Company: ARTL
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001640334-25-001429
Chunk: 357

Company: ARTELO BIOSCIENCES, INC.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 4
Chunk 357
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 using our SOL holdings. These types of SOL-related transactions are the subject of enhanced regulatory oversight. These and any other SOL-related transactions we may enter into, beyond simply acquiring and holding SOL, may subject us to additional regulatory compliance requirements and scrutiny, including under federal and state money services regulations, money transmitter licensing requirements and various commodity and securities laws and regulations.

Increased enforcement activity and changes in the regulatory environment, including evolving or changing interpretations and the implementation of new or varying regulatory requirements by the government or any new legislation affecting SOL, as well as enforcement actions involving or impacting our trading venues, counterparties and custodians, may impose significant costs or significantly limit our ability to hold and transact in SOL.

In addition, private actors that are wary of SOL or the regulatory concerns associated with SOL have in the past taken and may in the future take further actions that may have an adverse effect on our business or the market price of our listed securities. For example, it is possible that a financial institution could restrict customers from buying our securities if it were to determine that the value of our securities is closely tied to the performance of SOL, signaling a reluctance to facilitate exposure to virtual currencies.

We plan to use a portion of our capital raised that is not required to provide working capital for our ongoing operations to acquire SOL, which may adversely affect our financial results and the market price of our securities.

We have applied the net proceeds from recent financings to acquire SOL and may do so again in the future. Net proceeds from the exercise of certain warrants will be used for general corporate and working capital purposes in an amount required to cure any existing trading market deficiency and/or to maintain an operating budget of twelve months of cash, with any remaining proceeds available for acquisition of SOL. The price of SOL has been subject to dramatic price fluctuations and is highly volatile. Moreover, digital assets 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 our SOL holdings. Further, the acquisition of large amounts of SOL may become difficult or more costly, which would make it more difficult for us to implement our strategy.

Any decrease in the fair value of SOL below our carrying value for such assets could require us to incur an impairment charge, and such a 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