OLENOX INDUSTRIES INC.

Current report

ITEM 1A. Risk Factors

Current report

Our business, financial condition, results of operations, and cash flows may be impacted by a number of factors, many of which are beyond our control, including those set forth in our most recent Annual Report on Form 10-K and in our other filings with the SEC, the occurrence of any one of which could have a material adverse effect on our actual results. There have been no material changes to the Risk Factors previously disclosed in our Annual Report on Form 10-K and our other filings with the SEC, except as follows:

Current report

On May 26, 2026, we closed the acquisition of CS Digital. We are in the process of integrating their operations and personnel with our own. If we are unable to complete this transition timely and effectively it could adversely affect our operations.

Current report

We are in the process of integrating the CS Digital personnel and operations into our operations since we closed the acquisition on May 26, 2026. Due to the size of the acquisition, and the fact CS Digital operates in the bitcoin mining business, we anticipate this transition will take some time. If we are not able to effectively and timely complete this transition it could adversely affect our operations and results.

Current report

The required final valuation for our acquisition of CS Digital has not been completed. We have also not completed the final purchase price accounting for the acquisition. Once these are completed, they may differ from our pre-closing expectations, which if they differ significantly could materially affect our financial results.

Current report

The CS Digital acquisition is subject to a final valuation report. As a result, if the results of that report differ significantly from our pre-closing expectations, it may materially impact our business and financial results.

Current report

The success of our CS Digital operations depends on external factors affecting the bitcoin industry.

Current report

The bitcoin industry has historically been subject to various asset-related risks that have negatively affected bitcoin’s market price. Ownership of bitcoin has traditionally been concentrated among a limited number of holders, whose large positions give them the ability to influence market prices. Although ownership has diversified in recent years, the large holders remain active in the market, and their trading behavior, such as selling substantial quantities of bitcoin, could adversely affect demand for, and the market price of, bitcoin. Any material decline in the price of bitcoin could adversely affect our business, financial condition, and results of operations. Although larger and increasingly regulated digital asset trading platforms have emerged, the bitcoin market remains nascent and relatively opaque compared to traditional financial markets. Trading venues for bitcoin may experience heightened operational issues and may be more susceptible to unethical, fraudulent, or illicit activities, including “wash trading,” than regulated securities exchanges. Digital asset trading platforms may also be vulnerable to “front-running,” in which market participants exploit technological or informational advantages to trade ahead of known or anticipated transactions for economic gain. Such practices are reported to be relatively common on both centralized and decentralized digital asset platforms. In addition, many bitcoin trading venues do not publicly disclose comprehensive information regarding their ownership structure, governance, corporate practices, or compliance with regulatory requirements. This lack of transparency limits the ability of market participants to assess the integrity or impartiality of these venues. The presence of large holders, combined with the bitcoin market’s limited transparency, susceptibility to manipulative trading practices, and comparatively low levels of regulatory oversight, may undermine public confidence in the integrity of bitcoin transactions and the reliability of bitcoin pricing. A resulting loss of confidence or decline in the market price of bitcoin, potentially significant, could adversely affect our business, financial condition, and results of operations.

Current report

There is a finite supply of bitcoin, and the declining block reward over time presents a risk to our business.

Current report

We generate revenue from bitcoin mining operations primarily through the receipt of block rewards for successfully validating transactions and adding new blocks to the Bitcoin blockchain. The total supply of bitcoin is finite, permanently capped at 21.0 million coins, and the number of new bitcoin issued per block decreases approximately every four years pursuant to the bitcoin protocol, in an event commonly referred to as a “halving.” The final bitcoin is expected to be mined around the year 2140. As of December 31, 2025, approximately 20.0 million bitcoin had been mined and were in circulation. As the bitcoin supply approaches its maximum limit, the block reward will continue to decline. Once the final new bitcoin has been issued, miners will no longer receive block rewards and will instead rely solely on transaction fees associated with the blocks they validate. Historically, transaction fees have represented a relatively small portion of total mining revenue. Although transaction fees have increased at various times due to network usage and reduced new-bitcoin issuance, we cannot predict whether such fees will increase, or remain at levels, sufficient to offset the decline in block rewards over time. If transaction fees do not rise to levels that support profitable mining operations, or if the economic incentives to mine otherwise diminish, our ability to generate revenue from bitcoin mining could be materially and adversely affected. In such circumstances, our business, financial condition, and results of operations could suffer, and the market price of our securities could be adversely affected.

Current report

Bitcoin mining is a highly competitive market, and if we fail to grow our hash rate in a cost-effective manner we may be unable to compete.

Current report

A bitcoin miner’s likelihood of successfully validating a block and earning the associated block reward is directly correlated to the miner’s hash rate relative to the global network hash rate. As adoption of bitcoin has increased, demand for bitcoin has drawn additional mining participants into the industry, resulting in sustained growth of the global network hash rate. As more miners enter the market and more efficient mining equipment is deployed, the global network hash rate is expected to continue increasing. Consequently, unless we are able to grow our hash rate at a pace consistent with industry growth, our probability of earning block rewards will decline. To remain competitive, we believe we must continue to obtain and deploy more efficient and energy-effective miners, both to replace units that are lost to ordinary wear-and-tear and to expand our hash rate to keep pace with increases in the global network hash rate. These miners are highly specialized servers that are difficult to manufacture at scale. As a result, only a limited number of suppliers are capable of providing miners in the quantities and performance specifications required by large-scale operators. Demand for new miners typically increases in periods of elevated bitcoin prices, and we have observed corresponding increases in miner pricing during such periods. If we are unable to procure an adequate number of new miners on acceptable terms, or if we are unable to access sufficient capital to fund the acquisition and deployment of such miners, we may be unable to grow our hash rate or maintain our competitive position. Any inability to expand or maintain our hash rate could adversely affect our business, financial condition, and results of operations, and could negatively impact the market price of our securities.

Current report

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

Current report

Between August 3 and August 14, 2026, JAK Industrial Ventures I LLC converted an aggregate of 80 shares of Series C Convertible Preferred Stock of Olenox Industries Inc., with an aggregate stated value of $80,000, plus an aggregate of $5,561 in accrued and unpaid dividends, resulting in an aggregate conversion amount of $94,117 and the issuance of 94,117 shares of common stock at a conversion price of $1.00 per share. The issuances of the foregoing securities were exempt from registration pursuant to Section 4(a)(2) of the Securities Act promulgated thereunder as the holder is an accredited investor and familiar with our operations.

Current report

ITEM 3. Defaults Upon Senior Securities

Current report

ITEM 4. Mine Safety Disclosures

Previous report

There have been no material changes to the risk factors previously disclosed in Part I, Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on June 30, 2026 (the “2025 Form 10-K”). The risks described in the 2025 Form 10-K are not the only risks we face. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, also may materially adversely affect our business, financial condition and results of operations. You should carefully consider the risk factors set forth in the 2025 Form 10-K, together with the other information contained in this Quarterly Report on Form 10-Q, before making an investment decision with respect to our common stock.

Previous report

None.