Nakamoto Inc.

NOTE 1—ORGANIZATION AND NATURE OF BUSINESS

Nakamoto Inc. (“Nakamoto” or “the Company”), formerly known as KindlyMD, Inc., was formed on December 2, 2019. The Company holds Bitcoin on its balance sheet and, through its ecosystem-wide presence, seeks to provide investors with exposure to Bitcoin’s global growth and to leverage its treasury to acquire and develop an ecosystem of Bitcoin companies across finance, media, advisory and more. Additionally, Nakamoto operates a healthcare and healthcare data company, focused on holistic pain management.

The Company filed its original articles of organization in the State of Utah under the name Utah Therapeutic Health Center, PLLC. In April 2020, the Company converted from a PLLC to an LLC. In March 2022, the Company converted from an LLC to a corporation and changed its name to “Kindly MD, Inc.” In July 2022, the Company amended its articles of incorporation, including the addition of preferred stock and authorized common shares. On December 17, 2025, the Company filed a certificate of conversion with the Delaware Secretary of State and subsequently converted from a Utah corporation to a Delaware corporation. On January 21, 2026, the Company changed its corporate name to Nakamoto Inc.

Initial Public Offering

On June 3, 2024, the Company completed its initial public offering (“IPO”), listing 1,240,910 units at a public offering price of $5.50 per unit. The Company’s common stock and tradable warrants were listed under the symbols “KDLY” and “KDLYW”, respectively. The Company used the net proceeds from the IPO of approximately $5.9 million for working capital and general corporate purposes. Additional details regarding the IPO are provided in Note 10.

Merger with Nakamoto Holdings, Inc.

On August 14, 2025, the Company acquired a privately held Bitcoin treasury company through a reverse triangular merger, whereby a wholly-owned subsidiary of Nakamoto merged with and into Nakamoto Holdings, Inc. (“Nakamoto Holdings”), with Nakamoto Holdings surviving as a wholly-owned subsidiary of the Company.

The stockholders of Nakamoto Holdings received 22,321,143 shares of Nakamoto common stock, par value $0.001 per share, as merger consideration based on the fair value of Nakamoto common stock price of $1.12 per share as set forth in the Agreement and Plan of Merger (the “Merger Agreement”) entered into on May 12, 2025, and as of August 14, 2025, the date of the closing of the Merger Agreement, resulting in total consideration of $24,999,679. See Note 3 for additional information regarding the Merger. On May 23, 2025, the Company’s shares began trading under the symbol “NAKA” and the Company’s tradable warrants under the symbol “NAKAW”.

As Nakamoto Holdings (i) did not meet the definition of a business under Accounting Standards Codification (“ASC”) Topic 805,Business Combinations (“ASC 805”), and (ii) qualified as a variable interest entity (“VIE”) under ASC 810,Consolidation (“ASC 810”), the transaction was accounted for as a forward merger with Nakamoto being considered the primary beneficiary of Nakamoto Holdings. In accordance with ASC 810, the Company recognized a loss on the acquisition measured as the difference between the fair value of the consideration paid and the net amount of Nakamoto Holding’s identifiable assets and liabilities.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and in conformity with the instructions on Form 10-K and Article 8 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (the “SEC”). The consolidated financial statements include the amounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements reflect all adjustments consisting of normal recurring accruals, which are, in the opinion of management, necessary for a fair presentation of such statements.

Use of Estimates

The preparation of these consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as the disclosure of contingent assets and liabilities, at the date of and during the reported period of the consolidated financial statements. Actual results could differ from those estimates. The Company evaluates estimates and assumptions on an ongoing basis.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand and highly liquid investments with original maturities of three months or less.

Reclassifications

Certain reclassifications within the balance sheets and operating expenses have been made to the prior period’s financial statements to conform to the current period financial statement presentation. There was no impact in total to the results of operations and cash flows in any of the periods presented.

Revenue Recognition

The Company records revenue in accordance with FASB ASC Topic 606, “Revenue from Contracts with Customers.” Revenue is recognized to depict the transfer of 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. To achieve this core principle, the Company applies the following five-step approach: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligations in the contract; and (5) recognize revenue when or as a performance obligation is satisfied. The Company primarily recognizes revenue from patient care services related to medical evaluation and treatment, which is discussed further below.

Patient Care Services

Revenue from patient care services, which relates to medical evaluation and treatment, is reported at the amount reflecting the consideration to which the Company expects to be entitled in exchange for providing these services. These amounts are due from patients, third-party payors (including Medicare, Medicaid, and commercial insurance payers), and others. The patient is considered the Company’s customer, and a signed patient treatment consent typically constitutes a written contract between the Company and the patient. Patient care services are considered discrete and are initiated and concluded at the patient’s discretion, which occurs each individual appointment. Generally, the Company satisfies its performance obligations at a point in time, specifically when it has the right to invoice the customer for the work completed, which usually occurs on an interaction basis for the work performed during any given billable interaction. The Company has determined that the underlying nature of the services provided remains consistent across different payor types. Consequently, the Company utilizes a portfolio approach to assess price concessions in its contracts with patients. The Company recognizes revenue for patient care services net of price concessions, which include contractual adjustments provided to third-party payors, discounts offered to uninsured patients in accordance with the Company’s policy, and/or implicit price concessions extended to patients. Implicit price concessions, representing differences between the amount the Company expects to receive from patients and standard billing rates, are accounted for as contractual adjustments or discounts, deducted from gross revenue to calculate net revenues. The Company bases its estimates of contractual adjustments and discounts on contractual agreements, its discount policies, and historical experience.

Leases

The Company accounts for leases in accordance with ASC Topic 842, “Leases.” The Company determines whether a contract is a lease at contract inception or for a modified contract at the modification date. Contracts containing a lease are further evaluated for classification as a ROU operating lease or a finance lease.

At inception or modification, the Company recognizes ROU assets and related lease liabilities on the balance sheet for all leases greater than one year in duration. Lease liabilities and their corresponding ROU assets are initially measured at the present value of the unpaid lease payments as of the lease commencement date. If the lease contains a renewal and/or termination option, the exercise of the option is included in the term of the lease if the Company is reasonably certain that a renewal or termination option will be exercised. As the Company’s leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate (“IBR”) based on the information available at the commencement date of the respective lease to determine the present value of future payments. The IBR is determined by estimating what it would cost the Company to borrow a collateralized amount equal to the total lease payments over the lease term based on the contractual terms of the lease and the location of the leased asset.

Operating lease payments are recognized as an expense on a straight-line basis over the lease term in equal amounts of rent expense attributed to each period during the term of the lease, regardless of when actual payments are made. This generally results in rent expense in excess of cash payments during the early years of a lease and rent expense less than cash payments in later years. The difference between rent expense recognized and actual rental payments is typically represented as the spread between the ROU asset and lease liability.

When calculating the present value of minimum lease payments, the Company accounts for leases as one single lease component if a lease has both lease and non-lease components. Variable lease and non-lease components are expensed as incurred. The Company does not recognize ROU assets and lease liabilities for short-term leases that have an initial lease term of 12 months or less.

Fair Value of Financial Instruments

The fair value of a financial instrument is the amount the Company would receive to sell an asset, or pay to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. In the absence of such data, fair value is estimated using internal information consistent with what market participants would use in a hypothetical transaction.

According to ASC Topic 820, “Fair Value Measurement,” the fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value. The Company’s assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy. The Company uses appropriate valuation techniques based on available inputs to measure the fair value of its assets and liabilities. The fair value hierarchy is defined in the following three categories:

Level 1: Quoted prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

The carrying value of our notes payable approximate fair value given the instruments were issued at prevailing market interest rates.

Digital Assets

The Company accounts for its digital assets, which as of December 31, 2025, are currently comprised solely of Bitcoin, as indefinite-lived intangible assets in accordance with ASC Topic 350-60,“Intangibles – Goodwill and Other – Crypto Assets.” The Company has ownership of and control over its digital assets and may use third-party custodial services to secure it. The Company’s digital assets are initially recorded at cost and are subsequently remeasured on the balance sheet at fair value.

The Company determines the fair value of its digital assets on a recurring basis in accordance with ASC 820,“Fair Value Measurements,” based on quoted prices on Anchorage Digital, an active platform that the Company has determined is its principal market for such digital assets (Level 1 inputs). The Company determines the cost basis of digital assets using the specific identification of each unit received. Realized and unrealized gains and losses from changes in the fair value of digital assets are recognized in the consolidated statements of operations. The cost basis of Bitcoin sold or otherwise disposed of is determined using the first-in, first-out (“FIFO”) method, whereby the cost of the earliest acquired Bitcoin is used to calculate realized gains and losses upon disposal.

Digital Asset-Denominated Borrowings

The Company accounts for borrowings denominated in or repayable in nonfinancial digital assets as hybrid instruments in accordance with the AICPA Digital Assets Practice Aid. Where the settlement currency of a debt instrument is a nonfinancial intangible digital asset, the arrangement consists of a host debt contract carried at historical cost and an embedded derivative representing the Company’s exposure to changes in the digital asset’s exchanged rate relative to the U.S. dollar. The embedded derivative is evaluated for bifurcation under ASC 815-15-25-1 at inception. Where the embedded derivative has a fair value of zero at inception and the effect of subsequent remeasurement is not material to the consolidated financial statements, the Company recognizes changes in fair value of the embedded derivative in changes in fair value of digital assets and presents the net carrying amount of the hybrid instrument as a single line item on the consolidated balance sheet.

Acquisitions

The Company accounts for acquisitions in accordance with ASC 805,“Business Combinations.” The Company evaluates each transaction to determine whether the acquired set of assets and activities constitute a business. If the acquired set meets the definition of a business, the transaction is accounted for as a business combination, and the Company recognizes the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest at their respective acquisition date fair values. Any excess of the purchase consideration over the fair value of the net identifiable assets acquired is recorded as goodwill. If the acquired set does not meet the definition of a business, the transaction is accounted for as an asset acquisition, and the cost of the group of assets acquired are allocated to the individual assets acquired or liabilities assumed based on their value without giving rise to goodwill.

Investments in Equity Securities

The Company’s investments in equity securities consist of minority interests in unconsolidated affiliates. The Company evaluates each investment to determine whether it has the ability to exercise significant influence over the investee’s operating and financial policies, which determines the applicable accounting framework.

Equity Method Investments

Investments in entities over which the Company has the ability to exercise significant influence, but not control, are accounted for under the equity method in accordance with ASC 323, “Investments – Equity Method and Joint Ventures.” Significant influence is generally presumed to exist when the Company holds 20% or more of the voting interests of an investee, though the Company considers all relevant facts and circumstances in making this determination. Under the equity method, the investment is initially recorded at cost and subsequently adjusted for the Company’s proportionate share of the investee’s net income or loss and any distributions received. The Company evaluates equity method investments for impairment whenever events or circumstances indicate that a decline in fair value below carrying value may be other than temporary. Where the Company does not receive timely financial information from an investee, the Company may record its proportionate share of the investee’s results on a one-quarter lag.

Equity Securities Without Significant Influence

Investments in equity securities over which the Company does not have the ability to exercise significant influence are accounted for in accordance with ASC 321, “Investments – Equity Securities.” Investments in publicly traded equity securities are measured at fair value, with unrealized gains and losses recognized in earnings for each reporting period. Fair value is based on quoted market prices of the investee’s common stock on the applicable exchange, re-measured into U.S. dollars using the period end spot foreign exchange rate when denominated in a foreign currency. Investments in privately held equity securities that do not have readily determinable fair values are accounted for under the measurement alternative in ASC 321-10-35-2. These investments are initially recorded at cost and are subsequently adjusted for observable price changes in orderly transactions for the identical or similar securities and for impairments when events or circumstances indicate the carrying amount may not be recoverable. Qualitative impairment assessments are performed quarterly and consider factors such as investee financial performance, macroeconomic conditions, and regulatory developments.

For equity investments denominated in foreign currencies, changes in fair value reflect the combined effect of market price movements and foreign-currency re-measurement adjustments. For publicly traded equity securities measured at fair value through net income, all changes in fair value, including those resulting from foreign currency gains or losses, are recognized in earnings.

See Note 6 for further information.

Intangible Assets

In 2025, the Company issued Common Stock and digital assets totalling approximately $3.0 million for the acquisition of an intangible asset. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, then the Company is required to perform a quantitative test. The Company determined that no impairment exists for its indefinite-lived intangible asset during the year ended December 31, 2025.

Related Parties

The Company identifies related parties and transactions with such parties in accordance with ASC 850,“Related Party Disclosures.” Related parties include affiliates, principal owners, directors, executive officers, and entities under common control. Transactions with related parties are recorded at amounts that are considered to approximate arm’s length terms. The Company discloses all material related party transactions and outstanding balances in the accompanying consolidated financial statements and related footnotes.

Segments

The Company identifies reporting segments based on how the chief operating decision maker (“CODM”) regularly reviews financial information to allocate resources and assess performance. Our CODM, who is our Chief Operating Officer, reviews financial information presented on a consolidated basis accompanied by disaggregated information about revenues and operating income by our two reportable segments.

Income Taxes

The Company accounts for income taxes under ASC 740, “Income Taxes,” using the asset and liability method. Under this approach, deferred tax assets and liabilities are recorded for the future tax effects of differences between the amounts reported in the consolidated financial statements and the amounts used for tax purposes.

Deferred tax assets may arise from temporary differences, net operating loss carryforwards, and tax credit carryforwards, while deferred tax liabilities result from temporary differences that will increase taxable income in future periods. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply when the temporary differences reverse. The impact of changes in tax laws or rates is recognized in income in the period the law is enacted.

A valuation allowance is recorded when it is “more likely than not” that some or all of a deferred tax asset will not be realized. As of December 31, 2025 and 2024, the Company recorded a valuation allowance that fully offsets its net deferred tax assets.

Treasury Stock

Treasury stock repurchased and held by the Company is recorded as a separate line item on the balance sheets and is carried at cost until retired or reissued.

Stock-Based Compensation

Stock-based awards granted to qualified employees, non-employee directors and consultants are measured at fair value and recognized as an expense in accordance with ASC Topic 718, “Share-Based Payments.” For service-based awards, stock-based compensation is recognized on a straight-line basis over the requisite service period, which is generally the vesting period. The fair value of stock options is estimated using a Black-Scholes option valuation model. Restricted stock awards are valued based on the closing stock price on the date of grant. The Company has elected to recognize forfeitures as they occur.

Embedded Derivatives

The Company evaluates embedded features in accordance with ASC Topic 815, “Derivatives and Hedging Activities.” Certain conversion options and redemption features are required to be bifurcated from their host instrument and accounted for as free-standing derivative financial instruments should certain criteria be met. The Company applies significant judgment to identify and evaluate complex terms and conditions of all of its financial instruments, including notes payable, to determine whether such instruments are derivatives or contain features that qualify as embedded derivatives. Embedded derivatives must be separately measured from the host contract if all the requirements for bifurcation are met. The assessment of the conditions surrounding the bifurcation of embedded derivatives depends on the nature of the host contract and the features of the derivatives. Bifurcated embedded derivatives are recognized at fair value, with changes in fair value recognized in the statement of operations each period.

Loss Per Share

Basic loss per share is calculated using the two-class method, which is an earnings calculation formula that treats participating securities as having rights to earnings that otherwise would have been available to common stockholders. The Company’s participating securities as of December 31, 2025 consist of tradeable and non-tradeable warrants that are convertible into 486,718 common shares. These warrants contain nonforfeitable rights to participate in dividends with common stockholders.

Under the two-class method, net income (loss) is allocated between common stockholders and participating securities based on their respective rights to share in earnings. During periods of net loss, no allocation is made to participating securities because they do not have a contractual obligation to share in the losses of the Company. Basic loss per share is calculated by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period.

Diluted loss per share is calculated by adjusting the weighted average number of shares of common stock outstanding for the dilutive effect, if any, of common stock equivalents. Common stock equivalents whose effect would be antidilutive are not included in diluted loss per share. The Company uses both the two-class and treasury stock methods to determine diluted earnings per share, and the more dilutive amount is reported. For periods in which the Company reports a net loss, diluted loss per share is the same as basic loss per share since all potential common shares are antidilutive.

Recently Adopted Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-08, “Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets,” which requires certain crypto assets to be measured at fair value in the statement of operations, with gains and losses from changes in the fair value of such crypto assets recognized in net income each reporting period. ASU 2023-08 also requires certain interim and annual disclosures for crypto assets within the scope of the standard. ASU 2023-08 is effective for annual periods beginning after December 15, 2024, including interim periods within those fiscal years. The Company adopted ASU 2023-08 on January 1, 2025. The Company did not have any crypto assets as of the adoption of the new standard. As such, the adoption did not have a material impact on the Company’s financial statements.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which enhances the transparency and decision usefulness of income tax disclosures by requiring; (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted. These amendments are to be applied prospectively, with retrospective application permitted. The Company adopted the new standard on December 31, 2025. Refer to Note 13 for the additional disclosure provided as a result of our adoption of the ASU.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,” which requires the disaggregated disclosure of specific expense categories, including purchases of inventory, employee compensation, depreciation, and amortization included in each relevant expense caption presented on the statement of operations. The standard also requires disclosure of qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, as well as the total amount of selling expenses and an entity’s definition of selling expenses. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The Company is currently evaluating the impact this standard will have on its financial statements.

The Company currently believes there are no other issued and not yet effective accounting standards that are materially relevant to its financial statements.

NOTE 3—ASSET ACQUISITION

Merger with Nakamoto Holdings

On May 12, 2025, the Company entered into the Merger Agreement, by and among the Company, the Company’s newly formed, wholly-owned subsidiary Kindly Holdco Corp., a Delaware corporation (“Merger Sub”), Nakamoto Holdings Inc., a Delaware corporation, and Wade Rivers, LLC, a Wyoming limited liability company.

On August 14, 2025 (the “Closing Date”), the Company effected a reverse triangular merger with Nakamoto Holdings, whereby Merger Sub merged with and into Nakamoto Holdings, with Nakamoto Holdings surviving as a wholly owned subsidiary of the Company (the “Surviving Corporation”), in accordance with the Merger Agreement (such transaction, the “Merger”). In connection with the Closing, the Company acquired all of the issued and outstanding securities of Nakamoto Holdings, a privately held Bitcoin treasury company.

Upon consummation of the Merger on the terms and subject to the conditions set forth in the Merger Agreement, the holders of Nakamoto Holdings Class A and Class B common stock (other than shares held in treasury or by dissenting stockholders) received an aggregate 22.3 million shares of Common Stock. Shares of Merger Sub’s common stock were converted into shares of common stock of the Surviving Corporation. No fractional shares were issued.

Concurrently with the execution of the Merger Agreement, the Company entered into subscription agreements (collectively, the “Initial Subscription Agreements”) with certain accredited investors (the “Initial Subscribers”) in an aggregate amount of approximately $512 million, pursuant to which the Company agreed to issue, and the Initial Subscribers agreed to purchase,322,979,583 shares of Common Stock at a purchase price of $1.12 per share and/or 133,800,773 pre-funded warrants to purchase shares of Common Stock (the “Pre-Funded Warrants”), in a private placement (the “Initial PIPE Financing”). Additionally, the Company entered into a Secured Convertible Debenture Purchase Agreement (the “Debenture Purchase Agreement”) with YA II PN, Ltd., an investment fund managed by Yorkville Advisors (the “Convert Investor”), under which the Company agreed to sell and issue to the Convert Investor a secured convertible debenture (the “Convertible Debenture”) in aggregate principal amount of $200.0 million (the “Principal Amount”) in exchange for cash or Bitcoin equal to 96.0% of the Principal Amount (the “Debt Financing”).

Additionally, on June 19, 2025, the Company subsequently entered into additional subscription agreements, (the “Additional Subscription Agreements” and, together with the Initial Subscription Agreements, the “Subscription Agreements”), with certain new and/or existing investors (the “Additional Subscribers” and, together with the Initial Subscribers, the “Subscribers”) in an aggregate amount of approximately $28 million. Under these Additional Subscription Agreements, the Company agreed to issue and sell to the Additional Subscribers 5,682,586 shares of Common Stock at a purchase price of $5.00 per share in a private placement on substantially similar terms as the Initial Subscription Agreements (the “Additional PIPE Financing” and, together with the Initial PIPE Financing, the “PIPE Financings”). The Company received net proceeds after issuance costs of approximately $518 million from the PIPE Financings.

The Company also issued 14,530,063 shares of Common Stock as compensation to certain advisors in connection with the PIPE Financings.

Accounting for the Merger

Pursuant to the Merger Agreement, the stockholders of Nakamoto Holdings received 22,321,143 shares of Common Stock as consideration for the Merger. Such shares of Common Stock were issued on August 14, 2025, based on the fair value of $1.12 per share, resulting in total consideration of $24,999,679. The stock price of $1.12 per share was determined based on the price of the Company’s Common Stock in the PIPE Financings that closed on the same date, in which the Company issued 346,192,232 shares of Common Stock. The Company concluded that the $1.12 per share price used in the PIPE Financings more accurately represented the fair value of the Common Stock on the acquisition date than the closing market price of $15.02 per share reported on the Nasdaq Stock Market.

In accounting for the transaction, the Company concluded that (i) Nakamoto Holdings was a variable interest entity at the acquisition date (“VIE”) under ASC 810,“Consolidation”, as its pre-Merger equity capitalization was (by design) not sufficient to finance its activities without additional subordinated financial support, and (ii) Nakamoto was the primary beneficiary. As such, Nakamoto recognized a $59,753,811 loss on the acquisition measured as the difference between the fair value of the consideration transferred and the net amount of Nakamoto Holdings’ identifiable assets and liabilities measured in accordance with ASC 805, which was primarily comprised of the put option liability.

Loss on Acquisition Calculation

As discussed above, the Company recognized a loss of $59,753,811 on the acquisition of Nakamoto Holdings in accordance with ASC 810-10-30, calculated as the difference between the sum of the fair value of the consideration paid and the net amount of the VIE’s identifiable assets and liabilities recognized and measured in accordance with ASC 805.

The recognized loss on the acquisition as of August 14, 2025 was calculated as follows:

Call Option Asset – BTC Marketing and Sales Agreement

In connection with the Merger, the Company assumed a Marketing and Sales Agreement from Nakamoto Holdings (the “BTC Media Agreement”) with BTC Media LLC (“BTC Media”). The BTC Media Agreement provides for certain marketing and promotional rights and includes put and call options (collectively, the “Options”) that permit either the Company to acquire, or BTC Media to sell, an equity interest in BTC Media. The call/put option had an exercise period of 36 months beginning with the date of the merger.

If exercised, the Options would be settled through the issuance of shares of Common Stock, with the number of shares determined based on BTC Inc’s enterprise valuation (calculated as BTC Media’s EBITDA multiplied by an agreed upon multiple) divided by the PIPE Financing price of $1.12 (“the call consideration”).

The Company analyzed the put and call options in the BTC Media Agreement under the relevant accounting guidance, including ASC 480,“Distinguishing Liabilities from Equity”and ASC 815,“Derivatives and Hedging”.

Based on that analysis, the Company concluded that the put and call options should be considered a non-derivative asset or liability in accordance with ASC 815-40 and should therefore be re-measured to fair value at the end of each reporting period. As of the date the transaction, the Company concluded that the call/put option was a liability with a fair value of $27,314,000. Further, upon re-measurement of the call/put option as of December 31, 2025, the Company determined that the fair value of the call/put option resulted in a $199,060,000 call option asset on the consolidated balance sheets. The $226,374,000 change in fair value was recognized as a gain in the consolidated statement of operations under Non-operating income (expense) during the year ended December 31, 2025 and was primarily the result of the decrease in fair value the Company’s Common Stock as of December 31, 2025 as compared to the fair value as of August 14, 2025.

As discussed in Note 14, the Company considers BTC Inc to be a related party as it has significant influence over that entity. To that extent, the Company determined that the call option should not be considered in-substance Common Stock (resulting in recognition using the equity method investment) as the call option does not have risks and rewards that are substantially similar to an investment in that entity’s common stock.

NOTE 4—PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid assets and other current assets consisted of the following at December 31, 2025 and 2024:

NOTE 5—DIGITAL ASSETS

The Company holds Bitcoin on its balance sheet as part of its Bitcoin operating strategy. The cost basis of Bitcoin sold or otherwise disposed of is determined using the FIFO method, whereby the cost of the earliest acquired Bitcoin is used to calculate realized gains and losses upon disposal.

Digital assets consisted of the following at December 31, 2025:

As of December 31, 2025,3,717 of the Company’s 5,342 Bitcoin were pledged as collateral in connection with an outstanding loan with a third-party lender (see Note 9). The pledged Bitcoin cannot be rehypothecated, loaned, or sold by the lender under the terms of the collateral arrangement. The remaining Bitcoin are held with a third-party custodian and are considered under the Company’s control.

The fair value of the pledged Bitcoin subject to this contractual sale restriction was approximately $325,300,000 as of December 31, 2025. The restriction remains in effect through the maturity of the loan on December 4, 2026. The restriction would lapse upon full repayment of the outstanding loan balance.

The following table presents a reconciliation of the Company’s Bitcoin activity for the year ended December 31, 2025:

During the year ended December 31, 2025, additions to the Company’s Bitcoin digital assets consisted primarily of open market purchases of Bitcoin using proceeds from the PIPE Financings (see Note 3). Dispositions during the period consisted primarily of sales of Bitcoin for cash to fund strategic investments totalling approximately $45,700,000 and transfers of Bitcoin as noncash consideration for the purchase of other assets totalling approximately $1,900,000. The Company recognized a realized loss in 2025 on the dispositions of Bitcoin of approximately $2,200,000.

NOTE 6—INVESTMENTS

Treasury B.V.

On September 4, 2025, Nakamoto Holdings, the Company’s wholly-owned subsidiary, made an investment in Treasury B.V., a private limited liability company under the laws of the Netherlands (the “Minority Investment”). In connection with the Minority Investment, Nakamoto Holdings entered into a Private Deed of Issuance by and among Treasury, Stichting Administratiekantoor Treasury, a foundation under the laws of the Netherlands (“Stichting”), and Nakamoto, pursuant to which Treasury agreed to issue to Stichting 1,363,027 (the “Issuance”) ordinary shares of Treasury, par value €0.01 (the “Treasury Shares”), in exchange for €12,835,870.08 (approximately $15.0 million). In connection with the Minority Investment, Stichting issued 1,363,027 depositary receipts, representing each of the Treasury Shares, to Nakamoto Holdings in exchange for a subscription price of approximately €9.42 (approximately $10.98) per depositary receipt, for an aggregate of €12,835,870.08 (approximately $15.0 million) to be paid directly to Treasury by Nakamoto Holdings in USD Coin (USDC).

The Company owns approximately 31.9% of the outstanding equity interest in Stichting and approximately 27.6% of Treasury on a look-through basis. The Company concluded that it has significant influence over Treasury and accounts for its investment under the equity method in accordance with ASC 323. The Company records its proportionate share of Treasury’s net income or loss on a one-quarter lag.

As of December 31, 2025, the carrying amount of the investment is $14,982,929. For the year ended December 31, 2025, the Company recorded an unrealized loss on investment of $17,071 in Loss on investments in the consolidated statements of operations.

Metaplanet Inc.

On September 9, 2025, Nakamoto Holdings, a wholly-owned subsidiary of the Company, made a commitment to purchase up to $30 million of shares of common stock of Metaplanet Inc. (the “Metaplanet Stock”), a corporation organized under the laws of Japan, (TSE: 3350) (OTC: MTPLF) (“Metaplanet”), in connection with Metaplanet’s previously announced international equity financing (the “International Offering”).

Nakamoto Holdings paid a purchase price of $3.751 per share for a total of 8,000,000 shares of Metaplanet Stock. The International Offering closed on September 17, 2025. No separate share purchase agreement or subscription document was required to be signed by the Company in connection with its commitment.

Although both David Bailey, Nakamoto’s Chief Executive Officer and Chairman of the Board, and Tyler Evans, Nakamoto’s Chief Investment Officer, hold certain advisory and board positions with Metaplanet, management concluded that Nakamoto Holdings does not exercise significant influence over Metaplanet’s operating or financial policies. As such, the investment in Metaplanet is recognized at fair value in accordance with ASC 321.

As the Metaplanet Stock is publicly traded on the Tokyo Stock Exchange, the investment has a readily determinable fair value. Therefore, the investment is measured at fair value with changes in fair value recognized in net income. To that extent, the investment was initially recorded at its cost basis of $30,007,992 as of the investment date. As of December 31, 2025, the carrying amount of the investment is $20,714,391. For the year ended December 31, 2025, the Company recorded an unrealized loss on investment of $9,293,601, inclusive of a loss on foreign currency re-measurement of $1,709,104, in Loss on investments on the consolidated statements of operations. As of December 31, 2025, the Company owned 8,000,000 shares of Metaplanet Stock. In Q1 2026, the Company sold 5,000,000 shares of its Metaplanet stock for approximately $11.1 million.

Future AG

On October 29, 2025, Nakamoto Holdings entered into a convertible loan agreement (the “Convertible Loan”) with Future Holdings AG, a Swiss stock corporation, (“Future”), pursuant to which Nakamoto advanced 55.65 Bitcoin (approximately $5.7 million) to Future. The Convertible Loan bore zero interest and had a 12-month maturity date with mandatory conversion into registered shares of Future upon satisfaction of certain conditions.

The Convertible Loan represented an unsecured, unsubordinated obligation of Future ranking pari passu with all other unsecured and unsubordinated of obligations. Nakamoto did not have significant influence over Future operating or financial policies.

On December 24, 2025, the Convertible Loan was unwound and Nakamoto received $5,042,424 in full settlement. The Company recognized a loss on investment of $605,073 in Loss on investments in the consolidated statements of operations for the year ended December 31, 2025. As of December 31, 2025, the Company has no remaining investment in Future.

NOTE 7—DISAGGREGATION OF REVENUES

The Company’s revenues are disaggregated based on revenue type, including (i) patient care services related to medical evaluation and treatment, (ii) product retail sales, and (iii) service affiliate agreements.

The Company’s net revenues for the years ended December 31, 2025 and 2024 are disaggregated as follows:

NOTE 8—LEASES

Operating Leases

The Company leases medical clinic and corporate office facilities under operating lease arrangements with remaining lease terms ranging from approximately one to seven years. Certain leases include renewal options that may be exercised at the Company’s discretion. The Company’s leases do not include material residual value guarantees or restrictive covenants.

The following was included in the balance sheets at December 31, 2025 and 2024:

The components of net lease expense consisted of the following for the years ended December 31, 2025 and 2024:

Operating lease right-of-use assets is included within “Other non-current assets” on the accompanying consolidated balance sheets. Cash payments included in the measurement of operating lease liabilities were $166,320 and $149,029 for the years ended December 31, 2025 and 2024, respectively. The decrease in respective periods was primarily due to the closing of redundant office locations.

Estimated future minimum payments of operating leases for the next five years consists of the following at December 31, 2025:

Finance Leases

On April 22, 2024, the Company entered into an equipment financing lease to purchase medical equipment for $10,976, which matures in July 2029. The Company paid off the equipment financing lease in 2025.

The following was included in the balance sheets at December 31, 2025 and 2024:

NOTE 9—DEBT

Promissory Note

On May 12, 2025, the Company entered into a non-interest bearing promissory note in favor of BTC Inc with a principal amount up to $1,750,000 (the “BTC Note”). Pursuant to the terms of the BTC Note, BTC Inc could make advances to the Company in an aggregate principal amount not to exceed $1,750,000, with individual advances capped at $350,000 in any calendar month. The BTC Note matured on the Closing Date. The Company did not draw any proceeds against the BTC Note and the BTC Note was terminated on August 14, 2025.

Convertible Debenture

On May 12, 2025, and in conjunction with the Merger with Nakamoto Holdings, see Note 3, the Company entered into the Debenture Purchase Agreement with the Convert Investor, under which, the Company agreed to sell and issue to the Convert Investor the Convertible Debenture in the aggregate principal amount of $200 million in exchange for cash or Bitcoin equal to 96.0% of the Principal Amount (the “Debt Financing”). The aggregate financing costs included, resulted in a debt discount of $8,150,000.

The Convertible Debenture had an interest rate of 0.0% per annum for the first two years, and 6.0% per annum for the third year and was payable on the third-year anniversary of the issuance date or earlier redemption. The interest rate would increase to a rate of 18.0% per annum upon the occurrence and during the continuance of an event of default. The Convertible Debenture was secured by Bitcoin having a value of not less than $400 million within 10 business days following the Merger. The Bitcoin serving as collateral for the obligations under the Convertible Debenture was at all times to be held by a special purpose “digital asset subsidiary” that fully guaranteed the obligations of the Company under the Convertible Debenture.

The Convert Investor could convert all or any portion of the principal amount of the Convertible Debenture, together with any accrued and unpaid interest, at an initial conversion rate of $2.80, which was subject to a one-time down round only reset. The Convert Investor was not permitted to convert the Convertible Debenture to the extent that the shares of Common Stock issuable upon conversion of the Convertible Debenture would exceed 19.99% of the Company’s outstanding shares immediately prior to executing the Debenture Purchase Agreement without prior stockholder approval.

The Company had the right to redeem the Convertible Debenture if(i) the volume-weighted average price of the Common Stock is less than the Fixed Price (as defined in the Convertible Debenture) and it provides the Convert Investor at least ten (10) trading days’ notice, or (ii) the volume-weighted average price of the Common Stock is equal to or greater than $4.50 and it provides the Convert Investor at least thirty (30) trading days’ notice, and in each case, at a redemption price equal to 101.5% of the principal amount redeemed plus accrued and unpaid interest thereon if redeemed within the first twelve (12) months, 103.0% if redeemed between twelve (12) and twenty-four (24) months, and 105.0% if redeemed between twenty-four (24) and third-six (36) months (the “Payment Premium”). Following such notice and prior to the respective redemption, the Convert Investor would have the right to elect to convert all or any portion of the outstanding principal plus all accrued and unpaid interest, plus the Payment Premium.

The Company evaluated the Convertible Debenture for potential embedded derivatives under ASC 815,“Derivatives and Hedging”. The Company concluded that the only potential embedded features were (i) the conversion option and (ii) the Company’s optional redemption provisions. After concluding that the embedded features satisfied the separation criteria in ASC 815-15-25, the Company then assessed the embedded options to determine whether they satisfied the scope exception outlined in ASC 815-40. To that extent, the Company concluded that the embedded features were both indexed to their stock and could be classified in stockholders’ equity. As such, the embedded options were not bifurcated and accounted for separately.

In addition, the Company issued 3,000,000 shares of Common Stock (the “Convert Fee Shares”) to the Convert Investor as payment for the Convert Investor’s fees for entering into that certain Debenture Purchase Agreement. The Convert Fee Shares were issued with a fair value of $1.12 per share, resulting in a debt discount on a relative fair value basis of $3,304,485. The Company recorded $188,545,515 of Convertible Debenture upon issuance, net of debt discount.

The Company executed its option of redemption, effective on September 29, 2025. As of December 31, 2025, the Convertible Debenture was fully repaid and there was no outstanding principal or accrued interest related to the Convertible Debenture.

Naka SPV2 Credit Facility

On September 30, 2025, the Company, through its subsidiary Naka SPV2, LLC, a Delaware limited liability company (“Naka”), entered into a Credit Facility agreement with Two Prime Lending Limited, a limited company existing under the laws of the British Virgin Islands, (the “Naka Credit Facility”), for an aggregate principal amount of $203,017,500. The Naka Credit Facility has an interest rate of 8.5% per annum and matures on September 30, 2026. The Company used proceeds of the Naka Credit Facility to satisfy its obligations in full under its outstanding Convertible Debenture.

Management deemed, under the guidance of ASC 470-50,“Debt-Modifications and Extinguishments”, that the satisfaction of the Convertible Debenture with the funds from the Naka Credit Facility qualified for debt extinguishment accounting. As a result, the Company recorded debt restructuring costs of $13,469,182 in Non-operating income (expense) on the consolidated statements of operations for the year ended December 31, 2025. The outstanding amount under the Naka Credit Facility was reduced to $0 with proceeds from a loan entered into on October 6, 2025 (see Loan Agreement below). The Naka Credit Facility is an uncommitted guidance line of credit and will remain open and available to Naka for future borrowings through September 30, 2026.

As of the date of this filing, the Naka Credit Facility remains open and has no principal drawn against it.

Antalpha Loan Agreement

On October 6, 2025, Naka entered into a Master Loan Agreement with Antalpha Digital Pte. Ltd. a private company organized under the laws of Singapore (“Holder”) (such Master Loan Agreement being referred to as, the “Loan Agreement”). The Holder extending a term loan facility in an aggregate principal amount of 206,000,000 USDT (the “Loan”), bearing interest of 7.0% per annum.

The Loan had an initial maturity date of November 6, 2025, subject to an optional maturity date extension of an additional 30 days at the election of Naka. Naka elected to extend the maturity date to December 6, 2025. The obligations under the Loan Agreement were secured solely by Bitcoin or other digital assets agreed to by Naka and Holder, and were subject to customary affirmative and negative covenants, loan-to-value requirements, representations and warranties, and events of default. The collateral for the Loan was held by Holder.

Naka used the proceeds of the Loan to satisfy its existing obligations in full under that certain Naka Credit Facility, between the Company and Holder and for expenses incurred in connection with the Loan Agreement. As of December 31, 2025, the Loan was fully repaid and there was no outstanding principal or accrued interest related to the Loan.

Kraken Loan Agreement

On December 3, 2025, the Company, through its subsidiary Nakamoto Holdings, entered into a Master Loan Agreement with Payward Interactive, Inc., a Florida corporation, doing business as Kraken (“Kraken”) (the “Kraken Loan Agreement”), pursuant to which Nakamoto Holdings may, from time to time, borrow fiat or digital currencies on the terms set forth therein and in the related loan term sheets entered into thereunder. The Kraken Loan Agreement contains customary conditions, initial collateral requirements, collateral maintenance and liquidation mechanics, and early return and recall rights. The obligations under the Kraken Loan Agreement are prepayable at the option of Nakamoto Holdings, provided that, prepayments made prior to the six-month anniversary of the initial funding date shall be subject to a make-whole payment for such six-month period.

On December 4, 2025, Nakamoto Holdings and Kraken executed an initial term sheet (the “Initial Term Sheet”) under the Kraken Loan Agreement or a fixed-term loan of 93,000,000 USDT bearing a fee of 8.00% per annum, maturing on December 4, 2026 (the “Initial Loan”). On December 9, 2025, Nakamoto and Kraken executed a second term sheet (the “Second Term Sheet”) for a fixed-term loan of 210,000,000 USDT, which amount includes the Initial Loan balance (the “Kraken Loan”), bearing a fee of 8.00% per annum, maturing on December 4, 2026. The Second Term Sheet amends and supersedes the Initial Term Sheet in its entirety and confirms that the Initial Loan was deemed repaid and subsequently transferred to Nakamoto Holdings pursuant to the Second Term Sheet. The Kraken Loan is secured solely by 3,717 Bitcoin (the “Kraken Collateral”) as of December 31, 2025. On February 5, 2026, the Company pledged an additional 688 Bitcoin to Kraken to meet ongoing collateral maintenance requirements.

Nakamoto Holdings used the proceeds of the Kraken Loan to satisfy its existing obligations in full under that certain Loan with Antalpha Digital Pte. Ltd., dated as of October 6, 2025. Management deemed, under the guidance of ASC 470-50,“Debt-Modifications and Extinguishments”, that the satisfaction of the Loan with the funds from the Kraken Loan, qualified for debt extinguishment accounting. As a result, the Company recorded debt restructuring costs of $1,253,449 in Non-operating income (expense) on the consolidated statements of operations for the year ended December 31, 2025.

The Company classifies USDT as a nonfinancial intangible digital asset in accordance with ASC 350-60. Due to the Kraken Loan being denominated and repayable in USDT, it contains an embedded derivative representing the Company’s exposure to changes in the USDT/USD exchange rate. The Company evaluated the embedded derivative under ASC 815-15-25-1 and determined that all three bifurcation criteria are met for the USDT settlement feature. However, because USDT traded at $1.00 on both funding dates, the fair value of the embedded derivative was $0 at inception. The Company assessed the materiality of the embedded derivative at inception and at December 31, 2025, and concluded that its effect is not material to the consolidated financial statements. Accordingly, the embedded derivative is not presented as a separate line item on the balance sheet; the carrying value of the Kraken Loan is presented on a net basis reflecting the cumulative remeasurement of the embedded derivative.

The Kraken Loan was initially recognized at $210,000,000, representing the USD-equivalent of 210,000,000 USDT received at the prevailing exchange rate of $1.00 on the funding date. The host debt contract is carried at historical cost. The embedded derivative is remeasured at fair value at each reporting date under ASC 815, with changes in fair value recognized in Other income, net on the consolidated statement of operations. At December 31, 2025, the USDT/USD exchange rate was $0.99827, resulting in an unrealized gain of $363,300. The net carrying value, inclusive of unamortized debt issuance costs of $79,086, of the Kraken Loan on the consolidated balance sheet at December 31, 2025, was $209,557,614.

Prepayments made prior to June 4, 2026, are subject to a make-whole payment equal to the interest that would have accrued from the prepayment date through June 4, 2026. No prepayment penalty applies after June 4, 2026.

Other Loans Payable

On December 25, 2023, the Company entered into a loan agreement with a third-party in the amount of $79,975 for total cash proceeds of $70,000. The loan matured on June 25, 2025. The Company recorded a debt discount of $9,975, which was amortized under the effective interest method at an effective interest rate of 25.6%. As of December 31, 2025, the outstanding principal balance of the loan payable was paid in full.

On December 26, 2023, the Company entered into a loan agreement with a third-party in the amount of $285,573 for total cash proceeds of $249,300. The loan matured on June 26, 2025. The Company recorded a debt discount of $36,273, which was amortized under the effective interest method at an effective interest rate of 15.0%. As of December 31, 2025, the outstanding principal balance of the loan payable paid in full.

NOTE 10—STOCKHOLDERS’ EQUITY

Preferred Stock

As of December 31, 2025 and 2024, the Company was authorized to issue 10,000,000 preferred shares. As of December 31, 2025 and 2024, the Company hadno preferred shares issued and outstanding.

Common Stock

On May 20, 2025, the board of directors of the Company and a majority of the stockholders of the Company approved the Second Amended and Restated Articles of Incorporation (the “Amended Articles”), which became effective upon filing with the Utah Division of Corporations on August 11, 2025. The Amended Articles increase the authorized shares of Common Stock to 10,000,000,000, from 100,000,000, among other changes.

As of December 31, 2025 and 2024, the Company was authorized to issue 10,000,000,000 and 100,000,000 common shares, respectively. As of December 31, 2025, the Company had 439,950,632 and 437,946,327 shares of Common Stock issued and outstanding, respectively. As of December 31, 2024, the Company had 6,050,148 and 6,029,648 common shares issued and outstanding, respectively. At December 31, 2025, the Company had 71,704,975 pre-funded warrants to purchase shares of common stock remaining unexercised (see Note 3) and for a description of the terms of the Pre-Funded Warrants see the Warrants section below. The shares underlying the unexercised Pre-Funded Warrants are included in the computation of basic and diluted earnings per share due to their nominal exercise price and unconditional right to receive shares upon exercise.

During the years ended December 31, 2025 and 2024, the Company issued shares of common stock in connection with various transactions, including its merger with Nakamoto Holdings (see Note 3), PIPE Financings (see Note 3), the acquisition of intangible assets, the initial public offering (see below), and stock-based compensation agreements (see Note 11). See the Warrants and At-the-Market Offerings sections below for additional detail on shares issued in connection with warrant exercises and the ATM program.

Initial Public Offering

On May 31, 2024, the Company entered into an underwriting agreement with WallachBeth Capital, LLC, as representative (the “Representative”) of the underwriters in connection with the initial public offering for sale of an aggregate of 1,240,910 units at a price to the public of $5.50 per share. Each unit offered under the underwriting agreement consisted of one share of common stock, one tradeable warrant to purchase one share of common stock with an exercise price of $6.33 and afive-year exercise term; and one non-tradeable warrant to purchase one-half of one share of common stock with an exercise price of $6.33 and afive-year exercise term.

The underwriting agreement also provided for the issuance of 83,639 warrants to the Representative with an exercise price of $6.33 and afive-year exercise term.

In addition, the underwriters partially exercised its over-allotment option, resulting in the issuance of 76,538 tradeable warrants and 76,538 non-tradeable warrants.

On June 3, 2024, the IPO was completed, resulting in the issuance of 1,240,910 units. As a result of the IPO, the Company received gross proceeds of approximately $6.8 million before deducting underwriting discounts and offering expenses. After deducting these and other offering expenses, the Company received net proceeds of approximately $5.9 million.

On June 3, 2024, in accordance with the terms of the 10% OID promissory note agreements, the Company issued each note holder common stock equal to the principal amount of the notes at the IPO price of $5.50 per share, totalling 80,808 shares of restricted common stock, with a fair value of $214,949 or $2.66 per share. These shares are subject to a 90-day lock-up agreement from the date of issuance.

The common stock and tradeable warrants are trading on the Nasdaq Global Market, under the symbols “NAKA” and “NAKAW,” respectively.

At-The-Market Offering

On August 26, 2025, the Company entered into a Sales Agreement (the “Sales Agreement”) with TD Securities (USA) LLC; Cantor Fitzgerald & Co.; B. Riley Securities, Inc.; The Benchmark Company, LLC; Canaccord Genuity LLC; Cohen & Company Capital Markets (a division of Cohen & Company Securities, LLC); Craig-Hallum Capital Group LLC; Needham & Company, LLC; and Yorkville Securities, LLC (each, an “Agent” and collectively, the “Agents”).

Pursuant to the Sales Agreement, the Company may, at its option and from time to time, offer and sell shares of its Common Stock, through the Agents having an aggregate gross sales price of up to $5,000,000,000.

For the year ended December 31, 2025, the Company sold 1,362,340 shares of Common Stock at an average price of $4.15 per share, for aggregate cash proceeds of $5,659,975, net of issuance costs.

Treasury Stock

As of December 31, 2025, the Company held 2,004,305 shares in treasury at a total cost of $749,003 and as of December 31, 2024, held 20,500 shares in treasury at a total cost of $22,145.

Warrants

The Company has issued warrants to purchase shares of common stock in connection with its initial public offering (see above) and PIPE financing (see Note 3). All warrants are classified as equity.

As of December 31, 2025, the Company has 72,293,476 warrants outstanding with the following terms:

Shares Issued Upon Warrant Exercise During 2025

Total cash proceeds from warrant exercises during 2025 were $9,216,534.

Settlement Terms

Warrant holders control all settlement methods. Warrants may be settled through:

The maximum shares that could be issued upon exercise of all outstanding warrants is 72,191,693 shares. Fewer shares may be issued if cashless exercise is elected.

NOTE 11—STOCK-BASED COMPENSATION

Share Option Plan

The Company’s equity incentive plans (the “2022 Plan” and the “2025 Plan”), which are shareholder approved, provides for the grant of incentive stock options (“ISOs”), nonqualified stock options (“NQSOs”), restricted stock awards (“RSAs”), stock awards, and performance shares to employees, officers, directors, and consultants of the Company and its affiliates.

The 2022 Plan initially authorized 150,000 shares of common stock for issuance, with an automatic increase on April 1 st of each calendar year (from 2022 through 2031) equal to the lesser of (i)4% of the total shares of common stock outstanding on the last day of the immediately preceding fiscal year, or (ii) a smaller number of shares as determined by the administrator. As of December 31, 2025,431,216 shares remain available for future grants under the 2022 Plan.

The 2025 Plan initially authorized 37,611,971 shares of common stock for issuance, with a potential increase on January 1 st of each calendar year equal to 5% of the outstanding shares on December 31 st of the prior year, provided, that the Board or Compensation Committee of the Board may, in its discretion, reduce the amount by which the plan increases. As of December 31, 2025,21,856,173 shares remain available for future grants under the 2025 Plan.

Stock Option Awards

Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those options are determined by the Administrator and specified in the individual award agreements; generally have a contractual term of 10 years (5 years for ISOs granted to 10% stockholders); and are generally able to be terminated 3 -12 months after the termination of service.

The fair value of each option is estimated on the date of grant using the Black-Scholes option valuation model that uses assumptions in the following tables. Because Black-Scholes option valuation models incorporate ranges of assumptions for inputs, these ranges are disclosed. Expected volatilities are primarily based on historical volatilities of peer group companies as the Company has limited history as a public company. The Company uses the simplified approach to estimate option exercise term. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

In applying the Black-Scholes option pricing model to the options issued, the Company used the following assumptions:

Below is a table summarizing the changes in stock options outstanding during the years ended December 31, 2025 and 2024:

The weighted average grant date fair value of options granted during the years ended December 31, 2025 and 2024 was $3.71 and $1.17, respectively. The total intrinsic value of options exercised during the years ended December 31, 2025 and 2024 was $0 and $0, respectively.

Stock-based compensation expense for options of $569,818 and $105,817 was recorded during the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, the remaining unrecognized compensation cost related to non-vested options is $419,725.

As of December 31, 2025, the outstanding stock options have a weighted average remaining contractual life of 7.7 years and a total intrinsic value of $0.

Restricted Stock Awards

During 2025, the Company granted 15,898,579 restricted stock awards to employees and directors with various vesting terms ranging from immediate vesting to vesting over four years. The weighted-average grant date fair value was $1.08 per share, determined by the Company’s closing stock price on the respective grant dates.

A summary of the status of the Company’s nonvested restricted stock awards as of December 31, 2025, and changes during the year then ended is presented below:

The total fair value of restricted stock awards that vested during the year ended December 31, 2025 was $189,058.

During 2025, the Company recognized stock-based compensation expense of $1,789,105 related to RSAs. As of December 31, 2025, unrecognized compensation cost was $15,186,700 expected to be recognized over a weighted-average period of 3.0 years.

NOTE 12—FAIR VALUE MEASUREMENTS

Fair value measurements discussed herein represent management’s best estimate of fair value as of and during the year ended December 31, 2025.

Equity Securities – Metaplanet, Inc. The Company measures its investment in Metaplanet, Inc. at fair value on a recurring basis. The fair value of the Metaplanet Stock is based on quoted market prices on the Tokyo Stock Exchange, translated into U.S. dollars using the spot exchange rate at the balance sheet date. Due to the fair value being derived from observable and unadjusted quoted prices in active markets for identical assets, the measurement is classified as a Level 1 input in the fair value hierarchy.

Digital Assets. The Company holds digital assets, primarily Bitcoin, which are measured at fair value on a recurring basis in accordance with ASC 350-60. The fair value of the Company’s digital assets is determined using quoted prices on Anchorage Digital, the Company’s principal digital asset platform. Due to the fair value being derived from observable and unadjusted quoted prices in active markets for identical assets, the measurement is classified within Level 1 of the fair value hierarchy.

Call Option – Related Party. The call option asset represents the Company’s right to acquire an equity interest in BTC Media (see Note 3). The fair value of the call option asset is measured using a correlated Monte Carlo simulation model, which incorporates significant unobservable inputs, including management’s estimates regarding expected cash flows, probability of exercise, equity volatility for BTC Inc and the Company’s common stock, expected term, risk-free rate, discount for lack of marketability, correlation coefficient, and other assumptions that market participants would use in pricing the obligation. Due to the valuation relying on unobservable inputs, the asset is classified within Level 3 of the fair value hierarchy. Generally, increases in equity volatility or correlation coefficient would result in a higher fair value of the asset, whereas increases in discount for lack of marketability would result in a lower fair value.

The following tables present the Company’s assets measured at fair value on a recurring basis as of December 31, 2025:

There were no transfers between Level 1, Level 2, or Level 3 during the periods presented.

The following table presents the changes in Level 3 assets measured at fair value for the year ended December 31, 2025:

The call option was initially recognized as a liability at fair value on August 14, 2025. During the year ended December 31, 2025, the fair value of the call option increased significantly due primarily to a significant decrease in the fair value of the Company’s common stock, resulting in the instrument transitioning from a liability position at inception to an asset position of $199,060,000 at December 31, 2025. The total change in fair value for the year ended December 31, 2025, was a gain on $226,374,000, reported in Change in fair value of call option - related party in the consolidated statements of operations.

The following table presents quantitative information about the significant unobservable inputs used in the Company’s Level 3 fair value measurements as of December 31, 2025:

NOTE 13—INCOME TAXES

As of December 31, 2025 and 2024, the Company had net operating loss carry forwards of $48,059,205 and $4,615,303, respectively, that may be available to reduce future years’ taxable income. As of December 31, 2025, the Company has a net deferred tax asset of $13,964,902.

Deferred income tax assets and liabilities at December 31, 2025 and 2024, consisted of the following temporary differences and carry-forward items:

The components for the income tax expense:

The valuation allowance roll forward as of December 31 is as follows:

The schedule of effective tax rate reconciliation is as follows:

Digital assets, in general are treated as property for U.S. Federal income tax purposes. However, the Company recognizes that digital assets can be tokenized in which case the underlying asset being tokenized would govern the tax treatment. As such, the Company generally does not recognize tax impacts on the unrealized gain or losses from digital assets. The Company generally incurs tax impacts when digital assets are sold or exchanged.

Cash paid for income taxes, net of refunds, was $0 and $0 for the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025 and 2024, the Company hadno unrecognized tax benefits and did not have any accrued interest or penalties related to uncertain tax positions. The Company does not anticipate any significant changes to its unrecognized tax benefits within the next twelve months. The valuation allowance represents the portion of our deferred tax assets for which it is more likely than not that the benefit of such items will not be realized.

The Company files income tax returns in the U.S. federal jurisdiction and the state of Utah. The Company’s tax years 2022 to current year remain open to examination by the major taxing authorities.

NOTE 14—RELATED PARTY TRANSACTIONS

As described in Note 3, the Company acquired Nakamoto Holdings during August of 2025. As part of the acquisition, the Company assumed a BTC Media Agreement, which included both a i) call option to acquire the outstanding shares of BTC Inc and ii) a corresponding put option allowing BTC Inc to sell all of their outstanding shares to Nakamoto based on a to be determined amount of issued Nakamoto common shares (i.e. “the call consideration amount”). The Company determined that BTC Inc should be considered a related party as David Bailey, Nakamoto’s Chief Executive Officer and Chairman of the Board and Tyler Evans, Nakamoto’s Chief Investment Officer, are also a director of the board and chief executive officer and chief investment officer of BTC Inc, respectively, and therefore have significant influence over that entity. To comply with the requirements of Rule 4-08(k) of Regulation S-X and ASC 850, the Company has presented both the put option liability and change in put option liability as related party amounts in its consolidated financial statements as of and for the year ended December 31, 2025.

During 2025, the Company incurred approximately $1,263,906 included in General and administrative expenses in the Consolidated Statements of Income with BTC Inc under a marketing and services agreement in which BTC Inc provides marketing and other administrative support. As of December 31, 2025, $570,152 was owed to BTC Inc.

NOTE 15—SEGMENT INFORMATION

The Company operatestwo reportable segments: Bitcoin Operations and Healthcare Operations.

Prior to 2025, the Company operated as a single reportable segment of Healthcare Operations. In 2025, following the Merger (see Note 3), the Company established the Bitcoin Operations segment. The Company now evaluates performance based on these two reportable segments, with corporate overhead reported separately as Other.

The Company evaluates segment performance based on operating income (loss) which represents revenues less operating expenses attributable to each segment.

The following tables represent our results by segment information for the year ended December 31, 2025:

The following tables represent segment information for the year ended December 31, 2024:

The following table represents assets by segment as of December 31, 2025 and 2024:

NOTE 16—SUBSEQUENT EVENTS

Acquisitions of BTC Inc and UTXO Management GP, LLC

On February 16, 2026, the Company entered into (i) an Agreement and Plan of Merger (the “BTC Merger Agreement”) with BTC Inc., a Delaware corporation, and (ii) an Agreement and Plan of Merger (the “UTXO Merger Agreement”) with UTXO Management GP, LLC, a Tennessee limited liability company (“UTXO”). On February 20, 2026, the Company completed both mergers (together, the “Mergers”).

BTC Inc Merger. Pursuant to the BTC Merger Agreement, BTC Inc became a wholly-owned subsidiary of the Company. At closing, all outstanding shares of BTC Inc common stock and preferred stock were converted into the right to receive an aggregate of 259,886,237 shares of the Company’s Common Stock. Additionally, the Company reserved 78,427,012 shares of Common Stock for issuance in connection with fully-vested BTC Inc stock options assumed by the Company, which were accelerated and converted at an exchange ratio of 137 shares of Common Stock per share of BTC Inc common stock, with exercise prices adjusted proportionally to preserve the economic value of each option. Of the shares issued as BTC Inc. merger consideration,24,835,418 shares were withheld as holdback shares to support post-closing purchase price adjustments and indemnification obligations. Based on the closing price of the Company’s Common Stock of $0.248 on February 19, 2026, the aggregate value of the BTC Inc merger consideration, net of aggregate option exercise prices, was approximately $75.1 million.

UTXO Merger. Pursuant to the UTXO Merger Agreement, UTXO became a wholly-owned subsidiary of the Company. At closing, all outstanding equity interests of UTXO were converted into the right to receive an aggregate of 26,481,860 shares of the Company’s Common Stock, of which 2,648,186 shares were withheld as holdback shares to support post-closing purchase price adjustments and indemnification obligations. Based on the closing price of the Company’s Common Stock of $0.248 on February 19, 2026, the aggregate value of the UTXO merger consideration was approximately $6.6 million.

The Company is in the process of completing its preliminary purchase price allocation for both acquisitions. As the Mergers closed subsequent to the balance sheet date, the initial accounting for these business combinations, including the fair value of assets acquired and liabilities assumed, had not been finalized as of the date these financial statements were issued.

Sale of Metaplanet Stock

In Q1 2026, the Company sold 5,000,000 shares of its Metaplanet stock for approximately $11.1 million.

Sale of Bitcoin

In March 2026, the Company sold approximately 284 Bitcoin for $20 million.