# EDGAR Filing Document

**Accession Number:** 0001174891
**File Stem:** 0001493152-26-014045
**Filing Date:** 2026-3
**Character Count:** 334603
**Document Hash:** b1298b8f33f42fb80e1460aed9161b52
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-26-014045.hdr.sgml**: 20260331

**ACCESSION NUMBER**: 0001493152-26-014045

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 60

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260331

**DATE AS OF CHANGE**: 20260331

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** CalEthos, Inc.
- **CENTRAL INDEX KEY:** 0001174891
- **STANDARD INDUSTRIAL CLASSIFICATION:** REAL ESTATE INVESTMENT TRUSTS [6798]
- **ORGANIZATION NAME:** 05 Real Estate & Construction
- **EIN:** 000000000
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-50331
- **FILM NUMBER:** 26820863

**BUSINESS ADDRESS:**
- **STREET 1:** THREE SUGAR CREEK CENTER
- **STREET 2:** SUITE 100
- **CITY:** SUGAR LAND
- **STATE:** TX
- **ZIP:** 77478
- **BUSINESS PHONE:** 713-929-3863

**MAIL ADDRESS:**
- **STREET 1:** THREE SUGAR CREEK CENTER
- **STREET 2:** SUITE 100
- **CITY:** SUGAR LAND
- **STATE:** TX
- **ZIP:** 77478

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** RealSource Residential, Inc
- **DATE OF NAME CHANGE:** 20130814

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** UPSTREAM BIOSCIENCES INC.
- **DATE OF NAME CHANGE:** 20090422

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** FORCE ENERGY CORP.
- **DATE OF NAME CHANGE:** 20090415

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-K**

(Mark One)

☒ **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 UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**Commission file number** 000-50331

**CalEthos, Inc.**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Nevada** | **98-0371433** |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification No.) |

---

---

| | |
|:---|:---|
| **11753 Willard Avenue Tustin, California** | **92782** |
| (Address of principal executive offices) | (Zip Code) |

---

Registrant's telephone number, including area code: (714) 352-5315

Securities registered under Section 12(b) of the Act:

None N/A <br> Title of each class Name of each exchange on which registered

Securities registered under Section 12(g) of the Act:

Common Stock, $0.001 par value

(Title of class)

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

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

Indicate by checkmark whether the registrant has (1) 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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes ☒ No ☐

Indicate by checkmark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

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 definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> Emerging growth company ☐

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 in Rule 12b-2 of the Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common stock, other than shares held by persons who may be deemed affiliates of the registrant, as of June 30, 2025, the last day of the registrant's most recently completed second fiscal quarter, was $8,359,069, computed by reference to the closing sales price for the registrant's common stock on June 30, 2025, as reported on The OTCQB Market.

As of March 16, 2026, there were 25,730,540 outstanding shares of the registrant's common stock, par value $0.001 per share.

**CalEthos, Inc.**

**Annual Report on Form 10-K**

**For the Fiscal-Year Ended December 31, 2025**

**TABLE OF CONTENTS**

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| | | |
|:---|:---|:---|
|  |  | Page |
| [Cautionary Note Regarding Forward Looking Statements](#a_024) | [Cautionary Note Regarding Forward Looking Statements](#a_024) | ii |
| PART I |  |  |
| Item 1. | [Business.](#a_001) | 1 |
| Item 1A. | [Risk Factors.](#a_002) | 6 |
| Item 1B. | [Unresolved Staff Comments](#a_003) | 6 |
| Item 1C. | [Cybersecurity](#a_004) | 6 |
| Item 2. | [Properties.](#a_005) | 6 |
| Item 3. | [Legal Proceedings.](#a_006) | 6 |
| Item 4. | [Mine Safety Disclosures](#a_007) | 6 |
| [PART II](#a_008) |  |  |
| Item 5. | [Market for Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Market Information.](#a_009) | 7 |
| Item 6. | [Selected Financial Data.](#a_025) | 7 |
| Item 7. | [Management's Discussion and Analysis of Financial Condition and Result of Operations.](#a_010) | 8 |
| Item 7A. | [Quantitative and Qualitative Disclosures about Market Risk.](#a_011) | 12 |
| Item 8. | [Financial Statements and Supplementary Data.](#a_012) | 12 |
| Item 9. | [Changes In and Disagreements with Accountants On Accounting and Financial Disclosure.](#a_013) | 12 |
| Item 9A. | [Controls and Procedures.](#a_014) | 12 |
| Item 9B. | [Other Information.](#a_015) | 13 |
| [PART III](#a_016) |  |  |
| Item 10. | [Directors, Executive Officers, Promoters and Control Persons; Compliance With Section 16(A) of the Exchange Act.](#a_017) | 14 |
| Item 11. | [Executive Compensation](#a_018) | 16 |
| Item 12. | [Security Ownership of Certain Beneficial Owners and Management](#a_019) | 23 |
| Item 13. | [Certain Relationships and Related Transactions and Director Independence.](#a_020) | 24 |
| Item 14. | [Principal Accountant Fees and Services.](#a_021) | 25 |
| [Part IV](#a_022) |  |  |
| Item 15. | [Exhibits](#a_023) | 26 |

---

i

**CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS**

The statements contained in this report with respect to our financial condition, results of operations and business that are not historical facts are "forward-looking statements". Forward-looking statements can be identified by the use of forward-looking terminology, such as "anticipate", "believe", "expect", "plan", "intend", "seek", "estimate", "project", "could", "may" or the negative thereof or other variations thereon, or by discussions of strategy that involve risks and uncertainties. Management wishes to caution the reader of the forward-looking statements that any such statements that are contained in this report reflect our current beliefs with respect to future events and involve known and unknown risks, uncertainties and other factors, including, but not limited to, economic, competitive, regulatory, technological, key employees, and general business factors affecting our operations, markets, growth, services, products and other factors, some of which are described in this report and some of which are discussed in our other filings with the Securities and Exchange Commission. These forward-looking statements are only estimates or predictions. No assurances can be given regarding the achievement of future results, as actual results may differ materially as a result of risks facing our company, and actual events may differ from the assumptions underlying the statements that have been made regarding anticipated events.

Important factors to consider in evaluating any forward-looking statements include:

● our ability to finance and complete the acquisition or real estate and agreements for the acquisition of the necessary power for our proposed data center operations;

● our ability to obtain all of the necessary regulatory approvals for our proposed data center operations and the energy needed to power such operations;

● our ability to implement our business plan;

● our ability to attract key personnel;

● our ability to operate profitably;

● our ability to efficiently and effectively finance our operations;

● inability to achieve future sales levels or other operating results;

● inability to raise additional financing for working capital;

● inability to efficiently manage our operations;

● the inability of management to effectively implement our strategies and business plans;

● the unavailability of funds for capital expenditures and/or general working capital;

● the fact that our accounting policies and methods are fundamental to how we report our financial condition and results of operations, and they may require management to make estimates about matters that are inherently uncertain;

● deterioration in general or regional economic conditions;

● changes in U.S. GAAP or in the legal, regulatory and legislative environments in the markets in which we operate;

● adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;

These risk factors should be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue. All written and oral forward looking statements made in connection with this report that are attributable to our company or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Given these uncertainties, we caution investors not to unduly rely on our forward-looking statements. We do not undertake any obligation to review or confirm analysts' expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, except as required by applicable law or regulation.

ii

Notwithstanding the above, 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"), expressly state that the safe harbor for forward-looking statements does not apply to companies that issue penny stock. If, as now, we are considered to be an issuer of penny stock, the safe harbor for forward-looking statements may not apply to us at certain times.

Throughout this report, unless otherwise designated, the terms "we," "us," "our," "the Company" and "our company" refer to CalEthos, Inc., a Nevada corporation, and its subsidiaries. All amounts are in U.S. Dollars, unless otherwise indicated.

**Item 1.** **Business.** 

We are a developer of large-scale infrastructure designed to power the digital economy. Our primary focus is the development of a "master-planned" data center campus in a business-friendly Northwestern U.S. location. Unlike traditional developments, our campus will be designed to be onsite-powered, meaning we intend to provide our tenants with dedicated, reliable energy generated on the property.

At its simplest, a data center is a specialized, highly-secure building that houses the "brains" of the internet. It contains the physical hardware—servers, storage systems, and networking equipment—that allows businesses to process, store and share digital information. Data centers may be thought of as high-tech warehouses where the "goods" being stored are data. To function, our data center campuses will require four critical elements that we plan to provide:

&nbsp;&nbsp;&nbsp;&nbsp;1. **Massive Power**: Constant electricity to keep the machines running.

2. **Connectivity**:
 High-speed fiber optic lines to move data across the globe.

3. **Permitting**:
 All permits and approvals necessary to build and operate a data center on our campus.

4. **Building Sites**: Construction-ready building sites with all utilities.

The industry generally classifies data centers into four categories based on who owns the equipment and how the space is used:

&nbsp;&nbsp;&nbsp;&nbsp;1. **Enterprise**:
 Built and used by a single company for its own needs.

2. **Managed Services**: A third party that handles the technology and infrastructure for a client.

3. **Colocation ("Colo")**: Multiple companies rent space, cooling, and power within a single
 facility while owning their own servers.

4. **Cloud**:
 Massive facilities where providers such as Amazon or Microsoft host data and applications
 for the public.

Our business model is focused on the infrastructure development stage of data center construction, where we provide "construction-ready" sites that are pre-permitted and approved, and fully-equipped with the power and utilities necessary for a data center company to build and operate its data center facilities. Our primary objectives include:

&nbsp;&nbsp;&nbsp;&nbsp;1. **Providing Onsite Energy**: We intend to offer a natural gas-powered energy platform that provides
 24/7 "baseload" power. This is designed to avoid delays in connecting to the
 grid and to give our tenants greater reliability and protection against power grid fluctuations
 and service interruptions.

2. **Creating Scalable Solutions**: We intend to provide flexible building lots that allow our customers
 to start small and expand their footprints as their data needs grow.

3. **Cultivating Strategic Partnerships**: We intend to sell or lease our construction-ready building sites
 on our campus to large-scale technology and cloud service providers. By offering a "ready-to-build"
 platform, we aim to foster long-term relationships with companies that require massive, resilient
 data solutions.

In a world where data is increasingly treated as a vital asset, we believe our approach of combining land development with onsite power generation addresses a critical gap in the current market.

**Plan of Operations**

In May 2025, we formed TerraVolt Infrastructure Inc. ("TerraVolt"), a wholly-owned subsidiary established to meet the demand for sustainable, baseload, powered land and infrastructure solutions for large-scale data center development. TerraVolt's proposed solution is a Physical Infrastructure-as-a-Service (PIaaS) platform that will integrate onsite behind-the-meter (BTM) power with construction-ready data center building sites that include utilities and fiber connectivity. TerraVolt plans to provide a turnkey solution with power and utilities to hyperscalers, colocation providers, and data center developers seeking to deploy new capacity faster than with traditional power and transmission from a local electric utility company. We are currently focused on a location where onsite power production using natural gas turbines and reciprocating engines is allowed under local and state building codes and where there is direct access to a natural gas pipeline with capacity for delivery within a reasonable timeframe.

Highlights of Our Planned Data Center Campus Development:

&nbsp;&nbsp;&nbsp;&nbsp;1.  ***High-Density Power Solution*** 

● **Natural Gas Pipeline Access**: ability to build a tap/meter station on the property to interconnect directly into a major northwestern U.S. gas pipeline.

● **Fuel Security**: FIRM Gas Supply Contract for 55k million British thermal units (MMBTU) /day, negotiated for an initial 300 Megawatt (MW) to 350MW of power, with additional capacity available in 2030.

● **Scalability**: Pipeline expansion planned for 2030, adding 50k–100k MMBTU per day (sufficient for an additional 300MW-600MW of power).

● **Self-Generation**: Onsite BTM gas-fired power plant allowed in Electric Co-Op service territory, which eliminates utility oversight, studies or interconnection queuing.

● **Speed to Market**: Onsite gas pipeline Tap/Meter station build is estimated to take 12 to18 months.

&nbsp;&nbsp;&nbsp;&nbsp;2.  ***Strategic Real Estate & Zoning*** 

● **Location**: Directly on major east/west interstate highway, providing a major transportation routes to several northwest U.S. cities.

● **Site Specs**: Flat, buildable AG land (Out of 100/500-year flood zones).

● **Zoning**: Conversion to Light Industrial is projected to take less than 12 months for approvals and permits.

● **Water Rights**: secured AG water rights to be preserved for data center cooling requirements.

&nbsp;&nbsp;&nbsp;&nbsp;3.  ***Connectivity & Fiber*** 

● **Latency**: Situated on a major fiber artery running through the northwestern U.S.

● **Local Access**: Local fiber at the property border with access to direct east and west fiber routes.

&nbsp;&nbsp;&nbsp;&nbsp;4.  ***Location Benefits*** 

● **Climate**: a cool, semi-arid climate enables free-air cooling for much of the year, reducing data center cooling energy needs by up to 80% compared to warmer regions like the Southwest or Southeast.

● **BTM Power**: in Electric Co-Op service territory, expedited tariff changes and approvals to operate, no system impact or interconnection required, no FERQ approvals or oversight.

● **Water**: Direct onsite well access and water rights to the major aquifer.

● **Tax Abatement**: Construction materials and data center equipment.

● **Transportation/Logistics**: Direct interstate access, artery to nearby urban areas, and regional airports.

● **Employees**: Low wages/housing, growing workforce. Recruitment from nearby universities.

● **Pro Business** – Full local and state government data center project and policy support, and expedited land use, environmental approvals, zone changes, and permitting.

● **Nuclear** – potential participation in the northwest U.S. nuclear corridor for future Small Modular Reactors (SMRs) upgrade for additional clean baseload power.

As of the date of this Report, we have commenced the initial phase of our planned onsite-powered data center campus development, which is focused on completing land-use applications, zone change requests, and supplemental site reports required by the local County Planning and Development Department. We anticipate securing land-use and conditional zone change approvals by year-end 2026.

Concurrently, we are finalizing timelines and budgets for all necessary county and state environmental assessments. These studies cover the data center campus, the onsite power plant, electrical distribution systems, and critical utility infrastructure (water, sewer, fiber, and gas). We expect to file these reports before the end of 2026, with the aim of securing all necessary construction approvals by the second quarter of 2027. Additionally, we expect to submit to applicable state agencies all design and environmental documentation for the onsite natural gas power plant by mid-2026.

**The Data Center Industry**

According to PricewaterhouseCoopers ("PwC"), the data center industry has entered a profound infrastructure investment supercycle, with total capital requirements projected to reach $3 trillion by 2030. Global data center capacity is expected to nearly double, growing from 103 GW to 200 GW between 2026 and 2030. This growth is fundamentally driven by the scaling of Artificial Intelligence ("AI"), which is anticipated to represent half of all workloads by 2030.

Market fundamentals remain exceptionally tight. According to CBRE Group, Inc. ("CBRE") and Jones Lang LaSalle ("JLL"), as of early 2026, global occupancy stands at 97%, with 77% of the current construction pipeline already pre-committed to tenants. The global market size was valued by PwC at approximately $386.71 billion in 2025 and is projected to exceed $1.1 trillion by 2035.

Power availability, rather than location or real estate cost, has become the primary criterion for site selection. The U.S. electrical grid has been unable to keep pace with demand, resulting in multi-year delays for new connections. According to CBRE and JLL:

● **Connection Delays**: In major hubs, the wait time for a grid connection now averages four or more years.

● **Expectation Gap**: There is a widening "power expectation gap" of 1.5 to 2 years between the utilities' projected delivery timelines and the immediate capacity needs of hyperscale providers.

● **Projected Consumption**: Data centers are expected to account for 8.9% to 12% of total U.S. electricity demand by 2030, up from approximately 4.4% in 2023.

To mitigate grid volatility and interconnection delays, the industry is increasingly adopting "Power-First" infrastructure strategies, moving toward independent, off-grid operation.

● **Onsite Evaluation**: Roughly 73% of hyperscalers and colocation providers are actively evaluating or selecting onsite power providers to ensure predictable "time-to-power".

● **Economic Advantage**: Onsite generation allows developers to pursue "power-advantaged" regions with an abundance of natural gas, such as Texas, which is projected to capture nearly 30% of total U.S. data center demand by 2028.

Natural gas has emerged as the essential "bridge" and primary fuel source for onsite data center power.

● **Dispatchability**: Natural gas remains the preferred choice for data centers because it provides reliable, 24/7 dispatchable power without the intermittency associated with renewable sources.

● **Hybrid Systems**: Next-generation designs often combine natural gas with Battery Energy Storage Systems (BESS) and solar, positioning the data center as a dynamic asset that can support the grid while maintaining its own critical load.

● **Grid Contribution**: Currently, natural gas accounts for approximately 40% of U.S. power generation, and its role as the leading fuel source for data center electricity is expected to persist through the end of the decade.

The data center industry continues have a significant economic impact throughout the U.S. and to be a significant catalyst for national growth.

● **GDP and Employment**: Between 2017 and 2021, data centers contributed $2.1 trillion to the U.S. GDP through direct and indirect effects.

● **Labor Income**: Direct employment in the sector grew by 17% from 2017 to 2021, significantly outperforming the broader U.S. employment growth of 2%.

● **Sustainability Evolution**: While traditional Renewable Energy Credits (RECs) are facing increased scrutiny, operators are shifting toward 24/7 Carbon-Free Energy (CFE) goals. This shift is driving interest in natural gas turbines that can eventually be converted to hydrogen and high-efficiency liquid cooling systems.

**Competition**

As a new entrant into the data center marketplace, we will compete against the larger, more established and better capitalized companies that today control the majority of market share. However, the data center industry is undergoing a paradigm shift driven by the "time-to-power" bottleneck. As a new entrant focused on high-performance computing (HPC) and hyperscale requirements, we compete in a landscape increasingly defined by energy independence and the speed of infrastructure deployment.

We compete with traditional data center REITs and developers, including Equinix, Digital Realty, CyrusOne, and Vantage Data Centers. However, our primary competitors now include a new wave of infrastructure developers focused on "behind-the-meter" (BTM) and "off-grid" power solutions to bypass utility interconnection delays, which can now exceed five to seven years in major hubs. Key competitors in this specialized space include:

● **Tract and Quantum Loophole**: Large-scale land and power "master developers" who prepare massive campuses for hyperscale tenants.

● **Cloverleaf Infrastructure**: Specifically focused on solving the power-grid interface for large-scale deployments.

● **Joint Ventures**: Large-scale energy-tech partnerships, such as the Chevron, Engine No. 1, and GE Vernova alliance, which aims to build "power foundries"—multi-gigawatt co-located natural gas power plants and data centers.

We believe our strategic pivot to onsite natural gas power generation addresses the immediate, critical need for baseload power for hyperscale customers. We believe our plan for onsite power offers us the following competitive advantages:

● **Reduced Time-to-Power**: By generating power on-site, we bypass the increasingly congested and slow utility interconnection queues that hamper our larger, grid-dependent competitors.

● **Baseload Reliability**: Unlike intermittent renewable sources (solar/wind), our natural gas-fired turbines and engine system will provide 24/7 "always-on" power required for the relentless duty cycles of AI and large-scale Large Language Models (LLM) training.

Many of our current and potential competitors may have significant advantages over us, including greater name recognition, longer operating histories, pre-existing relationships with current or potential customers, significantly greater financial, marketing and other resources, ownership of more data centers and data centers that are more broadly distributed geographically, access to less expensive power, and more robust interconnected hubs in certain geographic markets. All of these potential advantages could allow competitors to respond more quickly to new or changing opportunities. In addition, once we are operational, if our competitors offer space, power and/or interconnection services at rates below current market rates, or below the rates we are then charging our customers, we may lose potential customers or be pressured to reduce our rental rates below those we are then charging or have modelled in order to retain customers when our customers' leases expire.

As a developer of data center infrastructure, we also compete for the services of key third-party service providers, including engineers and contractors with expertise in the development of onsite power production and data centers. The competition for the services of specialized contractors and other third-party providers required for the development of onsite power production data centers is intense, increasing the cost of engaging such providers and the risk of delays in completing our development projects.

Finally, we face competition from real estate developers in our sector and in other industries for the acquisition of additional properties suitable for power production and data center developments. Such competition may reduce the number of properties available for acquisition or development, increase the price of these properties and reduce the demand for data center space in the markets we seek to serve.

**Risk Factors**

Emerging federal and state regulations aimed at protecting ratepayers could significantly increase our cost of doing business. In early 2026, several legislative proposals were introduced at both the federal and state levels to address the surge in demand for more AI data centers. We face emerging risks from:

● **Moratoriums and Siting Restrictions**: Concerns over grid reliability, noise, and water consumption have led some counties and states to deny building permits or to enact moratoriums on large-scale data center campuses.

● **Sustainability Regulations**: Stringent new sustainability standards and the devaluation of traditional carbon offsets may impact our ability to meet environmental targets. Sustainability regulations are evolving rapidly.

Our strategic reliance on "Bring Your Own Power" (BYOP) and onsite power generation entails nascent operational risks and greater capital intensity. While BYOP offers a faster "time-to-power," it introduces several critical risks:

● **Capital Intensity**: Average construction costs for onsite-powered facilities have risen significantly, contributing to a global infrastructure investment "supercycle" projected to reach $3 trillion by 2030.

● **Technology Risk**: Deploying large-scale microgrids utilizing natural gas turbines, fuel cells, and Battery Energy Storage Systems (BESS) involves complex engineering and integration risks that may lead to operational downtime or higher-than-expected maintenance costs.

● **Supply Chain Volatility**: The reliability of onsite power depends on a steady supply of natural gas. Any disruption to pipeline infrastructure or significant volatility in gas pricing could materially impact our operating margins.

In early 2026, the gas power generation equipment market is experiencing a robust upward cycle. It is driven by a global shift away from coal, the need to stabilize grids reliant on intermittent renewables, and a massive surge in electricity demand from AI and data centers. Because of this demand,

● **Natural Gas Generators** (Industrial Gensets) are experiencing delivery times of 18 to 30 months. While faster than utility-scale turbines, lead times for industrial-grade natural gas engines (like those from Caterpillar) have roughly doubled since 2021. Companies are increasingly deploying "mobile gas turbines" as stopgap measures to get data centers online while awaiting permanent equipment.

● **Support Infrastructure** (Transformers & Switchgear), like generation equipment, due to market demand, and other components, such as electrical generation and distribution systems, are also experiencing lead times of 2+ years.

**Employees**

We currently have three full-time employees, two of whom are our executive officers. None of our employees is represented by a collective bargaining agreement, and we have never experienced any work stoppage. We believe we have good relations with our employees.

**Corporate History and Recent Developments**

We were incorporated pursuant to the laws of the State of Nevada on March 20, 2002 under the name Integrated Brand Solutions Inc., and on February 6, 2006, we changed our name to Upstream Biosciences Inc. From 2006 to December 2009, our company operated as a biotechnology company, and from 2010 until May 2013, our company had no operating business. On July 11, 2013, we changed our corporate name to RealSource Residential, Inc. Our initial business strategy in 2013 was to engage in various real estate related businesses. However, in 2016 we disposed of all of our real estate and other assets and on December 20, 2018, we changed our corporate name from RealSource Residential, Inc. to CalEthos, Inc.

In early 2021, we determined there was a sizable opportunity to develop and manufacture high-performance computer systems for the cryptocurrency mining industry. During the development of our computer chip and system in Korea, we had also developed a plan to build a large-scale, clean-energy powered, containerized, immersion-cooled data center operation in Southern California to support the use of the systems we were developing for our company and for others. However, following the decline of the bitcoin market in early 2022, we decided to abandon our chip and system development efforts and we determined that we could develop a profitable business by offering wholesale data center colocation services to a larger customer base of hyperscale and enterprise IT companies, initially in Imperial County, California. After optioning parcels of land in Imperial County and working with the Imperial County planning department and other local regulatory agencies in seeking zoning changes and other required regulatory approvals required for the Company's proposed data center campus, it became evident by May 2025 that the Company's timelines for the receipt of such approvals would not be met.

In May 2025, we formed TerraVolt to meet the demand for sustainable, baseload, powered land and infrastructure solutions for large-scale data centers development and end users. We are currently focusing on acquiring properties in states in which onsite power production utilizing natural gas fuel cells and turbines are allowed and in which we can acquire access to natural gas pipeline and capacity for delivery within a reasonable timeframe.

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| | |
|:---|:---|
| **Item 1A.** | **Risk Factors.** |

---

We are a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

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| | |
|:---|:---|
| **Item 1B.** | **Unresolved Staff Comments.** |

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None.

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| | |
|:---|:---|
| **ITEM 1C.** | **Cybersecurity** |

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**Risk Management and Strategy**

While we are in our early stages of our business plan, we regularly assess risks from cybersecurity threats, monitor our information systems for potential vulnerabilities and test those systems pursuant to our cybersecurity processes and practices, which are integrated into our overall risk management system. As we progress with the development of our business plans, we plan to use various security tools designed to help us identify, investigate, resolve and recover from security incidents in a timely manner.

To date, cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected and we believe are not reasonably likely to affect our company, including our business strategy, results of operations or financial condition.

**Governance**

One of the key functions of our board of directors is informed oversight of our risk management process, including risks from cybersecurity threats. Our board of directors is responsible for monitoring and assessing strategic risk exposure, and our executive officers are responsible for the day-to-day management of the material risks we face.

We take a risk-based approach to cybersecurity and have implemented cybersecurity policies throughout our operations that are designed to address cybersecurity threats and incidents.

Our Chief Executive Officer is primarily responsible for assessing and managing our material risks from cybersecurity threats with assistance from third-party service providers and outside counsel, as needed.

Our Chief Executive Officer oversees our cybersecurity policies and processes, including those described in "Risk Management and Strategy" above. Our cybersecurity risk management program includes tools and activities to prevent, detect and analyze current and emerging cybersecurity threats, and plans and strategies to address threats and incidents.

**Item 2.** **Properties.**

We do not own any real property. Our executive office is located at 11753 Willard Avenue, Tustin, California 92782, in the office of Michael Campbell, our Senior Vice President, Corporate Development. We are not charged rent for the use of this space. We believe our existing facilities are sufficient for our current operations.

**Item 3.** **Legal Proceedings.**

We know of no material active or pending legal proceeding against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation.

**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.**

Our common stock is listed for quotation on the OTCQB Market under the trading symbol "GEDC." Trading in our common stock in the over-the-counter market has been limited and the quotations set forth below are not necessarily indicative of actual market values. The following table sets forth, for the periods indicated, the high and low closing bid prices for each quarter within the last two fiscal years ended December 31, 2025 as reported by the quotation service operated by the OTC Markets Group. All quotations for the OTCQB Market reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

---

| | | |
|:---|:---|:---|
| **Quarter Ended** | **High** | **Low** |
| December 31, 2025 | $0.60 | $0.30 |
| September 30, 2025 | 0.85 | 0.26 |
| June 30, 2025 | 0.87 | 0.35 |
| March 31, 2025 | 2.00 | 0.82 |
| December 31, 2024 | 6.00 | 1.40 |
| September 30, 2024 | 6.00 | 3.50 |
| June 30, 2024 | 3.50 | 2.62 |
| March 31, 2024 | 13.50 | 0.75 |

---

On March 16, 2026, the closing bid price for our common stock on the OTCQB Market as reported by the quotation service operated by the OTC Markets Group was $0.14.

**Transfer Agent**

Nevada Agency and Transfer Company is the registrar and transfer agent for our common stock. Its address is 50 West Liberty, Suite 880 Reno, Nevada, 89501 Telephone: 775-322-0626, Facsimile: 775-322-5623.

**Holders of Our Common Stock**

As of March 16, 2026, there were 60 registered holders of record of our common stock. As of such date, 25,730,540 shares of common stock were issued and outstanding. The number of our shareholders of record excludes any estimate by us of the number of beneficial owners of shares held in street name, the accuracy of which cannot be guaranteed.

**Dividend Policy**

We have not declared or paid any cash dividends since inception. Although there are no restrictions that limit our ability to pay dividends on our common shares, we do not intend to pay dividends for the foreseeable future.

**Item 6. Selected Financial Data.**

We are a "smaller reporting company" as defined by Regulation S-K and as such, are not required to provide the information contained in this item pursuant to Regulation S-K.

**Item 7.** **Management's Discussion and Analysis of Financial Condition and Results of Operation.**

*The following discussion should be read in conjunction with our audited financial statements and the related notes that appear elsewhere in this Report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include those discussed below and elsewhere in this Report.*

*Our audited financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.*

We are a developer of large-scale infrastructure designed to power the digital economy. Our primary focus is the development of a "master-planned" data center campus in a business-friendly Northwestern U.S. location. Unlike traditional developments, our campus will be designed to be onsite-powered, meaning we intend to provide our tenants with dedicated, reliable energy generated on the property.

In May 2025, we formed TerraVolt Infrastructure Inc. ("TerraVolt"), a wholly-owned subsidiary established to meet the demand for sustainable, baseload, powered land and infrastructure solutions for large-scale data center development. TerraVolt's proposed solution is a Physical Infrastructure-as-a-Service (PIaaS) platform that will integrate onsite behind-the-meter (BTM) power with construction-ready data center building sites that include utilities and fiber connectivity. TerraVolt plans to provide a turnkey solution with power and utilities to hyperscalers, colocation providers, and data center developers seeking to deploy new capacity faster than with traditional power and transmission from a local electric utility company. We are currently focused on a location where onsite power production using natural gas turbines and reciprocating engines is allowed under local and state building codes and where there is direct access to a natural gas pipeline with capacity for delivery within a reasonable timeframe.

As of the date of this Report, we have commenced the initial phase of our planned onsite-powered data center campus development, which is focused on completing land-use applications, zone change requests, and supplemental site reports required by the local County Planning and Development Department. We anticipate securing land-use and conditional zone change approvals by year-end 2026.

Concurrently, we are finalizing timelines and budgets for all necessary county and state environmental assessments. These studies cover the data center campus, the onsite power plant, electrical distribution systems, and critical utility infrastructure (water, sewer, fiber, and gas). We expect to file these reports before the end of 2026, with the aim of securing all necessary construction approvals by the second quarter of 2027. Additionally, we expect to submit to applicable state agencies all design and environmental documentation for the onsite natural gas power plant by mid-2026.

It is anticipated that we will incur significant expenses in the implementation of our business plan as described herein, and that we will require substantial financing to complete the development and construction of the planned data center campus. A failure to obtain this necessary capital when required on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development plans, any commercialization efforts and any other operations. We may not be able to secure financing on favorable terms, or at all, to meet our future capital needs. In addition, even if we are able to obtain sufficient funding to commence our business operations, we may need to pursue additional financing in the future to make expenditures and/or investments to support the growth of our business. In addition, we may require additional capital to pursue our business objectives and respond to new competitive pressures, pay extraordinary expenses or fund our growth, including through acquisitions. Additional funding, however, may not be available when required on terms that are acceptable to us, or at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when it is required, our ability to commence and grow our proposed business operations, to support our business and to respond to business challenges could be significantly limited.

We currently have only limited capital with which to pay these anticipated expenses. To fund our business plan going forward, we intend to raise funds from investors by issuing common stock, preferred stock and/or debt securities.

**Results of Operations for the years ended December 31, 2025 and 2024**

The following table summarizes our results of operations for the years ended December 31, 2025.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | | Change | Change |
|  | 2025 | 2024 | Dollar | Percentage |
| Revenues | $- | $- | $- | -% |
| Operating Expenses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Professional fees | 340000 | 386000 | (46000) | (11.9) |
| &nbsp;&nbsp;&nbsp;Equity-based compensation | 80000 | 369000 | (289000) | (78.3) |
| &nbsp;&nbsp;&nbsp;General and administrative | 52000 | 49000 | 3000 | 6.1 |
| &nbsp;&nbsp;&nbsp;Payroll and related cost | 583000 | 259000 | 324000 | 125.1 |
| Total operating expenses (income) | $1055000 | $1063000 | $(8000) | (0.8)% |
| Other (expenses) income |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | $5000 | $12000 | $7000 | 58.3% |
| &nbsp;&nbsp;&nbsp;Financing costs | (186000) | (12000) | 174000 | 1450.0 |
| &nbsp;&nbsp;&nbsp;Financing costs - related party | (676000) | (2398000) | (1722000) | 71.8 |
| &nbsp;&nbsp;&nbsp;Abandoned development project cost | (4594000) | (344000) | 4250000 | (1235.5) |
| &nbsp;&nbsp;&nbsp;Loss on extinguishment of notes payable – related party |  | (2317000) | (2317000) | (100.0) |
| &nbsp;&nbsp;&nbsp;Loss on extinguishment of convertible promissory notes |  | (6468000) | (6468000) | (100.0) |
| &nbsp;&nbsp;&nbsp;Gain from closure of foreign subsidiary | 8000 | - | (8000) | (100.0) |
| Total other expense | $(5443000) | $(11527000) | $(6084000) | (52.8)% |

---

*Revenues*

 

For the years ended December 31, 2025 and 2024, we had no revenues.

*Operating Expenses*

 

Professional fees

Our professional fees decreased to $340,000 for the year ended December 31, 2025 from $386,000 for the year ended December 31, 2024. The decrease of approximately $46,000 was attributable to increases in (i) audit fees of $17,000 and geological services of $37,000, offset by decreases in (ii) consulting services $34,000, legal services $61,000 and other professional expenses of $5,000.

<u>Equi</u>ty<u>-based compensation</u>

Our equity-based compensation for the year ended December 31, 2025 decreased to $80,000 from $369,000 for the year ended December 31, 2024. During the year ended December 31, 2025, we recorded a recapture of approximately $236,000 of equity-based compensation related to the non-performance of outstanding performance-based awards. The time-based equity-based compensation for the year ended December 31, 2025 was $316,000, for a net expense of $80,000.

Payroll and related expenses

Payroll and related expenses increased to $583,000 for the year ended December 31, 2025 from $259,000 for the year ended December 31, 2024. The increase of $324,000 related to our abandonment of our data center campus project in Imperial County, California in July 2025. As a result of the abandonment, we did not capitalize payroll and related expenses during the second, third and fourth quarters of 2025, we did not capitalize payroll and related expenses.

Financing costs

Our financing cost for the year ended December 31, 2025 increased to $186,000 compared to $12,000 for the year ended December 31, 2024. Our convertible debentures were outstanding for the twelve months of the year ended December 31, 2025 compared to four months of the year ended December 31, 2024.

Financing costs – related party

Our financing cost – related party for the year ended December 31, 2025 decreased to $676,000 from $2,398,000 for the year ended December 31, 2024. The decrease of $1,722,000 was due to a decrease in interest and loan discount expense for notes payable to the related party.

<u>Loss on extinguishment of notes payable - related par</u>ty

During the year ended December 31, 2025, we did not have an extinguishment for our notes payable to related party.

Loss on extinguishment of convertible promissory notes

During the year ended December 31, 2025, we did not have a loss on extinguished of convertible promissory notes.

Gain from closure of foreign subsidiary

During the year ended December 31, 2025, we finalized the closure of our Korean subsidiary.

Abandonment of development project cost

We elected not to renew our purchase option on the existing property in Imperial County, California when it expired in July 2025. Consequently, previously capitalized data center development costs were expensed, and we will cease capitalizing additional data center development expenses until we can secure parcels with appropriate zoning for data center use and greater certainty around the execution of our development plans. At the termination of the data center development, we had approximately $4,581,000 of capitalized development cost, which has been recorded as abandoned project costs.

**Liquidity and Capital Resources**

Our working capital deficit as of December 31, 2025 and 2024 was as follows.

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| Current assets | $295000 | $296000 |
| Current liabilities | (3095000) | (515000) |
| Working capital deficit | $(2800000) | $(219000) |

---

Our working capital deficit increased from a $219,000 deficit as of December 31, 2024 to a deficit of $2,800,000 as of December 31, 2025 for an increase of $2,582,000. The increase in our working capital deficit was due to increases in (i) $1,581,000 of convertible debentures, (ii) $728,000 of notes payable related parties and (iii) $271,000 of accounts payable.

*Cash Flows, for the years ended December 31,* 

 

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| Net cash used in operating activities | $(750000) | $(859000) |
| Net cash used in investing activities | (464000) | (1467000) |
| Net cash provided by financing activity | 1215000 | 2305000 |
| Effect of exchange rate changes | - | (1000) |
| Change in cash and cash equivalents during the period | 1000 | (22000) |
| Cash and cash equivalents, beginning of period | 286000 | 308000 |
| Cash and cash equivalents, end of period | $287000 | $286000 |

---

Cash Flows from Operations

Cash used in operating activities decreased to approximately $750,000 for the year ended December 31, 2025 from approximately $859,000 for the year ended December 31, 2024, which was predominantly related to the increase in our payroll and related expenses that was offset in part by a decrease in professional fees.

Cash Flows from Investing

Our cash used in investing activities decreased to approximately $464,000 for the year ended December 31, 2025 from approximately $1,467,000 for the year ended December 31, 2024. The primary use of cash was for expenditures for the development of our data center campus, which was suspended during the quarter ended June 30, 2025.

Cash Flows from Financing

Our cash provided by financing activities decreased to $1,215,000 for the year ended December 31, 2025 from approximately $2,305,000 for the year ended December 31, 2024. The cash provided of $1,215,000 was funded by one of our shareholders, who is also a member of our board.

**Liquidity and Material Cash Requirements**

Even though we experienced negative cash flows from operations of approximately $750,000 for the year ended December 31, 2025, as a result of the funding from one of our shareholders, we had cash and cash equivalents of approximately $287,000 at December 31, 2025. As of December 31, 2025, we had approximately $1,635,000 of convertible debentures with maturity dates of December 31, 2026 and $1,000,000 of notes payable related party with maturity dates of June 30, 2026.

It is anticipated that we will incur expenses in the implementation of our business plan described above, and such expenses will require substantial financing to complete the development of the property for a data center operation and to achieve our goals. We currently have only limited capital with which to pay these anticipated expenses. To repay our short-term indebtedness and to fund our business plan going forward, we intend to raise funds from investors by issuing common stock, preferred stock and/or debt securities. We are currently in discussions with several potential funding sources. However, there can be no assurance we will be able to successfully raise additional funds when required, if at all.

The failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development plans, any commercialization efforts or other operations. We may not be able to secure financing on favorable terms, or at all, to meet our future capital needs. In addition, even if we are able to obtain sufficient funding to commence our business operations, we may need to pursue additional financing in the future to make expenditures and/or investments to support the growth of our business and may require additional capital to pursue our business objectives and respond to new competitive pressures, pay extraordinary expenses or fund our growth, including through acquisitions. Additional funds, however, may not be available when we need them on terms that are acceptable to us, or at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to commence our proposed business operations, to continue to grow and support our business and to respond to business challenges could be significantly limited.

---

| | |
|:---|:---|
| **Item 7A.** | **Quantitative and Qualitative Disclosures About Market Risk.** |

---

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide this information.

**Item 8.** **Financial Statements and Supplementary Data.**

Our financial statements and notes thereto and the reports of RBSM LLP, our independent registered public accounting firm, are set forth on pages F-1 through F-21 of this Report.

**Item 9.** **Changes In and Disagreements with Accountants on Accounting and Financial Disclosure.**

Not Applicable

---

| | |
|:---|:---|
| **Item 9A.** | **Controls and Procedures.** |

---

*Disclosure Controls and Procedures*

As required by paragraph (b) of Rules 13a-15 or 15d-15 under the Exchange Act, our principal executive officer and principal financial officer evaluated our company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of December 31, 2025, the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, these officers concluded that as of the end of the period covered by this Annual Report on Form 10-K, these disclosure controls and procedures were not effective.

The conclusion that our disclosure controls and procedures were not effective was due to the presence of material weaknesses in internal control over financial reporting as identified below under the heading "Management's Report on Internal Control Over Financial Reporting." Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdown can occur because of simple error or mistake.

*Management's Report on Internal Control Over Financial Reporting*

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) for our company. Our internal control over financial reporting is designed to provide reasonable assurance, not absolute assurance, regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America. Internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in the United States of America, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

Our management, including our principal executive officer and principal financial officer, conducted an evaluation of the design and operation of our internal control over financial reporting as of December 31, 2025 based on the criteria set forth in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, our management concluded our internal control over financial reporting was not effective as at December 31, 2025 due to the following material weaknesses which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines; (iii) inadequate security and restricted access to computer systems including insufficient disaster recovery plans; and

(iv) no written whistle-blower policy.

We plan to take steps to enhance and improve the design of our internal controls over financial reporting when our company has sufficient staff to allocate responsibilities. During the period covered by this Report, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes once our financial resources will support the required staffing level: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; (ii) adopt sufficient written policies and procedures for accounting and financial reporting and a whistle-blower policy; and (iii) implement sufficient security and restricted access measures regarding our computer systems and implement a disaster recovery plan. The remediation efforts set out in (i) and (iii) are largely dependent upon our company securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely effected in a material manner.

This Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Our internal control over financial reporting was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management's report in this Report.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

*Changes In Internal Control Over Financial Reporting.*

There were no changes in our internal control over financial reporting 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.** |

---

None.

**PART III**

**Item 10.** **Directors, Executive Officers and Corporate Governance.**

*Directors and Executive Officers*

Our directors and executive officers, their ages and their positions held with our company are as follows:

---

| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position(s) Held with the Company** |
| Joel D. Stone | 56 | Chairman of the Board and Chief Executive Officer |
| Michael Campbell | 70 | Senior Vice President, Corporate Development and Director |
| Dean S. Skupen | 65 | Chief Financial Officer |
| Steven Shum | 56 | Director |
| Sean Fontenot | 46 | Director |

---

There are no arrangements between our directors and any other person pursuant to which our directors were nominated or elected for their positions. There are no family relationships among our directors or officers.

The following biographical information regarding our directors and executive officers.

***Joel D. Stone.*** *Mr*. Stone became our Chairman of the Board and Chief Executive Officer on March 27, 2026. Previously, he had been our President and Chief Operating Officer since March 28, 2023. Mr. Stone has 25 years of broad-based operations, engineering, construction, integration, transformation, and technical leadership in the data center infrastructure, sourcing, and telecommunications industries. Prior to joining our company, Mr. Stone led the Global Site Sourcing teams for Meta Platforms that supported the data center infrastructure teams from 2019 to 2022. Prior to 2019, Mr. Stone served as Senior Vice President and Chief Operating Officer of RagingWire Data Centers, an NTT communications company, where he was responsible for critical facilities engineering, design, construction, and data center operations from 2016-2018. Prior to RagingWire, Mr. Stone served as Vice President of Global Data Center Operations for CenturyLink Communications, responsible for 58 data centers around the world and a global team of 600+ people from 2011to 2016. Prior to CenturyLink, Mr. Stone was Group Operations Director at Global Switch in London, one of the largest wholesale data center providers in Europe and Asia. Mr. Stone spent nine years at Microsoft where he was responsible for all North America data center operations. Earlier in his career, Mr. Stone built-out two state-of-the-art data centers in Silicon Valley (Santa Clara) for Cable & Wireless Communications.

***Michael Campbell***. Mr. Campbell became our Senior Vice President, Corporate Development on March 27, 2026. Previously, he had been our Chief Executive Officer since September 12, 2018, a position from which he resigned on March 27, 2026 because of health issues. For the past 20 years, Mr. Campbell has been the managing director of M1 Advisors LLC, a business advisory and consulting firm that has engineered, orchestrated and provided support and services to numerous private-to-public transitions, debt and equity financings and hyper- organic-growth and consolidation strategies in a wide range of industries. In addition, from December 2011 to February 2017, Mr. Campbell was the Chief Executive Officer and a director of NXChain, Inc., a publicly-traded start-up shell company in the cryptocurrency business that was a successor to AgriVest Americas Inc., a publicly-traded start-up shell company that sought to acquire cattle ranches in Brazil for conversion to soybean farms. Mr. Campbell spent the first 20 years of his career in the high-tech industry creating and operating various companies that included a computer retailing operation, data-storage peripheral company with three computer disk-drive manufacturing companies through joint ventures with the Russian, Chinese and Spanish governments, a specialized call-center company for telco broadband provisioning and an online broadband services ordering and order aggregation company with the Regional Bell Operating Companies.

***Dean S. Skupen***. Mr. Skupen became our Chief Financial Officer on September 12, 2018. Mr. Skupen is a business advisor who has provided various financial accounting services to, or acted as the Interim Chief Financial Officer for, a number of public companies since 2010. Prior to that, he was a Partner at Stonefield Josephson, Inc. (now Marcum, LLP), an accounting firm with five offices throughout California where he provided auditing and consulting services to public companies and to privately-held entrepreneurial companies transitioning to public ownership in diverse industries. Mr. Skupen graduated from the University of Southern California with a Bachelor of Science degree in Accounting. In addition, he is licensed as a Certified Public Accountant in the State of California.

***Steven M. Shum.*** Mr. Shum became a director of our company on October 7, 2021. Mr. Shum has been Chief Executive Officer of INVO Bioscience (NASDAQ: INVO) since October 2019 and a member of the board of directors of INVO Bioscience since October 2017. Prior to INVO Bioscience, Mr. Shum served as Chief Financial Officer of Eastside Distilling (NASDAQ: EAST) from October 2015 to November 2019. Prior to joining Eastside, from October 2008 until April 2015, Mr. Shum was an employee and a member of the board of directors of XZERES Corp. (OTCQB:XPWR), a global renewable energy company, where he served in various officer roles, including Chief Operating Officer from September 2014 until April 2015, Chief Financial Officer, Principal Accounting Officer and Secretary from April 2010 until September 2014 (under former name, Cascade Wind Corp) and Chief Executive Officer and President from October 2008 to August 2010. Mr. Shum also serves as the managing principal of Core Fund Management, LP and the Fund Manager of Core Fund, LP. He was a founder of Revere Data LLC (now part of Factset Research Systems, Inc.) and served as its Executive Vice President for four years, heading up the product development efforts and contributing to operations, business development, and sales. He spent six years as an investment research analyst and portfolio manager of D.N.B. Capital Management, Inc. His previous employers include Red Chip Review and Laughlin Group of Companies. He earned a B.S. in Finance and a B.S. in General Management from Portland State University in 1992.

***Sean Fontenot.*** Mr. Fontenot became a director of our company on October 7, 2021. Mr. Fontenot is formally trained as a network engineer and has a multidisciplinary background spanning biotechnology, digital infrastructure, and nonprofit governance. He currently serves on the board or directors of several biotechnology companies and a nonprofit organization bringing a balanced perspective across regulated science-driven businesses, capital-intensive technology platforms, and mission-oriented organizations.

**Involvement in Certain Legal Proceedings**

None of our directors and executive officers have been involved in any of the following events during the past ten years:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. any
 bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the
 time of the bankruptcy or within two years prior to that time;

2. any
 conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor
 offences);

3. being
 subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction,
 permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities
 or banking activities;

4. being
 found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Futures Trading
 Commission to have violated a federal or state securities or commodities law, where the judgment has not been reversed, suspended,
 or vacated;

5. being
 the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently
 reversed, suspended or vacated, relating to an alleged violation of (i) any federal or state securities or commodities law or regulation;
 (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or
 permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease- and-desist order,
 or removal or prohibition order; or (iii) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business
 entity; or being the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory
 organization (as defined in Section 3(a)(26) of the Securities Exchange Act of 1934), any registered entity (as defined in Section
 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority
 over its members or persons associated with a member.

**Director Independence**

Our board of directors has reviewed the composition of our board of directors and the independence of each director. Based upon information requested from and provided by each director concerning his background, employment and affiliations, including family relationships, our board of directors has determined that each of Steven Shum and Sean Fontenot is an "independent director" as defined under Rule 5605(a)(2) of the Nasdaq Marketplace Rules. In making such determinations, our board of directors considered the relationships that each such non-employee director has with our company and all other facts and circumstances our board of directors deemed relevant in determining independence, including the beneficial ownership of our capital stock by each non-employee director.

**Board Committees**

We do not have a standing Audit Committee. We do not believe that the lack of an Audit Committee has had or will have any adverse effect on our financial statements, based upon current operations; however, our board of directors will consider establishing an Audit Committee of independent directors as the number of directors increases. Until such time, our board of directors will perform the duties of an Audit Committee, including engaging an auditor firm and interacting with them.

We do not have a standing Compensation Committee. Presently, the salary and benefits of our executive officers are determined by our entire board of directors. As we continue to develop our business, we expect to increase the size of our board to include independent directors who will approve the compensation arrangements with our executive officers.

We also do not have a Nominating Committee as we have not adopted any procedures by which security holders may recommend nominees to our board of directors.

**Code of Ethics**

Effective March 28, 2022, our Board of Directors adopted an amended Code of Business Conduct and Ethics that applies to, among other persons, members of our board of directors, our company's officers, contractors, consultants and advisors. We will provide a copy of the Code of Business Conduct and Ethics to any person without charge, upon request. Requests can be sent to our company at the address on the cover of this Annual Report.

**Delinquent Section 16(a) Reports**

Section 16(a) of the Exchange Act requires our executive officers, directors 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, all required Section 16 reports under the Exchange Act for our directors, executive officers 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 for the filing of a Report of Beneficial Ownership on Form 4 and an amendment to a previously-filed Report on Schedule 13D, which were filed one day late by Chauncey Lennis Thompson, the beneficial owner of more than 10% of our common stock.

**Item 11.** **Executive Compensation.**

The following table sets forth all compensation awarded to, earned by or paid to the executive officers of our company during the years ended December 31, 2025 and 2024. No compensation was paid to any other executive officer of our company during such periods.

**SUMMARY COMPENSATION TABLE**

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Name and Principal Position | Fiscal Year | Salary ($) | Bonus ($) | Stock Awards ($) | Option/Warrant Awards<sup>(5)</sup> ($) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation Earnings <br> ($) | All Other Compensation ($) | Total ($) |
| Michael Campbell | 2025 | 271413 | – |  |  | – |  |  | 271413 |
| Chief Executive Officer<sup>(1)</sup> | 2024 | 239999 | – |  | 323050 | – |  | 92006<sup>(2)</sup> | 655055 |
| Joel D. Stone | 2025 | 181241 | – |  |  | – |  |  | 181241 |
| President and Chief Operating Officer<sup>(3)</sup> | 2024 | 225000 | – |  | 786092 | – |  |  | 1011092 |
| Dean S. Skupen | 2025 |  | – |  |  | – |  | 60000<sup>(4)</sup> | 60000 |
| Chief Financial Officer | 2024 |  | – |  |  | – |  | 60000<sup>(4)</sup> | 60000 |

---

(1) Mr.
 Campbell resigned his office as our Chief Executive Officer and became our Senior Vice President, Corporate Development in March
 2026.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Represented
 amounts earned by Mr. Campbell as a consultant to our company. Mr. Campbell became an employee of our company in March 2024.

(3) Mr.
 Stone became our Chief Executive Officer in March 2026. Previously, he had been our President and Chief Operating Officer.

(4) Represents
 amounts earned by Mr. Skupen under his consulting agreement.

(5) Reflects
 the aggregate fair value computed in accordance with the provisions of the Financial Accounting Standard Board Accounting Standards
 Codification Topic 718, or ASC 718. See Note 2 to our consolidated financial statements for the year ended December 31, 2025 included
 in this report regarding assumptions underlying the valuation of equity awards. These amounts reflect the accounting cost for these
 stock options and do not reflect the actual economic value that may be realized by the named executive officer upon the vesting of
 the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.

**Employment Agreement**

On March 27, 2026, we entered into an Employment Agreement dated as of March 27, 2026 (the "Employment Agreement") with Joel D. Stone, to serve as our Chairman and Chief Executive Officer. Prior to entering in the Employment Agreement, Mr. Stone had been our President and Chief Operating Officer. Pursuant to the terms of the Employment Agreement, Mr. Stone will receive (i) an annual base salary of $300,000, which amount may be increased upon our reaching certain benchmarks described in the Employment Agreement, as determined in our sole discretion; (ii) an additional option grant of seven-year fully-vested options to purchase 2,000,000 shares of our common stock for a purchase price of $0.49 per share, and (iii) the right to participate in all benefit plans offered to our senior executive officers.

The Employment Agreement also provides for certain severance benefits upon a termination by us without "cause" or by Mr. Stone for "good reason." In the event of a termination by us without "cause" or by Mr. Stone for "good reason", Mr. Stone will be entitled to (i) continued payment of his base salary for the lesser of six (6) months or the remaining term of the Employment Agreement, subject to Mr. Stone signing a timely and effective separation agreement containing a release of all claims against us and other customary terms; provided, however, that if such termination is between the 91<sup>st</sup> day and the end of the first year of employment, Mr. Stone will be entitled to a pro rata portion of such payment.

The Employment Agreement contains customary confidentiality restrictions and work-product provisions with respect to Mr. Stone, as well as customary non-competition covenants and non-solicitation covenants with respect to our employees, consultants and customers.

**Consulting Agreements**

On October 20, 2018, we entered into a consulting agreement with DSS Consulting Corporation, a corporation controlled by Dean Skupen, our Chief Financial Officer ("DSS Consulting"), pursuant to which DSS Consulting agreed to continue to provide consulting services to our company and to cause Mr. Skupen to serve as our Chief Financial Officer. The agreement with DSS Consulting will continue until terminated by either party. Pursuant to such agreement, DSS Consulting was issued 250,000 shares of common stock in March 2019 and DSS Consulting will be paid a monthly consulting fee in the amount of $5,000. The consulting agreement contains customary confidentiality restrictions and work-product provisions, as well as customary non-competition covenants and non-solicitation covenants with respect to our employees, consultants and customers.

**Equity Compensation Plan Information**

The following table provides information as of December 31, 2025, regarding our compensation plans under which equity securities are authorized for issuance:

---

| | | | |
|:---|:---|:---|:---|
| **Plan category** | **Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights** | **Weighted- Average Exercise Price of Outstanding Options, Warrants and Rights** | **Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected**<br> **in Column (a))**  |
|  | (a) | (b) | (c) |
| 2021 Equity compensation plan approved by security holders | 6716500 | $0.65 | 3283500 |
| Equity compensation plans not approved by security holders |  |  |  |
| **Total** | 6716500 | $0.65 | 3283500 |

---

**2021 Equity Incentive Plan**

On October 4, 2021, we adopted our 2021 Equity Incentive Plan (the "Equity Plan") to provide an additional means to attract, motivate, retain and reward selected employees and other eligible persons. Our stockholders also approved the Equity Plan on October 4, 2021. On November 28 2023, our board of directors approved an increase in the number shares of common stock reserved for issuance under the Equity Plan to 10,000,000 shares, subject to stockholder approval, which has not yet been obtained. We intend to obtain the required stockholder approval by written consent in the second quarter of 2026. Employees, officers, directors and consultants who provide services to us or one of our subsidiaries were eligible to receive awards under the Equity Plan. Awards under the Equity Plan are issuable in the form of incentive or nonqualified stock options, stock appreciation rights, stock bonuses, restricted stock, stock units and other forms of awards including cash awards.

As of December 31, 2025, options to purchase an aggregate of 8,204,000 shares of common stock had been granted under the Equity Plan, and 1,796,000 shares authorized under the Equity Plan remained available for award purposes.

***Purpose*.** The purpose of the Equity Plan is to further and promote the interests of our company and its stockholders by enabling us to attract, retain and motivate employees, directors and consultants, or those who will become employees, directors or consultants, and to align the interests of those individuals with the interests of our stockholders.

***Administration*.** The Equity Plan will be administered by an independent compensation committee appointed by the Board (the "Compensation Committee"), which will have general administrative authority for the Equity Plan. In the event that the Board has not appointed the Compensation Committee, then the Board shall have all the powers of the Compensation Committee under the Equity Plan. The Compensation Committee may delegate certain limited authority to one or more of our senior executive officers to grant awards to employees who are not subject to Section 16 of the Exchange Act. Additionally, the Compensation Committee may designate persons other than members of the Compensation Committee to carry out the day-to-day ministerial administration of the Equity Plan (other than with regard to the selection for participation in the Equity Plan and/or the granting of any awards to participants) under such conditions and limitations as prescribed by the Compensation Committee (the appropriate acting body, be it the Compensation Committee, the Board, or an executive officer within his or her delegated authority, is referred to herein as the "Administrator"). The Administrator's determinations under the Equity Plan need not be uniform and may be made selectively among the Equity Plan's participants, whether or not such participants are similarly situated.

The Administrator has broad authority under the Equity Plan with respect to award grants including, without limitation, the authority to:

● select the Equity Plan's participants;

● make awards in such amounts and form as the Administrator shall determine;

● impose such restrictions, terms and conditions upon such awards as the Administrator shall deem appropriate; and

● correct any technical defect(s) or technical omission(s), or reconciling any technical inconsistency(ies), in the Equity Plan and/or any award agreement.

***Eligibility.*** Persons eligible to receive awards under the Equity Plan include employees, directors and consultants, or those who will become employees, directors or consultants, of our company and/or its subsidiaries. Notwithstanding the above, incentive stock options may only be granted under the Equity Plan to our employees.

***Authorized Shares*.** The maximum number of shares of common stock that may be initially issued or transferred pursuant to awards under the Equity Plan shall not exceed 10,000,000 shares, all of which may be issued as any type of award permitted under the Equity Plan, including, but not limited to, incentive stock options.

***Types of Awards*.** The Equity Plan authorizes awards of stock options and restricted shares of common stock.

A stock option is the right to purchase shares of common stock at a future date at a specified price per share. The per share exercise price of an option generally may not be less than the fair market value of a share of common stock on the date of grant. The maximum term of an option is ten years from the date of grant. An option may either be an incentive stock option or a nonqualified stock option. Incentive stock option benefits are taxed differently from nonqualified stock options, as described under "Federal Income Tax Consequences of Awards Under the Plan" below. Incentive stock options are also subject to more restrictive terms and are limited in amount by the U.S. Internal Revenue Code (the "Code") and the Equity Plan. Incentive stock options may only be granted to employees of our company or a subsidiary.

Restricted shares are shares of common stock granted to Equity Plan participants, subject to such restrictions, terms and conditions, if any, as the Administrator deems appropriate, including, without limitation, (a) restrictions on the sale, assignment, transfer, hypothecation or other disposition of such shares, (b) the requirement that the participant deposit such shares with our company while such shares are subject to such restrictions, and (c) the requirement that such shares be forfeited upon termination of employment or service with our company for any reason or for specified reasons within a specified period of time or for other reasons (including, without limitation, the failure to achieve designated performance goals). Upon satisfaction or lapse of the applicable restrictions, terms, and conditions, subject to applicable securities laws, the participant will receive shares of common stock in exchange for such restricted shares.

***Dividend Equivalents; Deferrals*.** The Administrator may provide for the deferred payment of awards and may determine the other terms applicable to deferrals. The Administrator may provide that awards under the Equity Plan earn dividends or dividend equivalents based on the amount of dividends paid on outstanding shares of common stock.

***Assumption and Termination of Awards*.** Generally, and subject to limited exceptions set forth in the Equity Plan, if we dissolve or undergo certain corporate transactions such as a merger, business combination, or other reorganization, or a sale of substantially all of its assets, all awards then-outstanding under the Equity Plan will become fully vested or paid, as applicable, and will terminate or be terminated in such circumstances, unless the Administrator provides for the assumption, substitution or other continuation of the award. The Administrator also has the discretion to establish other change in control provisions with respect to awards granted under the Equity Plan. For example, the Administrator could provide for the acceleration of vesting or payment of an award in connection with a corporate event that is not described above and provide that any such acceleration shall be automatic upon the occurrence of any such event.

***Clawback*.** We may cancel any award under the Equity Plan, require reimbursement from a participant, and effect any other right of recoupment of equity or other compensation provided under the Equity Plan in accordance with any clawback policies adopted by us.

***Transfer Restrictions*.** Subject to certain exceptions contained in the Equity Plan, awards under the Equity Plan generally are not transferable by the recipient other than by will or the laws of descent and distribution and are generally exercisable, during the recipient's lifetime, only by the recipient. Any amounts payable or shares issuable pursuant to an award generally will be paid only to the recipient or the recipient's beneficiary or representative. The Administrator has discretion, however, to establish written conditions and procedures for the transfer of awards to other persons or entities, provided that such transfers comply with applicable federal and state securities laws.

***Adjustments*.** As is customary in incentive plans of this nature, each share limit and the number and kind of shares available under the Equity Plan and any outstanding awards, as well as the exercise or purchase prices of awards, and performance targets under certain types of performance-based awards, are subject to adjustment in the event of certain reorganizations, mergers, combinations, recapitalizations, stock splits, stock dividends, or other similar events that change the number or kind of shares outstanding, and extraordinary dividends or distributions of property to the stockholders.

***No Limit on Other Authority*.** The Equity Plan does not limit the authority of the Board or any committee to grant awards or authorize any other compensation, with or without reference to our common stock, under any other plan or authority.

***Termination of or Changes to the Equity Plan*.** The Board may amend or terminate the Equity Plan at any time and in any manner. Stockholder approval for an amendment will be required only to the extent then required by applicable law or any applicable listing agency or required under Sections 422 or 424 of the Code to preserve the intended tax consequences of the plan. For example, stockholder approval will be required for any amendment that proposes to increase the maximum number of shares that may be delivered with respect to awards granted under the Equity Plan (adjustments as a result of stock splits or similar events will not, however, be considered an amendment requiring stockholder approval). Unless terminated earlier by the Board, the authority to grant new awards under the Equity Plan will terminate on October 4, 2031. Outstanding awards, as well as the Administrator's authority with respect thereto, generally will continue following the expiration or termination of the Equity Plan. Generally speaking, outstanding awards may be amended by the Administrator (except for a repricing), but the consent of the award holder is required if the amendment (or any Equity Plan amendment) materially and adversely affects the holder.

***Federal Income Tax Consequences of Awards under the Plan.***

The U.S. federal income tax consequences of the Equity Plan under current federal law, which is subject to change, are summarized in the following discussion of the general tax principles applicable to the Equity Plan. This summary is not intended to be exhaustive and, among other considerations, does not describe the deferred compensation provisions of Section 409A of the Code to the extent an award is subject to and does not satisfy those rules, nor does it describe certain elections under the Code (such as an election under Code Section 83(b)), alternative minimum tax, or state, local, or international tax consequences.

With respect to nonqualified stock options, we are generally entitled to deduct, and the participant recognizes taxable income in an amount equal to the difference between the option exercise price and the fair market value of the shares at the time of exercise. With respect to incentive stock options, we are generally not entitled to a deduction nor does the participant recognize income at the time of exercise, although the participant may be subject to the U.S. federal alternative minimum tax. Upon a disposition of shares acquired by exercise of an incentive stock option before the end of the applicable incentive stock option holding periods, the participant generally must recognize ordinary income equal to the lesser of (i) the fair market value of the shares at the date of exercise minus the exercise price or (ii) the amount realized upon the disposition of the incentive stock option shares minus the exercise price. Otherwise, a participant's disposition of shares acquired upon the exercise of an option (including an incentive stock option for which the incentive stock option holding periods are met) generally will result in only capital gain or loss.

With respect to restricted shares, we are generally entitled to deduct and the participant recognizes taxable income in an amount equal to the excess of the fair market value over the price paid (if any) only at the time the restrictions lapse (unless the recipient elects to accelerate recognition as of the date of grant).

If an award is accelerated under the Equity Plan in connection with a "change in control" (as this term is used under the Code), we may not be permitted to deduct the portion of the compensation attributable to the acceleration ("parachute payments") if it exceeds certain threshold limits under the Code (and certain related excise taxes may be triggered).

We have the authority and the right to deduct or withhold, or require a participant to remit to us, an amount sufficient to satisfy any income, payroll, and other taxes (including, without limitation, pursuant to the Federal Insurance Contributions Act and the Federal Unemployment Tax Act) to the extent required by law to be withheld with respect to any taxable event concerning a participant arising as a result of an award under the Equity Plan.

**Incentive Plan Awards**

No equity awards or grants were made to our named executive officers during the fiscal year ended December 31, 2025.

**Outstanding Equity Awards at Fiscal Year-End**

The following table sets forth outstanding equity awards to our named executive officers as of December 31, 2025.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Option/Warrants Awards** | **Option/Warrants Awards** | **Option/Warrants Awards** | | **Stock Awards** | **Stock Awards** |
| <br>**Name** | **Number of Securities Underlying Unexercised Options/Warrants (#) Exercisable** | **Number of Securities Underlying Unexercised Options/Warrants (#) Unexercisable** | **Exercise Price**<br> **($)** | <br>**Expiration Date** | **Number of Shares or Units of Stock that have not Vested** | **Market Value of Shares or Units of Stock that have not Vested** |
| Michael Campbell (1) | 3545801 |  | $0.54 | 12/31/2028 |  |  |
| Michael Campbell (1) | 500000 |  | 0.54 | 12/31/2030 |  |  |
| Michael Campbell (2) | 333333 | 166667 | 0.54 | 12/6/2030 |  |  |
| Michael Campbell (3) |  | 500000 | 0.54 | 12/6/2030 |  |  |
| Joel D. Stone (2) | 333333 | 166667 | 0.50 | 12/6/2030 |  |  |
| Joel D. Stone (3) |  | 500000 | 0.50 | 12/6/2030 |  |  |
| Joel D. Stone (4) |  | 1250000 | 0.50 | 6/19/2030 |  |  |
| Joel D. Stone (5) | 400000 | 200000 | 0.54 | 6/19/2030 |  |  |
| Joel D. Stone (5) | 433334 | 216668 | 0.54 | 6/19/2030 |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Granted
 on December 6, 2023. Represents fully-vested options/warrants granted to M1 Advisors LLC, a company controlled by Michael Campbell.

(2) Granted
 on December 6, 2023. One third vest on 1<sup>st</sup> anniversary of grant date, one third on the 2<sup>nd</sup> anniversary of grant
 date and one third on the 3rd anniversary of grant date.

(3) Granted
 on December 6, 2023. These options vest at various times based on the achievement of various performance milestones.

(4) Granted
 on June 19, 2023. These options vest at various times based on the achievement of various performance milestones.

(5) Granted
 on June 19, 2023. One third vest on 1<sup>st</sup> anniversary of grant date, one third on the 2<sup>nd</sup> anniversary of grant
 date and one third on the 3rd anniversary of grant date.

**Aggregated Option Exercises**

There were no options exercised by any officer or director of our company during the year ended December 31, 2025.

**Director Compensation**

*General.* The following discussion describes the significant elements of the expected compensation program for members of our board of directors and its committees. The compensation of our directors is designed to attract and retain committed and qualified directors and to align their compensation with the long-term interests of our shareholders. Directors who are also executive officers (each, an "Excluded Director") will not be entitled to receive any compensation for his or her service as a director, committee member or Chair of our board of directors or of any committee of our board of directors.

*Director Compensation Arrangements.* Our non-employee director compensation program is designed to attract and retain qualified individuals to serve on our board of directors. Our board of directors, on the recommendation of our compensation committee, will be responsible for reviewing and approving any changes to the directors' compensation arrangements. In consideration for serving on our board of directors, each director (other than Excluded Directors) will be paid an annual retainer. All directors will be reimbursed for their reasonable out-of-pocket expenses incurred while serving as directors.

*Cash Compensation.* We did not pay any cash compensation to our directors during the years ended December 31, 2025 or 2024. However, we intend to implement a cash compensation program for our board members in the future.

*Equity Awards.* We did not grant any compensatory equity awards to our directors during the year ended December 31, 2025. However, we intend to implement a program for the grant of equity awards to our board members in the future.

**Pension and Retirement Plans**

Currently, we do not offer any annuity, pension or retirement benefits to be paid to any of our officers, directors or employees, in the event of retirement.

**Item 12.** **Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.**

The following table sets forth, as of March 16, 2026, the names, addresses and number of shares of common stock beneficially owned by (i) all persons known to our management to be beneficial owners of more than 5% of the outstanding shares of our common stock, (ii) each director of our company, (iii) each named Executive Officer and (iv) all executive officers and directors of our company as a group (except as indicated, each beneficial owner listed exercises sole voting power and sole dispositive power over the shares beneficially owned):

---

| | | |
|:---|:---|:---|
| **Name and Address of Beneficial Owner** | **Amount and<br> Nature of<br> Beneficial<br> Ownership** | **Percent of<br> Class(1)** |
| Officers and Directors |  |  |
| Michael Campbell<sup>(2)</sup> | 13233333 | 44.0% |
| Joel Stone<sup>(3)</sup> | 1166667 | 4.3% |
| Dean Skupen<sup>(4)</sup> | 325000 | 1.3% |
| Steven Shum<sup>(5)</sup> | 565010 | 2.2% |
| Sean Fontenot<sup>(6)</sup> |  |  |
| All executive officers and directors as a group (5 Persons) | 15290010 | 48.3% |
| 10% Stockholder |  |  |
| SFO IDF, LLC<sup>(7)</sup> | 17783263 | 39.7% |

---

(1) As
 of March 16, 2025, there were 25,730,540 shares of common stock outstanding. Except as indicated in the footnotes to this table,
 we believe that all persons named in the table have sole voting and investment power with respect to all common stock shown as beneficially
 owned by them. In accordance with the rules of the Securities and Exchange Commission (the "Commission"), a person or
 entity is deemed to be the beneficial owner of common stock that can be acquired by such person or entity within sixty (60) days
 upon the exercise of options or warrants or other rights to acquire common stock. Each beneficial owner's percentage of ownership
 is determined by assuming that options and warrants that are held by such person (but not those held by any other person) and which
 are exercisable within sixty (60) days have been exercised. The inclusion herein of such shares listed as beneficially owned does
 not constitute an admission of beneficial ownership.

(2) Represents
 (i) 8,854,199 shares of common stock owned of record by M1 Advisors LLC, a company controlled by Michael Campbell, (ii) currently-exercisable
 warrants to purchase 3,545,801 shares of common stock owned of record by M1 Advisors LLC, (iii) currently-exercisable stock options
 to purchase 500,000 shares of common stock owned by M1 Advisors LLC, and (iv) currently-exercisable stock options to purchase 333,333
 shares of common stock owned by Michael Campbell. The address of Michael Campbell and M1 Advisors LLC is 11753 Willard Avenue, Tustin,
 CA 92782. Mr. Campbell has sole voting and investment power over the shares held by M1 Advisors LLC.

(3) Represents
 currently-exercisable stock options to purchase 1,166,667 shares of common stock owned by Joel Stone.

(4) Represents
 shares of common stock owned of record by DSS Consulting Corporation, a company controlled by Dean Skupen. DSS Consulting Corporation's
 address is 30 N Gould Street, Suite 12829, Sharidan, WY 82801 Mr. Skupen has sole voting and investment power over the shares held
 by DSS Consulting Corporation.

(5) Represents
 (i) 161,010 shares of common stock owned of record and (ii) currently
 exercisable stock options to purchase 404,000 shares of common stock.

(6) Does not include shares of common stock beneficially owned by SFO IDF LLC, a single member limited liability company owned and controlled
by a trust established for the benefit of certain family members of Mr. Fontenot, the trustee of which is independent and not affiliated
with Mr. Fontenot. Mr. Fontenot has no voting or investment power over the securities held by SFO IDF LLC and disclaims beneficial ownership
of such securities.

(7) Represents (i) 9,074,386 shares of common stock owned of record, (ii) currently exercisable warrants to purchase 7,958,877 shares of common
stock, and (iii) currently exercisable stock options to purchase 750,000 shares of common stock.

**Item 13.** **Certain Relationships and Related Transactions, and Director Independence.**

A "related party transaction" is any actual or proposed transaction, arrangement or relationship or series of similar transactions, arrangements or relationships, including those involving indebtedness not in the ordinary course of business, to which we or our subsidiaries were or are a party, or in which we or our subsidiaries were or are a participant, in which the amount involved exceeded or exceeds the lesser of (i) $120,000 or (ii) one percent of the average of our total assets at year-end for the last two completed fiscal years and in which any related party had or will have a direct or indirect material interest. A "related party" includes:

● any person who is, or at any time during the applicable period was, one of our executive officers or one of our directors;

● any person who beneficially owns more than 5% of our common stock;

● any immediate family member of any of the foregoing; or

● any entity in which any of the foregoing is a partner or principal or in a similar position or in which such person has a 10% or greater beneficial ownership interest.

Other than compensation arrangements for our named executive officers and directors, which we describe herein, the only related party transactions to which we were a party during the years ended December 31, 2025 and 2024, since December 31, 2025, or any currently proposed related party transaction, are as follows.

Between December 11, 2023 and February 20, 2024, we entered into a series of exchange subscription agreements (each, an "Exchange Agreement") with 14 holders (each, a "Holder") of our outstanding promissory notes and, in certain cases, related outstanding stock purchase warrants, pursuant to which we and the Holders agreed to exchange their promissory notes, and, if applicable, related stock purchase warrants, for shares of our common stock. Pursuant to the Exchange Agreements, an aggregate of $5,417,459.50 of principal and accrued interest under the outstanding promissory notes and, if applicable, related stock purchase warrants was exchanged for an aggregate of 10,834,919 shares of common stock (the "Exchange Shares"). Nanosha Investments LLC, a limited liability company controlled by Sean Fontenot, a director of our company ("Nanosha"), entered into an Exchange Agreement with us pursuant to which it exchanged (i) a promissory note with outstanding principal and accrued interest in the aggregate amount of $4,287,193, and (ii) a warrant for the purchase of 1,540,000 shares of common stock, for 8,574,386 of the Exchange Shares.

On February 12, 2024, Nanosha made a loan to us in the amount of $1,000,000 in consideration for which we issued to Nanosha a promissory note in the principal amount of $1,000,000 that bore interest at the rate of 10% per annum and originally matured on May 30, 2024 and a five-year warrant to purchase up to 200,000 shares of common stock with an initial exercise price of $0.50 per share. On May 30, 2024, we issued to Nanosha a five-year warrant to acquire 300,000 shares of common stock with an exercise price of $3.50 per share in consideration for the agreement of Nanosha to extend the maturity date of our promissory note from May 30, 2024 to August 31, 2024 and on August 31, 2024, we issued to Nanosha a five-year warrant to acquire 300,000 shares of common stock with an exercise price of $3.80 per share in consideration for the agreement of Nanosha to extend the maturity date of our promissory note from August 31, 2024 to December 31, 2024.

On December 15, 2024, we entered into an exchange subscription agreement with Nanosha pursuant to which Nanosha exchanged (i) the promissory note we issued to Nanosha on February 12, 2024 in the principal amount of $1,000,000, and (ii) the warrants we issued to Nanosha on May 30, 2024 and August 31, 2024 for the purchase of an aggregate of 600,000 shares of common stock, for (a) 500,000 shares of common stock and (b) a five-year warrant to purchase an aggregate of 2,258,877 shares of common stock for a purchase price of $2.00 per share. In connection with such exchange, we paid accrued interest on the exchanged promissory note in the amount of $105,918 in cash.

On April 22, 2025, SFO IDF LLC, a company owned and controlled by a trust established for the benefit of certain family members of Mr. Fontenot, the trustees of which are independent and not affiliated with Mr. Fontenot ("SFO IDF"), made a loan to us in the amount of $250,000 in consideration for which we issued to SFO IDF a promissory note in the principal amount of $250,000 that bears interest at the rate of 10% per annum and originally matured on August 31, 2026 and a five-year warrant to purchase up to 500,000 shares of common stock with an exercise price of $0.49 per share. In connection with such loan, we also agreed to reduce the exercise price of the warrant issued to Nanosha on December 15, 2024 from $2.00 per share to $0.49 per share.

On July 22, 2025, SFO IDF made a loan to us in the amount of $500,000 in consideration for which we issued to SFO IDF a promissory note in the principal amount of $500,000 that bears interest at the rate of 10% per annum and originally matured on January 31, 2026 and a five-year warrant to purchase up to 2,000,000 shares of common stock with an exercise price of $0.50 per share. In connection with such loan, SFO IDF also agreed to extend the maturity date of the promissory note we issued to SFO IDF on April 22, 2025 from August 31, 2025 to January 31, 2026.

On December 15, 2025, SFO IDF made a loan to us in the amount of $250,000 in consideration for which we issued to SFO IDF a promissory note in the principal amount of $250,000 that bears interest at the rate of 10% per annum and matures on June 30, 2026 and a five-year warrant to purchase up to 1,000,000 shares of common stock with an initial exercise price of $0.50 per share. In connection with such loan, SFO IDF also agreed to extend the maturity dates of the promissory notes we issued to SFO IDF on April 22, 2025 and July 22, 2025 from January 31, 2026 to June 30, 2026.

**Item 14.** **Principal Accountant Fees and Services.**

*Audit Fees*

The aggregate fees billed for professional services rendered by RBSM LLP, our principal accountants for the years ended December 31, 2025 and 2024, for the audit of financial statements, quarterly reviews of our interim financial statements and services normally provided by the independent accountant in connection with statutory and regulatory filings or engagements for these periods were as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Years ended**<br> **December 31,** | **For the Years ended**<br> **December 31,** |
|  | **2025** | **2024** |
| Audit Fees and Audit Related Fees | $72500 | $45000 |
| Tax Fees |  |  |
| All Other Fees |  |  |
| Total | $72500 | $45000 |

---

In the above table, "audit fees" are fees billed by our company's external auditor for services provided in auditing our company's financial statements for the periods indicated above. "Audit-related fees" are fees not included in audit fees that are billed by the auditor for assurance and related services, including quarterly reviews, that are reasonably related to the performance of the audit of our company's financial statements. "Tax fees" are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning. "All other fees" are fees billed by the auditor for products and services not included in the foregoing categories.

Our board of directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by our board of directors either before or after the respective services were rendered.

**PART IV**

---

| | |
|:---|:---|
| **Item.15.** | **Exhibits, Financial Statement Schedules.** |

---

---

| | |
|:---|:---|
| **Exhibit**<br>**Number** | <br>**Description** |
| 3.1 | [Restated Articles of Incorporation (incorporated by reference to Exhibit 3.1 to our Quarterly Report of Form 10-Q filed on May 15, 2024).](https://www.sec.gov/Archives/edgar/data/1174891/000149315224019662/ex3-1.htm) |
| 3.2 | [Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed on July 19, 2013).](https://www.sec.gov/Archives/edgar/data/1174891/000138713113002568/ex-3_2.htm) |
| 4.1 | [Description of Registered Securities (incorporated by reference to Exhibit 4.1 to our Annual Report on Form 10-K filed on April 2, 2025)](https://www.sec.gov/Archives/edgar/data/1174891/000164117225002190/ex4-1.htm) |
| 10.1 | [2021 Equity Incentive Plan (incorporated by reference to Exhibit Annex A to our Schedule 14C Information Statement filed on October 21, 2021).](https://www.sec.gov/Archives/edgar/data/1174891/000149315221025982/formdef14c.htm) |
| 10.2 | [Consulting Agreement dated as of October 10, 2018 between CalEthos, Inc. and DSS Consulting Corporation (incorporated by reference to Exhibit 10.12 to our Annual Report on Form 10-K filed on March 31, 2022).](https://www.sec.gov/Archives/edgar/data/1174891/000149315222008391/ex10-12.htm) |
| 10.3 | [Employment Agreement dated as of March 27, 2026 between CalEthos, Inc. and Joel Stone.](ex10-3.htm) |
| 10.4 | [Warrant dated November 28, 2023 of CalEthos issued to M1 Advisors LLC (incorporated by reference to Exhibit 10.4 to our Annual Report on Form 10-K filed on April 2, 2025).](https://www.sec.gov/Archives/edgar/data/1174891/000164117225002190/ex10-4.htm) |
| 10.5 | [Warrant dated February 12, 2024 of CalEthos, Inc. issued to Nanosha Investments LLC. (incorporated by reference to Exhibit 10.5 to our Annual Report on Form 10-K filed on April 9, 2024.](https://www.sec.gov/Archives/edgar/data/1174891/000149315224014061/ex10-5.htm) |
| 10.6 | [Warrant dated December 15, 2024 of CalEthos, Inc. issued to Nanosha Investments LLC (incorporated by reference to Exhibit 10.6 to our Annual Report on Form 10-K filed on April 2, 2025).](https://www.sec.gov/Archives/edgar/data/1174891/000164117225002190/ex10-6.htm) |
| 10.7 | [Warrant dated April 22, 2025 of CalEthos, Inc. issued to SFO IDF LLC](ex10-7.htm) |
| 10.8 | [Warrant dated July 22, 2025 of CalEthos, Inc. issued to SFO IDF LLC](ex10-8.htm) |
| 10.9 | [Warrant dated December 15, 2025 of CalEthos Inc. issued to SFO IDF LLC](ex10-9.htm) |
| 14 | [Code of Conduct and Ethics of CalEthos Inc. (incorporated by reference to Exhibit 14 to our Annual Report on Form 10-K filed on March 31, 2022).](https://www.sec.gov/Archives/edgar/data/1174891/000149315222008391/ex14.htm) |
| 31.1 | [Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.\*\*\*](ex31-1.htm) |
| 31.2 | [Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.\*\*\*](ex31-2.htm) |
| 32.1 | [Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.\*\*\*](ex32-1.htm) |
| 101.ins\*\* | Inline XBRL Instance Document |
| 101.xsd\*\* | Inline XBRL Taxonomy Extension Schema Document |
| 101.cal\*\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.def\*\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.lab\*\* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.pre\*\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| \*\* | Furnished. Not filed. Not incorporated by reference. Not subject to liability. |
| \*\*\* | A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. |

---

**SIGNATURES**

Pursuant to the requirements of the Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on the 31st day of March 2026.

---

| | |
|:---|:---|
| **CalEthos, Inc.** | **CalEthos, Inc.** |
| By: | */s/ Joel D. Stone* |
| Name: | Joel D. Stone |
| Title: | Chief Executive Officer |
|  | (Principal Executive Officer) |

---

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| */s/ Joel D. Stone* | Chief Executive Officer and Director | March 31, 2026 |
| Joel D. Stone | *(Principal Executive Officer)* |  |
| */s/ Dean S. Skupen* | Chief Financial Officer | March 31, 2026 |
| Dean S. Skupen | *(Principal Accounting Officer)* |  |
| */s/ Michael Campbell* | Director | March 31, 2026 |
| Michael Campbell |  |  |
| */s/ Sean Fontenot* | Director | March 31, 2026 |
| Sean Fontenot |  |  |
| */s/ Steven Shum* | Director | March 31, 2026 |
| Steven Shum |  |  |

---

**PART IV**

**Item 15. Exhibits, Financial Statement Schedules.**

(a) The following documents are filed as part of this Report:

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm](#f_001) (PCAOB 587); RBSM LLP | F-2 |
| [Consolidated Balance Sheets as of December 31, 2025 and 2024](#f_002) | F-3 |
| [Consolidated Statements of Operations and Comprehensive Loss for the Years Ended December 31, 2025 and 2024](#f_003) | F-4 |
| [Consolidated Statements of Changes in Stockholders' Equity for the Years Ended December 31, 2025 and 2024](#f_004) | F-5 |
| [Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024](#f_005) | F-6 |
| [Notes to Consolidated Financial Statements](#f_006) | F-7 |

---

---

| | |
|:---|:---|
| ![](audit_001.jpg) | 805 Third Avenue<br> New York, NY 10022<br> Tel. 212.838.5100<br> Fax 212.838.2676<br> www.rbsmllp.com |

---

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Board of Directors and Stockholders of

CalEthos, Inc.

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of CalEthos, Inc., (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, changes in stockholders' equity and cash flows for each of the years in the two-year period ended December 31, 2025, and the related notes and schedules (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the consolidated results of its operations and its cash flows for each of the two years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America.

**The Company's Ability to Continue as a Going Concern**

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the accompanying consolidated financial statements, although the Company has net income it is primarily attributable to non-cash reversal of compensation for restricted stock units, has generated negative cash flows from operating activities, has an accumulated deficit and has stated that substantial doubt exists about Company's ability to continue as a going concern. Management's evaluation of the events and conditions and management's plans regarding these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

**Basis for Opinion**

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

**Critical Audit Matters**

The critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. RBSM determined there were no CAM's for the audit of the year ended December 31, 2025.

/s/ RBSM LLP

We have served as the Company's auditor since 2018.

New York, NY

March 31, 2026

PCAOB ID No. 587

**CalEthos, Inc.**

**Consolidated Balance Sheets**

**As of December 31,** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| **Assets** |  |  |
| Current assets |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $287000 | $286000 |
| &nbsp;&nbsp;&nbsp;Prepaid and other current expenses | 8000 | 10000 |
| &nbsp;&nbsp;&nbsp;Total current assets | 295000 | 296000 |
| Data center campus costs | - | 5849000 |
| &nbsp;&nbsp;&nbsp;Total assets | $295000 | $6145000 |
| Liabilities and stockholders' (deficit) equity |  |  |
| Current liabilities |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | $775000 | $504000 |
| &nbsp;&nbsp;&nbsp;Notes payable – related parties, net | 739000 | 11000 |
| &nbsp;&nbsp;&nbsp;Convertible debentures, net | 1581000 | - |
| &nbsp;&nbsp;&nbsp;Total current liabilities | 3095000 | 515000 |
| Convertible debentures, net | - | 1313000 |
| Total liabilities | 3095000 | 1828000 |
| Stockholders' (deficit) equity |  |  |
| &nbsp;&nbsp;&nbsp;Common stock par value $0.001: 100,000,000 shares authorized; 25,730,540 and 25,730,540 shares issued and outstanding | 26000 | 26000 |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 35543000 | 36153000 |
| &nbsp;&nbsp;&nbsp;Other comprehensive income |  | 9000 |
| &nbsp;&nbsp;&nbsp;Stock subscription receivable | (1000) | (1000) |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (38368000) | (31870000) |
| Total stockholders' (deficit) equity | (2800000) | 4317000 |
| Total liabilities and stockholders' (deficit) equity | $295000 | $6145000 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**CalEthos, Inc.**

**Consolidated Statements of Operations and Comprehensive Loss**

**For the Years Ended December 31,**

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| **Revenues** | $- | $- |
| **Operating Expenses** |  |  |
| Professional fees | 340000 | 386000 |
| Equity-based compensation | 80000 | 369000 |
| General and administrative expenses | 52000 | 49000 |
| Payroll and related expense | 583000 | 259000 |
| Total operating expenses | 1055000 | 1063000 |
| **Loss from operations** | (1055000) | (1063000) |
| **Other income (expenses)** |  |  |
| Interest income | 5000 | 12000 |
| Financing costs | (186000) | (12000) |
| Financing costs – related party | (676000) | (2398000) |
| Abandoned of development project cost | (4594000) | (344000) |
| Gain from closure of foreign subsidiary | 8000 |  |
| Loss on extinguishment of notes payable – related party |  | (2317000) |
| Loss on extinguishment of convertible promissory notes | - | (6468000) |
| Total other expenses | (5443000) | (11527000) |
| Loss before provision for income taxes | (6498000) | (12590000) |
| Provision for income taxes | - | - |
| Net loss | (6498000) | (12590000) |
| Net loss per share - Basic and Diluted | $(0.25) | $(0.50) |
| Weighted Average common shares outstanding - Basic and Diluted | 25730540 | 25152137 |
| Comprehensive (loss) income |  |  |
| Net loss | (6498000) | (12590000) |
| Foreign currency translation loss | (9000) | - |
| Comprehensive loss | $(6507000) | $(12590000) |

---

The accompanying notes are an integral part of these consolidated financial statements.

**CalEthos, Inc.**

**Consolidated Statements of Stockholders' (Deficit) Equity**

**For the Years Ended December 31, 2025 and 2024**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Common Stock | Common Stock | | | | | |
|  | Shares | Amount | Additional Paid-in<br>Capital | Stock Subscription<br>Receivable | Other Comprehensive<br>Income | Accumulated<br>Deficit | Total<br> Stockholders'<br> (deficit)<br>equity  |
| Balance, December 31, 2023 | 24345598 | $24000 | $20807000 | $(2000) | $9000 | $(19280000) | $1558000 |
| Shares issued for extinguishment of debt Convertible Debentures | 884942 | 1000 | 6927000 |  |  |  | 6928000 |
| Warrants issued for note payable extension |  |  | 2355000 |  |  |  | 2355000 |
| Shares issued for extinguishment of notes payable | 500000 | 1000 | 874000 |  |  |  | 875000 |
| Warrants issued for extinguishment of notes payable |  |  | 2441000 |  |  |  | 2441000 |
| Proceeds for stock subscription receivable |  |  |  | 1000 |  |  | 1000 |
| Equity-based compensation |  |  | 2749000 |  |  |  | 2749000 |
| Net loss | - | - | - | - | - | (12590000) | (12590000) |
| Balance December 31, 2024 | 25730540 | 26000 | 36153000 | (1000) | 9000 | (31870000) | 4317000 |
| Equity-based compensation capitalized |  |  | 427000 |  |  |  | 427000 |
| Reversal of capitalized equity-based compensation |  |  | (2022000) |  |  |  | (2022000) |
| Equity-based compensation expensed |  |  | 316000 |  |  |  | 316000 |
| Reversal of current year equity-based compensation |  |  | (236000) |  |  |  | (236000) |
| Warrants issued to note payable - related party |  |  | 885000 |  |  |  | 885000 |
| Foreign currency translation loss |  |  |  |  | (9000) |  | (9000) |
| Warrant repricing with financing – related party | - | - | 20000 | - | - | - | 20000 |
| Net loss | - | - | - | - | - | (6498000) | (6498000) |
| Balance December 31, 2025 | 25730540 | $26000 | $35543000 | $(1000) | $- | $(38368000) | $(2800000) |

---

The accompanying notes are an integral part of these consolidated financial statements.

**CalEthos, Inc.**

**Consolidated Statements of Cashflow**

**For the Year Ended December 31,** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Cash Flows From Operating Activities |  |  |
| Net loss | $(6498000) | $(12590000) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Abandoned data center campus development costs | 4581000 | 344000 |
| &nbsp;&nbsp;&nbsp;Gain from disposal of foreign subsidiary | (8000) |  |
| &nbsp;&nbsp;&nbsp;Loss on extinguishment of notes payable – related party |  | 2317000 |
| &nbsp;&nbsp;&nbsp;Amortization of note payable discounts – related party | 613000 | 2355000 |
| &nbsp;&nbsp;&nbsp;Warrant repricing with financing – related party | 20000 | - |
| &nbsp;&nbsp;&nbsp;Amortization of debt issuance cost | 53000 | 9000 |
| &nbsp;&nbsp;&nbsp;Fair value of equity-based compensation | 80000 | 369000 |
| &nbsp;&nbsp;&nbsp;Loss on extinguishment of debt |  | 6468000 |
| Changes in operating assets and liabilities |  |  |
| Prepaid expenses and other current assets | 2000 |  |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | 407000 | (131000) |
| Net cash used in operating activities | (750000) | (859000) |
| Cash Flows From Investing Activities |  |  |
| Date center campus development cost | (464000) | (1467000) |
| Net cash used in investing activities | (464000) | (1467000) |
| Cash Flows From Financing Activities |  |  |
| Cash proceeds from issuance of convertible debentures | 225000 | 1410000 |
| Cost for issuance of convertible debentures | (10000) | (106000) |
| Proceeds from stock subscription receivable |  | 1000 |
| Cash proceeds for issuances of notes payable | 1000000 | 1000000 |
| Net cash provided by financing activities | 1215000 | 2305000 |
| Effect of exchange rate changes on cash and cash equivalents | - | (1000) |
| Net decrease in cash and cash equivalents | 1000 | (22000) |
| Cash and cash equivalents, beginning of period | 286000 | 308000 |
| Cash and cash equivalents, end of period | $287000 | $286000 |
| Supplemental disclosure of cash flow information: |  |  |
| Cash paid for interest | $— | $100000 |
| Cash paid for income taxes | $— | $- |
| Non-cash investing and financing activities |  |  |
| Relative fair value of warrants issued with note payable | $885000 | $— |
| Capitalized interest – project development cost | $- | $81000 |
| Common stock and warrants issued for extinguishment of notes payable | $- | $3315000 |
| Equity-based compensation capitalized | $- | $2380000 |
| Convertible debentures accrued interest converted to equity | $- | $459000 |
| Equity-based compensation expensed | $316000 | $- |
| Recapture of equity-based compensation expensed | $(236000) | $- |
| Notes payable converted to equity – related party | $- | $1000000 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**CalEthos, Inc.**

**Consolidated Financial Statements**

**For the Year Ended December 31, 2025 and 2024**

Note 1 – Organization and Accounting Policies

CalEthos, Inc. (the "Company" or "we") was incorporated on March 20, 2002 under the laws of the State of Nevada.

In July 2022, the Company's board of directors resolved to restructure the business of the Company to focus exclusively on the development of a large-scale data center campus, initially in Imperial County, California. In addition, the Company would consider the acquisition of assets or all or part of other companies operating in the clean energy or data center infrastructure industries or opportunities to invest in, or joint venture with, other more-established companies already in the industry that would add value to the Company's business strategy.

After optioning parcels of land in Imperial County and working with the Imperial County planning department and other local regulatory agencies in seeking zoning changes and other required regulatory approvals required for the Company's proposed data center campus, it became evident by May 2025 that the Company's timelines for the receipt of such approvals would not be met. Key factors driving the delay included the need for additional environmental studies, unresolved community concerns, and delays in receiving several outstanding government approvals. As a result, the Company elected not to renew its purchase option on a 315-acres parcel of land in Imperial County when it expired in July 2025 and to shift its development efforts to other locations in which the regulatory environment for data center development and the purchase of available power may be more favorable and the timelines in which the Company may receive all required regulatory approvals may be shorter.

In May 2025, the Company formed TerraVolt Infrastructure Inc. ("TerraVolt"), a wholly-owned subsidiary established to meet the demand for sustainable, baseload, powered land and infrastructure solutions for large-scale data centers development and end users. TerraVolt's proposed solution is an Infrastructure-as-a-Service (IaaS) Platform that will integrate a portfolio of grid and behind-the-meter power with construction-ready data center building sites that include utilities and fiber connectivity. TerraVolt plans to provide this turnkey solution to hyperscalers, colocation providers, and data center developers seeking to deploy new capacity faster than with traditional power generation and transmission.

The Company is currently focusing on properties in states in which onsite power production utilizing natural gas reciprocating engines and turbines are allowed and in which the Company can acquire access to natural gas pipeline and capacity for delivery within a reasonable timeframe.

*Korean Entity*

On November 5, 2021, AIQ System Inc. ("AIQ") was incorporated in Seoul, Republic of Korea. AIQ is authorized to issue 3 million shares of common stock. At the date of incorporation, 10,000 shares were issued to the Company for 100,000,000 Korean Won, or approximately $89,000, for 100% ownership of AIQ. As of July 2022, AIQ was placed into a dormant state of operations. As of January 2025, AIQ had been dissolved.

*Basis of Presentation*

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC").

*Principles of Consolidation*

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary from the formation date. All material intercompany transactions and balances have been eliminated in consolidation.

*Going Concern and Liquidity*

The Company incurred a net loss of approximately $6,498,000 for the year ended December 31, 2025, had an accumulated deficit of approximately $38,368,000 as of December 31, 2025 and had no recurring revenue from operations. The Company has financed its activities principally through debt and equity financing and shareholder contributions. Management expects to incur additional losses and cash outflows in the foreseeable future in connection with its operating activities. These conditions raise substantial doubt about the Company's ability to continue as a going concern for one year from the issuance of these consolidated financial statements.

The Company's consolidated financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The Company is subject to a number of risks similar to those of other similar stage companies, including dependence on key individuals; successful development, marketing and branding of services; the uncertainty of product development and generation of revenues; dependence on outside sources of financing; risks associated with research and development; dependence on third-party suppliers and collaborators; protection of intellectual property; and competition with larger, better-capitalized companies. Ultimately, the attainment of profitable operations is dependent on future events, including locating and contracting to purchase suitable real estate with access to gas pipelines or other suitable power sources, contracting for the purchase of natural gas or otherwise obtaining the necessary power for the development of a data center, obtaining adequate financing to fund the Company's operations and generating a level of revenues adequate to support the Company's cost structure.

The Company will need to raise debt or equity financing in the future in order to continue its operations and achieve its growth targets. However, there can be no assurance that such financing will be available in sufficient amounts and on acceptable terms, when and if needed, or at all. The precise amount and timing of the funding needs cannot be determined accurately at this time The Company believes its cash balances and cash flow from operations will not be sufficient to fund its operations and growth for the next twelve months from the issuance date of these financial statements. If the Company is unable to raise additional funding from investors or through other avenues, it may not be able to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

*Segment Reporting*

The Company's chief operating decision maker ("CODM") is the Company's Chief Executive Officer. The Company operates as one operating segment and uses net income or loss as measures of profit or loss on a consolidated basis in making decisions regarding the allocation of capital resources and performance assessment. Additionally, the Company's CODM regularly reviews the Company's expenses on a consolidated basis. The financial metrics used by the CODM help make key operating decisions, such as determination of the use of capital resources for data center development and general and administrative expenses.

Since the Company operates as one reportable segment, all financial information required by "Segment Reporting" can be found in the accompanying consolidated financial statements. The CODM does not review segment assets at a level other than that presented in the Company's consolidated balance sheets. There are no intra-entity sales or transfers, and no significant expense categories regularly provided to the CODM beyond those disclosed in the Consolidated Statements of Operations.

*Use of Estimates*

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods.

*Foreign Currency Translation*

The financial statements of foreign subsidiaries, for which the functional currency is the local currency, are translated into U.S. dollars using the exchange rate at the consolidated balance sheet date for assets and liabilities and a weighted-average exchange rate during the year for revenue, expenses, gains and losses. Translation adjustments are recorded as other comprehensive income (loss) within shareholders' equity (deficit). Gains or losses from foreign currency transactions are recognized in the consolidated statements of operations.

 

*Fair Value Measurement*

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

---

| | |
|:---|:---|
| Level 1 - | Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. |
| Level 2 - | Other inputs that are directly or indirectly observable in the marketplace. |
| Level 3 - | Unobservable inputs which are supported by little or no market activity. |

---

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

As of and for the years ended December 31, 2025 and 2024, the Company had no assets or liabilities that required fair value measurement.

*Cash and Cash Equivalents*

The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates their fair value. The Company maintains its cash and cash equivalents in banks insured by the Federal Deposit Insurance Corporation ("FDIC") in accounts that at times may be in excess of the federally insured limit of $250,000 per bank. The Company minimizes this risk by placing its cash deposits with major financial institutions. As of December 31, 2025 and 2024, the Company had approximately $31,000 and $23,000, respectively, in excess of the federal insurance limit.

*Prepaid Expenses*

Prepaid expenses are assets held by the Company that are expected to be realized and consumed within twelve months after the reporting period.

*Data Center Campus Costs*

Data center development cost is stated at cost, which includes the cost incurred to complete phase I of the Company's former data center development plan. Phase I costs included the option payment for the land and the cost of consulting firms to provide power and connectivity assessments, feasibility studies, engineering plans, and project benchmarking. Data center development cost also included internal cost such as payroll-related cost and debt interest cost.

In accordance with ASC 360-10-35, the Company reviews the carrying amounts of data center cost when events or changes in circumstances indicate the assets may not be recoverable. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any. Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The recoverable amount is the higher of fair value, less costs of disposal and value in use. In assessing value in use, the estimated future cash flows to be derived from continuing use of the asset or cash-generating unit are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Fair value less costs of disposal is the amount obtainable from the sale of an asset or cash-generating unit in an arm's length transaction between knowledgeable, willing parties, less the cost of disposal. When a binding sale agreement is not available, fair value less costs of disposal is estimated using a discounted cash flow approach with inputs and assumptions consistent with those of a market participant. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the cash-generating unit is reduced to its recoverable amount. An impairment loss is recognized immediately in operating results.

 

*Related Parties*

The Company follows Financial Accounting Standards Board's ("FASB") Accounting Standards Codification ("ASC") section 850-10 for the identification of related parties and disclosure of related-party transactions.

Pursuant to ASC section 850-10-20, the related parties include (a.) affiliates of the Company ("Affiliate" means, with respect to any specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are used in and construed under Rule 405 under the Securities Act); (b.) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option of ASC section 825–10–15, to be accounted for by the equity method by the investing entity; (c.) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d.) principal owners of the Company; (e.) management of the Company; (f.) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g.) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

The consolidated financial statements are required to include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures are required to include: (a.) the nature of the relationship(s) involved; (b.) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c.) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d.) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

*Commitments and Contingencies*

The Company follows ASC section 450-20 to report accounting for contingencies. Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

*Stock-Based Compensation*

The Company accounts for its stock-based compensation under ASC 718, "*Compensation – Stock Compensation*" using the fair value-based method. Under this method, compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period. This guidance establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity's equity instruments or that may be settled by the issuance of those equity instruments.

The Company uses the fair value method for equity instruments granted to non-employees and uses the BSM model for measuring the fair value of options. The stock-based fair value compensation is determined as of the date of the grant (measurement date) and is recognized over the vesting periods.

*Earnings Per Share*

The Company uses ASC 260, "*Earnings Per Share*" for calculating the basic and diluted earnings (loss) per share. The Company computes basic earnings (loss) per share by dividing net income (loss) by the weighted average number of common shares outstanding. Diluted earnings (loss) per share is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding stock options and warrants and stock awards. For periods with a net loss, basic and diluted loss per share is the same, in that any potential common stock equivalents would have the effect of being anti-dilutive in the computation of net loss per share.

Securities that could potentially dilute loss per share in the future were not included in the computation of diluted loss per share for the years ended December 31, 2025 and 2024 because their inclusion would be anti-dilutive. Common stock equivalents amounted to 21,907,913 and 11,326,178 as of December 31, 2025 and 2024, respectively.

*Recent Accounting Pronouncements*

The Company's management reviewed all recently issued accounting standard updates ("ASU's") not yet adopted by the Company and does not believe the future adoption of any such ASU's may be expected to cause a material impact on the Company's consolidated financial condition or the results of its operations.

Note 2 – Data Center Development Costs

On July 22, 2024, the Company entered into an option agreement ("Option") to acquire for a purchase price of $5,000,000 a 315-acre parcel of land ("New Property") in Imperial County, California to be used for the development of the Company's Data Center Campus. With the execution of the Option, the Company paid a non-refundable deposit of $50,000. The Option had an initial term of one year and could have been extended for an additional six-month period by the payment of $75,000 on or before July 21, 2025.

On March 30, 2023, the Company signed an option agreement ("Initial Option") to acquire 80 acres of commercially zoned land ("Initial Property") in Imperial County, California for $3,360,000 ("Purchase Price"). The Initial Property was optioned to be the land used for the Company's Data Center Campus. The Company paid a non-refundable deposit of $84,000 on the signing of the Initial Option. On July 24, 2024 ("Termination Date"), the Company terminated ("Termination") the Initial Option as the Company believed the New Property was better suited for the Company's Data Center Campus project.

As of the Termination Date, the Company had approximately $4,158,000 of cost ("DCC Cost") for the Data Center Campus project. In accordance with ASC 790 and 360, the Company was required to determine the amount of DCC Cost ("Option Cost") associated with the Initial Property. The Option Cost was required to be exposed on the date the Company abandoned the Initial Option. The Company has determined the date of abandonment was the Termination Date. As of the Termination Date, the Company had approximately $344,000 of Option Cost. The remaining DCC Cost was related to the development activities to the overall Data Center Campus and, as such, were not cost associated with the Initial Property.

As disclosed in Note 1 – Organization and Accounting Policies, given the recent development of the Plan and the prolonged uncertainty, the Company elected not to renew its purchase option on the New Property when it expired in July 2025. Consequently, previously capitalized data center development costs were expensed, and the Company will cease capitalizing additional data center development expenses until the Company can secure parcels with appropriate zoning for data center use and greater certainty around the execution of its development plans, as disclosed in Note 1. As of the termination of the data center development, the Company had approximately $4,581,000 of capitalized development cost, which has been recorded as abandoned project costs.

Note 3 – Notes Payable – Related Party

During the year ended December 31, 2024, the Company entered into transactions with Nanosha LLC, ("Nanosha") an entity controlled by the Company's director Sean Fontenot. During December 31, 2025, Nanosha transferred the notes payable and related securities from the December 31, 2024 transactions, as described below to SFO IDF LLC, ("SFO") a single member limited liability company owned and controlled by a trust established for the benefit of certain family members of Mr. Fontenot, the trustee of which is independent and not affiliated with Mr. Fontenot. Mr. Fontenot has no voting or investment power over the securities held by SFO and disclaims beneficial ownership of such securities. The Company has determined that SFO is a related party given SFO was established to benefit Mr. Fontenot's family members.

Notes payable – related party transactions are summarized for the periods as follows for the years ended December 31,

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| Principal |  |  |
| Balance, beginning of the period | $11000 | $11000 |
| Additions | 1000000 | 1000000 |
| Settlement | - | (1000000) |
| Balance, end of the period | 1011000 | 11000 |
| Discount |  |  |
| Balance, beginning of the period |  |  |
| Additions | 885000 | 2355000 |
| Amortization | (613000) | (2355000) |
| Balance, end of the period | 272000 | - |
| Net carrying amount | $739000 | $11000 |

---

In December 2025, the Company issued a $250,000 note payable to the SFO ("Lender") ("December 2025 Note") and extended the April 2025 Note and July 2025 Note (collectively "Extended Notes") maturity dates to June 30, 2026. The December 2025 Note has an interest rate of 10% and the outstanding principal and interest are payable on June 30, 2026. Also, the Company issued the Lender a warrant to purchase 1,000,000 shares of the Company's common stock at $0.50 per share. For accounting purposes, the Company allocated the 1,000,000 warrants equally to the modification of the Extended Notes 500,000 warrants ("Second Modification Warrants") and the December 2025 Note 500,000 warrants ("December 2025 Warrants") (collectively the "Warrants'). The December 2025 Warrant's grant date fair value of approximately $188,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility of 226.53%, the fair value of common stock $0.38, estimated life of 5.5 years, risk-free rate of 3.73% and dividend rate of $0. In accordance with ASC 470 – Debt, the gross proceeds of $250,000 was allocated between the December 20025 Note and the December 2025 Warrants on a relative fair value basis. Therefore, the July 2025 Warrants were recorded at $108,000.

In December 2025, the Company and the Lender agreed to extend the maturity date of the April 2025 Note and July 2025 Note to June 30, 2026, which was accounted for as a modification under ASC 470—Debt. In connection with this modification, the Company issued Second Modification Warrants to the Lender. The fair value of the Modification Warrants, determined to be $188,000 as of the extension date, was recorded as a debt discount. This amount will be amortized over the remaining term of the modified debt.

In July 2025, the Company issued a $500,000 note payable to the Lender ("July 2025 Note") and extended the April 2025 Note's maturity date to January 31, 2026. The July 2025 Note has an interest rate of 10% and the outstanding principal and interest are payable on January 31, 2026. Also, the Company issued to the Lender a warrant to purchase 2,000,000 shares of the Company's common stock at $0.50 per share. For accounting purposes, the Company allocated the 2,000,000 warrants equally to the modification of the April 2025 1,000,000 warrants ("Modification Warrants") and the July 2025 Note 1,000,000 warrants ("July 2025 Warrants") (collectively the "Warrants'). The Warrant's grant date fair value of approximately $555,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility of 226.55%, the fair value of common stock $0.28, estimated life of 5.5 years, risk-free rate of 3.88% and dividend rate of $0. In accordance with ASC 470 – Debt, the gross proceeds of $500,000 was allocated between the July 20025 Note and the July 2025 Warrants on a relative fair value basis. Therefore, the July 2025 Warrants were recorded at $178,000.

In July 2025, the Company and the Lender agreed to extend the maturity date of the April 2025 Note, which was accounted for as a modification under ASC 470—Debt. In connection with this modification, the Company issued Modification Warrants to the Lender. The fair value of the Modification Warrants, determined to be $277,000 as of the extension date, was recorded as a debt discount. This amount will be amortized over the remaining term of the modified debt.

In April 2025, the Company issued a $250,000 note payable to Lender ("April 2025 Note"). The April 2025 Note has an interest rate of 10% and the outstanding principal and interest were initially payable on August 31, 2025, which was extended to January 31, 2026, as described below. Also, the Company issued the Lender a warrant to purchase 500,000 shares ("April 2025 Warrant") of the Company's common stock at $0.49 per share. The April 2025 Warrant grant date fair value of approximately $291,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility of 214.75%, the fair value of common stock $0.59, estimated life of 5.0 years, risk-free rate of 3.98% and dividend rate of $0. In accordance with ASC 470 – Debt, the gross proceeds of $250,000 was allocated between the April 2025 Note and the April 2025 Warrant on a relative fair value basis, therefore, the warrant was recorded at $134,000.

As an inducement to the Lender, the Company agreed to modify the terms of certain Exchange Warrants (as described below) to reduce the exercise price from $2.00 to $0.49. The Company accounted for the warrant modification as a financing cost in accordance with ASC 815, Derivatives and Hedging, which requires recognition of any increase in the fair value of the warrant resulting from the modification. The fair value of the warrants was determined using the Black-Scholes option pricing model, with a fair value of $1,066,000 prior to modification and $1,086,000 after modification, based on a 4.7-year term, volatility of 214.59%, a risk-free interest rate of 3.9%, and a market price of $0.49 per share. The resulting increase in fair value of approximately $20,000 was recorded as a financing cost – related party.

In February 2024, the Company issued a promissory note ("Promissory Note"), to Nanosha, in the principal amount of $1,000,000 that bears interest at the rate of 10% per annum and originally matured on May 31, 2024 ("Maturity Date"). It also issued a five-year warrant to purchase up to 200,000 shares of common stock with an initial exercise price of $0.50 per share ("Finance Warrant").

In accordance with ASC 470 - *Debt*, the Company has allocated $1,000,000 of cash proceeds on a relative fair value to the Promissory Note and the Finance Warrant. The Finance Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately $1,389,000 based on a 2.5-year term, volatility of 159%, a risk-free equivalent yield of 4.1%, and a stock price of $7.21. The Finance Warrant was ascribed a relative fair value of approximately $581,000.

On the Maturity Date, the holder of the Promissory Note agreed to extend the Maturity Date to August 31, 2024 ("Extension Maturity"). As consideration for the Extension, the Company issued to the holder a warrant to purchase 300,000 shares of the Company's common stock with an initial exercise price of $3.50 per share ("Extension Warrant").

The Extension Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately $853,000 based on a 2.5-year term, volatility of 163%, a risk-free equivalent yield of 4.3%, and a stock price of $3.5. The fair value of $853,000 was recorded as a debt discount to be amortized over the Extension period of three months. As of December 31, 2024, the Company had amortized approximately $853,000 of the value of the Extension Warrant.

On the Extension Maturity date, the holder of the Promissory Note agreed to extend the Extension Maturity to December 31, 2024 ("Additional Extension"). As consideration for the Additional Extension date, the Company issued to the holder a warrant to purchase 300,000 shares of the Company's common stock with an initial exercise price of $3.80 per share ("Additional Extension Warrant").

The Additional Extension Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately $921,000 based on a 2.5-year term, volatility of 162%, a risk-free equivalent yield of 3.8%, and a stock price of $3.80. The fair value of $921,000 was recorded as a debt discount to be amortized over the Additional Extension period of four months. As of December 31, 2024, the Company had amortized approximately $921,000 of the value of the Extension Warrant.

On December 15, 2024 ("Exchange Date"), the Company entered into an exchange agreement ("Exchange Agreement") to settle the Promissory Note, pursuant to the Exchange Agreement, the Promissory Note was extinguished as of the Exchange Date and the Extension Warrant and Additional Extension Warrants (collectively "The Extension Warrants") were cancelled. In exchange, the Company (i) made a payment of $100,000 for the accrued and unpaid interest, (ii) issued 500,000 shares of the Company's common stock with a fair value of $1.75 per share (based on the Company's closing on the Exchange Date) ("Exchange Shares"), and issued a warrant to purchase 2,258,877 shares of the Company's common stock at a price of $2.00 per share for a period of five years ("Exchange Warrant'). On the Exchange Date, the Exchange Warrant had a fair value of $3,197,000 calculated using the Black Scholes fair value option-pricing model with key input variables provided by management: volatility of 166%, the fair value of common stock $1.75, estimated life range 2.5 years, risk-free rate of 4.25% and dividend rate of nil.

The Company accounted for the Exchange agreement in accordance with ASC 470 – Debt. Therefore, the Company incurred a $2,317,000 loss on extinguishment, which was the difference between the fair value of The Extension Warrants compared to the aggregate fair value of the Exchange Warrants and Exchange Shares. The loss on extinguishment of note payable – related party was calculated as follows:

SCHEDULE OF LOSS ON EXTINGUISHMENT OF NOTE PAYABLE RELATED PARTY

---

| | |
|:---|:---|
| Loan - principal balance | $1000000 |
| Value The Extension Warrants - cancelled | 755000 |
| Total Consideration | 1755000 |
| Share received | 500000 |
| Stock price | 1.75 |
| Common stock value | 875000 |
| Value of Exchange Warrant | 3197000 |
| Value received | 4072000 |
| Loss on extinguishment of note payable – related party | $2317000 |

---

On the Exchange Date the Extension Warrants had a fair value of $755,000 calculated using the Black Scholes fair value option-pricing model with key input variables provided by management: volatility of 166%, the fair value of common stock $1.75, estimated life range 2.5 years, risk-free rate of 4.25% and dividend rate of nil.

Financing cost for the notes payable – related party amounted to $656,000 and $2,398,000 for the years ended December 31, 2025 and 2024, respectively, of which approximately nil and $60,000, respectively, were capitalized as data center development cost.

Note 4 – Convertible Debentures

CONVERTIBLE DEBENTURES

Convertible debentures transactions are summarized as follows for the years ended December 31,

---

| | | |
|:---|:---|:---|
| Principal | 2025 | 2024 |
| Balance, beginning of period | $1410000 | $341000 |
| Additions | 225000 | 1410000 |
| Conversions | - | (341000) |
| Balance, end of period | 1635000 | 1410000 |
| Debt issuance cost |  |  |
| Balance, beginning of period | 97000 |  |
| Additions | 10000 | 106000 |
| Amortization | (53000) | (9000) |
| Balance, end of period | 54000 | 97000 |
| Net book value | $1581000 | $1313000 |

---

In June 2024, the Company initiated a private placement offering for its convertible debentures (the "Debentures"). The Debentures bear interest at 10.0% per annum with a default interest rate of 15.0% per annum. The principal amount and all accrued interest are payable on December 31, 2026. The holder of the Debentures has the option to convert the unpaid principal and interest into shares of the Company's common stock at the conversion rate of $2.00 per share, subject to adjustment for stock splits, stock dividends and the like and for issuances by the Company of common stock at a price per share that is less than the then-current conversion price, subject to certain exceptions.

In accordance with the Debenture, the Company has the right to prepay the Debentures upon providing 45 day notice of its intention to prepay.

The outstanding principal amount of the Debentures and all accrued interest thereon shall automatically be converted into shares of common stock at the then effective conversion price upon (i) the close of business on the sixtieth (60th) consecutive day on which the VWAP of the Company's common stock is at least $4.00 per share, subject to appropriate adjustment in the event of any stock dividend, stock split, stock combination or other similar recapitalization with respect to the common stock, or (ii) the execution by the Company of a long-term lease with a data center client for all or a substantial portion of the Company's planned data center development project.

For the year ended December 31, 2025, the Company issued Debentures in the principal amount of $225,000 for net proceeds of approximately $215,000.

Interest expense on convertible promissory notes amounted to $159,000 and $32,000 for the years ended December 31, 2025 and 2024, respectively, of which $26,000 and $21,000, respectively, was capitalized as data center campus cost.

Note 5 – Commitments and Contingencies

*Litigation*

From time to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of business. The Company is not currently a party to any material legal proceedings, nor is the Company aware of any pending or threatened litigation that would have a material adverse effect on the Company's business, operating results, cash flows or financial condition should such litigation be resolved unfavorably.

Note 6 – Stockholders Equity

*<u>Stock Options</u>*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number**<br> **of Shares** | **Weighted**<br> **Average**<br> **Strike**<br> **Price/Share** | **Weighted**<br> **Average**<br> **Remaining**<br> **Contractual**<br> **Term**<br> **(Years)** | **Weighted**<br> **Average**<br> **Grant Date**<br> **Fair**<br> **Value/Share** | <br>**Intrinsic**<br> **Value** |
| Balance, December 31, 2023 | 6854000 | $0.53 | 7.0 | $0.51 | $0.44 |
| Granted | 1350000 | 3.24 | 8.8 | 3.15 | 0.09 |
| Forfeited |  |  |  |  |  |
| Exercised |  |  |  |  |  |
| Expired | - | - | - | - | - |
| Balance, December 31, 2024 | 8204000 | 0.97 | 7.8 | 0.94 | 0.73 |
| Granted | 350000 | 1.99 | 8.2 | 1.97 |  |
| Forfeited | 1837500 | 2.33 | 9.1 | 2.08 |  |
| Exercised |  |  |  |  |  |
| Expired | - | - | - | - | - |
| Balance, December 31, 2025 | 6716500 | 0.65 | 6.48 | 0.63 | - |
| Vested and exercisable, December 31, 2025 | 3436500 | 0.66 | 4.85 | 0.65 | - |
| Unvested, December 31, 2025 | 3280000 | $0.64 | 8.19 | $0.62 | $- |

---

The Company had 6,716,500 outstanding stock options as of December 31, 2025, of which 4,291,500 outstanding options had a time-based vesting requirement, and the remaining 2,425,000 outstanding options had a performance-based vesting requirement, as follows:

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| | | |
|:---|:---|:---|
|  | Time-based | Performance-based |
| CEO | 500000 | 500000 |
| COO | 1750000 | 1750000 |
| VP - Senior Counsel | 175000 | 175000 |
| Terminated employees - vested | 212500 |  |
| Non-employees - Vested on issuance | 1654000 | - |
| Total | 4291500 | 2425000 |

---

In May 2025, as described in Note 1 – Organization and Accounting Policies, the Company's management shifted the core focus of the Company's operations. As a result of this strategic shift, the original performance-based milestone included in the employee stock option agreements were determined to be no longer achievable. The original milestones, which were tied to specific legacy business objectives, were rendered obsolete by the revised operational direction of the Company. The stock option agreements provided for the milestones to be modified with the mutual consent of the Company and the employees. In accordance with the terms of the stock option agreements, these milestones were modified by agreement of the Company and the affected employees to better align with the new business plan, as follows:

Milestone 1 - Upon the execution by the Company of an agreement to lease or purchase land for (a) a geothermal well field, geothermal power plant or geothermal cooling/heating plant, (b) another type of clean energy power plant, or (c) pre- permitted construction-ready building sites for a data center or other facilities to be constructed pursuant to the Company's data center infrastructure platform.

Milestone 2 - Upon the Company receiving all required approvals from local, county and state agencies to allow the Company to proceed with the construction and development of an exploratory geothermal well, a geothermal power plant, a geothermal cooling/heating plant, or another type of clean energy power plant or for the Company's data center infrastructure platform.

Milestone 3 - Upon the execution by the Company (or by a partnership or joint venture to which the Company is a party) of an agreement pursuant to which a third party (a) will purchase power or heating/cooling, either as an off-taker of power or heating/cooling, (b) will purchase infrastructure under an Infrastructure-as-a- Service Agreement, (c) as a utility company, will purchase power or heating/cooling under a power or heating/cooling purchase agreement, or (d) through a partnership or joint venture agreement to which the Company is a party, will purchase power or heating/cooling the partnership or joint venture produces or for data center infrastructure that the partnership or joint venture provides to such third party.

Milestone 4 - Upon completion by the Company of construction of (a) a geothermal power plant, a geothermal heating/cooling plant, or other type of clean energy power plant, or (b) a data center infrastructure platform, and the receipt by the Company of all required operating permits from local, county or state officials for the operation of such plant or platform.

Milestone 5 - Upon the operation by the Company, either directly or indirectly, of a power plant, heating/cooling plant or other type of clean energy power plant, or an infrastructure platform, at an operating expense (OPEX) of 40% or less in any full fiscal year.

The outstanding performance-based awards at December 31, 2025 are as follows:

SCHEDULE OF OUTSTANDING PERFORMANCE-BASED AWARDS ACTIVITY

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | CEO | COO | VP- Senior Counsel | Total |
| Milestone 1 | 100000 | 350000 | 35000 | 485000 |
| Milestone 2 | 100000 | 350000 | 35000 | 485000 |
| Milestone 3 | 100000 | 350000 | 35000 | 485000 |
| Milestone 4 | 100000 | 350000 | 35000 | 485000 |
| Milestone 5 | 100000 | 350000 | 35000 | 485000 |
| Total | 500000 | 1750000 | 175000 | 2425000 |

---

The revised performance-based milestones were at the time of the modification directly linked to the execution of the Company's new business model at such time, most notably, the acquisition or leasing of land suitable for geothermal development. The identification of prospective locations has emphasized areas with sufficient geothermal activity, evidenced by the presence of other operational or in-development facilities in the same geographic regions. However, as of the date of the modification, the Company remained in an exploratory and negotiation stage and had not identified, nor entered into any definitive land lease or purchase agreements. Also, if the Company finds suitable land for the project, there can be no assurance that financing to lease or acquire the land will be available in sufficient amounts and on acceptable terms.

The Company evaluated the modification of the performance-based awards under ASC 718, Compensation – Stock Compensation and determined that the change represented a Type IV "improbable-to-improbable" modification. That is, both the original and new milestones were not considered probable of achievement at the time of modification. Because the Company is in the early stages of exploring and negotiating suitable land, and considering potential challenges such as regulatory delays, market competition, or failure to reach agreement with landowners, there remains substantial uncertainty regarding the achievement and timing of the new milestone; therefore:

● Original milestone: Not probable of achievement, as the related business objective was discontinued.

● New milestone: Also, not probable at the time of modification, as substantial uncertainty remained regarding the successful acquisition or leasing of suitable land.

As a result, consistent with ASC 718-20-55-108, no compensation expense related to these performance-based stock options has been recognized as of the modification date. The fair value of the modified awards is measured as of the modification date, but compensation cost will not be recognized until it becomes probable that the revised milestone will be satisfied.

The Company will continue to evaluate, at each reporting date, whether it has become probable that the new performance milestone will be achieved. Factors considered include, but are not limited to:

● Progress on negotiations for land acquisition or lease agreements.

● Developments in regulatory approvals or permitting for onsite power and geothermal projects.

● Changes in the competitive or market landscape for onsite power and geothermal sites.

Once management concludes that achieving the milestone has become probable, the Company will begin recognizing compensation cost for the modified options, reflecting the fair value at the modification date. If it becomes probable, the cumulative catch-up adjustment will be recognized in that period, and expense will be recognized prospectively over the vesting period for any remaining requisite service.

The following table summarizes the recapture of equity-based compensation as it pertains to each issuance and the breakdown between capitalized and expensed for the year ended December 31, 2025

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| | | | | |
|:---|:---|:---|:---|:---|
|  | | Q2 2025 - Project Abandonment | Q2 2025 - Project Abandonment | |
|  |<br>Total | Expensed | Capitalized |<br>Q1 2025 - Employee Terminations (Capitalized) |
| Vice President and Sr. Counsel (January 2025) | $54000 | $- | $54000 | $- |
| Consultant (November 2024) | 366000 |  | 366000 |  |
| Chief Strategy and Development officer (December 2023 | 987000 |  |  | 987000 |
| Date Center Development adviser (December 2023) | 88000 |  |  | 88000 |
| CEO and COO (December 2023) | 135000 | 135000 |  |  |
| CEO and COO (December 2023) | 225000 |  | 225000 |  |
| COO (June 2023) | 101000 | 101000 |  |  |
| COO (June 2023) | 302000 | - | 302000 | - |
| Totals | $2258000 | $236000 | $947000 | $1075000 |

---

During the year ended December 31, 2025, the Company recaptured approximately $2,258,000 of stock-based compensation expense, of which (i) $1,183,000 related to performance-based stock options with $947,000 classified as abandoned project cost and $236,000 classified as stock-based compensation expense, and (ii) $1,075,000 related to Q1 2025 terminated employees and classified as abandoned project cost.

For the year ended December 31, 2025, the total equity-based compensation expense was a net recapture of $1,515,000. The Abandoned project cost included an expense of $427,000 which was offset by the recapture of $2,022,000. The stock-based compensation expense was $316,000 offset by the recapture of $236,000 related to the performance-based stock options for a net expense of $80,000.

For the year ended December 31, 2024, the total equity-based compensation was approximately $2,749,000 of which approximately $2,380,000 was capitalized as Data Center Campus costs, and $369,000 was expensed.

In January 2025, the Company issued to the Vice President and Sr. counsel, Real Estate, Land Use and Governmental Affairs, a non-qualified stock option agreement for the purchase of 350,000 shares of the Company's common stock for an exercise price of $1.99 per share, which was the fair value of the Company's common stock on the grant date. The option vesting as to 350,000 shares of common stock as follows:

● The option becomes exercisable as to 43,750 shares of common stock on January 16, 2026 and shall vest and become exercisable as to an additional 43,750 shares of common stock on each of January 16, 2027, January 16, 2028, and January 16, 2029 provided that the optionee is a consultant, an employee or a Board member in good standing with the Company on such applicable vesting date.

● The option vests as to the remaining 175,000 shares of common stock based on the employee completing the modified milestones, as disclosed above.

The Company's management has accounted for the options in accordance with ASC 718, which requires the Company to estimate the service period over which the compensation cost will be recognized. Management has estimated that the first and second development phase (a) and (b) will be completed by December 31, 2025, the third development phase (c) by March 31, 2026, and the fourth and fifth development phases (d) and (e) by June 30, 2029. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.

The option grant date fair value of $690,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility range 223.09 to 237.39%, the fair value of common stock $1.99, estimated life range 4.5 to 5.25 years, risk-free rate of 4.45% and dividend rate of nil. For the nine months ended September 30, 2025, the Company recognized compensation expense of approximately $90,000 related to time-based equity awards, which was recorded as equity-based compensation. During the same period, the Company recorded a reversal of approximately $54,000 of performance-based compensation expense that had been capitalized in prior periods as data center campus costs. This amount was recorded as abandoned project costs, upon the determination that the related project would not be completed.

In November 2024, the Company issued to a consultant a non-qualified stock option to purchase 350,000 shares of the Company's common stock at an exercise price of $5.00 per share, the fair market value of the Company's common stock as of November 15, 2024 grant date. In May 2025, the Company terminated the contract with the consultant. As of the termination date, none of the stock options were vested. As a result, the stock option to purchase the 350,000 shares of the Company's common stock was forfeited and the associated compensation expense of approximately $366,000 was recaptured and classified as abandoned project costs.

In December 2023, the Company awarded an executive advisor a non-qualified stock option to purchase 350,000 shares of the Company's common stock. In April 2024, the Company hired the executive advisor to be its Chief Strategy and Development officer, at which time the Company issued a non-qualified stock option to purchase 1,000,000 shares of the Company's common stock. In January 2025, the Company terminated the employment agreement. As of the termination date, the employee vested 168,750 time-based options to purchase shares of common stock, the remaining 1,181,250 options to purchase common stock was cancelled and the estimated compensation expense capitalized in the prior year of approximately $987,000 was recaptured as a reduction in abandoned project cost.

In December 2023, the Company awarded its Data Center Development advisor a non-qualified stock option to purchase 350,000 shares of the Company's common stock. In February 2025, the Company terminated the employment agreement. As of the termination date, the employee vested 43,750 time-based options to purchase shares of common, the remaining 306,250 options to purchase common stock was cancelled and the estimated compensation expense capitalized in the prior year of approximately $88,000 was recaptured, as a reduction of abandoned in abandoned project cost.

In December 2023, the Board of Directors approved the issuance of stock options to the Company's CEO and COO for the purchase of 1,000,000 shares of common stock with an exercise price of $0.54, per share, which was the fair market value of the Company's common stock on the date of issuance. For the year ended December 31, 2025, the Company recognized compensation expense of approximately $71,000 related to time-based equity awards, and upon the determination that the related project would not be completed recorded a reversal of approximately $135,000 for performance-based awards, both of which were recorded as equity-based compensation. During the same period, the Company recorded a reversal of approximately $225,000 of performance-based compensation expense that had been capitalized in prior periods as data center campus costs. The $225,000 was recorded to abandoned project costs, upon the determination that the related project would not be completed.

In June 2023, the Board of Directors approved the issuance of stock options to the Company's COO for the purchase of 1,000,000 shares of common stock with an exercise price of $0.54, per share, which was the fair market value of the Company's common stock on the date of issuance. In June 2023, as part of an employment agreement an executive was granted an incentive stock option and a non-qualified stock option to purchase 600,000 and 1,900,000, respectively, shares of the Company's common stock for $0.50 per share. The stock options are exercisable for a period of seven years from the date of grant, which was June 19, 2023. For the year ended December 31, 2025, the Company recognized compensation expense of approximately $49,000 related to time-based equity awards, and upon the determination that the related project would not be completed recorded a reversal of approximately $101,000 for performance-based awards, both of which were recorded as equity-based compensation. During the same period, the Company recorded a reversal of approximately $302,000 of performance-based compensation expense that had been capitalized in prior periods as data center campus costs. The $302,000 was recorded to abandoned project costs, upon the determination that the related project would not be completed.

*Warrants – related parties*

The following table summarized warrants outstanding as of December 31, 2025:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of**<br> **Shares** | **Weighted**<br> **Average**<br> **Strike**<br> **Price/Share** | **Weighted**<br> **Average**<br> **Remaining**<br> **Contractual**<br> **Term**<br> **(Years)** | **Weighted**<br> **Average**<br> **Grant Date**<br> **Fair**<br> **Value/Share** | <br>**Intrinsic**<br> **Value** |
| Balance, December 31, 2023 | 5645801 | $1.84 | 3.0 | $1.49 | $0.20 |
| Granted | 3058877 | 2.23 | 4.8 | 2.08 |  |
| Forfeited | (600000) | 3.65 | 4.5 | 3.00 |  |
| Exercised |  |  |  |  |  |
| Expired | (100000) | 1.87 | - | 1.95 |  |
| Balance, December 31, 2024 | 8004678 | 0.95 | 4.3 | 0.83 | 0.62 |
| Granted | 3500000 | 0.50 | 5.15 | 0.35 |  |
| Forfeited |  |  |  |  |  |
| Exercised |  |  |  |  |  |
| Expired | - | - | - | - | - |
| Balance, December 31, 2025 | 11504678 | 0.81 | 3.84 | 0.68 | - |
| Vested and exercisable, December 31, 2025 | 11504678 | 0.81 | 3.84 | 0.68 | - |
| Unvested, December 31, 2025 | – | $– | – | $– | $– |

---

Of the total warrant of 11,504,678, SFO holds 7,958,877 and M1 Advisors LLC, an entity controlled by Michael Campbell a Company shareholder and board member, holds 3,545,801.

NOTE 7 – INCOME TAXES

For the years ended December 31, 2025 and 2024, the Company generated a current income tax provision of nil. Additionally, no deferred income taxes have been recorded due to the uncertainty of the realization of any tax assets. On December 31, 2025, the Company has net operating loss ("NOL") carryforwards for Federal income tax purpose of $14,649,000 and for state income tax purpose of $14,639,000 that may be offset against future taxable income. For federal purposes, there is an unlimited carryforward period, and for state purposes, the net operating losses begin to expire in 2038 if not utilized by then.

The income tax (benefit)/expense attributable to loss consisted of the following for the year ended December 31,:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Current provision for income taxes: |  |  |
| Federal | $- | $- |
| State | - | - |
| &nbsp;&nbsp;&nbsp;Total current income tax | - | - |
| Deferred tax expense: |  |  |
| Federal |  |  |
| State | - | - |
| &nbsp;&nbsp;&nbsp;Total deferred tax | - | - |
| Total income tax | $- | $- |

---

A reconciliation of the federal statutory income tax rate to the Company's effective income tax rate is as follows:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Taxes calculated at federal rate | 21.0% | 21.0% |
| Permanent differences | (5.0) | (18.0) |
| State tax, net of federal impact |  |  |
| Return to provision | 6.8 |  |
| Other | 7.8 | 1 |
| Change in valuation allowance | (30.6) | (4.0) |
| Provision for income taxes | 0% | 0% |

---

Presented below are the tax effects of temporary differences that give rise to significant portions of the deferred tax assets at December 31,:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Deferred tax assets |  |  |
| &nbsp;&nbsp;&nbsp;Net operating loss carryforwards | $4099000 | $2089000 |
| &nbsp;&nbsp;&nbsp;Stock based compensation | 453000 | 439000 |
| &nbsp;&nbsp;&nbsp;Intangible assets |  | 1000 |
| &nbsp;&nbsp;&nbsp;Impairment loss |  | 37000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total deferred tax assets | 4552000 | 2566000 |
| Deferred tax liability |  |  |
|  | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total deferred tax liability | - | - |
| Net deferred tax assets | 4552000 | 2566000 |
| Valuation allowance | (4552000) | (2566000) |
| Net deferred tax | $— | $— |

---

Deferred tax assets and liabilities are computed by applying the federal and state income tax rates in effect to the gross amounts of temporary differences and other tax attributes, such as net operating loss carryforwards. In assessing if the deferred tax assets will be realized, the Company considers whether it is more likely than not that some or all of these deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which these deductible temporary differences reverse.

For financial reporting purposes, the Company has incurred a loss in each period since its inception. Based on all available evidence, including the Company's history of losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets on December 31, 2025, and 2024. During the years ended December 31, 2025, and 2024, the valuation allowance increased (decreased) by $1,986,000 and $413,000, respectively. The increase was mostly attributable to the increase in our net operating loss carryforwards. The total valuation allowance results from the Company's estimate of its inability to recover its net deferred tax assets.

The Company files income tax returns in the United States and the state of California. The statute of limitation is three and four years for Federal and California purposes, respectively. The first year that remains open is the tax year ended December 31, 2022 and December 31, 2021 for Federal and California, respectively. As of December 31, 2025 and 2024, there are no unrecognized tax benefits, and there are no significant accruals for interest related to unrecognized tax benefits or tax penalties.

The Company is in the process of analyzing its NOL and has not determined if the company has had any change of control issues that could limit the future use of NOL. The NOL carryforwards that were generated after 2017 of approximately $14,649,000 may only be used to offset 80% of future taxable income and are carried forward indefinitely.

Note 8 – Subsequent Events

The Company evaluated all events that occurred after the balance sheet date through the date the financial statements were issued to determine if they must be reported. The management determined there are no reportable events.

Personnel Changes

Michael Campbell became our Senior Vice President, Corporate Development on March 27, 2026. Previously, he had been our Chief Executive Officer since September 12, 2018, a position from which he resigned on March 27, 2026 because of health issues

On March 27, 2026, the Company into an Employment Agreement dated as of March 27, 2026 (the "Employment Agreement") with Joel D. Stone, to serve as our Chairman and Chief Executive Officer. Prior to entering in the Employment Agreement, Mr. Stone had been our President and Chief Operating Officer. Pursuant to the terms of the Employment Agreement, Mr. Stone will receive (i) an annual base salary of $300,000, which amount may be increased upon our reaching certain benchmarks described in the Employment Agreement, as determined in our sole discretion; (ii) an additional option grant of seven-year fully-vested options to purchase 2,000,000 shares of our common stock for a purchase price of $0.49 per share, and (iii) the right to participate in all benefit plans offered to our senior executive officers.

## Exhibit 10.3

**Exhibit 10.3**

**EXECUTIVE EMPLOYMENT AGREEMENT**

**Chairman and Chief Executive Officer**

This Executive Employment Agreement ("Agreement") is made and entered into on March 27, 2026, by and between CalEthos, Inc., with principal offices located at 11753 Willard Avenue, Tustin, CA 92782 ("CalEthos," "Employer," or the "Company") and Joel D. Stone ("Executive"). Employer and Executive shall be referred to individually as a "Party" and collectively as the "Parties."

WHEREAS, Executive is currently employed by the Company in the capacities of President and Chief Operating Officer of the Company; and

WHEREAS the Company's Board of Directors desires to continue the employment of Executive in the capacities of Chairman and Chief Executive Officer of the Company and Executive desires to be employed by Employer in such capacities.

WHEREAS, Executive's new role will commence on the date of this Agreement, and this Agreement will memorialize the terms and conditions of Executive's employment as Chairman and Chief Executive Officer of the Company.

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Parties agree as follows:

1. <u>Duties and Responsibilities</u>

Executive shall be employed as Chairman and Chief Executive Officer ("CEO"), a full-time exempt position, and will report to the Board of Directors ("BOD"). Executive's duties shall be those duties reasonably expected to be performed by a person with the title of Chairman and CEO of a data center development and operations company, including, but not limited to, those duties outlined in the attached job description, and such duties and responsibilities as the BOD may assign to Executive from time to time.

Executive acknowledges and agrees that he is being offered a position of employment by the Company with the understanding that Executive possesses a unique set of skills, abilities, and experiences which will benefit the Company, and he agrees that his continued employment with the Company is contingent upon his successful performance of his duties in his position, or in such other position to which he may be assigned.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. General Duties

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Executive
 shall render to the very best of Executive's ability, on behalf of the Company, services
 to and on behalf of the Company, and shall undertake diligently all duties assigned to him
 by the Company.

ii. Executive
 shall devote his full time, energy and skills to the performance of services for the Company
 at such time and place as the Company may direct. Executive shall not undertake, either as
 an owner, director, shareholder, employee or otherwise, the performance of services for compensation
 (actual or expected) for any other entity without the express written consent of the BOD.

Joel Stone Employment Agreement

March 30, 2026

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. Executive
 shall faithfully and industriously assume and perform with skill, care, diligence and attention
 all responsibilities and duties connected with his employment on behalf of the Company.

iv. Executive
 shall have no authority to enter into any contract that materially affects the Company or
 to deliberately create any material obligation outside of normal business operations on the
 part of the Company, except as may be specifically authorized by the BOD. For purposes of
 this section, "materially" or "material" shall be defined as any
 contract that has a financial impact or is financially binding upon the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Specific Duties

Please see the attached Job Description.

2. <u>Compensation</u>

In consideration for Executive's agreement to perform his duties as Chairman and CEO, Employer agrees as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. ***Base Salary***: Employer will pay Executive a base salary of $300,000.00 per annum, less applicable withholding taxes, paid in equal installments twice a month ("Base Salary"), commencing upon the Company completing its planned financing of $15,000,000 in April of 2026. Executive will be paid in accordance with Employer's regular payroll practices. Direct deposit may be available should Executive desire.

As more fully set forth in the Job Description, once certain benchmarks are reached, and so long as they are reached in a timely manner, Executive's Base Salary will be reviewed and revised with the BOD. Whether Executive has met the benchmarks required to increase the Base Salary will be determined at the sole discretion of the BOD.

**The Base Salary is stated in annual terms for the sake of convenience and is not intended to, nor does it, create an employment contract for any specific period of time.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. ***Bonus***: At the sole discretion of the BOD, following each calendar year of continuous employment, Executive shall be eligible to receive a discretionary bonus (a "Bonus"). Payment of any Bonus will be based on the achievement of certain goals and performance criteria established by BOD ("Performance Goals"). The determination of whether Executive has met the Performance Goals for any given year, and if so, the amount of any Bonus that will be paid for such year (if any), shall be determined by BOD in its sole and absolute discretion. In order to be eligible to earn or receive any Bonus, Executive must remain employed by Employer through and including the end of the year with respect to which such Bonus is earned. Executive acknowledges that payment of a Bonus, if any, is at the sole discretion of the BOD. Nothing in this paragraph is intended to or shall alter Executive's at-will employment status.

Joel Stone Employment Agreement

March 30, 2026

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. ***Severance***: if Executive is terminated without Cause (defined below) or resigns for Good Reason (defined below) and Executive has signed and not revoked a general release, the Company will pay Executive Severance as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. If
 Executive is terminated without Cause or resigns with Good Reason after one year of employment,
 and Executive has executed and not revoked a general release, Executive will be entitled
 payment of six (6) months of Base Salary as severance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. As
 a condition precedent to the Company's obligation to pay severance, Executive must
 execute, deliver, and not revoke a separation agreement with a general release ("Separation
 Agreement") within 30 days of Executive's last day of employment. If Executive
 fails to execute and deliver the Separation Agreement, or if Executive effectively revokes
 the release, the Company shall be under no obligation to pay any severance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. For
 purposes of this Agreement, "Cause" means: (a) failure to perform the duties
 of the Executive's position in a satisfactory manner; (b) fraud, misappropriation,
 embezzlement or acts of similar dishonesty; (c) conviction of a felony involving moral turpitude;
 (d) illegal use of drugs or excessive use of alcohol in the workplace; (e) intentional and
 willful misconduct that may subject the Company to criminal or civil liability; (f) breach
 of the Executive's duty of loyalty, including the diversion or usurpation of corporate
 opportunities properly belonging to the Company; (g) willful disregard of Company policies
 and procedures; (h) breach of any of the material terms of this Agreement; and (i) gross
 misconduct, insubordination or deliberate refusal to follow the instructions of the CEO or
 Board. For subsections (a) and (h) only, the Company will provide written notice to Executive
 that it believes Executive has violated one or both of these subsections and Executive shall
 have thirty (30) days from the date of such notice to substantially or materially cure such
 circumstances. If after this 30-day cure period, the Company determines that the Executive
 has failed to cure the performance deficiencies or breach, the Company may terminate Executive's
 employment with Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. For
 purposes of this Agreement, "Good Reason" means: (i) a material reduction in
 Executive's Base Annual Salary, other than any reduction that applies proportionally
 to similarly situated executives; or (ii) a material change or reduction in Executive's
 job duties or reporting structure, provided, however, that to establish Good Reason, (A)
 the Executive must first provide the Company written notice of any of the foregoing within
 a reasonable period of time following the commencement of such event specifying the basis
 for Executive's belief that Executive is entitled to terminate Executive's employment
 for Good Reason, and (B) the Company must have thirty (30) days to cure such event.

Joel Stone Employment Agreement

March 30, 2026

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;***D. Employee Stock Options***: Subject to Board approval and the standard terms applicable to the Company's Employee Stock Option Plan, and subject to stockholder approval of the increase in the Company's Employee Stock Option Plan to 10,000,000 shares, Executive will be granted a fully-vested option to acquire Two Million (2,000,000) shares of the Company's common stock at $0.49 per share.

 ****

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Previously
 granted Stock Options will vest as defined in Stock Option Agreements already in place between
 Executive and the Company.

ii. Upon
 a Change of Control event whereby the Company is sold or acquired, any outstanding Stock
 Options that are not fully vested shall be accelerated so that they become fully vested.
 For purposes of this Agreement, a "Change in Control" means the acquisition of
 the Company by another entity by sale of stock, consolidation, merger, or other reorganization
 of the Company, or any sale, lease, irrevocable license or other disposition of substantially
 all of the Company's assets unless the holders of the Company's voting securities
 immediately before the transaction hold at least fifty percent (50%) of the total voting
 power of the survivor or successor entity immediately after the transaction in the same relative
 proportions as before the transaction.

3. <u>Telecommuting and Expense Reimbursement</u>

Based on the mutual agreement of the Parties, Executive may perform his duties remotely. Executive must satisfactorily perform all duties and responsibilities that he would otherwise be required to perform if Executive was working at Employer's worksite. Nothing in this Agreement will prevent the Company from requiring Executive's presence at the worksite as required by, and in the sole discretion of, the Employer. CalEthos may discontinue the telecommuting arrangement at any time.

If needed, Employer will provide Executive with a computer/laptop, monitor(s), headsets, camera, printer, office supplies, or any other materials or equipment that Executive may need to perform his job duties. Executive agrees that all technology equipment provided to Executive by Employer is the property of Employer and shall immediately return the equipment to Employer at any time upon request or upon termination of Executive's employment.

Executive may use his own computer/laptop, office equipment and cellphone, provided that any and all data and files created during the course of business are stored on Company-approved data storage, file systems and or collaboration tools. All Company data and files must be secured and access password protected. Executive must take all steps necessary to ensure the confidentiality of the information maintained on these systems. Executive should have no expectation of privacy as to any data maintained on the Company's systems.

If at any time Executive believes that the monthly stipend does not cover all expenses incurred by Executive in working remotely, Executive must immediately advise the BOD of the same.

The Company will reimburse the Executive for any additional, documented and reasonable business expenses, subject to such guidelines or limitations provided by the Company from time to time under its employee travel policies.

Joel Stone Employment Agreement

March 30, 2026

4. <u>Benefits</u>

Executive shall be eligible to participate in all employee benefit plans, policies and programs in which other Company executive or officers participate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. ***Paid Sick Leave***: CalEthos will provide Executive a one-time lump-sum allocation of 48 hours of Paid Sick Leave. Thereafter, Executive will receive a new allocation of 48 hours either on the first of the calendar year, or on the anniversary of hire. Unused Paid Sick Leave will carry over to the following year up to a maximum of 72 hours of Paid Sick Leave. Executive may use Paid Sick Leave beginning on the 90th day of employment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. ***Vacation***: After 90 days of continuous and active employment, CalEthos will provide Executive with twenty (20) days or 160 hours of vacation per annum, which will accrue on a pro rata basis of 13.33 hours for each full month worked. During the first year of employment, Executive will accrue only 15 days or 120 hours, as Executive will not accrue any vacation during the first 90 days of employment. Accrued but unused vacation will carry over from year to year up to a maximum of 30 days or 240 hours, at which time no more vacation will accrue until Executive uses some of the accrued but unused vacation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. ***Insurance***: The Company will pay up to Two Thousand Three Hundred Dollars ($2,300) per month for Executive and his immediate family's (spouse and dependent children) health insurance.

CalEthos reserves the right to change its benefits at any time.

5. <u>Employment At Will</u>

Executive's employment is "at will." This means that either Executive or CalEthos can terminate this employment at any time, for any reason, with or without cause and with or without notice. This paragraph is the complete and exclusive statement regarding the circumstances under which Executive's employment may be terminated. It supersedes any prior agreement or representation. If any term of this paragraph conflicts with any policy of CalEthos, now or in the future, the terms of this paragraph will control. The terms of this paragraph may not be changed except by written agreement signed by Executive and the CEO of CalEthos.

6. <u>Confidentiality</u>

During performance of his duties and obligations under this Agreement, Executive will become privileged to certain information that is classified as "Confidential Information," which includes information relating to CalEthos and/or its clients, including but not limited to the identity of CalEthos' clients, employees, vendors, contractors, CalEthos' finances, the finances and personal affairs of the CEO, activities, software, processes, systems, applications, marketing strategies or plans, and any other information that is non-public, proprietary or confidential in nature (all the foregoing, collectively, "Confidential Information"). The protection of confidential information is vital. Executive shall (i) keep all Confidential Information confidential; (ii) not disclose any Confidential Information or any part thereof, in any manner whatsoever, without CalEthos' prior written consent, and (iii) not use any Confidential Information or any part thereof, including but not limited to soliciting clients post-employment as outlined in the NDA/Confidentiality Agreement signed between the Parties on 3/27/2023.

Joel Stone Employment Agreement

March 30, 2026

All Confidential Information is and remains the property of CalEthos and cannot be used, disclosed, duplicated or redistributed in any way at any time. Executive is prohibited from either disclosing, misusing, or misappropriating any Confidential Information at any time, either during employment *or thereafter*, except as required in the course of employment. Executive is specifically prohibited from disclosing such Confidential Information to CalEthos' competitors and any subsequent employers.

Confidential Information shall not include any records, data or information which are in the public domain, provided the same are not in the public domain as a consequence of disclosure directly or indirectly by Executive in violation of this provision.

7. <u>Loyalty; Noncompetition; Nonsolicitation; Nondisparagement</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.  ***Loyalty*** .
 Executive shall devote his best efforts to such duties as are assigned by CalEthos and shall
 comply with all policies and instructions promulgated by CalEthos. Executive agrees not to
 acquire, assume or participate in, directly or indirectly, any position, investment or interest
 known by Executive to be adverse or antagonistic to CalEthos, its business, or prospects,
 financial or otherwise, or in any company, person, or entity that is, directly or indirectly,
 in competition with the business of CalEthos.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.  ***Noncompetition*** .
 During Executive's employment, Executive shall not, without the prior written consent
 of CalEthos, engage in competition with CalEthos, either directly or indirectly in any manner
 or capacity, as adviser, principal, agent, affiliate, promoter, partner, officer, director,
 employee, stockholder, owner, co-owner, consultant, or otherwise, in any phase of the business
 of researching, developing, manufacturing, or marketing of products or services which are
 in the same field of use or which otherwise compete with the products or services or proposed
 products or services of CalEthos.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.  ***Nonsolicitation*** .
 During Executive's employment, and for 12 months thereafter, Executive shall not: (i)
 solicit or induce, or attempt to solicit or induce, any individual who is an employee or
 consultant of CalEthos, to terminate his or her employment or consulting relationship with
 CalEthos; or (ii) use CalEthos' Confidential Information (described above) to solicit
 or attempt to solicit the business of any person or entity who is doing, or has within the
 last six months done, business with CalEthos for the purpose of engaging in competition with
 CalEthos.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.  ***Nondisparagement*** .
 At all times during Executive's employment and thereafter, Executive agrees not to
 disparage CalEthos, or its respective owners, officers, directors, employees, shareholders,
 or agents, in any manner likely to be harmful to its or their businesses, business reputations,
 or personal reputations, provided that Executive will respond accurately and fully to any
 question, inquiry or request for information when required by legal process. Nothing in this
 Agreement shall be construed as limiting an employee's right to engage in concerted
 activity protected by Section 7 of the National Labor Relations Act, filing an unfair labor
 practice charge, or assisting or cooperating with a National Labor Relations Board investigation.

Joel Stone Employment Agreement

March 30, 2026

8. <u>General</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. <u>Entire Agreement</u>. This Agreement supersedes any and all other agreements, either oral or in writing, between the Parties except for the Arbitration Agreement and Confidentiality and Non-Disclosure Agreement, both dated March 27, 2023, and the attached Job Description, which are expressly incorporated herein by reference.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. <u>Amendment</u>. This Agreement may not be modified, altered, or changed except upon express written consent of both Parties wherein specific reference is made to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** <u>No Reliance on Representation of the Other</u>. Each Party to this Agreement acknowledges that no representation, inducements, promises, or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement, statement, or promise not contained in this Agreement shall be valid or binding on either party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**C.** <u>Partial Invalidity</u>. If any provision in this Agreement is held by a court of competent jurisdiction or arbitrator to be invalid, void, or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**D.** <u>Law Governing the Agreement</u>. This Agreement shall be governed by and construed in accordance with the laws of the State of California.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**E.** <u>Headings</u>. The headings in this Agreement are to make it easier to read and should not be considered when interpreting various provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**F.** <u>Successors</u>. The rights and obligations of the Parties hereunder are not assignable to another person without prior written consent; provided, however, that the Company, without obtaining Executive's consent, may assign its rights and obligations hereunder to a wholly-owned subsidiary and provided further that any post-employment restrictions shall be assignable by the Company to any entity which purchases all or substantially all of the Company's assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**G.** <u>No Assignment</u>. This Agreement is solely between Executive and Employer and cannot be assigned by Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**H.** <u>Attorneys' Fees</u>. Should any litigation (or arbitration) be commenced between or among Employer and Executive concerning this Agreement or the rights and duties of the Parties in relation hereto, the party prevailing in such litigation (or arbitration) shall be entitled, in addition to such other relief as may be granted, to a reasonable sum for its attorneys' fees and costs in such litigation (or arbitration), which shall be determined by the court (or arbitrator) in such litigation (or arbitration) or in a separate action brought for that purpose.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**I.** <u>Proper Construction</u>. The language of all parts of this Agreement shall in all cases be construed as a whole according to its fair meaning, and not strictly for or against any of the Parties. As used in this Agreement, the term "or" shall be deemed to include the term "and/or," and the singular or plural shall be deemed to include the other whenever the context so indicates or requires.

Joel Stone Employment Agreement

March 30, 2026

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**J.** <u>Representation by Counsel</u>. The Parties acknowledge and agree that they have had the opportunity to be represented by counsel and that both Parties have participated in the drafting of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;K. <u>Delay Does Not Constitute a Waiver</u>. No delay or omission by a party in exercising any right under this Agreement will operate as a waiver of that or any other right. A waiver or consent given by either party on any one occasion is effective only in that instance and will not be construed as a bar to or waiver of any right on any other occasion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;L. <u>Counterpart and Facsimile</u>. This Agreement may be signed in separate counterparts, with each counterpart having the full force and effect of an original. Any signature to this Agreement shall be deemed an original signature even if the signature is transmitted by facsimile or is an electronic/digital signature. Any electronic signature must be captured using secure software, such as DocuSign, Adobe Sign, or HelloSign.

IN WITNESS WHEREOF, THE PARTIES HERETO HAVE EXECUTED THIS AGREEMENT AS OF THE DATE SET FORTH BELOW.

---

| | | | |
|:---|:---|:---|:---|
| CALETHOS, INC. | CALETHOS, INC. | EXECUTIVE | EXECUTIVE |
| Signature: | */s/ Michael Campbell* | Signature: | */s/ Joel Stone* |
| Print: | Michael Campbell | Print: | Joel Stone |
| Title: | Senior Vice President | Title: | Chairman and CEO |
| Date: | March 27, 2026 | Date: | March 27, 2026 |

---

Joel Stone Employment Agreement

March 30, 2026

**<u>Exhibit A</u>**

**<u>JOB DESCRIPTION</u>**

The Chairman and Chief Executive Officer ("CEO") is the member of executive management and responsible for maintaining and driving operational results of CalEthos, Inc. ("CalEthos") The CEO works closely with the BOD as well as other executive management team members. As one of the most critical and essential positions within a company, the CEO must be a skilled communicator, effective leader and driven businessperson who can spur company growth, maintain key operational procedures, create new processes and ensure day-to-day operational excellence.

**Responsibilities**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Provide
 management to staff and leadership to CalEthos that aligns with the Company's business
 plan and overall strategic vision.

2. Oversee
 all phases of the Data Center Project, including Design and Planning Phase, the Development/Construction
 Phase and Operations Phase.

3. Assist
 executive team members in creating, growing and building a world class, industry leading
 company.

4. Drive
 company results from both an operational and financial perspective working closely with the
 BOD and other key executive team members.

5. Partner
 with executive team members to achieve favorable financial results with respect to sales,
 profitability, cash flow, mergers and acquisitions, systems, reporting and controls.

6. Set
 challenging and realistic goals for growth, performance and profitability.

7. Create
 effective measurement tools to gauge the efficiency and effectiveness of internal and external
 processes.

8. Provide
 accurate and timely reports outlining the operational condition of the company.

9. Spearhead
 the development, communication and implementation of effective growth strategies and processes.

10. Work
 with other C-level executives on budgeting, forecasting and resource allocation programs.

11. Work
 closely with senior management team to create, implement and roll out plans for operational
 processes, internal infrastructures, reporting systems and CalEthos' policies all designed
 to foster growth, profitably and efficiencies within the company.

12. Motivate
 and encourage employees at all levels as one of the key leaders in the company including
 but not limited to professional staff, management level employees and executive leadership
 team members.

13. Forge
 strategic partnerships and relationships with clients, vendors, banks, investors and all
 other professional business relationships.

14. Foster
 a growth oriented, positive and encouraging environment while keeping employees and management
 accountable to company policies, procedures and guidelines.

## Exhibit 10.7

**Exhibit 10.7**

**WARRANT**

**THE WARRANT REPRESENTED BY THIS CERTIFICATE AND THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS IN RELIANCE ON EXEMPTIONS FROM REGISTRATION REQUIREMENTS UNDER SAID LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.**

**THE TRANSFER OF THIS WARRANT IS**

**R** **ESTRICTED AS DESCRIBED HEREIN.**

**CALETHOS INC.**

<u>Warrant for the Purchase of up to</u>

<u>500,000 Shares of Common Stock, par value $0.001 per share</u>

---

| | |
|:---|:---|
| **No. WA<u> </u>** | **500,000 Shares** |
| **Issue Date:** April 22, 2025 |  |

---

THIS CERTIFIES that, for value received, SFO IDF LLC, a limited liability company with an address at 787 N. Palm Canyon Drive, Palm Springs, CA 92262 (including any transferee, the "<u>Holder</u>"), is entitled to subscribe for and purchase from CalEthos Inc., a Nevada corporation (the "<u>Company</u>"), upon the terms and conditions set forth herein, at any time or from time to time before 5:00 P.M., New York time, on August 31, 2030 (the "<u>Exercise Period</u>"), up to Five Hundred Thousand (500,000) shares of Common Stock, par value $0.001 per share (the "<u>Common Stock</u>"), at an initial exercise price per share of $0.49, subject to adjustment pursuant to the terms hereof (the "<u>Exercise Price</u>"). As used herein, the term "this Warrant" shall mean and include this Warrant and any Warrant or Warrants hereafter issued as a consequence of the exercise or transfer of this Warrant in whole or in part.

The number of shares of Common Stock issuable upon exercise of this Warrant (the "<u>Warrant Shares</u>") and the Exercise Price may be adjusted from time to time as hereinafter set forth.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. (a) This Warrant may be exercised during the Exercise Period as to all or a lesser number of whole Warrant Shares by the surrender of this Warrant (with the Exercise Form attached hereto duly executed) to the Company at its principal executive office, which is located on the date hereof at 11753 Willard Avenue, Tustin, CA 92782, Attention: Chief Financial Officer, or at such other place as is designated in writing by the Company, together with cash, a certified or bank cashier's check or wire transfer of immediately available funds payable to the order of the Company in an amount equal to the Exercise Price multiplied by the number of Warrant Shares for which this Warrant is being exercised.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Warrant may also be exercised by the Holder through a cashless exercise, as described in this Section 1(b). This Warrant may be exercised, in whole or in part, by (i) the delivery to the Company of a duly executed Exercise Form specifying the number of Warrant Shares to be applied to such exercise, and (ii) the surrender to a common carrier for overnight delivery to the Company, or as soon as practicable following the date the Holder delivers the Exercise Form to the Company, of this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction). The number of shares of Common Stock to be issued upon exercise of this Warrant pursuant to this Section 1(b) shall equal the value of this Warrant (or the portion thereof being canceled) computed as of the date of delivery of this Warrant to the Company using the following formula:

where:

---

| | |
|:---|:---|
| X = | <u>Y(A-B)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;A |
| X = | the number of shares of Common Stock to be issued to the Holder under this Section 1(b); |
| Y = | the number of Warrant Shares identified in the Exercise Form as being applied to the subject exercise; |
| A = | the Current Market Price on such date; and |
| B = | the Exercise Price on such date |

---

For purposes of this Section 1(b), the "<u>Current Market Price</u>" per share of Common Stock on any day shall mean: (i) if the principal trading market for such securities is a national or regional securities exchange, the closing price on such exchange on such day; or (ii) if (i) above is not applicable, and if bid and ask prices for shares of Common Stock are reported in the over-the-counter market of the OTC Markets Group, Inc., the average of the high bid and low ask prices so reported on such day. Notwithstanding the foregoing, if there is no reported closing price or bid and ask prices, as the case may be, for the day in question, then the Current Market Price shall be determined as of the latest date prior to such day for which such closing price or bid and ask prices, as the case may be, are available, unless such securities have not been traded on an exchange or in the over-the-counter market for 30 or more days immediately prior to the day in question, in which case the Current Market Price shall be determined in good faith by, and reflected in a formal resolution of, the Board of Directors of the Company.

The Company acknowledges and agrees that this Warrant was issued on the Issue Date set forth on the face of this Warrant (the "<u>Issuance Date</u>"). Consequently, the Company acknowledges and agrees that, if the Holder conducts a cashless exercise pursuant to this Section 1(b), the period during which the Holder held this Warrant may, for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "<u>Act</u>"), be "tacked" to the period during which the Holder holds the Warrant Shares received upon such cashless exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Upon each exercise of the Holder's rights to purchase Warrant Shares, the Holder shall be deemed to be the holder of record of the Warrant Shares issuable upon such exercise, notwithstanding that the transfer books of the Company shall then be closed or certificates representing such Warrant Shares shall not then have been actually delivered to the Holder. As soon as practicable after each such exercise of this Warrant, the Company shall issue and deliver to the Holder a certificate or certificates for the Warrant Shares issuable upon such exercise, registered in the name of the Holder or its designee. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute and deliver a new Warrant evidencing the right of the Holder to purchase the balance of the Warrant Shares (or portions thereof) subject to purchase hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. (a) Any Warrants issued upon the registration of transfer or exercise in part of this Warrant shall be numbered and shall be registered in a Warrant Register as they are issued. The Company shall be entitled to treat the registered holder of any Warrant on the Warrant Register as the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to or interest in such Warrant on the part of any other person, and shall not be liable for any registration or transfer of Warrants which are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary unless made with the actual knowledge that a fiduciary or nominee is committing a breach of trust in requesting such registration or transfer, or with the knowledge of such facts that its participation therein amounts to bad faith. The transfer of this Warrant may be registered on the books of the Company upon delivery thereof duly endorsed by the Holder or by his duly authorized attorney or representative, or accompanied by proper evidence of succession, assignment or authority to transfer. In all cases of transfer by an attorney, executor, administrator, guardian or other legal representative, due authority shall be produced. Upon any registration of transfer, the Company shall deliver a new Warrant or Warrants to the person entitled thereto. This Warrant may be exchanged, at the option of the Holder thereof, for another Warrant, or other Warrants of different denominations, of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares (or portions thereof), upon surrender to the Company or its duly authorized agent. Notwithstanding the foregoing, the Company may require prior to registering any transfer of a Warrant an opinion of counsel reasonably satisfactory to the Company that such transfer complies with the provisions of the Act, and the rules and regulations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Holder acknowledges that he has been advised by the Company that neither this Warrant nor the Warrant Shares have been registered under the Act, that this Warrant is being or has been issued and the Warrant Shares may be issued on the basis of the statutory exemption provided by Section 4(2) of the Act or Rule 506 of Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering, and that the Company's reliance thereon is based in part upon the representations made by the original Holder in the Subscription Agreements. The Holder acknowledges that he has been informed by the Company of, or is otherwise familiar with, the nature of the limitations imposed by the Act and the rules and regulations thereunder on the transfer of securities. In particular, the Holder agrees that no sale, assignment or transfer of this Warrant or the Warrant Shares issuable upon exercise hereof shall be valid or effective, and the Company shall not be required to give any effect to any such sale, assignment or transfer, unless (i) the sale, assignment or transfer of this Warrant or such Warrant Shares is registered under the Act, it being understood that neither this Warrant nor such Warrant Shares are currently registered for sale and that the Company has no obligation or intention to so register this Warrant or such Warrant Shares except as specifically provided for in the Registration Rights Agreement (as defined or described in the Subscription Agreement), or (ii) this Warrant or such Warrant Shares are sold, assigned or transferred in accordance with all the requirements and limitations of Rule 144 under the Act, it being understood that Rule 144 is not available at the time of the original issuance of this Warrant for the sale of this Warrant or such Warrant Shares and that there can be no assurance that Rule 144 sales will be available at any subsequent time, or (iii) such sale, assignment, or transfer is otherwise exempt from registration under the Act in the opinion of counsel reasonably acceptable to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Company shall at all times reserve and keep available out its authorized and unissued Common Stock, solely for the purpose of providing for the exercise of the rights to purchase all Warrant Shares granted pursuant to the Warrants, such number of shares of Common Stock as shall, from time to time, be sufficient therefor. The Company covenants that all shares of Common Stock issuable upon exercise of this Warrant, upon receipt by the Company of the full Exercise Price therefor, shall be validly issued, fully paid, nonassessable, and free of preemptive rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. (a) In case the Company shall at any time after the date the Warrants were first issued (i) declare a dividend on the outstanding Common Stock payable in shares of its capital stock, (ii) subdivide the outstanding Common Stock, (iii) combine the outstanding Common Stock into a smaller number of shares, or (iv) issue any shares of its capital stock by reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), then, in each case, the Exercise Price, and the number of Warrant Shares issuable upon exercise of this Warrant, in effect at the time of the record date for such dividend or of the effective date of such subdivision, combination or reclassification, shall be proportionately adjusted so that the Holder after such time shall be entitled to receive the aggregate number and kind of shares which, if such Warrant had been exercised immediately prior to such time, he would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification. Such adjustment shall be made successively whenever any event listed above shall occur.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case the Company shall issue or fix a record date for the issuance to all holders of Common Stock of rights, options, or warrants to subscribe for or purchase Common Stock (or securities convertible into or exchangeable for Common Stock) at a price per share (or having a conversion or exchange price per share, if a security convertible into or exchangeable for Common Stock) less than the then applicable Exercise Price per share on such record date, then, in each case, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock so to be offered (or the aggregate initial conversion or exchange price of the convertible or exchangeable securities so to be offered) would purchase at such Exercise Price and the denominator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of additional shares of Common Stock to be offered for subscription or purchase (or into which the convertible or exchangeable securities so to be offered are initially convertible or exchangeable). Such adjustment shall become effective at the close of business on such record date; provided, however, that, to the extent the shares of Common Stock (or securities convertible into or exchangeable for shares of Common Stock) are not delivered, the Exercise Price shall be readjusted after the expiration of such rights, options, or warrants (but only with respect to warrants exercised after such expiration), to the Exercise Price which would then be in effect had the adjustments made upon the issuance of such rights, options, or warrants been made upon the basis of delivery of only the number of shares of Common Stock (or securities convertible into or exchangeable for shares of Common Stock) actually issued. In case any subscription price may be paid in a consideration part or all of which shall be in a form other than cash, the value of such consideration shall be as determined in good faith by the board of directors of the Company, whose determination shall be conclusive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In case the Company shall distribute to all holders of Common Stock (including any such distribution made to the stockholders of the Company in connection with a consolidation or merger in which the Company is the continuing corporation) evidences of its indebtedness, cash (other than any cash dividend which, together with any cash dividends paid within the 12 months prior to the record date for such distribution, does not exceed 5% of the then applicable Exercise Price at the record date for such distribution) or assets (other than distributions and dividends payable in shares of Common Stock), or rights, options or warrants to subscribe for or purchase Common Stock, or securities convertible into or exchangeable for shares of Common Stock (excluding those with respect to the issuance of which an adjustment of the Exercise Price is provided pursuant to Section 5(b) hereof), then, in each case, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to the record date for the determination of stockholders entitled to receive such distribution by a fraction, the numerator of which shall be the then applicable Exercise Price per share of Common Stock on such record date, less the fair market value (as determined in good faith by, and reflected in a formal resolution of, the board of directors of the Company, whose determination shall be conclusive absent manifest error) of the portion of the evidences of indebtedness or assets so to be distributed, or of such rights, options or warrants or convertible or exchangeable securities, or the amount of such cash, applicable to one share, and the denominator of which shall be such Exercise Price per share of Common Stock. Such adjustment shall become effective at the close of business on such record date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No adjustment in the Exercise Price shall be required if such adjustment is less than $0.01; provided, however, that any adjustments which by reason of this Section 5(d) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 5 shall be made to the nearest cent or to the nearest one-thousandth of a share, as the case may be.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) In any case in which this Section 5 shall require that an adjustment in the Exercise Price be made effective as of a record date for a specified event, the Company may elect to defer, until the occurrence of such event, issuing to the Holder, if the Holder exercised this Warrant after such record date, the shares of Common Stock, if any, issuable upon such exercise over and above the shares of Common Stock, if any, issuable upon such exercise on the basis of the Exercise Price in effect prior to such adjustment; provided, however, that the Company shall deliver to the Holder a due bill or other appropriate instrument evidencing the Holder's right to receive such additional shares upon the occurrence of the event requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Upon each adjustment of the Exercise Price as a result of the calculations made in Sections 5(b) or 5(c) hereof, this Warrant shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of shares (calculated to the nearest thousandth) obtained by multiplying (A) the number of shares purchasable upon exercise of this Warrant prior to such adjustment by (B) a fraction, the numerator of which is the Exercise Price in effect prior to such adjustment and the denominator of which is the Exercise Price in effect immediately after such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Whenever there shall be an adjustment as provided in this Section 5, the Company shall promptly cause written notice thereof to be sent by registered mail, postage prepaid, to the Holder, at its address as it shall appear in the Warrant Register, which notice shall be accompanied by an officer's certificate setting forth the number of Warrant Shares purchasable upon the exercise of this Warrant and the Exercise Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment and the computation thereof, which officer's certificate shall be conclusive evidence of the correctness of any such adjustment absent manifest error.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) The Company shall not be required to issue fractions of shares of Common Stock or other capital stock of the Company upon the exercise of this Warrant. If any fraction of a share would be issuable on the exercise of this Warrant (or specified portions thereof), the Company shall purchase such fraction for an amount in cash equal to the same fraction of the Exercise Price of such share of Common Stock on the date of exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. (a) In case of any consolidation or combination with or merger of the Company with or into another corporation or entity (other than a merger, consolidation or combination in which the Company is the surviving or continuing corporation), or in case of any sale, lease or conveyance to another corporation, entity or person of the property and assets of any nature of the Company as an entirety or substantially as an entirety, or any compulsory share exchange, pursuant to which share exchange the Common Stock is converted into other securities, cash or other property (collectively an "<u>Extraordinary Event</u>"), then, as a condition of such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby the Holder shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Shares immediately theretofore issuable upon exercise of this Warrant, such shares of stock, securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable upon exercise of this Warrant, had such Extraordinary Event not taken place, and in any such case appropriate provision shall be made with respect to the rights and interests of the Holder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Exercise Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. The Company shall not effect any such Extraordinary Event unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such Extraordinary Event shall assume the obligation to deliver to the Holder, at the last address of the Holder appearing on the books of the Company, such shares of stock, securities or assets as, in accordance with the foregoing provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant. The provisions of this paragraph shall similarly apply to successive Extraordinary Events.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case of any reclassification or change of the shares of Common Stock issuable upon exercise of this Warrant (other than a change in par value or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), or in case of any consolidation, combination or merger of another corporation or entity into the Company in which the Company is the continuing corporation and in which there is a reclassification or change (including a change to the right to receive cash or other property) of the shares of Common Stock (other than a change in par value, or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), the Holder shall have the right thereafter to receive upon exercise of this Warrant solely the kind and amount of shares of stock and other securities, property or cash, or any combination thereof receivable upon such reclassification, change, consolidation, combination or merger by a holder of the number of shares of Common Stock for which this Warrant might have been exercised immediately prior to such reclassification, change, consolidation, combination or merger. Thereafter, appropriate provision shall be made for adjustments, which shall be as nearly equivalent as practicable to the adjustments in Section 5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The above provisions of this Section 6 shall similarly apply to successive reclassifications and changes of shares of Common Stock and to successive consolidations, combinations, mergers, sales, leases or conveyances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. In case at any time the Company shall propose to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) pay any dividend or make any distribution on shares of Common Stock in shares of Common Stock or make any other distribution (other than regularly scheduled cash dividends which are not in a greater amount per share than the most recent such cash dividend) to all holders of Common Stock; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) issue any rights, warrants or other securities to all holders of Common Stock entitling them to purchase any additional shares of Common Stock or any other rights, warrants or other securities; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) effect any reclassification or change of outstanding shares of Common Stock, or any consolidation, merger, sale, lease or conveyance of property or other Extraordinary Event; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) effect any liquidation, dissolution or winding-up of the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) take any other action which would cause an adjustment to the Exercise Price;

then, and in any one or more of such cases, the Company shall give written notice thereof, by registered mail, postage prepaid, to the Holder at the Holder's address as it shall appear in the Warrant Register, mailed at least 15 days prior to (i) the date as of which the holders of record of shares of Common Stock to be entitled to receive any such dividend, distribution, rights, warrants or other securities are to be determined, (ii) the date on which any such reclassification, change of outstanding shares of Common Stock, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution or winding-up is expected to become effective, and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange their shares for securities or other property, if any, deliverable upon such reclassification, change of outstanding shares, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution, or winding-up, or (iii) the date of such action which would require an adjustment to the Exercise Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. The issuance of any shares or other securities upon the exercise of this Warrant, and the delivery of certificates or other instruments representing such shares or other securities, shall be made without charge to the Holder for any tax or other charge in respect of such issuance. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of any certificate in a name other than that of the Holder and the Company shall not be required to issue or deliver any such certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Unless registered pursuant to the Registration Rights Agreement, the Warrant Shares issued upon exercise of this Warrant shall be subject to a stop transfer order and the certificate or certificates evidencing such Warrant Shares shall bear the following legend:

"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "<u>ACT</u>"), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of any Warrant (and upon surrender of any Warrant if mutilated), the Company shall execute and deliver to the Holder thereof a new Warrant of like date, tenor and denomination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. The holder of this Warrant shall not have solely on account of such status, any rights of a stockholder of the Company, either at law or in equity, or to any notice of meetings of stockholders or of any other proceedings of the Company, except as provided in this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Any term of this Warrant may be amended or waived upon the written consent of the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. This Warrant has been negotiated and consummated in the State of New York and shall be governed by, and construed in accordance with the laws of the State of New York applicable to contracts made and performed within such State, without regard to principles governing conflicts of law. The Company and, by accepting this Warrant, the Holder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under the Subscription Agreements. The Company and, by accepting this Warrant, the Holder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this Warrant, the Holder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. **EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE HOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.**

Dated: April 22, 2025

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| | |
|:---|:---|
| CalEthos Inc. | CalEthos Inc. |
| By: | /s/ Michael Campbell |
| Name: | Michael Campbell |
| Title: | Chief Executive Officer |

---

**CALETHOS INC.**

**FORM OF ASSIGNMENT**

(To be executed by the registered holder if such

holder desires to transfer the attached Warrant.)

---

| | |
|:---|:---|
| To: | CalEthos Inc. |
|  | 11753 Willard Avenue |
|  | Tustin, CA 92782 |
|  | Attention: Chief Executive Officer |

---

FOR VALUE RECEIVED,<u> </u> hereby sells, assigns, and transfers unto<u> </u> that certain Warrant (Number WA) to purchase<u> </u> shares of Common Stock, par value $0.001 per share, of CalEthos Inc. (the "<u>Company</u>"), together with all right, title, and interest therein, and does hereby irrevocably constitute and appoint attorney to transfer such Warrant on the books of the Company, with full power of substitution.

Dated: ________________

Signature:  

<u>Notice:</u>

The signature on the foregoing Assignment must correspond to the name as written upon the face of this Warrant in every particular, without alteration or enlargement or any change whatsoever.

**CALETHOS INC. EXERCISE FORM**

(To be completed and signed only upon exercise of the Warrants)

---

| | |
|:---|:---|
| To: | CalEthos Inc. |
|  | 11753 Willard Avenue |
|  | Tustin, CA 92782 |
|  | Attention: Chief Executive Officer |

---

The undersigned hereby exercises his or its rights to purchase ___________ Warrant Shares covered by the within Warrant and tenders payment herewith in the amount of $________ by [tendering cash, a wire of immediately available funds or delivering a certified check or bank cashier's check, payable to the order of the Company] [surrendering _________ shares of Common Stock received upon exercise of the attached Warrant, which shares have a Current Market Price equal to such payment] in accordance with the terms thereof, and requests that certificates for such securities be issued in the name of, and delivered to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Print Name, Address and Social Security or Tax Identification Number)

and, if such number of Warrant Shares shall not be all the Warrant Shares covered by the within Warrant, that a new Warrant for the balance of the Warrant Shares covered by the within Warrant be registered in the name of, and delivered to, the undersigned at the address stated below.

---

| | | |
|:---|:---|:---|
| Dated:<u> </u>, | Name: | |
|  |  | (Please Print) |
|  | Address: | |

---

## Exhibit 10.8

**Exhibit 10.8**

**WARRANT**

**THE WARRANT REPRESENTED BY THIS CERTIFICATE AND THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS IN RELIANCE ON EXEMPTIONS FROM REGISTRATION REQUIREMENTS UNDER SAID LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.**

**THE TRANSFER OF THIS WARRANT IS**

**R** **ESTRICTED AS DESCRIBED HEREIN.**

**CALETHOS INC.**

Warrant for the Purchase of up to 2,000,000

Shares of Common Stock, par value $0.001 per share

---

| | |
|:---|:---|
| **No. WA<u> </u>** | **2,000,000 Shares** |
| **Issue Date:** July 22, 2025 |  |

---

THIS CERTIFIES that, for value received, SFO IDC LLC, with an address at 787 N. Palm Canyon Drive, Palm Springs, California 92262 (including any transferee, the "<u>Holder</u>"), is entitled to subscribe for and purchase from CalEthos Inc., a Nevada corporation (the "<u>Company</u>"), upon the terms and conditions set forth herein, at any time or from time to time before 5:00 P.M., New York time, on January 31, 2031 (the "<u>Exercise Period</u>"), up to Two Million (2,000,000) shares of Common Stock, par value $0.001 per share (the "<u>Common Stock</u>"), at an initial exercise price per share of $0.50, subject to adjustment pursuant to the terms hereof (the "<u>Exercise Price</u>"). As used herein, the term "this Warrant" shall mean and include this Warrant and any Warrant or Warrants hereafter issued as a consequence of the exercise or transfer of this Warrant in whole or in part.

The number of shares of Common Stock issuable upon exercise of this Warrant (the "<u>Warrant Shares</u>") and the Exercise Price may be adjusted from time to time as hereinafter set forth.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. (a) This Warrant may be exercised during the Exercise Period as to all or a lesser number of whole Warrant Shares by the surrender of this Warrant (with the Exercise Form attached hereto duly executed) to the Company at its principal executive office, which is located on the date hereof at 11753 Willard Avenue, Tustin, CA 92782, Attention: Chief Financial Officer, or at such other place as is designated in writing by the Company, together with cash, a certified or bank cashier's check or wire transfer of immediately available funds payable to the order of the Company in an amount equal to the Exercise Price multiplied by the number of Warrant Shares for which this Warrant is being exercised.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Warrant may also be exercised by the Holder through a cashless exercise, as described in this Section 1(b). This Warrant may be exercised, in whole or in part, by (i) the delivery to the Company of a duly executed Exercise Form specifying the number of Warrant Shares to be applied to such exercise, and (ii) the surrender to a common carrier for overnight delivery to the Company, or as soon as practicable following the date the Holder delivers the Exercise Form to the Company, of this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction). The number of shares of Common Stock to be issued upon exercise of this Warrant pursuant to this Section 1(b) shall equal the value of this Warrant (or the portion thereof being canceled) computed as of the date of delivery of this Warrant to the Company using the following formula:

where:

---

| | |
|:---|:---|
| X = | <u>Y(A-B)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;A |
| X = | the number of shares of Common Stock to be issued to the Holder under this Section 1(b); |
| Y = | the number of Warrant Shares identified in the Exercise Form as being applied to the subject exercise; |
| A = | the Current Market Price on such date; and |
| B = | the Exercise Price on such date |

---

For purposes of this Section 1(b), the "<u>Current Market Price</u>" per share of Common Stock on any day shall mean: (i) if the principal trading market for such securities is a national or regional securities exchange, the closing price on such exchange on such day; or (ii) if (i) above is not applicable, and if bid and ask prices for shares of Common Stock are reported in the over-the-counter market of the OTC Markets Group, Inc., the average of the high bid and low ask prices so reported on such day. Notwithstanding the foregoing, if there is no reported closing price or bid and ask prices, as the case may be, for the day in question, then the Current Market Price shall be determined as of the latest date prior to such day for which such closing price or bid and ask prices, as the case may be, are available, unless such securities have not been traded on an exchange or in the over-the-counter market for 30 or more days immediately prior to the day in question, in which case the Current Market Price shall be determined in good faith by, and reflected in a formal resolution of, the Board of Directors of the Company.

The Company acknowledges and agrees that this Warrant was issued on the Issue Date set forth on the face of this Warrant (the "<u>Issuance Date</u>"). Consequently, the Company acknowledges and agrees that, if the Holder conducts a cashless exercise pursuant to this Section 1(b), the period during which the Holder held this Warrant may, for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "<u>Act</u>"), be "tacked" to the period during which the Holder holds the Warrant Shares received upon such cashless exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Upon each exercise of the Holder's rights to purchase Warrant Shares, the Holder shall be deemed to be the holder of record of the Warrant Shares issuable upon such exercise, notwithstanding that the transfer books of the Company shall then be closed or certificates representing such Warrant Shares shall not then have been actually delivered to the Holder. As soon as practicable after each such exercise of this Warrant, the Company shall issue and deliver to the Holder a certificate or certificates for the Warrant Shares issuable upon such exercise, registered in the name of the Holder or its designee. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute and deliver a new Warrant evidencing the right of the Holder to purchase the balance of the Warrant Shares (or portions thereof) subject to purchase hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. (a) Any Warrants issued upon the registration of transfer or exercise in part of this Warrant shall be numbered and shall be registered in a Warrant Register as they are issued. The Company shall be entitled to treat the registered holder of any Warrant on the Warrant Register as the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to or interest in such Warrant on the part of any other person, and shall not be liable for any registration or transfer of Warrants which are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary unless made with the actual knowledge that a fiduciary or nominee is committing a breach of trust in requesting such registration or transfer, or with the knowledge of such facts that its participation therein amounts to bad faith. The transfer of this Warrant may be registered on the books of the Company upon delivery thereof duly endorsed by the Holder or by his duly authorized attorney or representative, or accompanied by proper evidence of succession, assignment or authority to transfer. In all cases of transfer by an attorney, executor, administrator, guardian or other legal representative, due authority shall be produced. Upon any registration of transfer, the Company shall deliver a new Warrant or Warrants to the person entitled thereto. This Warrant may be exchanged, at the option of the Holder thereof, for another Warrant, or other Warrants of different denominations, of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares (or portions thereof), upon surrender to the Company or its duly authorized agent. Notwithstanding the foregoing, the Company may require prior to registering any transfer of a Warrant an opinion of counsel reasonably satisfactory to the Company that such transfer complies with the provisions of the Act, and the rules and regulations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Holder acknowledges that he has been advised by the Company that neither this Warrant nor the Warrant Shares have been registered under the Act, that this Warrant is being or has been issued and the Warrant Shares may be issued on the basis of the statutory exemption provided by Section 4(2) of the Act or Rule 506 of Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering, and that the Company's reliance thereon is based in part upon the representations made by the original Holder in the Subscription Agreements. The Holder acknowledges that he has been informed by the Company of, or is otherwise familiar with, the nature of the limitations imposed by the Act and the rules and regulations thereunder on the transfer of securities. In particular, the Holder agrees that no sale, assignment or transfer of this Warrant or the Warrant Shares issuable upon exercise hereof shall be valid or effective, and the Company shall not be required to give any effect to any such sale, assignment or transfer, unless (i) the sale, assignment or transfer of this Warrant or such Warrant Shares is registered under the Act, it being understood that neither this Warrant nor such Warrant Shares are currently registered for sale and that the Company has no obligation or intention to so register this Warrant or such Warrant Shares except as specifically provided for in the Registration Rights Agreement (as defined or described in the Subscription Agreement), or (ii) this Warrant or such Warrant Shares are sold, assigned or transferred in accordance with all the requirements and limitations of Rule 144 under the Act, it being understood that Rule 144 is not available at the time of the original issuance of this Warrant for the sale of this Warrant or such Warrant Shares and that there can be no assurance that Rule 144 sales will be available at any subsequent time, or (iii) such sale, assignment, or transfer is otherwise exempt from registration under the Act in the opinion of counsel reasonably acceptable to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Company shall at all times reserve and keep available out its authorized and unissued Common Stock, solely for the purpose of providing for the exercise of the rights to purchase all Warrant Shares granted pursuant to the Warrants, such number of shares of Common Stock as shall, from time to time, be sufficient therefor. The Company covenants that all shares of Common Stock issuable upon exercise of this Warrant, upon receipt by the Company of the full Exercise Price therefor, shall be validly issued, fully paid, nonassessable, and free of preemptive rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. (a) In case the Company shall at any time after the date the Warrants were first issued (i) declare a dividend on the outstanding Common Stock payable in shares of its capital stock, (ii) subdivide the outstanding Common Stock, (iii) combine the outstanding Common Stock into a smaller number of shares, or (iv) issue any shares of its capital stock by reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), then, in each case, the Exercise Price, and the number of Warrant Shares issuable upon exercise of this Warrant, in effect at the time of the record date for such dividend or of the effective date of such subdivision, combination or reclassification, shall be proportionately adjusted so that the Holder after such time shall be entitled to receive the aggregate number and kind of shares which, if such Warrant had been exercised immediately prior to such time, he would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification. Such adjustment shall be made successively whenever any event listed above shall occur.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case the Company shall issue or fix a record date for the issuance to all holders of Common Stock of rights, options, or warrants to subscribe for or purchase Common Stock (or securities convertible into or exchangeable for Common Stock) at a price per share (or having a conversion or exchange price per share, if a security convertible into or exchangeable for Common Stock) less than the then applicable Exercise Price per share on such record date, then, in each case, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock so to be offered (or the aggregate initial conversion or exchange price of the convertible or exchangeable securities so to be offered) would purchase at such Exercise Price and the denominator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of additional shares of Common Stock to be offered for subscription or purchase (or into which the convertible or exchangeable securities so to be offered are initially convertible or exchangeable). Such adjustment shall become effective at the close of business on such record date; provided, however, that, to the extent the shares of Common Stock (or securities convertible into or exchangeable for shares of Common Stock) are not delivered, the Exercise Price shall be readjusted after the expiration of such rights, options, or warrants (but only with respect to warrants exercised after such expiration), to the Exercise Price which would then be in effect had the adjustments made upon the issuance of such rights, options, or warrants been made upon the basis of delivery of only the number of shares of Common Stock (or securities convertible into or exchangeable for shares of Common Stock) actually issued. In case any subscription price may be paid in a consideration part or all of which shall be in a form other than cash, the value of such consideration shall be as determined in good faith by the board of directors of the Company, whose determination shall be conclusive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In case the Company shall distribute to all holders of Common Stock (including any such distribution made to the stockholders of the Company in connection with a consolidation or merger in which the Company is the continuing corporation) evidences of its indebtedness, cash (other than any cash dividend which, together with any cash dividends paid within the 12 months prior to the record date for such distribution, does not exceed 5% of the then applicable Exercise Price at the record date for such distribution) or assets (other than distributions and dividends payable in shares of Common Stock), or rights, options or warrants to subscribe for or purchase Common Stock, or securities convertible into or exchangeable for shares of Common Stock (excluding those with respect to the issuance of which an adjustment of the Exercise Price is provided pursuant to Section 5(b) hereof), then, in each case, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to the record date for the determination of stockholders entitled to receive such distribution by a fraction, the numerator of which shall be the then applicable Exercise Price per share of Common Stock on such record date, less the fair market value (as determined in good faith by, and reflected in a formal resolution of, the board of directors of the Company, whose determination shall be conclusive absent manifest error) of the portion of the evidences of indebtedness or assets so to be distributed, or of such rights, options or warrants or convertible or exchangeable securities, or the amount of such cash, applicable to one share, and the denominator of which shall be such Exercise Price per share of Common Stock. Such adjustment shall become effective at the close of business on such record date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No adjustment in the Exercise Price shall be required if such adjustment is less than $0.01; provided, however, that any adjustments which by reason of this Section 5(d) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 5 shall be made to the nearest cent or to the nearest one-thousandth of a share, as the case may be.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) In any case in which this Section 5 shall require that an adjustment in the Exercise Price be made effective as of a record date for a specified event, the Company may elect to defer, until the occurrence of such event, issuing to the Holder, if the Holder exercised this Warrant after such record date, the shares of Common Stock, if any, issuable upon such exercise over and above the shares of Common Stock, if any, issuable upon such exercise on the basis of the Exercise Price in effect prior to such adjustment; provided, however, that the Company shall deliver to the Holder a due bill or other appropriate instrument evidencing the Holder's right to receive such additional shares upon the occurrence of the event requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Upon each adjustment of the Exercise Price as a result of the calculations made in Sections 5(b) or 5(c) hereof, this Warrant shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of shares (calculated to the nearest thousandth) obtained by multiplying (A) the number of shares purchasable upon exercise of this Warrant prior to such adjustment by (B) a fraction, the numerator of which is the Exercise Price in effect prior to such adjustment and the denominator of which is the Exercise Price in effect immediately after such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Whenever there shall be an adjustment as provided in this Section 5, the Company shall promptly cause written notice thereof to be sent by registered mail, postage prepaid, to the Holder, at its address as it shall appear in the Warrant Register, which notice shall be accompanied by an officer's certificate setting forth the number of Warrant Shares purchasable upon the exercise of this Warrant and the Exercise Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment and the computation thereof, which officer's certificate shall be conclusive evidence of the correctness of any such adjustment absent manifest error.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) The Company shall not be required to issue fractions of shares of Common Stock or other capital stock of the Company upon the exercise of this Warrant. If any fraction of a share would be issuable on the exercise of this Warrant (or specified portions thereof), the Company shall purchase such fraction for an amount in cash equal to the same fraction of the Exercise Price of such share of Common Stock on the date of exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. (a) In case of any consolidation or combination with or merger of the Company with or into another corporation or entity (other than a merger, consolidation or combination in which the Company is the surviving or continuing corporation), or in case of any sale, lease or conveyance to another corporation, entity or person of the property and assets of any nature of the Company as an entirety or substantially as an entirety, or any compulsory share exchange, pursuant to which share exchange the Common Stock is converted into other securities, cash or other property (collectively an "<u>Extraordinary Event</u>"), then, as a condition of such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby the Holder shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Shares immediately theretofore issuable upon exercise of this Warrant, such shares of stock, securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable upon exercise of this Warrant, had such Extraordinary Event not taken place, and in any such case appropriate provision shall be made with respect to the rights and interests of the Holder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Exercise Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. The Company shall not effect any such Extraordinary Event unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such Extraordinary Event shall assume the obligation to deliver to the Holder, at the last address of the Holder appearing on the books of the Company, such shares of stock, securities or assets as, in accordance with the foregoing provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant. The provisions of this paragraph shall similarly apply to successive Extraordinary Events.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case of any reclassification or change of the shares of Common Stock issuable upon exercise of this Warrant (other than a change in par value or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), or in case of any consolidation, combination or merger of another corporation or entity into the Company in which the Company is the continuing corporation and in which there is a reclassification or change (including a change to the right to receive cash or other property) of the shares of Common Stock (other than a change in par value, or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), the Holder shall have the right thereafter to receive upon exercise of this Warrant solely the kind and amount of shares of stock and other securities, property or cash, or any combination thereof receivable upon such reclassification, change, consolidation, combination or merger by a holder of the number of shares of Common Stock for which this Warrant might have been exercised immediately prior to such reclassification, change, consolidation, combination or merger. Thereafter, appropriate provision shall be made for adjustments, which shall be as nearly equivalent as practicable to the adjustments in Section 5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The above provisions of this Section 6 shall similarly apply to successive reclassifications and changes of shares of Common Stock and to successive consolidations, combinations, mergers, sales, leases or conveyances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. In case at any time the Company shall propose to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) pay any dividend or make any distribution on shares of Common Stock in shares of Common Stock or make any other distribution (other than regularly scheduled cash dividends which are not in a greater amount per share than the most recent such cash dividend) to all holders of Common Stock; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) issue any rights, warrants or other securities to all holders of Common Stock entitling them to purchase any additional shares of Common Stock or any other rights, warrants or other securities; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) effect any reclassification or change of outstanding shares of Common Stock, or any consolidation, merger, sale, lease or conveyance of property or other Extraordinary Event; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) effect any liquidation, dissolution or winding-up of the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) take any other action which would cause an adjustment to the Exercise Price;

then, and in any one or more of such cases, the Company shall give written notice thereof, by registered mail, postage prepaid, to the Holder at the Holder's address as it shall appear in the Warrant Register, mailed at least 15 days prior to (i) the date as of which the holders of record of shares of Common Stock to be entitled to receive any such dividend, distribution, rights, warrants or other securities are to be determined, (ii) the date on which any such reclassification, change of outstanding shares of Common Stock, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution or winding-up is expected to become effective, and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange their shares for securities or other property, if any, deliverable upon such reclassification, change of outstanding shares, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution, or winding-up, or (iii) the date of such action which would require an adjustment to the Exercise Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. The issuance of any shares or other securities upon the exercise of this Warrant, and the delivery of certificates or other instruments representing such shares or other securities, shall be made without charge to the Holder for any tax or other charge in respect of such issuance. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of any certificate in a name other than that of the Holder and the Company shall not be required to issue or deliver any such certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Unless registered pursuant to the Act, the Warrant Shares issued upon exercise of this Warrant shall be subject to a stop transfer order and the certificate or certificates evidencing such Warrant Shares shall bear the following legend:

"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "<u>ACT</u>"), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of any Warrant (and upon surrender of any Warrant if mutilated), the Company shall execute and deliver to the Holder thereof a new Warrant of like date, tenor and denomination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. The holder of this Warrant shall not have solely on account of such status, any rights of a stockholder of the Company, either at law or in equity, or to any notice of meetings of stockholders or of any other proceedings of the Company, except as provided in this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Any term of this Warrant may be amended or waived upon the written consent of the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. This Warrant has been negotiated and consummated in the State of New York and shall be governed by, and construed in accordance with the laws of the State of New York applicable to contracts made and performed within such State, without regard to principles governing conflicts of law. The Company and, by accepting this Warrant, the Holder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under the Subscription Agreements. The Company and, by accepting this Warrant, the Holder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this Warrant, the Holder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. **EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE HOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.**

Dated: July 22, 2025

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| | |
|:---|:---|
| CalEthos Inc. | CalEthos Inc. |
| By: | /s/ Michael Campbell |
| Name: | Michael Campbell |
| Title: | Chief Executive Officer |

---

**CALETHOS INC.**

**FORM OF ASSIGNMENT**

(To be executed by the registered holder if such

holder desires to transfer the attached Warrant.)

---

| | |
|:---|:---|
| To: | CalEthos Inc. |
|  | 11753 Willard Avenue |
|  | Tustin, CA 92782 |
|  | Attention: Chief Executive Officer |

---

FOR VALUE RECEIVED,<u> </u> hereby sells, assigns, and transfers unto<u> </u> that certain Warrant (Number WA) to purchase<u> </u> shares of Common Stock, par value $0.001 per share, of CalEthos Inc. (the "<u>Company</u>"), together with all right, title, and interest therein, and does hereby irrevocably constitute and appoint attorney to transfer such Warrant on the books of the Company, with full power of substitution.

Dated: ________________

Signature:  

<u>Notice:</u>

The signature on the foregoing Assignment must correspond to the name as written upon the face of this Warrant in every particular, without alteration or enlargement or any change whatsoever.

**CALETHOS INC. EXERCISE FORM**

(To be completed and signed only upon exercise of the Warrants)

---

| | |
|:---|:---|
| To: | CalEthos Inc. |
|  | 11753 Willard Avenue |
|  | Tustin, CA 92782 |
|  | Attention: Chief Executive Officer |

---

The undersigned hereby exercises his or its rights to purchase ___________ Warrant Shares covered by the within Warrant and tenders payment herewith in the amount of $________ by [tendering cash, a wire of immediately available funds or delivering a certified check or bank cashier's check, payable to the order of the Company] [surrendering _________ shares of Common Stock received upon exercise of the attached Warrant, which shares have a Current Market Price equal to such payment] in accordance with the terms thereof, and requests that certificates for such securities be issued in the name of, and delivered to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Print Name, Address and Social Security or Tax Identification Number)

and, if such number of Warrant Shares shall not be all the Warrant Shares covered by the within Warrant, that a new Warrant for the balance of the Warrant Shares covered by the within Warrant be registered in the name of, and delivered to, the undersigned at the address stated below.

---

| | | |
|:---|:---|:---|
| Dated:<u> </u>, | Name: | |
|  |  | (Please Print) |
|  | Address: | |

---

## Exhibit 10.9

**Exhibit 10.9**

**WARRANT**

**THE WARRANT REPRESENTED BY THIS CERTIFICATE AND THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS IN RELIANCE ON EXEMPTIONS FROM REGISTRATION REQUIREMENTS UNDER SAID LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS.**

**THE TRANSFER OF THIS WARRANT IS**

**R** **ESTRICTED AS DESCRIBED HEREIN.**

**CALETHOS INC.**

**Warrant for the Purchase of up to 1,000,000 Shares of Common Stock, par value $0.001 per share**

---

| | |
|:---|:---|
| **No. WA<u> </u>** | **1,000,000 Shares** |
| **Issue Date:** December 15, 2025 |  |

---

THIS CERTIFIES that, for value received, SFO IDC LLC, with an address at 787 N. Palm Canyon Drive, Palm Springs, California 92262 (including any transferee, the "<u>Holder</u>"), is entitled to subscribe for and purchase from CalEthos Inc., a Nevada corporation (the "<u>Company</u>"), upon the terms and conditions set forth herein, at any time or from time to time before 5:00 P.M., New York time, on June 30, 2031 (the "<u>Exercise Period</u>"), up to One Million (1,000,000) shares of Common Stock, par value $0.001 per share (the "<u>Common Stock</u>"), at an initial exercise price per share of $0.50, subject to adjustment pursuant to the terms hereof (the "<u>Exercise Price</u>"). As used herein, the term "this Warrant" shall mean and include this Warrant and any Warrant or Warrants hereafter issued as a consequence of the exercise or transfer of this Warrant in whole or in part.

The number of shares of Common Stock issuable upon exercise of this Warrant (the "<u>Warrant Shares</u>") and the Exercise Price may be adjusted from time to time as hereinafter set forth.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. (a) This Warrant may be exercised during the Exercise Period as to all or a lesser number of whole Warrant Shares by the surrender of this Warrant (with the Exercise Form attached hereto duly executed) to the Company at its principal executive office, which is located on the date hereof at 11753 Willard Avenue, Tustin, CA 92782, Attention: Chief Financial Officer, or at such other place as is designated in writing by the Company, together with cash, a certified or bank cashier's check or wire transfer of immediately available funds payable to the order of the Company in an amount equal to the Exercise Price multiplied by the number of Warrant Shares for which this Warrant is being exercised.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Warrant may also be exercised by the Holder through a cashless exercise, as described in this Section 1(b). This Warrant may be exercised, in whole or in part, by (i) the delivery to the Company of a duly executed Exercise Form specifying the number of Warrant Shares to be applied to such exercise, and (ii) the surrender to a common carrier for overnight delivery to the Company, or as soon as practicable following the date the Holder delivers the Exercise Form to the Company, of this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction). The number of shares of Common Stock to be issued upon exercise of this Warrant pursuant to this Section 1(b) shall equal the value of this Warrant (or the portion thereof being canceled) computed as of the date of delivery of this Warrant to the Company using the following formula:

where:

---

| | |
|:---|:---|
| X = | <u>Y(A-B)</u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;A |
| X = | the number of shares of Common Stock to be issued to the Holder under this Section 1(b); |
| Y = | the number of Warrant Shares identified in the Exercise Form as being applied to the subject exercise; |
| A = | the Current Market Price on such date; and |
| B = | the Exercise Price on such date |

---

For purposes of this Section 1(b), the "<u>Current Market Price</u>" per share of Common Stock on any day shall mean: (i) if the principal trading market for such securities is a national or regional securities exchange, the closing price on such exchange on such day; or (ii) if (i) above is not applicable, and if bid and ask prices for shares of Common Stock are reported in the over-the-counter market of the OTC Markets Group, Inc., the average of the high bid and low ask prices so reported on such day. Notwithstanding the foregoing, if there is no reported closing price or bid and ask prices, as the case may be, for the day in question, then the Current Market Price shall be determined as of the latest date prior to such day for which such closing price or bid and ask prices, as the case may be, are available, unless such securities have not been traded on an exchange or in the over-the-counter market for 30 or more days immediately prior to the day in question, in which case the Current Market Price shall be determined in good faith by, and reflected in a formal resolution of, the Board of Directors of the Company.

The Company acknowledges and agrees that this Warrant was issued on the Issue Date set forth on the face of this Warrant (the "<u>Issuance Date</u>"). Consequently, the Company acknowledges and agrees that, if the Holder conducts a cashless exercise pursuant to this Section 1(b), the period during which the Holder held this Warrant may, for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "<u>Act</u>"), be "tacked" to the period during which the Holder holds the Warrant Shares received upon such cashless exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Upon each exercise of the Holder's rights to purchase Warrant Shares, the Holder shall be deemed to be the holder of record of the Warrant Shares issuable upon such exercise, notwithstanding that the transfer books of the Company shall then be closed or certificates representing such Warrant Shares shall not then have been actually delivered to the Holder. As soon as practicable after each such exercise of this Warrant, the Company shall issue and deliver to the Holder a certificate or certificates for the Warrant Shares issuable upon such exercise, registered in the name of the Holder or its designee. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute and deliver a new Warrant evidencing the right of the Holder to purchase the balance of the Warrant Shares (or portions thereof) subject to purchase hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. (a) Any Warrants issued upon the registration of transfer or exercise in part of this Warrant shall be numbered and shall be registered in a Warrant Register as they are issued. The Company shall be entitled to treat the registered holder of any Warrant on the Warrant Register as the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to or interest in such Warrant on the part of any other person, and shall not be liable for any registration or transfer of Warrants which are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary unless made with the actual knowledge that a fiduciary or nominee is committing a breach of trust in requesting such registration or transfer, or with the knowledge of such facts that its participation therein amounts to bad faith. The transfer of this Warrant may be registered on the books of the Company upon delivery thereof duly endorsed by the Holder or by his duly authorized attorney or representative, or accompanied by proper evidence of succession, assignment or authority to transfer. In all cases of transfer by an attorney, executor, administrator, guardian or other legal representative, due authority shall be produced. Upon any registration of transfer, the Company shall deliver a new Warrant or Warrants to the person entitled thereto. This Warrant may be exchanged, at the option of the Holder thereof, for another Warrant, or other Warrants of different denominations, of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares (or portions thereof), upon surrender to the Company or its duly authorized agent. Notwithstanding the foregoing, the Company may require prior to registering any transfer of a Warrant an opinion of counsel reasonably satisfactory to the Company that such transfer complies with the provisions of the Act, and the rules and regulations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Holder acknowledges that he has been advised by the Company that neither this Warrant nor the Warrant Shares have been registered under the Act, that this Warrant is being or has been issued and the Warrant Shares may be issued on the basis of the statutory exemption provided by Section 4(2) of the Act or Rule 506 of Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering, and that the Company's reliance thereon is based in part upon the representations made by the original Holder in the Subscription Agreements. The Holder acknowledges that he has been informed by the Company of, or is otherwise familiar with, the nature of the limitations imposed by the Act and the rules and regulations thereunder on the transfer of securities. In particular, the Holder agrees that no sale, assignment or transfer of this Warrant or the Warrant Shares issuable upon exercise hereof shall be valid or effective, and the Company shall not be required to give any effect to any such sale, assignment or transfer, unless (i) the sale, assignment or transfer of this Warrant or such Warrant Shares is registered under the Act, it being understood that neither this Warrant nor such Warrant Shares are currently registered for sale and that the Company has no obligation or intention to so register this Warrant or such Warrant Shares except as specifically provided for in the Registration Rights Agreement (as defined or described in the Subscription Agreement), or (ii) this Warrant or such Warrant Shares are sold, assigned or transferred in accordance with all the requirements and limitations of Rule 144 under the Act, it being understood that Rule 144 is not available at the time of the original issuance of this Warrant for the sale of this Warrant or such Warrant Shares and that there can be no assurance that Rule 144 sales will be available at any subsequent time, or (iii) such sale, assignment, or transfer is otherwise exempt from registration under the Act in the opinion of counsel reasonably acceptable to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Company shall at all times reserve and keep available out its authorized and unissued Common Stock, solely for the purpose of providing for the exercise of the rights to purchase all Warrant Shares granted pursuant to the Warrants, such number of shares of Common Stock as shall, from time to time, be sufficient therefor. The Company covenants that all shares of Common Stock issuable upon exercise of this Warrant, upon receipt by the Company of the full Exercise Price therefor, shall be validly issued, fully paid, nonassessable, and free of preemptive rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. (a) In case the Company shall at any time after the date the Warrants were first issued (i) declare a dividend on the outstanding Common Stock payable in shares of its capital stock, (ii) subdivide the outstanding Common Stock, (iii) combine the outstanding Common Stock into a smaller number of shares, or (iv) issue any shares of its capital stock by reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), then, in each case, the Exercise Price, and the number of Warrant Shares issuable upon exercise of this Warrant, in effect at the time of the record date for such dividend or of the effective date of such subdivision, combination or reclassification, shall be proportionately adjusted so that the Holder after such time shall be entitled to receive the aggregate number and kind of shares which, if such Warrant had been exercised immediately prior to such time, he would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification. Such adjustment shall be made successively whenever any event listed above shall occur.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case the Company shall issue or fix a record date for the issuance to all holders of Common Stock of rights, options, or warrants to subscribe for or purchase Common Stock (or securities convertible into or exchangeable for Common Stock) at a price per share (or having a conversion or exchange price per share, if a security convertible into or exchangeable for Common Stock) less than the then applicable Exercise Price per share on such record date, then, in each case, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock so to be offered (or the aggregate initial conversion or exchange price of the convertible or exchangeable securities so to be offered) would purchase at such Exercise Price and the denominator of which shall be the number of shares of Common Stock outstanding on such record date plus the number of additional shares of Common Stock to be offered for subscription or purchase (or into which the convertible or exchangeable securities so to be offered are initially convertible or exchangeable). Such adjustment shall become effective at the close of business on such record date; provided, however, that, to the extent the shares of Common Stock (or securities convertible into or exchangeable for shares of Common Stock) are not delivered, the Exercise Price shall be readjusted after the expiration of such rights, options, or warrants (but only with respect to warrants exercised after such expiration), to the Exercise Price which would then be in effect had the adjustments made upon the issuance of such rights, options, or warrants been made upon the basis of delivery of only the number of shares of Common Stock (or securities convertible into or exchangeable for shares of Common Stock) actually issued. In case any subscription price may be paid in a consideration part or all of which shall be in a form other than cash, the value of such consideration shall be as determined in good faith by the board of directors of the Company, whose determination shall be conclusive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In case the Company shall distribute to all holders of Common Stock (including any such distribution made to the stockholders of the Company in connection with a consolidation or merger in which the Company is the continuing corporation) evidences of its indebtedness, cash (other than any cash dividend which, together with any cash dividends paid within the 12 months prior to the record date for such distribution, does not exceed 5% of the then applicable Exercise Price at the record date for such distribution) or assets (other than distributions and dividends payable in shares of Common Stock), or rights, options or warrants to subscribe for or purchase Common Stock, or securities convertible into or exchangeable for shares of Common Stock (excluding those with respect to the issuance of which an adjustment of the Exercise Price is provided pursuant to Section 5(b) hereof), then, in each case, the Exercise Price shall be adjusted by multiplying the Exercise Price in effect immediately prior to the record date for the determination of stockholders entitled to receive such distribution by a fraction, the numerator of which shall be the then applicable Exercise Price per share of Common Stock on such record date, less the fair market value (as determined in good faith by, and reflected in a formal resolution of, the board of directors of the Company, whose determination shall be conclusive absent manifest error) of the portion of the evidences of indebtedness or assets so to be distributed, or of such rights, options or warrants or convertible or exchangeable securities, or the amount of such cash, applicable to one share, and the denominator of which shall be such Exercise Price per share of Common Stock. Such adjustment shall become effective at the close of business on such record date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No adjustment in the Exercise Price shall be required if such adjustment is less than $0.01; provided, however, that any adjustments which by reason of this Section 5(d) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 5 shall be made to the nearest cent or to the nearest one-thousandth of a share, as the case may be.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) In any case in which this Section 5 shall require that an adjustment in the Exercise Price be made effective as of a record date for a specified event, the Company may elect to defer, until the occurrence of such event, issuing to the Holder, if the Holder exercised this Warrant after such record date, the shares of Common Stock, if any, issuable upon such exercise over and above the shares of Common Stock, if any, issuable upon such exercise on the basis of the Exercise Price in effect prior to such adjustment; provided, however, that the Company shall deliver to the Holder a due bill or other appropriate instrument evidencing the Holder's right to receive such additional shares upon the occurrence of the event requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Upon each adjustment of the Exercise Price as a result of the calculations made in Sections 5(b) or 5(c) hereof, this Warrant shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of shares (calculated to the nearest thousandth) obtained by multiplying (A) the number of shares purchasable upon exercise of this Warrant prior to such adjustment by (B) a fraction, the numerator of which is the Exercise Price in effect prior to such adjustment and the denominator of which is the Exercise Price in effect immediately after such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Whenever there shall be an adjustment as provided in this Section 5, the Company shall promptly cause written notice thereof to be sent by registered mail, postage prepaid, to the Holder, at its address as it shall appear in the Warrant Register, which notice shall be accompanied by an officer's certificate setting forth the number of Warrant Shares purchasable upon the exercise of this Warrant and the Exercise Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment and the computation thereof, which officer's certificate shall be conclusive evidence of the correctness of any such adjustment absent manifest error.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) The Company shall not be required to issue fractions of shares of Common Stock or other capital stock of the Company upon the exercise of this Warrant. If any fraction of a share would be issuable on the exercise of this Warrant (or specified portions thereof), the Company shall purchase such fraction for an amount in cash equal to the same fraction of the Exercise Price of such share of Common Stock on the date of exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. (a) In case of any consolidation or combination with or merger of the Company with or into another corporation or entity (other than a merger, consolidation or combination in which the Company is the surviving or continuing corporation), or in case of any sale, lease or conveyance to another corporation, entity or person of the property and assets of any nature of the Company as an entirety or substantially as an entirety, or any compulsory share exchange, pursuant to which share exchange the Common Stock is converted into other securities, cash or other property (collectively an "<u>Extraordinary Event</u>"), then, as a condition of such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby the Holder shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Shares immediately theretofore issuable upon exercise of this Warrant, such shares of stock, securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable upon exercise of this Warrant, had such Extraordinary Event not taken place, and in any such case appropriate provision shall be made with respect to the rights and interests of the Holder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Exercise Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. The Company shall not effect any such Extraordinary Event unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such Extraordinary Event shall assume the obligation to deliver to the Holder, at the last address of the Holder appearing on the books of the Company, such shares of stock, securities or assets as, in accordance with the foregoing provisions, the Holder may be entitled to purchase, and the other obligations under this Warrant. The provisions of this paragraph shall similarly apply to successive Extraordinary Events.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In case of any reclassification or change of the shares of Common Stock issuable upon exercise of this Warrant (other than a change in par value or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), or in case of any consolidation, combination or merger of another corporation or entity into the Company in which the Company is the continuing corporation and in which there is a reclassification or change (including a change to the right to receive cash or other property) of the shares of Common Stock (other than a change in par value, or from no par value to a specified par value, or as a result of a subdivision or combination, but including any change in the shares into two or more classes or series of shares), the Holder shall have the right thereafter to receive upon exercise of this Warrant solely the kind and amount of shares of stock and other securities, property or cash, or any combination thereof receivable upon such reclassification, change, consolidation, combination or merger by a holder of the number of shares of Common Stock for which this Warrant might have been exercised immediately prior to such reclassification, change, consolidation, combination or merger. Thereafter, appropriate provision shall be made for adjustments, which shall be as nearly equivalent as practicable to the adjustments in Section 5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The above provisions of this Section 6 shall similarly apply to successive reclassifications and changes of shares of Common Stock and to successive consolidations, combinations, mergers, sales, leases or conveyances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. In case at any time the Company shall propose to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) pay any dividend or make any distribution on shares of Common Stock in shares of Common Stock or make any other distribution (other than regularly scheduled cash dividends which are not in a greater amount per share than the most recent such cash dividend) to all holders of Common Stock; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) issue any rights, warrants or other securities to all holders of Common Stock entitling them to purchase any additional shares of Common Stock or any other rights, warrants or other securities; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) effect any reclassification or change of outstanding shares of Common Stock, or any consolidation, merger, sale, lease or conveyance of property or other Extraordinary Event; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) effect any liquidation, dissolution or winding-up of the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) take any other action which would cause an adjustment to the Exercise Price;

then, and in any one or more of such cases, the Company shall give written notice thereof, by registered mail, postage prepaid, to the Holder at the Holder's address as it shall appear in the Warrant Register, mailed at least 15 days prior to (i) the date as of which the holders of record of shares of Common Stock to be entitled to receive any such dividend, distribution, rights, warrants or other securities are to be determined, (ii) the date on which any such reclassification, change of outstanding shares of Common Stock, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution or winding-up is expected to become effective, and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange their shares for securities or other property, if any, deliverable upon such reclassification, change of outstanding shares, consolidation, merger, sale, lease, conveyance of property, liquidation, dissolution, or winding-up, or (iii) the date of such action which would require an adjustment to the Exercise Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. The issuance of any shares or other securities upon the exercise of this Warrant, and the delivery of certificates or other instruments representing such shares or other securities, shall be made without charge to the Holder for any tax or other charge in respect of such issuance. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of any certificate in a name other than that of the Holder and the Company shall not be required to issue or deliver any such certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Unless registered pursuant to the Act, the Warrant Shares issued upon exercise of this Warrant shall be subject to a stop transfer order and the certificate or certificates evidencing such Warrant Shares shall bear the following legend:

"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "<u>ACT</u>"), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Upon receipt of evidence satisfactory to the Company of the loss, theft, destruction or mutilation of any Warrant (and upon surrender of any Warrant if mutilated), the Company shall execute and deliver to the Holder thereof a new Warrant of like date, tenor and denomination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. The holder of this Warrant shall not have solely on account of such status, any rights of a stockholder of the Company, either at law or in equity, or to any notice of meetings of stockholders or of any other proceedings of the Company, except as provided in this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Any term of this Warrant may be amended or waived upon the written consent of the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. This Warrant has been negotiated and consummated in the State of New York and shall be governed by, and construed in accordance with the laws of the State of New York applicable to contracts made and performed within such State, without regard to principles governing conflicts of law. The Company and, by accepting this Warrant, the Holder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under the Subscription Agreements. The Company and, by accepting this Warrant, the Holder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this Warrant, the Holder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. **EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE HOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.**

Dated: December 15, 2025

---

| | |
|:---|:---|
| CalEthos Inc. | CalEthos Inc. |
| By: | /s/ Michael Campbell |
| Name: | Michael Campbell |
| Title: | Chief Executive Officer |

---

**CALETHOS INC.**

**FORM OF ASSIGNMENT**

(To be executed by the registered holder if such

holder desires to transfer the attached Warrant.)

---

| | |
|:---|:---|
| To: | CalEthos Inc. |
|  | 11753 Willard Avenue |
|  | Tustin, CA 92782 |
|  | Attention: Chief Executive Officer |

---

FOR VALUE RECEIVED,<u> </u> hereby sells, assigns, and transfers unto<u> </u> that certain Warrant (Number WA) to purchase<u> </u> shares of Common Stock, par value $0.001 per share, of CalEthos Inc. (the "<u>Company</u>"), together with all right, title, and interest therein, and does hereby irrevocably constitute and appoint attorney to transfer such Warrant on the books of the Company, with full power of substitution.

Dated: ________________

Signature:  

Notice:

The signature on the foregoing Assignment must correspond to the name as written upon the face of this Warrant in every particular, without alteration or enlargement or any change whatsoever.

**CALETHOS INC. EXERCISE FORM**

(To be completed and signed only upon exercise of the Warrants)

---

| | |
|:---|:---|
| To: | CalEthos Inc. |
|  | 11753 Willard Avenue |
|  | Tustin, CA 92782 |
|  | Attention: Chief Executive Officer |

---

The undersigned hereby exercises his or its rights to purchase <u>___________</u> Warrant Shares covered by the within Warrant and tenders payment herewith in the amount of $<u>________</u> by [tendering cash, a wire of immediately available funds or delivering a certified check or bank cashier's check, payable to the order of the Company] [surrendering <u>_________</u> shares of Common Stock received upon exercise of the attached Warrant, which shares have a Current Market Price equal to such payment] in accordance with the terms thereof, and requests that certificates for such securities be issued in the name of, and delivered to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Print Name, Address and Social Security or Tax Identification Number)

and, if such number of Warrant Shares shall not be all the Warrant Shares covered by the within Warrant, that a new Warrant for the balance of the Warrant Shares covered by the within Warrant be registered in the name of, and delivered to, the undersigned at the address stated below.

---

| | | |
|:---|:---|:---|
| Dated:<u> </u>, | Name: | |
|  |  | (Please Print) |
|  | Address: | |

---

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER**

**PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF**

**THE SARBANES-OXLEY ACT OF 2002**

I, Joel Stone, certify that:

1. I
 have reviewed this Annual Report on Form 10-K of CalEthos, Inc. (the "Registrant");

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
 (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
 Act Rules 13-a13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed
 such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to
 ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

c) Evaluated
 the effectiveness of the registrant's disclosure controls and procedures; and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation;
 and

d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
 or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's
 other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting,
 to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the
 equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

---

| | |
|:---|:---|
| Date: March 31, 2026 | */s/ Joel Stone* |
|  | Joel Stone |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER**

**PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF**

**THE SARBANES-OXLEY ACT OF 2002**

I, Dean S. Skupen, certify that:

1. I have reviewed
 this Annual Report on Form 10-K of CalEthos, Inc. (the "Registrant");

2. Based on my knowledge,
 this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
 made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
 report;

3. Based on my knowledge,
 the financial statements, and other financial information included in this report, fairly present in all material respects the financial
 condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's
 other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
 in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a13a-15(f)
 and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed
 such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to
 ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

c) Evaluated
 the effectiveness of the registrant's disclosure controls and procedures; and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation;
 and

d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
 or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's
 other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting,
 to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the
 equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

---

| | |
|:---|:---|
| Date: March 31, 2026 | */s/ Dean S. Skupen* |
|  | Dean S. Skupen |
|  | Chief Financial Officer |
|  | (Principal Financial Officer) |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION**

**OF PRINCIPAL EXECUTIVE OFFICER AND**

**PRINCIPAL FINANCIAL OFFICER**

**PURSUANT TO 18 U. S. C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report of CalEthos, Inc. (the "Company") on Form 10-K for the year ended December 31, 2025 (the "Report"), I, Joel Stone, Chief Executive Officer of the Company, and I, Dean S. Skupen, Chief Financial Officer of the Company, hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The
 Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and

2. The
 information contained in the Report fairly presents, in all material respects, the financial condition and results of operations
 of the Company.

---

| | |
|:---|:---|
| Date: March 31, 2026 | */s/ Joel Stone* |
|  | Joel Stone |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |
| Date: March 31, 2026 | */s/ Dean S. Skupen* |
|  | Dean S. Skupen |
|  | Chief Financial Officer |
|  | (Principal Financial Officer) |

---

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed from within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.