RENX 10-Q
RenX Enterprises Corp. (RENX)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
For the quarterly period ended
OR
For the transition period from ____________ to ____________
Commission File Number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (I.R.S. Employer | |
| incorporation or organization) | Identification No.) | |
| (Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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 the 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 ☐ |
| Smaller reporting company | |
| 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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of August 13, 2026 the issuer had a total of
RENX ENTERPRISES CORP. AND SUBSIDIARIES
FORM 10-Q
TABLE OF CONTENTS
i
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
RENX ENTERPRISES CORP. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| (Unaudited) | (Audited) | |||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash | $ | $ | ||||||
| Prepaid assets and other current assets | ||||||||
| Inventory | ||||||||
| Accounts receivable, net | ||||||||
| Current Assets | ||||||||
| Land | ||||||||
| Property and equipment, net | ||||||||
| Project development costs and other non-current assets | ||||||||
| Equity-based investments | ||||||||
| Intangible assets, net | ||||||||
| Right of use assets | ||||||||
| Goodwill | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities and Stockholder’s Equity | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Due to affiliates | ||||||||
| Short-term notes payable, net | ||||||||
| Notes payable - related party, current | ||||||||
| Operating lease liabilities, current | ||||||||
| Finance lease liabilities, current | ||||||||
| Derivative liability | ||||||||
| Total Current Liabilities | ||||||||
| Long-term notes payable, net | ||||||||
| Operating lease liabilities | ||||||||
| Finance lease liabilities | ||||||||
| Total Liabilities | ||||||||
| Stockholder’s Equity: | ||||||||
| Series A Preferred stock, $ | ||||||||
| Series B Preferred stock, $ | ||||||||
| Series C Preferred stock, $ | ||||||||
| Common stock, $ | ||||||||
| Additional paid-in capital | ||||||||
| Treasury stock, at cost – | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Stockholder’s Equity | ||||||||
| Total Liabilities and Stockholder’s Equity | $ | $ | ||||||
The accompanying notes are an integral part of these condensed financial statements.
1
RenX Enterprises Corp. and Subsidiaries
Condensed Consolidated Statements of Operations
| For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Revenue | ||||||||||||||||
| Sales | $ | $ | $ | $ | ||||||||||||
| Total | ||||||||||||||||
| Cost of Revenue | ||||||||||||||||
| Costs of revenue | ||||||||||||||||
| Total | ||||||||||||||||
| Gross Profit | ||||||||||||||||
| Operating expenses | ||||||||||||||||
| Payroll and related expenses | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Professional and consulting fees | ||||||||||||||||
| Marketing and business development expense | ||||||||||||||||
| Bad debt expense | ||||||||||||||||
| Total | ||||||||||||||||
| Operating loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income (expense) | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Change in fair value of derivative liability | ( | ) | ||||||||||||||
| Loss on settlement of derivative liability | ( | ) | ||||||||||||||
| Loss on exchange transaction | ( | ) | ( | ) | ||||||||||||
| Loss on sale of equipment | ( | ) | ||||||||||||||
| Interest income | ||||||||||||||||
| Other income | ||||||||||||||||
| Total | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss per share | ||||||||||||||||
| Basic and diluted | $ | ( | ) | ( | ) | $ | ( | ) | $ | ( | ) | |||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic and diluted | ||||||||||||||||
The accompanying notes are an integral part of these condensed financial statements.
2
RenX Enterprises Corp. and Subsidiaries
Condensed Consolidated Statements of Changes in Stockholder’s Equity (Unaudited)
| Preferred Stock | Preferred Stock | Additional | Non- | Total | ||||||||||||||||||||||||||||||||||||
| Common Stock | (Series A) | (Series B) | Paid-in | Accumulated | controlling | Stockholder’s | ||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Interest | Equity | |||||||||||||||||||||||||||||||
| Balance at January 1, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||||||||||||||||
| Conversion of notes payable and accrued interest | ||||||||||||||||||||||||||||||||||||||||
| Exercise of prefunded warrant | ( | ) | ||||||||||||||||||||||||||||||||||||||
| Issuance of stock for debt issuance | ||||||||||||||||||||||||||||||||||||||||
| Forgiveness of related party debt | - | - | - | |||||||||||||||||||||||||||||||||||||
| Stock-based compensation | - | |||||||||||||||||||||||||||||||||||||||
| Deconsolidation of Sugar Phase | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | ( | ) | ||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | ||||||||||||||||||||||||||||||||||||||||
| Cash paid for stock split | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Issuance of warrants | - | - | - | |||||||||||||||||||||||||||||||||||||
| Issuance of common and preferred stock for acquisition of Resource | ||||||||||||||||||||||||||||||||||||||||
| Conversion of notes payable | ||||||||||||||||||||||||||||||||||||||||
| Issuance of stock for debt issuance | ||||||||||||||||||||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||||||||||||||||
| Preferred Stock | Preferred Stock | Preferred Stock | Additional | Total | ||||||||||||||||||||||||||||||||||||||||
| Common Stock | (Series A) | (Series B) | (Series C) | Paid-in | Accumulated | Stockholder’s | ||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||||||||||||||||||||
| Balance at January 1, 2026 | $ | $ | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||||||||||||||||||||
| Issuance of stock for warrant exercise | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Conversion of Series B preferred stock to common stock | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Series B preferred stock accrued dividends | - | - | - | - | ( | ) | ||||||||||||||||||||||||||||||||||||||
| Issuance of stock for services | ||||||||||||||||||||||||||||||||||||||||||||
| Conversion of Series A preferred stock to common stock | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Forgiveness of related party debt | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||
| Issuance of warrants for debt issuance | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Cash paid for stock split | ( | ) | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of warrants for debt issuance | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||
| Conversion of Series A preferred stock to common stock | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock for services | ||||||||||||||||||||||||||||||||||||||||||||
| Exchange of related party debt for Series C preferred stock and warrants | ||||||||||||||||||||||||||||||||||||||||||||
| Net loss | - | - | - | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | $ | $ | $ | $ | $ | $ | ( | ) | ||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed financial statements.
3
RenX Enterprises Corp. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
| For the Six Months Ended June 30, 2026 |
For the Six Months Ended June 30, 2025 |
|||||||
| (Unaudited) | (Unaudited) | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Change in fair value of derivative liability | ||||||||
| Loss on settlement of derivative liability | ||||||||
| Loss on exchange transaction | ||||||||
| Depreciation | ||||||||
| Amortization | ||||||||
| Bad debt expense | ||||||||
| Amortization of debt issuance costs | ||||||||
| Amortization of right of use asset | ||||||||
| Stock based compensation | ||||||||
| Impairment of intangible assets | ||||||||
| Loss on sale of equipment | ||||||||
| Common stock for services | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Account receivable | ( | ) | ( | ) | ||||
| Inventory | ( | ) | ||||||
| Prepaid assets and other current assets | ( | ) | ||||||
| Notes receivable | ||||||||
| Due to affiliates | ( | ) | ||||||
| Accounts payable and accrued expenses | ||||||||
| Operating lease liabilities | ( | ) | ( | ) | ||||
| Net cash (used in) provided by operating activities | ( | ) | ||||||
| Cash flows from investing activities: | ||||||||
| Additions to intangible assets | ( | ) | ||||||
| Cash received in acquisition | ||||||||
| Purchase of CIP materials | ( | ) | ||||||
| Proceeds from sale of property and equipment | ||||||||
| Purchase of property and equipment | ( | ) | ||||||
| Additions to equity based investments | ( | ) | ||||||
| Net cash (used in) provided by investing activities | ( | ) | ||||||
| Cash flows from financing activities: | ||||||||
| Debt issuance costs | ( | ) | ( | ) | ||||
| Payments on finance lease | ( | ) | ( | ) | ||||
| Cash paid from split | ( | ) | ||||||
| Proceeds from notes payable | ||||||||
| Principal payments on debt | ( | ) | ( | ) | ||||
| Cash payment of derivative liability | ( | ) | ||||||
| Net cash provided by (used in) financing activities | ( | ) | ||||||
| Net change in cash from continuing operations | ( | ) | ||||||
| Net cash provided by (used in) discontinued operations: | ||||||||
| Cash provided by operating activities | ||||||||
| Cash provided by investing activities | ||||||||
| Cash used in financing activities | ( | ) | ||||||
| Net cash provided by discontinued operations | ||||||||
| Net change in cash | ||||||||
| Cash – beginning of period | ||||||||
| Cash – end of period | $ | $ | ||||||
| Supplemental disclosure of non-cash operating activities: | ||||||||
| Forgiveness of related party accounts payable and accrued expenses | $ | $ | ||||||
| Issuance of stock for derivative liability settlement | $ | $ | ||||||
| Issuance of stock for warrant exercise | $ | $ | ||||||
| Conversion of Series A preferred stock to common stock | $ | $ | ||||||
| Conversion of notes payable and accounts payable and accrued expenses for Series C preferred stock and warrants | $ | $ | ||||||
| Deferred gain on sale from sale of equity investment | $ | |||||||
| Forgiveness of amounts due from affiliates | $ | $ | ||||||
| Issuance of warrants for debt issuance | $ | $ | ||||||
| Conversion of notes payable | $ | $ | ||||||
| Pre-funded warrants | $ | $ | ||||||
The accompanying notes are an integral part of these condensed financial statements.
4
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 1. | Description of Business |
RenX Enterprises Corp. (the “Company” or “RenX”) is a vertically integrated, full-service operator in the engineered soils and organic recycling industry, operating through Resource Group US Holdings LLC (“Resource Group”), which the Company acquired in June 2025 in a transaction that marked a significant strategic shift in the Company’s core business. The Company, through its subsidiaries, centers its operations on the transformation of targeted organic green waste materials into environmentally friendly soil and mulch products. Through its subsidiary, Zimmer Equipment Inc. (“ZEI”), the Company provides comprehensive waste logistics and collection services for its own products as well as for products of third parties through ZEI’s owned fleet of high-capacity transportation equipment and third-party contractors engaged by ZEI. ZEI offers year-round collection and disposal services through high-capacity grapple trucks, open-top walking floor trailers, and variable-sized containers serving green waste generators, landscaping companies, golf courses, communities, and municipalities. Resource Group works with ZEI to streamline operations by internalizing certain transportation services, reducing over-the-road mileage, lowering disposal costs, and maximizing efficiency. The Company also continues to seek to monetize its legacy real estate assets and joint venture interests.
The Company is a Delaware corporation, originally formed in 2021 under the name SGB Development Corp. to engage in real property development using purpose-built, prefabricated modules constructed from both wood and steel. From its inception through 2023, the Company’s operations primarily focused on the acquisition, entitlement, and development of residential properties in high-growth markets across the United States, including direct acquisitions of land, strategic investments in real estate entities, and joint venture partnerships targeting green, single-family and multifamily housing projects. In 2023 and early 2024, the Company expanded that strategy by investing in real estate-related artificial intelligence (“AI”) technologies and entering into additional joint ventures in the Southern Texas market aimed at developing sustainable single-family housing. Following the strategic shift described above, the Company is no longer pursuing real estate-related AI activities, and the Company has announced plans to monetize its legacy real estate holdings by selling properties where third-party appraisals indicate meaningful value appreciation, with proceeds to be reinvested in its current operations. In December 2025, the Company changed its name to RenX Enterprises Corp. to reflect its new strategic direction.
The Company operates in three segments: compost sales, logistics, and real estate development
Going Concern
The Company began operations during 2021 and has incurred net losses since inception and has an accumulated deficit, which raises substantial doubt about its ability to continue as a going concern. As of June 30, 2026, the Company has an accumulated deficit of $
Reverse Stock Split
On October 8, 2024, the Company effected a
On March 26, 2026, the Company effected a second
All share and per share amounts set forth in the condensed consolidated financial statements of the Company have been retroactively restated to reflect the 2024 Stock Split and 2026 Stock Split as if they had occurred as of the earliest period presented and unless otherwise stated, all other share and per share amounts for all periods presented in this Quarterly Report on Form 10-Q for the six months ended June 30, 2026 have been adjusted to reflect the reverse stock splits effected in October 2024 and March 2026.
5
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 2. | Summary of Significant Accounting Policies |
Basis of presentation and principles of consolidation — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to the Quarterly Report on Form 10-Q and Article 8 Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. The unaudited condensed consolidated financial statements and notes should be read in conjunction with the audited condensed consolidated financial statements and notes for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on April 1, 2026. In the opinion of management, all adjustments, consisting of normal accruals, considered necessary for a fair presentation of the interim financial statements have been included. Results for the six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, LV Peninsula Holding, LLC (“LV Holding”), MyVonia Innovations LLC (“MyVonia LLC”), Resource Group, Resource Group US LLC (“Resource”), Zimmer Equipment Inc. (“ZEI”) and ETS Realty 1, LLC (“ETS”), as well as Sugar Phase I LLC (“Sugar Phase”) and Pulga Internacional LLC (“Pulga”) (until the time of deconsolidation).
Recently adopted accounting pronouncements — New accounting pronouncements implemented by the Company are discussed below or in the related notes, where appropriate.
Accounting estimates — The preparation of 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 financial statements and the reported amount of expenses during the reporting period. Actual results could differ from those estimates.
Revenue recognition — The Company determines, at contract inception, whether it will transfer control of a promised good or service over time or at a point in time, regardless of the length of contract or other factors. The recognition of revenue aligns with the timing of when promised goods or services are transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. To achieve this core principle, the Company applies the following five steps in accordance with its revenue policy:
| (1) | Identify the contract with a customer |
| (2) | Identify the performance obligations in the contract |
| (3) | Determine the transaction price |
| (4) | Allocate the transaction price to performance obligations in the contract |
| (5) | Recognize revenue as performance obligations are satisfied |
The revenue the Company has generated has resulted primarily from the sale of materials (compost, engineered soils, and mulch) as well as the collection and disposal services of waste, which at times, is produced into saleable materials. Such revenue is recognized at the point in time when control of the product transfers to the customer, which typically occurs upon delivery or customer pickup at the Company’s facility. For revenue from commissions related to residential real estate purchased and sales transactions, the Company applies recognition of revenue when the customer obtains control over such service, which is at a point in time.
Revenue from the sale of materials amounted to $
Revenue from the sale of materials amounted to $
6
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 2. | Summary of Significant Accounting Policies (cont.) |
Accounts receivable and allowance for credit losses — Accounts receivable are receivables generated from sales to customers. Amounts included in accounts receivable are deemed to be collectible within the Company’s operating cycle. The Company recognizes accounts receivable at invoiced amounts.
The Company adopted ASC 326, Current Expected Credit Losses, on January 1, 2023, which requires the measurement and recognition of expected credit losses using a current expected credit loss model. The allowance for credit losses on expected future uncollectible accounts receivable is estimated considering forecasts of future economic conditions in addition to information about past events and current conditions.
The allowance for credit losses reflects the Company’s best estimate of expected losses inherent in the accounts receivable balances. Management provides an allowance for credit losses based on the Company’s historical losses, specific customer circumstances, and general economic conditions. Periodically, management reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables when all attempts to collect have been exhausted and the prospects for recovery are remote. Recoveries are recognized when they are received. Actual collection losses may differ from the Company’s estimates and could be material to its consolidated financial position, results of operations, and cash flows. As of June 30, 2026 and December 31, 2025, the Company’s allowance for credit losses amounted to $
Inventory — Inventory consists of dirt, sand, mulch and compost. The Company’s inventory is valued at the lower of cost (first-in, first-out method) or net realizable value, and consists of all finished goods. As of June 30, 2026 and December 31, 2025 there was inventory of $
Variable Interest Entities — The Company accounts for certain legal entities as variable interest entities (“VIE”). When evaluating a VIE for consolidation, the Company must determine whether or not there is a variable interest in the entity. Variable interests are investments or other interests that absorb portions of an entity’s expected losses or receive portions of the entity’s expected returns. If it is determined that the Company does not have a variable interest in the VIE, no further analysis is required and the VIE is not consolidated. If the Company holds a variable interest in a VIE, the Company consolidates the VIE when there is a controlling financial interest in the VIE and therefore are deemed to be the primary beneficiary. The Company is determined to have a controlling financial interest in a VIE when it has both the power to direct the activities of the VIE that most significantly impact the VIE economic performance and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to that VIE. This determination is evaluated periodically as facts and circumstances change.
7
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 2. | Summary of Significant Accounting Policies (cont.) |
Investment Entities — The Company obtained a
During the six months ended June 30 2026 and 2025, Norman Berry did not have any material earnings or losses as the investments are in development. In addition, management believes there was impairment as of June 30, 2026 and December 31, 2025.
Property, plant and equipment — Property, plant and equipment is stated at cost. Depreciation is computed using the straight-line method over the estimated lives of each asset. Repairs and maintenance are charged to expense when incurred. Included in property, plant and equipment, are recoverable reserves acquired in connection with the Resource acquisition described below. Such reserves represent the approximately
Intangible assets — Intangible assets consist of $
Project Development Costs — Project development costs are stated at cost. At June 30, 2026 and December 31, 2025, the Company’s project development costs are expenses incurred related to development costs on various projects that are capitalized during the period the project is under development.
8
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 2. | Summary of Significant Accounting Policies (cont.) |
Fair value measurements — Financial instruments, including accounts payable and accrued expenses are carried at cost, which the Company believes approximates fair value due to the short-term nature of these instruments. The short-term notes payable are carried at cost which approximates fair value due to corresponding market rates. Financial instruments, such as derivative liabilities are measured at fair value at each reporting date (see Note 6 for additional information).
Derivative liability — The Company evaluates all features contained in financing agreements to determine if there are any embedded derivatives that require separate accounting from the underlying agreement under ASC 815 – Derivatives and Hedging. An embedded derivative that requires separation is accounted for as a separate liability or asset from the host agreement. The separated embedded derivative is accounted for at fair market value, with changes in fair value recognized in the statements of operations within the other financing costs line item. The Company determined that certain features under the October Private Placement (See Note 10 — Stockholders’ Equity) qualified as an embedded derivative. The derivative was accounted for separately from the underlying Series B Preferred Stock and is accounted for at fair value.
Warrants — The Company reviews the terms of warrants to purchase its common stock to determine whether warrants should be classified as liabilities or stockholders’ equity in its condensed consolidated balance sheets. In order for a warrant to be classified in stockholders’ equity, the warrant must be (i) indexed to the Company’s equity and (ii) meet the conditions for equity classification. If a warrant does not meet the conditions for stockholders’ equity classification, it is carried on the condensed consolidated balance sheets as a warrant liability measured at fair value, with subsequent changes in the fair value of the warrant recorded in the condensed consolidated statements of operations. If a warrant meets both conditions for equity classification, the warrant is initially recorded, at its relative fair value on the date of issuance, in stockholders’ equity in the condensed consolidated balance sheets, and the amount initially recorded is not subsequently remeasured at fair value.
Income taxes — The Company accounts for income taxes utilizing the asset and liability approach. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxes generally represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Deferred taxes result from the differences between the financial and tax bases of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted.
The calculation of tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for anticipated tax audit issues based on the Company’s estimate of whether, and the extent to which, additional taxes will be due. If payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when the liabilities are no longer determined to be necessary. If the estimate of tax liabilities proves to be less than the ultimate assessment, a further charge to expense would result.
9
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 2. | Summary of Significant Accounting Policies (cont.) |
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, extending key provisions of the 2017 Tax Cuts and Jobs Act including, but not limited to, the restoration of
Business Combinations — The Company accounts for business acquisitions using the acquisition method of accounting in accordance with ASC 805 “Business Combinations”, which requires recognition and measurement of all identifiable assets acquired and liabilities assumed at their fair value as of the date control is obtained. The Company determines the fair value of assets acquired and liabilities assumed based upon its best estimates of the acquisition-date fair value of assets acquired and liabilities assumed in the acquisition. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired. Subsequent adjustments to fair value of any contingent consideration are recorded to the Company’s condensed consolidated statements of operations. Costs that the Company incurs to complete the business combination are charged to general and administrative expenses as they are incurred.
For acquisitions of assets that do not constitute a business, any assets and liabilities acquired are recognized at their cost based upon their relative fair value of all asset and liabilities acquired.
Recently Issued Accounting Pronouncements - In November 2024, the FASB issued ASU No. 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures.” This ASU requires that each interim and annual reporting period, an entity discloses more information about the components of certain expense captions that is currently disclosed in the financial statements. This update is effective for annual reporting periods beginning after December 15, 2026. Early adoption is permitted. Management is currently evaluating the effects this guidance will have on its financial statements.
| 3 | Property and Equipment |
Property and equipment are stated at cost less accumulated depreciation and amortization and depreciated using the straight-line method over their useful lives.
| 2026 | 2025 | Estimated Life | ||||||||
| Computer equipment and software | $ | $ | ||||||||
| Equipment | ||||||||||
| Reserves | ||||||||||
| Furniture and fixtures | ||||||||||
| Land improvements | ||||||||||
| Vehicles and trailer | ||||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||||
| Property, plant and equipment, net | $ | $ | ||||||||
| * |
Included in property and equipment is $
Depreciation expense for the three months ended June 30, 2026 and 2025 amounted to $
10
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 4. | Intangible Assets |
At June 30, 2026 and December 31, 2025 the Company’s intangible assets consisted of the following:
| 2026 | 2025 | |||||||
| Website costs | $ | $ | ||||||
| Trade name | ||||||||
| License agreement | ||||||||
| Less: accumulated amortization | ( | ) | ( | ) | ||||
| $ | $ | |||||||
Amortization expense for the three months ended June 30, 2026 and 2025 amounted to $
The following table represents the total estimated amortization of intangible assets for the succeeding years:
| Estimated | ||||
| amortization | ||||
| For the year ending December 31: | expense | |||
| 2026 (remaining) | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 and thereafter | ||||
| $ | ||||
| 5. | Equity-based investments |
As of June 30, 2026, the Company’s investment in Norman Berry amounted to $
| Balance sheet information: | June 30, 2026 | December 31, 2025 | ||||||
| (Unaudited) | (Audited) | |||||||
| Total assets | $ | $ | ||||||
| Total liabilities | $ | $ | ||||||
| Members’ equity | $ | $ | ||||||
11
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 6. | Fair Value Measurements |
The Company measures the fair value of financial assets and liabilities based on 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 on the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value.
The Company uses three levels of inputs that may be used to measure fair value:
Level 1 Quoted prices in active markets for identical assets or liabilities.
Level 2 Quoted prices for similar assets and liabilities in active markets or inputs that are observable.
Level 3 Inputs that are unobservable (for example, cash flow modeling inputs based on assumptions).
Transfer into and transfers out of the hierarchy levels are recognized as if they had taken place at the end of the reporting period. There have been no changes in Level 1, Level 2, and Level 3 and no changes in valuation. The fair value of the Company’s derivative liability was determined using significant unobservable measures and therefore classified as Level 3.
| Fair value measured as of June 30, 2026 | ||||||||||||||||
| Total at June 30, | Quoted prices in active markets | Significant other observable inputs | Significant unobservable inputs | |||||||||||||
| 2026 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
| Liabilities: | ||||||||||||||||
| Derivative liability | $ | $ | $ | $ | ||||||||||||
| Fair value measured as of December 31, 2025 | ||||||||||||||||
| Total at December 31, | Quoted prices in active markets | Significant other observable inputs | Significant unobservable inputs | |||||||||||||
| 2025 | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
| Liabilities: | ||||||||||||||||
| Derivative liability | $ | $ | $ | $ | ||||||||||||
The table below shows the inputs used to determine the fair value of the derivative liability:
| June 30, 2026 | December 31, 2025 | |||||||
| Risk-free interest rate | % | % | ||||||
| Market discount rate | % | % | ||||||
| Term | ||||||||
| Expected volatility | % | % | ||||||
12
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 6. | Fair Value Measurements (cont.) |
The following table sets forth a summary of the change in the fair value of the derivative liability that are measured at fair value on a recurring basis for the six months ended June 30, 2026
| Balance, as of December 31, 2025 | $ | |||
| Payments made * | ( | ) | ||
| Change in fair value | ||||
| Loss on settlement | ||||
| Balance, as of June 30, 2026 | $ |
| * |
| 7. | Notes Payable and Notes Payable – Related Party |
The following outlines the Company’s Notes Payable and Notes Payable – Related Party. Any related party notes payable are noted as such.
LV Note
On April 3, 2024, LV Holding, entered into a Modification and Extension Agreement, effective as of April 1, 2024 (the “Extension Agreement”), to extend to
The Company and Norman Berry entered into a Restructuring and Collateral Agreement, dated January 6, 2026 and effective as of December 31, 2025 (the “Restructuring Agreement”), with an institutional investor relating to the outstanding promissory note in the principal amount of approximately $
BCV
On November 10, 2025, the Company entered into a new Loan Agreement (the “New BCV Loan Agreement”) with a Luxembourg-based specialized investment fund, BCV Renew Earth (“BCV Renew Earth”), for up to $
13
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
1800 Diagonal
Between April and December 2025, the Company issued five promissory notes to 1800 Diagonal Lending LLC (“1800 Diagonal”), the Fifth through Ninth 1800 Diagonal Notes, in an aggregate original principal amount of $
Between December 2025 and June 2026, the Company issued three promissory notes in favor of 1800 Diagonal in the aggregate principal amount of $
As of June 30, 2026 the total principal balance of 1800 Diagonal Notes amounted to $
Cedar
On March 13, 2025, the Company entered into a Cash Advance Agreement (the “Cedar Cash Advance Agreement”) with Cedar Advance LLC (“Cedar”) pursuant to which the Company sold to Cedar $
14
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
On April 27, 2026, the Company refinanced a portion of its remaining obligations to Cedar by entering into a new Cash Advance Agreement (the “Cedar April 2026 Agreement”), pursuant to which the Company sold to Cedar $
Resource Group Note – Related Party
On June 2, 2025, the Company entered into an Amendment (the “Amendment”) to the Membership Interest Purchase Agreement, dated February 25, 2025 (the “Resource Group MIPA”), with Resource Group US Holdings LLC, a Florida limited liability company (“Resource Group”), and the members of Resource Group (the “Equityholders”). The Amendment altered the consideration to be paid by the Company to the Equityholders in connection with the purchase of
As of June 30, 2026, the principal balance amounted to $
Boot Capital
On December 15, 2025, the Company issued a promissory note (the “Boot Capital Note”) in favor of Boot Capital LLC in the principal amount of $
Sixth Borough Partners
On October 8, 2025, the Company issued a promissory note (the “Sixth Borough Note”) in favor of Sixth Borough Partners LLC in the principal amount of $
Peak One
On January 16, 2026, the Company entered into a Securities Purchase Agreement, dated January 16, 2026 (the “Peak One Agreement”), with an institutional investor (the “Peak Investor”), pursuant to which the Company received from the Peak Investor a debenture in the principal amount of $
15
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
February 2026 Private Placement
On February 12, 2026, the Company entered into a securities purchase agreement (the “February 2026 Purchase Agreement”) with institutional investors for the issuance and sale in a private placement transaction (the “February 2026 Private Placement”) of Senior Convertible Notes (“February 2026 Notes”) in the principal amounts of $
The February 2026 Private Placement closed on February 17, 2026. The net proceeds to the Company from the February 2026 Private Placement were approximately $
The February 2026 Notes mature 13 months from their date of issuance (subject to extension under certain circumstances), bear interest at a rate of
The February 2026 Notes are convertible, at the option of the holder, at any time after the date of issuance, into that number of shares of common stock equal to the principal amount of the February 2026 Notes, plus all accrued and unpaid interest and late charges and any other unpaid amounts, at the February 2026 Conversion Price of $
The February 2026 Notes are redeemable by the Company at any time, at the Company’s option, in whole or in part, at a redemption price equal to
The February 2026 Notes contain customary events of default. If an event of default occurs, from and after the occurrence, and during the continuance of, an such event of default, the interest rate of the February 2026 Notes shall automatically increase to
16
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
April 2026 Private Placement
On April 30, 2026, the Company entered into a securities purchase agreement (the “April 2026 Purchase Agreement”) with certain institutional investors related to a tranched private placement transaction (the “April 2026 Private Placement”) of Senior Convertible Notes (“April 2026 Notes”) and warrants (the “April 2026 Warrants”) to purchase shares of common stock as more particularly set forth below. Pursuant to the April 2026 Purchase Agreement, the Company (i) issued and sold to the purchasers, at the initial closing on May 4, 2026 (the “Initial Closing”), April 2026 Notes in the aggregate principal amount of $
The Initial Closing of the April 2026 Private Placement occurred on May 4, 2026 (the “Initial Closing Date”). The net proceeds to the Company from the Initial Closing of the April 2026 Private Placement was approximately $
17
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
The April 2026 Notes mature 12 months from their date of issuance (subject to extension under certain circumstances, bear interest at a rate of
The April 2026 Notes are initially convertible, at the option of the holder, at any time after the date of issuance, into that number of shares of common stock equal to the principal amount of the April 2026 Notes, plus all accrued and unpaid interest and late charges and any other unpaid amounts, at the Initial April 2026 Conversion Price of $
The Initial April 2026 Notes, without taking into account any accrued and unpaid interest, are initially convertible, at the option of the holder, into an aggregate of
The April 2026 Notes are redeemable by the Company at any time, at the Company’s option, in whole or in part, at a redemption price equal to
18
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
Related Party Note Exchange — Series C Convertible Preferred Stock
On June 9, 2026, the Amended and Restated Promissory Note, dated January 1, 2025, originally issued by the Company to MCS Lending, LLC, a related party, was assigned to Index Equity US, LLC, a related party (the “Debtholder”). On June 11, 2026, the Company entered into an exchange agreement with the Debtholder, which was amended on June 15, 2026 (as amended, the “Exchange Agreement”), pursuant to which the Company exchanged $
As of June 30, 2026 and December 31, 2025, notes payable consisted of the following:
| 2026 | 2025 | |||||||
| LV Note | $ | $ | ||||||
| 2nd Lien Note | ||||||||
| New BCV Loan Agreement | ||||||||
| 1800 Diagonal Notes | ||||||||
| Cedar Cash Advance Agreement | ||||||||
| Cedar April 2026 Agreement | ||||||||
| Boot Capital Note | ||||||||
| Sixth Borough Note | ||||||||
| Anson East Master Fund LP | ||||||||
| Anson Investment Master Fund LP | ||||||||
| Alto Opportunity Master Fund, SPC | ||||||||
| Member Note (related party) - $ | ||||||||
| Gail Baird Foundation – Mortgage note payable with an original principal amount of $ | ||||||||
| CCG Loan1 – Note payable with an original principal amount of $ | ||||||||
| CCG Loan 2 – Note payable with an original principal amount of $ | ||||||||
| CCG Loan 3 – Note payable with an original principal amount of $ | ||||||||
| CCG Loan 4 – Note payable with an original principal amount of $ | ||||||||
19
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
| CCG Loan 5 – Note payable with an original principal amount of $ | ||||||||
| John Deere Equipment – Note payable with an original principal amount of $ | ||||||||
| Loeb – Note payable with an original principal amount of $ | ||||||||
| Index Loan 2 (related party) – Note payable dated November 8, 2022 due on demand and interest rate of | ||||||||
| MCS (related party) – Note payable with an original principal amount of $ | ||||||||
| ZEI Seller Loan – Note payable with an original principal amount of $ | ||||||||
| Moorback 6600 STA – Note payable with an original principal amount of $ | ||||||||
| Blending Line STA – Note payable with an original principal amount of $ | ||||||||
| 911 Grapple Truck – Note payable with an original principal amount of $ | ||||||||
| Ford T350 – Note payable with an original principal amount of $ | ||||||||
| Allegiant Partners Incorporated - Note payable with an original principal amount of $ | ||||||||
| John Deere Equipment 2 - Note payable with an original principal amount of $ |
20
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
| John Deere Equipment 3 - Note payable with an original principal amount of $ | ||||||||
| John Deere Equipment 4 - Note payable with an original principal amount of $ | ||||||||
| John Deere Equipment 5 - Note payable with an original principal amount of $ | ||||||||
| First Insurance Funding – Note payable with an original principal amount of $ | ||||||||
| First Insurance Funding 2 – Note payable with an original principal amount of $ | ||||||||
| First Insurance Funding 3– Note payable with an original principal amount of $ | ||||||||
| MCA2-Unique Funding Solutions - Cash advance agreement dated May 6, 2025 with a maturity date of | ||||||||
| MCA3-CFG Merchant Solutions - Cash advance agreement dated June 20, 2025 with a maturity date of | ||||||||
| BMO Note payable – Note payable with an original principal amount of $ | ||||||||
| Huntington Note Payable – Note payable with an original amount of $ | ||||||||
| Xerox Copier Note Payable – Note payable with an original amount of $ | ||||||||
| PNC Equipment Finance – Note payable with an original amount of $ | ||||||||
| SMFL Note Payable – Note payable with an original amount of $ | ||||||||
| Verdant – Note payable with an original amount of $ | ||||||||
| MCA3-CFG Merchant Solutions - Cash advance agreement dated March 21, 2025 with a maturity date of | ||||||||
| MCA4 - Cedar Advance- Cash advance agreement dated June 16, 2025 with a maturity date of | ||||||||
| International HZ620 Loan - Note payable with an original principal amount of $ | ||||||||
| First Insurance Funding – ZEI - Note payable with an original principal amount of $ | ||||||||
| Total | ||||||||
| Less: debt discount and debt issuance costs | ( | ) | ( | ) | ||||
| Total debt | ||||||||
| Less: current maturities, net | ( | ) | ( | ) | ||||
| Long-term debt, net | $ | $ |
21
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 7. | Notes Payable and Notes Payable – Related Party (cont.) |
Scheduled maturities of notes payable is as follows for the succeeding years:
| 2026 (remaining) | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Less: debt discount and debt issuance costs | ( | ) | ||
| Total debt | ||||
| Less: current maturities | ( | ) | ||
| Long-term debt, net | $ |
For the three months ended June 30, 2026 and 2025, the Company recognized amortization of debt issuance costs and debt discount of $
| 8. | Business Combination and Acquisition of Assets |
On June 2, 2025, the Company completed the acquisition of Resource Group. Pursuant to the Amendment, the purchase price for the membership interests of Resource Group was amended to be comprised of (i) $
22
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 8. | Business Combination and Acquisition of Assets (cont.) |
The purchase consideration amounted to:
| Note payable | $ | |||
| Equity compensation | ||||
| $ |
The total equity compensation was valued as follows: common stock at the closing price upon acquisition which amounted to $
The following table summarizes the allocation of the purchase price to the assets acquired and liabilities assumed for the Resource Group Acquisition:
| Cash and cash equivalents | $ | |||
| Accounts receivable | ||||
| Inventory | ||||
| Prepaid expenses and other current assets | ||||
| Land | ||||
| Property and equipment | ||||
| Intangible assets and goodwill | ||||
| Right of use assets | ||||
| Accounts payable and accrued expenses | ( | ) | ||
| Due to affiliates | ( | ) | ||
| Notes payable | ( | ) | ||
| Operating lease liabilities | ( | ) | ||
| Finance lease liabilities | ( | ) | ||
| $ |
23
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 8. | Business Combination and Acquisition of Assets (cont.) |
The following unaudited pro forma consolidated results of operations for the three months ended June 30, 2025 assume the acquisition Resource Group was completed on January 1, 2024:
| For the Three Months Ended June 30, 2025 | ||||
| (Unaudited) | ||||
| Pro-forma total revenues | $ | |||
| Pro-forma net loss | $ | ( | ) | |
The following unaudited pro forma consolidated results of operations for the six months ended June 30, 2025 assume the acquisition Resource Group was completed on January 1, 2024:
| For the Six Months Ended June 30, 2025 | ||||
| (Unaudited) | ||||
| Pro-forma total revenues | $ | |||
| Pro-forma net loss | $ | ( | ) | |
24
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 9. | Net Loss Per Share |
Basic net loss per share is computed by dividing the net loss for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss for the period by the weighted average number of common and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares consist of the common shares issuable upon the exercise of stock options and warrants. Potentially dilutive common shares are excluded from the calculation if their effect is antidilutive.
At June 30, 2026, there were warrants to purchase
| 10. | Stockholder’s Equity |
As of June 30, 2026, the Company had
During the six months ended June 30, 2026, the Company issued
During the six months ended June 30, 2026, the Company issued
During the six months ended June 30, 2026, the Company forgave $
During the six months ended June 30, 2026, the Company issued warrants to purchase
During the six months ended June 30, 2026, in connection with the Exchange Agreement, the Company issued (i)
October Private Placement Agreement
On October 16, 2025, the Company entered into a securities purchase agreement (the “October Purchase Agreement”) with institutional investors for the issuance and sale in a private placement transaction (the “October Private Placement”) of
During the six months ended June 30, 2026,
25
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
Additionally, the Company recorded a derivative liability associated with certain embedded features in the Series B Preferred Stock. These instruments were classified as liabilities at fair value in accordance with ASC 815 due to their settlement provisions and other contractual terms. See below for a description of the terms of the Series B Preferred Stock. The Company measured its bifurcated embedded derivative liability at fair value on a recurring basis using level 3 inputs. These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. The derivative liability was measured using a Monte Carlo valuation model. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. The initial amount of the derivative liability amounted to $
Preferred Shares
Series A Preferred Stock – During the six months ended June 30, 2026,
Series B Preferred Stock - As of June 30, 2026, the Company had
26
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
Upon liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, each holder shall be entitled to receive the amount of cash, securities or other property to which such holder would be entitled to receive with respect to such shares of Series B Preferred Stock if such shares had been converted to common stock immediately prior to such liquidation (without giving effect for such purposes to the applicable beneficial ownership limitations), subject to the preferential rights of holders of any class or series of capital stock of the Company specifically ranking by its terms senior to the Series B Preferred Stock as to distributions of assets upon liquidation, dissolution or winding up of the Company, whether voluntarily or involuntarily.
Except as otherwise provided by the Certificate of Designation of the Series B Preferred Stock, or as otherwise required by the law, the Series B Preferred Stock shall have no voting rights. However, as long as any shares of Series B Preferred Stock are outstanding, the Company shall not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series B Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock or alter or amend the Certificate of Designation of the Series B Preferred Stock, (b) authorize or create any class of stock ranking as to dividends, redemption or distribution of assets upon a liquidation senior to, or otherwise pari passu with, the Series Preferred Stock, (c) amend its certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders, (d) increase the number of authorized shares of Series B Preferred Stock, or (e) enter into any agreement with respect to any of the foregoing.
On the mandatory conversion date, which is the five year anniversary of the issuance date (the “Series B Preferred Mandatory Conversion Date”), all outstanding shares of Series B Preferred Stock and, to the extent that the Company elects to pay dividends in shares of common stock, all accrued but unpaid dividends thereon through and including the Series B Preferred Mandatory Conversion Date shall be automatically converted into shares of common stock at the conversion price of $
Each share of Series B Preferred Stock shall be convertible, at any time and from time to time from and after the issuance date through the Series B Preferred Mandatory Conversion Date, at the option of the holder thereof, into a number of shares of common stock (subject to certain limitations) equal to the sum of (A) the quotient of (i) the aggregate stated value of those shares being converted, divided by (ii) the applicable conversion price, plus (B) to the extent that the Company elects to pay the Dividend Share Amount Payment and Make-Whole Payment in shares of common stock, the quotient of (X) the sum of all accrued but unpaid dividends thereon plus the Make-Whole Payment, divided by (Y) the Dividend Conversion Price. Holders shall effect conversions by providing the Corporation with the form of Notice of Conversion.
Series C Preferred Stock - As of June 30, 2026, the Company had
27
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
In the event of the liquidation, dissolution or winding-up of the Company, whether voluntarily or involuntarily, the holders of shares of Series C Preferred Stock will be entitled to receive an amount in cash per share of Series C Preferred Stock equal to 150% of the stated value of such shares prior and in preference to holders of shares of common stock and pari passu with the Company’s Series A Preferred Stock and Series B Preferred Stock.
Each share of Series C Preferred Stock is initially convertible, at the option of the holder thereof, at any time after the Company receives stockholder approval of the conversion thereof, at an initial conversion price of $
The Certificate of Designation provides that holders of shares of Series C Preferred Stock are entitled to vote on an as-converted basis alongside holders of common stock as a single class, subject to certain limitations. The Company and the Debtholder have contractually agreed that for voting purposes, the number of whole shares of Common Stock into which the shares of Series C Convertible Preferred Stock held are then convertible, the adjustment provisions for dilutive issuances shall be disregarded. In addition, as long as any shares of Series C Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then outstanding shares of Series C Preferred Stock, alter or change adversely the powers, preferences or rights given to the Series C Preferred Stock or alter or amend the Certificate of Designation of the Series C Preferred Stock, authorize or create any class of stock ranking as to dividends, redemption or distribution of assets upon a liquidation senior to, or otherwise pari passu with, the Series C Preferred Stock, amend its certificate of incorporation in any manner that adversely affects any rights of the holders of Series C Preferred Stock, increase the number of authorized shares of Stock Preferred Stock, declare dividends on or redeem junior securities while accrued dividends remain unpaid, enter into affiliate transactions exceeding $
The Certificate of Designation provides that holders of Series C Preferred Stock are entitled to redeem their shares after three years at a redemption price equal to
28
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
Warrants
In conjunction with the issuance of debentures issued in February and March 2024 to Peak One Opportunity Fund, L.P (“Peak One”), the Company issued warrants to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
In conjunction with the issuance of additional debentures issued to Peak One in April and May 2024, the Company issued warrants to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
In conjunction with the issuance of debentures sold and issued to certain investors (the “Arena Investors”), in August 2024, the Company issued warrants to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
29
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
In conjunction with the issuance of additional debentures to the Arena Investors in October 2024, the Company issued warrants to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
In conjunction with the issuance of additional debentures to the Arena Investors in April 2025, the Company issued warrants to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
In conjunction with the October Private Placement, the Company issued warrants to purchase an aggregate of
30
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
In conjunction with the February 2026 Purchase Agreement, the Company issued warrants to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % | |||
In conjunction with the April 2026 Private Placement, the Company issued warrants (the “Initial April 2026 Warrants”) to purchase an aggregate of
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
Pursuant to the Exchange Agreement with the Debtholder, the Company issued a common stock purchase warrant to purchase up to
| Risk-free interest rate | % | |||
| Contractual term | ||||
| Dividend yield | % | |||
| Expected volatility | % |
31
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 10. | Stockholder’s Equity (cont.) |
Warrant activity for the six months ended June 30, 2026 are summarized as follows:
| Weighted | ||||||||||||||||
| Average | ||||||||||||||||
| Weighted | Remaining | |||||||||||||||
| Average | Contractual | Aggregate | ||||||||||||||
| Number of | Exercise | Term | Intrinsic | |||||||||||||
| Warrants | Warrants | Price | (Years) | Value | ||||||||||||
| Outstanding and exercisable - January 1, 2026 | $ | |||||||||||||||
| Granted | ||||||||||||||||
| Exercised | ( | ) | ( | ) | ||||||||||||
| Outstanding and exercisable – June 30, 2026 | $ | |||||||||||||||
| 11. | Share-based Compensation |
On February 28, 2023, the Company’s Board of Directors approved the issuance of up to
32
RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 12. | Leases |
The Company leases various equipment under non-cancellable operating lease agreements. The leases have remaining lease terms ranging from approximately
Supplemental balance sheet information related to leases is as follows:
| Balance Sheet Location | June 30, 2026 | |||||
| Operating Leases | ||||||
| Right-of-use assets | $ | |||||
| Current liabilities | ||||||
| Non-current liabilities | ||||||
| Total operating lease liabilities | $ | |||||
| Weighted Average Remaining Lease Term | ||||||
| Operating leases | ||||||
| Weighted Average Discount Rate | ||||||
| Operating leases | % | |||||
The Company also leases various equipment under non-cancellable lease agreements, which have been determined to be finance leases. The leases have remaining lease terms ranging from approximately
Supplemental balance sheet information related to leases is as follows:
| Balance Sheet Location | June 30, 2026 | |||||
| Finance Leases | ||||||
| Right-of-use assets (included in property and equipment) | $ | |||||
| Current liabilities | ||||||
| Non-current liabilities | ||||||
| Total finance lease liabilities | $ | |||||
| Weighted Average Remaining Lease Term | ||||||
| Finance leases | ||||||
| Weighted Average Discount Rate | ||||||
| Finance leases | % | |||||
As the leases do not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments, which is reflective of the specific term of the leases and economic environment of each geographic region.
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RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 12. | Leases (cont.) |
Anticipated future lease costs, which are based in part on certain assumptions to approximate minimum annual rental commitments under non-cancellable leases, are as follows:
| 2026 (remaining) | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total lease payments | ||||
| Less: Imputed interest | ( | ) | ||
| Present value of lease liabilities | $ |
| 13. | Related Party Transactions |
As of June 30, 2026 and December 31, 2025, the Company had $
As of June 30, 2026 and December 31, 2025, the Company had $
As disclosed in Note 7, the Company had notes payable to related parties of $
As disclosed in Note 7, on June 11, 2026, the Company entered into the Exchange Agreement with the Debtholder, a related party, pursuant to which the Company exchanged $
The Company incurred consulting fees from Marc Brune, father of Nicolai Brune, Chief Financial Officer, in the amount of $
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RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 13. | Related Party Transactions (cont.) |
The Company incurred consulting fees payable to JDB Consulting Services, Inc., a company controlled by James D. Burnham, who served as a member of the Company’s Board of Directors until July 1, 2026, in the amount of $
The Company incurred consulting fees payable to AMC Environmental Consulting., a company controlled by Anthony M. Cialone, who serves as a member of the Company’s Board of Directors, in the amount of $
The Company employs Tristan Burnham, son of James D. Burnham, and incurred payroll expenses of $
The Company employs Derek Villarreal, son of David Villarreal, Chief Executive Officer, and incurred payroll expenses of $
As part of the acquisition of Resource Group, the Company acquired an intangible asset in the amount of $
| 14. | Commitments and Contingencies |
At times the Company may be subject to certain claims and lawsuits arising in the normal course of business. The Company will assess liabilities and contingencies in connection with outstanding legal proceedings utilizing the latest information available. Where it is probable that the Company will incur a loss and the amount of the loss can be reasonably estimated, the Company will record a liability in our condensed consolidated financial statements. These legal accruals may be increased or decreased to reflect any relevant developments on a quarterly basis. Where a loss is not probable or the amount of the loss is not estimable, the Company will not record an accrual, consistent with applicable accounting guidance. The Company is not currently involved in any material legal proceedings.
| 15. | Segment Reporting |
The Company’s Chief Operating Decision Maker (“CODM”) as defined under GAAP, who is the Company’s , determined that the Company organized its operations into
| Real Estate Development | Technology | Compost Sales | Logistics | Consolidated | ||||||||||||||||
| For the Six Months Ended June 30, 2026 | ||||||||||||||||||||
| Revenue | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenue | ||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Payroll and related expenses | ||||||||||||||||||||
| Professional and consulting fees | ||||||||||||||||||||
| Other operating expenses | ||||||||||||||||||||
| Total operating expenses | ||||||||||||||||||||
| Operating (loss) income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Other income (expense) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net (loss) income | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | |||||||
| Total assets | $ | $ | $ | $ | $ | |||||||||||||||
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RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 15. | Segment Reporting (cont.) |
| Real Estate Development | Technology | Compost Sales | Logistics | Consolidated | ||||||||||||||||
| For the Three Months Ended June 30, 2026 | ||||||||||||||||||||
| Revenue | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenue | ||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Payroll and related expenses | ||||||||||||||||||||
| Professional and consulting fees | ||||||||||||||||||||
| Other operating expenses | ||||||||||||||||||||
| Total operating expenses | ||||||||||||||||||||
| Operating (loss) income | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Other income (expense) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Net (loss) income | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | |||||||||
| Total assets | $ | $ | $ | $ | $ | |||||||||||||||
| Real Estate Development | Technology | Compost Sales | Logistics | Consolidated | ||||||||||||||||
| For the Six Months Ended June 30, 2025 | ||||||||||||||||||||
| Revenue | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenue | ||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Payroll and related expenses | ||||||||||||||||||||
| Professional fees and consulting fees | ||||||||||||||||||||
| Other operating expenses | ||||||||||||||||||||
| Bad debt expense | ||||||||||||||||||||
| Total operating expenses | ||||||||||||||||||||
| Operating (loss) income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Other income (expense) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||
| Total assets | $ | $ | $ | $ | $ | |||||||||||||||
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RenX Enterprises Corp.
Notes to Financial Statements
For the Six Months Ended June 30, 2026 and 2025
| 15. | Segment Reporting (cont.) |
| Real Estate Development | Technology | Compost Sales | Logistics | Consolidated | ||||||||||||||||
| For the three Months Ended June 30, 2025 | ||||||||||||||||||||
| Revenue | $ | $ | $ | $ | $ | |||||||||||||||
| Cost of revenue | ||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Payroll and related expenses | ||||||||||||||||||||
| Professional fees and consulting fees | ||||||||||||||||||||
| Other operating expenses | ||||||||||||||||||||
| Bad debt expense | ||||||||||||||||||||
| Total operating expenses | ||||||||||||||||||||
| Operating (loss) income | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Other income (expense) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||||
| Total assets | $ | $ | $ | $ | $ | |||||||||||||||
| 16. | Subsequent Events |
July 2026 Management Changes
On July 1, 2026, James D. Burnham notified the Company of his decision to resign, effective as of such date, from his position as a member of the Company’s Board of Directors. Mr. Burnham’s resignation was not related to any disagreement with the Company on any matter relating to its operations, policies or practices. In connection with his resignation, effective July 1, 2026, the Company entered into an employment agreement with Mr. Burnham, pursuant to which Mr. Burnham serves as the Company’s Director of Growth & M&A for an initial one-year term, subject to automatic one-year renewals unless either party provides notice of non-renewal at least 30 days prior to the expiration of the then-current term, at an annual base salary of $
April 2026 Private Placement — Status of Second Closing
On July 13, 2026, the Company filed Amendment No. 2 to its registration statement on Form S-3 (Registration No. 333-295970) (as so amended, the “Initial April 2026 Registration Statement”), which, as amended, registers the resale of up to
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Introduction and Certain Cautionary Statements
As used in this Quarterly Report on Form 10-Q, unless the context requires otherwise, references to the “Company,” “RENX,” “we,” “us,” and “our” refer to RenX Enterprises Corp. and its subsidiaries. The following discussion and analysis of the financial condition and results of our operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes and schedules included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements for the years ended December 31, 2025 and 2024 and the accompanying notes, which are included in our Annual Report for the year ended December 31, 2025 filed with the Securities and Exchange Commission on April 1, 2026 (the “2025 10-K”). This discussion, particularly information with respect to our future operations, includes forward-looking statements that involve risks and uncertainties as described under the heading “Special Note Regarding Forward-Looking Statements” in this Quarterly Report on Form10-Q. You should review the disclosure under the heading “Risk Factors” in this Quarterly Report on Form 10-Q and the 2025 10-K for a discussion for important factors that could cause our actual results to differ materially from those anticipated in these forward-looking statements.
Special Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed in the forward-looking statements. The statements contained in this Quarterly Report on Form 10-Q that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements contained in this Quarterly Report on Form 10-Q may use forward-looking terminology, such as “anticipates,” “believes,” “could,” “would,” “estimates,” “may,” “might,” “plan,” “expect,” “intend,” “should,” “will,” or other variations on these terms or their negatives. All statements other than statements of historical facts are statements that could potentially be forward-looking. We caution that forward-looking statements involve risks and uncertainties, and actual results could differ materially from those expressed or implied in these forward-looking statements or could affect the extent to which a particular objective, projection, estimate or prediction is realized. These statements are based on the beliefs and assumptions of our management based on information currently available to management. Such forward-looking statements are subject to risks, uncertainties and other important factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified below, those discussed in the section titled “Risk Factors” included under Part II, Item 1A below and those discussed in the section titled “Risk Factors” included under Part I, Item 1A in the 2025 Form 10-K. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statement.
Although we believe that our assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the forward-looking statements included in this Quarterly Report on Form 10-Q will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the objectives and plans of ours will be achieved. Investors are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date on which such statements are made. Any forward-looking statements made by us or on our behalf speak only as of the date they are made, and we do not undertake to update any forward-looking statement that may be made from time to time on our behalf.
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Overview
We are a vertically integrated, full-service operator in the engineered soils and organic recycling industry, operating through Resource Group US Holdings LLC (“Resource Group”), which we acquired in June 2025 in a transaction that marked a significant strategic shift in our core business. Resource Group, through its subsidiaries, centers its operations on the transformation of targeted organic green waste materials into environmentally friendly soil and mulch products. Through our subsidiary, Zimmer Equipment Inc. (“ZEI”), we provide comprehensive waste logistics and collection services for our own products as well as for products of third parties through ZEI’s owned fleet of high-capacity transportation equipment and third-party contractors engaged by us. ZEI offers year-round collection and disposal services through high-capacity grapple trucks, open-top walking floor trailers, and variable-sized containers serving green waste generators, landscaping companies, golf courses, communities, and municipalities. Resource Group works with ZEI to streamline operations by internalizing certain transportation services, reducing over-the-road mileage, lowering disposal costs, and maximizing efficiency.
In addition to our organics processing and logistics operations, we are in the process of implementing the Microtec UTM 1200 Turbo Mill system at our Myakka City facility. The UTM 1200 is a high-efficiency milling and processing technology designed to enhance the throughput and output quality of our existing organics processing operations, including the production of engineered soils and mulch products. The mill shipped from Germany in August 2026 and is in transit to the United States, with arrival expected in the third quarter of 2026 and commissioning targeted for the second half of 2026, and site preparation at Myakka City, including foundations and utility infrastructure, is substantially advanced. Phase 1 deployment is targeted for 2026 and is expected to meaningfully expand processing capacity at Myakka City. There can be no assurance that the UTM 1200 system will be deployed on the anticipated timeline or that it will perform as expected upon installation.
We currently operate in three segments: compost sales, logistics, and real estate development. For the quarter ended June 30, 2026, we operated in three segments and generated $4,255,906 in revenue, of which approximately $3,207,133 was generated from our logistics business and $1,048,773 was generated from our compost sales business. While our logistics business operated by our subsidiary, ZEI, and our compost sales business operated by our subsidiary, Resource Group, are expected to serve as our primary operational focuses going forward, we also currently intend to continue to try to monetize our legacy real estate assets and joint venture interests.
Market Opportunity and Growth Strategy
We believe the market backdrop for organics recycling provides a durable tailwind for our business. State and local governments are increasingly adopting organics-diversion requirements and restrictions on the landfilling of green waste, expanding the feedstock available to permitted processors, while demand for engineered soils, mulch, compost and organic growing media continues to grow across agricultural, commercial, landscaping and infrastructure end markets. In particular, domestically produced, waste-derived substrates are increasingly preferred by commercial and municipal buyers over imported and mined alternatives, such as Canadian sphagnum peat, virgin topsoil and imported bark products, reflecting supply-chain disruptions, rising import costs and tariffs on imported inputs, and procurement mandates favoring recycled-content materials.
With that in mind, we are developing our permitted Myakka City, Florida facility into what we believe will be a differentiated organic substrate production platform. The planned deployment of the UTM 1200 system described above is designed to move our output beyond bulk mulch and compost into consistent, specification-grade engineered soils and organic growing substrates, including growing media formulated to serve as a domestically produced replacement for imported sphagnum peat-based products. Permitted organics processing facilities face significant barriers to entry, including capital intensity, land requirements and regulatory complexity, and our platform combines the permitted site and approximately 9 million tons of entitled sand reserves acquired in connection with the Resource Group acquisition with ZEI’s collection and logistics network, which helps secure feedstock supply and internalize transportation costs, allowing us to source raw organic material, process it and deliver finished products within a single vertically integrated system.
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Our two primary operating segments, compost sales and logistics, carry complementary margin profiles: for the six months ended June 30, 2026, our compost sales segment generated a gross margin of approximately 64%, while our logistics segment generated a gross margin of approximately 23%. As our compost sales and substrate production business grows relative to our logistics business, we believe this segment mix has the potential to expand our consolidated gross margin over time. Revenue for the quarter ended June 30, 2026 of $4,255,906 represented an increase of approximately 7.5% over revenue of $3,958,124 for the quarter ended March 31, 2026, with sequential growth in both our logistics and compost sales segments. Our growth strategy contemplates organic expansion, including increased processing throughput and new substrate products at Myakka City and expanded collection and logistics services, and we may from time to time evaluate acquisitions or investments that complement our vertically integrated platform. Any such expansion will require additional capital and is subject to the risks described under “Item 1A. Risk Factors” in this Quarterly Report and in our Annual Report on Form 10-K for the year ended December 31, 2025.
Company History
We were formed as a Delaware corporation in 2021 under the name SGB Development Corp. and, prior to our June 2025 acquisition of Resource Group, focused primarily on residential real property development and related real estate investments. In December 2025, we changed our name to RenX Enterprises Corp. to reflect our new strategic direction. See Note 1 — Description of Business for additional background.
Recent Developments
Nasdaq Minimum Bid Price Deficiency
On January 26, 2026, we received written notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying us that our common stock had failed to maintain the minimum $1.00 closing bid price required by Nasdaq Listing Rule 5550(a)(2) for the preceding 30 consecutive business days. On April 10, 2026, we received written notice that we had regained compliance with that rule, resolving the deficiency.
February 2026 Private Placement
On February 12, 2026, we entered into a securities purchase agreement (the “February 2026 Purchase Agreement”) with certain institutional investors (the “February 2026 Purchasers”) for the sale in a private placement transaction (the “February 2026 Private Placement”) of senior convertible notes (the “February 2026 Notes”) in the aggregate principal amount of $6,042,985.39. The February 2026 Notes bear interest at 12% per annum, mature 13 months from issuance, are payable in ten monthly installments equal to 110% of one-tenth of the principal amount plus accrued interest (the first of which payments became due and payable on July 14, 2026), and are convertible into shares of Company common stock, par value $0.001 per share (“Common Stock”), at a conversion price of $5.62 per share. In connection with the February 2026 Private Placement, we also issued the February 2026 warrants (collectively, the “February 2026 Warrants”) to purchase an aggregate of 1,937,599 shares of Common Stock, at an exercise price of $3.1188 per share, of which (i) warrants to purchase 1,075,264 shares of Common Stock (the “First February Warrants”) were exercisable immediately upon issuance and (ii) warrants to purchase 862,335 shares of Common Stock (the “Second February Warrants”) became exercisable upon receipt of stockholder approval of the exercise thereof, which was obtained at our 2026 Annual Meeting held on June 12, 2026. The February 2026 Private Placement closed on February 17, 2026, and we received net proceeds of approximately $5.4 million after deducting placement agent fees and offering expenses. See Note 7 — Notes Payable and Notes Payable – Related Party for a complete description of the February 2026 Private Placement.
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March 2026 Reverse Stock Split
On March 25, 2026, we filed a Certificate of Amendment to our Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a 1-for-20 reverse stock split of our common stock (the “Reverse Stock Split”), which became effective at 12:01 a.m. Eastern Time on March 26, 2026. Our common stock began trading on a split-adjusted basis on The Nasdaq Capital Market on March 26, 2026 under a new CUSIP number 78637J 402. The Reverse Stock Split reduced the number of our outstanding shares of common stock from approximately 50,000,000 shares to approximately 2,507,537 shares. Proportional adjustments were made to the number of shares of common stock issuable upon exercise or conversion of our outstanding equity awards and warrants, as well as the applicable exercise and conversion prices. Except as otherwise indicated, all share and per share amounts in this Quarterly Report on Form 10-Q have been retroactively adjusted to give effect to the Reverse Stock Split.
April 2026 Private Placement
On April 30, 2026, we entered into a securities purchase agreement (the “April 2026 Purchase Agreement”) with certain institutional investors providing for a tranched private placement transaction (the “April 2026 Private Placement”) of senior convertible notes (the “April 2026 Notes”) and warrants (“April 2026 Warrants”) to purchase shares of Common Stock, consisting of: (i) April 2026 Notes in the aggregate principal amount of $6,300,000 (the “Initial April 2026 Notes”) and April 2026 Warrants to purchase 3,917,099 shares of Common Stock (the “Initial April 2026 Warrants”), issued at the initial closing on May 4, 2026 (the “Initial Closing”), for net proceeds of approximately $5.7 million; (ii) April 2026 Notes in the aggregate principal amount of $6,700,000 (the “Second April 2026 Notes”) and April 2026 Warrants to purchase 4,165,805 shares of Common Stock (the “Second April 2026 Warrants”), to be issued in a second closing (the “Second Closing”) promptly following effectiveness of a registration statement (the “Initial April 2026 Registration Statement”) registering the shares of Common Stock issuable upon conversion of the Initial April 2026 Notes and the Second April 2026 Notes, in each case calculated based on the initial conversion price of $2.895, and the shares of Common Stock issuable upon exercise of the Initial April 2026 Warrants and the Second April 2026 Warrants, with expected net proceeds of approximately $6.4 million, which we have agreed to apply to the repayment of the February 2026 Notes at 110% of their outstanding principal amount; and (iii) up to $87,000,000 of additional April 2026 Notes and related warrants at additional closings (“Additional Closings”), subject to mutual consent and certain conditions, as to which no assurance can be given.
The April 2026 Notes are initially convertible, at the option of the holder, at any time after the date of issuance, into that number of shares of Common Stock equal to the principal amount of the April 2026 Notes, plus all accrued and unpaid interest and late charges and any other unpaid amounts, at the Initial April 2026 Conversion Price of $2.895 per share, subject to adjustment for any stock splits, stock dividends, recapitalizations and similar events. Subject to the receipt of stockholder approval, which was obtained at our 2026 Annual Meeting on June 12, 2026, the holders of the April 2026 Notes shall have the right, at any time after the later of (i) the date of the receipt of the stockholder approval and (ii) 120 calendar days following the Initial Closing Date, to convert their April 2026 Notes or any portion thereof into shares of Common Stock (an “Alternate Conversion”) at a conversion price equal to the greater of (x) a floor price of $0.534 (which is equal to 20% of the Nasdaq Minimum Price applicable to the Initial Notes) (the “April 2026 Note Floor Price”) and (y) 92% of the lowest volume weighted average price in the ten trading days prior to the date of such Alternate Conversion. See Note 7 — Notes Payable and Notes Payable – Related Party for a complete description of the April 2026 Private Placement.
The Initial Closing of the April 2026 Private Placement occurred on May 4, 2026 (the “Initial Closing Date”). The net proceeds to us from the Initial Closing were approximately $5.7 million, after deducting placement agent fees and the payment of other offering expenses associated with the offering that were payable by us. The April 2026 Purchase Agreement provided that Second Closing should occur promptly after effectiveness of the Initial April 2026 Registration Statement registering the Initial April 2026 Conversion Shares and the Second April 2026 Conversion Shares, in each case calculated based on the Initial April 2026 Conversion Price, and the Initial April 2026 Warrant Shares and the Second April 2026 Warrant Shares. Pursuant to the April 2026 Purchase Agreement, we agreed to use the net proceeds from the Second Closing, expected to be approximately $6.4 million, for the repayment of February 2026 Notes, in an amount equal to 110% of the outstanding aggregate principal amount of such February 2026 Notes. Subject to the satisfaction of certain closing conditions, including the mutual agreement of the purchasers and us, Additional Closings for an aggregate of up to $87,000,000 may occur from time to time after the Second Closing. There can be no assurance that any Additional Closings will occur.
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At the 2026 Annual Meeting, our stockholders approved, pursuant to Nasdaq Listing Rule 5635(d), the issuance of up to 26,779,029 shares of Common Stock upon conversion of the Initial April 2026 Notes and the Second April 2026 Notes and of up to an additional 179,213,485 shares of Common Stock upon conversion of Additional April 2026 Notes (in each case assuming that such notes accrue interest at 10% for a period of 12 months and that the conversion price is reduced to the floor price provided for in the April 2026 Notes). As a result of such approvals, commencing 120 calendar days following the date that the Initial April 2026 Notes were issued (September 1, 2026), the holders of outstanding Initial April 2026 Notes shall have the right to complete an Alternate Conversion at the Alternate Conversion Price equal to the greater of (x) the April 2026 Note Floor Price and (y) 92% of the lowest VWAP in the ten trading days prior to the date of such Alternate Conversion.
We filed the Initial April 2026 Registration Statement with the SEC on May 15, 2026, and amended it on each of June 22, 2026 and July 13, 2026, in which amendment we removed shares of Common Stock issuable upon conversion of the Second April 2026 Notes and Second April 2026 Warrants in response to comments received from the SEC. The Initial April 2026 Registration Statement was declared effective by the SEC on August 5, 2026; however, as of the date of this Quarterly Report, neither the Second Closing nor any Additional Closing has occurred, and no February 2026 Notes have been repaid with the proceeds of the April 2026 Private Placement.
June 2026 Related Party Debt Exchange
On June 11, 2026, we entered into an exchange agreement with Index Equity US, LLC, a related party (the “Debtholder”), which was amended on June 15, 2026 (as amended, the “Exchange Agreement”), pursuant to which we exchanged $7,169,072.79 of principal and accrued interest outstanding (the “Outstanding Debt”) under an Amended and Restated Promissory Note, dated January 1, 2025, originally issued by us to MCS Lending, LLC, a related party, and assigned to the Debtholder on June 9, 2026, for (i) 7,169 shares of a newly designated series of Series C Convertible Preferred Stock, par value $0.001 per share (“Series C Preferred Stock”), and with a stated value of $1,000.00 per share, initially convertible, at the option of the holder, into an aggregate of 2,476,338 shares of Common Stock at an initial conversion price of $2.895 per share, and (ii) a common stock purchase warrant to purchase up to 619,084 shares of Common Stock at an initial exercise price of $2.895 per share, in each case subject to adjustment, stockholder approval (to the extent required under the applicable rules of Nasdaq) and certain beneficial ownership limitations. On June 11, 2026, we issued the shares of Series C Preferred Stock and such warrant to the Debtholder, and the Outstanding Debt was cancelled. Bjarne Borg, a member of our Board of Directors, is the manager of the Debtholder.
The terms of the Series C Preferred Stock are set forth in a Certificate of Designation filed with the Secretary of State of the State of Delaware on June 10, 2026. The conversion price of the Series C Preferred Stock is subject to proportional adjustment for stock dividends, stock splits and similar events, and to full-ratchet adjustment in connection with certain dilutive issuances, in each case subject to a floor price of $1.50 per share (with a cash true-up payable if a holder converts following a dilutive issuance that would otherwise have reduced the conversion price below such floor price). If the Series C Preferred Stock were converted in full at the floor price, we would issue up to 4,779,333 shares of Common Stock, not taking into account any dividends that may be paid in additional shares of Series C Preferred Stock. Dividends accrue on the Series C Preferred Stock at a rate of 8% per annum, compounding quarterly (increasing to 9% per annum if not paid in cash), and may be paid in cash, in additional shares of Series C Preferred Stock or by an increase in the stated value of the Series C Preferred Stock. Holders of the Series C Preferred Stock may not convert shares of Series C Preferred Stock to the extent that, after giving effect to such conversion, the holder, together with its affiliates, would beneficially own in excess of 4.99% (or, upon at least 61 days’ prior notice to us, up to 19.99%) of our outstanding Common Stock. See Part I, Item 1. Financial Statements Note 10 – Stockholder’s Equity included elsewhere in this Quarterly Report on Form 10-Q for additional information regarding the terms of the Series C Preferred Stock.
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Results of Operations for the Three Months Ended June 30, 2026 and Three Months Ended June 30, 2025
The following table sets forth, for the periods indicated, the dollar value represented by certain items in our Statements of Operations:
| For the Three Months Ended June 30, 2026 | For the Three Months Ended June 30, 2025 | |||||||
| Revenues | $ | 4,255,906 | $ | 1,402,511 | ||||
| Cost of revenue | 2,898,411 | 857,556 | ||||||
| Total payroll and related expenses | 1,011,733 | 685,974 | ||||||
| Total general and administrative expenses | 1,916,390 | 1,429,935 | ||||||
| Total professional and consulting fees | 667,206 | 181,614 | ||||||
| Total marketing and business development expenses | 758,143 | 156,778 | ||||||
| Total bad debt expense | - | 3,025,000 | ||||||
| Operating loss | (2,995,977 | ) | (4,934,346 | ) | ||||
| Interest expense | (2,809,439 | ) | (830,196 | ) | ||||
| Interest income | - | 23,984 | ||||||
| Loss on exchange transaction | (2,215,127 | ) | - | |||||
| Other income | 1,327 | 16,603 | ||||||
| Net loss | $ | (8,019,216 | ) | $ | (5,723,955 | ) | ||
Revenues
During the three months ended June 30, 2026 and 2025, we generated revenues of $4,255,906 and $1,402,511, respectively, primarily from logistics, collection, processing and disposal services provided by our subsidiary ZEI ($3,207,133 for the 2026 period), and from the sale of materials, including compost, engineered soils, and mulch, by Resource Group ($1,048,773 for the 2026 period). Revenues also included proceeds from converting a portion of collected waste into saleable materials. This increase of $2,853,395 resulted from a full three months of revenue from Resource Group, which we acquired on June 2, 2025, in the 2026 period versus approximately one month in the 2025 period, and the resulting change of focus in our core business.
Cost of Revenues
Cost of revenue for the three months ended June 30, 2026, were $2,898,411 compared to $857,556 for the three months ended June 30, 2025. This increase of $2,040,855 in costs resulted primarily from additional revenues generated as a result from the acquisition of Resource Group and the resulting change of focus in our core business. Gross profit for the three months ended June 30, 2026 was $1,357,495, representing a gross margin of approximately 31.9%.
Payroll and Related Expenses
Payroll and related expenses for the three months ended June 30, 2026 were $1,011,733 compared to $685,974 for the three months ended June 30, 2025. This increase of $325,759 in expenses resulted primarily from additional employees hired to support the growth of our logistics and compost sales operations following the acquisition of Resource Group.
Marketing and Business Development Expenses
Marketing and business development expenses for three months ended June 30, 2026 were $758,143 compared to $156,778 for the three months ended June 30, 2025. This increase resulted from additional spending on marketing related activities during the three months ended June 30, 2026.
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General And Administrative Expenses
General and administrative expenses for three months ended June 30, 2026 were $1,916,390 compared to $1,429,935 for the three months ended June 30, 2025. This increase of $486,455 resulted primarily from a full quarter of Resource Group and ZEI operating overhead, including insurance, facility and vehicle-related costs, and from the increased costs of operating as a public company.
Professional and Consulting Fees
Professional and consulting fees for three months ended June 30, 2026 were $667,206 compared to $181,614 for the three months ended June 30, 2025. This increase of $485,592 resulted primarily from the increased cost of professional fees in relation of being a public company, including increased audit and accounting fees, legal fees associated with our financing transactions and registration statements, and consulting fees supporting the integration of Resource Group.
Interest Expense
During the three months ended June 30, 2026 and 2025, we incurred $2,809,439 and $830,196 of interest expense. This increase of $1,979,243 resulted from an increase in the balance of our notes payable.
Interest Income
During the three months ended June 30, 2026 and 2025, we earned $0 and $23,984 of interest income. This decrease of $23,984 resulted from a decrease in notes receivable balance during the three months ended June 30, 2026.
Loss on Exchange Transaction
During the three months ended June 30, 2026 and 2025, we recognized a loss on exchange transactions of $2,215,127 and $0, respectively.
Results of Operations for the Six Months Ended June 30, 2026 and Six Months Ended June 30, 2025
The following table sets forth, for the periods indicated, the dollar value represented by certain items in our Statements of Operations:
| For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 | |||||||
| Revenues | $ | 8,214,030 | $ | 1,420,681 | ||||
| Cost of revenue | 5,524,079 | 869,356 | ||||||
| Total payroll and related expenses | 2,065,693 | 1,137,426 | ||||||
| Total general and administrative expenses | 3,337,811 | 1,879,489 | ||||||
| Total professional and consulting fees | 1,753,481 | 467,180 | ||||||
| Total marketing and business development expenses | 1,297,870 | 240,439 | ||||||
| Total bad debt expense | - | 3,025,000 | ||||||
| Operating loss | (5,764,904 | ) | (6,198,209 | ) | ||||
| Interest expense | (4,141,183 | ) | (1,784,845 | ) | ||||
| Change in fair value of derivative liability | (1,268,162 | ) | - | |||||
| Loss on settlement of derivative liability | (3,881,922 | ) | - | |||||
| Interest income | - | 47,672 | ||||||
| Loss on sale of equipment | (80,289 | ) | - | |||||
| Loss on exchange transaction | (2,215,127 | ) | - | |||||
| Other income | 3,370 | 31,432 | ||||||
| Net loss | $ | (17,348,217 | ) | $ | (7,903,950 | ) | ||
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Revenues
During the six months ended June 30, 2026 and 2025, we generated revenues of $8,214,030 and $1,420,681, respectively, primarily from logistics, collection, processing and disposal services provided by our subsidiary ZEI ($6,217,295 for the 2026 period), and from the sale of materials, including compost, engineered soils, and mulch, by Resource Group ($1,996,735 for the 2026 period). Revenues also included proceeds from the conversion of a portion of collected waste into saleable materials. For the six months ended June 30, 2025, we generated revenues from commissions on residential real estate purchases and sale transactions amounting to $18,170. This increase of $6,793,349 resulted from the acquisition of Resource Group during 2025 and the resulting change of focus in our core business.
Cost of Revenues
Cost of revenue for the six months ended June 30, 2026, were $5,524,079 compared to $869,356 for the six months ended June 30, 2025. This increase of $4,654,723 in costs resulted primarily from additional revenues generated as a result from the acquisition of Resource Group and the resulting change of focus in our core business. Gross profit for the six months ended June 30, 2026 was $2,689,951, representing a gross margin of approximately 32.7%.
Payroll and Related Expenses
Payroll and related expenses for the six months ended June 30, 2026 were $2,065,693 compared to $1,137,426 for the six months ended June 30, 2025. This increase of $928,267 in expenses resulted primarily from additional employees hired to support the growth of our logistics and compost sales operations following the acquisition of Resource Group.
Marketing and Business Development Expenses
Marketing and business development expenses for six months ended June 30, 2026 were $1,297,870 compared to $240,439 for the six months ended June 30, 2025. This increase resulted from additional spending on marketing related activities during the six months ended June 30, 2026.
General And Administrative Expenses
General and administrative expenses for six months ended June 30, 2026 were $3,337,811 compared to $1,879,489 for the six months ended June 30, 2025. This increase of $1,458,322 resulted primarily from a full six months of Resource Group and ZEI operating overhead, including insurance, facility and vehicle-related costs, and from the increased costs of operating as a public company.
Professional and Consulting Fees
Professional and consulting fees for six months ended June 30, 2026 were $1,753,481 compared to $467,180 for the six months ended June 30, 2025. This increase of $1,286,301 resulted primarily from the increased cost of professional fees in relation of being a public company, including increased audit and accounting fees, legal fees associated with our financing transactions and registration statements, and consulting fees supporting the integration of Resource Group.
Interest Expense
During the six months ended June 30, 2026 and 2025, we incurred interest expense of $4,141,183 and $1,784,845, respectively. This increase of $2,356,338 resulted from an increase in the balance of our notes payable.
Change in fair value of derivative liability
During the six months ended June 30, 2026 and 2025, we incurred $1,268,162 and $0 of change in fair value. This increase of $1,268,162 resulted from a derivative liability balance during the six months ended June 30, 2026.
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Loss on settlement of derivative liability
During the six months ended June 30, 2026 and 2025, we incurred $3,881,922 and $0 of loss on settlement. This increase of $3,881,922 resulted from the settlement of derivative liability balance during the six months ended June 30, 2026.
Interest Income
During the six months ended June 30, 2026 and 2025, we earned $0 and $47,672 of interest income. This decrease of $47,672 resulted from a decrease in notes receivable balance during the six months ended June 30, 2026.
Loss on Exchange Transaction
During the six months ended June 30, 2026 and 2025, we recognized a loss on exchange transactions of $2,215,127 and $0, respectively.
Income Tax Provision
A 100% valuation allowance was provided against the deferred tax asset consisting of available net operating loss carry forwards and, accordingly, no income tax benefit was provided.
Liquidity and Capital Resources
We have generated limited revenue and have incurred significant net losses in each year since inception. For the six months ended June 30, 2026, we incurred a net loss of $17,348,217 as compared to a net loss of $7,903,950 for the six months ended June 30, 2025. We expect to incur increasing losses in the future. As of June 30, 2026 and December 31, 2025, we had cash of $2,160,288 and $54,066, respectively. Since becoming a public company, we have funded our operations through note financings, project level financings, and the issuance of our equity and debt securities. See Part I, Item 1. Financial Statements; Note 7– Notes Payable and Notes Payable– Related Party, Note 10 – Stockholder’s Equity and Note 16-Subsequent Events. We intend to continue to finance our operations and finance Resource Group’s expansion if needed from the proceeds of future financings, proceeds from the sale of properties, and future revenues from operations. As of the date of the filing of this Quarterly Report on Form 10-Q, we do not have any committed sources of financing other than the use of the funding of the Second April 2026 Notes to repay the balance of the February 2026 Notes if the conditions to funding are met and the Second Closing is completed. As of the date of this Quarterly Report on Form 10-Q, the Second Closing has not been completed, and no assurances can be provided that the Second Closing will be completed. In addition, although the April 2026 Purchase Agreement provides for the funding of an additional $87,000,000, such funding is subject to the Purchasers’ discretion and our ability to meet certain conditions and there can be no assurance that we will be able to access such funding. Additional financing will be required to continue operations, which may not be available at acceptable terms, if at all. There is no guarantee we will be successful in raising capital outside of our current sources. In addition, under the purchase agreements from our recent private placement offerings, we are subject to certain restrictive covenants that may make it difficult for us to procure additional financing. Our current cash is anticipated to be sufficient to fund operations through December 2026. We expect that we will need additional future financing which may not be available on acceptable terms, if at all. These and other factors raise substantial doubt about our ability to continue as a going concern. The report of our independent registered public accounting firm includes an explanatory paragraph that our auditors have expressed substantial doubt that we will be able to continue as a going concern.
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Financing Activities
The following table represents our financing activities during the six months ending June 30, 2026. See Part I, Item 1. Financial Statements Note 7– Notes Payable and Notes Payable– Related Party, Note 10 -Stockholder’s Equity to the financial statements included elsewhere in this Quarterly Report for additional information regarding our financing activities.
| Balance as of December 31, 2025 | Additions | Payments or Conversions | Balance as of June 30, 2026 | |||||||||||||
| LV Note | $ | 1,000,000 | $ | - | $ | - | $ | 1,000,000 | ||||||||
| 2nd Lien Note | 1,000,000 | - | - | 1,000,000 | ||||||||||||
| New BCV Loan Agreement | 2,000,000 | 1,583,400 | - | 3,583,400 | ||||||||||||
| 1800 Diagonal Notes | 478,610 | 332,910 | (443,427 | ) | 368,093 | |||||||||||
| Cedar Cash Advances | 427,000 | 85,000 | (132,633 | ) | 379,367 | |||||||||||
| Boot Capital | 87,750 | - | (67,755 | ) | 19,995 | |||||||||||
| Sixth Borough | 250,000 | - | (250,000 | ) | - | |||||||||||
| Member Note | 480,000 | - | - | 480,000 | ||||||||||||
| Peak One | - | 310,000 | (310,000 | ) | - | |||||||||||
| Anson East Master Fund LP | - | 2,574,375 | - | 2,574,375 | ||||||||||||
| Anson Investment Master Fund LP | - | 7,723,125 | - | 7,723,125 | ||||||||||||
| Alto Opportunity Master Fund, SPC | - | 2,675,485 | - | 2,675,485 | ||||||||||||
| Acquisition Related Notes and Additional Equipment Loan and Cash Advances * | 15,788,293 | 1,758,697 | (7,138,635 | ) | 10,408,355 | |||||||||||
| $ | 21,511,653 | $ | 17,042,992 | $ | (8,342,450 | ) | $ | 30,212,195 | ||||||||
| * | Includes notes payable amounts acquired in connection with the Resource Group acquisition, as well as additional financing needs of our Resource and ZEI activities. |
Cash Flow Summary
| For the Six Months Ended June 30, 2026 | For the Six Months Ended June 30, 2025 | |||||||
| Net cash provided by (used in): | ||||||||
| Operating activities | $ | (5,103,907 | ) | $ | 313,418 | |||
| Investing activities | (1,743,096 | ) | 358,795 | |||||
| Financing activities | 8,953,225 | (496,893 | ) | |||||
| Net change in cash and cash equivalents | $ | 2,106,222 | $ | 175,320 | ||||
Operating activities used net cash of $5,103,907 during the six months ended June 30, 2026, and provided net cash of $313,418 during the six months ended June 30, 2025. Cash used in operating activities increased by $5,417,325 due to an increase of net loss of $9,444,267, partially offset by a $5,150,084 increase in the change in fair value of and loss on settlement derivative liabilities as well as $2,215,127 in loss on exchange transaction. Additional factors impacting operating cash flows included an increase in depreciation expense of $964,528, an increase in amortization of debt issuance costs of $1,122,734, and a decrease in stock-based compensation of $177,011, as well as common stock issued for services of $178,558 in 2026 compared to no such issuance in 2025. Changes in operating assets and liabilities also contributed to the increase in cash used, which amounted to $1,024,710 during 2026 compared to $2,762,313 during 2025.
Investing activities used net cash of $1,743,096 during the six months ended June 30, 2026, and provided net cash of $358,795 during the six months ended June 30, 2025, which is an increase in cash used of $2,101,891. This change results from an increase in proceeds from sale of property and equipment of $25,000, decrease in intangible assets of $7,778, increase in the purchase of property and equipment of $1,746,796, an increase in additions to equity based investments $21,300.
Cash provided from financing activities was $8,953,225 during the six months ended June 30, 2026, which resulted from $2,068,717 in debt issuance costs paid, $90,640 in finance lease payments, increased by $16,323,308 proceeds from short-term note payable, $2,441,537 in repayments of short-term notes payable and $2,769,189 of cash payments on derivative liabilities. Cash used in financing activities was $496,893 during the six months ended June 30, 2025, which resulted from $361,477 debt issuance costs paid, increased by $1,041,800 proceeds from short-term note payable, $1,139,993 in repayments of short-term notes payable, $13,620 payments on finance lease and $58 from payment related to stock splits.
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Off-Balance Sheet Arrangements
As of June 30, 2026 and December 31, 2025, we had no material off-balance sheet arrangements to which we are a party.
Critical Accounting Estimates
Our financial statements have been prepared using generally accepted accounting principles in the United States of America (“GAAP”). In connection with the preparation of the financial statements, we are required to make assumptions and estimates and apply judgments that affect the reported amounts of assets, liabilities, revenue, and expenses, and the related disclosures. We base our assumptions, estimates, and judgments on historical experience, current trends, and other factors that we believe to be relevant at the time the financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates, and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.
Our significant accounting policies are discussed in “Note 2— Summary of Significant Accounting Policies” of the notes to our financial statements for the six months ended June 30, 2026 and the year ended December 31, 2025 included elsewhere in this Form 10-Q. We believe that the following accounting policies are the most critical in fully understanding and evaluating our reported financial results.
Investment Entities — The Company obtained a 50% membership interest in Norman Berry. The purpose of the investment in Norman Berry is to develop and provide affordable housing in the Atlanta, Georgia metropolitan area. The Company has determined it is not the primary beneficiary of Norman Berry and thus does not consolidate the activities in its financial statements. The Company uses the equity method to report the activities as an investment in its condensed consolidated financial statements. As of June 30, 2026 the Company continued to hold a 50% interest in Norman Berry. The Norman Berry partnership recently obtained final city council and entitlement approval for the project. The next step involves completing the consolidation of the various lots into a single parcel, and the Company’s development team and surveyors are preparing the required documentation and submittals for city review and approval. Survey documents reflecting the approved M-I zoning designation are expected to be submitted to the city’s Planning Department for administrative review to obtain final parcel-map approval.
During the six months ended June 30, 2026 and 2025, Norman Berry did not have any material earnings or losses as the investments are in development. In addition, management believes there was no impairment as of June 30, 2026 and December 31, 2025.
Property, plant and equipment — Property, plant and equipment is stated at cost. Depreciation is computed using the straight-line method over the estimated lives of each asset. Repairs and maintenance are charged to expense when incurred. Included in property, plant and equipment, are recoverable reserves acquired in connection with the Resource acquisition described below. Such reserves represent the approximately 9 million tons of entitled sand reserves on the land obtained in connection with the Resource acquisition as well. The estimated amount was based on third-party engineering and appraisal reports. Cost depletion on these depletable reserves is based upon units-of-production.
Intangible assets — Intangible assets consist of $22,210 of website costs that will be amortized over 5 years, $5,458,400 of trade name that will be amortized over 15 years, and $6,368,100 of a license agreement that will be amortized over 10 years which is the life of the license.
Project Development Costs — Project development costs are stated at cost. At June 30, 2026 and December 31, 2025, the Company’s project development costs are expenses incurred related to development costs on various projects that are capitalized during the period the project is under development.
JOBS Act
The JOBS Act permits an emerging growth company such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected to avail ourselves of the extended transition period for complying with new or revised financial accounting standards.
We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year (a) following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, (b) in which we have total annual revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which generally means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter; and (2) the date on which we have issued more than $1 billion in non-convertible debt securities during the prior three-year period.
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ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.
ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures.
Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, conducted an evaluation, as of the end of the period covered by this report, of the effectiveness of our disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e). Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that as of the end of the period covered by this report, our disclosure controls and procedures, as defined in Rule 13a-15(e), were effective at the reasonable assurance level.
Changes in Internal Control over Financial Reporting
During the fiscal quarter ended June 30, 2026 there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, 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. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.
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PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
The information included in “Note 14 - Commitments and Contingencies” of our condensed consolidated financial statements included elsewhere in this Quarterly Report Form 10-Q is incorporated by reference into this Item.
ITEM 1A. Risk Factors
Except as set forth below, there have been no material changes in our risk factors from the risks previously reported in Part 1, Item 1A, “Risk Factors” of our 2025 10-K. You should carefully consider the factors discussed here and in our 2025 Form 10-K, which could materially affect our business, financial condition or future results. The risks described here and in our 2025 Form 10-K are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.
Our auditors have expressed substantial doubt about our ability to continue as a going concern.
We have generated limited revenue and have incurred significant net losses in each year since inception. For the six months ended June 30, 2026, we incurred a net loss of $17,348,217 as compared to a net loss of $7,903,950 for the six months ended June 30, 2025. We expect to incur increasing losses in the future. We cannot offer any assurance as to our future financial results. Our inability to achieve profitability from our current operating plans or to raise capital to cover any potential shortfall would have a material adverse effect on our ability to meet our obligations as they become due. If we are not able to secure additional funding, if, and when needed, we would be forced to curtail our operations or take other action in order to continue to operate. These and other factors raise substantial doubt about our ability to continue as a going concern. If we are unable to meet our obligations and are forced to curtail or cease our business operations, our stockholders could suffer a complete loss of any investment made in our securities.
We will need to raise additional capital to support our long-term business plans and our failure to obtain funding when needed may force us to delay, reduce or eliminate our development plans.
During the six months ended June 30, 2026, our operating activities used net cash of $5,103,907 and as of June 30, 2026, our cash was $2,160,288. We have experienced significant losses since inception and have a significant accumulated deficit as of June 30, 2026 totaling $49,760,186. We expect to incur additional operating losses in the future and therefore expect our cumulative losses to increase. To date, we have not derived substantial revenue from the properties we own or have an interest in. We expect to potentially generate revenue through our growth of our compost and logistics businesses and sales of property, if any. There is uncertainty as to our ability to monetize our real estate properties or to generate sales proceeds. We expect our expenses to increase as operations increase from our compost and logistics businesses.
Although we have raised approximately $21.3 million from the sale of securities in the past twelve months, unless we generate significant revenue from our compost and logistics businesses, we believe we will need to raise additional capital to fund our business expansion plans and we cannot be certain that funding will be available to us on acceptable terms on a timely basis, or at all. To meet our financing needs, we are considering multiple alternatives, including, but not limited to, additional equity and debt financings. As of the date of the filing of this Quarterly Report on Form 10-Q, we do not have any committed sources of financing other than the funding of the Second April 2026 Notes if the conditions to funding are met. As of the date of this Quarterly Report on Form 10-Q, the Second Closing has not been completed, and no assurances can be provided that the Second Closing will be completed. Additionally, although the April 2026 Purchase Agreement provides for the funding of an additional $87,000,000, such funding is subject to the Purchasers’ discretion and our ability to meet certain conditions and there can be no assurance that we will be able to access such funding. Our ability to raise capital through the sale of securities may be limited by various rules of the SEC and Nasdaq that place limits on the number and dollar amount of securities that we may sell. Any additional sources of financing will likely involve the issuance of our equity or debt securities, which will have a dilutive effect on our stockholders. To the extent that we raise additional funds by issuing equity securities, our stockholders may experience significant dilution. Any debt financing, if available, may involve restrictive covenants that may impact our ability to conduct our business. Our current outstanding debentures prohibit us from engaging in certain types of financing while the debentures are outstanding. If we fail to raise additional funds on acceptable terms, we may be unable to complete planned development work.
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Under the February 2026 Purchase Agreement and April 2026 Purchase Agreement, we are subject to certain restrictive covenants that may make it difficult to procure additional financing.
The February 2026 Purchase Agreement and April 2026 Purchase Agreement contain restrictive covenants which restrict our ability to issue securities or file additional registration statements. If we require additional funding while these restrictive covenants remain in effect, we may be unable to effect a financing transaction on terms acceptable to us, or at all, while also remaining in compliance with the terms of the respective purchase agreements, or we may be forced to seek a waiver from the purchasers party to the February 2026 and April 2026 Purchase Agreements, which such purchasers are not obligated to grant to us.
On April 8 and April 9, 2026, we entered into a consent and waiver agreement extending certain deadlines under the February 2026 Purchase Agreement; our failure to satisfy our remaining obligations thereunder could result in additional covenant remedies or require further negotiation with the investors.
Pursuant to the consent and waiver agreement entered into with the investors in the February 2026 Private Placement on April 8 and April 9, 2026, we obtained extensions of the deadlines by which we must (i) file a proxy statement and hold a stockholder meeting to obtain stockholder approval of the exercise of the Second February Warrants; and (ii) cause an initial registration statement registering the resale of the shares of Common Stock issuable upon conversion and exercise of the February 2026 Notes and certain of the February 2026 Warrants to be declared effective by the SEC. Stockholder approval was obtained at our 2026 Annual Meeting held on June 12, 2026, satisfying the extended proxy and stockholder meeting deadlines and the initial resale registration statement related to the February 2026 Private Placement was declared effective on April 15, 2026. However, as of the date of this Quarterly Report on Form 10-Q, we have not filed an additional registration statement to register the shares of Common Stock issuable upon exercise of the Second February Warrants and certain shares of Common Stock issuable pursuant to the conversion of the February 2026 Notes, and are therefore not in compliance with all of our remaining obligations.
A registration default under the Registration Rights Agreement we entered into in connection with the April 2026 Private Placement could result in liquidated damages obligations that would adversely affect our cash position.
Pursuant to the Registration Rights Agreement (the “April 2026 RRA”) that we entered into with the investors in connection with the April 2026 Private Placement, we are obligated to file and maintain the effectiveness of one or more registration statements covering the resale of the shares of Common Stock issuable upon conversion of the Initial April 2026 Notes and Second April 2026 Notes, additional shares of our Common Stock that may become issuable under the Initial April 2026 Notes and Second April 2026 Notes as a result of an Alternate Conversion, as well certain additional shares of our Common Stock that may be issuable upon conversion or exercise of convertible promissory notes and warrants that we may sell and issue to the purchasers pursuant to the April 2026 Purchase Agreement. Pursuant to the April 2026 RRA, if we fail to satisfy our registration obligations under the April 2026 RRA, including by failing to file or obtain or maintain the effectiveness of the required registration statements within specified time frames, we may be required to pay liquidated damages to the investors. Unless waived by the investors, we will be required to pay liquidated damages due to our failure to fulfill all of our obligations under the April 2026 RRA.
Our processing and transportation operations depend on a fleet of specialized equipment financed through multiple lenders, and the unavailability of equipment or equipment financing could impair our operational capacity.
Our biomass recycling and logistics operations rely on a fleet of specialized processing equipment and transportation vehicles, including trommel screeners, grinders, shredders, and grapple trucks, a significant portion of which is financed through secured lending arrangements with third-party lenders. Effective December 30, 2025, our wholly owned subsidiary Resource Group LLC entered into two Negotiable Promissory Notes and Security Agreements with Commercial Credit Group in the aggregate original principal amount of approximately $2.55 million to finance the acquisition of a Komptech Crambo shredder and a Diamond Z horizontal grinder. These notes are secured by substantially all of the assets of Resource Group LLC. A default under any of our equipment financing arrangements, or our inability to obtain financing for additional equipment on commercially reasonable terms, could impair our operational capacity and adversely affect our business, financial condition, and results of operations.
Our legacy real estate monetization efforts are subject to significant execution risk, and we may not realize the anticipated proceeds from our legacy real estate portfolio.
We continue to pursue the monetization of our legacy real estate holdings, including through sales, joint ventures, and conveyances to secured creditors. On January 6, 2026, our wholly owned subsidiary LV Peninsula Holding, LLC delivered a Deed in Lieu of Foreclosure conveying title to our Lake Travis project site in Lago Vista, Texas, to an institutional lender in exchange for the conditional extinguishment of $5.0 million of outstanding secured debt. Although we retain the right to receive 70% of any net sale proceeds above $5.0 million upon the lender’s disposition of the Lago Vista property, and we may receive payment on a conditional $5.0 million promissory note issued by LV Peninsula in certain circumstances, there can be no assurance that any such proceeds or payments will be realized or that the amounts realized will be material. Additional risks affect our remaining legacy real estate holdings, including the Norman Berry Village joint venture in East Point, Georgia (as to which the first lien note held by us matured on March 11, 2025 and remains in default), our interest in JDI-Cumberland Inlet, LLC (which filed for bankruptcy protection in May 2025, and from which we have not received any proceeds as of the date of this Quarterly Report), and the McLean Mixed Use Site in Durant, Oklahoma (subject to a Lis Pendens filed by the Durant Industrial Authority). Any failure to monetize our legacy real estate holdings on commercially reasonable terms, or at all, could adversely affect our liquidity and financial position.
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We are dependent on a limited number of customers and a limited number of commercial drivers, and the loss of key customers or drivers could adversely affect our business.
Our biomass recycling and logistics businesses currently serve a limited set of customers, including municipal entities, construction contractors, landscaping companies, and a multi-billion-dollar national waste management company. In addition, our logistics operations depend on a small number of licensed commercial drivers. The loss of any significant customer, or an inability to recruit, train, and retain qualified drivers, could materially impair our transportation capacity and revenues, adversely affect our margins, and require us to incur incremental costs to replace lost business or personnel.
We are subject to extensive federal, state, and local environmental laws and regulations, and changes in those laws and regulations may increase our operating costs or expose us to liability.
Our engineered soils, remediation, organics processing, and logistics operations involve the handling, transport, and processing of materials that are subject to federal, state, and local environmental laws and regulations, including without limitation the Comprehensive Environmental Response, Compensation, and Liability Act. Liability under such laws may be imposed on a strict, joint and several basis, and may be imposed even for contamination not caused by our own operations. Changes in environmental laws, regulations, or enforcement priorities including policies relating to landfill bans, organics diversion mandates, air quality, and water quality could impose additional costs and limitations on our operations and adversely affect our competitive position.
We face risks related to supply of organic feedstocks, vehicle and equipment supply chains, fuel costs, and material price volatility, any of which could adversely affect our margins.
Our operations rely on a consistent and cost-effective supply of organic feedstocks, amendments, vehicle fuel, and specialized equipment. Disruptions in the supply chain for any of these inputs, or sustained increases in fuel or input costs, could reduce our operating margins, impair our ability to fulfill customer orders, and adversely affect our business, financial condition, and results of operations.
A substantial portion of our outstanding indebtedness has matured or requires significant payments in the near term, and our failure to repay, refinance or restructure such indebtedness could materially and adversely affect our business, financial condition and results of operations.
A significant portion of our outstanding indebtedness has matured or requires substantial debt service payments in the near term. Beginning on or about July 14, 2026, we are required to make monthly installment payments on the February 2026 Notes in an amount equal to 110% of one-tenth of the outstanding principal amount thereof plus accrued and unpaid interest. Our note payable to Loeb requires a payment of approximately $1.8 million at its September 7, 2027 maturity. In addition, certain of our notes payable, including a $2.5 million mortgage note payable to the Gail Baird Foundation that matured on April 21, 2025 and a $50,000 note that matured on April 30, 2025, were not repaid at maturity; although the applicable lenders have not declared these notes in default and we have continued to pay interest thereon, the lenders could elect to exercise remedies, and unpaid matured indebtedness could trigger cross-default provisions in our other debt instruments. If we are unable to pay, refinance, restructure or otherwise satisfy our indebtedness as it becomes due, whether with the proceeds of the Second Closing of the April 2026 Private Placement (which is conditioned on the satisfaction of certain conditions that have not been met), other financings or cash from operations, our lenders could exercise remedies against us and our assets, including collateral securing certain of these obligations, and we could be forced to curtail our operations, which would materially and adversely affect our business, financial condition and results of operations.
Risks Related to Our Common Stock
The 1-for-20 Reverse Stock Split may not achieve its intended effect and may adversely affect the liquidity of our common stock.
On March 26, 2026, we effected the 1-for-20 Reverse Stock Split. The Reverse Stock Split reduced the number of our outstanding shares of common stock from approximately 50,000,000 to approximately 2,507,537. Although the Reverse Stock Split was effected to, among other things, raise the per-share trading price of our common stock to allow for continued listing on The Nasdaq Capital Market, there can be no assurance that the Reverse Stock Split will have the desired effect of sufficiently raising the per-share trading price of our common stock over the long term, that any resulting price level will be maintained, or that the Reverse Stock Split will not adversely affect the liquidity of our common stock. In addition, the reduction in the number of outstanding shares may decrease trading volume, increase price volatility, and adversely affect the market price of our common stock. In addition, on June 12, 2026, our stockholders approved an amendment to our Amended and Restated Certificate of Incorporation, as amended, to effect, at the discretion of our Board of Directors, an additional reverse stock split of our issued and outstanding common stock at a ratio of between 1-for-5 and 1-for-10. If our Board of Directors effects such a reverse stock split, it would further reduce the number of our outstanding shares of common stock and would be subject to the same risks described above, and there can be no assurance that it would achieve its intended effects.
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If we fail to comply with the continued listing requirements of Nasdaq, our Common Stock may be delisted and the price of our Common Stock and our ability to access the capital markets could be negatively impacted.
Our Common Stock is currently listed for trading on Nasdaq. We must satisfy Nasdaq’s continued listing requirements, including, among other things, a minimum stockholders’ equity of $2.5 million and a minimum closing bid price of $1.00 per share or risk delisting, which would have a material adverse effect on our business. A delisting of our Common Stock from Nasdaq could materially reduce the liquidity of our Common Stock and result in a corresponding material reduction in the price of our Common Stock. In addition, delisting could harm our ability to raise capital through alternative financing sources on terms acceptable to us, or at all, and may result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities.
On January 26, 2026, we received a letter from Nasdaq notifying us that for the preceding 30 consecutive business days (December 5, 2025 through January 20, 2026), our Common Stock did not maintain a minimum closing bid price of $1.00 per share as required by Nasdaq Listing Rule 5550(a)(2) (“Minimum Bid Price Requirement”). The notice had no immediate effect on the listing or trading of our Common Stock, which continues to trade on the Nasdaq Capital Market under the symbol “RENX.” In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we had a compliance period of 180 calendar days, or until July 27, 2026, to regain compliance with Nasdaq Listing Rule 5550(a)(2). On December 8, 2025, our stockholders approved and authorized us to amend our Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split at a ratio of 1-for-5 to 1-for-20, and on March 26, 2026, we effected the 1-for-20 reverse stock split of our then-outstanding Common Stock. Nasdaq Listing Rule 5810(c)(3)(A)(iv) states that any listed company that fails to meet the Minimum Bid Price Requirement and has effected a reverse stock split over the prior one-year period, or has effected one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one, will not be eligible for an automatic 180-day grace compliance period and the Nasdaq Listing Qualifications Department is obligated to immediately issue a delisting determination if it should fail to meet any continued listing requirements. Therefore, if we were to fail to meet any continued listing requirements within the applicable time periods we would immediately be issued a delisting determination. Further, the Nasdaq rule provides that a company will not be considered to have regained compliance with the minimum bid price requirement if the company takes an action to achieve compliance (such as a reverse split) and that action results in its security falling below the numeric threshold for another listing requirement.
On April 10, 2026, we received written notice (“Listing Notification”) from the Listing Qualifications staff of Nasdaq notifying us that we had regained compliance with Nasdaq Listing Rule 5550(a)(2), which requires that companies listed on the Nasdaq Capital Market maintain a minimum bid price of $1.00 per share. Nasdaq notified the Company in the Listing Notification that for the last 10 consecutive business days, from March 26, 2026 through April 9, 2026, the closing bid price of our Common Stock had been at $1.00 per share or greater and, accordingly, we had regained compliance with Nasdaq Listing Rule 5550(a)(2) and that the matter was now closed.
Additionally, Nasdaq recently proposed a new rule change (as amended on June 18, 2026) to (i) adopt Listing Rules 5450(a)(3) and 5550(a)(6) to require issuers listed on the Nasdaq Global and Capital Markets, respectively, to maintain a minimum Market Value of Listed Securities (as defined in Nasdaq Listing Rule 5005(a)(23)) of at least $5.0 million for a period of 30 consecutive business days, and (ii) amend Rule 5810 to suspend trading and immediately delist from Nasdaq securities of issuers that do not satisfy the proposed new requirements, and Rule 5815 to set forth the procedures for requesting a hearing before a Hearings Panel and the scope of the Panel’s discretion (collectively, the “Proposed $5 Million MVLS Rule”). On April 28, 2026, the SEC notified Nasdaq that it had determined to delay the implementation of the new standards to seek additional public feedback on the Proposed $5 Million MVLS Rule, providing the public at least 21 days to comment on the proposed rule. On July 22, 2026, the SEC approved the Proposed $5M MVLS Rule, permitting Nasdaq to implement the rule. However, subsequently on July 29, 2026, the implementation of the Proposed $5 Million MVLS Rule was automatically stayed after notices of petition were filed. As of August 11, 2026, the market value of our listed securities was approximately $5.2 million. If the stay on the implementation of the Proposed $5 Million MVLS Rule is lifted and the market value of our listed securities does not meet the $5.0 million requirement as of the date it goes into effect, our securities will be subject to delisting.
There is no assurance that we will maintain compliance with all applicable requirements for continued listing on Nasdaq. If our Common Stock were delisted from Nasdaq, trading of our Common Stock would most likely take place on an over-the-counter market established for unlisted securities, such as the OTCQB or the Pink Market maintained by OTC Markets Group Inc. An investor would likely find it less convenient to sell, or to obtain accurate quotations in seeking to buy, our Common Stock on an over-the-counter market, and many investors would likely not buy or sell our Common Stock due to difficulty in accessing over-the-counter markets, policies preventing them from trading in securities not listed on a national exchange or other reasons. In addition, as a delisted security, our Common Stock would be subject to SEC rules as a “penny stock,” which impose additional disclosure requirements on broker-dealers. The regulations relating to penny stocks, coupled with the typically higher cost per trade to the investor of penny stocks due to factors such as broker commissions generally representing a higher percentage of the price of a penny stock than of a higher-priced stock, would further limit the ability of investors to trade in our Common Stock. In addition, delisting could harm our ability to raise capital through alternative financing sources on terms acceptable to us, or at all, and may result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities. For these reasons and others, delisting would adversely affect the liquidity, trading volume and price of our Common Stock, causing the value of an investment in us to decrease and having an adverse effect on our business, financial condition and results of operations, including our ability to attract and retain qualified employees and to raise capital.
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The conversion of our Senior Convertible Notes and the exercise of our outstanding warrants, preferred stock, and other convertible securities could result in substantial dilution to our stockholders.
As of June 30, 2026, we had outstanding February 2026 Notes (convertible into shares of our Common Stock at an initial conversion price of $5.62 per share), First February Warrants (exercisable for shares of our Common Stock at an initial exercise price of $3.1188 per share), Second February Warrants (which became exercisable upon receipt of stockholder approval on June 12, 2026, at an initial exercise price of $3.1188 per share), Initial April 2026 Notes (convertible into shares of Common Stock at an initial conversion price of $2.895, which is subject to adjustment down to the April 2026 Note Floor Price), Initial April 2026 Warrants, shares of Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock (convertible into shares of our Common Stock at an initial conversion price of $2.895 per share, subject to full-ratchet adjustment for certain dilutive issuances with a floor price of $1.50 per share and a cash true-up in certain circumstances), a warrant to purchase up to 619,084 shares of our Common Stock issued to Index Equity US, LLC in June 2026, which is exercisable at an initial exercise price of $2.895 per share, and various other warrants and rights to acquire shares of our Common Stock. In addition, we have agreed to issue the April 2026 Second Notes and the April 2026 Second Warrants upon or promptly after the effective date of the registration statement that we are required to file in order to register the offer and resale of the shares of Common Stock issuable upon conversion of the Initial April 2026 Notes and the April 2026 Second Notes and exercise of the April 2026 First Warrants and April 2026 Second Warrants. The conversion of the foregoing convertible notes, the exercise of the foregoing outstanding warrants, the conversion of outstanding shares of our preferred stock, and the conversion and exercise of derivative securities, could result in the issuance of a substantial number of additional shares of our Common Stock and substantial dilution to our existing stockholders. Such issuances could also cause the market price of our Common Stock to decline. In addition, the April 2026 Purchase Agreement provides for the potential funding of up to an additional $87,000,000 and the issuance of additional notes and warrants in additional closings, subject to the Purchasers’ discretion and our ability to meet certain conditions, which issuances could also result in substantial dilution to our existing stockholders and also cause the market price of our Common Stock to decline.
A single holder affiliated with a member of our Board of Directors holds shares of Series C Preferred Stock representing substantial voting power, which allows it to exert significant influence over us.
In June 2026, pursuant to the Exchange Agreement, we issued 7,169 shares of Series C Preferred Stock and a warrant to purchase up to 619,084 shares of Common Stock to Index Equity US, LLC, an entity managed by Bjarne Borg, a member of our Board of Directors, in exchange for the extinguishment of approximately $7.2 million of related-party indebtedness. The Series C Preferred Stock votes together with our Common Stock as a single class on an as-converted basis, subject to the applicable beneficial ownership limitation, which is currently set at 4.99% of the number of shares of the Company’s common stock outstanding immediately after giving effect to the issuance of shares of common stock as if such shares of Series C Preferred had been converted but may be increased up to 19.99% at the election of the holder. As a result, Index Equity US, LLC has significant voting power. Additionally, the holders of a majority of the outstanding Series C Preferred Stock have consent rights over certain corporate actions, including the creation of securities ranking senior to or pari passu with the Series C Preferred Stock. As a result, Index Equity US, LLC is able to exert significant influence over matters submitted to a vote of our stockholders and over corporate actions requiring the consent of the Series C Preferred Stock, and its interests may differ from those of our other stockholders.
Beginning on or about September 1, 2026, the April 2026 Notes may be converted into shares of our Common Stock at prices below the prevailing market price, which could result in substantial dilution and could depress the trading price of our Common Stock.
The holders of the April 2026 Notes have the right, at any time after the later of (i) the date of receipt of stockholder approval, which was obtained on June 12, 2026, and (ii) 120 calendar days following the Initial Closing Date (September 1, 2026) to convert their April 2026 Notes, in whole or in part, into shares of Common Stock in an Alternate Conversion at a conversion price equal to the greater of (x) the April 2026 Note Floor Price of $0.534 and (y) 92% of the lowest volume-weighted average price of our Common Stock during the ten trading days preceding the applicable conversion. Because Alternate Conversions are priced at a discount to prevailing market prices, they may result in the issuance of a substantial number of shares of Common Stock at prices below the then-current market price of our Common Stock, would dilute the interests of our existing stockholders, and could place sustained downward pressure on the trading price of our Common Stock, particularly if holders convert and sell shares of Common Stock on a recurring basis. If the price of our Common Stock were to decline to the April 2026 Note Floor Price, the $6,300,000 aggregate principal amount of the Initial April 2026 Notes, without giving effect to accrued interest, would be convertible into in excess of 11 million shares of Common Stock, and the Second April 2026 Notes, if issued, would be subject to the same terms.
We currently do not intend to pay dividends on our Common Stock; consequently, a stockholder’s ability to achieve a return on an investment in our Common Stock will depend on appreciation in the price of our Common Stock.
We have never declared or paid any cash dividends on our Common Stock and do not anticipate paying any cash dividends on our Common Stock in the foreseeable future. The payment of dividends is restricted by the terms of the February 2026 Notes and the April 2026 Notes and may be restricted by the terms of future financings. As a result, a stockholder’s ability to achieve a return on an investment in our Common Stock will depend on appreciation in the price of our Common Stock.
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ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
We did not sell any equity securities during the quarter ended June 30, 2026, in transactions that were not registered under the Securities Act other than as previously disclosed in our filings with the SEC and as described below.
On April 26, 2026, we issued 22,500 restricted shares of our Common Stock to a consultant with a total value of $58,950 for services provided. The shares were issued in reliance on the exemption from registration provided for under Section 4(a)(2) of the Securities Act of 1933, as amended, and/or Section 506 of Regulation D promulgated thereunder.
ITEM 3. Defaults Upon Senior Securities
None.
ITEM 4. Mine Safety Disclosures
Not applicable.
ITEM 5. Other Information
During the second quarter of 2026, none of our directors or executive officers
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ITEM 6. Exhibits
EXHIBIT INDEX
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| + | Filed or furnished herewith. |
| ^ | Management contract or compensatory plan or arrangement |
| * | Exhibits and schedules have been omitted pursuant to Items 601(a)(5) of Regulation S-K. The Company hereby undertakes to furnish copies of any of the omitted exhibits and schedules upon request by the Securities and Exchange Commission. |
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SIGNATURES
Pursuant to the requirements 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.
| Date: August 13, 2026 | RENX ENTERPRISES CORP. | |
| (Registrant) | ||
| By: | /s/ David Villarreal | |
| David Villarreal | ||
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| By: | /s/ Nicolai Brune | |
| Nicolai Brune | ||
| Chief Financial Officer | ||
| (Principal Financial Officer and | ||
| Principal Accounting Officer) | ||
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