Tharimmune - 10-K annual report 2025

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM10-K

☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2025

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to _________

Commission file number 001-41210

CANTON STRATEGIC HOLDINGS, INC.

(Exact name of registrant as specified in charter)

(732)889-3111

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting stock and non-voting common equity held by non-affiliates of the registrant as of the last business day of the registrant’s most recently completed second fiscal quarter ended June 30, 2025 was $6.4million based upon the closing price of the registrant’s common stock of $1.94 on The Nasdaq Capital Market as of that date.

Number of common shares outstanding as of March 26, 2026 was 56,656,271.

Documents Incorporated by Reference: None.

Table of Contents

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements may be identified by such forward-looking terminology as “may,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these terms or other comparable terminology. Our forward-looking statements are based on a series of expectations, assumptions, estimates and projections about our company, are not guarantees of future results or performance and involve substantial risks and uncertainty. We may not actually achieve the plans, intentions or expectations disclosed in these forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in these forward-looking statements. Our business and our forward-looking statements involve substantial known and unknown risks and uncertainties, including the risks and uncertainties inherent in our statements regarding:

All of our forward-looking statements are as of the date of this Annual Report on Form 10-K only. In each case, actual results may differ materially from such forward-looking information. We can give no assurance that such expectations or forward-looking statements will prove to be correct. An occurrence of, or any material adverse change in, one or more of the risk factors or risks and uncertainties referred to in this Annual Report on Form 10-K or included in our other public disclosures or our other periodic reports or other documents or filings filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”) could materially and adversely affect our business, prospects, financial condition and results of operations. Except as required by law, we do not undertake or plan to update or revise any such forward-looking statements to reflect actual results, changes in plans, assumptions, estimates or projections or other circumstances affecting such forward-looking statements occurring after the date of this Annual Report on Form 10-K, even if such results, changes or circumstances make it clear that any forward-looking information will not be realized. Any public statements or disclosures by us following this Annual Report on Form 10-K that modify or impact any of the forward-looking statements contained in this Annual Report on Form 10-K will be deemed to modify or supersede such statements in this Annual Report on Form 10-K.

This Annual Report on Form 10-K may include market data and certain industry data and forecasts, which we may obtain from internal company surveys, market research, consultant surveys, publicly available information, reports of governmental agencies and industry publications, articles and surveys. Industry surveys, publications, consultant surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but the accuracy and completeness of such information is not guaranteed. While we believe that such studies and publications are reliable, we have not independently verified market and industry data from third-party sources.

RISK FACTOR SUMMARY

Our business is subject to significant risks and uncertainties that make an investment in us speculative and risky. Below we summarize what we believe are the principal risk factors but these risks are not the only ones we face, and you should carefully review and consider the full discussion of our risk factors in the section titled “Risk Factors,” together with the other information in this Annual Report on Form 10-K. If any of the following risks actually occur (or if any of those listed elsewhere in this Annual Report on Form 10-K occur), our business, reputation, financial condition, results of operations, revenue, and future prospects could be seriously harmed. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business.

PART I

Throughout this Annual Report on Form 10-K, references to “we,” “our,” “us,” the “Company,” or “Canton Strategic,” refer to Canton Strategic Holdings, Inc., individually, or as the context requires, collectively with its subsidiaries.

ITEM 1. BUSINESS

Overview

We are the first publicly traded company to leverage Canton Coin (“CC”) and support the Canton Network to advance institutional blockchain adoption and the digitization of financial markets. In addition to driving value through activities on the Canton Network, we also operate clinical-stage biotech research and development programs.

From 2022 through late-2025, we primarily operated as a biotechnology company, developing therapeutic candidates in inflammatory and immunologic conditions with high unmet need. In November 2025, we undertook a strategic shift to prioritize disciplined digital asset treasury management and investment in the digital asset ecosystem, specifically the Canton Network.

Since November 2025, we have strengthened our liquidity and expanded our access to capital through a public offering of common stock and private placements, and by establishing a shelf registration statement and our ATM Program (as defined below).

Our Digital Asset Treasury Strategy

We believe that the configurable privacy enabled by the Canton Network’s blockchain technology is transforming the future of global finance by connecting leading institutions on a single, secure, and interoperable blockchain. With trillions of assets represented on-chain and the support of major market participants, the Canton Network delivers real-world utility, privacy, and atomic settlement. CC plays a critical role as the utility token for transactions on the Canton Network, with a purposefully designed tokenomics policy that seeks to drive transparency and align incentives across the ecosystem. Our strategic digital asset reserve of CC reflects our conviction in the potential of the Canton Network to drive efficiency, transparency, and resiliency in global markets.

This Canton digital asset treasury strategy is part of our broader approach to enhancing our platform with capital efficiency, diversifying treasury management practices, and engaging with emerging financial technologies. We intend to execute a diverse strategy with the following key elements:

The strategy is designed to supplement our capital allocation framework by integrating a forward-looking, technology-driven approach to treasury management. Over time, participation in the Canton Network—through infrastructure operations, token management, and strategic ecosystem investments—may offer strategic advantages for product development and global expansion.

Overview of Canton Network and Canton Coin

Canton Network is a public, permissionless blockchain with privacy proven to work at institutional scale. Unlike traditional public blockchains, Canton operates as a “network of networks,” where independently governed applications interoperate securely through decentralized public infrastructure called the Global Synchronizer.

We view the following Canton Network developments as particularly relevant to our strategy:

Built for Institutional Privacy. Canton’s protocol implements “proof-of-stakeholder” validation which, unlike traditional proof-of-stake networks, ensures that only the parties to a transaction can see and validate it. The Global Synchronizer uses Byzantine Fault Tolerant consensus to time-order cross-application transactions, keep participants in sync and prevent conflicts. It doesn’t replicate and broadcast all data globally; it coordinates proofs between participants, ensuring everyone reaches the same outcome, while always preserving privacy.

Network Scale and Institutional Adoption. Major institutions, fintechs and a fast-growing builder community create applications on Canton to transact and synchronize assets and data atomically, 24/7, with highly configurable privacy. Today, applications running on Canton enable cross-market settlement and asset mobility without compromising confidentiality and process more than $6 trillion in tokenized real-world assets, including over $350 billion in daily U.S. Treasury repo. The Global Synchronizer is independently stewarded by the neutral Canton Foundation, which facilitates open governance, covering protocol oversight and improvement proposals.

Differentiated Tokenomics. CC is the native utility token of the network, used to pay traffic fees for the Global Synchronizer, and to reward those who contribute measurable utility to the ecosystem. Every coin in circulation is earned through network participation only. Such participation includes application providers building high-utility apps, users driving activity, Validators, and infrastructure operators (Super Validators). CC’s fair-launch and incentive alignment across the network anchors the token in real-world transactions and utility over speculation.

CC supply follows a declining issuance curve designed to reward early contributors while trending toward long-term sustainability. CC issuance started high to bootstrap participation and app development, then halves periodically (with the next halving in the second quarter of 2029) to balance inflation and burn. The share of new CC issuances is now shifting from favoring Super Validators to applications and Validators. Unlike other networks, approximately two-thirds of total supply over the first 10 years is available as rewards for application providers and Validators, with approximately one-third to Super Validators.

CC follows a burn-and-mint equilibrium model that ties supply to verified network activity rather than fixed inflation or pre-minted reserves. It provides a dynamic balance between fixed, dollar-denominated fees and a floating CC market price against a known issuance curve. Fees are fixed in $ terms, with users paying a set $ / MB for transactions that use the Global Synchronizer. The quantity of CC burned depends on market price: users pay for network fees by burning the $USD equivalent amount of CC at the on-chain conversion rate.

If the price is too high relative to on-chain activity, mint exceeds burn (net inflation), creating downward pressure on price. If the price is too low relative to activity, burn exceeds mint (net deflation), creating upward pressure on price. Over time, the system seeks an equilibrium where long-run net supply change approaches zero. Because equilibrium can occur at different price/activity combinations, the ultimate total CC supply is not predetermined. This mechanism ensures that Canton’s token economy remains sustainable, utility-aligned, and structurally supported as adoption scales — unlike the fixed-inflation models of many other L1 networks.

Custody of our CC Tokens

We hold substantially all of our CC tokens in custody accounts with institutional-grade custodians that have demonstrated records of regulatory compliance and information security. As a result, the primary counterparty risk we are exposed to with respect to our CC tokens is performance obligations under the various custody arrangements into which we have entered. We custody our CC tokens across multiple custodians to diversify our potential risk exposure to any one custodian.

We carefully select the custodians that custody our CC tokens after undertaking a due diligence process. We negotiate specific contractual terms and conditions with our custodians that we believe will help establish, under existing law, that our property interest in the CC tokens held by our custodians is not subject to the claims of the custodian’s creditors in the event the custodian enters bankruptcy, receivership or similar insolvency proceedings. All of our custodians are subject to regulatory regimes intended to protect customers in the event that a custodian enters bankruptcy, receivership or similar insolvency proceedings. Based on existing law and the terms and conditions of our contractual arrangements with our custodians, we believe that the CC tokens held on our behalf by our custodians would not be considered part of a custodian’s bankruptcy estate were one or more of our custodians to enter bankruptcy, receivership or similar insolvency proceedings. For a discussion of risks relating to the custody of our CC tokens, see “Item 1A. Risk Factors— Risks Related to Our CC Strategy and Holdings — We face risks relating to the custody of our CC tokens, including the loss or destruction of private keys required to access our CC tokens and cyberattacks or other data loss relating to our CC tokens, including smart contract related losses and vulnerabilities.”

Our Therapeutic Candidate Developments

Through our subsidiary Gravitas, we develop therapeutic candidates in immunology and inflammation with high unmet need.

Our Product Pipeline

GV 104

GV104 (formerly TH104) is a proprietary buccal film formulation of nalmefene, a long-acting opioid antagonist, being developed for prophylactic protection against synthetic opioid exposure in military and first responder populations. GV104 is a buccal film containing 16 mg of nalmefene, designed for rapid absorption through the oral mucosa. The film is approximately the size of a dime, enabling discreet and convenient administration without water or injection equipment. Buccal delivery bypasses hepatic first-pass metabolism, resulting in higher bioavailability compared to oral administration.

Nalmefene is a 6-methylene derivative of naltrexone with pharmacological properties that address the limitations of naloxone. In a head-to-head clinical study comparing intramuscular nalmefene to intramuscular and intranasal naloxone for reversal of fentanyl-induced respiratory depression, nalmefene demonstrated a plasma half-life of 8 to 11 hours compared to 30 to 90 minutes for naloxone, and mu-opioid receptor binding affinity approximately 3.6 to 5.4 times higher than naloxone.³ In this study, nalmefene achieved faster onset, greater magnitude, and longer duration of respiratory depression reversal, with 100% of subjects achieving respiratory recovery compared to 60-80% for naloxone formulations.⁴

We are pursuing FDA approval through the 505(b)(2) regulatory pathway, which permits reliance on the FDA’s prior findings of safety and effectiveness for REVEX (nalmefene hydrochloride injection), which was approved by the FDA in 1995 and determined by the FDA in November 2017 to not have been withdrawn from sale for reasons of safety or effectiveness.⁵ Following a Type C meeting with the FDA in March 2025, we confirmed that no additional clinical trials are required to support our NDA submission. We anticipate initiating a rolling NDA submission in the first half of 2027, with FDA approval anticipated in the first half of 2028.

GV023

GV023 (formerly TH023), is an oral anti-tumor necrosis factor-alpha (TNF-α) monoclonal antibody, infliximab. On September 11, 2024, we entered into a Patent License Agreement (the “Intract Agreement”) with Intract Pharma Limited (“Intract”), pursuant to which, we exclusively licensed GV023. Infliximab is a purified recombinant DNA-derived chimeric IgG monoclonal antibody protein that contains both murine and human components that inhibit tumor TNF-a. Under the terms of the Intract Agreement, we licensed global development and commercialization rights (outside of South Korea) to Intract’s Soteria® and Phloral® delivery platform along with an existing supply agreement for infliximab to be used in the oral product development program.

³Cipriano A, Apseloff G, Kapil RP, He E, Shet M, Harris SC. Time Course of Reversal of Fentanyl-Induced Respiratory Depression in Healthy Subjects by Intramuscular Nalmefene and Intramuscular and Intranasal Naloxone. J Clin Pharmacol. 2025;65(2):206-216. PMID: 39347921.

⁴Wang DS, Sternbach G, Varon J. Nalmefene: A Long-Acting Opioid Antagonist. Clinical Applications in Emergency Medicine. J Emerg Med. 1998;16(3):471-475. PMID: 9610980

⁵FDA. Determination That REVEX (Nalmefene Hydrochloride Injection) Was Not Withdrawn From Sale for Reasons of Safety or Effectiveness. Federal Register. 2017;82(212):51051-51052. November 3, 2017.

GV023, an oral formulation of infliximab, addresses a critical limitation of the IV gold standard by eliminating the treatment burden of repeated intravenous infusions. By enabling patient self-administration, an oral TNF-alpha inhibitor may potentially improve medication adherence and persistence while expanding treatment access to patients who currently defer IV therapy due to infusion center barriers, needle anxiety, or lifestyle constraints.

Company Developments

In the fourth quarter of 2025 and into early 2026, the Company completed a series of significant financing transactions and related strategic initiatives designed to fund its digital asset treasury and CC treasury strategy, validator operations and related activities.

November 2025 PIPE

In November 2025, the Company completed a private placement offering with accredited investors providing for a private investment in public equity transaction, consisting of (i) the sale of an aggregate of 25,966,048 shares of common stock and cash pre-funded warrants (the “Cash Offering”) and (ii) the issuance of cryptocurrency pre-funded warrants in exchange for CC (the “Cryptocurrency Offering”) contributed by participating investors. We raised in aggregate gross proceeds of approximately $545 million before fees and expenses. Under the terms of the offering, a limited portion of available cash was designated for legacy operating expenses and existing management compensation, with the balance of proceeds allocated to transaction expenses and the acquisition of CC and implementation of the Company’s CC treasury and validator strategy.

January 2026 Offering

Subsequently, on January 20, 2026, the Company entered into an underwriting agreement with Clear Street LLC, as sole underwriter, for an underwritten registered direct offering to a single institutional investor consisting of 1,800,000 shares of common stock and pre-funded warrants to purchase up to 17,000,000 additional shares at a per share offering price of $2.9200 (less $0.0001 per pre-funded warrant share). The Company announced the closing of this offering for gross proceeds of approximately $54.9 million on January 22, 2026. Collectively, these financings and governance actions were undertaken to strengthen the Company’s capital base and support execution of its revised treasury and network participation strategy.

ATM Program

Concurrently with the closing of the PIPE Transaction, on November 6, 2025, the Company entered into an at-the-market sales agreement (the “Original Sales Agreement”) with Clear Street LLC (“Clear Street”) and President Street Global, LLC (“President Street”) providing for the offer and sale of shares of its common stock having an aggregate offering price of up to $64,910,161 from time to time under Rule 415 under the Securities Act. On December 3, 2025, President Street provided a notice pursuant to the Sales Agreement to terminate its role as a sales agent, and Clear Street became the sole sales agent.

On March 3, 2026, the Company entered into an amended and restated sales agreement (the “Sales Agreement”), with Clear Street and Virtu Americas LLC (“Virtu”, and together with Clear Street, the “Sales Agents”), relating to the sale of shares of the Company’s common stock. The Sales Agreement amends and restates the Original Sales Agreement. Pursuant to the Sales Agreement, the aggregate gross sales price of Common Stock available for issuance under the Sales Agreement is $300,000,000, and such amount excludes the Common Stock previously sold under the Original Sales Agreement.

Management Changes

In connection with the adoption of the Company’s Digital Asset Treasury Strategy, Sireesh Appajosyula resigned as Chief Executive Officer, effective November 6, 2025. The Board of Directors (the “Board”) appointed Mark Wendland as Chief Executive Officer and Mark Toomey as President, effective the same date. Also on November 6, 2025, Nancy Davis and Sanam Parikh resigned as members of the Board, and Mr. Wendland was appointed to the Board. On December 10, 2025, the Board appointed Jacob Asbury as Chief Financial Officer, and Mr. Appajosyula resigned as Interim Chief Financial Officer, continuing his service as a director and as Chief Executive Officer of Gravitas Life Sciences, Inc., a subsidiary of the Company. At the shareholders meeting held on January 30, 2026, shareholders approved the election of Jill Sommers and William Wiley, to serve as directors. Concurrently with the election of these two director nominees, James Gordon Liddy resigned from the Board. On February 5, 2026, the Board appointed Angela Dominy Radkowski as Chief Operating Officer, Vincent LoPriore stepped down as Chairman and Mark Wendland was elected as the new Chairman.

Competition

We face different competition for our biotech research and development operations and our digital asset treasury.

The pharmaceutical and biotechnology industries are characterized by rapidly advancing technologies, intense competition, and a strong emphasis on proprietary products and intellectual property. We face competition from major multinational pharmaceutical companies, established biotechnology companies, specialty pharmaceutical companies, emerging and start-up companies, universities and other research institutions both in the United States and internationally. Any drug candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

Our digital asset strategy generally involves, from time to time and subject to market conditions, (i) issuing equity or debt securities or entering into other capital raising transactions with the objective of using the proceeds to acquire CC and other Canton Network–based digital assets and to fund validator, staking and network participation activities, and (ii) deploying excess liquid assets beyond working capital requirements into CC and related on-network positions. In pursuing this strategy, we compete for capital and asset acquisition opportunities with a range of market participants, including digital asset treasury companies, tokenization and real-world asset platforms digital asset investment vehicles and ETPs, private funds and venture-backed entities focused on blockchain infrastructure. Increased competition for investor capital, strategic allocations to network-native assets, validator slots, and high-quality on-network yield opportunities could increase our cost of capital, reduce the availability of attractive acquisition or participation opportunities, and adversely affect our ability to scale our digital asset treasury and Canton-based treasury activities, which in turn could negatively impact our operating results and the market price of our securities.

Manufacturing

We do not own or operate any facilities in which we can formulate or manufacture our product candidates. We intend to rely on contract manufacturers to produce all materials required to conduct pre-clinical studies and clinical trials under current good manufacturing practice (“cGMP”), with oversight of these activities by our management team. We have identified alternate sources of supply and other contract manufacturers that can produce materials for our pre-clinical and clinical trial requirements on a timely basis. However, if an existing or future contract manufacturer fails to deliver on schedule, or at all, it may delay or interrupt the development process for our product candidates, which may have an adverse effect on our operating results and estimated timelines.

Intellectual Property

We strive to protect the intellectual property that is available to us, including by obtaining, maintaining, defending, and enforcing patent protection in the United States and internationally. For our product candidates, generally we initially pursue patent protection covering compositions of matter, methods of production, and methods of use. Throughout the development of our product candidates and technologies, we will seek to identify additional means of obtaining patent protection.

Our patent portfolio includes four patent families with two issued U.S. patents and 14 pending applications related generally to transmucosal film compositions, treatment of pruritus, and treatment of opioid intoxication. The claims of these patents and applications cover devices and their method of manufacture, as well as methods of treating. Specifically, our patent portfolio currently includes two issued U.S. patents, one allowed U.S. patent application, two additional pending applications in the U.S., 5 issued patents abroad, and 10 pending applications abroad. Patent protection is expected to expire between 2039 and 2046, absent any applicable patent term adjustments or extensions. The term of individual patents depends upon the legal term for patents in the countries in which they are obtained. In most countries, including the U.S., the patent term is 20 years from the earliest filing date of a non-provisional patent application.

We also have issued patents and pending applications related generally to our polymeric nanoparticle technologies, methods of making our polymeric nanoparticle technologies, and methods of using our polymeric nanoparticles therapeutically (e.g., for delivery of therapeutic compounds). Patent protection for the earliest-filed family is expected to expire in 2033, absent any applicable patent term adjustments or extensions, with more recently filed families expiring approximately between 2033 and 2041.

We also entered into multiple research collaboration and license agreements to secure rights to technologies, patents, and know-how supporting development of its biologic and antibody-based product candidates. Under agreements with Minotaur Therapeutics, Inc., the Company obtained rights to certain technologies, to discover and develop targeted biologics against high-value immune-oncology targets, including PD-1. The Company also entered into a Research and Development Collaboration and License Agreement with Applied Biomedical Science Institute granting it an exclusive, sublicensable, royalty-bearing license to specified patents and a non-exclusive license to related know-how. Additional exclusive or sublicensable global licenses have been obtained from Avior, and Intract Pharma Limited. These agreements collectively provide the Company with development and commercialization rights, subject to field, territory, and diligence obligations, and are material to its intellectual property portfolio and product development strategy.

Government Regulations

Digital Assets and CC

The laws and regulations applicable to digital assets are evolving and subject to interpretation and change.

Governments around the world have reacted differently to digital assets; certain governments have deemed them illegal, and others have allowed their use and trade without restriction, while in some jurisdictions, such as the U.S., digital assets are subject to overlapping, uncertain and evolving regulatory requirements.

As digital assets have grown in both popularity and market size, the U.S. Executive Branch, Congress and a number of U.S. federal and state agencies, including the Financial Crimes Enforcement Network, the Commodity Futures Trading Commission (“CFTC”), the SEC, the Financial Industry Regulatory Authority, the Consumer Financial Protection Bureau, the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS and state financial regulators, have been examining the operations of digital asset networks, digital asset users and digital asset exchanges, with particular focus on the extent to which digital assets can be used to violate state or federal laws, including to facilitate the laundering of proceeds of illegal activities or the funding of criminal or terrorist enterprises, and the safety and soundness and consumer-protective safeguards of exchanges or other service-providers that hold, transfer, trade or exchange digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. In addition, federal and state agencies, and other countries have issued rules or guidance regarding the treatment of digital asset transactions and requirements for businesses engaged in activities related to digital assets.

Depending on the regulatory characterization of CC, the markets for CC in general, and our activities in particular, our business and our CC strategy may be subject to regulation by one or more regulators in the United States and globally. Ongoing and future regulatory actions may alter, to a materially adverse extent, the nature of digital assets markets, the participation of industry participants, including service providers and financial institutions in these markets, and our ability to pursue our digital asset strategy. Additionally, U.S. state and federal and foreign regulators and legislatures have taken action against industry participants, including digital assets businesses, and enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from digital assets activity. U.S. federal and state energy regulatory authorities are also monitoring the total electricity consumption of cryptocurrency mining, and the potential impacts of cryptocurrency mining to the supply and dispatch functionality of the wholesale grid and retail distribution systems. Many state legislative bodies have passed, or are actively considering, legislation to address the impact of cryptocurrency mining in their respective states.

The CFTC takes the position that some digital assets fall within the definition of a “commodity” under the Commodity Exchange Act of 1936, as amended (the “CEA”). Under the CEA, the CFTC has broad enforcement authority to police market manipulation and fraud in spot digital assets markets in which we may transact. Beyond instances of fraud or manipulation, the CFTC generally does not oversee cash or spot market exchanges or transactions involving digital asset commodities that do not utilize margin, leverage, or financing. In addition, CFTC regulations and CFTC oversight and enforcement authority apply with respect to futures, swaps, other derivative products and certain retail leveraged commodity transactions involving digital asset commodities, including the markets on which these products trade.

The SEC and its staff have taken the position that certain other digital assets fall within the definition of a “security” under the U.S. federal securities laws. Public statements made by senior officials and senior members of the staff at the SEC indicate that the SEC does not consider certain digital assets to be a security under the federal securities laws. However, such statements are not official policy statements by the SEC and reflect only the speakers’ views, which are not binding on the SEC or any other agency or court and cannot be generalized to any other digital assets.

In addition, since transactions in digital assets provide a degree of anonymity, they are susceptible to misuse for criminal activities, such as money laundering. This misuse, or the perception of such misuse, could lead to greater regulatory oversight of CC and the Canton Network, and there is the possibility that law enforcement agencies could close or blacklist CC platforms or other related infrastructure with little or no notice and prevent users from accessing or retrieving CC held via such platforms or infrastructure. For example, the U.S. Treasury Department’s Office of Foreign Assets Control has issued updated advisories regarding the use of virtual currencies, added a number of digital asset exchanges and service providers to the Specially Designated Nationals and Blocked Persons list and engaged in several enforcement actions, including a series of enforcement actions that have either shut down or significantly curtailed the operations of several smaller digital asset exchanges associated with Russian and/or North Korean nationals. Additionally, in January 2025, the Consumer Financial Protection Bureau announced that it is seeking public input on privacy protections and surveillance in digital payments, particularly those offered through large technology platforms.

Legislation is currently pending in the U.S. Congress which, if passed and signed into law, could significantly affect the digital currency and digital asset markets. One such piece of legislation is the Digital Asset Market Clarity Act of 2025 (“CLARITY Act”), which would clarify which digital currencies and digital assets are commodities, as opposed to securities. Additionally, the CLARITY Act would subject certain spot-market digital commodities to a comprehensive regulatory regime for the first time. For example, the legislation would require several different types of entities to register with the CFTC and/or SEC and comply with various regulatory requirements that would be promulgated by the CFTC and SEC. Further, the legislation would require issuers of new and “non-mature” digital commodities to make a mandatory filing with the SEC containing information regarding the issuer, planned use of proceeds, economics, governance and development roadmap. The details of the legislation are likely to change from its current form as it is reviewed and revised by the U.S. Congress, and it is unknown at this time whether it will be approved.

Biopharmaceutical

Governmental authorities in the U.S. and other countries extensively regulate the research, development, testing, manufacture, labeling, promotion, advertising, distribution and marketing of pharmaceutical products such as those being developed by us. In the U.S., the FDA regulates such products under the FDCA and its implementing regulations. Failure to comply with applicable FDA requirements, both before and after approval, may subject us to administrative and judicial sanctions, such as a delay in approving or refusal by the FDA to approve pending applications, warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions and/or criminal prosecution.

U.S. Food and Drug Administration Regulation

United States Drug Development

In the United States, the FDA regulates drugs, medical devices and combinations of drugs and devices, or combination products, under the FDCA and its implementing regulations. Drugs are also subject to other federal, state and local statutes and regulations. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations requires the expenditure of substantial time and financial resources. Failure to comply with the applicable U.S. requirements at any time during the product development process, approval process or after approval, may subject an applicant to administrative or judicial sanctions. These sanctions could include, among other actions, the FDA’s refusal to approve pending applications, withdrawal of an approval, a clinical hold, untitled or warning or untitled letters, requests for voluntary product recalls or withdrawals from the market, product seizures, total or partial suspension of production or distribution injunctions, fines, refusals of government contracts, restitution, disgorgement, or civil or criminal penalties. Any agency or judicial enforcement action could have a material adverse effect on us.

The process required by the FDA before a drug may be marketed in the United States generally involves the following:

Once a pharmaceutical product candidate is identified for development, it enters the pre-clinical testing stage. Pre-clinical tests include laboratory evaluations of product chemistry, toxicity, formulation and stability, as well as animal studies. An IND sponsor must submit the results of the pre-clinical tests, together with manufacturing information, analytical data and any available clinical data or literature, to the FDA as part of the IND. The sponsor must also include a protocol detailing, among other things, the objectives of the initial clinical trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated if the initial clinical trial lends itself to an efficacy evaluation. Some pre-clinical testing may continue even after the IND is submitted. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA raises concerns or questions related to a proposed clinical trial and places the trial on a clinical hold within that 30-day period. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. Clinical holds also may be imposed by the FDA at any time before or during clinical trials due to safety concerns or non-compliance and may be imposed on all drug products within a certain class of drugs. The FDA also can impose partial clinical holds, for example, prohibiting the initiation of clinical trials of a certain duration or for a certain dose.

All clinical trials must be conducted under the supervision of one or more qualified investigators in accordance with GCP regulations. These regulations include the requirement that all research subjects provide informed consent in writing before their participation in any clinical trial. Further, an IRB must review and approve the plan for any clinical trial before it commences at any institution, and the IRB must conduct continuing review and reapprove the study at least annually. An IRB considers, among other things, whether the risks to individuals participating in the clinical trial are minimized and are reasonable in relation to anticipated benefits. The IRB also approves the information regarding the clinical trial and the consent form that must be provided to each clinical trial subject or his or her legal representative and must monitor the clinical trial until completed.

Each new clinical protocol and any amendments to the protocol must be submitted for FDA review, and to the IRBs for approval. Protocols detail, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters to be used to monitor subject safety.

Human clinical trials are typically conducted in three sequential phases that may overlap or be combined:

Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are used to gain additional experience from the treatment of patients in the intended therapeutic indication. In certain instances, the FDA may mandate the performance of Phase 4 trials. Companies that conduct certain clinical trials also are required to register them and post the results of completed clinical trials on a government-sponsored database, www.clinicaltrials.gov, in the United States, within certain timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

Progress reports detailing the results of the clinical trials, among other information, must be submitted at least annually to the FDA, and written IND safety reports must be submitted to the FDA and the investigators for serious and unexpected adverse events, findings from other studies that suggest a significant risk to humans exposed to the product, findings from animal or in vitro testing that suggest a significant risk to human subjects, and any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, if at all. The FDA or the clinical trial sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the product has been associated with unexpected serious harm to patients. Additionally, some clinical trials are overseen by an independent group of qualified experts organized by the clinical trial sponsor, known as a data safety monitoring board or committee. This group provides authorization for whether a trial may move forward at designated check points based on access to certain data from the study. The clinical trial sponsor may also suspend or terminate a clinical trial based on evolving business objectives and/or competitive climate.

Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product and finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final product. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.

NDA and FDA Review Process

The results of product development, pre-clinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the drug, proposed labeling and other relevant information, are submitted to the FDA as part of an NDA, which request approval to market a new drug product. The submission of an NDA is subject to the payment of a substantial user fee, and the sponsor of an approved NDA is also subject to an annual program user fee; although a waiver of such fee may be obtained under certain limited circumstances. For example, the agency will waive the application fee for the first human drug application that a small business or its affiliate submits for review.

The FDA reviews all NDAs submitted before it accepts them for filing and may request additional information rather than accepting an NDA for filing. The FDA typically makes a decision on accepting an NDA for filing within 60 days of receipt. The decision to accept the NDA for filing means that the FDA has made a threshold determination that the application is sufficiently complete to permit a substantive review. Under the goals and policies agreed to by the FDA under the Prescription Drug User Fee Act (“PDUFA”), the FDA’s goal to complete its substantive review of a standard NDA and respond to the applicant is ten months from the receipt of the NDA. The FDA does not always meet its PDUFA goal dates, and the review process is often significantly extended by FDA requests for additional information or clarification and may go through multiple review cycles.

After the NDA submission is accepted for filing, the FDA reviews the NDA to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength, quality and purity. The FDA may refer applications for novel drug products or drug products that present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. The FDA will likely re-analyze the clinical trial data, which could result in extensive discussions between the FDA and us during the review process. The review and evaluation of an NDA by the FDA is extensive and time consuming and may take longer than originally planned to complete, and we may not receive a timely approval, if at all.

Before approving an NDA, the FDA will conduct a pre-approval inspection of the manufacturing facilities for the new product to determine whether they comply with cGMP. The FDA will not approve the product unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. In addition, before approving an NDA, the FDA may also audit data from clinical trials to ensure compliance with GCP requirements. After the FDA evaluates the application, manufacturing process and manufacturing facilities, it may issue an approval letter or a Complete Response Letter. An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications. A Complete Response Letter indicates that the review cycle of the application is complete and the application will not be approved in its present form. A Complete Response Letter describes specific deficiencies in the NDA identified by the FDA. The Complete Response Letter may require additional clinical data and/or an additional pivotal Phase 3 clinical trial(s), and/or other significant and time-consuming requirements related to clinical trials, nonclinical studies or manufacturing. If a Complete Response Letter is issued, the applicant may either resubmit the NDA, addressing all the deficiencies identified in the letter, or withdraw the application. Even if such data and information are submitted, the FDA may ultimately decide that the NDA does not satisfy the criteria for approval. Data obtained from clinical trials are not always conclusive, and the FDA may interpret data differently than we interpret the same data.

There is no assurance that the FDA will ultimately approve a product for marketing in the United States, and we may encounter significant difficulties or costs during the review process. If a product receives marketing approval, the approval may be significantly limited to specific diseases and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the product. Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling or may condition the approval of the NDA on other changes to the proposed labeling, development of adequate controls and specifications, or a commitment to conduct post-market testing or clinical trials and surveillance to monitor the effects of approved products. For example, the FDA may require Phase 4 clinical trials to further assess drug safety and effectiveness and may require testing and surveillance programs to monitor the safety of approved products that have been commercialized. The FDA may also place other conditions on approvals, including the requirement for a REMS to assure the safe use of the drug. If the FDA concludes a Risk Evaluation and Mitigation Strategy (“REMS”) is needed, the sponsor of the NDA must submit a proposed REMS; the FDA will not approve the NDA without an approved REMS, if required. A REMS could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools. Any of these limitations on approval or marketing could restrict the commercial promotion, distribution, prescription or dispensing of products. Product approvals may be withdrawn for non-compliance with regulatory requirements or if problems occur following initial marketing.

Orange Book Listing and Paragraph IV Certification

For NDA submissions, including those under Section 505(b)(2), applicants are required to list with the FDA certain patents with claims that cover the applicant’s product. Upon approval, each of the patents listed in the application is published in Approved Drug Products with Therapeutic Equivalence Evaluations, commonly referred to as the Orange Book. Any applicant who subsequently files an abbreviated new drug application (“ANDA”) or 505(b)(2) NDA that references a drug listed in the Orange Book must certify to the FDA that (1) no patent information on the drug product that is the subject of the application has been submitted to the FDA; (2) such patent has expired; (3) the date on which such patent expires; or (4) such patent is invalid or will not be infringed upon by the manufacture, use or sale of the drug product for which the application is submitted. This last certification is known as a Paragraph IV Certification.

If an applicant has provided a Paragraph IV Certification to the FDA, the applicant must also send notice of the Paragraph IV Certification to the holder of the NDA for the approved drug and the patent owner once the application has been accepted for filing by the FDA. The NDA holder or patent owner may then initiate a patent infringement lawsuit in response to notice of the Paragraph IV Certification. The filing of a patent infringement lawsuit within 45 days of the receipt of a Paragraph IV Certification prevents the FDA from approving the ANDA or 505(b)(2) application until the earlier of 30 months from the date of the lawsuit, the applicant’s successful defense of the suit, or expiration of the patent.

Employees

We currently employ 12 full-time employees. We are not a party to any collective bargaining agreements, and we believe that we maintain good relations with our employees.

Our human capital resources objectives include identifying, recruiting, retaining and incentivizing our existing and future employees. The principal purposes of our equity incentive plans are to attract, retain and motivate selected employees, consultants and directors through granting of equity-based compensation awards and cash-based compensation awards, in order to increase stockholder value and support success of our company by motivating such individuals to perform to the best of their abilities and achieve our objectives.

Facilities

Our corporate headquarters are located at 34 Shrewsbury Ave, Suite 1C, Red Bank, NJ, 07701.

Legal Proceedings

From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.

Our Corporate History

We were incorporated under the laws of the State of Delaware on March 28, 2017 under the name Hillstream BioPharma Inc. (“HBI”). On July 16, 2019, Hillstream BioPharma Holdings, Inc. (“Holdco”) was formed as a Delaware C-corporation. On July 24, 2019, Holdco entered into a Contribution and Exchange Agreement with Nanoproteagen LLC (“Nanoproteagen”) whereby the members of Nanoproteagen exchanged 100% of their membership interests in Nanoproteagen for shares of Holdco common stock. Also on July 24, 2019, the stockholders of HBI exchanged 100% of their shares of common stock for shares of common stock of Holdco. HBI and Nanoproteagen became wholly-owned subsidiaries of Holdco. On August 7, 2019, pursuant to a certificate of amendment, Holdco’s name was changed to Hillstream BioPharma, Inc. and HBI’s name was changed to HB Pharma Corp. On November 12, 2020, Hillstream BioPharma, Inc. entered into a Share Exchange Agreement with Farrington Therapeutics LLC (“Farrington”), whereby the members of Farrington exchanged their membership interest in Farrington for shares of common stock of Hillstream BioPharma, Inc., and Farrington became a wholly-owned subsidiary of Hillstream BioPharma, Inc. On September 21, 2023, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of the State of Delaware pursuant to which it changed its name to Tharimmune, Inc. effective as of September 25, 2023.

On November 17, 2023, we filed a Certificate of Amendment to our Certificate of Incorporation, as amended, with the Delaware Secretary of State to effectuate a 1-for-25 reverse stock split of our issued and outstanding shares of common stock. The reverse stock split became effective at 4:01 p.m. Eastern time on November 20, 2023. All share data, per share data, and related information contained in this Annual Report on Form 10-K has been retrospectively adjusted to reflect the effect of the reverse stock split.

On May 22, 2024, we filed a Certificate of Amendment to our Certificate of Incorporation, as amended, with the Delaware Secretary of State to effectuate a 1-for-15 reverse stock split of our issued and outstanding shares of common stock. The reverse stock split became effective at 4:01 p.m. Eastern time on May 24, 2024. All share data, per share data, and related information contained in this Annual Report on Form 10-K has been retrospectively adjusted to reflect the effect of the reverse stock split.

On February 18, 2026, we changed our name to Canton Strategic Holdings, Inc., pursuant to an amended and restated Certificate of Incorporation filed with the Delaware Secretary of State, effective at 12:01 a.m. Eastern time on February 18, 2026.

Available Information

Our website address is www.cantonstrategic.com. The contents of, or information accessible through, our website are not part of this Annual Report on Form 10-K, and our website address is included in this document as an inactive textual reference only. We make our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports, available free of charge on our website as soon as reasonably practicable after we file such reports with, or furnish such reports to, the SEC. The SEC maintains a public website at www.sec.gov containing such filings.

ITEM 1A. RISK FACTORS

An investment in our common stock involves a high degree of risk. You should carefully consider the following risk factors and the other information in this Annual Report on Form 10-K before investing in our common stock. Our business and results of operations could be seriously harmed by any of the following risks. The risks set out below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. If any of the following events occur, our business, financial condition and results of operations could be materially adversely affected. In such case, the value and trading price of our common stock could decline, and you may lose all or part of your investment.

Risks Related to Our CC Strategy and Holdings

We are shifting our business strategy from biotechnology operations to a CC treasury strategy, which represents a fundamental change in our risk profile and may not be successful.

Historically, our company’s core operations centered on biotechnological solutions. In late 2025, we began to integrate digital asset management into our business, but this was not our primary focus. In February 2026, we rebranded as Canton Strategic Holdings, Inc. to reflect our new emphasis on acquiring, holding, and managing CC assets as our principal treasury and operational strategy. This pivot presents several material risks:

If we are unable to effectively manage these risks and execute our new strategy, our business, financial condition, and the market price of our common stock could be materially and adversely affected.

We may be subject to regulatory developments related to crypto assets and crypto asset markets, which could adversely affect our business, financial condition, and results of operations.

As CC and other digital assets are relatively novel and the application of state and federal securities laws and other laws and regulations to digital assets is unclear in certain respects, it is possible that regulators in the United States or foreign countries may interpret or apply existing laws and regulations in a manner that adversely affects the price of CC. The application of state and federal securities laws and other laws and regulations to CC and other digital assets is unclear in certain respects. The U.S. federal government, states, regulatory agencies, and foreign countries may also enact new laws and regulations, or pursue regulatory, legislative, enforcement or judicial actions, that could materially impact the price of CC or the ability of individuals or institutions such as us to own or transfer CC.

Since 2018, the SEC has initiated a number of crypto and digital-asset-related enforcement actions. While the SEC has since requested the dismissal of several of these cases, the SEC or other regulatory agencies may initiate similar actions in the future, which could materially impact the price of CC. In January 2025, the SEC launched a crypto task force dedicated to developing a comprehensive and clear regulatory framework for crypto assets. Since then, the task force has sought written input and hosted roundtables with market participants to further task force goals of drawing clear regulatory lines, providing paths to registration, crafting disclosure frameworks, and deploying enforcement resources judiciously. We cannot predict the output of the new crypto task force or whether any recommendations will be adopted by the SEC or maintained under future administrations.

It is not possible to predict whether, or when, new laws will be enacted that change the legal framework governing digital assets or provide additional authorities to the SEC or other regulators, or whether, or when, any other federal, state or foreign legislative bodies will take any similar actions. It is also not possible to predict the nature of any such additional laws or authorities, how additional legislation or regulatory oversight might impact the ability of digital asset markets to function, the willingness of financial and other institutions to continue to provide services to the digital assets industry, or how any new laws or regulations, or changes to existing laws or regulations, might impact the value of digital assets generally and CC tokens specifically. The consequences of any new law or regulation relating to digital assets and digital asset activities could adversely affect the market price of CC tokens, as well as our ability to hold or transact in CC tokens, and in turn adversely affect the market price of our listed securities.

If CC is determined to constitute a security for purposes of the federal securities laws, the additional regulatory restrictions imposed by such a determination could adversely affect the market price of CC and in turn adversely affect the market price of our common stock.

Our digital asset treasury exposure to CC involves novel and significant risks, including market volatility, accounting, regulatory, custody, cybersecurity, liquidity and reputational risks, which could have a material adverse effect on our business, results of operations and financial condition.

We have implemented a digital asset treasury strategy by holding our treasury assets in CC, a privately issued digital asset that is not legal tender and is not backed or insured by any government or governmental program. The market for CC may be less mature than markets for traditional assets and can exhibit extreme price volatility driven by factors beyond our control, including market sentiment, macroeconomic conditions, regulatory developments, protocol or governance changes, technological vulnerabilities and the actions of significant market participants. These price movements could result in substantial realized and unrealized gains or losses. Under applicable U.S. GAAP, crypto assets that meet the relevant criteria are measured at fair value each reporting period with changes recognized in earnings, which can produce meaningful volatility in our reported results and adversely affect the market price of our securities.

Our CC activities depend on third-party service providers-such as trading venues, custodians, wallet-infrastructure vendors and banking or payment partners-over which we have limited control. Failures or outages at these providers, trading suspensions or delistings, withdrawal moratoria, insolvencies, hacking, fraud, operational errors, inadequate asset segregation or adverse legal determinations could lead to the partial or total loss of CC, delays or an inability to access or deploy CC, or disputes regarding ownership and control. Safeguarding the private keys necessary to access and transfer CC presents unique cybersecurity and internal-control challenges; loss, theft or compromise of keys-through cyberattack, insider malfeasance, software defects, misconfiguration, phishing or social engineering-may be irreversible.

The legal and regulatory framework for digital assets, including CC, continues to evolve and may be subject to inconsistent interpretation across U.S. federal, state and international jurisdictions. Authorities could determine that CC is a security, commodity or other regulated instrument, which could impose registration, licensing, disclosure, custody, capital or other obligations. Changes in, or differing interpretations of, securities, commodities, money-transmission, sanctions/AML, consumer-protection, tax and data-security laws and regulations could increase our compliance costs, restrict or prohibit aspects of our CC activities, limit access to fiat banking or payment rails, or subject us to examinations, enforcement actions, penalties or private litigation.

Liquidity in markets for CC may be limited or impaired during periods of stress due to exchange outages, extreme volatility, order-book dislocations, widening spreads and slippage, or adverse developments in related market infrastructure (including stablecoins and key service providers). If we seek to sell, transfer or hedge CC during such periods, we may be unable to do so on acceptable terms, or at all. Our holdings may also be concentrated in CC, increasing our exposure to idiosyncratic risks and potentially causing our stock price to correlate with movements in the price of CC.

Allocating cash, offering proceeds or debt financing to acquire or hold CC could affect our capital needs and financing plans, increase dilution or leverage, and subject us to covenant constraints. In addition, certain stakeholders may view digital-asset exposure unfavorably-whether due to environmental, social or governance concerns, perceived risk or other reasons-which could impair our reputation and access to capital, customers and partners. We may modify, suspend or discontinue our CC activities at any time, and there can be no assurance that our digital asset treasury strategy will achieve its objectives or that losses will not occur.

Failure of the Canton Network to achieve broad market acceptance would materially and adversely affect our business, financial condition, and results of operations.

Our business depends on the growth and widespread adoption of the Canton Network by major financial institutions and market infrastructure participants. Any failure of the Canton Network to achieve broad institutional acceptance would materially and adversely affect our business, financial condition, and results of operations.

The Canton Network is a relatively new technology, and its long-term viability and acceptance in the financial services industry remain uncertain. Unlike open, public cryptocurrencies, CC tokens and the Canton Network are designed for permissioned, compliance-oriented institutional usage. Canton Network infrastructure emphasizes configurable privacy, identity-aware access, regulatory controls, and interoperability between applications operated by known financial entities. While these features are attractive to regulated institutions, they also mean that adoption depends on formal onboarding, institutional alignment, and integration with existing financial systems, each of which can slow network growth and increase adoption risk compared to public, permissionless networks.

In addition, because CC tokens differ in design and purpose from established public coins, they do not benefit from the same level of public awareness, liquidity history, or market-driven network effects. Their value proposition is tied more directly to enterprise usage, transaction volume, and institutional trust frameworks. If institutions do not recognize sufficient operational, capital efficiency, or risk-reduction benefits from Canton-based assets compared to existing payment rails, bank money, stablecoins, or public blockchain assets, adoption may be limited.

Our digital treasury strategy is built to operate on, interoperate with, or derive value from activity on the Canton Network. If the Canton Network does not achieve broad adoption among institutional participants, or if adoption occurs more slowly than we anticipate, our profitability and results of operations could be adversely impacted.

Regulatory change reclassifying CC as a security could lead to our classification as an “investment company” under the Investment Company Act of 1940, as amended, or the 1940 Act, and could adversely affect the market price of CC and the market price of our common stock.

Under Sections 3(a)(1)(A) and (C) of the 1940 Act, a company generally will be deemed to be an “investment company” for purposes of the 1940 Act if (i) it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities or (ii) it engages, or proposes to engage, in the business of investing, reinvesting, owning, holding or trading in securities and it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. We do not believe that we are an “investment company,” as such term is defined in the 1940 Act, and are not registered as an “investment company” under the 1940 Act as of the date hereof.

While senior SEC officials have not stated their view as to whether CC is or is not a “security” for purposes of the federal securities laws, a contrary determination by the SEC could lead to our classification as an “investment company” under the 1940 Act, if the portion of our assets consists of investments in CC exceeds 40% safe harbor limits prescribed in the 1940 Act, which would subject us to significant additional regulatory controls that could have a material adverse effect on our business and operations and may also require us to change the manner in which we conduct our business.

We monitor our assets and income for compliance under the 1940 Act and seek to conduct our business activities in a manner such that we do not fall within its definitions of “investment company” or that we qualify under one of the exemptions or exclusions provided by the 1940 Act and corresponding SEC regulations. Furthermore, if CC is determined to constitute a security for purposes of the federal securities laws, we would take steps to reduce the percentage of CC that constitute investment assets under the 1940 Act. These steps may include, among others, selling CC that we might otherwise hold for the long term and deploying our cash in non-investment assets, and we may be forced to sell our CC at unattractive prices. We may also seek to acquire additional non-investment assets to maintain compliance with the 1940 Act, and we may need to incur debt, issue additional equity or enter into other financing arrangements that are not otherwise attractive to our business. Any of these actions could have a material adverse effect on our results of operations and financial condition. Moreover, we can make no assurance that we would successfully be able to take the necessary steps to avoid being deemed to be an investment company in accordance with the safe harbor. If we were unsuccessful, and if CC is determined to constitute a security for purposes of the federal securities laws, then we would have to register as an investment company, and the additional regulatory restrictions imposed by 1940 Act could adversely affect the market price of CC and in turn adversely affect the market price of our common stock.

Our financial results and the market price of our common stock may be affected by the prices of CC.

As part of our capital allocation strategy for assets that are not required to provide working capital for our ongoing operations, we have invested, and plan to continue to invest, in CC. The price of CC has historically been subject to dramatic price fluctuations and is highly volatile. Moreover, digital assets, such as CC, are relatively novel and the application of securities laws and other regulations to such assets is unclear in many respects. It is possible that regulators may interpret laws in a manner that adversely affects the liquidity or value of CC.

Any decrease in the fair value of CC below our carrying value for such assets could require us to incur a loss due to the decrease in fair market value, and such charge could be material to our financial results for the applicable reporting period, which may create significant volatility in our reported earnings. Any decrease in reported earnings or increased volatility of such earnings could have a material adverse effect on the market price of our common stock. In addition, the application of generally accepted accounting principles in the United States, with respect to CC, may change in the future and could have a material adverse effect on our financial results and the market price of our common stock.

In addition, if investors view the value of our common stock as dependent upon or linked to the value or change in the value of our CC holdings, the price of CC may significantly influence the market price of our common stock. Additionally, if the price of CC falls, and our common stock price falls as a result, then certain notes may not be converted and we may, in certain situations, need to repay them in cash. To the extent the value of the notes exceeds the value of the CC held as collateral, we may need to obtain additional financing, which might not be available on satisfactory terms, or at all. Any deficiency could substantially exceed the value of our other assets and could be many multiples of our historical earnings.

The concentration of CC ownership could increase the risk of malicious activity, including potential attacks on the Canton Network.

While CC was designed as a digital asset with no pre-allocation to founders or venture capital firms, the initial distribution of CC is intrinsically linked to network utility and participation. Therefore, a significant portion of the outstanding supply of Canton Coin may be held by a limited number of participants, such as founding members, early adopters, consortium participants, or affiliated entities. In addition, the Canton Network is designed as a permissioned or selectively permissioned distributed ledger in which transaction validation and block finalization are performed by approved validator nodes rather than an open mining community. Tokens and control over network validation may be concentrated in a relatively small group of participants.

In addition, because transactions on the CC network are generally measured in fiat terms and converted into CC using exchange rates or pricing quotes generated or approved through system mechanisms, validators, super validators, or other designated participants may have significant influence over the pricing inputs used for transaction settlement and fee calculations. If a malicious actor or group of actors (whether through conflict of interest, error, inadequate controls, or collusive or manipulative conduct) publish or rely on inaccurate, stale, or biased quotes, they may be able to exert control over the conversion rates, which may result in inflated effective transaction costs, inconsistent settlement outcomes, or opportunities for arbitrage that disadvantage network users and token holders.

We face risks relating to the custody of our CC tokens, including the loss or destruction of private keys required to access our CC tokens and cyberattacks or other data loss relating to our CC tokens, including smart contract related losses and vulnerabilities.

We hold our CC tokens with qualified custodians. We custody our CC tokens across multiple custodians to diversify our potential risk exposure to any one custodian. However, multiple custodians may utilize similar wallet infrastructure, cloud service providers or software systems, which could increase systemic technology risk.

If there is a decrease in the availability of digital asset custodians that we believe can safely custody our CC tokens, for example, due to regulatory developments or enforcement actions that cause custodians to discontinue or limit their services in the United States, we may need to enter into agreements that are less favorable than our current agreements or take other measures to custody our CC tokens, and our ability to seek a greater degree of diversification in the use of custodial services would be materially adversely affected. While we will conduct due diligence on our custodians and any smart contract platforms we may use, there can be no assurance that such diligence will uncover all risks, including operational deficiencies, hidden vulnerabilities or legal noncompliance.

Currently, the insurance that covers losses of our CC holdings may cover none or only a small fraction of the value of the entirety of our CC holdings, and there can be no guarantee that such insurance will be maintained as part of the custodial services we have or that such coverage will cover losses with respect to our CC. Moreover, our use of custodians exposes us to the risk that the CC our custodians hold on our behalf could be subject to insolvency proceedings and we could be treated as a general unsecured creditor of the custodian, inhibiting our ability to exercise ownership rights with respect to such CC. Any loss associated with such insolvency proceedings is unlikely to be covered by any insurance coverage we maintain related to our CC. The legal framework governing digital asset ownership and rights in custodial or insolvency contexts remains uncertain and continues to evolve, which could result in unexpected losses, protracted recovery processes or adverse treatment in insolvency proceedings.

CC tokens are controllable only by the possessor of both the unique public key and private key(s) relating to the local or online digital wallet in which the CC is held. While the CC blockchain ledger requires a public key relating to a digital wallet to be published when used in a transaction, private keys must be safeguarded and kept private in order to prevent a third party from accessing the CC held in such wallet. To the extent the private key(s) for a digital wallet are lost, destroyed, or otherwise compromised and no backup of the private key(s) is accessible, neither we nor our custodians will be able to access the CC held in the related digital wallet. Furthermore, we cannot provide assurance that our digital wallets, nor the digital wallets of our custodians held on our behalf, will not be compromised as a result of a cyberattack. The CC and blockchain ledger, as well as other digital assets and blockchain technologies, have been, and may in the future be, subject to security breaches, cyberattacks, or other malicious activities.

As part of our treasury management strategy, we may engage in staking, restaking, or other permitted activities that involve the use of “smart contracts” or decentralized applications. The use of smart contracts or decentralized applications entails certain risks including risks stemming from the existence of an “admin key” or coding flaws that could be exploited, potentially allowing a bad actor to issue or otherwise compromise the smart contract or decentralized application, potentially leading to a loss of our CC tokens. Like all software code, smart contracts are exposed to risk that the code contains a bug or other security vulnerability, which can lead to loss of assets that are held on or transacted through the contract or decentralized application. Smart contracts and decentralized applications may contain bugs, security vulnerabilities or poorly designed permission structures that could result in the irreversible loss of CC tokens or other digital assets. Exploits, including those stemming from admin key misuse, admin key compromise, or protocol flaws, have occurred in the past and may occur in the future.

We will operate in a highly competitive environment and will compete against companies and other entities with similar strategies, including companies with significant CC holdings and spot exchange traded funds and spot ETPs for digital assets.

The market for companies and investment vehicles focused on digital assets is intensely competitive and rapidly evolving. Even though CC is a relatively new digital asset, we will face competition from a variety of sources, including other public companies with significant CC holdings, as well as spot exchange traded funds and spot ETPs that provide investors with exposure to digital assets. Many of these competitors may have greater financial resources, more established operating histories, broader access to capital markets, and more extensive relationships with key market participants. In addition, the entry of new competitors, including large financial institutions and technology companies, could further intensify competition. If we are unable to effectively differentiate our business model, attract and retain investors, or respond to competitive pressures, our business, operating results, and financial condition could be materially and adversely affected. Increased competition may also lead to downward pressure on the market price of our stock and could impair our ability to achieve our strategic objectives.

The availability of spot ETPs for CC and other digital assets may adversely affect the market price of our listed securities.

Given the relative novelty of CC and digital assets, the selective nature of the Canton Network and lack of familiarity with the processes needed to hold CC directly, investors may seek exposure to CC through investment vehicles that hold CC and issue shares representing fractional undivided interests in their underlying CC holdings. These vehicles, which were previously offered only to “accredited investors” on a private placement basis, have in the past traded at substantial premiums to net asset value, possibly due to the relative scarcity of traditional investment vehicles providing investment exposure to CC.

To the extent investors view our common stock as providing exposure to CC, it is possible that the value of our common stock may also have included a premium over the value of our CC due to the prior scarcity of traditional investment vehicles providing investment exposure to CC, and that the value of our common stock may decline due to investors having a greater range of options to gain exposure to CC and investors choosing to gain such exposure through ETPs rather than our common stock. Additionally, on May 23, 2024, the SEC approved rule changes permitting the listing and trading of spot ETPs that invest in ether, the main crypto asset supporting the Ethereum blockchain. The approved spot ETPs commenced trading directly to the public on July 23, 2024. The listing and trading of spot ETPs for ether offers investors another alternative to gain exposure to digital assets, which could result in a decline in the trading price of CC as well as a decline in the value of our common stock relative to the value of our CC.

Although we are an operating company, and we believe we offer a different value proposition than a CC investment vehicle such as a spot CC ETP, investors may nevertheless view our common stock as an alternative to an investment in an ETP, and choose to purchase shares of a spot CC ETP instead of our common stock. They may do so for a variety of reasons, including if they believe that ETPs offer a “pure play” exposure to CC that is generally not subject to federal income tax at the entity level as we are, or the other risk factors applicable to an operating business, such as ours. Additionally, unlike spot CC ETPs, we (i) do not seek for our shares of common stock to track the value of the underlying CC we hold before payment of expenses and liabilities, (ii) do not benefit from various exemptions and relief under the Exchange Act, as amended, including Regulation M, and other securities laws, which enable ETPs to continuously align the value of their shares to the price of the underlying assets they hold through share creation and redemption, (iii) are a Delaware corporation rather than a statutory trust, and do not operate pursuant to a trust agreement that would require us to pursue one or more stated investment objectives, and (iv) are not required to provide daily transparency as to our CC holdings or our daily net asset value. Furthermore, recommendations by broker-dealers to buy, hold, or sell complex products and non-traditional ETPs, or an investment strategy involving such products, may be subject to additional or heightened scrutiny that would not be applicable to broker-dealers making recommendations with respect to our common stock. Based on how we are viewed in the market relative to ETPs, and other vehicles which offer economic exposure to CC, any premium or discount in our common stock relative to the value of our CC holdings may increase or decrease in different market conditions.

As a result of the foregoing factors, availability of spot ETPs for CC and other digital assets could have a material adverse effect on the market price of our listed securities.

If we or our third-party service providers experience a security breach or cyberattack and unauthorized parties obtain access to our CC, or if our private keys are lost or destroyed, or other similar circumstances or events occur, we may lose some or all of our CC and our financial condition and results of operations could be materially adversely affected.

Substantially all of the CC we own is held in custody accounts at U.S.-based institutional-grade digital asset custodians. Security breaches and cyberattacks are of particular concern with respect to our CC. CC and other blockchain-based cryptocurrencies and the entities that provide services to participants in the CC ecosystem have been, and may in the future be, subject to security breaches, cyberattacks, or other malicious activities. For example, in October 2021 it was reported that hackers exploited a flaw in the account recovery process and stole from the accounts of at least 6,000 customers of the Coinbase exchange, although the flaw was subsequently fixed and Coinbase reimbursed affected customers. Similarly, in November 2022, hackers exploited weaknesses in the security architecture of the FTX Trading digital asset exchange and reportedly stole over $400 million in digital assets from customers. A successful security breach or cyberattack could result in:

Further, any actual or perceived data security breach or cybersecurity attack directed at other companies with digital assets or companies that operate digital asset networks, regardless of whether we are directly impacted, could lead to a general loss of confidence in the broader CC ecosystem or in the use of the CC network to conduct financial transactions, which could negatively impact the market price of CC and in turn negatively impact our financial condition and results of operations and the market price of our common stock.

Attacks upon systems across a variety of industries, including industries related to CC, are increasing in frequency, persistence, and sophistication, and, in many cases, are being conducted by sophisticated, well-funded and organized groups and individuals, including state actors. The techniques used to obtain unauthorized, improper or illegal access to systems and information (including personal data and digital assets), disable or degrade services, or sabotage systems are constantly evolving, may be difficult to detect quickly, and often are not recognized or detected until after they have been launched against a target. These attacks may occur on our systems or those of our third-party service providers or partners. We may experience breaches of our security measures due to human error, malfeasance, insider threats, system errors or vulnerabilities or other irregularities. In particular, we expect that unauthorized parties will attempt to gain access to our systems and facilities, as well as those of our partners and third-party service providers, through various means, such as hacking, social engineering, phishing and fraud. Threats can come from a variety of sources, including criminal hackers, hacktivists, state-sponsored intrusions, industrial espionage, and insiders. In addition, certain types of attacks could harm us even if our systems are left undisturbed. For example, certain threats are designed to remain dormant or undetectable, sometimes for extended periods of time, or until launched against a target and we may not be able to implement adequate preventative measures. Further, there has been an increase in such activities due to the increase in work-from-home arrangements. The risk of cyberattacks could also be increased by cyberwarfare in connection with ongoing or future armed conflicts, including potential proliferation of malware into systems unrelated to such conflicts. Any future breach of our operations or those of others in the CC industry, including third-party services on which we rely, could materially and adversely affect our financial condition and results of operations.

We face other risks related to our CC digital asset treasury reserve business model.

Our CC treasury reserve business model exposes us to various risks, including the following:

The foregoing factors could lead to disruption in the market for CC, which could adversely affect the market price of CC and in turn adversely affect the market price of our common stock.

Negative developments in the cryptocurrency industry — including fraud, cybercrime or platform failures — may result in unfavorable publicity and could impact investor sentiment with respect to us even if we are not directly involved in any of the reported events.

The cryptocurrency industry has been subject to a number of high-profile negative developments, including instances of fraud, theft, cyberattacks, regulatory enforcement actions, and failures or insolvencies of major trading platforms and custodians. Even if we are not directly involved in or affected by such events, negative publicity and heightened scrutiny of the cryptocurrency industry as a whole could adversely impact investor sentiment toward companies with significant exposure to digital assets, including us. For example, reports of security breaches, mismanagement, or criminal activity at other cryptocurrency companies or exchanges may lead to increased concerns about the safety and legitimacy of digital assets generally, which could result in reduced demand for our stock, increased volatility in its share price, and greater difficulty in raising capital or maintaining business relationships. In addition, negative industry developments may prompt regulatory authorities to impose stricter requirements or oversight, which could increase our compliance costs and operational risks. The perception of heightened risk in the cryptocurrency sector, regardless of our actual involvement or risk profile, could therefore have a material adverse effect on our reputation, business, financial condition, and results of operations.

Our CC holdings are and will be less liquid than our existing cash and cash equivalents and may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents.

Historically, the crypto market has been characterized by significant volatility in price, limited liquidity and trading volumes compared to sovereign currencies markets, relative anonymity, a developing regulatory landscape, potential susceptibility to market abuse and manipulation, compliance and internal control failures at exchanges, and various other risks inherent in its entirely electronic, virtual form and decentralized network. During times of market instability, we may not be able to sell our CC at favorable prices or at all. For example, a number of digital asset trading venues temporarily halted deposits and withdrawals in 2022, although Coinbase has, to date, not done so. As a result, our CC holdings may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents. Further, CC we hold with our custodians and transact with our trade execution partners will not enjoy the same protections as are available to cash or securities deposited with or transacted by institutions subject to regulation by the Federal Deposit Insurance Corporation or the Securities Investor Protection Corporation. Additionally, we may be unable to enter into term loans or other capital raising transactions collateralized by our unencumbered CC or otherwise generate funds using our CC holdings, including in particular during times of market instability or when the price of CC tokens has declined significantly. If we are unable to sell our CC, enter into additional capital raising transactions, including capital raising transactions using CC as collateral, or otherwise generate funds using our CC holdings, or if we are forced to sell our CC at a significant loss, in order to meet our working capital requirements, our business and financial condition could be negatively impacted.

If we elect to use derivative instruments to hedge the price risk of holding CC, such derivatives are highly volatile and subject to market and liquidity risks, which could negatively impact our digital asset treasury strategy.

We may invest and trade in a variety of derivative instruments to hedge the price risk associated with CC. Derivatives, such as futures and swaps, are financial instruments or arrangements in which the risk and return are related to changes in the value of other assets, reference rates or indices. These instruments are highly volatile and expose investors to a high risk of loss. The low initial margin deposits normally required to establish a position in such instruments permit a high degree of leverage. As a result, depending on the type of instrument, a relatively small movement in the price of a contract may result in a profit or a loss which is high in proportion to the amount of funds actually placed as initial margin and may result in unquantifiable further loss exceeding any margin deposited. Our ability to profit or avoid risk through investment or trading in derivatives will depend on our ability to anticipate changes in the underlying assets, reference rates or indices. Engaging in hedging may result in poorer overall performance for us than we could have achieved had we not engaged in such hedging transactions. In addition, although we may utilize a variety of instruments, including options and other derivatives, for hedging and risk management purposes, we are not obligated to, and may not, hedge against certain risks. Furthermore, our portfolio may be exposed to risks that cannot be hedged. Use of hedging and risk management products may also increase our regulatory burden and costs of compliance.

We will be exposed to the default risk of our clearing broker if we hedge the price risk of CC through the purchase of futures contracts.

If we use a clearing broker to help manage financial transactions — such as buying or selling CC futures contracts to hedge against CC price swings — then we will be exposed to the clearing broker’s credit risk. Under the CEA and CFTC regulations, futures contracts must be cleared through a clearing broker known as a registered futures commission merchant (“FCM”). FCMs hold a certain amount of the customer collateral that customers deposit in connection with their futures trading, and are responsible for posting that collateral to the clearinghouse on the customer’s behalf when the clearinghouse issues a margin call. FCMs are required to maintain such collateral and all customer assets in a segregated account. If the FCM fails to do so, or is unable to satisfy a substantial deficit in a customer account, its customers (including us) may be subject to risk of loss of their funds in the event of the FCM’s insolvency. In such event, under the current U.S. Bankruptcy Code, the FCM’s customers (including us) are entitled to recover only a proportional share of all property available for distribution to all of that FCM’s customers. We may therefore be exposed to material losses in the event of an FCM’s or fellow FCM customer’s default or insolvency.

We face risks relating to the use of third-party exchanges in connection with our CC strategy.

We intend to use third-party exchanges, which we believe are reputable, such as Kraken, Anchorage and Coinbase, to purchase CC tokens for our treasury. As part of our process in determining transactions with third-party exchanges, we search for reputable exchanges that have industry standard policies and procedures in place regarding data security and customer diligence related to anti-money laundering, Office of Foreign Assets Control and know-your customer rules and regulations. If any of these third-party exchanges no longer meet our standards or if there is a decrease in reputable third-party exchanges, we may need to find additional counterparties and enter into additional agreements that could be on less favorable terms, which could have a material adverse effect on our business, financial condition or the results of our operations.

Future developments regarding the treatment of crypto assets for U.S. and foreign tax purposes could adversely impact our business.

The tax treatment of CC and other digital assets is subject to significant uncertainty and evolving guidance from U.S. federal, state, and local tax authorities, as well as foreign tax authorities. Changes in tax laws, regulations, or interpretations could have a material impact on our business, including our ability to acquire, hold, or dispose of CC tokens in a tax-efficient manner. For example, future legislation or regulatory guidance could result in the imposition of new or increased taxes on the acquisition, holding, or transfer of CC tokens, or could require us to report additional information to tax authorities. In addition, differences in the tax treatment of digital assets across jurisdictions could create compliance challenges and increase our administrative and operational costs. Any adverse developments in the tax treatment of digital assets could reduce the attractiveness of our business model, increase our tax liabilities, and negatively affect our financial results and the value of our stock.

We are not subject to legal and regulatory obligations that apply to investment companies such as mutual funds and exchange-traded funds, or to obligations applicable to investment advisers.

Mutual funds, ETFs and their directors and management are subject to extensive regulation as “investment companies” and “investment advisers” under U.S. federal and state law; this regulation is intended for the benefit and protection of investors. We are not subject to, and do not otherwise voluntarily comply with, these laws and regulations. This means, among other things, that the execution of or changes to our CC strategy, our use of leverage, the manner in which our CC tokens are custodied, our ability to engage in transactions with affiliated parties and our operating and investment activities generally are not subject to the extensive legal and regulatory requirements and prohibitions that apply to investment companies and investment advisers. Our board of directors has broad discretion over the investment, leverage and cash management policies it authorizes, whether in respect of our CC token holdings or other activities we may pursue, and has the power to change our current policies, including our strategy of acquiring and holding CC tokens.

Risks Related to Our Therapeutic Candidates Developments

We are substantially dependent on the success of our product candidates. If we are unable to complete development of, obtain approval for, or successfully commercialize our product candidates, our business may be harmed.

Our future success depends on our ability to complete clinical trials, obtain marketing approval, and successfully commercialize our product candidates. We currently have no approved products, and may never generate sufficient revenue to achieve profitability. The clinical and commercial success of our product candidates depends on numerous factors beyond our control, which could cause significant delays or prevent regulatory approvals or commercialization.

Our pipeline is based on novel ideas and technologies that are unproven and may not result in marketable products, which exposes us to unforeseen risks and makes it difficult to predict development timelines, costs, and regulatory approval.

We are developing product candidates using novel approaches to treat rare diseases, inflammatory disorders, and cancer. Our technology aims to deliver drug candidates to target receptors and specified cells or tissues at disease sites. However, this approach has had limited testing in humans, and we may spend substantial funds attempting to develop these products without ever succeeding in developing a marketable therapeutic. We cannot assure you that our product candidates will safely and effectively treat the targeted diseases.

Before obtaining marketing approval, we must complete pre-clinical development and conduct extensive clinical trials to demonstrate safety and efficacy in humans. Clinical testing is expensive, can take many years, and outcomes are uncertain. A failure can occur at any stage, and the outcome of early trials may not predict later trial success. Our product development costs will increase if we experience delays, which could also shorten any exclusive commercialization periods, allow competitors to bring products to market before us, and harm our business and results of operations.

Delays, suspension, or termination of clinical trials could limit our ability to commercialize products and affect our business prospects.

Before obtaining marketing approval from the FDA, we must conduct extensive clinical studies to demonstrate safety and efficacy. Clinical testing is expensive, time consuming, and uncertain. We rely in part on pre-clinical, clinical and quality data generated by CROs and other third parties. The FDA may require additional pre-clinical studies before allowing us to initiate clinical trials, which could delay our development programs and increase costs.

We may not be able to initiate or continue clinical trials if we cannot identify and enroll sufficient eligible patients. Patient enrollment is a significant factor in clinical trial timing. Clinical trials may be suspended or terminated by us, by IRBs/ECs, by a Data Safety Monitoring Board, or by the FDA due to factors including: failure to conduct trials in accordance with regulatory requirements; inspection findings resulting in clinical holds; unforeseen safety issues or adverse side effects; failure to demonstrate benefit; changes in governmental regulations; or lack of adequate funding. Changes in regulatory requirements may require us to amend clinical trial protocols and resubmit them to IRBs/ECs for reexamination, impacting costs, timing, or successful completion. Additionally, financial relationships between us and clinical investigators could create perceived conflicts of interest that the FDA may conclude affect interpretation of data, potentially jeopardizing trial utility and resulting in approval delays or denial.

Certain of our scientific advisors or consultants who receive compensation from us are investigators for our clinical trials. We cannot guarantee that the FDA will not deem the financial relationship between us and a principal investigator as creating a conflict of interest or otherwise affecting interpretation of the study. The FDA may therefore question the integrity of the data generated at the applicable clinical trial site and the utility of the clinical trial itself may be jeopardized.

The outcome of pre-clinical testing and early clinical trials may not be predictive of later success.

We must demonstrate through well-controlled clinical trials that our product candidates are safe and effective before seeking marketing approvals. Success in pre-clinical studies and early-stage clinical trials does not guarantee future success. Product candidates in later-stage trials may fail to demonstrate sufficient safety and efficacy to the satisfaction of the FDA, EMA, and other regulatory authorities. There can be significant variability in safety and efficacy results between different clinical trials of the same product candidate due to factors including changes in trial protocols, differences in patient populations, adherence to dosing regimens, and dropout rates. Patients may also be using other treatments that cause side effects unrelated to our product candidates, increasing uncertainty in clinical trial outcomes.

Interim, topline, and preliminary clinical trial data may change as more patient data becomes available and are subject to audit and verification procedures.

From time to time, we may publicly disclose preliminary, interim, or topline data from clinical trials. These are based on preliminary analysis and are subject to change following more comprehensive review. The topline results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Topline data remain subject to audit and verification procedures that may result in material changes. Adverse changes between interim and final data could significantly harm our business. In addition, we may report interim analyses of only certain endpoints rather than all endpoints. Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Information we choose to disclose is typically selected from a more extensive amount of available information. If the data we report differs from final results, or if others disagree with our conclusions, our ability to obtain approval and commercialize our product candidates may be harmed.

Adverse side effects or safety risks could delay or preclude approval, cause us to suspend clinical trials, or result in negative consequences following any marketing approval.

Clinical trials could reveal unacceptable side effects or unexpected characteristics. Undesirable side effects could result in the delay, suspension, or termination of clinical trials. Serious adverse events could hinder market acceptance of our drug candidates. We may elect to abandon or limit development to narrower uses or subpopulations where side effects are less prevalent or more acceptable from a risk-benefit perspective. Many drugs that initially showed promise have later been found to cause side effects that prevented further development. It is possible that as we test our drug candidates in larger, longer, and more extensive clinical trials, adverse events that were not detected in earlier trials will be reported. If such side effects become known later in development or upon approval, such findings may significantly harm our business.

We may not achieve our development milestones on our projected timelines.

The achievement of milestones such as the timing of the accomplishment of various scientific, clinical, manufacturing, regulatory, and other product development objectives may be outside of our control. All of these milestones are based on a variety of assumptions, including assumptions regarding capital resources, constraints and priorities, progress of, and results from development activities and the receipt of key regulatory approvals or actions, any of which may cause the timing of achievement of the milestones to vary considerably from our estimates. If we or our collaborators fail to achieve announced milestones in the expected timeframes, the commercialization of our product candidates may be delayed, our credibility may be undermined, our business and results of operations may be harmed, and the price of our common stock may decline.

Product liability claims could materially harm our business.

The use of our product candidates in clinical trials and the sale of any approved products may expose us to significant product liability claims. We currently do not have product liability insurance coverage but intend to obtain such insurance. Such insurance may not protect us against all claims, and we may not be able to acquire adequate coverage at a commercially reasonable cost. If our product candidates are approved for sale, we may need to substantially increase our coverage. Defending product liability claims could require us to expend significant financial and managerial resources, which could have an adverse effect on our business.

Our current and future products may never achieve significant commercial market acceptance.

Our success depends on the market’s confidence that we can provide therapeutic products that improve clinical outcomes and lower healthcare costs. Failure of our products to perform as expected could impair our operating results and reputation. Patients, clinicians, academic institutions, and biopharmaceutical companies are likely to be particularly sensitive to defects, errors, inaccuracies, delays, and toxicities associated with our products.

We may not succeed in achieving significant commercial market acceptance for our current or future products due to a number of factors, including:

Customers and collaborators may decrease or discontinue use of our products due to changes in their plans, financial constraints, the regulatory environment, negative publicity, competing products, or reimbursement landscape. Failure to achieve widespread market acceptance would materially harm our business, financial condition, and results of operations.

We face significant competition from companies that may develop more effective, safer, or less expensive products.

The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition, and strong emphasis on proprietary products. Our competitors have developed, are developing, or may develop products competitive with ours. Any product candidates we successfully commercialize will compete with existing and new therapies. We may need to compete with drugs physicians use off-label to treat our targeted indications, making it difficult to replace existing therapies.

There is intense competition in rare diseases, inflammatory conditions, and oncology. We have competitors including major multinational pharmaceutical companies, established biotechnology companies, specialty pharmaceutical companies, and research institutions. We also compete with these organizations to recruit management and scientific personnel and to establish clinical trial sites and enroll subjects.

Our commercial opportunity could be reduced or eliminated if competitors develop safer, more effective, more convenient, or less expensive products, or if they obtain marketing approval before us. Technological advances by our competitors may render our technologies or product candidates obsolete or not economical.

We are subject to healthcare laws and regulations.

Sales of our product candidates, if approved, will be subject to healthcare regulation and enforcement by federal, state, and foreign governments. Applicable laws include the federal Anti-Kickback Statute, federal false claims and false statement laws, HIPAA, and the federal Physician Payments Sunshine Act. Many states have similar laws that may be broader in scope and apply regardless of payor, including laws requiring drug manufacturers to report payments to healthcare providers, to comply with voluntary compliance guidelines, and to register sales representatives.

The laws and regulations applicable to our business are complex, changing, and often subject to varying interpretations. Any violation could result in substantial financial penalties, termination of business relationships, mandated refunds, required changes to business practices, exclusion from healthcare programs, and possible criminal penalties. If found in violation, we could suffer severe consequences that would materially adversely affect our business, results of operations, financial condition, and stock price.

Federal, state, and local legislative bodies frequently pass legislation relating to healthcare reform. We anticipate continued government oversight and regulation of the healthcare industry. We cannot predict the content, timing, or effect of new healthcare legislation or regulations, nor their impact on our business.

We may not be able to obtain or maintain Fast Track designation or accelerated approval for our drug candidates.

If a drug is intended for the treatment of a serious condition and nonclinical or clinical data demonstrate the potential to address unmet medical need for this condition, a drug sponsor may apply for FDA Fast Track designation. If there are therapies already available for the condition, a fast track drug must show an advantage over the available therapy including superior efficacy, lessening or avoidance of side effects, improving the diagnosis of a serious condition, decreasing a clinical significant toxicity of an available therapy or ability to address an emerging or anticipated public health need. If we seek Fast Track designation for a drug candidate, we may not receive it from the FDA. However, even if we receive Fast Track designation, Fast Track designation does not ensure that we will receive marketing approval or that approval will be granted within any particular time frame. We may not experience a faster development or regulatory review or approval process with Fast Track designation compared to conventional FDA procedures. In addition, the FDA may withdraw Fast Track designation if it believes that the designation is no longer supported by data from our clinical development program. Fast Track designation alone does not guarantee qualification for the FDA’s priority review procedures.

We may not be able to obtain or maintain orphan drug designation or exclusivity for our drug candidates.

Under the Orphan Drug Act, the FDA may designate a drug candidate as an orphan drug if intended to treat a rare disease or condition (generally defined as a patient population of fewer than 200,000 in the United States). Orphan drug designation provides financial incentives including grant funding opportunities, tax advantages, and user-fee waivers. If a product with orphan designation receives the first FDA approval for that indication, it is entitled to seven years of exclusivity during which the FDA may not approve competing applications for the same drug and indication, except in certain circumstances.

Competitors may receive approval of different products for the same indication or the same product for different indications. Exclusive marketing rights may be limited if we seek approval for an indication broader than the orphan-designated indication or may be lost if the FDA later determines the designation request was materially defective.

Breakthrough Therapy designation may not lead to faster development, review, or approval.

Designation as a breakthrough therapy is within the discretion of the FDA. Even if we believe our drug candidates meet the criteria, the FDA may disagree. Receipt of Breakthrough Therapy designation may not result in faster development, review, or approval compared to conventional procedures and does not assure ultimate approval. The FDA may later decide that drugs no longer meet qualification conditions. A breakthrough therapy is defined as a drug intended to treat a serious or life-threatening condition for which preliminary clinical evidence indicates substantial improvement over existing therapies. Drugs designated as breakthrough therapies are eligible for accelerated approval and enhanced FDA interaction during development.

We rely on third parties to conduct our pre-clinical studies and clinical trials, and their failure to perform could substantially harm our business.

We rely on third-party medical institutions, clinical investigators, contract laboratories, and CROs to conduct and manage our pre-clinical and clinical programs. We control only certain aspects of their activities but remain responsible for ensuring studies comply with applicable protocols, legal, regulatory, and scientific standards. We and our CROs must comply with current Good Clinical Practice (GCP) regulations enforced by the FDA, EMA, and comparable foreign regulatory authorities.

Regulatory authorities enforce GCP through periodic inspections of trial sponsors, principal investigators, and trial sites. If we or our CROs fail to comply with applicable GCPs, clinical data may be deemed unreliable by relevant authorities and additional trials may be required. Our clinical trials must also be conducted with products produced under cGMP. If our relationships with CROs terminate, we may not be able to enter into alternative arrangements on commercially reasonable terms. In addition, CROs are not our employees, and we cannot control their operations-including their conduct of our clinical, nonclinical and pre-clinical or clinical programs. If CROs do not successfully carry out their duties, meet deadlines, or if data quality is compromised, our clinical trials may be extended, delayed, or terminated, harming our commercial prospects and ability to generate revenues.

Many third parties with whom we contract may also have relationships with our competitors. If they do not perform their duties, experience work stoppages, or need to be replaced, we may need to enter into new arrangements with alternative third parties. Switching CROs involves additional cost and management time, and transition periods can materially impact our clinical development timelines.

We rely on third-party manufacturers for our drug candidates and expect to continue doing so for commercialization.

We rely entirely on third-party manufacturers for the production of our drug candidates for pre-clinical and clinical testing and any potential commercial supply, as we do not own or operate manufacturing facilities. This dependence exposes us to risks related to insufficient supply, inadequate quality, and unfavorable cost structures, which could delay development timelines or impair commercialization efforts. We may be unable to secure or maintain manufacturing agreements on acceptable terms, and our limited supply arrangements generally do not extend to commercial-scale production. Many key materials are sourced on a purchase order basis without long-term commitments, increasing the risk of supply interruptions.

Third-party manufacturing arrangements subject us to additional operational and compliance risks beyond our direct control, including regulatory noncompliance, quality failures, contract breaches, operational disruptions, logistics delays, improper storage or transport, and potential misappropriation of proprietary information. Manufacturers may fail to comply with cGMP or other regulatory standards, which could result in clinical holds, fines, product recalls, approval delays, or other enforcement actions that disrupt supply. These manufacturers are also subject to environmental, health, and safety laws, and regulatory actions against them could lead to facility shutdowns or restricted operations, adversely affecting our access to necessary manufacturing and packaging services.

Manufacturing capacity is limited among qualified cGMP-compliant providers, and our drug candidates may compete with other products for facility access, reducing our ability to secure priority production slots. As we scale production for later-stage trials or commercialization, manufacturing complexity increases and even minor process deviations or contamination events could lead to reduced yields, batch failures, or facility closures. We currently lack redundant suppliers for bulk drug substance, and replacing underperforming manufacturers could involve significant time and cost. Any manufacturing failure or transition to alternative suppliers may delay development or approval and could negatively affect our margins and ability to commercialize approved products on a timely and competitive basis.

We currently depend on a sole source supplier and manufacturer for the active ingredient in our product candidates and the inability to obtain the active ingredient for our product candidates as required could harm our business.

We currently source the active ingredient for HS1940, HS3215 and HS0059 from sole suppliers/manufacturers. In addition, we anticipate that we will also source the active ingredient in GV104 from a sole supplier/manufacturer. Although we believe that we can obtain the active ingredient for HS1940, HS3215, HS0059 and GV104 from other suppliers, supply shortages for these particular raw materials may delay our clinical trials. If we are unable to procure the active ingredient for our product candidates as needed, our business may be harmed.

Our failure to find third party collaborators to assist or share in the costs of drug development could materially harm our business, financial condition and results of operations.

Our strategy for the development and commercialization of our proprietary drug candidates may include the execution of collaborative arrangements with third parties. Existing and future collaborators have significant discretion in determining the efforts and resources they apply and may not perform their obligations as expected. Potential third-party collaborators include biopharmaceutical, pharmaceutical and biotechnology companies, academic institutions and other entities. Third-party collaborators may assist us in funding research and development activities, clinical trials and manufacturing, obtaining regulatory approvals, and commercializing any future drug candidates.

If we are not able to establish collaboration, we may be required to undertake drug development and commercialization at our own expense. Such an undertaking may limit the number of drug candidates that we will be able to develop, significantly increase our capital requirements and place additional strain on our internal resources. Our failure to enter into additional collaborations could materially harm our business, financial condition and results of operations.

Our dependence on licensing and collaboration with third parties may subject us to additional risks. We may not be able to secure such relationships on terms that prove favorable to us. Our agreements with such partners may contain exclusivity terms that limit other collaboration opportunities. Lengthy negotiations with potential new collaborators may lead to delays in the research, development or commercialization of drug candidates. Our collaborators may decide to pursue other technologies or fail to develop or commercialize our drug candidates, which could materially harm our business, financial condition and results of operations.

We may not be successful in commercializing one or more of our drug candidates.

We have not submitted an application for or received marketing approval for any of our drug candidates in the United States or in any other jurisdiction. The marketing approval process is expensive, time-consuming and uncertain, which may prevent us from obtaining approvals for the commercialization of some or all of our drug candidates. If we are not able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize our drug candidates, and our ability to generate revenue will be materially impaired.

Our drug candidates and the activities associated with the development and commercialization are subject to comprehensive regulation by the FDA and other regulatory agencies.

We have only limited experience in filing and supporting the applications for marketing approvals, and we expect to rely on third-party clinical research organizations or other third-party consultants or vendors to assist us in this process. Securing marketing approval requires the submission of extensive pre-clinical and clinical data and supporting information to regulatory authorities for each therapeutic indication to establish the drug candidate’s safety and efficacy. Securing marketing approval also requires the submission of information about the drug manufacturing process to, and inspection of manufacturing facilities by, the regulatory authorities.

The process of obtaining marketing approvals, both in the United States and abroad, is lengthy and expensive. Changes in marketing approval policies during the development period, adoption of new statutes or regulations, or changes in regulatory review process, may cause delays in the approval or rejection of an application. Regulatory authorities have broad discretion in the approval process. They may interpret our study and trial data differently, which may also delay, limit, or prevent approval. Any approval obtained may be subject to restrictions or post-approval obligations that could adversely affect commercial viability.

If we are unable to develop satisfactory sales and marketing capabilities, we may not succeed in commercializing our drug candidates.

We have no experience in marketing and selling drug products. We have not entered into arrangements for the sale and marketing of any of our drug candidates.

There are risks involved with establishing our own sales and marketing capabilities. For example, recruiting and training a sales force is expensive and time-consuming and could delay any product launch. If the commercial launch of a drug candidate for which we recruit a sales force and establish marketing capabilities is delayed or does not occur for any reason, we would have prematurely or unnecessarily incurred these commercialization expenses. These efforts are expected to be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing personnel.

We may seek to collaborate with a third party to market our drugs or may seek to market and sell our drugs by ourselves. If we seek to collaborate with a third party, we cannot be sure that a collaborative agreement can be reached on terms acceptable to us.

We cannot be sure that we will be able to acquire, or establish third party relationships to provide, any or all of these marketing and sales capabilities. The establishment of a direct sales force or a contract sales force or a combination direct and contract sales force to market our drugs will be expensive and time-consuming and could delay any drug launch. Further, we can give no assurances that we may be able to maintain a direct and/or contract sales force for any period of time or that our sales efforts will be sufficient to generate or to grow our revenues or that our sales efforts will ever lead to profits.

The development and commercialization of pharmaceutical products are subject to extensive regulation, and we may not obtain regulatory approvals for our drug candidates on a timely basis, or at all.

The time required to obtain FDA approval is unpredictable and typically takes many years following the commencement of clinical trials. Approval depends upon numerous factors, including the substantial discretion of regulatory authorities, and approval policies, regulations, and the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical development. We have not obtained regulatory approval for any product candidate, and it is possible that we may never obtain regulatory approval for any product candidates we may seek to develop in the future.

Prior to obtaining approval to commercialize any drug product candidate in the United States, we must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA, that such product candidates are safe, pure and effective for their intended uses. Even if we believe pre-clinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA, and the FDA may require us to conduct additional pre-clinical studies or clinical trials either prior to or after approval.

Our product candidates could fail to receive regulatory approval for many reasons, including: the FDA may disagree with the design or implementation of our clinical trials; we may be unable to demonstrate that a product candidate is safe and effective for its proposed indication; the results of clinical trials may not meet the level of statistical significance required for approval; we may be unable to demonstrate that a product candidate’s clinical benefits outweigh its safety risks; the FDA may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract; and the approval policies or regulations of the FDA may significantly change in a manner rendering our clinical data insufficient for approval.

Of the large number of products in development, only a small percentage successfully complete the FDA approval processes and are commercialized. Even if we complete clinical testing and receive approval, the FDA may grant approval contingent on costly additional post-marketing clinical trials, or may approve a product candidate for a more limited indication or patient population than originally requested. The FDA may also change its policies, issue additional regulations, or take other actions that could impose additional requirements, delay our ability to obtain approvals, increase compliance costs, or restrict our ability to maintain any marketing authorizations we may have obtained.

Failure to obtain marketing approval in foreign jurisdictions would prevent our drug candidates from being marketed abroad.

In order to market and sell our drugs in the European Union and many other foreign jurisdictions, we or our potential third-party collaborators must obtain separate marketing approvals and comply with numerous and varying regulatory requirements. The approval procedure varies among countries and can involve additional testing. The time required to obtain approval may differ substantially from that required to obtain FDA marketing approval. The regulatory approval process outside of the United States generally includes all of the risks associated with obtaining FDA approval. In addition, in many countries outside of the United States, it is required that the drug be approved for reimbursement before the drug can be approved for sale in that country. We or our potential third-party collaborators may not obtain approvals from regulatory authorities outside of the United States on a timely basis, if at all. Approval by the FDA does not ensure approval by regulatory authorities in other countries or jurisdictions, and approval by one regulatory authority outside of the United States does not ensure approval by regulatory authorities in other countries or jurisdictions or by the FDA. However, a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries. We may not be able to file for marketing approvals and may not receive necessary approvals to commercialize our drugs in any market.

Any approved drug candidates may be subject to post-marketing requirements, restrictions, or withdrawal, and noncompliance could result in penalties.

The FDA may require a companion diagnostic for certain product candidates. When a diagnostic is essential to the safe and effective use of a therapeutic, the FDA generally expects the diagnostic to be authorized contemporaneously. Companion diagnostics are regulated as medical devices and often require Premarket Approval (PMA), an uncertain and time-consuming process. If we must obtain approval of a companion diagnostic and are delayed or unable to do so, commercialization of the related therapeutic could be delayed or prevented.

Any product approved for marketing, and its manufacturing, labeling, advertising, promotion, and post-approval studies, will be subject to ongoing FDA and other regulatory oversight, including safety reporting, registration and listing, cGMP, recordkeeping, and, where applicable, Risk Evaluation and Mitigation Strategies (REMS). Approvals may include limitations on use or other conditions that could restrict commercialization.

Regulators, including the FDA and the Department of Justice, closely monitor post-approval promotion. Promotion outside the approved labeling can trigger enforcement under the FDCA and other laws, including the False Claims Act, and may result in civil or criminal liability.

If previously unknown safety issues or compliance problems arise, regulators may require labeling changes or warnings; restrict distribution or use; mandate additional post-marketing studies or clinical trials; issue warning or untitled letters; require recalls or withdrawals; refuse to approve supplements; suspend or withdraw approvals; impose fines, disgorgement, injunctions, seizures, or import/export restrictions; or pursue other remedies. These actions, as well as related litigation, reputational harm, and impacts on collaborations, could materially adversely affect our business.

Healthcare reform initiatives in the United States may impact our business and results of operations.

In the United States, there have been and continue to be a number of legislative initiatives to contain healthcare costs. For example, in March 2010, the Patient Protection and Affordable Care Act (the ACA) was passed, which substantially changed the way healthcare is financed by both government and private insurers, and significantly impacts the U.S. pharmaceutical industry. The ACA, among other things, increased the minimum Medicaid rebates owed by manufacturers under the Medicaid Drug Rebate Program and extended the rebate program to individuals enrolled in Medicaid managed care organizations, established annual fees and taxes on manufacturers of certain branded prescription drugs. Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA. In June 2021, the U.S. Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA.

Other legislative changes have been proposed and adopted in the United States since the ACA was enacted. In March 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminated the statutory cap on the Medicaid drug rebate beginning January 1, 2024. The rebate was previously capped at 100% of a drug’s average manufacturer price.

We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates, complementary diagnostics or companion diagnostics, or impose additional pricing pressures.

Additionally, there has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices. Specifically, there have been several recent Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs.

In addition, FDA regulations and guidance may be revised or reinterpreted by the FDA in ways that may significantly affect our business. Any new regulations or guidance, or revisions or reinterpretations of existing regulations or guidance, may impose additional costs or lengthen FDA review times for our product candidates. We cannot determine how changes in regulations, statutes, policies or interpretations when and if issued, enacted or adopted may affect our business in the future.

If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could harm our business.

We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our operations involve the use of hazardous and flammable materials, including chemicals and biological and radioactive materials. Our operations also produce hazardous waste products. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties.

Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal of biological, hazardous or radioactive materials.

If we do not obtain patent term extension for any drug candidates we may develop, our business may be materially harmed.

In the United States, depending upon the timing, duration, and specifics of any FDA marketing approval of a drug candidate, the patent term of a patent that covers an FDA-approved drug may be eligible for limited patent term extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory review process. The Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act, permits a patent term extension of up to five years beyond the expiration of the patent. The length of the patent term extension is related to the length of time the drug is under regulatory review. Patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of drug approval, and only one patent applicable to an approved drug may be extended and only those claims covering the approved drug, a method for using it, or a method for manufacturing it may be extended. Similar provisions are available in Europe and other non-United States jurisdictions to extend the term of a patent that covers an approved drug. While, in the future, if and when our drug candidates receive FDA approval, we expect to apply for patent term extensions on patents covering those drug candidates, there is no guarantee that the applicable authorities will agree with our assessment of whether such extensions should be granted, and even if granted, the length of such extensions. We may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of the relevant patents, or otherwise failing to satisfy applicable requirements. If we are unable to obtain any patent term extension or the term of any such extension is less than we request, our competitors may obtain approval of competing drugs following the expiration of our patent rights, and our business, financial condition, results of operations, and prospects could be materially harmed.

Risks Related to Our Operations and Financial Conditions

We have incurred significant losses since inception, we expect to incur losses in the future and we may not be able to generate sufficient revenue to achieve and maintain profitability.

We have never been profitable and have incurred significant losses in each year since inception. For the years ended December 31, 2025 and 2024, we reported a net loss of $35.9 million and $12.2 million, respectively. As of December 31, 2025, we had an accumulated deficit of $72.8 million. We have funded our operations primarily with proceeds from the sale of our equity and debt securities.

We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future. The net losses we incur may fluctuate significantly from quarter to quarter such that a period-to-period comparison of our results of operations may not be a good indication of our future performance. The size of our future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenue. Our prior losses and expected future losses have had and will continue to have an adverse effect on our working capital, our ability to achieve and maintain profitability and the performance of our stock.

Due to our limited operating history and the concentration of our CC token holdings, it will be difficult to evaluate our business and future prospects, and we may not be able to achieve or maintain profitability in any given period.

We have a limited operating history, particularly with respect to our current business model, which is highly concentrated in the acquisition and holding of CC. As a result, there is limited historical information available to evaluate our business, our management’s ability to execute our strategy, or our prospects for future growth and profitability. The lack of a diversified operating history increases the difficulty for investors and analysts to assess our performance, business model viability, and the likelihood of achieving or maintaining profitability. Furthermore, our financial results and prospects are highly dependent on the value and performance of our CC token holdings, which are subject to significant volatility and risk. If we are unable to effectively manage our CC token portfolio, respond to market changes, or adapt our business strategy as necessary, we may not be able to achieve or sustain profitability in any given period. This uncertainty may adversely affect the market price of our stock and the value of an investment in us.

We will need additional financing in the future, which may not be available when needed or may be costly and dilutive.

We will require additional financing to support our working capital needs in the future. The amount of additional capital we may require, the timing of our capital needs and the availability of financing to fund those needs will depend on a number of factors, including our strategic initiatives and operating plans, the performance of our business and the market conditions for debt or equity financing. Additionally, the amount of capital required will depend on our ability to meet our sales goals and otherwise successfully execute our operating plan. We believe it is imperative that we meet these sales objectives in order to lessen our reliance on external financing in the future. We intend to continually monitor and adjust our operating plan as necessary to respond to developments in our business, our markets and the broader economy. Although we believe various debt and equity financing alternatives will be available to us to support our working capital needs, financing arrangements on acceptable terms may not be available to us when needed.

Our senior management team has limited experience managing and operating a U.S. public company.

Certain members of our management team have limited experience managing and operating a U.S. publicly traded company, interacting with U.S. public company investors, and complying with the increasingly complex laws pertaining to U.S. public companies. These new obligations and constituents will require significant attention from our senior management and could divert their attention away from the day-to-day management of our business. To support our operations as a U.S. public company, we may need to recruit additional qualified employees or external consultants with relevant experience, which will increase our operating costs in future periods. Should any of these factors materialize, the Company’s business, financial condition and results of operations could be adversely affected.

Unrealized fair value gains on the Company’s CC holdings may cause the Company to become subject to the corporate alternative minimum tax under the Inflation Reduction Act of 2022.

The U.S. enacted the Inflation Reduction Act of 2022 (“IRA”) in August 2022. Unless an exemption applies, the IRA imposes a 15% corporate alternative minimum tax (“CAMT”) on a corporation with respect to an initial tax year and subsequent tax years if the average annual adjusted financial statement income for any consecutive three-tax-year period preceding the initial tax year exceeds $1 billion. On September 12, 2024, the Department of Treasury and the IRS issued proposed regulations with respect to the application of CAMT.

Additionally, the Company has adopted ASU 2023-08, under which the Company’s CC holdings must be measured at fair value in the Company’s statement of financial position, with gains and losses from changes in the fair value of our CC tokens recognized in net income each reporting period. When determining whether the Company is subject to CAMT and when calculating any related tax liability for an applicable tax year, the proposed regulations provide that, among other adjustments, the Company’s adjusted financial statement income must include any unrealized gains or losses reported in the applicable tax year.

Accordingly, as a result of the enactment of the IRA and the Company’s adoption of ASU 2023-08, the Company may be subject to CAMT in the 2026 taxable year and beyond. If the Company becomes subject to CAMT, it could result in a material tax obligation that the Company would need to satisfy in cash, which could materially affect the Company’s financial results, including its earnings and cash flow, and its financial condition.

Risks Related to Cybersecurity, Information Technology, and Intellectual Property

If we or our third-party service providers experience a security breach or cyberattack and unauthorized parties obtain access to our CC tokens, or if our private keys are lost or destroyed, or other similar circumstances or events occur, we may lose some or all of our CC tokens and our financial condition and results of operations could be materially adversely affected.

Substantially all of the CC tokens we own will be held in custody accounts at institutional-grade digital asset custodians. Security breaches and cyberattacks are of particular concern with respect to our CC tokens. Cryptocurrencies and the entities that provide services to participants in the ecosystem have been, and may in the future be, subject to security breaches, cyberattacks, or other malicious activities. A successful security breach or cyberattack could result in:

Further, any actual or perceived data security breach or cybersecurity attack directed at other companies with digital assets or companies that operate digital asset networks, regardless of whether we are directly impacted, could lead to a general loss of confidence in the broader CC ecosystem or in the use of the Canton Network to conduct financial transactions, which could negatively impact us.

Our business and operations would be adversely impacted in the event of a failure or interruption of our information technology infrastructure or as a result of a cybersecurity attack.

The proper functioning of our own information technology (IT) infrastructure is critical to the efficient operation and management of our business. We may not have the necessary financial resources to update and maintain our IT infrastructure, and any failure or interruption of our IT system could adversely impact our operations. Breaches with respect to protected health information could result in violations of HIPAA and analogous state laws and risk the imposition of significant fines and penalties. In addition, our IT is vulnerable to cyberattacks, computer viruses, worms and other malicious software programs, physical and electronic break-ins, sabotage and similar disruptions from unauthorized tampering with our computer systems. Failure of our information technology systems could delay billing and otherwise disrupt or adversely affect our business, profitability and financial condition. We believe that we have adopted appropriate measures to mitigate potential risks to our technology infrastructure and our operations from these IT-related and other potential disruptions. However, given the unpredictability of the timing, nature and scope of any such IT failures or disruptions, we could potentially be subject to downtimes, transactional errors, processing inefficiencies, operational delays, other detrimental impacts on our operations or ability to provide products to our customers, the compromising of confidential or personal information, destruction or corruption of data, security breaches, other manipulation or improper use of our systems and networks, financial losses from remedial actions, loss of business or potential liability, and/or damage to our reputation, any of which could have a material adverse effect on our cash flows, competitive position, financial condition or results of operations.

Changes to patent laws in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our drugs.

Obtaining and enforcing patents involves both technological and legal complexity and is therefore costly, time consuming and inherently uncertain. Changes in either the patent laws or interpretation of the patent laws in the United States could increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. Recent patent reform legislation in the United States and other countries, including the Leahy-Smith America Invents Act (the “Leahy-Smith Act”) signed into law in September 2011, could increase those uncertainties and costs. The Leahy-Smith Act includes a number of significant changes to U.S. patent law. These include provisions that affect the way patent applications are prosecuted, redefine prior art and provide more efficient and cost-effective avenues for competitors to challenge the validity of patents. For example, the Leahy-Smith Act allows third-party submission of prior art to the U.S. Patent and Trademark Office (“USPTO”) during patent prosecution and additional procedures to attack the validity of a patent by USPTO administered post-grant proceedings, including post-grant review, inter parties review, and derivation proceedings. In addition, the Leahy-Smith Act has transformed the U.S. patent system from a “first-to-invent” system to a “first-to-file” system in which, assuming that other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent on an invention regardless of whether a third party was the first to invent the claimed invention.

In addition, the patent positions of companies in the development and commercialization of biologics and pharmaceuticals are particularly uncertain. Recent U.S. Supreme Court and Federal Circuit rulings have narrowed the scope of patent protection available in certain circumstances and weakened the rights of patent owners in certain situations. This combination of events has created uncertainty with respect to the validity and enforceability of patents once obtained. Depending on future actions by the U.S. Congress, the federal courts, and the USPTO, the laws and regulations governing patents could change in unpredictable ways that could have a material adverse effect on our patent rights and our ability to protect, defend and enforce our patent rights in the future.

We or our licensors may become involved in lawsuits to protect or enforce our patent or other intellectual property rights, which could be expensive, time-consuming and unsuccessful.

Competitors and other third parties may infringe, misappropriate or otherwise violate our or our future licensors’ issued patents or other intellectual property. As a result, we or our licensors may need to file infringement, misappropriation or other intellectual property related claims, which can be expensive and time-consuming. Any claims we assert against perceived infringers could provoke such parties to assert counterclaims against us alleging that we infringe, misappropriate or otherwise violate their intellectual property. In addition, in a patent infringement proceeding, such parties could counterclaim that the patents we or our licensors have asserted are invalid or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness, or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO, or made a misleading statement, during prosecution. Third parties may institute such claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, post-grant review, inter parties review, interference proceedings, derivation proceedings, and equivalent proceedings in foreign jurisdictions (e.g., opposition proceedings).

An adverse result in any such proceeding could put one or more of our owned or in-licensed patents at risk of being invalidated or interpreted narrowly, and could put any of our owned or in-licensed patent applications at risk of not yielding an issued patent. A court may also refuse to stop the third party from using the technology at issue in a proceeding on the grounds that our owned or in-licensed patents do not cover such technology. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information or trade secrets could be compromised by disclosure during this type of litigation. Any of the foregoing could allow such third parties to develop and commercialize competing technologies and products and have a material adverse impact on our business, financial condition, results of operations, and prospects.

Third parties may initiate legal proceedings alleging that we are infringing, misappropriating or otherwise violating their intellectual property rights, the outcome of which would be uncertain and could have a material adverse effect on the success of our business.

Our commercial success may depend in part upon our ability to develop, manufacture, market and sell our product candidates and use our proprietary technologies without infringing, misappropriating or otherwise violating the intellectual property and other proprietary rights of third parties. There is considerable intellectual property litigation in the pharmaceutical industry.

We may become party to, or threatened with, future adversarial proceedings or litigation regarding intellectual property rights with respect to our product candidates and their manufacture and our other technology, including re-examination, interference, post-grant review,inter partes review or derivation proceedings before the USPTO or an equivalent foreign body. Numerous U.S. and foreign issued patents and pending patent applications owned by third parties exist in the fields in which we are developing our product candidates. Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of their merit.

Even if we believe third-party intellectual property claims are without merit, there is no assurance that a court would find in our favor on questions of infringement, validity, enforceability or priority. A court of competent jurisdiction could hold that third-party patents asserted against us are valid, enforceable and infringed, which could materially and adversely affect our ability to commercialize any of our product candidates and any other product candidates or technologies covered by the asserted third-party patents. In order to successfully challenge the validity of a U.S. patent in federal court, we would need to overcome a presumption of validity. As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of a U.S. patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S. patent. If we are found to infringe, misappropriate or otherwise violate a third party’s intellectual property rights, and we are unsuccessful in demonstrating that these rights are invalid or unenforceable, we could be required to obtain a license from such a third party in order to continue developing and marketing our products and technology. However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors access to the same technologies licensed to us. We could be forced, including by court order, to cease commercializing the infringing technology or product. A finding of infringement could prevent us from commercializing our product candidates or force us to cease some of our business operations. In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties and other fees, redesign our infringing product candidate or obtain one or more licenses from third parties, which may be impossible or require substantial time and monetary expenditure. Claims that we have misappropriated the confidential information or trade secrets of third parties could have a similar negative impact on our business.

Intellectual property litigation or other legal proceedings relating to intellectual property could cause us to spend substantial resources and distract our personnel from their normal responsibilities.

Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and may also have an advantage in such proceedings due to their more mature and developed intellectual property portfolios. Uncertainties resulting from the initiation and continuation of intellectual property litigation or other proceedings could compromise our ability to compete in the marketplace.

If we fail to comply with our obligations in license arrangements with third parties, we could lose rights that are important to our business.

We are and may continue to be party to license agreements. If we fail to comply with such obligations, our counterparties may have the right to terminate our agreements or seek other remedies, which could materially adversely affect our operations. We may lose our rights under such agreements or may need to renew these agreements with less favorable terms, which would have a material adverse effect on our business, financial condition, results of operations, and prospects.

Additionally, these and other license agreements may not provide exclusive rights to use the licensed intellectual property and technology in all relevant fields of use and in all territories. As a result, we may not be able to prevent competitors from developing and commercializing competitive products and technology in fields of use and territories not included in such agreements. In addition, we may not have the right to control the preparation, filing, prosecution, maintenance, enforcement, and defense of patents and patent applications covering the technology that we may license from third parties. Therefore, we cannot be certain that these patents and patent applications will be prepared, filed, prosecuted, maintained, and defended in a manner consistent with the best interests of our business. If our licensors fail to prosecute, maintain, enforce, and defend such patents, or lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated, and our right to develop and commercialize any of our drugs that are the subject of such licensed rights could be adversely affected.

In addition, any agreements under which we license intellectual property or technology from third parties may be complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects. Moreover, if disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected technology and drug candidates, which could have a material adverse effect on our business, financial conditions, results of operations, and prospects.

If we are unable to obtain licenses from third parties on commercially reasonable terms or at all, our business could be harmed.

It may be necessary for us to use the patented or proprietary technology of third parties to commercialize our products, in which case we would be required to obtain a license from these third parties. The licensing of third-party intellectual property rights is a competitive area, and more established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. More established companies may have a competitive advantage over us due to their size, capital resources and greater development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. We also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to make an appropriate return on our investment or at all. If we are unable to obtain a necessary license, we may be unable to develop or commercialize the affected product candidates, and the third parties owning such intellectual property rights could seek either an injunction prohibiting our sales, or, with respect to our sales, an obligation on our part to pay royalties or other forms of compensation. Even if we are able to obtain a license, it may be non-exclusive, thereby giving our competitors access to the same technologies licensed to us. If we are unable to license needed technology, or if we are forced to license this technology on unfavorable terms, our business could be materially harmed.

We may not be able to protect our intellectual property and proprietary rights.

Filing, prosecuting, and defending patents on drug candidates in all countries throughout the world would be prohibitively expensive, and the laws of foreign countries may not protect our rights to the same extent as the laws of the United States. Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we have patent protection or licenses but enforcement is not as strong as that in the United States. These products may compete with our products, and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, particularly those relating to pharmaceutical products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our intellectual property and proprietary rights generally. Proceedings to enforce our intellectual property and proprietary rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly, could put our patent applications at risk of not issuing, and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property and proprietary rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.

Many countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent. If we or any of our licensors are forced to grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired, and our business, financial condition, results of operations, and prospects may be adversely affected.

Risks Related to Our Securities and Being a Public Company

The price of our stock may be volatile, and you could lose all or part of your investment.

The trading price of our common stock may be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control, including limited trading volume. In addition to the factors discussed in this “Risk Factors” section and elsewhere in this prospectus, these factors include:

This volatility may affect the price at which you could sell the shares of our common stock, and the sale of substantial amounts of our common stock could adversely affect the price of our common stock. Our stock price is likely to continue to be volatile and subject to significant price and volume fluctuations in response to market and other factors.

Sales of our common stock, or the perception that such sales may occur, could cause the market price of our common stock to fall.

We expect that we may need additional capital in the future to continue our planned operations. To the extent we raise additional capital by issuing equity securities, our stockholders may experience substantial dilution. We may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine from time to time. If we sell common stock, convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales. Such sales may also result in material dilution to our existing stockholders, and new investors could gain rights superior to our existing stockholders.

On March 3, 2026, we entered into an amended and restated sales agreement (the “Sales Agreement”) pursuant to which we may offer and sell common stock from time to time (the “ATM Program”). Investors who purchase common stock at different times will likely pay different prices and may experience different outcomes in their investment results. We will have discretion, subject to the effect of market conditions, to vary the timing, prices and numbers of shares of our common stock sold pursuant to the Sales Agreement. Investors may experience a decline in the value of their shares of common stock.

Continued sales of common stock, if any, under the ATM Program will depend upon market conditions and other factors to be determined by us and may be made in negotiated transactions or transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act. Future sales of our common stock are not guaranteed, and there are no firm commitments to receive funding under the ATM Program. The issuance from time to time of these new shares of common stock, or the perception that such sales may occur, could have the effect of depressing the market price of our common stock.

We have issued warrants exercisable for our securities, which if exercised, would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.

As of March 26, 2026, we had (i) 169,184,318 prefunded warrants outstanding, and (ii) 2,921,618 non-tradable warrants outstanding (the “Warrants”). Each of these securities are exercisable for shares of common stock at various exercises prices. If the Warrants are exercised, it will result in dilution to the then existing holders of common stock and increase the number of shares of common stock eligible for resale in the public market. Sales of substantial numbers of such shares of common stock could adversely affect the market price of our common stock.

We do not intend to pay dividends on our common stock so any returns will be limited to the value of our stock.

We currently anticipate that we will retain future earnings for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Furthermore, future debt or other financing arrangements may contain terms prohibiting or limiting the amount of dividends that may be declared or paid on our common stock. Any return to stockholders will therefore be limited to the appreciation of their stock.

Our Certificate of Incorporation, as amended (“Certificate of Incorporation”) provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all disputes between the Company and its stockholders, which could limit stockholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers or employees.

Our Certificate of Incorporation provides that unless we consent in writing to the selection of an alternative forum, the State of Delaware is the sole and exclusive forum for: (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of our Company to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law (the “DGCL”) or our Certificate of Incorporation or Bylaws, or (iv) any action governed by the internal affairs doctrine. This exclusive forum provision would not apply to suits brought to enforce any liability or duty created by the Securities Act or the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. To the extent that any such claims may be based upon federal law claims, Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder.

Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. However, our Certificate of Incorporation contains a federal forum provision which provides that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.

These choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees and may result in increased costs to our stockholders, which may discourage such lawsuits against us and our directors, officers and other employees. Alternatively, if a court were to find our choice of forum provisions contained in our Certificate of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations, and financial condition.

Our Certificate of Incorporation, Bylaws and Delaware law may have anti-takeover effects that could discourage, delay or prevent a change in control, which may cause our stock price to decline.

Our Certificate of Incorporation, our Bylaws and Delaware law could make it more difficult for a third party to acquire us, even if closing such a transaction would be beneficial to our stockholders. We are authorized to issue up to 10 million shares of preferred stock. This preferred stock may be issued in one or more series, the terms of which may be determined at the time of issuance by our board of directors without further action by stockholders. The terms of any series of preferred stock may include voting rights (including the right to vote as a series on particular matters), preferences as to dividend, liquidation, conversion and redemption rights and sinking fund provisions. The issuance of any preferred stock could materially adversely affect the rights of the holders of our common stock, and therefore, reduce the value of our common stock. In particular, specific rights granted to future holders of preferred stock could be used to restrict our ability to merge with, or sell our assets to, a third party and thereby preserve control by the present management.

Provisions of our Certificate of Incorporation, our Bylaws and Delaware law also could have the effect of discouraging potential acquisition proposals or making a tender offer or delaying or preventing a change in control, including changes a stockholder might consider favorable. Such provisions may also prevent or frustrate attempts by our stockholders to replace or remove our management. In particular, our Certificate of Incorporation, our Bylaws and Delaware law, as applicable, among other things:

Unstable market and economic conditions and adverse developments with respect to financial institutions and associated liquidity risk may have serious adverse consequences on our business, financial condition and stock price.

The global credit and financial markets have recently experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, inflationary pressure and interest rate changes, increases in unemployment rates and uncertainty about economic stability. The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the conflict between Russia and Ukraine, terrorism or other geopolitical events. Sanctions imposed by the United States and other countries in response to such conflicts, including the one in Ukraine, may also adversely impact the financial markets and the global economy, and any economic countermeasures by the affected countries or others could exacerbate market and economic instability. More recently, the closures of Silicon Valley Bank (“SVB”) and Signature Bank and their placement into receivership with the Federal Deposit Insurance Corporation (“FDIC”) created bank-specific and broader financial institution liquidity risk and concerns. Although the Department of the Treasury, the Federal Reserve, and the FDIC jointly confirmed that depositors at SVB and Signature Bank would continue to have access to their funds, even those in excess of the standard FDIC insurance limits, under a systemic risk exception, future adverse developments with respect to specific financial institutions or the broader financial services industry may lead to market-wide liquidity shortages, impair the ability of companies to access near-term working capital needs, and create additional market and economic uncertainty. There can be no assurance that future credit and financial market instability and a deterioration in confidence in economic conditions will not occur. Our general business strategy may be adversely affected by any such economic downturn, liquidity shortages, volatile business environment or continued unpredictable and unstable market conditions. If the equity and credit markets deteriorate, or if adverse developments are experienced by financial institutions, it may cause short-term liquidity risk and also make any necessary debt or equity financing more difficult, more costly and more dilutive. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon our business plans. In addition, there is a risk that one or more of our counterparties, financial institutions or other third parties with whom we do business may be adversely affected by the foregoing risks, which may have an adverse effect on our business.

Market and economic conditions may negatively impact our business, financial condition and share price.

Concerns over inflation, energy costs, geopolitical issues, the U.S. mortgage market and the real estate market, unstable global credit markets and financial conditions, and volatile oil prices have led to periods of significant economic instability, diminished liquidity and credit availability, declines in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations of slower global economic growth going forward, increased unemployment rates, and increased credit defaults in recent years. Our general business strategy may be adversely affected by any such economic downturns, volatile business environments and continued unstable or unpredictable economic and market conditions. If these conditions continue to deteriorate or do not improve, it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance, and share price and could require us to delay or abandon development or commercialization plans.

We are an emerging growth company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common stock less attractive to investors.

We are an emerging growth company, as defined in the JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding nonbinding advisory votes on executive compensation and stockholder approval of any golden parachute payments not previously approved. We could be an emerging growth company for up to five years following the year in which we completed our initial public offering, although circumstances could cause us to lose that status earlier. We will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which we have total annual gross revenue of at least $1.235 billion or (c) in which we are deemed to be a large accelerated filer, which requires the market value of our common stock that is held by non-affiliates to exceed $700.0 million as of the prior June 30th and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

We may choose to take advantage of some, but not all, of the available exemptions. We cannot predict whether investors will find our common stock less attractive if we rely on certain or all of these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

Under the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards apply to private companies, which may make our financial statements less comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. We have chosen to take advantage of the extended transition periods available to emerging growth companies under the JOBS Act for complying with new or revised accounting standards until those standards would otherwise apply to private companies provided under the JOBS Act. As a result, our financial statements may not be comparable to those of companies that comply with public company effective dates for complying with new or revised accounting standards.

Financial reporting obligations of being a public company in the U.S. are expensive and time-consuming, and our management will be required to devote substantial time to compliance matters.

As a publicly traded company we incur significant additional legal, accounting and other expenses. The obligations of being a public company in the U.S. require significant expenditures and place significant demands on our management and other personnel, including costs resulting from public company reporting obligations under the Exchange Act and the rules and regulations regarding corporate governance practices, including those under the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, and The Nasdaq Capital Market. These rules require the establishment and maintenance of effective disclosure and financial controls and procedures, internal control over financial reporting and changes in corporate governance practices, among many other complex rules that are often difficult to implement, monitor and maintain compliance with. Moreover, despite recent reforms made possible by the JOBS Act, the reporting requirements, rules, and regulations will make some activities more time-consuming and costly, particularly after we are no longer an “emerging growth company” or a “smaller reporting company.” Our management and other personnel will need to devote a substantial amount of time to ensure that we comply with all of these requirements and to keep pace with new regulations, otherwise we may fall out of compliance and risk becoming subject to litigation or being delisted, among other potential problems.

If we fail to maintain an effective system of internal controls, we may not be able to accurately determine our financial results or prevent fraud. As a result, our stockholders could lose confidence in our financial results, which could harm our business and the value of our common stock.

Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires us establish and maintain an adequate internal control structure and procedures for financial reporting and to evaluate and report on such controls.

Our internal controls and financial reporting are not subject to attestation by our independent registered public accounting firm pursuant to the exemption provided to issuers that are not “large accelerated filers” or “accelerated filers” under the Dodd-Frank Act of 2010. However, our Annual Reports on Form 10-K must contain an annual assessment by management of the effectiveness of our internal control over financial reporting and must include disclosure of any material weaknesses in internal control over financial reporting that we have identified.

We cannot be certain that we will be successful maintaining adequate internal controls over our financial reporting and financial processes in the future or remediating any material weaknesses that we identify. We may in the future discover areas of our internal controls that need improvement. Additionally, the existence of any material weakness or significant deficiency requires management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner. Furthermore, to the extent our business grows, our internal controls may become more complex, and we would require significantly more resources to ensure our internal controls remain effective.

Therefore, we cannot assure you that material weaknesses or significant deficiencies will not exist or otherwise be discovered in the future. If material weaknesses or other significant deficiencies continue to occur, such weaknesses or deficiencies could result in misstatements of our results of operations, restatements of our financial statements, a decline in the market value of our common stock, or other material adverse effects on our business, reputation, results of operations, financial condition or liquidity.

If securities or industry analysts do not publish research or reports, or publish unfavorable research or reports about our business, our stock price and trading volume may decline.

The trading market for our common stock relies in part on the research and reports that industry or financial analysts publish about us, our business, our markets and our competitors. We do not control these analysts. If securities analysts do not cover our common stock, the lack of research coverage may adversely affect the market price of our common stock. Furthermore, if one or more of the analysts who do cover us downgrade our stock or if those analysts issue other unfavorable commentary about us or our business, our stock price would likely decline. If one or more of these analysts cease coverage of us or fails to regularly publish reports on us, we could lose visibility in the market and interest in our stock could decrease, which in turn could cause our stock price or trading volume to decline and may also impair our ability to expand our business with existing customers and attract new customers.

We could be subject to securities class action litigation.

In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. This risk is especially relevant for us because pharmaceutical companies have experienced significant stock price volatility in recent years. If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business.

You should carefully consider the risks described herein and in other public filings which could materially affect our business, financial condition or future results. The risks described herein and therein are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and/or operating results. If any of the risks actually occur, our business, financial condition, and/or results of operations could be negatively affected.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 1C. CYBERSECURITY

We believe cybersecurity is critical to advancing our technological advancements. We face a multitude of cybersecurity threats that range from attacks common to most industries, such as ransomware and denial-of service. Our customers, suppliers, subcontractors, and business partners face similar cybersecurity threats, and a cybersecurity incident impacting us or any of these entities could materially adversely affect our operations, performance, and results of operations. These cybersecurity threats and related risks make it imperative that we expend resources on cybersecurity.

ITEM 2. PROPERTIES

Our executive office, which we lease on a month-to-month basis, is located at 34 Shrewsbury Ave., Suite 1C, Red Bank, New Jersey 07701. We believe that our existing facilities are suitable and adequate to meet our current needs. We intend to add new facilities or expand existing facilities as we add employees, and we believe that suitable additional or substitute space will be available as needed to accommodate any such expansion of our operations.

ITEM 3. LEGAL PROCEEDINGS

From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. Litigation is subject to inherent uncertainties and an adverse result in these or other matters may arise from time to time that may harm our business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

On January 12, 2022, our common stock began trading on The Nasdaq Capital Market under the symbol “HILS.” Prior to that time, there was no public market for our common stock. Effective as of September 25, 2023, our common stock began trading under the ticker symbol “THAR.”

On February 18, 2026, our common stock began trading under the ticker symbol “CNTN”.

Stockholders

As of March 26, 2026, there were 70 stockholders of record of our common stock. The actual number of holders of our common stock is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or held by other nominees. This number of holders of record also does not include stockholders whose shares may be held in trust by other entities.

Dividend Policy

We have never paid or declared any cash dividends on our common stock, and we do not anticipate paying any cash dividends on our common stock in the foreseeable future. We intend to retain all available funds and any future earnings to fund the development and expansion of our business. Any future determination to pay dividends will be at the discretion of our board of directors and will depend upon a number of factors, including our results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors our board of directors deems relevant.

Recent Sales of Unregistered Securities

None.

Issuer Purchases of Equity Securities

None.

ITEM 6. [RESERVED]

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion and analysis of our financial condition and plan of operations together with and our accompanying consolidated financial statements and the related notes appearing elsewhere in this Annual Report on Form 10-K. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, and those discussed in the section titled “Risk Factors” included elsewhere in this Annual Report on Form 10-K. All amounts in this report are in U.S. dollars, unless otherwise noted.

Overview

During the year ended December 31, 2025, we began a strategic shift in our business to prioritize digital asset treasury management and investment in the digital asset ecosystem, specifically the Canton Network. As described in Item 1, from 2022 through late 2025, we primarily operated as a biotechnology company developing therapeutic candidates in inflammatory and immunologic conditions. In November 2025, we undertook a strategic shift to prioritize a disciplined digital asset treasury strategy.

In connection with this shift, in November 2025 we completed a private placement offering, strengthening our liquidity and supporting our digital asset treasury strategy. Concurrently, we entered into an at-the-market equity program and established a shelf registration statement. In January 2026, we completed a registered direct offering of common stock and pre-funded warrants, further strengthening our capital position.

Our digital asset treasury strategy is centered on acquiring, holding and deploying Canton Coin (“CC”) and supporting the Canton Network through validator operations, application support and ecosystem participation.

Our results of operations for the year ended December 31, 2025 reflect our two reportable segments: legacy biotechnology operations, and our digital asset treasury strategy initiated in November 2025. See Note 10 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional segment financial performance information.

Components of Results of Operations

Revenue

We have not recognized revenue since inception or for the years ended December 31, 2025 and 2024.

Research and Development Expenses

Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials, and manufacture drug supplies and materials as well as stock-based compensation for our research and development personnel. Research and development expenses are charged to operations as incurred.

We accrue costs incurred by external service providers, including contract research organizations and clinical investigators, based on estimates of service performed and costs incurred. These estimates include the level of services performed by third parties, patient enrollment in clinical trials, administrative costs incurred by third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, we may also record payments made to those providers as prepaid expenses that will be recognized as expense in future periods as the related services are rendered.

We have incurred research and development expenses related to the development of HSB-1216, which has been deprioritized. We expect that our research and development expenses will increase as we plan for and commence our clinical trials of HS3215 and HS1940.

We cannot determine with certainty the duration and costs of future clinical trials of our product candidates, HS3215 and HS1940, or any other product candidates we may develop or if, when or to what extent we will generate revenue from the commercialization and sale of any of our product candidates for which we obtain marketing approval. We may never succeed in obtaining marketing approval for any of our product candidates. The duration, costs and timing of clinical trials and development of our current and future product candidates will depend on a variety of factors, including:

A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the FDA or another regulatory authority were to require us to conduct clinical trials beyond those that we anticipate will be required for the completion of clinical development of a product candidate, or if we experience significant delays in our clinical trials due to slower than expected patient enrollment or other reasons, we would be required to expend significant additional financial resources and time on the completion of clinical development.

General and Administrative Expenses

General and administrative expenses consist primarily of compensation and consulting related expenses, including stock-based compensation for our general and administrative personnel. General and administrative expenses also include professional fees and other corporate expenses, including legal fees relating to corporate matters; professional fees for accounting, auditing, tax, and consulting services; insurance costs; travel expenses and other operating costs that are not specifically attributable to research activities. General and administrative expenses also include expenses related to our canton-centric digital asset treasury strategy.

We expect that our general and administrative expenses will increase in the future as we increase our personnel headcount to support our digital asset treasury strategy and continued research activities and development of our product candidates. We also incur expenses associated with being a public company, including expenses related to compliance with the rules and regulations of the SEC and Nasdaq, directors and officers insurance expenses, corporate governance expenses, investor relations activities and other administrative and professional services.

Interest Income

Interest income consists of interest income from funds held in our cash accounts.

Unrealized Loss from Digital Asset Holdings

The unrealized gain (loss) from digital assets holdings represents the change in fair value of our digital assets. We use a USD/CC reference price from a crypto market data provider for purposes of periodic fair value remeasurement.

Results of Operations

Comparison of the Years Ended December 31, 2025 and 2024

The following table sets forth key components of our results of operations for the years ended December 31, 2025 and 2024.

Research and Development Expenses

The table below summarizes by program our research and development expenses for the periods presented:

Research and development expenses decreased by $3.3 million, or 52%, to $3.1 million for the year ended December 31, 2025 from $6.4 million for year ended December 31, 2024. The decrease was primarily the result of decreases in (i) clinical trial expenses of approximately $1.6 million due to completion of our Phase 1 clinical trial and offset by start-up costs related to our Phase 2 clinical trial in GV104, (ii) license fees of $1.5 million, (iii) pre-clinical expenses of $0.9 million. These decreases were offset by an increase of $0.3 million in CMC expenses and an increase of $0.1 million in stock-based compensation expense and $0.2 million in wages related to our research and development personnel.

General and Administrative Expenses

General and administrative expenses increased by $11.0 million, or 182%, to $17.0 million for the year ended December 31, 2025 from $6.0 million for the year ended December 31, 2024. The change in general and administrative expenses was primarily due to increases of (i) $7.3 million in general and administrative personnel expenses including bonuses, (ii) $1.5 million in investor relations, (iii) $2.0 million in stock-based compensation expense related to our general and administrative personnel (iv) $0.2 million in public company expenses, and (v) $0.1 million in other general corporate. These increases were offset by a decrease in professional fees of $0.2 million.

Interest Expense

Interest expense increased by $14,661, or 107%, to $28,345 for the year ended December 31, 2025 from $13,684 for the year ended December 31, 2024. The increase in interest expense was primarily related to the director and officer insurance premium financing liability as well as a note payable which was fully paid as of December 31, 2025.

Interest Income

Interest income decreased by approximately $0.2 million, or 83%, to less than $0.1 million for the year ended December 31, 2025 from $0.3 million for year ended December 31, 2024. The decrease in interest income was primarily due to the decrease in cash during 2025 and a decrease in interest rates.

Unrealized Loss from Digital Assets Holdings

Unrealized loss from digital assets holdings increased to $22.0 million for the year ended December 31, 2025 from $0 for year ended December 31, 2024. This was the result of the contribution of digital assets from the Cryptocurrency Offering in November 2025 and subsequent digital asset purchases, where the reference price of CC as of December 31, 2025 was less than the weighted average cost of our CC holdings.

Liquidity and Capital Resources

The accompanying consolidated financial statements have been prepared on the basis that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. During the year ended December 31, 2025, we incurred operating losses in the amount of approximately $20.0 million, expended approximately $16.0 million in net cash used in operating activities, and had an accumulated deficit of approximately $72.8 million as of December 31, 2025. Through December 31, 2025, we have primarily financed operations through public and private offerings of equity securities.

During the year ended December 31, 2024, we sold 203,359 shares of our common stock pursuant to the 2024 ATM Agreement for net proceeds of approximately $0.3 million, after deducting commissions of $15,506 and other offering fees of $41,952. During the year ended December 31, 2025, we sold 1,657,799 shares of our common stock pursuant to the 2025 ATM Agreement for net proceeds of approximately $5.1 million, after deducting commissions of approximately $0.1 million.

Further, on June 17, 2024, December 9, 2024, June 13, 2025, and July 25, 2025, we closed private placement offerings (the “June 2024 PIPE Offering,” “December 2024 PIPE Offering,” “June 2025 PIPE Offering,” and the “July 2025 PIPE Offering,” respectively) with certain accredited investors, consisting of shares of our common stock and/or pre-funded warrants to acquire shares of our common stock and common warrants to acquire shares of our common stock. The combined net proceeds received from these offerings was approximately $7.0 million.

In addition, on July 23, 2025 and August 26, 2025, we closed registered direct public offerings (the “July 2025 Direct Offering” and the “August 2025 Direct Offering”) with certain investors, consisting of shares of our common stock and/or pre-funded warrants to acquire shares of our common stock and common warrants to acquire shares of our common stock, with combined net proceeds of approximately $6.3 million.

In November 2025, we closed the Cash Offering for net proceeds of approximately $90.9 million in cash and the Cryptocurrency Offering for net proceeds of approximately $446.2 million in cryptocurrency.

In the prior reporting period, we identified certain conditions that raised substantial doubt about our ability to continue as a going concern. These conditions included our limited operating history, recurring operating losses, and recurring negative cash flows from operations as described above. However, on November 3, 2025, we raised net proceeds of over $537 million through a private placement offering. As a result, we believe we now have sufficient liquidity to fund anticipated cash requirements for operations and working capital purposes through at least March 2027. As a result, the previously disclosed going concern uncertainty language has been removed as substantial doubt no longer exists regarding our ability to continue as a going concern.

Cash Flow Activities for the Years Ended December 31, 2025 and 2024

The following table sets forth a summary of our cash flows for the periods presented.

Cash Flows from Operating Activities

Cash used in operating activities for the year ended December 31, 2025 was $16.0 million which consisted of net loss of $42.1 million, partially offset by non-cash stock-based compensation of approximately $2.9 million, unrealized loss from digital asset holdings of approximately $22.0 million, write-off of deferred offering costs of $0.1 million, and net changes in operating assets and liabilities of approximately $1.1 million.

Cash used in operating activities for the year ended December 31, 2024 was $10.9 million which consisted of net loss of $12.2 million, partially offset by non-cash stock-based compensation of approximately $0.7 million, non-cash stock issuance pursuant to a services agreement of less than $0.1 million, and net changes in operating assets and liabilities of approximately $0.6 million.

Cash Flows from Investing Activities

Cash used in investing activities for the year ended December 31, 2025 was $77.6 million, representing the purchase of digital assets. There were no cash flows from investing activities during the year ended December 31, 2024.

Cash Flows from Financing Activities

Cash provided by financing activities for the year ended December 31, 2025 was $107.2 million. The net increase in financing activities was due to proceeds from the Cash Offering of $99.4 million, proceeds from the PIPE offerings of $3.7 million, proceeds from the registered direct public offerings of $7.1 million, proceeds from the ATM offerings of $5.5 million, proceeds from the exercise of warrants of $1.5 million and proceeds from option exercises of $0.2 million. These increases were offset by payments of deferred offering and other issuance costs of $10.0 million and repayment of note payable of $0.2 million.

Cash provided by financing activities for the year ended December 31, 2024 was $3.5 million. The net increase in financing activities was due to proceeds from the PIPE Offerings of $4.1 million, proceeds from the ATM Sale of $0.1 million and insurance premium financing liability of $0.4 million, offset by payments of deferred offering costs of $0.7 million and repayments of insurance premium financing liability of $0.4 million.

Reverse Stock Split

On May 24, 2024, the Company effectuated an additional reverse split of shares of its common stock at a ratio of 1-for-15 pursuant to an amendment to the Company’s Certificate of Incorporation, as amended, filed with the Delaware Secretary of State and approved by the Company’s board of directors and stockholders. The par value of the Company’s common stock was not adjusted as a result of the reverse split. All issued and outstanding common stock share and per share amounts contained in the accompanying consolidated financial statements have been retroactively adjusted to reflect the reverse split for all periods presented.

Critical Accounting Policies and Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Management bases its estimates on historical experience and on assumptions believed to be reasonable under the circumstances. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes, and management must select an amount that falls within that range of reasonable estimates. We consider the following areas to be our critical accounting estimate: fair value of digital assets, research and development expense recognition, stock-based compensation, allowances of deferred tax assets, and cash flow assumptions regarding going concern considerations. Although management believes the estimates that have been used are reasonable, actual results could vary from the estimates that were used.

Critical Accounting Policies

Digital Assets

We account for digital assets, which are comprised of CC, as indefinite-lived intangible assets in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350-60, Intangibles—Goodwill and Other-Crypto Assets. Our digital assets are initially recorded at cost. Subsequently, they are measured at fair value with the gain or loss associated with remeasurement of the digital assets recognized in net income (loss) during each reporting period. Upon disposal of a digital asset (e.g., by sale, exchange or transfer), we derecognize the asset and recognize a realized gain or loss in net income, calculated as the difference between the sale proceeds and the asset’s carrying amount.

The fair value of the digital assets is determined based on the quoted price in its principal market at the time of measurement. We determine its principal market as the market that it has access to and has the greatest volume and level or orderly transactions in accordance with FASB ASC 820, Fair Value Measurement. We track the cost of its digital assets using the first-in-first-out (FIFO) method.

Research and development

Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. We accrue for costs incurred by external service providers, including contract research organizations and clinical investigators, based on our estimates of service performed and costs incurred. These estimates include the level of services performed by third parties, patient enrollment in clinical trials, administrative costs incurred by third parties, and other indicators of the services completed.

Stock-based compensation

Stock-based compensation represents the cost related to stock-based awards granted to our employees, directors, consultants, and affiliates. We measure stock-based compensation costs at the grant date, based on the estimated fair value of the award and recognize the cost over the requisite service period.

We recognize compensation costs resulting from the issuance of stock-based awards to employees, non-employees and directors as an expense in the consolidated statements of operations over the requisite service period based on a measurement of fair value for each stock-based award. The fair value of each option grant to employees, non-employees and directors is estimated as of the date of grant using the Black-Scholes option-pricing model, net of actual forfeitures. The fair value is amortized as compensation cost on a straight-line basis over the requisite service period of the awards, which is generally the vesting period.

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. Prior to January 12, 2022, we were a private company and our common stock has only been publicly traded since that date. As a result, we lack company-specific historical and implied volatility information. Therefore, we have estimated our expected stock price volatility based on the historical volatility of a publicly traded set of peer companies. The expected term of stock options granted was between five and seven years. The risk-free interest rate was determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award.

Recently Issued and Adopted Accounting Standards

See Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

JOBS Act

On April 5, 2012, the Jumpstart Our Business Startups Act (the “JOBS Act”) was enacted. Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.

We have chosen to take advantage of the extended transition periods available to emerging growth companies under the JOBS Act for complying with new or revised accounting standards until those standards would otherwise apply to private companies provided under the JOBS Act. As a result, our financial statements may not be comparable to those of companies that comply with public company effective dates for complying with new or revised accounting standards.

Subject to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions, including, without limitation, (i) providing an auditor’s attestation report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended, and (ii) complying with the requirement adopted by the Public Company Accounting Oversight Board regarding the communication of critical audit matters in the auditor’s report on financial statements. We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.235 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of our IPO; (iii) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The Company is not required to provide the information required by this Item as it is a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this item is presented at the end of this Annual Report on Form 10-K beginning on page F-1 and is incorporated herein by reference. An index of those financial statements is found in Part IV, Item 15, Exhibits, Financial Statement Schedules, of this Annual Report on Form 10-K.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls

Our principal executive officer and principal financial officer evaluated the effectiveness of our “disclosure controls and procedures” as of December 31, 2025, the end of the period covered by this Annual Report on Form 10-K. The term “disclosure controls and procedures” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files under the Exchange Act is accumulated and communicated to a company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Based on the evaluation of our disclosure controls and procedures as of December 31, 2025, our Chief Executive Officer and our Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective.

Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Exchange Act Rule 13a-15(f). Internal control over financial reporting is a process designed under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. GAAP. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

As of December 31, 2025, our principal executive officer and principal financial officer, conducted an evaluation of the effectiveness of our internal control over financial reporting based on the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework - 2013. Based on this assessment and implementation of our remediation plans, management concluded that, as of December 31, 2025, our internal controls over financial reporting were effective.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to the exemption provided to issuers that are not “large accelerated filers” nor “accelerated filers” under the Dodd-Frank Wall Street Reform and Consumer Protection Act as well as issuers that are “emerging growth companies” under the JOBS Act.  

Changes in Internal Control Over Financial Reporting

Except as set forth above, there were no changes in our internal control over financial reporting that occurred during the year ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

During the quarter ended December 31, 2025, none of our directors or executive officers adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” as such terms are defined under Rule 408 of Regulation S-K.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.

Not applicable.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

BOARD OF DIRECTORS

Set forth below is information concerning the current members of the Board of Directors (the “Board”) of the Company, including their ages as of March 26, 2026, present principal occupations, other business experiences during at least the last five years, membership on standing committees of the Board, public company directorships held during the last five years and certain other directorships.

Mark Wendland

Mark Wendland has served as a member of our board of directors since November 2025. Mr. Wendland is currently the Chairman of the Board. He was appointed as Chief Executive Officer of the Company and as a director of the Board effective November 6, 2025. Prior to that, Mr. Wendland served in various roles at DRW Holdings LLC, a proprietary trading firm, from July 2019 to June of 2025. Mr. Wendland served as Partner from January 2023 to June 2025, Chief Operating Officer from September 2021 to June of 2025, and Global Treasurer from July 2019 to September 2021. Prior to his time at DRW Holdings LLC, Mr. Wendland served as a Global Treasury Manager at Citadel LLC, a hedge fund and financial services company from September 2003 to January 2019. Mr. Wendland received his B.S. in Business Administration from Carroll College.

Sireesh Appajosyula

Sireesh Appajosyula has served as a member of our board of directors since July 2021 and was appointed as our Chief Operating Officer in July 2023. Since April 2020, he has served as SVP, Corporate Development and Operations of 9 Meters Biopharma, Inc. (Nasdaq: NMTR) (“9 Meters”), a company focused on rare and unmet needs in gastrointestinal patient populations developing compounds with unique gastrointestinal biology, and since 2018 he has served as Managing Member of Highpoint Pharmaceuticals, LLC, a pharmaceutical research and development company. In addition, since 2015, Mr. Appajosyula has served as Managing Partner of Channel BioConsulting, LLC, a company that assists in enhancing search and evaluation efforts for complementary assets to be added to existing portfolios of biopharmaceutical companies. Prior to joining 9 Meters, Mr. Appajosyula spent approximately 8 years at Salix Pharmaceuticals, Inc. (“Salix”) (Nasdaq: SLXP) in various roles in medical affairs, product commercialization and business development until its acquisition by Bausch Health (Nasdaq: BHC). Prior to Salix, he was involved in various roles at Amgen Inc., Critical Therapeutics, Inc. and Sanofi (formerly Aventis). Mr. Appajosyula received his Bachelor of Science and Doctor of Pharmacy from Rutgers University. We believe Mr. Appajosyula is qualified to serve as a member of our board of directors because of his extensive experience in the biotechnology industry.

Vincent LoPriore

Vincent LoPriore has served as a member of our board of directors since April 2025. Mr. LoPriore is an experienced financial professional with over 30 years of experience in the investment banking industry. He began his career at Oppenheimer & Co. in 1989 and subsequently held senior positions at Legg Mason, Inc. and partner at C.E. Unterberg, Towbin, where he led the special equities group and completed more than $150 million in private placement transactions. He has served in leadership roles at various boutique and mid-sized investment firms, focusing on capital raising, regulatory navigation. Mr. LoPriore is currently a Partner and licensed representative at President Street Global, LLC, a FINRA-registered broker-dealer. He also serves as the investment manager of the Gravitas Capital LP Fund, with a track record of strong investment performance. Mr. LoPriore has longstanding relationships within the biomedical industry and supports philanthropic initiatives including Race to Erase MS and Cure Addiction Now. Mr. LoPriore’s extensive investment banking experience and sector expertise support his qualifications to serve on the Board of Directors.

Clay Kahler

Clay Kahler has served as a member of our board of directors since April 2025. Mr. Kahler is an entrepreneur and executive with experience across life sciences, biotechnology, and emerging technologies. He is the Co-founder, Chief Executive Officer, and Managing Director of Spray Labs, LLC, an FDA-registered, cGMP-certified manufacturer specializing in oral spray drug delivery systems, and the Founder and Chief Executive Officer of Gateway Sciences LLC, focused on mental health and regenerative medicine. Mr. Kahler co-founded Helius Medical Technologies, Inc. (NASDAQ: HSDT), where he contributed to early-stage financing, capital markets strategy, and public market development, including a Cooperative Research and Development Agreement (CRADA) with the U.S. Army. Helius achieved significant public market scale during his involvement. He has also been active in U.S. and Canadian public markets across innovative life sciences and emerging technologies, including Gener8 Digital Media Corp., where he supported strategic initiatives leading to the sale of its studio assets to Reliance MediaWorks, part of a global media group, and Velocity Mobile Limited (Velocity Black), which was acquired by Capital One Financial Corporation (NYSE: COF) in 2023. Mr. Kahler’s extensive experience in corporate leadership, capital markets, life sciences, and innovative technologies supports his qualifications to serve on the Board of Directors.

Gary Stetz

Gary Stetz has served as a member of our board of directors since April 2025. Mr. Stetz is a Certified Public Accountant with over 35 years of experience across accounting, finance, business valuation and corporate governance. Mr. Stetz currently serves as Managing Partner of Stetz, Belgiovine, Manwarren and Wallis P.C., an accounting, auditing, tax compliance and advisory services firm with more than 1,000 corporate clients. His extensive leadership experience includes founding Allegiance Community Bank and serving on the Board of BCB Bancorp. He is co-author of the book Project Management Accounting. He has earned multiple professional credentials, including Certified Mediator, Certified Fraud Examiner, and Chartered Global Management Accountant Mr. Stetz’s extensive expertise in financial forensics, valuation, and regulatory compliance will provide valuable oversight as Canton Strategic continues to build a strong financial and operational foundation. Mr. Stetz’s extensive financial, accounting, and governance experience supports his qualifications to serve on the Board of Directors.

Jill E. Sommers

Ms. Sommers is an experienced regulatory and public policy professional with nearly three decades of experience in the derivatives and financial markets. She previously served as the Chair of the Derivative Practice Group of Patomak Global Partners until March 2025. Ms. Sommers also served two consecutive terms as a Commissioner of the Commodity Futures Trading Commission from 2007 to 2013. Earlier in her career, Ms. Sommers held senior policy and regulatory roles, including serving as Policy Director and Head of Government Affairs at the International Swaps and Derivatives Association and as Managing Director of Regulatory Affairs at the Chicago Mercantile Exchange. Ms. Sommers currently serves on the boards of directors of Robinhood VF, Miami International Holdings as well as other private companies. She has also served as a board member of Cboe Global Markets, Inc. and the National Futures Association. Ms. Sommers holds a B.A. in Political Science from the University of Kansas. Ms. Sommers brings to the Board extensive experience in derivatives regulation, corporate governance, and public policy. The Board believes that this experience and perspective make her well qualified to serve as a director.

William Wiley

Mr. Wiley has served as Head of the Equities and Latency Sensitive Business Unit of DRW Holdings, LLC (“DRW”) since October 2025 and has also served as Chief of Staff to DRW’s Founder and Chief Executive Officer since February 2025. From August 2022 to October 2025, Mr. Wiley served as Chief Operating Officer of DRW’s Equities and Latency Sensitive Business Unit, overseeing day-to-day operations and scaling a global, multi-asset electronic trading platform. Prior to DRW, Mr. Wiley served as Global Head of Strategy at Instinet Holdings Inc. (“Instinet”) from April 2018 to August 2022, where he was a member of Instinet’s Global Executive Committee and led firmwide strategy, operations, and strategic transactions across the institutional equities brokerage franchise. From 2010 to 2017, Mr. Wiley held a series of roles at KCG Holdings, Inc. (“KCG”), including Chief Operating Officer of Client Execution Services from September 2013 to July 2017. Mr. Wiley received a B.S. in Business Administration and a B.S. in Economics from Villanova University and is a Chartered Financial Analyst (CFA) charterholder. Mr. Wiley’s extensive experience in capital markets and steering business strategies, together with his track record leading complex global operations, qualifies him to serve on our board.

Corporate Governance

We are committed to good corporate governance practices. These practices provide an important framework within which our Board of Directors and management pursue our strategic objectives for the benefit of our stockholders.

Board Composition and Leadership Structure

Although the Company does not have a formal policy regarding the separation of its Chair and Chief Executive Officer positions, Mark Wendland serves as Chief Executive Officer of the Company and the Chairman of the Board. Due to the size of our Company, we believe that this structure is appropriate. We believe that the fact that four of the seven members of the Board are independent reinforces the independence of the Board in its oversight of our business and affairs, and provides for objective evaluation and oversight of management’s performance, as well as management accountability.

Board’s Role in Risk Oversight

Our Board of Directors believes that open communication between management and the Board of Directors is essential for effective risk management and oversight. Our Board of Directors meets with our Chief Executive Officer and other members of the senior management team at periodic Board of Director meetings, where, among other topics, they discuss strategy and risks in the context of reports from the management team and evaluate the risks inherent in significant transactions. While our Board of Directors is ultimately responsible for risk oversight, our Board committees assist the Board of Directors in fulfilling its oversight responsibilities in certain areas of risk. The audit committee assists our Board of Directors in fulfilling its oversight responsibilities with respect to risk management in the areas of major financial risk exposures, internal control over financial reporting, disclosure controls and procedures and legal and regulatory compliance. The compensation committee assists our Board of Directors in assessing risks created by the incentives inherent in our compensation policies. The nominating and corporate governance committee assists our Board of Directors in fulfilling its oversight responsibilities with respect to the management of corporate, legal and regulatory risk.

Committees of our Board of Directors

Our Board of Directors has established an audit committee, a compensation committee and a nominating and corporate governance committee, each of which has the composition and responsibilities described below. Members serve on these committees until their resignation or until otherwise determined by our Board of Directors. Each of these committees has a written charter, copies of which are available without charge on our website at www.cantonstrategic.com. In addition from time to time, special committees may be established under the direction of the Board of Directors when necessary to address specific issues.

Audit Committee

Our audit committee is responsible for, among other things:

Our audit committee currently consists of Gary Stetz (as the Chair), Clay Kahler and Jill E. Sommers.

Our board of directors has affirmatively determined that Clay Kahler, Gary Stetz and Jill E. Sommers each meet the definition of “independent director” under Nasdaq rules, and that they meet the independence standards under Rule 10A-3. Each member of our audit committee meets the financial literacy requirements of Nasdaq. In addition, our board of directors has determined that Gary Stetz qualifies as an “audit committee financial expert,” as such term is defined in Item 407(d)(5) of Regulation S-K.

Compensation Committee

Our compensation committee is responsible for, among other things:

Our compensation committee currently consists of Gary Stetz (as the Chair), Clay Kahler, and Jill E. Sommers. Our board has determined that Gary Stetz, Clay Kahler and Jill E. Sommers are each independent directors under Nasdaq rules.

Nominating and Governance Committee

Our nominating and governance committee is responsible for, among other things:

Currently, our nominating and corporate governance committee consists of Gary Stetz, Clay Kahler (as the Chair), and Jill E. Sommers. Our Board has determined that Gary Stetz, Clay Kahler and Jill E. Sommers are each independent directors under Nasdaq rules.

Code of Business Conduct and Ethics

We have adopted a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the code is filed as an exhibit to our Annual Report on Form 10-K. We intend to post on our website all disclosures that are required by law or Nasdaq rules concerning any amendments to, or waivers from, any provision of the code.

Anti-hedging

As part of our Insider Trading Policy, all of our officers, directors, employees and consultants and family members or others sharing a household with any of the foregoing or that may have access to material non-public information regarding our Company are prohibited from engaging in short sales of our securities, any hedging or monetization transactions involving our securities and in transactions involving puts, calls or other derivative securities based on our securities. Our Insider Trading Policy further prohibits such persons from purchasing our securities on margin, borrowing against any account in which our securities are held or pledging our securities as collateral for a loan unless pre-cleared by our Insider Trading Compliance Officer.

Family Relationships

There are no family relationships among any of our executive officers or directors.

Arrangements between Officers and Directors

Except as set forth herein regarding Mr. Toomey and Mr. Wendland, to our knowledge, there is no arrangement or understanding between any of our officers or directors and any other person pursuant to which such officer or director was selected to serve as an officer or director of the Company.

Involvement in Certain Legal Proceedings

We are not aware of any of our directors or officers being involved in any legal proceedings in the past ten years relating to any matters in bankruptcy, insolvency, criminal proceedings (other than traffic and other minor offenses), or being subject to any of the items set forth under Item 401(f) of Regulation S-K.

Policy for the Recovery of Erroneously Awarded Compensation

Our Board adopted a Policy for the Recovery of Erroneously Awarded Compensation. The policy provides that the Company must promptly recover specified incentive-based compensation that is received by our Section 16 officers on or after October 2, 2023, regardless of fault or misconduct, upon specified accounting restatements of the Company’s financial statement that resulted in such persons receiving an amount that exceeded the amount that would have been received if based on the restated financial statements. There are limited exceptions to the recovery requirement as set forth in the listing standards. Incentive-based compensation is defined as any compensation that is granted, earned, or vested based wholly or in part upon the attainment of a financial reporting measure. The subject compensation will be determined without regard to any net settlement of, or taxes paid or payable or withheld on, such compensation, but there will not be any duplicative recovery by the Company. As specified in the listing standards, the Company cannot indemnify, or pay or reimburse for insurance for, a Section 16 officer for recoveries under this policy.

The recovery period under the policy is three full years preceding the date our Board or a committee thereof as directed by the Board concludes, or reasonably should have concluded, that an accounting restatement is required. If applicable, the Company will provide the current or former Section 16 officer with a written demand for repayment or return and the method thereof. If such repayment or return is not made when due, the policy provides that the Company will take all reasonable and appropriate actions to recover such erroneously awarded compensation from such person.

EXECUTIVE OFFICERS

Our executive officers as of December 31, 2025, and their respective ages, are as follows:

Mark Wendland

Biographical information pertaining to Mr. Wendland, who is both an executive officer and a director of the Company, can be found in “Board of Directors” above.

Mark Toomey

Mark Toomey was appointed as President of the Company effective November 6, 2025. Since March 2025, Mr. Toomey has served as the Managing Director and Head of Business Development for Liberty City Ventures, a venture capital firm that focuses on investing in early-stage blockchain and technology companies. Prior to his time at Liberty City Ventures, Mr. Toomey served as the Head of Distribution for Galaxy Digital, a digital asset and artificial intelligence company, from March 2021 to March 2025. Prior to Galaxy Digital, Mr. Toomey served as the Head of Pensions, Endowments and Foundations at J.P. Morgan from 2019 to March 2021. Prior to his time at J.P. Morgan, Mr. Toomey served as the Managing Director and Head of Institutional Equity Derivatives at Goldman Sachs. Mr. Toomey received his B.A. in American Studies from Syracuse University and his MBA from Georgetown University.

Jacob Asbury

Jacob Asbury was appointed as Chief Financial Officer of the Company effective December 10, 2025. Mr. Asbury served as Chief Financial Officer of Clear Street Group, Inc. from September 2021 to December 2023, after which he led an independent advisory practice focused on financial systems implementation, reporting optimization, and process automation from January 1, 2024 to date. Mr. Asbury also served as Chief Financial Officer of Performance Flight & Custom Jet Charters from June 2020 to September 2021, and as Chief Financial Officer of Instinet Incorporated from 2010 to 2020. Mr. Asbury holds a bachelor’s degree from the University of Vermont.

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our executive officers and directors, our principal accounting officer and persons who beneficially own more than 10% of our common stock to file with the SEC reports of their ownership and changes in their ownership of our common stock. To our knowledge, based solely on review of the copies of such reports and amendments to such reports with respect to the year ended December 31, 2025, filed with the SEC and on written representations by our directors and executive officers, all required Section 16 reports under the Exchange Act for our directors, executive officers, principal accounting officer and beneficial owners of greater than 10% of our common stock were filed on a timely basis during the year ended December 31, 2025, except that one Form 4 was inadvertently filed late on July 7, 2025 on behalf of Anderson Kelly; one Form 3 was inadvertently filed late on August 29, 2025 on behalf of Rickel Nancy Davis; one Form 3 was inadvertently filed late on August 22, 2025 on behalf of Kahler Thomas Clay; one Form 3 was inadvertently filed late on behalf of Liddy James Gordon; one Form 3 was inadvertently filed late on August 20, 2025 on behalf of LoPriore Vincent; and one Form 3 was inadvertently filed late on August 20, 2025 on behalf of Stetz Gary S.

ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation Table

For the fiscal year ended December 31, 2025, the Company’s principal executive officers and additional officers (collectively the “named executive officers”) were: