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STREAMEX CORP.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2025 (Unaudited)
thousand due to related parties, compared to $ thousand as of December 31, 2024. These amounts primarily relate to executives and board compensation, severance, and reimbursements. Included in the due from related party balance as of September 30, 2025 is $ thousand due from Henry McPhie, the Company’s new Chief Executive Officer and Board of Directors.
During the nine months ended September 30, 2025, the Company issued an aggregate of shares of its common stock to Mr. Groenewald, the Interim Chief Financial Officer, with a total grant-date fair value of $ million
During the nine months ended September 30, 2025, the Company issued shares of its common stock to Mr. Amato, the Chief Executive Officer, with an aggregate grant date fair value of $ million. The issuances were primarily made in connection with Mr. Amato’s resignation pursuant to the terms of the Purchase Agreement dated May 23, 2025, and the First Amendment to his Executive Employment Agreement. Under the amendment, all previously granted equity awards — including vested and unvested stock options, RSUs, PSUs, and other equity-based awards — were accelerated and deemed fully vested and nonforfeitable as of the Effective Date of the transaction. This treatment was contractually agreed upon as part of the severance provisions associated with Mr. Amato’s resignation in connection with the Company’s acquisition of Streamex Exchange Corporation.
million of aggregate proceeds from the first and second closings be allocated to purchase Allocated Vaulted Gold Bullion as collateral, consisting of:
| ◌ | $ million at the first closing, and |
| ◌ | $ million at the second closing. |
| ● | Confirming formation of special purpose entities for collateral arrangements. |
| ● | Updating closing conditions and related security documentation requirements. |
The amendment did not change the aggregate commitment of up to $ million in secured convertible debentures but modified certain mechanics for funding and collateral compliance.
On November 4, 2025, the Company entered into Amendment No. 3 to its Secured Convertible Debenture Purchase Agreement with Yorkville, further updating closing conditions and related documentation requirements. No material economic terms were amended.
On the same date (the “First Closing Date”), the Company issued a secured convertible debenture to Yorkville in the principal amount of $ (the “First Convertible Debenture”). The First Convertible Debenture matures on , accrues interest at % per annum (increasing to 18.00% upon an event of default), and is payable in cash at maturity or earlier upon acceleration or conversion. Interest may be paid in cash or, at the Company’s election, in kind through the issuance of common stock upon conversion.
The conversion price is the lower of (i) $ per share (125% of the VWAP on November 3, 2025), subject to a one-time downward-only reset based on the average VWAP over the 30 trading days following effectiveness of the resale registration statement, and (ii) 97.0% of the lowest daily VWAP during the three trading days prior to conversion, subject to a floor price of $ per share. The debenture includes customary anti-dilution adjustments.
Gross proceeds from the First Convertible Debenture were approximately $, representing 96.0% of the principal amount. The Company allocated $ million of the proceeds toward the purchase of Allocated Vaulted Gold Bullion as collateral, in accordance with Amendment No. 2 to the agreement.
The Company may prepay the First Convertible Debenture prior to maturity, subject to a 10% premium and a ten-trading-day notice period during which the holder retains conversion rights. The debenture includes customary covenants, default provisions, and rights of the holder, including restrictions on beneficial ownership exceeding 4.99% of outstanding common stock post-conversion.
Yorkville may purchase a second $ debenture upon satisfaction of specified conditions and may purchase additional debentures up to $ upon mutual agreement. In connection with the first closing on November 4, 2025, the company also entered into a U.S. guaranty agreement, a Canadian guarantee, and a registration rights agreement with Yorkville. Pursuant to the registration rights agreement, the company agreed to register for resale, under the Securities Act of 1933, as amended, the shares of common stock issuable upon conversion of the first convertible debenture.
Shareholder Approval for Streamex Exchange Proposal
On November 4, 2025, the Company reconvened its Special Meeting of stockholders, which had been partially adjourned solely with respect to Proposal 1 (the “Acquisition Proposal”). Stockholders approved the issuance of approximately shares of Common Stock, subject to adjustment, and one share of Special Voting Preferred Stock pursuant to the Share Purchase Agreement dated May 23, 2025, as amended, among the Company, its subsidiaries, Streamex Exchange, and its shareholders.
As a result, the conversion cap on the Exchangeable Shares issued in connection with the acquisition was removed, enabling holders to convert into Common Stock. The related derivative liability was reclassified to permanent equity as of the approval date. Following this reclassification, the Company’s stockholders’ equity increased above the minimum stockholders’ equity requirement for continued listing on The Nasdaq Capital Market.
Equity transactions
In October 2025, the Company granted an aggregate of shares of its common stock in lieu of cash for services to key consultants under the Company’s 2023 Long Term Incentive Plan at a value of $.
In November 2025, the Company granted shares of its common stock in lieu of cash for services to a key consultant under the Company’s 2023 Long Term Incentive Plan at a value of $.
On October 6, 2025, the Company granted restricted stock units to a key consultant under the Company’s 2023 Long Term Incentive Plan in lieu of cash for services. Of these units, 50% () vested on the grant date, and the remaining 50% () are scheduled to vest two months from the grant date. The granted on October 6, 2025 had a value of $.
On October 6, 2025, the Company granted restricted stock units to a key consultant under the Company’s 2023 Long Term Incentive Plan in lieu of cash for services. Of these units, 50% () vested on the grant date, and the remaining 50% () are scheduled to vest three months from the grant date. The granted on October 6, 2025 had a value of $.
On October 1, 2025, the Company granted an aggregate of restricted stock units vesting over three years from the date of grant in equal quarterly installments in lieu of cash for services to key consultants under the Company’s 2023 Long Term Incentive Plan.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management’s Discussion and Analysis of Financial Condition and Results of Operations includes a number of forward-looking statements that reflect Management’s current views with respect to future events and financial performance. You can identify these statements by forward-looking words such as “may,” “will,” “expect,” “anticipate,” “believe,” “estimate” and “continue,” or similar words. Those statements include statements regarding the intent, belief or current expectations of us and members of our management team as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risk and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements.
Readers are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the Securities and Exchange Commission. Important factors currently known to Management could cause actual results to differ materially from those in forward-looking statements. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in the future operating results over time. We believe that our assumptions are based upon reasonable data derived from and known about our business and operations. No assurances are made that actual results of operations or the results of our future activities will not differ materially from our assumptions. Factors that could cause differences include, but are not limited to, expected market demand for our products, fluctuations in pricing for materials, and competition.
Business Overview
On May 28, 2025, Streamex Corp. completed its acquisition of Streamex Exchange. The financial results for the three months ended September 30, 2025 include the full activity of Streamex Corp. and all of its wholly and majority-owned subsidiaries, including Streamex Exchange, which has been fully consolidated since the acquisition date. Accordingly, the consolidated financial statements for the third quarter reflect the complete operations of Streamex Exchange for the entire three-month period.
The Company has expanded from its historical focus as a medical device technology company to a diversified technology platform. Historically, the Company developed and commercialized advanced digital signal processing solutions for electrophysiology, including its flagship PURE EP™ Platform (“PURE EP™”), designed to deliver real-time, high-fidelity cardiac signal data to electrophysiologists during ablation procedures for the treatment of cardiovascular arrhythmias. PURE EP™ enables the acquisition of raw intracardiac signals with minimal noise and interference, supporting improved procedural outcomes and clinical decision-making. By preserving the integrity of complex cardiac signals, PURE EP™ is intended to enhance workflow efficiency and support the treatment of challenging arrhythmias, including ventricular tachycardia (VT) and atrial fibrillation (AF).
In recent quarters, the Company has expanded its strategic focus from commercial hardware distribution to the research and development of proprietary software algorithms. These algorithms aim to advance the understanding of cardiac tissue characteristics and ablation mechanisms. Data collection efforts began in December 2023 and remain ongoing. A key area of focus is improving the specificity and long-term outcomes of pulsed field ablation (PFA), a rapidly adopted technique in electrophysiology.
As of September 30, 2025, the Company’s intellectual property portfolio includes:
| ● | 41 issued or allowed utility patents, of which 29 list the Company as at least one of the applicants; | |
| ● | 31 pending U.S. and foreign utility patent applications, jointly or solely filed by the Company and Mayo Foundation for Medical Education and Research (“Mayo”); | |
| ● | 1 issued U.S. patent and 1 pending U.S. application related to artificial intelligence (AI); | |
| ● | 30 issued worldwide design patents, covering display screens and graphical user interfaces for biomedical signal visualization; | |
| ● | 12 issued/allowed patents and 9 pending applications licensed from Mayo, primarily directed to electroporation and stimulation technologies. |
Through the acquisition of Streamex Exchange, the Company has expanded its strategic focus to include digital infrastructure for the tokenization and exchange of real-world assets (“RWAs”), with an initial emphasis on gold-backed financial products. Streamex Exchange is developing a blockchain-based platform designed to facilitate the compliant issuance, trading, and custody of tokenized commodities and structured digital securities. As of the reporting date, Streamex Exchange remains in the development stage and is pre-revenue. The Company is actively building out the platform’s architecture, regulatory framework, and strategic partnerships. Revenue-generating activities are expected to commence upon the launch of Streamex Exchange’s tokenized gold financing product, which is currently under development.
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Results of Operations (000’s)
We anticipate that our results of operations will fluctuate for the foreseeable future due to several factors, such as the progress of our research and development and commercialization efforts, the timing and outcome of future regulatory submissions, and other macroeconomic and operational uncertainties. Due to these uncertainties, accurate predictions of future operations are difficult or impossible to make.
Three Months Ended September 30, 2025 Compared to Three Months September 30, 2024 (000’s)
Revenues and Cost of Goods Sold. Revenue for the three months ended September 30, 2025 and 2024 was $0 and $0, respectively, and comprised of recognized service revenue.
We derive our revenue primarily from the sale of our medical device, PURE EP™ Platform, as well as related support and maintenance services and software upgrades in connection with the device.
Research and Development Expenses. Research and development expenses for the three months ended September 30, 2025 were $6, a decrease of $150, or 96%, from $156 for the three months ended September 30, 2024. The decrease is primarily attributable to reductions in payroll, Data/AI development, and clinical research and design activities. These reductions were the result of a temporary reallocation of internal resources during the quarter, as the Company focused on supporting the Streamex Exchange acquisition. Research and development programs remained active but operated at reduced levels while management and technical teams engaged in due diligence, integration planning, and related activities. The Company expects research and development activity to resume at normalized levels in future periods.
Research and development expenses were comprised of the following:
Three months ended:
| September 30, 2025 | September 30, 2024 | |||||||
| Salaries and equity compensation | $ | - | $ | 105 | ||||
| Research and clinical studies and design work | 6 | 34 | ||||||
| Regulatory | - | 1 | ||||||
| Travel, supplies, other | - | 16 | ||||||
| Total | $ | 6 | $ | 156 | ||||
General and Administrative Expenses. General and administrative expenses for the three months ended September 30, 2025 were $4,619, an increase of $1,856 or 67%, from $2,763 incurred in the three months ended September 30, 2024. The increase was primarily driven by higher professional fees and consulting costs associated with the Streamex Exchange acquisition and related integration activities. Accounting fees rose by approximately $292 for audit and compliance support. Shareholder relations costs also increased by $418, mainly due to board fees and higher investor relations and public relations spending. Marketing expenses of approximately $579 were incurred in the current period compared to none in the prior period, as the Company launched initiatives to enhance brand visibility. Payroll and related costs increased by approximately $429, primarily due to expanded corporate staffing and executive compensation, and directors’ and officers’ insurance premiums. Legal fees increased by approximately $596, due to the acquisition with Streamex Exchange Corp. and expanding of the operations under Streamex Exchange Corp. These increases were partially offset by lower patent-related costs compared to the prior period. Overall, the increase reflects the Company’s strategic focus on completing the Streamex Exchange acquisition and positioning for future growth.
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Depreciation and Amortization Expense. Depreciation and amortization expense for the three months ended September 30, 2025 totaled $1,488, an increase of $1,457, or 4700%, over the expense of $31 incurred in the three months ended September 30, 2024, as a direct result of the amortization of the intangible assets recognized from the acquisition of Streamex Exchange. The Company’s intangible assets primarily consist of trade name, developed technology, legal and compliance framework, and patents.
Other Income (Expense), net. Other income (expense), net for the three months ended September 30, 2025 totaled $10,236, a decrease in other income of $11,272, over the income of $1,036 incurred in the three months ended September 30, 2024. The decrease was mainly due to the change in fair value related to the derivative liability offset by the gain on settlement and extinguishment of accounts payable negotiated by management during the prior period.
Income taxes (benefit). For the three months ended September 30, 2025, the Company recorded an income tax benefit of $765,000, compared to $0 in the prior-year periods. The benefit resulted from the reversal of a deferred tax liability associated with the amortization of identifiable intangible assets acquired in the Company’s Canadian subsidiary. The deferred tax liability was recognized during the measurement period as part of the acquisition accounting and reflects a temporary difference due to the non-deductibility of the intangible amortization under Canadian tax law. The benefit recognized in the current period reflects the impact of this measurement period adjustment and was recorded retrospectively as of the acquisition date. No comparable benefit was recorded in the prior-year periods as the acquisition and related tax effects did not exist at that time.
Preferred Stock Dividend. Preferred stock dividend for the three months ended September 30, 2025 and 2024 totaled $2 and $2, respectively. Preferred stock dividends are related to the dividends accrued on our Series C Preferred Stock issued during the period from 2013 through 2015.
Net Loss Attributable to Streamex Corp. Common Stockholders. As a result of the foregoing, net loss attributable to common shareholders for the three months ended September 30, 2025 was $15,586 compared to a net loss of $1,940 for the three months ended September 30, 2024.
Nine Months Ended September 30, 2025 Compared to Nine Months September 30, 2024 (000’s)
Revenues and Cost of Goods Sold. Revenue for the nine months ended September 30, 2025 and 2024 was $0 and $27, respectively, and comprised of recognized service revenue.
We derive our revenue primarily from the sale of our medical device, PURE EP™ Platform, as well as related support and maintenance services and software upgrades in connection with the device.
Research and Development Expenses. Research and development expenses for the nine months ended September 30, 2025 were $31 a decrease of $705, or 96%, from $736 for the nine months ended September 30, 2024. The decrease primarily reflects lower payroll and reduced spend on research, clinical studies, and design work as resources were temporarily reallocated to support the Streamex Exchange acquisition. Management expects research and development activity to normalize in future periods.
Research and development expenses were comprised of the following:
Nine months ended:
| September 30, 2025 | September 30, 2024 | |||||||
| Salaries and equity compensation | $ | - | $ | 469 | ||||
| Consulting expenses | 1 | 120 | ||||||
| Research and clinical studies and design work | 6 | 85 | ||||||
| Regulatory | - | 3 | ||||||
| Travel, supplies, other | 24 | 59 | ||||||
| Total | $ | 31 | $ | 736 | ||||
General and Administrative Expenses. General and administrative expenses for the nine months ended September 30, 2025 were $27,365 an increase of $16,806 or 159%, from $10,559 incurred in the nine months ended September 30, 2024. The increase was primarily driven by higher stock-based compensation and professional fees related to the Streamex Exchange acquisition. Stock-based compensation and common stock issued for services totaled $15,560 in the current period, representing approximately 57% of total general and administrative expenses, compared to $6,804 in the prior period. The increase reflects equity awards issued under the amended executive employment agreement with Mr. Amato and stock grants to third-party consultants in connection with the acquisition. Professional fees and consulting costs increased significantly, with consulting expenses rising to $6,492 from $830, and accounting fees increasing by $311, primarily for transaction support and integration planning. Additional increases were noted in payroll ($1,670 vs $1,248), marketing ($607 vs. $98), shareholder services ($999 vs. $383), legal fees ($975 vs. 556), and D&O insurance premiums ($321 vs. $92), reflecting expanded governance and investor relations activities. These increases were partially offset by lower payroll-related costs compared to the prior-year period. Overall, the increase reflects the Company’s strategic focus on completing the Streamex Exchange acquisition and positioning for future growth.
Impairment of Long Term Assets. For the nine months ended September 30, 2025, the Company determined that no events or changes in circumstances existed that would indicate any impairment of its long-lived assets. During the nine months ended September 30, 2024, the Company re-assessed it’s carrying amounts of certain property and equipment due to reduced manufacturing of its commercial products and determined that these carrying amounts exceeded the estimated undiscounted future cash flows. Accordingly, the Company recorded a $253 impairment charge to current operations.
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Depreciation and Amortization Expense. Depreciation and amortization expense for the nine months ended September 30, 2025 totaled $2,065, an increase of $1,907, or 1207%, over the expense of $158 incurred in the nine months ended September 30, 2024, as a direct result of the amortization of the intangible assets recognized from the acquisition of Streamex Exchange.
Other Income (Expense), Net. Other income (expense), net for the nine months ended September 30, 2025 totaled $10,055, a decrease in other income of $12,494, over the income of $2,439 incurred in the nine months ended September 30, 2024. The decrease was mainly due to the change in fair value related to the derivative liability offset by the gain on settlement and extinguishment of accounts payable negotiated by management during the prior period.
Preferred Stock Dividend. Preferred stock dividend for the nine months ended September 30, 2025 and 2024 totaled $(7) for both periods. Preferred stock dividends are related to the dividends accrued on our Series C Preferred Stock issued during the period from 2013 through 2015. In addition, the Series C Preferred stock conversion rate reset from $2.50 to $0.5302 in during the nine months ended September 30, 2024, therefore we recorded a noncash deemed preferred stock dividend of $157 in the prior period.
Income taxes (benefit). For the nine months ended September 30, 2025, the Company recorded an income tax benefit of $765,000, compared to $0 in the prior-year periods. The benefit resulted from the reversal of a deferred tax liability associated with the amortization of identifiable intangible assets acquired in the Company’s Canadian subsidiary. The deferred tax liability was recognized during the measurement period as part of the acquisition accounting and reflects a temporary difference due to the non-deductibility of the intangible amortization under Canadian tax law. The benefit recognized in the current period reflects the impact of this measurement period adjustment and was recorded retrospectively as of the acquisition date. No comparable benefit was recorded in the prior-year periods as the acquisition and related tax effects did not exist at that time.
Net Loss Attributable to Streamex Corp. Common Stockholders. As a result of the foregoing, net loss attributable to common shareholders for the nine months ended September 30, 2025 was $38,774 compared to a net loss of $9,395 for the nine months ended September 30, 2024.
Liquidity and Capital Resources and Going Concern ($000’s)
As of September 30, 2025, we had a working capital deficit of approximately $111 million and cash of $11.0 million. For the nine months ended September 30, 2025, we used $7.4 million in operating activities, provided $0.2 million from investing activities, and generated $18.1 million from financing activities, primarily from equity offerings including $14.4 million from common stock and warrants and $3.9 million from at-the-market sales.
We have an accumulated deficit of $294.1 million, a net loss attributable to common shareholders of $39.0 million for the nine months ended September 30, 2025, and continued negative cash flows from operations. We do not currently have sufficient cash or committed financing to fund operations for the twelve months following issuance of this Form 10-Q. These conditions raise substantial doubt about our ability to continue as a going concern.
Our financial results for the three months ended September 30, 2025 fully reflect the operations of Streamex Corp. and its wholly and majority-owned subsidiaries, including Streamex Exchange, which was acquired on May 28, 2025, which has been fully consolidated since the acquisition date. Accordingly, the consolidated financial statements for the third quarter reflect the complete operations of Streamex Exchange for the entire three-month period. The acquisition marks a strategic expansion of the Company’s platform beyond its medical device technology to a diversified technology platform. While continuing to advance proprietary software algorithms for cardiac signal analysis and pulsed field ablation research, the Company has broadened its scope to include blockchain-based infrastructure for tokenization and exchange of real-world assets. This expansion builds on the Company’s legacy in digital signal processing, including its PURE EP™ Platform, and reflects a multi-sector technology strategy.
We expect to continue incurring operating losses and negative cash flows until our products—including the PURE EP™ Platform and Streamex Exchange’s blockchain solutions—achieve sustained commercial success. While commercial products are available for sale, revenues have not been significant, and there is no assurance future revenues will be sufficient to fund operations. Streamex Exchange remains in the development stage and is pre-revenue; we expect additional costs for platform development, regulatory compliance, and strategic partnerships before revenue generation begins. Initial revenue is expected upon launch of Streamex Exchange’s tokenized gold financing product, which is currently under development.
Our ability to continue as a going concern is dependent on securing additional financing. We are actively exploring various funding sources, including:
| ● | Public or private equity offerings | |
| ● | Strategic partnerships or licensing arrangements | |
| ● | Government grants or non-dilutive funding | |
| ● | Debt financing, where feasible |
While we previously implemented cost-saving measures to reduce cash burn, we have recently increased spending to accelerate development of the Streamex Exchange platform. These initiatives are expected to support long-term growth but will increase near-term cash requirements. There can be no assurance that we will successfully obtain the additional funding needed to support these activities.
On October 24, 2025, we entered into Amendment No. 2 to our Secured Convertible Debenture Purchase Agreement with YA II PN, Ltd., which provides for up to $100 million in secured convertible debentures, including two initial tranches of $25 million each. The amendment also requires that $25.1 million of proceeds be allocated to purchase Allocated Vaulted Gold Bullion as collateral ($12.6 million at the first closing; $12.5 million at the second closing). Closings remain subject to Nasdaq approval and other conditions, and there can be no assurance these conditions will be satisfied. The first closing occurred on November 4, 2025, resulting in the issuance of a $25 million Convertible Debenture and the allocation of approximately $12.6 million toward the purchase of Allocated Vaulted Gold Bullion.
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Series C Preferred Stock Redemption Risk
Our Series C Preferred Stock includes triggering events that may require redemption at the option of the holders. These include:
| ● | Redemption in cash at the greater of (i) 120% of the $1 stated value or (ii) the product of the variable weighted average price of our common stock and the stated value divided by the then-current conversion price; or | |
| ● | Redemption in common stock, calculated as the redemption amount divided by 75%. |
As of September 30, 2025, the aggregate stated value of our Series C Preferred Stock was $105. Triggering events include, among others, judgments exceeding $100,000 or the initiation of bankruptcy proceedings. If such events occur, we may be required to redeem the Series C Preferred Stock, which could result in a significant liquidity obligation that we may not be able to satisfy. Unpaid redemption amounts accrue interest at a rate of up to 18% per annum or the maximum rate permitted by law.
Future Capital Requirements and Risks
We expect to continue incurring expenses related to:
| ● | Commercialization of the PURE EP™ Platform | |
| ● | Research and development of new product candidates | |
| ● | Clinical trials and regulatory activities | |
| ● | Expansion of business infrastructure and public company compliance | |
| ● | Integration and scaling of Streamex Exchange’s tokenization platform and digital asset infrastructure | |
| ● | Development of real-world asset (RWA) tokenization solutions, including commodities-on-chain initiatives |
Our future capital requirements will depend on several factors, including:
| ● | Progress and results of our R&D programs | |
| ● | Timing and outcome of regulatory approvals | |
| ● | Costs associated with intellectual property protection | |
| ● | Market acceptance and commercialization success | |
| ● | Availability of financing and strategic partnerships | |
| ● | Execution of Streamex Exchange’s growth strategy within the global commodities and digital asset markets | |
| ● | Infrastructure and personnel investments required to support Streamex Exchange’s platform scalability and compliance |
On July 7, 2025, the Company entered into two financing agreements to support its long-term capital needs: (i) a Senior Secured Convertible Debenture Purchase Agreement with YA II PN, Ltd. (“Yorkville”), pursuant to which the Company may issue up to $100 million in convertible debentures, and (ii) a Standby Equity Purchase Agreement (“SEPA”) with Yorkville, allowing the Company to sell up to $1 billion of common stock over a 36-month period.
On August 13, 2025, the Company amended the agreement to revise the structure of the transaction. Under the amended terms, Yorkville will purchase two secured convertible debentures, each in the principal amount of $25 million. Additional secured convertible debentures totaling up to $50 million may be issued upon mutual agreement of the parties, at their sole discretion. The purchase price for each debenture remains 96% of its face value. The Convertible Debentures are convertible into shares of the Company’s common stock, subject to shareholder approval and customary closing conditions. The amendment also sets a floor price for conversions at 20% of the Nasdaq Official Closing Price immediately prior to the original agreement date.
Both agreements are subject to customary closing conditions, including stockholder approval and, in the case of the SEPA, the effectiveness of a registration statement. The Company may not access proceeds under the SEPA until any issued debentures have been repaid or converted, unless waived by Yorkville.
These financing arrangements are part of management’s broader strategy to address liquidity needs and support commercialization, R&D, and infrastructure expansion. However, there can be no assurance that the conditions to closing will be satisfied or that funding will be available on acceptable terms.
Future financing may include the issuance of equity or debt securities, credit facilities, or other arrangements. Any such financing could result in dilution to existing shareholders or the issuance of securities with rights senior to those of our common stock. Market volatility and macroeconomic conditions may also adversely affect our ability to raise capital on acceptable terms.
If we are unable to obtain sufficient funding, we may be required to delay, reduce, or eliminate our research and development programs, scale back commercialization efforts, or enter into strategic arrangements that may require us to relinquish rights to certain technologies or products.
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The Company’s liquidity forecast includes assumptions regarding the timing of Streamex Exchange’s product launch, expected capital inflows, and cost containment measures. A sensitivity analysis indicates that delays in product commercialization or capital raising could materially impact the Company’s ability to continue as a going concern.
Equity Financing
On March 5, 2025, the Company entered into a securities purchase agreement with certain accredited investors pursuant to which the Company sold to the Investors an aggregate of 758,514 shares Common Stock at a purchase price of $1.07974 per share, and warrants to purchase up to 758,514 shares of Common Stock at an exercise price of $0.95474 per share, that will become exercisable six months after the date of issuance and will expire three and one-half years following the date of issuance, in exchange for aggregate consideration of $818,998.
August 2025 Public Offering
On August 15, 2025, the Company completed a public offering of 3,852,149 shares of its common stock at a public offering price of $3.90 per share, generating gross proceeds of approximately $15.0 million before deducting underwriting discounts, commissions, and estimated offering expenses. Net proceeds from the offering were approximately $13.62 million.
ATM Sales Agreement
For the nine months ended September 30, 2025, the Company has sold 4,403,166 At The Market Offering Shares at an average offering price of $0.91 per share for aggregate gross proceeds of $4,019,063 or $3,882,420 net of fees of $136,643.
Critical Accounting Estimates
We prepare our unaudited condensed consolidated financial statements in accordance with GAAP, which require management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. These estimates are based on historical experience, current conditions, and other factors that management believes to be reasonable under the circumstances. Actual results may differ materially from these estimates, and such differences could have a significant impact on our financial condition or results of operations.
We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. There are items within our unaudited condensed consolidated financial statements that require estimation but are not deemed critical, as defined above.
As of September 30, 2025, the following accounting estimates are considered critical:
Valuation of Exchangeable Shares (Derivative Liability)
Nature of Estimate: Exchangeable Shares issued in connection with the Streamex Exchange acquisition are classified as a derivative liability under ASC 815 due to contingent conversion rights.
Methodology: Fair value is estimated using a discounted cash flow model incorporating projected cash flows, a 40% discount rate, and a 3% terminal growth rate. The valuation uses Level 3 inputs due to the absence of observable market data.
Estimation Uncertainty: The valuation is highly sensitive to assumptions regarding future performance, regulatory milestones, and shareholder approval timing.
Historical Accuracy and Changes: As of September 30, 2025, the fair value of the derivative liability was $115.7 million resulting in change in derivate liability of $10.2 million recognized in other income (expense) on the statement of operations.
Drivers of Variability: Key drivers include commercialization timelines, macroeconomic conditions, and investor sentiment.
Future Sensitivity: If shareholder approval is not obtained by November 28, 2025, the exchange ratio will adjust from 1.0 to 1.25, which could require a material upward revision to the liability. However, on November 4, 2025, the Company received shareholder approval of the Parent Stockholder Matters. As a result, the conversion cap was removed, and Streamex Exchange shareholders may now convert their Exchangeable Shares into the Company’s common stock. Concurrently, the derivative liability associated with the Exchangeable Shares was reclassified to permanent equity. The final valuation will reflect this reclassification as of November 4, 2025.
Purchase Price Allocation (PPA) for Streamex Exchange Acquisition
Nature of Estimate: The allocation of purchase consideration to identifiable assets and liabilities involves significant judgment, particularly for intangible assets and goodwill.
Methodology: We applied Level 3 valuation techniques under ASC 805, including the relief-from-royalty method for trade name, multi-period excess earnings method for developed technology, and cost approach for legal and compliance framework.
Estimation Uncertainty: These valuations rely on unobservable inputs such as royalty rates (1%), discount rates (40%), and projected cash flows.
Historical Accuracy and Changes: The PPA remains preliminary as of September 30, 2025. No adjustments have been recorded during the measurement period.
Drivers of Variability: Finalization of financial forecasts, market comparables, and tax amortization benefits may materially affect the allocation.
Future Sensitivity: Adjustments to intangible asset values or recognition of contingent liabilities could materially impact goodwill and amortization expense.
For a detailed discussion of our significant accounting policies and related judgments, see Note 3 of the Notes to Unaudited Condensed Consolidated Financial Statements in “Item 1. Financial Statements” of this report.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not required under Regulation S-K for “smaller reporting companies.”
ITEM 4. CONTROLS AND PROCEDURES
Management’s evaluation of disclosure controls and procedures.
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(e) under the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Based on management’s evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are not designed at a reasonable assurance level and are not effective in providing reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.
Management’s report on internal control over financial reporting.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting for our company. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) promulgated under the Exchange Act, as a process designed by, or under the supervision of, a company’s principal executive and principal financial officer and effected by the our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
| (1) | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; | |
| (2) | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made in accordance with authorizations of management and directors of the company; and | |
| (3) | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. |
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible enhancements to controls and procedures.
Management, including our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our internal control over financial reporting as of September 30, 2025, based on the criteria in a framework developed by the Company’s management pursuant to and in compliance with the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations (“COSO”) of the Treadway Commission. This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, walkthroughs of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, management has concluded that our internal control over financial reporting was not effective as of September 30, 2025, because management identified that i) inadequate identification, recording and reporting of stock based compensation, ii) ineffective review processes over period end financial disclosure and reporting, (iii) inadequate segregation of duties for transaction posting and processing, amounted to a material weakness in the Company’s internal control over financial reporting. and (iv) ineffective review controls, over the accounting for business combinations and related financial instruments.
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The material weaknesses did not result in any identified misstatements to the consolidated financial statements and there were no changes to previously released financial results.
Management’s Remediation Plan
In 2026, we have intents to add sufficient staff and oversight supervision controls to provide adequate accounting segregation. We believe these changes will remediate the underlying deficiencies as identified by us. The remediation efforts will include an ongoing review of the implementation of additional controls to ensure all risks have been addressed.
As a result of the material weaknesses discussed above or of others, we may experience negative impacts on our ability to accurately report our results of operation and financial condition in a timely manner. If we do identify a material weakness in our internal control over financial reporting and are unsuccessful in implementing or following a remediation plan, or fail to update our internal control over financial reporting as our business evolves or to integrate acquired businesses into our controls system, if additional material weaknesses are found in our internal controls in the future, or if our external auditors cannot attest to the effectiveness of our internal control over financial review, if applicable, we may not be able to timely or accurately report our financial condition, results of operations or cash flows or to maintain effective disclosure controls and procedures. If we are unable to report financial information in a timely and accurate manner or to maintain effective disclosure controls and procedures, we could be subject to, among other things, regulatory or enforcement actions by the SEC, an inability for us to be accepted for listing on any national securities exchange in the near future, securities litigation and a general loss of investor confidence, any one of which could adversely affect our business prospects and the market value of our common stock. Further, there are inherent limitations to the effectiveness of any system of controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. We could face additional litigation exposure and a greater likelihood of an SEC enforcement or other regulatory action if further restatements were to occur or other accounting-related problems emerge.
The weaknesses will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.
Changes in Internal Control over Financial Reporting
Except for the identification of the material weakness related the ineffective review controls, over the accounting for business combinations and related financial instruments as discussed above, there has been no change in our internal control over financial reporting identified in connection with the evaluation referred to above that occurred during our last completed fiscal quarter that has materially negatively affected, or is reasonably likely to materially affect, our internal control over financial reporting. As discussed above, management intends to implement remediation plans in 2025.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We may be subject at times to other legal proceedings and claims, which arise in the ordinary course of its business. Although occasional adverse decisions or settlements may occur, the Company believes that the final disposition of such matters should not have a material adverse effect on its financial position, results of operations or liquidity.
“Item 1 - Legal Proceedings” of our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2025, as filed on August 15, 2025 (the “June 2025 10-Q”), include a discussion of our legal proceedings. During the fiscal quarter ended September 30, 2025, there have been no material changes from the legal proceedings discussed in the June 2025 10-Q.
ITEM 1A. RISK FACTORS
In addition to the other information contained elsewhere in this Quarterly Report on Form 10-Q, you should carefully consider the risk factors discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K filed with the SEC on April 15, 2025, as well as the risk factors set forth in our Current Report on Form 8-K/A filed with the SEC on July 21, 2025 and in our Definitive Proxy Statement on Schedule 14A filed with the SEC on August 4, 2025.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES
During the three months ended September 30, 2025, the Company issued the following shares of its common stock in transactions not registered under the Securities Act of 1933, as amended (the “Securities Act”):
| ● | July 7, 2025: Issued 450,987 shares of common stock upon cashless exercise of warrants to purchase 524,412 shares at a weighted average exercise price of $12.76 per share. | |
| ● | July 8, 2025: Issued 82,537 shares of common stock upon cashless exercise of warrants to purchase 171,849 shares at an a weighted average exercise price of $11.79 per share. | |
| ● | August 8, 2025: Issued 92,136 shares of common stock upon cashless exercise of warrants to purchase 100,000 shares at an exercise price of $3.82 per share. | |
| ● | August 19, 2025: Issued 69,841 shares of common stock upon cashless exercise of warrants to purchase 74,312 shares at an exercise price of $4.99 per share. | |
| ● | August 26, 2025: Issued 100 shares of common stock upon cashless exercise of warrants to purchase 600 shares at an exercise price of $5.34 per share. | |
| ● | September 5, 2025: Issued 36,666 shares of common stock upon cashless exercise of warrants to purchase 46,307 shares at an exercise price of $4.59 per share. | |
| ● | September 8, 2025: Issued 40,000 shares of common stock to consultant for services rendered, valued at $155,200. | |
| ● | September 12, 2025: Issued 38,808 shares of common stock upon cashless exercise of warrants to purchase 46,307 shares at an exercise price of $5.90 per share. | |
| ● | September 17, 2025: Issued 5,845 shares of common stock upon cashless exercise of warrants to purchase 12,535 shares at an exercise price of $6.30 per share. |
All of the above issuances were made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D, as applicable. These transactions did not involve any public offering, and the recipients represented their intent to acquire the securities for investment purposes only and not with a view to distribution.
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ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
* Filed herewith.
** Furnished herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| STREAMEX CORP. | ||
| Date: November 14, 2025 | By: | /s/ Henry McPhie |
| Henry McPhie | ||
| Chief Executive Officer (Principal Executive Officer) | ||
| Date: November 14, 2025 | By: | /s/ Ferdinand Groenewald |
| Ferdinand Groenewald | ||
| Acting Chief Financial Officer (Principal Accounting Officer) | ||
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