7. Investments

a) Datacentrex Inc.

Initial investment and ownership

On March 13, 2025, the Company purchased 1,718,750 Class A membership units of US Data and Energy, LLC (“USDAE”), representing approximately 15.32% ownership, for $2,750,000 ($1.60 per unit). As the Company lacked control or significant influence and the units lacked a readily determinable fair value, the investment was accounted for under ASC 321, Investments—Equity Securities, using the measurement alternative (cost, less impairment, adjusted for observable price changes). On July 10, 2025, the Company sold 1,562,500 units for $2,500,000 at carrying value; no gain or loss was recognized. The Company retained 156,250 units and had a $250,000 carrying amount ($1.60 per unit).

On July 22, 2025, USDAE was acquired by Dogehash Technologies, Inc. (“Dogehash”), and the retained units were exchanged for 172,231 Dogehash common shares without additional consideration; the $250,000 aggregate basis was unchanged (approximately $1.45 per share).

On December 15, 2025, Dogehash completed a business combination with Thumzup Media Corporation and the public company was renamed Datacentrex, Inc (NASDAQ: “DTCX”). The Company then discontinued the measurement alternative and measured the publicly traded shares at fair value through earnings.

March 31, 2026 measurement

At March 31, 2026, the Company held 172,231 DTCX common shares (approximately 0.49% ownership). Using the $2.15 quoted closing price, the Level 1 fair value was $370,296 and was presented within short-term investments.  

June 2026 disposition

During June 2026, the Company sold 100% of their DTCX common shares for aggregate proceeds of $366,607, representing an average selling price of approximately $2.13 per share. In connection with sale, the Company derecognized the March 31, 2026 carrying amount of $370,296 and recognized a loss on disposal of $3,689 in the unaudited interim condensed consolidated statement of loss and comprehensive loss. The $366,607 of net sale proceeds is presented as proceeds from the sale of investments within investing activities in the unaudited interim condensed consolidated statement of cash flows and the $3,689 loss on disposal is presented as a reconciling non-cash adjustment within operating activities.

At June 30, 2026, the Company held no DTCX common shares, had no remaining ownership interest in Datacentrex and reported no related carrying amount.  

b) Stay Inc.

Initial investment and ownership

On June 12, 2025, the Company through its wholly owned subsidiary Dogecoin Ventures Inc., entered into an agreement with Stay Inc. (“Stay”), a privately held company, and acquired 6,000,000 Stay common shares for cash consideration of $1,200,000, or $0.20 per share. The investment represented approximately 6.9% of Stay’s outstanding basic common shares at the date of acquisition. The agreement provides the Company with the right to nominate one representative to Stay’s board of directors. Based on its ownership level and limited involvement, the Company determined that it does not exercise significant influence over Stay’s operating and financial policies. Accordingly, the investment is not accounted for under the equity method under ASC 323, Investments—Equity Method and Joint Ventures, and is within the scope of ASC 321, Investments—Equity Securities.

Conditional purchase commitments

Under the agreement the Company was required to purchase up to an additional 12,000,000 Stay common shares for $2,400,000 ($0.20 per share) if specific future liquidity events occurred within twelve months of the June 12, 2025 effective date. The potential additional purchases were:

As of June 30, 2026, neither liquidity event had been confirmed as occurring within the contractual period, nor additional shares had been issued or purchased, and the contractual period had expired. Accordingly, the contingent purchase provisions were not triggered, and, absent an amendment or extension, no further purchase commitment remained outstanding. No additional investment, commitment liability, or derivative liability was recognized as of June 30, 2026. At March 31, 2026, the contractual period remained open, and the maximum potential additional commitment was $2,400,000 for 12,000,000 shares, no liability was recognized because neither triggering event had occurred.

Subsequent measurement

Because the investment does not have a readily determinable fair value, the Company elected the measurement alternative under ASC 321. Accordingly, the investment is carried at cost, less impairment, adjusted for observable price changes in orderly transactions for identical or similar investments of the same issuer. As of June 30, 2026 and March 31, 2026, the Company held 6,000,000 Stay common shares and the carrying amount was $1,200,000. Management did not identify a qualifying observable transaction after the acquisition; $0.20 per share remained Stay’s most recently completed financing price. Management also did not identify impairment indicators as of June 30, 2026. Accordingly, no impairment loss or observable-price-change adjustment was recognized during the three months ended June 30, 2026 and the carrying amount did not change from March 31, 2026.

The investment is included in long-term investments on the unaudited interim condensed consolidated statements of financial position as of both June 30, 2026 and March 31, 2026.

c) McQueen Labs Inc.

The Company, through its wholly owned subsidiary Dogecoin Ventures Inc. (“DVI”), holds senior unsecured, non-interest-bearing convertible debentures and Series F convertible preferred shares issued by McQueen Labs Inc. (“McQueen”), a privately held Delaware corporation and a related party due to management relationships between the entities. DVI does not control McQueen and does not have the ability to exercise significant influence over McQueen’s operating or financial policies.

Convertible Debentures:

Transaction and contractual terms

During the year ended March 31, 2026, DVI acquired two senior unsecured, non-interest-bearing convertible debentures issued by McQueen with aggregate principal of $1,700,000. The $1,200,000 Tranche I was funded on May 9, 2025, and the $500,000 Tranche II was funded on June 30, 2025 through the transfer of 3,002,80 3 Dogecoin. In connection with the financings, DVI also received an aggregate of 1,700 Series F convertible preferred shares.

If a Qualified Offering or Qualified Event does not occur, the debentures are repayable in cash at maturity. Before maturity, the principal automatically converts upon a Qualified Offering or Qualified Event, including a qualifying public offering, direct listing, reverse takeover or de-SPAC transaction. The conversion price is the lower of the price derived from a $54.0 million valuation cap and 80% of the applicable five-day volume-weighted average trading price.

The debentures originally matured on February 9, 2026 and March 31, 2026, respectively. The agreements permitted two three-month extensions, subject to DVI’s consent. DVI consented to the first extensions on February 9, 2026 and March 31, 2026 and to the second extensions on May 9, 2026 and June 30, 2026. The second extensions revised the respective maturity dates to August 9, 2026 and September 30, 2026 and resulted in the issuance of an additional 180 and 75 Series F preferred shares.

At June 30, 2026, no Qualified Offering, Qualified Event, conversion, default, change-of-control event or cash repayment had occurred. The embedded conversion features were not accounted for separately from the debt hosts based on the terms and conditions of the instruments.

Accounting and subsequent measurement

The Company accounts for the debentures as available-for-sale debt securities under ASC 320, Investments - Debt Securities and measures them at fair value at each reporting date, with unrealized gains and losses recognized in other comprehensive income. The Series F preferred shares are equity securities within the scope of ASC 321, Investments - Equity Securities, Because the shares do not have a readily determinable fair value, the Company elected the measurement alternative and carries them at cost, less impairment, adjusted for observable price changes in orderly transactions for similar securities of McQueen. The Company did not elect recurring fair value measurement for the Series F preferred shares. The recurring fair value measurements of the debentures and the non-recurring grant-date fair value measurements of the Series F preferred shares are classified within Level 3 because their valuations use significant unobservable inputs.  

The Company estimated the fair value of the debentures using a discounted cash flow model based on the contractual principal amounts, remaining terms to maturity and a market-participant discount rate of 18.5%. At June 30, 2026, the fair values of Tranche I and Tranche II were $1,177,884 and $479,059, respectively, for an aggregate fair value of $1,656,943, compared with $1,178,432 and $479,282, respectively, and $1,657,714 in the aggregate at March 31, 2026.

During the three months ended June 30, 2026, the 255 Series F preferred shares issued in connection with the second extensions were initially recognized at an aggregate grant date fair value of $30,655. The debentures were then re-measured to fair value. The Company recognized a net unrealized gain of $29,884 related to the debentures in other comprehensive income during the quarter. Cumulative unrealized gains included in accumulated other comprehensive income were $222,622 at June 30, 2026.

Series F convertible preferred shares

In connection with the original financings, DVI received 1,700 Series F convertible preferred shares. Each Series F share is convertible into McQueen common shares at a fixed conversion price of $0.54 per share during the 36-month period following the applicable closing and converts mandatorily upon a Qualified Offering or Qualified Event. The Series F shares were privately issued, are subject to transfer restrictions and are not traded in an active market.

Under the debenture agreements, each three-month maturity extension entitles DVI to additional Series F preferred shares with an aggregate stated value equal to 15% of the funded amount of the related debenture. The first extensions resulted in 180 and 75 additional shares. During the three months ended June 30, 2026, the second extension resulted in an additional 180 shares on May 9, 2026 and 75 shares on June 30, 2026. DVI held 2,210 Series F preferred shares at June 30, 2026, compared with 1,955 shares at March 31, 2026.

The second-extension shares were initially measured at grant-date fair value. The 180 shares received on May 9, 2026 were initially measured at $21,639, and the 75 shares received on June 30, 2026 were initially measured at $9,016. The shares were accounted for as non-cash consideration for contractual extensions and as a continuation of the existing investment.  

The Company applies the ASC 321 measurement alternative to all McQueen Series F preferred shares because the shares do not have a readily determinable fair value. Following initial recognition at grant-date fair value, the shares are carried at cost, less impairment, adjusted for qualifying observable price changes. At March 31, 2026, the carrying amount of the 1,955 preferred shares was $235,024. The Company did not identify an impairment indicator or a qualifying observable price change at March 31, 2026.

Fair value measurements

The grant-date fair value of the Series F preferred shares was estimated using an option-pricing-method backsolve calibrated to the consideration paid in recent McQueen equity financings. Significant unobservable inputs included a risk-free interest rate of 3.92% and expected volatility of McQueen common shares of 125%. These initial recognition measurements are classified within Level 3 of the fair value hierarchy.  

At June 30, 2026, the carrying amount of the Company’s 2,210 Series F preferred shares was $265,679, compared with $235,024 for 1,955 shares at March 31, 2026. No impairment or qualifying observable price adjustment was recognized during the three months ended June 30, 2026. The total carrying amount of the McQueen investment was $1,922,622 at June 30, 2026, compared with $1,892,738 at March 31, 2026.

Related-party transactions

McQueen is a related party of the Company due to management relationships between the entities. The Company’s related-party transactions with McQueen consisted of the acquisition and extension of the convertible debentures and the receipt of Series F preferred shares described above. The related investment balances were $1,922,622 and $1,892,738 at June 30, 2026 and March 31, 2026, respectively. No amounts were payable to McQueen at either date.

The following table summarizes the Company’s recurring Level 3 fair value measurements at June 30, 2026. The Series F preferred shares are excluded because they are not subsequently measured at recurring fair value:

Credit loss assessment and presentation

Available-for-sale debt securities are evaluated for credit losses when their fair value is below adjusted amortized cost. At June 30, 2026 and March 31, 2026, the fair value of the McQueen debentures exceeded their adjusted amortized cost basis, and management did not identify a credit-related loss. Accordingly, no allowance for credit losses was recorded at either date. The Series F preferred shares are evaluated for impairment and qualifying observable price changes under ASC 321. No impairment indicator or qualifying observable price change was identified at June 30, 2026 or March 31, 2026. The debentures are presented as short-term investments because their contractual maturities were within twelve months of each reporting date, and the Series F preferred shares are presented as long-term investments on the unaudited interim condensed consolidated statement of financial position.

d) Investment in CleanCore Solutions Inc.

The Company, through its wholly owned subsidiary Dogecoin Ventures Inc., holds CleanCore Solutions Inc. (“CleanCore”) common shares, pre-funded warrants and strategic advisory services warrants. Following the June 30, 2026 merger with Brag House Holdings, Inc. (“Brag House”), the consolidated balance also includes 4,000,000 CleanCore Class B common shares held by Brag House.

Pre-funded warrants and common shares

On September 5, 2025, the Company acquired 10,000,000 pre-funded warrants to purchase CleanCore Class B common shares for aggregate consideration of $10,000,000. The consideration consisted of $4,250,110 in cash and $5,749,890 in digital assets, representing 26,856,093 Dogecoin measured at fair value on the transaction date. Each pre-funded warrant was exercisable for one CleanCore common share after payment of a nominal remaining exercise price of $0.0001 per share. The aggregate nominal remaining exercise price of $1,000 was included in the upfront consideration.

On September 23, 2025, 9,000,000 of the pre-funded warrants were automatically exercised and converted into 9,000,000 CleanCore Class B common shares after completion of the applicable shareholder notice and board approval process. Immediately before exercise, the warrants were re-measured to an aggregate fair value of $17,820,000 using the quoted CleanCore share price of $1.98 per share. The resulting $8,820,000 fair value gain was recognized in earnings, and the fair value of the exercised warrants was reclassified to CleanCore common shares. No substantive additional cash consideration was paid upon exercise. Following the conversion, 1,000,000 pre-funded warrants remained outstanding.

On June 30, 2026, the Company completed its merger with Brag House. Upon consolidation, the Company included 4,000,000 CleanCore Class B common shares held by Brag House. Together with the 9,000,000 shares held by Dogecoin Ventures Inc. (“DVI”), the Company included 13,000,000 CleanCore Class B common shares in its consolidated financial statements at June 30, 2026.

At June 30, 2026, the 13,000,000 common shares included in the consolidated financial statements had a fair value of $10,659,999 based on the quoted closing market price of approximately $0.82 per share, compared with 9,000,000 shares with a fair value of $3,204,000 based on $0.356 per share at March 31, 2026. Of the June 30, 2026 balance, 9,000,000 shares were held by DVI, and 4,000,000 shares were held by Brag House. The remaining 1,000,000 pre-funded warrants had fair values of $819,916 and $355,918 at June 30, 2026 and March 31, 2026, respectively, based substantially on the quoted value of the underlying CleanCore common shares, adjusted for the nominal remaining exercise price. The common shares and the remaining pre-funded warrants are re-measured at each reporting date, and changes in fair value are recognized in earnings.

During the three months ended June 30, 2026, the Company recognized an unrealized gain of $4,176,000 on the 9,000,000 common shares held by DVI and an unrealized gain of $463,999 on the remaining pre-funded warrants. The 4,000,000 shares held by Brag House were included in the consolidated financial statements upon completion of the merger on June 30, 2026 and are not included in these quarterly fair value changes.

At June 30, 2026, all CleanCore common shares and warrants held by the Company were pledged as collateral under the Yorkville financing arrangement and were restricted from transfer. See Note 10, Short-term debt.

Strategic advisory services warrants

On September 5, 2025, the Company entered into a five-year strategic advisory services agreement with CleanCore. As non-cash consideration for strategic integration and diversification, treasury and industry advisory, vendor selection and strategic partnerships, reporting and board advisory, and ongoing strategic support, the Company received 14,000,034 warrants to purchase CleanCore common shares. The warrants were issued in the following two tranches:

The strategic advisory services warrants had an aggregate grant-date fair value of $41,700,044, consisting of $26,212,079 for the $1.00 tranche and $15,487,964 for the $1.33 tranche. At grant, the Company recognized the warrant assets and a corresponding contract liability for future advisory services. The strategic advisory arrangement was terminated effective March 6, 2026. The termination did not cancel, forfeit, modify or subject the warrants to refund or claw back. Accordingly, the warrants remained outstanding as freestanding financial assets and continued to be measured at fair value through earnings after the service arrangement ended. Upon termination of the strategic advisory arrangement, the remaining $37,543,742 contract liability was recognized in other income rather than revenue. No additional advisory services were provided, and no advisory revenue or deferred revenue activity occurred during the three months ended June 30, 2026 and 2025.

Accounting policy and significant influence assessment

The CleanCore common shares are equity securities with readily determinable fair values and are measured at fair value through net income under ASC 321, Investments - Equity Securities. The pre-funded warrants and strategic advisory services warrants are freestanding financial assets measured at fair value through earnings under the applicable financial instrument guidance, including ASC 815, Derivatives and Hedging, and ASC 820, Fair Value Measurement. The Company recognizes changes in fair value within loss (gain) on change in fair value of investments in the unaudited interim condensed consolidated statements of operations and comprehensive loss. Because these instruments are measured at fair value through earnings, a separate impairment model is not applied.

The Company’s asset-management, strategic-advisory and other service arrangements with CleanCore were terminated effective March 6, 2026, and the Company had no continuing rights to provide services to or participate in the management or operating policies of CleanCore. During the year ended March 31, 2026, CleanCore was a related party of the Company because of board and management relationships between the entities. Timothy Stebbing, the Company’s Chief Technology Officer, served as a CleanCore director, and Marco Margiotta, the Company’s Chief Executive Officer, served as CleanCore’s Chief Investment Officer until March 4, 2026. Mr. Stebbing continued to serve as a director of CleanCore after termination of the arrangements, although his board service did not arise from a contractual designation right held by the Company. The Company had no contractual right to appoint, nominate or remove a CleanCore director. Following termination of the service arrangements, Mr. Margiotta’s resignation and the cessation of Mr. Stebbing’s role as a representative of the Company, management concluded that CleanCore was no longer a related party after March 6, 2026. The Company recognized no revenue from the terminated CleanCore service arrangements during the three months ended June 30, 2026 or 2025, and no related accounts receivable or contract liabilities were outstanding at June 30, 2026 or March 31, 2026.

At June 30, 2026, the 13,000,000 CleanCore common shares included in the consolidated financial statements represented approximately 5% of CleanCore’s outstanding common shares. Assuming exercise of the remaining pre-funded warrant and all strategic advisory services warrants, the Company’s potential ownership would remain below the 20% presumption threshold before considering the contractual beneficial-ownership limitations of 4.99%, or 9.99% if elected following the required advance notice. The Company did not hold any contractual right to appoint, designate or remove a CleanCore director, veto or consent rights, or other contractual rights to participate in CleanCore’s operating or financial policy decisions. Based on the Company’s voting ownership, potential ownership, contractual rights and the termination of the service arrangements on March 6, 2026, management concluded that the Company did not have the ability to exercise significant influence over CleanCore at June 30, 2026 or March 31, 2026. Accordingly, the equity method of accounting was not applied at either reporting date.

Fair value changes recognized in earnings

The following table summarizes the changes in fair value recognized in earnings for the three months ended June 30, 2026:

The fair value changes reflect the increase in CleanCore’s quoted share price from $0.356 at March 31, 2026 to approximately $0.82 at June 30, 2026 and, for the strategic advisory services warrants, changes in the market-based assumptions used in the option-pricing model. The quarterly fair value gain excludes the 4,000,000 CleanCore common shares held by Brag House that were included in the consolidated financial statements upon completion of the merger on June 30, 2026.

Fair value hierarchy

The following table presents the recurring fair value measurements for the CleanCore instruments as of June 30, 2026:

The common shares are classified within Level 1 because they are valued using an unadjusted quoted price in an active market. The remaining pre-funded warrants and strategic advisory services warrants are classified within Level 2 because their fair values are derived from the quoted CleanCore common share price, contractual terms and other market-based observable inputs. There were no transfers between levels during the three months ended June 30, 2026.

Valuation techniques and inputs

The fair value of the remaining pre-funded warrants was based substantially on the quoted CleanCore common share price, adjusted for the nominal remaining exercise price. The Company used the Black-Scholes option-pricing model to estimate the fair value of the strategic advisory services warrants. The model is an income-approach valuation technique. The following table summarizes the principal inputs used for the strategic advisory services warrants at June 30, 2026 and March 31, 2026:

The fair value of the strategic advisory services warrants is particularly sensitive to changes in CleanCore’s common share price and expected volatility. In isolation, increases in the share price, expected term or expected volatility generally increase the estimated fair value of the strategic advisory services warrants, while decreases in those assumptions generally reduce the estimated fair value. Changes in the risk-free interest rate and dividend yield have a comparatively smaller effect at the reported exercise prices and remaining terms.

e) 21Shares Dogecoin ETF (TDOG)

Initial acquisition and ownership

The Company holds common shares of beneficial interest in the 21Shares Dogecoin ETF (“TDOG”), which provides indirect exposure to Dogecoin. The investment is accounted for under ASC 321 and measured at fair value, with changes in fair value recognized in earnings. The investment is classified as long term because management does not intend to sell the shares within twelve months of June 30, 2026. The Company concluded that it neither controls nor exercises significant influence over TDOG because the trust is managed by its sponsor and the shares do not provide the Company with substantive voting, management or policy-making rights, and the Company’s separate role as a service provider to the Trust does not provide power over the activities that most significantly affect the Trust’s economic performance. Accordingly, the Company does not consolidate the Trust and does not apply the equity method to its TDOG investment.

In April 2026, the Company purchased an aggregate of 78,000 TDOG shares for consideration of $1,468,805. The Company incurred commissions and handling fees of $14,663, which were recognized in expense as incurred because the shares are subsequently measured at fair value through net income. Total cash settlement for the purchases was $1,483,468.

At June 30, 2026, the carrying value was determined using the unadjusted quoted market price of $14.5256 per share multiplied by 78,000 shares. During the three months ended June 30, 2026, the Company recognized an unrealized loss of $335,808 on the change in fair value of the investment in earnings. No amount was recognized in other comprehensive income.

Fair value measurement

The TDOG shares are measured on a recurring basis using an unadjusted quoted price in an active market and are therefore classified within Level 1 of the fair value hierarchy under ASC 820, Fair Value Measurement. The following table presents the fair value hierarchy for investment. The Company held no TDOG shares at March 31, 2026, and there were no transfers among levels during the three months ended June 30, 2026.

At June 30, 2026, all 78,000 TDOG shares were restricted because they were pledged as collateral for the margin arrangement loan of $700,000 (See Note 10 - Short-term debts). Under the brokerage terms, the broker may sell, loan or repledge securities in the account. The Company continues to recognize the pledged shares as an investment and related margin liabilities are presented gross in the condensed consolidated balance sheet.

March 31, 2026 purchase commitment

At March 31, 2026, the Company’s contractual commitment to purchase $1.5 million of TDOG shares was executory. No trade or subscription had been accepted, no shares had been delivered, and no funds had been remitted or escrowed. Accordingly, the Company recognized no investment asset, purchase payable, expense, derivative instrument or loss contingency at March 31, 2026. The April 2026 purchases fully satisfied the commitment, and no remaining TDOG purchase commitment existed at June 30, 2026. The investment purchase was separate from the Company’s service arrangement with 21Shares and was not recorded as consideration payable to a customer or as a reduction of revenue.

f) LBK Triestina Holdings LLC

The Company, through its wholly owned subsidiary Dogecoin Ventures Inc. (“Dogecoin Ventures”), holds preferred membership units in LBK Triestina Holdings LLC (“LBK”), a Delaware limited liability company that indirectly owns and operates Unione Sportiva Triestina Calcio 1918 s.r.l. (“Triestina”), an Italian professional football club.

At June 30, 2026 and March 31, 2026, the investment had a carrying amount of nil after recognition of equity-method losses, basis-difference expense and impairment losses. The Company’s direct ownership interest increased to 42.68% at June 30, 2026 from 40.03% at March 31, 2026 as a result of additional capital contributions during the three months ended June 30, 2026.

Background and ownership

Dogecoin Ventures became a preferred member of LBK on December 1, 2025, when LBK’s Second Amended and Restated Limited Liability Company Agreement became effective. At March 31, 2026, Dogecoin Ventures held 3,735,267 preferred units, representing a 40.03% direct ownership interest, and had a cumulative investment cost of $5,196,127.

During the three months ended June 30, 2026, the Company made additional capital contributions of $1,029,064, consisting of $779,064 in April 2026 and $250,000 in May 2026. Of these contributions, $460,000 was funded directly by Dogecoin Ventures and $569,064 of principal was funded through related-party loans; $5,345 of related interest was recognized under the related-party funding arrangements. At June 30, 2026, Dogecoin Ventures held 4,502,585 preferred units, representing a 42.68% direct ownership interest, and its cumulative investment cost was $6,225,191.

Equity-method accounting and consolidation assessment

The Company accounts for its investment in LBK under the equity method because its ownership interest, director-designation rights and participation rights provide it with the ability to exercise significant influence over LBK’s operating and financial policies. At June 30, 2026, and March 31, 2026, LBK’s board consisted of two directors, one of whom was designated by the Company. Accordingly, the Company held one of the two board seats but did not control a majority of the board. .The Company also held less than 50% of LBK’s voting interests, cannot establish a board quorum by itself and lacks unilateral power to direct the activities that most significantly affect LBK’s economic performance. Accordingly, the Company does not have a controlling financial interest in LBK and is not its primary beneficiary; therefore, the Company does not consolidate LBK under either the voting-interest or variable-interest-entity model. The Company recognizes its direct share of LBK’s earnings or losses using the applicable direct sharing percentage and adjusts the investment for purchase-date basis differences associated with the underlying net assets.

Impairment and nonrecurring fair value measurements

The Company evaluates its equity-method investment for impairment when events or changes in circumstances indicate that a decline in value may be other than temporary. The Company made additional capital contributions of $1,029,064 during the three months ended June 30, 2026, but concluded that the decline in value remained other than temporary and recognized an impairment loss and reduced the investment to its estimated fair value of nil.

The June 30, 2026 fair value measurement was a nonrecurring Level 3 measurement. Management considered LBK’s recurring operating losses, negative net assets, continuing dependence on capital support, Triestina’s relegation from Series C to Series D, the ongoing legal and criminal investigation involving Triestina and certain current and former directors, technical insolvency, creditor claims, potential judicial-liquidation exposure, the negotiated business-crisis settlement process described below and the resulting bankruptcy risk. These significant factors indicated that the additional contributions represented capital support in a distressed and capital-dependent Company. Based on the totality of these factors management estimated the fair value of the investment at nil.

Legal and restructuring matters

On June 25, 2026, Triestina filed a petition to initiate a negotiated business-crisis settlement process under Italian law (the “CNC”), together with a request for protective measures and a draft restructuring plan. The Trieste Chamber of Commerce appointed an independent expert on June 30, 2026. At that date, Triestina was technically insolvent, and depended on continued investor funding and faced creditor claims, including a petition seeking judicial liquidation. The CNC is a consent-based creditor negotiation process and does not assure a successful restructuring; the process may terminate if recovery prospects are not demonstrated, which could result in judicial liquidation or bankruptcy.

On July 1, 2026, the expert accepted the appointment and the request for protective measures was published in the applicable business register. Management considered these subsequent procedural developments to the extent they provided additional evidence about the legal and financial conditions that existed at June 30, 2026. No gain or restoration of the previously impaired investment was recognized.