Note 23: Subsequent Events

The Company has evaluated subsequent events through the filing of this Form 10-Q, and determined that there have been no events that have occurred that would require adjustments to disclosures in its condensed consolidated financial statements other than as discussed below:

Sale of ALT5 Sigma Canada, Inc.

On July 29, 2026, the Company and its first tier, wholly -(a Delaware corporation referenced in Note 1 as the “ALT5 Subsidiary”), owned subsidiary, Alt 5 Sigma, Inc., entered into an Acquisition Agreement with Prime Delta Corp., a Delaware corporation (“Prime Delta”), pursuant to which the Alt 5 Subsidiary sold to Prime Delta all of the issued and outstanding shares of Alt 5 Sigma Canada, Inc. (“Alt 5 Canada”; referenced in these Notes as our indirect, wholly-owned second tier Canadian subsidiary), through which the Company conducted its payments business. In exchange, the Company received the following consideration: (i) a four (4)-year secured promissory note (the “Prime Delta Note”) in the initial principal amount of $12.0 million, bearing interest at 4% per annum, with interest payments due on the 10^th day of each month, $1.0 million of principal payable on or before August 11, 2026, and the remaining principal payable in four equal annual installments of $2,750,000 (all subject to early payments in amounts no less than twenty percent (20%) of the net amounts received by Prime Delta from third-party investors of Prime Delta), and (ii) 11,551,750 newly issued shares of Prime Delta common stock (“Prime Delta Stock”). The Company valued the Prime Delta Note at its net present value of $9,251,847, using a market interest rate of 18%, less a Current Expected Credit Losses (CECL) discount of $5,876,847, for a net value of $3,375,000. The fair market value of the Prime Delta’s issued common stock is zero, as there is no readily ascertainable market for such shares. Accordingly, the aggregate fair market value of the consideration received is $3,375,000. The combined value of the Company’s investment in Alt 5 Canada through the ALT5 Subsidiary and the and the intercompany loans made to Alt 5 Canada is $17,415,025, resulting in a loss of $14,040,025 on the sale. The transaction closed on August 3, 2026.

The Prime Delta Note is secured by substantially all of the assets of Prime Delta and is guaranteed by certain affiliates of Prime Delta. In connection with the transaction, the Company assigned to Prime Delta the “Alt 5” and “Alt 5 Sigma” trademarks and related rights, agreed to cease use of those names, and agreed to change the names of its subsidiaries whose legal names include “Alt 5” within 90 days following the closing.

Additionally, through counsel for Prime Delta, the Company may offer the holders of its Series B Preferred Stock the opportunity to redeem their shares of Series B Preferred Stock, on a consensual basis, in exchange for their pro rata share of up to 8,551,750 shares of Prime Delta Stock, on a one share of Series B Preferred Stock -for-one share of Prime Delta Stock basis. No such redemption offer has commenced and no documentation has been prepared or filed, as applicable.

Amendments to Promissory Notes and Warrants

Effective July 7, 2026, the Company entered into Extension and First Amendment Agreements with the holders of ten promissory notes with an aggregate principal amount of CAD$2,750,000, pursuant to which the maturity dates of the notes were extended to October 1, 2026 in consideration of the payment of extension fees equal to 1.75% of the principal amount of each note, or CAD$48,125 in the aggregate. In connection with the extensions, the Company amended warrants held by five of the noteholders to purchase an aggregate of 340,000 shares of the Company’s common stock, to reduce the per-share exercise prices of each from $2.25 to $1.00 and to extend their expiration date from May 15, 2027 to December 31, 2027.

Concrete Agreement

On July 30, 2026, Alt5 Digital Holdings, Inc., a Wyoming corporation and indirect, wholly-owned subsidiary of the Company (“Alt5 Digital”), and Concrete Network Services Ltd, a BVI business company (“Concrete”), entered into a two-year Master Services Agreement (the “Agreement”), pursuant to which the parties determined that Concrete would provide certain services to Alt 5 Digital through two separate Statements of Work (the “SOWS”).  The services are generally described as vault infrastructure and related services on an exclusive basis in respect of $100,000,000 of WLFI tokens that ALT 5 Digital provided under the SOWS to Concrete.  Through a series of steps, Concrete will deposit and deploy $32,000,000 of cash or cash equivalent that it obtains in connection with the provision of its services into specific deployment activities agreed between the parties to generate certain investment returns, through which Concrete will be paid fees for the services referenced above and an otherwise unrelated third party will receive certain remuneration in connection with the tokens and the cash or cash equivalents that Concrete processes.  Concrete also delivered $3,000,000 of cash or cash-equivalents to Alt 5 Digital as an advance payment of those certain expected investment returns.  Such advance will be due and owing to Concrete and will be repaid by repayments expected to be generated, in full or in part, through such deployment activities.  Any shortfall in such repayment of the $3,000,000 is guaranteed by Alt 5 Digital.  Upon conclusion of the term and the parties receiving their specified yields, Concrete shall return to Alt 5 Digital the $100,000,000 of WLFI tokens that ALT 5 Digital had deposited with Concrete at the commencement of the parties’ relationship, subject to satisfaction of the applicable secured obligations and release conditions under the Agreement.  As of the date of this Quarterly Report, Concrete has deposited and deployed $25,000,000 of the referenced cash or cash equivalents.  Lastly, the Agreement provides for mutual indemnification between the parties.