Stock, without the prior approval of the Board. In general, any person will be deemed to beneficially own any securities (a) as to which such person has any agreement, arrangement or understanding with another person for the purpose of acquiring, holding, voting or disposing of any shares of Common Stock or (b) that are the subject of a derivative transaction or constitute a derivative security. As a result, the overall effect of the Rights Agreement and the issuance of the Rights may be to render more difficult or discourage a merger, tender or exchange offer or other business combination involving the Company that is not approved by the Board. However, neither the Rights Agreement nor the Rights should interfere with any merger, tender or exchange offer or other business combination approved by the Board.

For a summary of the terms of the Rights, the Rights Agreement and the Preferred Stock, please refer to the Company’s Form 8-K filed on February 2, 2026. Copies of the Certificate of Designation and the Rights Agreement were attached as Exhibits 3.1 and 4.1 to the Form 8-K filed on February 2, 2026 and are incorporated herein by reference.