UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the quarterly period ended October 31, 2025
OR
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from to
(Exact name of registrant as specified in its charter)
|
|
|
|
||
|
(State or other jurisdiction of incorporation or organization)
|
(Commission File Number)
|
(I.R.S. Employer Identification Number)
|
|
|
|
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Registrant’s telephone number, including area code: (818 )-683-2765
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
||
|
|
|
The
|
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 December 15, 2025, 4,380,012 common shares were issued and outstanding.
DEVVSTREAM CORP.
Quarterly Report on Form 10-Q
|
Page
|
||
|
1
|
||
|
Item 1.
|
1
|
|
| 3 | ||
| 4 | ||
| 5 | ||
| 6 | ||
| 7 | ||
|
Item 2.
|
38
|
|
|
Item 3.
|
60
|
|
|
Item 4.
|
60
|
|
|
62
|
||
|
Item 1.
|
62
|
|
|
Item 1A.
|
62
|
|
|
Item 2.
|
64
|
|
|
Item 3.
|
64
|
|
|
Item 4.
|
64
|
|
|
Item 5.
|
65
|
|
|
Item 6.
|
66
|
|
|
69
|
||
PART I – FINANCIAL INFORMATION
| Item 1. |
Financial Statements
|
DevvStream Corp.
Condensed Consolidated Interim Financial Statements
(Expressed in United States dollars)
For the three months ended October 31, 2025 and 2024
(unaudited)
INDEX TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
|
Page
|
|
| 3 | |
| 4 | |
| 5 | |
| 6 | |
|
7
|
On August 8 2025, the Company effected a 1-for-10 reverse stock split of its outstanding common stock. All share and per share amounts in these
consolidated financial statements and related footnotes have been retroactively adjusted to reflect the reverse stock split for all periods presented, unless otherwise indicated (the “Reverse Stock Split”).
|
DevvStream Corp.
|
|
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
|
|
(Unaudited - Expressed in United States dollars)
|
|
As at
|
October 31,
2025
|
July 31,
2025
|
||||||
|
ASSETS
|
||||||||
|
Current assets
|
||||||||
|
Cash
|
$
|
|
$
|
|
||||
|
Trade receivable
|
||||||||
|
GST receivable
|
|
|
||||||
|
Corporate taxes receivable
|
||||||||
|
Deferred financing costs
|
||||||||
|
Prepaid expenses
|
|
|
||||||
|
Deposit on carbon credits purchase
|
||||||||
|
Carbon credits
|
||||||||
|
Total current assets
|
|
|
||||||
|
Restricted cash
|
|
|
||||||
| Cryptocurrencies – restricted | ||||||||
| Deferred financing costs, long-term |
||||||||
| Deposit on carbon credits purchase, long-term |
||||||||
| Investment in associate |
||||||||
|
Total assets
|
$
|
|
$
|
|
||||
|
LIABILITIES AND SHAREHOLDERS’ DEFICIENCY
|
||||||||
|
Current liabilities
|
||||||||
|
Accounts payable and accrued liabilities
|
$
|
|
$
|
|
||||
|
Accounts payable and accrued liabilities – related parties
|
||||||||
|
Convertible debentures
|
|
|
||||||
|
Derivative liabilities
|
|
|
||||||
|
Warrant liabilities
|
||||||||
|
Stock option liabilities
|
||||||||
|
Stop loss provision liabilities
|
||||||||
|
Total current liabilities
|
|
|
||||||
| Convertible debentures, long term |
||||||||
| Convertible debentures – related parties, long term |
||||||||
| Total liabilities |
||||||||
|
Shareholders’ deficiency
|
||||||||
|
Common shares
(
|
|
|
||||||
|
Additional paid in capital
|
|
|
||||||
| Subscription receivable |
( |
) | ( |
) | ||||
|
Accumulated other comprehensive income
|
|
|
||||||
|
Deficit
|
(
|
)
|
(
|
)
|
||||
|
Total shareholders’ deficiency
|
(
|
)
|
(
|
)
|
||||
|
Total liabilities and shareholders’ deficiency
|
$
|
|
$
|
|
||||
| Going concern (Note 2(b)) |
||||||||
| Commitments and contingencies (Note 17) |
||||||||
| Subsequent events (Note 18) |
||||||||
See accompanying notes to the condensed consolidated interim financial statements.
|
DevvStream Corp.
|
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
|
|
(Unaudited - Expressed in United States dollars)
|
|
For the three months ended October 31,
|
2025
|
2024
|
||||||
| Revenue | $ |
$ | ||||||
| Cost of sales |
( |
) | ||||||
| Gross profit |
( |
) | ||||||
|
Operating expenses
|
||||||||
|
Sales and marketing
|
|
|
|
|
||||
|
Depreciation
|
|
|
||||||
|
General and administrative
|
|
|
||||||
|
Professional fees
|
|
|
||||||
|
Salaries and wages
|
(
|
)
|
|
|||||
|
Total operating expenses
|
(
|
)
|
(
|
)
|
||||
|
Other income (expenses)
|
||||||||
|
Staking income
|
||||||||
|
Interest expense
|
(
|
)
|
(
|
)
|
||||
|
Accretion expense
|
(
|
)
|
(
|
)
|
||||
|
Change in fair value of derivative liabilities
|
(
|
)
|
(
|
)
|
||||
|
Change in fair value of warrant liabilities
|
( |
) | ||||||
|
Change in fair value of mandatory convertible debentures
|
|
|
||||||
|
Stop-loss provision loss
|
(
|
)
|
||||||
|
Equity loss on investment in associate
|
( |
) | ||||||
|
Gain on share settlement
|
( |
) | ||||||
|
Gain on settlement of debt
|
||||||||
|
Loss on revaluation of cryptocurrencies
|
( |
) | ||||||
|
Foreign exchange gain (loss)
|
( |
) | ||||||
|
Net loss
|
$
|
(
|
)
|
$
|
(
|
)
|
||
|
Other comprehensive loss
|
||||||||
|
Foreign currency translation
|
|
|
||||||
|
Net loss and comprehensive loss
|
(
|
)
|
(
|
)
|
||||
|
Weighted average number of shares outstanding - Basic and diluted
|
|
|
||||||
|
Loss per share – Basic and diluted
|
$ | ( |
) | $ | ( |
) | ||
See accompanying notes to the condensed consolidated interim financial statements.
|
DevvStream Corp.
|
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIENCY
|
|
(Unaudited - Expressed in United States dollars)
|
|
Number of Shares
|
Additional
Paid-in Capital
|
Subscription receivable
|
Accumulated Deficit
|
Accumulated
other
comprehensive
income (loss)
|
Total
shareholders’
equity
(deficiency)
|
|||||||||||||||||||
|
Balance, July 31, 2024
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
|||||||||||
|
Share based compensation - RSUs
|
-
|
|
|
|
|
|
||||||||||||||||||
|
Share based compensation - Options
|
-
|
|
|
|
|
|
||||||||||||||||||
|
Warrants reclassified to liabilities on change in functional currency
|
-
|
(
|
)
|
|
|
|
(
|
)
|
||||||||||||||||
|
Shares issued for warrant exercises
|
|
|
|
|
|
|
||||||||||||||||||
|
Conversion of mandatory convertible debentures
|
|
|
|
|
|
|
||||||||||||||||||
|
Shares for settlement of debt
|
|
|
|
|
|
|
||||||||||||||||||
|
Foreign currency translation
|
-
|
|
|
|
|
|
||||||||||||||||||
|
Net loss
|
-
|
|
|
(
|
)
|
|
(
|
)
|
||||||||||||||||
|
Balance, October 31, 2024
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
|||||||||||
|
Balance, July 31, 2025
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
||||||||||
|
Cancellation of shares
|
(
|
)
|
|
|
|
|
|
|||||||||||||||||
|
Share based compensation - RSUs
|
-
|
|
|
|
|
|
||||||||||||||||||
|
Share based compensation - Options
|
-
|
|
|
|
|
|
||||||||||||||||||
|
Shares issued for ELOC drawdown
|
|
|
|
|
|
|
||||||||||||||||||
|
Amortization of deferred financing costs
|
-
|
(
|
)
|
|
|
|
(
|
)
|
||||||||||||||||
|
Foreign currency translation
|
-
|
|
|
|
|
|
||||||||||||||||||
|
Net loss
|
-
|
|
|
(
|
)
|
|
(
|
)
|
||||||||||||||||
|
Balance, October 31, 2025
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
||||||||||
See accompanying notes to the condensed consolidated interim financial statements.
|
DevvStream Corp.
|
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
|
|
(Unaudited - Expressed in United States dollars)
|
|
For the period ended October 31,
|
2025
|
2024
|
||||||
|
Operating activities
|
||||||||
|
Net loss for the period
|
$
|
(
|
)
|
$
|
(
|
)
|
||
|
Items not affecting cash:
|
||||||||
|
Depreciation
|
|
|
||||||
|
Share based compensation
|
|
|
||||||
|
Change in fair value of derivative liabilities
|
|
|
||||||
|
Change in fair value of mandatory convertible debentures
|
|
(
|
)
|
|||||
|
Change in fair value of warrant liabilities
|
( |
) | ||||||
|
Change in fair value of stock option liabilities
|
( |
) | ||||||
|
Staking income
|
( |
) | ||||||
|
Loss on revaluation of cryptocurrencies
|
||||||||
|
Loss on investment in associate
|
||||||||
|
Loss on settlement of accounts payable
|
||||||||
|
Stop-loss provision loss
|
||||||||
|
Accrued interest
|
|
|
||||||
|
Accretion expense
|
|
|
||||||
|
Retirement of carbon credits
|
||||||||
|
Changes in non-cash working capital items:
|
||||||||
|
Trade receivable
|
||||||||
|
GST receivable
|
( |
) | ( |
) | ||||
|
Carbon credits
|
( |
) | ||||||
|
Prepaid expenses
|
(
|
)
|
|
|||||
|
Accounts payable and accrued liabilities
|
(
|
)
|
|
|||||
|
Net cash used in operating activities
|
(
|
)
|
(
|
)
|
||||
|
Investing activities
|
||||||||
|
Purchase of cryptocurrencies
|
( |
) | ||||||
|
Net cash used in investing activities
|
( |
) | ||||||
|
Financing activities
|
||||||||
|
Proceeds from convertible debentures
|
|
|
||||||
|
Proceeds from warrant exercise
|
|
|
||||||
| Proceeds from ELOC drawdown |
||||||||
| Repayment of convertible debentures |
( |
) | ||||||
|
Net cash provided by financing activities
|
|
|
||||||
|
Effect of exchange rate changes on cash
|
|
|
||||||
|
Net decrease in cash
|
(
|
)
|
(
|
)
|
||||
|
Cash, Beginning
|
|
|
||||||
|
Cash, Ending
|
$
|
|
$
|
|
||||
| Presented as: | ||||||||
| Cash |
$ |
$ |
||||||
| Restricted cash |
||||||||
| Cash, Ending |
$ |
$ |
||||||
|
Supplemental information:
|
||||||||
|
Taxes paid
|
$ | $ | ||||||
|
Interest paid
|
$ | $ | ||||||
|
Fair value of warrants exercised
|
$ | $ | ||||||
|
Repayment of convertible debentures from ELOC drawdown proceeds
|
$ | $ | ||||||
See accompanying notes to the condensed consolidated interim financial statements.
|
1.
|
Nature of operations
|
DevvStream Corp. (formerly Focus Impact Acquisition Corp.) (the “Company” or “Devv Corp.”) is a company existing under the Business Corporations
Act of Alberta, Canada. The head office is located at 2133 – 1177 West Hastings Street, Vancouver, BC V6E 2K3 and its records and registered office is located at 2108 N St., Suite 4254, Sacramento, CA 95816.
The Company was a special purpose acquisition corporation incorporated in Delaware, the United States on February 23, 2021, formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more business (“Initial Business Combination”). On November 6, 2024, the Company completed a reverse takeover (“RTO”) with DevvStream Holdings Inc. (“Devv Holdings”) (Note 4) pursuant to a business combination agreement (“BCA”) entered into on September 12, 2023 (and as amended on May 1, 2024, August 10, 2024 and October 29, 2024). The transaction is also referred to as the “De-SPAC” transaction. The Company was redomiciled as an Alberta company as part of the De-SPAC transaction. Devv Holdings is an Environmental Social and Governance (“ESG”) principled, high-tech, impact investing company focused on high quality and high return carbon credit generating projects. Devv Holdings is deemed as the acquirer for accounting purposes, and therefore its assets, liabilities and operations are included in the consolidated financial statements at their historical carrying values. The Company’s operations are considered to be a continuance of the business and operations of Devv Holdings, with the Company’s operations being included from November 6, 2024, the closing date of the De-SPAC transaction, onwards.
The Company is a public company which is listed on the Nasdaq Stock Exchange (“NASDAQ”) under the symbol “DEVS”.
|
2.
|
Basis of preparation
|
|
(a)
|
Statement of compliance
|
These unaudited condensed consolidated interim financial statements have been prepared on a going concern basis in accordance with generally accepted accounting
principles in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions in Article 10 of Regulation S-X promulgated by the U.S. Securities and Exchange Commission (the “SEC”), effective for
the three months ended October 31, 2025.
Certain information or footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted,
pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In
the opinion of management, the accompanying condensed consolidated interim financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results
and cash flows for the periods presented.
The accompanying unaudited condensed consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements
for the year ended July 31, 2025. The interim period results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year.
These unaudited condensed consolidated interim financial statements have been prepared on a historical cost basis. In addition, these condensed consolidated interim
financial statements have been prepared using the accrual basis of accounting, except for the cash flow information.
7
|
2.
|
Basis of preparation (continued)
|
|
(b)
|
Going concern
|
These unaudited condensed consolidated interim financial statements have been prepared on the basis of accounting principles applicable to a going concern, which assume
that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. As at October 31, 2025, the Company has a working capital deficit, has
incurred negative cash flows and losses since inception, and has generated limited revenues to date. The Company’s ability to continue its operations, realize its assets at their carrying values and discharge its liabilities is dependent upon its
ability to raise adequate financing from external sources and generate profits and positive cash flows from operations.
The Company will require additional capital to fund its operations, to evaluate strategic opportunities, and for working capital purposes. However, there is no assurance
that the Company will be able to secure such financing on favourable terms. These matters raise substantial doubt regarding the Company’s ability to continue as a going concern. These unaudited condensed consolidated interim financial statements do
not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Company not continue as a going concern. Such adjustments could be material.
|
(c)
|
Basis of consolidation
|
These unaudited condensed consolidated interim financial statements include the accounts of the Company and entities controlled by the Company. Control exists when the
Company has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. All intercompany balances and transactions, income and expenses have been eliminated upon
consolidation.
As of October 31, 2025, the Company’s subsidiaries were:
|
Name of subsidiary
|
Place of incorporation
|
Ownership
|
|||
|
Devv Holdings
|
% | ||||
|
Devvstream, Inc. (“DESG”)
|
|
% | |||
|
DevvESG Streaming Finco Ltd (“Finco”)
|
|
% | |||
On
November 10, 2022, the Company made an investment into Marmota Solutions Incorporated (“Marmota”). On the date of the initial investment, the Company owned 50 % of Marmota and accounted for the investment as an equity investment. On October 16, 2023, the Company reduced its interest in Marmota to 10 % by returning common shares to Marmota for cancellation in consideration of $19 .
On November 6, 2024, the Company made an investment into Freedom Carbon Solutions LLC (formerly Monroe Sequestration Partners, LLC) (“FCS”). The Company owns
|
(d)
|
Variable interest entities (“VIE”)
|
A VIE is an entity that does not have sufficient equity at risk to finance its activities without additional subordinated financial support or is structured such that
equity investors lack the ability to control the entity's activities or do not substantially participate in the gains and losses of the entity. Upon inception of a contractual agreement, and thereafter, if a reconsideration event occurs, the Company
performs an assessment to determine whether the arrangement contains a variable interest in an entity and whether that entity is a VIE. The primary beneficiary of a VIE is the party that has both the power to direct the activities that most
significantly impact the VIE's economic performance and the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. Where the Company concludes that it is the primary beneficiary of
a VIE, the Company consolidates the accounts of that VIE.
8
|
2.
|
Basis of preparation (continued)
|
|
(e)
|
Functional and presentation currencies
|
Effective August 1, 2024, the Company reassessed its functional currency and the functional currency of its subsidiaries due to changes in underlying transactions,
events, and conditions. As a result of this reassessment, the Company determined that its functional currency changed from the Canadian dollar (“CAD$”) to the United States dollar (“US$”) for Devv Holdings and DESG. Finco’s functional currency
remained CAD$. This change aligns with the business's future focus and the effective date of the Devv Corp.'s Form S-4 Registration Statement with the SEC, a crucial part of the De-SPAC transaction closing. The change in functional currency was
accounted for prospectively from August 1, 2024, with no impact on prior year comparative information. Upon the change in functional currency on August 1, 2024, 121,995 of the Company’s warrants which had strike prices denominated in CAD$ were reclassified as warrant liabilities (Note 11). Determining the functional currency involved significant
judgments to assess the primary economic environment in which the Company operates, including factors such as the currency of underlying transactions, the location of key operations, and the currency of expected cash flows.
The Company’s presentation currency is and continues to be the United States dollar.
|
(f)
|
Use of estimates and judgments
|
In preparing these condensed consolidated interim financial statements, management has made judgements, estimates and assumptions that affect the applicability of the
Company’s accounting policies. In preparing these condensed consolidated interim financial statements, the significant estimates and critical judgments were the same as those applied to the audited consolidated financial statements as at and for the
year ended July 31, 2025.
|
(g)
|
Emerging growth company
|
The Company will be an “Emerging Growth Company”, as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the
Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it has taken advantage of certain exemptions that are not applicable to other public companies that are not emerging growth companies including, but not limited to, not being required
to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and
exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b) (1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until
private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial reporting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.
The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates
for public and private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.
9
|
3.
|
Significant accounting policies
|
The significant accounting policies applied in the preparation of these condensed
consolidated interim financial statements are consistent with the accounting policies disclosed in the Company’s audited consolidated financial statements for the year ended July 31, 2025.
The following accounting policies have been updated or included to reflect transactions
occurring during the current interim period:
|
(a)
|
Cryptocurrencies
|
The Company accounts for cryptocurrencies as indefinite-lived intangible assets in
accordance with ASC 350-60. Cryptocurrencies are initially recorded at cost and subsequently measured at fair value at each reporting date based on quoted prices in active markets, with changes in fair value recognized in earnings in accordance
with ASC 350-60-35 and ASC 820. Cryptocurrencies are not amortized.
Cryptocurrency holdings are classified as non-current assets when they are restricted as
collateral for long-term obligations or when the Company does not expect to liquidate the assets within twelve months, consistent with ASC 210-10-45. The Company may delegate certain cryptocurrency holdings to blockchain validators to earn staking
rewards; such delegation does not result in derecognition of the underlying tokens because the Company retains control of the assets. Staking rewards are recognized in earnings when earned and measured at fair value on the date earned.
| 4. |
Reverse takeover
|
On September 12, 2023 (and as amended on May 1, 2024, August 10, 2024 and October
29, 2024), the Company entered into a Business
Combination Agreement (“BCA”) with Devv Holdings.
Pursuant to the BCA, on November 6, 2024, the Company changed its jurisdiction from
the State of Delaware under the Delaware General Corporation Law to the Province of Alberta, Canada, and thereby became a company existing under the Business Corporations Act of Alberta, and changed its name to Devvstream Corp., and Devv Holdings
was amalgamated with a wholly owned subsidiary of the Company to form one corporate entity.
Under the BCA, the Company consolidated all of its issued and outstanding common
stock on a 1:0.9692 basis. All the outstanding Devv Holdings subordinate voting shares (“SVS”) were exchanged for common stock of the
Company on a common conversion ratio of 0.152934 (the “Common Conversion Ratio”). All the outstanding Devv Holdings multiple voting
shares (“MVS”), being the equivalent of 10 SVS, were exchanged for common stock of the Company on the basis of the Common Conversion
Ratio. In addition, all of the outstanding convertible securities of Devv Holdings were exchanged for securities of the Company on the basis of the Common Conversion Ratio, with corresponding adjustments to exercise prices, and otherwise on
substantially the same economic terms and conditions. The De-SPAC transaction was completed on November 6, 2024.
Historical presentation of number of shares, warrants, options, and RSUs
outstanding, weighted average number of shares outstanding, and exercise price of equity instruments, that are presented elsewhere in the condensed consolidated financial statements, including the condensed consolidated balance sheets, condensed
consolidated statements of operations and comprehensive loss, condensed consolidated statements of changes in shareholders’ deficiency, and Note 10 and 13, are retrospectively adjusted to reflect the application of the Common Conversion Ratio, with
exercise price of warrants and options, and conversion price of convertible debentures adjusted by the inverse of the Common Conversion Ratio. This is further adjusted by a reverse stock split that took place on August 8, 2025.
10
| 4. |
Reverse takeover (continued)
|
In consideration for the De-SPAC transaction, the Company issued 465,747 common shares to the former holders of SVS of Devv Holdings and 711,140 common shares to the former holders of MVS of Devv Holdings. The former shareholders of the Company retained 515,920
shares. The fair value per share was estimated to be $6.10 (CAD$8.50 ) based on the last trading price of Devv Holdings on the Cboe Exchange.
As at November 6, 2024, the Company had 22,699,987 warrants outstanding, each exercisable at $1.52 for 0.09692 common shares, expiring on November 6, 2029. The fair value of the warrants was estimated to be $7,196,286 based on the Black-Scholes Option Pricing Model using the following assumptions: share price – $0.61 , expected dividend yield – 0 %, expected volatility – 87 %, risk-free interest rate – 3.12 % and
an expected remaining life – 5 years . Expected volatility was estimated by using the average of historical volatility of Devv Holdings
and of public traded companies that the Company considers to be comparable. The expected warrant life represents the period of time that warrants granted are expected to be outstanding. The risk-free interest rate is based on Canadian government
bonds with a remaining term equal to the expected life of the warrants.
Immediately after the completion of the De-SPAC transaction, the former holders of
Devv Holdings’ shares owned 70 % of the shares of the combined entity. As a result of the De-SPAC transaction, the former shareholders of
Devv Holdings acquired control of the Company, thereby constituting an RTO of the Company. The RTO was determined to be a purchase of the Company’s net assets by the shareholders of Devv Holdings.
The De-SPAC transaction was accounted for as a capital transaction of Devv
Holdings and equivalent to the issuance of shares by Devv Holdings for the net assets of the Company accompanied by a recapitalization as the Company did not qualify as a business according to the definition of ASC Topic 805, Business Combinations, and met the definition of a non-operating public shell. As a result, the transaction has been accounted for as an asset acquisition with Devv Holdings being identified as the acquirer
and the Company being treated as the accounting acquiree with the transaction being measured at the fair value of the equity consideration issued to the Company’s shareholders. Devv Holdings is the continuing entity.
The excess of the fair value of the shares issued over the value of the net
monetary assets acquired has been recognized as a reduction in equity.
The purchase price is allocated as follows:
|
Fair value of shares retained by former shareholders of the Company (
|
$
|
|
||
|
Fair value of replacement warrants of the Company
|
|
|||
|
Total consideration
|
$
|
|
||
|
|
||||
|
Net assets (liabilities) acquired of the Company:
|
||||
|
Cash and cash equivalents
|
$
|
|
||
|
Accounts payable and accrued liabilities
|
(
|
)
|
||
|
Promissory note payable (Note 10)
|
(
|
)
|
||
|
Total net assets (liabilities)
|
$
|
(
|
)
|
|
|
|
||||
|
Reduction to additional paid in capital as a result of the recapitalization
|
$
|
|
11
| 4. |
Reverse takeover (continued)
|
Sponsor side letter
In connection with the De-SPAC transaction, Focus Impact Sponsor entered into a sponsor side letter, and agreed to certain transfer and lock-up restrictions of the Company’s common stock, which would terminate upon the earlier of: (i) 360 days after November 6, 2024; (ii) a liquidation, merger, capital stock exchange, reorganization, or other similar transaction that results
in all of the Company’s stockholders having the right to exchange their equity for cash, securities or other property; or, (iii) if the Company’s common stock has a closing price of at least $120 per share for any 20 trading days in a 30-day trading period starting from April 5, 2025. Focus Impact Sponsor also agreed to vote its shares in favor of the RTO.
Registration rights agreement
In connection with the De-SPAC transaction, on November 6, 2024, the Company, Focus Impact Sponsor, and certain historical holders of Devv Holdings securities entered into an Amended and Restated Registration Rights Agreement,
pursuant to which, among other things, the historical holders of Devv Holdings securities and Focus Impact Sponsor will be granted customary registration rights with respect to the securities of the Company that they hold.
Indemnification agreements
In connection with the De-SPAC
transaction, on November 6, 2024, the Company entered into indemnification agreements with each of its directors and executive officers. Each indemnification agreement provides for indemnification and advancements by the Company of certain
expenses, including attorney’s fees, judgments, fines, and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of the Company’s directors or executive officers or
as a director or executive officer of any other company or enterprise to which the person provides services at the Company’s request.
|
5.
|
Carbon credits
|
Between October 17, 2024 and October 28, 2024, Devv Holdings entered into multiple agreements to acquire carbon credits in
return for shares of the Company once the De-SPAC Transaction was completed. On November 6, 2024, concurrent with the completion of the business combination, the Company issued 324,987 common shares in consideration for these agreements. The fair value of the shares issued was $1,982,424 .
Stop-loss provision
All of the agreements contain adjustment clauses whereby if the Company’s share price falls below the respective purchase
prices outlined in the agreements, in the next 12 to 18 months, the Company is obligated to issue additional shares to cover the shortfall. The Company has assessed that the potential liability associated with the stop-loss provision for carbon credits received as of
October 31, 2025 is $1,094,765 .
Deposit on carbon credits
Consideration paid of $421,403
related to the future delivery of carbon credits is recorded as a deposit on carbon credits, of which $271,403 relate to a contract
containing a stop-loss provision. The stop-loss provision related to these contracts has not been recognized. As there is not yet certainty to the delivery of the credits, the obligation to issue additional shares is not probable as at October 31,
2025.
12
|
5.
|
Carbon credits (continued)
|
Retirement of carbon credits
On June 20, 2025, the Company entered into an agreement to purchase
|
6.
|
Cryptocurrencies
|
The Company holds cryptocurrency assets and related cash balances with Bitgo Trust Company, Inc., a cryptocurrency exchange which is a South Dakota chartered trust company. These holdings are subject to collateral requirements associated with the Company’s convertible debentures issued to Helena, the proceeds of which were used to fund the Bitgo account (Note 10).
Under the terms of this financing arrangement, all cryptocurrency and cash maintained with Bitgo are restricted to secure the Helena convertible debt until the fair value of the Company’s cryptocurrency holdings exceeds US$20 million (the “Threshold Amount”). Helena also maintains first preference claim on the Company’s assets until the Threshold Amount is met. Once the Threshold Amount is achieved, only cryptocurrency holdings up to US$20 million in a segregated account remain pledged as security; however, as of October 31, 2025, the Threshold Amount had not been met, and all cryptocurrency and cash balances remained fully restricted.
Cryptocurrencies are accounted for as indefinite-lived intangible assets in accordance with ASC 350-60 and are subsequently measured at fair value, with changes in fair value recognized in earnings in accordance with ASC 350-60-35 and ASC 820. Fair value is determined using quoted prices in active markets.
|
|
Bitcoin
|
Solana
|
Total
|
|||||||||
|
Balance, August 1, 2025
|
$
|
|
$
|
|
$
|
|
||||||
|
Purchases
|
|
|
|
|||||||||
|
Staking income earned
|
|
|
|
|||||||||
|
Fair value loss
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
|
Balance, October 31, 2025
|
$
|
|
$
|
|
$
|
|
||||||
As at October 31, 2025, the Company held
13
|
6.
|
Cryptocurrencies (continued)
|
The Company participates in staking activities for Solana. Staked Solana remains
recognized as an asset of the Company because delegation to validators does not transfer control of the underlying tokens, and the criteria for derecognition under ASC 350-10-40 are not met. Staking rewards are recognized in earnings when earned
and measured at fair value on the date earned. During the period, the Company earned 70.66 SOL, with a total fair value of $14,334 .
|
7.
|
Investment in associate
|
On November 6, 2024, the Company received 2,000,000
shares in FCS, in connection with an agreement to acquire a stake in FCS in exchange for 200,000 shares of the Company that was entered
into on October 28, 2024. At the time of acquisition, the 2,000,000 shares of FCS received by the Company represented 50 % of shares outstanding, and the initial balance of investment was determined to be $1,220,000 being the fair value of the shares issued by the Company in consideration for the exchange. As at October 31, 2025, the Company’s share of ownership remained at 50 %. Management assessed that the Company has significant influence over FCS based on its share of ownership, and that the investment should be
accounted for using the equity method of accounting.
Summarized financial information of FCS and a reconciliation of the carrying amount of the investment set forth in the consolidated
balance sheets are set out below:
Summarized balance sheet
|
|
October 31, 2025
|
|||
|
ASSETS
|
||||
|
Cash
|
$
|
|
||
|
Due from
|
|
|||
|
Start-up costs, net
|
|
|||
|
Total assets
|
$
|
|
||
|
|
||||
|
LIABILITIES
|
||||
|
Accounts payable and accrued liabilities
|
$
|
|
||
|
Convertible notes
|
|
|||
|
Total liabilities
|
$
|
|
||
Summarized statement of loss
|
|
For the three months ended
October 31, 2025
|
|||
|
Operating expenses
|
||||
|
General and administrative expenses
|
$ |
|
||
| Guaranteed payments |
||||
|
Legal and professional fees
|
|
|||
| Travel |
||||
|
Amortization
|
|
|||
|
Total operating expenses
|
(
|
)
|
||
|
|
||||
|
Interest expenses
|
(
|
)
|
||
|
Net loss
|
$
|
(
|
)
|
|
| Company’s ownership |
% | |||
| Company’s share of loss |
$ |
( |
) | |
14
|
7.
|
Investment in associate (continued)
|
A continuity of the Company’s investment in associate is as follows:
|
Balance as at July 31, 2024
|
$
|
|
||
|
Investment by the Company
|
|
|||
|
Company’s share of loss
|
(
|
)
|
||
|
Balance as at July 31, 2025
|
$
|
|
||
| Company’s share of loss |
( |
) | ||
|
Balance as at October 31, 2025
|
$ |
| 8. |
Equity Line of Credit (“ELOC”)
|
On October 29, 2024, the
Company entered into the ELOC Agreement with Helena Global Investment Opportunities I Ltd (“Helena I”). Under the ELOC Agreement, the Company will have the right to issue and to sell to Helena I from time to time, up to $40,000,000 of the Company’s common shares following the closing of the De-SPAC Transaction and the effectiveness of the registration statement registering
the Company’s common shares being sold under the ELOC Agreement (the “Helena I Registration Statement”). As a commitment fee in connection with the execution of the ELOC Agreement, 50,000 shares of the Company was issued upon closing of the De-SPAC transaction. Following the closing of the
De-SPAC Transaction and the Helena I Registration Statement becoming effective, the Company issued to Helena I common shares equal to $125,000
divided by the greater of (i) the lowest one-day VWAP during the trading days immediately preceding the effectiveness date of such
Registration Statement and (ii) $7.50 . On March 17, 2025, the Company issued 16,666 shares in satisfaction of this obligation.
The Company may require that Helena purchase the Company’s common shares by delivering one or more advance notices to Helena setting forth, in each advance notice, the amount of advance it is requesting, which amount may not exceed an amount equal to the lesser of (i)
On March 18, 2025, the Company and Helena entered into
a first amendment to ELOC Agreement, which allows Helena to permit Secondary Advances, as defined in the amendment, as well as to update references to “Common Stock” in the ELOC Agreement to “Common Shares”. On August 4, 2025, the
Company and Helena entered into a second amendment to ELOC Agreement, which increased the commitment amount from $40,000,000 to $300,000,000 .
On December 3, 2025, the Company entered a side letter with Helena I, amending the terms of the
Company’s existing convertible note and ELOC Agreement. The amendment places temporary limits on Helena’s sales of conversion shares, subject to trading-volume conditions, and requires the Company to submit advance notices sufficient to receive at
least $7,500,000 in net proceeds under the ELOC prior to February 28, 2026 (Note 18).
As at October 31, 2025, $4,084,681 have been drawn against the ELOC through the issuance of 1,145,700
shares. During the three months ended October 31, 2025, $756,600 has been drawn against the ELOC through the issuance of 300,000 shares (Note 13).
15
| 9. |
Accounts payable and accrued liabilities
|
|
October 31, 2025
|
July 31, 2025
|
|||||||
|
Accounts payable
|
$
|
|
$
|
|
||||
|
Accrued liabilities
|
|
|
||||||
| Excise taxes payable |
||||||||
|
Income taxes payable
|
|
|
||||||
|
|
|
|
|
|||||
| Accounts payable, related parties | ||||||||
| Accrued liabilities, related parties | ||||||||
| $ | $ | |||||||
| 10. |
Convertible debentures
|
Devvio Tranche (Related Party Convertible Debt)
On January 12, 2024, the Company closed an unsecured convertible notes offering in the principal amount of $100,000 with Devvio that will bear interest at a rate of 5.3 %
per annum, is payable at maturity, subject to acceleration if the Company completes the De-SPAC transaction and the debentures are not converted. The maturity was November 6, 2024. The Company has the right to prepay the whole or any portion of
the principal amount, and together with any accrued interest, at any time prior to the maturity date without notice or a penalty payment. Devvio is a related party to the Company through its ownership of the Company’s shares, and one of Devvio’s
officers, directors and principal owners was a director of the Company during the year ended July 31, 2024 and until November 7, 2024.
In the event the Company completes a De-SPAC transaction, the principal amount and accrued interest are convertible into SVS of the Company at the option of the
lender, as follows:
| • |
At a conversion price equal to the greater of (a) $
|
| • |
If the Company completes the De-SPAC transaction, and the convertible notes are not converted into shares, the maturity date will accelerate and the principal plus interest will become repayable within
|
In the event the Company does not complete a De-SPAC transaction at the later of October 8, 2024 (270 days from the issuance date of the notes) and the termination of the business combination agreement for the De-SPAC transaction, the principal and accrued interest are
convertible into units consisting of one SVS and of a share purchase warrant, at the option of the lender, as follows:
| • |
At a conversion price equal to the greater of (a) the
|
| • |
Each warrant will carry the right to purchase a share with an exercise price equal to the greater of (a) a
|
The conversion price is subject to certain anti-dilution provisions.
At issuance, the Devvio Tranche convertible debentures were determined to be a financial instrument comprising a host debt component and a conversion
feature which is an embedded derivative that required bifurcation. On initial recognition, the embedded derivative was valued first, and the residual value was assigned to the host financial debt component. The fair value of the derivative
liability at issuance was estimated to be $45,000 using the Monte Carlo model.
16
|
10.
|
Convertible debentures (continued)
|
The prepayment option and the accelerated repayment condition were not separately accounted for as they were determined to be clearly and
closely related to the host contract.
On November 6, 2024, the Company completed the De-SPAC transaction (Note 4), and accordingly, the conversion terms of the principal amount and accrued interest
crystalized such that they are convertible, at the option of the lender, at a conversion price of $11.70 (being $76.50 multiplied by the Common Conversion Ratio). If the convertible notes are not converted into shares, the principal plus interest will become
repayable within 10 days after the closing of the De-SPAC transaction.
Upon the crystallization of the conversion price, the conversion option met the definition of equity under Topic 815 and bifurcation is no longer required. The
fair value of the conversion option was remeasured on November 6, 2024 to be $176,000 and was transferred into equity. The fair value
was estimated using the Black-Scholes Option Pricing model using the following assumptions: expected dividend yield - 0 %, expected
volatility - 275 %, risk-free interest rate - 3.10 % and an expected remaining life - 0.6 years.
On November 12, 2024, the maturity of the Devvio Tranche was extended to May 30, 2025. As there was no change to the cash flows as a result of this change, the 10%
test was not met and therefore, there was no extinguishment of the debt as a result of this change. The Devvio Tranche is outstanding as of October 31, 2025, and the Company is in the process of negotiating a further extension.
Focus Impact Partners Convertible Debt (Related Party Convertible Debt)
In the prior year, the Company closed an unsecured convertible notes offering with Focus Impact Partners, LLC (“Focus Impact
Partners”). Subsequent to the closing of the De-SPAC transaction, Focus Impact Partners became a related party of the Company as one of the directors of the Company is an officer of Focus Impact Partners. The convertible notes were
initially closed on January 12, 2024 and additional advances were added under the same offering. The total initial principal amounts of $550,000
under the original Focus Impact Partners Convertible Debt were received in five installments: $150,000 on November 6, 2023, $150,000
on January 9, 2024, $100,000 on March 28, 2024, $100,000 on April 19, 2024, and $50,000 on June 13, 2024. The debentures will bear interest at a rate
of 5.3 % per annum, payable at maturity, subject to acceleration if the Company completes the De-SPAC transaction (Note 4) and the
debentures are not converted. The maturity date for all advances was November 6, 2024. The Company has the right to prepay the whole or any portion of the principal amount, together with any accrued interest, at any time prior to the maturity
date without notice or a penalty payment.
In the event the Company completes a De-SPAC transaction, the principal amount and accrued interest are convertible into SVS of the Company at the option of the
lender, as follows:
| • |
At a conversion price equal to the greater of (a) a
|
| • |
The shares are thereafter exchanged for common shares of the Company at the Common Conversion Ratio.
|
| • |
If the Company completes the De-SPAC transaction, and the convertible notes are not converted into shares, the maturity date will accelerate and the principal plus interest will become repayable within
|
In the event the Company does not complete a De-SPAC
transaction at the later of October 8, 2024 (270 days from the issuance date of the notes), or the termination of the BCA with Focus
Impact, the principal and accrued interest are convertible into units consisting of one SVS and of a share purchase warrant, at the option of the lender, as follows:
17
|
10.
|
Convertible debentures (continued)
|
| • |
At a conversion price equal to the greater of (a) a
|
| • |
Each warrant will carry the right to purchase a share with an exercise price equal to the greater of (a) a
|
| • |
The warrants will expire
|
The conversion price is subject to certain anti-dilution provisions.
On June 28, 2024, the Company and Focus Impact Partners agreed to amend the Focus Impact Partners Convertible Debt (“the June 2024 Amendment”) such
that the De-SPAC Floor Price would be amended from $20.00 to CA$4.75 .
On June 28, 2024, the Company received additional proceeds of $20,000 under the June 2024 Amendment.
On August 19, 2024, October 18, 2024, October 28, 2024 and November 1, 2024, the Company received additional proceeds of $41,500 , $6,500 , $7,650 and $12,000 under the June 2024
Amendment.
The
Focus Impact Partners Convertible Debt were determined to be a financial instrument comprising a host debt component and a conversion feature which is an embedded derivative that required bifurcation. On initial recognition, the embedded
derivative was valued first, and the residual value was assigned to the host financial debt component. The total fair value of the derivative liabilities at the various issuance dates for the proceeds received during the year ended July 31,
2024 was estimated to be $25,800 as valued using the Monte Carlo model. The total fair value of the derivative liabilities at the
various issuance dates for the proceeds received during the year ended July 31, 2025 was estimated to be $65,750 as valued using
the Monte Carlo model.
The June 2024 Amendment had no impact on the classification of the convertible debenture and therefore, the conversion feature was considered a
derivative before and after the modification. As there was no change to the host instrument cash flows as a result of this change, the 10% test was not met and therefore, there was no extinguishment of the host debt as a result of this change.
As the conversion option was bifurcated before and after the modification, the change in the fair value of the conversion feature was recognized as
the loss on revaluation of the derivative liabilities through the consolidated statement of operations and comprehensive loss.
The prepayment option and the accelerated repayment condition were not separately accounted for as they were determined to be clearly and closely
related to the host contract.
On November 13, 2024, the Company issued a new $637,150
convertible note bearing interest of 5.3 % per annum, with a maturity date of November 13, 2026 (“New Focus Impact Partners
Convertible Debt”), in exchange for the cancellation of the Focus Impact Partners Convertible Debt as described above (the “November 2024 Amendment”). The principal loan amount and any accrued interest under the New Focus Impact Partners
Convertible Debt are convertible into common stock of the Company at the option of the holder at a 25 % discount to the 20-day volume weighted average price of the Company’s shares, subject to a floor of $8.67 per share. The Company retains the right to prepay the whole or any portion of the principal amount, together with any accrued interest, at any time prior to the maturity date
without notice or a penalty payment.
18
|
10.
|
Convertible debentures (continued)
|
Accrued interest on the previously existing Focus Impact Partners Convertible Debt, amounting to $21,129 , were not converted into the New Focus Impact Partners Convertible Debt, and were transferred to accrued liabilities of the Company.
As a result of the November 2024 amendment, the conversion option met the definition of equity under Topic 815 and bifurcation is no longer required. As the
conversion option was bifurcated before the amendment but not bifurcated after the amendment, a change in the fair value of the conversion option of over 10 % of the of the carrying amount of the original debt without the bifurcation at inception constitutes a substantial change. Immediately prior to the November 2024 Amendment, the value of the conversion
feature associated with the Focus Impact Partners Grid Note was $2,250,000 . The fair value of the conversion feature was $59,000 after the November 2024 Amendment as estimated using the Monte Carlo model. With the 10 % test being met, extinguishment accounting was applied. The carrying value of the old debt of $637,650 was derecognized and the fair value of the new debt of $544,441
(based on a 14 % market yield) was recognized. The fair value of the conversion feature of $59,000 was transferred to equity. As Focus Impact Partners is a related party, the gain on the extinguishment of $93,209 was recognized in equity as a capital transaction pursuant to ASC 470-50-40-2.
Envviron Tranche (Related Party Convertible Debt)
On April 23, 2024, the Company closed an unsecured convertible note offering in the principal amount of $250,000 with Envviron SAS (a company controlled by a former director of the Company) that will bear interest at a rate of 5.3 % per annum, payable at maturity, subject to acceleration if the Company completes the De-SPAC transaction and the debentures are not converted
(“Envviron Tranche”). The maturity date was February 15, 2025. The Company has the right to prepay the whole or any portion of the principal amount, and together with any accrued interest, at any time prior to the maturity date without notice or
a penalty payment. The terms of the Envviron Tranche are identical to the original Focus Impact Partners Convertible Debt.
In the event the Company completes a De-SPAC transaction, the principal amount and accrued interest are convertible into SVS of the Company at the option of the
lender, as follows:
| • |
At a conversion price equal to the greater of (a) the price that is a
|
| • |
If the Company completes the De-SPAC transaction, and the convertible notes are not converted into shares, the maturity date will accelerate and the principal plus interest will become repayable within
|
In the event the Company does not complete a De-SPAC transaction at the later of January 18, 2025 (270 days from the issuance date of the notes) and the termination of the BCA for the De-SPAC transaction, the principal and accrued interest are convertible into units
consisting of one SVS and
of a share purchase warrant, at the option of the lender, as follows:
| • |
At a conversion price equal to the greater of (a) the price that is a
|
| • |
Each warrant will carry the right to purchase a share with an exercise price equal to the greater of (a) a
|
The conversion price is subject to certain anti-dilution provisions.
19
|
10.
|
Convertible debentures (continued)
|
The Envviron Tranche convertible debentures were determined to be a financial instrument comprising a host debt component and a conversion feature
which is an embedded derivative that required bifurcation. On initial recognition, the embedded derivative was valued first, and the residual value was assigned to the host financial debt component. The fair value of the derivative liability at
issuance was estimated to be $2,750 using the Monte Carlo model.
The prepayment option and the accelerated repayment condition were not separately accounted for as they were determined to be clearly and
closely related to the host contract.
On November 6, 2024, the Company completed the De-SPAC transaction (Note 4), and accordingly, the conversion terms of the principal amount and accrued interest
crystalized such that they are convertible, at the option of the lender, at a conversion price equal to the greater of (a) the price that is a 25 %
discount to the 20-day VWAP of the shares on the NASDAQ, and (b) $20.00 . If the convertible notes are not converted into shares, the principal plus interest will become repayable within 10 days after the closing of the De-SPAC transaction.
Upon the crystallization of the conversion price, the conversion option met the definition of equity under Topic 815 and bifurcation is no longer required. The
fair value of the conversion option was remeasured on November 6, 2024 to be $31,000 and was transferred into equity. The fair value was estimated using the Monte Carlo model.
On November 12, 2024, the maturity of the Envviron Tranche are extended to May 30, 2025. As there was no change to the cash flows as a result of this change, the
10% test was not met and therefore, there was no extinguishment of the debt as a result of this change. The Envviron Tranche is outstanding as of October 31, 2025, and the Company is in the process of negotiating a further extension.
Debt Assumed on RTO
Upon the completion of the De-SPAC transaction (Note 4), the Company assumed two unsecured promissory notes amounting to $3,000,000 issued to Focus
Impact Sponsor, LLC (the “Focus Impact Sponsor”), a significant shareholder of the Company. The promissory notes were interest-free and had a maturity date on the completion of the De-SPAC transaction (Note 4). Upon the completion of the
De-SPAC transaction, $1,500,000 of the promissory notes was convertible into warrants of the Company at a price of $1.00 per warrant. The Company also assumed $345,000
of accrued administrative fees owing to Focus Impact Partners.
On November 13, 2024, the Company issued new convertible notes totaling $3,345,000 , bearing interest of 5.3 % per annum, with a maturity date of
November 13, 2026 (“New Convertible Debt”), in exchange for the cancellation of the assumed debt described above.
The principal loan amount and any accrued interest under the New Convertible Debt are convertible into common stock of the Company at the option of the holder at a
25 % discount to the 20-day
volume weighted average price of the Company’s shares, subject to a floor of $8.67 per share. The Company has the right to prepay the
whole or any portion of the principal amount, together with any accrued interest, at any time prior to the maturity date without notice or a penalty payment.
20
|
10.
|
Convertible debentures (continued)
|
As the conversion feature was not bifurcated before and after the amendment, a difference in the present value of cash flows under the terms of the new debt
instrument of at least 10 % from the present value of the remaining cash flows under the terms of the original debt instrument
constitutes a substantial change. The change was assessed to be in excess of 10 %. With the 10 % test being met, extinguishment accounting was applied. The carrying value of the old debt of $3,345,000 was derecognized and the fair value of the new debt of $2,856,042
(based on a 14 % market yield) was recognized. As Focus Impact Partners and the Focus Impact Sponsor are related parties, the gain on
the extinguishment of $488,957 was recognized in equity as a capital transaction pursuant to ASC 470-50-40-2.
In connection with the New Focus Impact Partners Convertible Debt and the New Convertible Debt, the Company agreed (i) to grant the Secured Parties a first ranking
security interest in all of the carbon credits and similar environmental assets held by the Company, presently existing or hereafter created or acquired, and (ii) to execute and deliver to the Secured Parties a security agreement evidencing the
Secured Parties’ security interest (the “Security Agreement”). On December 18, 2024, the Company executed and delivered to the Secured Parties the Security Agreement.
Additional Focus Impact Partners Convertible Debt (Related Party Convertible Debt)
On March 19, 2025, the Company closed a convertible note offering in the
principal amount of $218,000 with Focus Impact Partners that will bear interest at a rate of 5.3 % per annum, with a maturity date of March 19, 2027 (“Additional Convertible Debt”).
The principal loan amount and any accrued interest under the Additional
Convertible Debt are convertible into common stock of the Company at the option of the holder at a 25 % discount to the 20-day volume weighted average price of the Company’s shares. The Company has a right to prepay the whole or any portion of the principal amount,
together with any accrued interest, at any time prior to the maturity date without notice or a penalty payment.
Due to the absence of a floor conversion price, the Additional Convertible
Debt was determined to be a financial instrument comprising a host debt component and a conversion feature which is an embedded derivative that required bifurcation. On initial recognition, the embedded derivative was valued first, and the
residual value was assigned to the host financial debt component. The fair value of the derivative liabilities at issuance was estimated to be $72,500
as valued using the Monte Carlo model. The fair value of the derivative liabilities as at October 31, 2025 was estimated to be $74,000
as valued using the Monte Carlo model.
Crypto Strategy Convertible Debt
On July 17, 2025, the Company entered into a securities purchase agreement
with Helena for the issuance of up to fifty-nine tranches of convertible notes (“Crypto Strategy Convertible Debt”) for a total
principal amount of $300,000,000 , with closings of each tranche subject to fulfillment of conditions. Each tranche will have an
issuance discount of 8 %, and bear interest at a rate of 8 % per annum, with a maturity date of 18 months from the
date of funding. Interest shall be payable by the Company on the first day of each month. At the option of the Company, the interest is payable in cash, through the issuance of additional notes, or under certain situations, through the
issuance of common shares. The Crypto Strategy Convertible Debt ranks senior to all outstanding and future indebtedness of the Company. The securities purchase agreement will terminate automatically on July 17, 2027.
The principal loan amount and any accrued interest under the Crypto Strategy
Convertible Debt in issuance are convertible into common stock of the Company at the option of the holder at 95 % of the lowest
daily volume weighted average price of the Company’s shares during the 5 preceding trading days, subject to a floor price of $0.7722 , and a cap price of $7.722 .
21
|
10.
|
Convertible debentures (continued)
|
If
the Company issues any debt or equity, the lenders have the option to cause the Company to direct 25 % of aggregate proceeds of
such issuances to repay the Crypto Strategy Convertible Debt. The Company has a right to prepay the whole or any portion of the principal amount, together with any accrued interest, at any time prior to the maturity date. A 10 % prepayment penalty is applied on any repayments prior to the maturity date.
During the period ending on the later of (i) 12 months after the closing date
of the initial tranche of the Crypto Strategy Convertible Debt, and (ii) the termination of the securities purchase agreement for the Crypto Strategy Convertible Debt, if the Company offers new securities for sale, the lenders have first
refusal to up to 25 % of the new securities being offered.
The proceeds of the Crypto Strategy Convertible Debt are subject to
restrictions of use, with 70 % of the net proceeds of the initial tranche, and 75 % of the net proceeds of the subsequent tranches are required to be used to purchase cryptocurrencies. Until such time as the Company’s aggregate acquisition of
cryptocurrencies equal or exceeds $20,000,000 (the “Digital Asset Threshold Amount”), the Crypto Strategy Convertible Debt will be
secured by a first preference perfected security interest in all of the existing and future assets of the Company and its direct and indirect subsidiaries, including all of the capital stock of each of the subsidiaries and cryptocurrencies
purchased with the proceeds of the Crypto Strategy Convertible Debt, as evidenced by a security agreement. Subject to certain exceptions contained in the purchase agreement for the Crypto Strategy Convertible Debt, upon the Company’s
achievement of the Digital Asset Threshold Amount, the parties have agreed to amend the terms of the security agreement such that the Company’s obligations shall thereafter be secured exclusively by the cryptocurrencies held in the designated
collateral control account.
Currently, as the Digital Asset Threshold Amount is not yet met, the Crypto
Strategy Convertible Debt is secured by up to $20,000,000 of proceeds from the Crypto Strategy Convertible Debt, held in a
segregated account for trading in cryptocurrencies. The segregated account is subject to a crypto control account agreement, which requires lenders’ approval for actions taken in the segregated account.
On July 17, 2025, the Company closed the initial tranche of the Crypto
Strategy Convertible Debt in the principal amount of $10,000,000 , for gross proceeds of $9,200,000 , with a maturity date of January 17, 2027 . The
Company also incurred $85,000 in transaction costs in connection with the issuance. $6,405,000 of net proceeds are intended for the purchase of cryptocurrencies. As of October 31, 2025, $1,280,000 are held as cash in a segregated account, and are thus presented as restricted cash in the consolidated balance sheet and $5,125,000 has been used for purchase of cryptocurrencies (Note 6).
In connection with entering into the Crypto Strategy Convertible Debt, the
Company entered into a registration rights agreement (the “RRA”), pursuant to which, the Company agreed to register for resale the common shares that are issuable upon conversion of the Crypto Strategy Convertible Debt. If the registration
statement covering the resale of the common shares is not filed or declared effective by certain dates set forth in the RRA, the Company will be required to pay Helena I certain amounts as liquidated damages.
22
|
10.
|
Convertible debentures (continued)
|
A continuity of the Company’s convertible debentures is as follows:
|
Balance as at July 31, 2024
|
$
|
|
||
|
Issued
|
|
|||
|
Fair value of embedded derivative
|
(
|
)
|
||
| Issuance discount | ( |
) | ||
| Transaction costs | ( |
) | ||
| Repayment | ( |
) | ||
|
Accretion
|
|
|||
|
Interest
|
|
|||
| Accrued interest transferred to accrued liabilities |
( |
) | ||
| Extinguishment |
( |
) | ||
| Assumed on RTO |
||||
|
Balance as at July 31, 2025
|
$
|
|
||
| Repayment | ( |
) | ||
| Accretion | ||||
| Interest | ||||
| Balance as at October 31, 2025 | $ |
Breakdown of the Company’s
convertible debentures is as follows:
|
October 31, 2025
|
July 31, 2025
|
|||||||
|
Convertible debentures, short-term, related party
|
$
|
|
$
|
|
||||
|
Convertible debentures, long-term, related party
|
|
|
||||||
|
Convertible debentures, long-term
|
|
|
||||||
|
$
|
|
$
|
|
|||||
The face value of the convertible debentures as of October 31, 2025 was $13,756,590 .
Below is a continuity of the embedded derivative liabilities:
|
Balance as at July 31, 2024
|
$
|
|
||
|
Derivative liability component
|
|
|||
|
Change in fair value of derivative liabilities
|
(
|
)
|
||
|
Transferred to equity
|
( |
) | ||
|
Balance as at July 31, 2025
|
$
|
|
||
| Change in fair value of derivative liabilities |
||||
| Balance as at October 31, 2025 |
$ |
In connection with the issuance of the convertible debentures during the year ended July 31, 2025, the Company incurred $85,000 in directly attributable transaction costs, which are allocated to the convertible debenture.
In connection with the issuance of the convertible debentures during the year ended July 31, 2024, the Company incurred $40,227 in directly attributable transaction costs. $36,484
was allocated to the host financial liability, $3,743 was allocated to the embedded derivative and recorded immediately in the
consolidated statement of operations as general and administrative expenses.
23
|
10.
|
Convertible debentures (continued)
|
The key inputs used in the Monte Carlo model for the derivative liabilities were as follows:
|
At initial
measurement
(for the year
ended July 31,
2025)
|
As at
July 31, 2025
|
As at
October 31, 2025
|
||||||||||
|
Probability of De-SPAC Transaction closing
|
|
%
|
N/A |
N/A
|
||||||||
|
Risk-free interest rate
|
|
%
|
|
%
|
% | |||||||
|
Expected term (years)
|
|
|
||||||||||
|
Expected annual volatility for the Company
|
|
%
|
|
%
|
% | |||||||
|
Expected annual volatility for Focus Impact
|
|
%
|
N/A
|
N/A
|
||||||||
|
Common conversion ratio
|
|
N/A |
N/A
|
|||||||||
|
Foreign exchange rate
|
|
N/A |
N/A
|
|||||||||
As at October 31, 2025, the conversion options attached to the Devvio Tranche, the Focus Impact Partners Convertible Debt, the Envviron Tranche, and the New Convertible
Debt meet the definition of equity under Topic 815, and are accordingly no longer presented as derivative liabilities. Only the conversion option attached to the Additional Convertible Debt is presented as derivative liabilities.
24
|
11.
|
Warrant liabilities
|
Impact of Change in Functional Currency on August 1, 2024
As at July 31, 2024, the Company had 132,811
warrants outstanding. The exercise price of these warrants is denominated in CAD. Due to the change in functional currency of the Company, a total of 121,995
warrants which were issued in connection with the Company’s reverse merger on November 4, 2022 and for private placements with an initial carrying value of $1,836,666 were reassessed to be derivative liabilities. The fair value of the warrants upon the change in classification on August 1, 2024 of $454,571 , was remeasured using the Black-Scholes option pricing model, with the following assumptions (weighted average): expected dividend yield - 0 %, expected volatility - 105 %,
risk-free interest rate – 3.49 % and an expected remaining life – 0.7 years. The fair value of these warrants is classified as Level 2 in the fair value hierarchy. The difference between the previous carrying value which was initially
recorded as equity and the fair value of the warrant liabilities on August 1, 2024 was $1,382,096 . Pursuant to ASC 815-40-35-9, the
difference is recognized within equity.
Changes to warrant liability during the three months ended October 31, 2025
As at October 31, 2025, the fair value of the liability classified warrants were
remeasured at $3,343,175 using the Black-Scholes option pricing model, with the following assumptions (weighted average):
expected dividend yield - 0 %, expected volatility - 150 %, risk-free interest rate – 2.70 % and an expected remaining life of 4.02 years. The Company recognized ($2,283,298 )
as a change in fair value for the three months ended October 31, 2025.
The following is a continuity of the Company’s derivative warrant liabilities:
|
Balance as at July 31, 2024
|
$
|
|
||
|
Warrants fair value upon change in functional currency (Note 2)
|
|
|||
|
Warrants issued upon De-SPAC transaction (Note 4)
|
|
|||
|
Warrants to be issued (mandatory convertible debentures)
|
|
|||
|
Change in fair value of warrant liabilities (exercised warrants)
|
|
|||
|
Change in fair value of warrant liabilities (expired warrants)
|
(
|
)
|
||
|
Fair value of warrants exercised
|
(
|
)
|
||
|
Change in fair value of warrant liabilities
|
(
|
)
|
||
|
Balance as at July 31, 2025
|
$
|
|
||
| Change in fair value of warrant liabilities | ( |
) | ||
| Balance as at October 31, 2025 | $ |
| 12. |
Stock option liabilities
|
Impact of listing on the NASDAQ on November 6, 2024
As at November 6, 2024, the Company had 62,772
stock options outstanding. The exercise price of these stock options is denominated in CAD. Due to the listing of the Company on the NASDAQ (Note 4) and commencement of trading of shares in the United States dollars, exemptions available under ASC
718-10-25-14 to classify stock options with strike prices in foreign currencies as equity were no longer met and all stock options outstanding were reassessed to be derivative liabilities. The fair value of the stock options upon the change in
classification on November 6, 2024 of $330,090 , was remeasured using the Black-Scholes option pricing model, with the following assumptions
(weighted average): expected dividend yield - 0 %, expected volatility - 97 %, risk-free interest rate – 3.12 % and an expected remaining life – 5.96 years. The fair value of these options is classified as Level 2 in the fair value hierarchy. The difference between the previous carrying value which
was initially recorded as equity and the fair value of the option liabilities on August 1, 2024 was $1,381,715 . Pursuant to ASC
815-40-35-9, the difference is recognized within equity.
25
| 12. |
Stock option liabilities (continued)
|
Changes to stock option liability during the three months ended October 31, 2025
As at October 31, 2025, the fair value of the liability classified stock options were remeasured at $61,506 using Black-Scholes option pricing model, with the following assumptions (weighted average): expected dividend yield - 0 %, expected volatility - 150 %, risk-free interest rate – 2.81 % and an expected remaining life of 4.66
years. The Company recognized ($71,959 ) as a change in fair value for the three months ended October 31, 2025, which is presented within
salaries and wages.
The following is a continuity of the Company’s derivative stock option liabilities:
|
Balance as at July 31, 2024
|
$
|
|
||
|
Stock options fair value upon change De-SPAC transaction (Note 4)
|
|
|||
|
Change in fair value of stock option liabilities
|
(
|
)
|
||
|
Balance as at July 31, 2025
|
$
|
|
||
| Change in fair value of stock option liabilities | ( |
) | ||
| Balance as at October 31, 2025 | $ |
| 13. |
Share capital
|
| (a) |
Authorized
|
The Company is authorized to issue an
number of common stock without par value.
The Company is authorized to issue an number of preferred stock, issuable in series in accordance with the Business Corporations Act of Alberta, Canada.
| (b) |
Shares issued
|
Shares issued during the three months ended October 31, 2025
In August 2025, the Company issued 300,000 shares in accordance with the
ELOC Agreement with Helena I (Note 8) for gross proceeds of $756,600 .
Shares issued during the three months ended October 31, 2024
On September 5, 2024, the Company issued 1,596 shares
with a fair value of $47,904 in settlement of accounts payable in the amount of $39,527 and recognized a loss on the settlement of $8,377 .
In October 28, 2024, the Company issued 2,244 shares
with a fair value of $49,500 for the conversion of the mandatory convertible debentures.
On October 29, 2024, the Company issued 9,176 shares
for the exercise of 9,176 share purchase warrants, at an exercise price of CAD$13.08 per share for gross proceeds of $86,237 . The fair value
of the warrants was $303,492 .
26
|
(c)
|
Share purchase warrants
|
The continuity of share purchase warrants is as follows:
|
Number of
warrants
|
Weighted
Average Exercise
price
|
Remaining
life (Years)
|
||||||||||
|
Balance, July 31, 2024
|
|
$
|
|
|
||||||||
|
Issued on RTO (Note 4)
|
$ |
-
|
||||||||||
|
Exercised
|
(
|
)
|
$
|
|
-
|
|||||||
|
Expired
|
( |
) | $ | - | ||||||||
|
Balance, July 31, 2025
|
|
$
|
|
|
||||||||
| Balance, October 31, 2025 |
$ | |||||||||||
As at October 31, 2025, the following share purchase warrants were outstanding:
|
Number of warrants outstanding
|
Exercise price
|
Expiry date
|
|||
|
|
CAD$
|
|
|||
|
|
$
|
|
|||
|
|
*Each warrant exercisable for 0.09692
common stock .
All of the warrants outstanding are liability classified (Note 11).
The Company has 1,122 warrants with
an exercise price of CAD$67.30 to be issued as of October 31, 2025.
Of the 22,699,987 warrants issued on the RTO, 11,200,000 were to replace former SPAC public
warrants (“Public Warrants”), and 11,499,987 were to replace former SPAC private warrants (“Private Warrants”, together with
Public Warrants, “SPAC Warrants”). Each SPAC Warrant is exercisable at $1.52 for 0.09692 shares of common stock.
In connection with the Initial Business Combination, the Company assumed the agreements for the SPAC Warrants between the Company’s predecessor, Focus Impact Acquisition
Corp., and Continental Stock Transfer & Trust Company, as warrant agent, and entered into such amendments thereto as were necessary to give effect to the provisions of the BCA, and each SPAC Warrant then outstanding and unexercised
automatically without any action on the part of its holder was converted into a warrant of the Company.
Each
replacement warrant is subject to the same terms and conditions, including exercisability terms, as were applicable to the corresponding SPAC Warrants immediately prior to the Initial Business Combination, except to the extent of such
terms or conditions that are rendered inoperative by the Initial Business Combination. Accordingly, following the Initial Business Combination:
| • |
each replacement warrant will be
exercisable solely for the Company’s common shares;
|
| • |
the number of the Company’s common shares
subject to each replacement warrant will be equal to the number of Class A common shares subject to the applicable SPAC Warrant (subject to amendments as set forth in the agreement to the SPAC Warrants)
|
| • |
the per share exercise price for the
Company’s common shares issuable upon exercise of such replacement warrant will be equal to the per share exercise price for the Class A Common Shares subject to the applicable SPAC Warrant, as in effective prior to the Initial
Business Combination (subject to amendments as set forth in the agreement to the SPAC Warrants)
|
27
| 13. |
Share capital (continued)
|
|
(c)
|
Share purchase warrants (continued)
|
Public Warrants
The Company had agreed that as soon as practicable, but in no event later than business days after the closing of the Initial Business Combination, the Company would use commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the shares of common stock issuable upon exercise of the warrants, and the Company would use commercially reasonable efforts to cause the same to become effective within
If a registration statement covering the shares of common stock issuable upon exercise of the warrants is not effective by the
Private Warrants
The Private Warrants are not redeemable by the Company so long as they are held by
Focus Impact Sponsor or its permitted transferees. Focus Impact Sponsor or its permitted transferees have the option to exercise the Private Warrants on a cashless basis
Company’s right to redemption of warrants
The Company may redeem the outstanding Public Warrants under the following conditions, while a registration statement covering the common stock issuable upon exercise of the warrants is effective, upon a minimum of30
Company’s right to redemption of warrants
The Company may redeem the outstanding Public Warrants under the following conditions, while a registration statement covering the common stock issuable upon exercise of the warrants is effective, upon a minimum of
|
|
(1)
|
Redemption at a price of $
|
If common stock is trading at a price in excess of $
28
| 13. |
Share capital (continued)
|
|
(c)
|
Share purchase warrants (continued)
|
|
|
(2)
|
Redemption at a price of $
|
| If the common stock is trading in excess of $ |
||
| Concurrently, if the common stock is trading at a price of less
than the Upper Redemption Trigger for any |
Adjustments to exercise price of SPAC Warrants
The terms of the SPAC Warrants provided for an
adjustment of the exercise price if the Initial Business Combination issued shares at a price (“Newly Issued Price”) below $92.00
per share, the aggregate gross proceeds from such issuances represent more than 60 % of total equity proceeds, and the 20-day VWAP of the Company’s shares upon Initial Business Combination (“Market Value”) is below $92.00 .
In such event, the exercise price will be
adjusted to be 115 % of the higher of the Market Value and the Newly Issued Price (“Reference Price”); the Upper Redemption
Trigger will be adjusted to be 180 % of the Reference Price ; and the Lower Redemption Trigger will be adjusted to the
Reference Price.
On December 6, 2024, the Company determined the
Newly Issued Price was $13.20 ; and the Market Value was $9.40 . Accordingly the Reference Price was set at $13.20 . The
Company accordingly issued a notice of warrant adjustment to holders of SPAC Warrants, effecting the following adjustments in accordance with the terms of the SPAC Warrants:
| • |
Adjustment to the exercise price of the SPAC Warrants to $
|
| • |
Adjustment of the Upper Redemption Trigger to $
|
| • |
Adjustment of the Lower Redemption Trigger to $
|
The number of SPAC Warrants outstanding is not
impacted by the consolidation arising from the RTO (Note 4) nor the reverse stock split of the Company. Correspondingly, the exercise price is also not adjusted. Instead, the number of shares each SPAC Warrant is exercisable into is
adjusted to account for such adjustments. Upon RTO, the number of shares each SPAC Warrant is exercisable into (“Exercise Ratio”) is reduced from 1 to 0.9692 . Upon reverse stock-split in August 2025, the Exercise
Ratio is further reduced to 0.09692 .
As set forth
in the warrant agreement for the SPAC Warrants, the SPAC Warrants are not exercisable for any fractional shares. If, by reason of any adjustment made pursuant to the terms of the SPAC Warrants, the holder would be entitled to a
fractional interest in a shares upon exercise of such SPAC Warrant, the Company shall round down to the nearest whole number of common shares to be issued to such holder upon exercise.
29
| 13. |
Share capital (continued)
|
|
(d)
|
Stock options
|
The continuity of the Company’s stock options is as follows:
|
Number of
stock options
|
Weighted average
exercise price
|
|||||||
|
Outstanding, October 31, 2024 and July 31, 2024
|
|
$
|
|
|||||
|
Forfeited
|
(
|
)
|
$
|
|
||||
|
Granted
|
|
$
|
|
|||||
|
Cancelled
|
(
|
)
|
$
|
|
||||
|
Outstanding, July 31, 2025
|
|
$
|
|
|||||
|
Outstanding, October 31, 2025
|
|
$
|
|
|||||
|
Exercisable, July 31, 2025
|
|
$
|
|
|||||
|
Exercisable, October 31, 2025
|
|
$
|
|
|||||
As at October 31, 2025, the weighted average remaining contractual life of outstanding options is 4.66 years (July 31, 2025 – 4.90 years).
As at October 31, 2025, the following stock options were outstanding and exercisable:
|
Number of options
outstanding
|
Exercise
price
|
Expiry date
|
Number of
options
exercisable
|
||||
|
|
CAD$
|
|
|
||||
|
|
CAD$
|
|
|
||||
|
|
CAD$
|
|
|
||||
|
|
CAD$
|
|
|
||||
|
|
$
|
|
|
||||
|
|
CAD$
|
|
|
||||
|
|
CAD$
|
|
|
||||
|
|
CAD$
|
|
|
||||
|
|
CAD$
|
|
|
||||
| CAD$ |
|||||||
|
|
|
Stock options
issued during the three months ended October 31, 2025
Stock options issued during the three months ended
October 31, 2024
30
|
13.
|
Share capital (continued)
|
|
(d)
|
Stock options (continued)
|
Share-based compensation – Stock options
Share-based
payments relating to the vesting of stock options for the three months ended October 31, 2025 was $18,437 (2024 - $80,893 ) and is recorded as salaries and wages on the consolidated statement of operations.
As of November 6,
2024, upon the listing of the Company’s shares on the NASDAQ, 58,644 stock options outstanding are liability classified (Note 12).
As of October 31,
2025, the total intrinsic value of stock options outstanding and exercisable was $ and $, respectively. The intrinsic value of outstanding stock options is based on the Company’s closing stock price on October 31, 2025.
|
(e)
|
Restricted stock units (“RSUs”) |
The continuity of the Company’s RSU’s is as follows:
|
Number of RSUs
|
||||
| Outstanding, July 31, 2024 |
||||
| Granted |
||||
| Forfeited |
( |
) | ||
|
Outstanding, July 31, 2025 and October 31, 2025
|
|
|||
As at October 31, 2025, the following RSUs were outstanding and vested:
|
Number of RSUs
outstanding
|
Grant date
|
Number of RSUs
Vested
|
||||||
|
|
November 30, 2021
|
|
||||||
|
|
December 24, 2021
|
|
||||||
|
|
March 1, 2022
|
|
||||||
|
|
March 14, 2022
|
|
||||||
|
|
July 30, 2024
|
|
||||||
|
March 26, 2025
|
||||||||
|
|
|
|||||||
Share-based compensation – RSU’s
Share-based payments relating to the vesting of RSUs for the three months ended October 31, 2025 was $41,895 (2024 - $126,343 ) and is recorded as salaries and wages
on the consolidated statement of operations.
31
| 14. |
Related party transactions and balances
|
Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the
other party in making financial and operating decisions. Related parties may be individuals or corporate entities. A transaction is a related party transaction when there is a transfer of resources or obligations between related parties.
At October 31, 2025, the Company had amounts owing and accrued liabilities of $226,410 (July 31, 2025 - $794,990 ) payable to directors and officers of the
Company for salaries, expense reimbursements and professional fees. These amounts are non-interest bearing and have no terms of repayment.
During the three months ended October 31, 2025, the Company incurred wages and management fees of $113,750 and $120,000 , respectively, to officers of the Company. Share based
compensation incurred to officers and directors of the Company amounted to $33,409 .
During the three months ended October 31, 2025, the Company accrued interest of $62,622 on convertible debentures payable to related parties (Note 10).
|
15.
|
Financial instruments
|
As at October 31, 2025, the Company’s financial instruments consist of cash, restricted cash, trade receivable, GST receivable, corporate taxes receivable, deposit
on carbon credits purchase, accounts payable and accrued liabilities, convertible debentures, warrant liabilities, stock option liabilities, stop loss provision liabilities and derivative liabilities. The Company classifies cash, GST receivable,
corporate taxes receivable, and deposit on carbon credits purchase as financial assets held at amortized cost. The Company classifies accounts payable and accrued liabilities as financial liabilities which are held at amortized cost. The
Company’s warrant liabilities, stock option liabilities, and stop loss provision liabilities are carried at FVTPL. The Company’s convertible debentures are hybrid instruments where the debt host component is held at amortized cost and the
embedded derivative was measured at FVTPL, until upon their amendments (Note 10), or the completion of the De-SPAC transaction (Note 4) of the Company, when they met the criteria for equity classification and were transferred to equity.
The Company’s derivative liabilities are level 3 financial instruments and its warrant liabilities and stock option liabilities are Level 2 instruments. In
determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. Observable or market inputs reflect market data
obtained from independent sources, while unobservable inputs reflect the Company’s assumptions based on the best information available. The unobservable inputs used for valuation of the mandatory convertible debentures and derivative liabilities
included volatility and probability of De-SPAC transaction. Any significant changes in unobservable inputs could result in significantly lower or higher fair value measurements.
32
|
15.
|
Financial instruments (Continued)
|
The risk exposure arising from these financial instruments is summarized as follows:
|
(a)
|
Credit risk
|
The Company’s financial assets are cash, restricted cash, trade receivable, GST receivable, corporate taxes receivable, and deposit on carbon credits purchase. The
Company’s maximum exposure to credit risk, as at period end, is the carrying value of its financial assets, being $2,850,867 . The
Company holds its cash with a major financial institution and with a publicly traded payment processing company therefore minimizing the Company’s credit risk.
|
(b)
|
Liquidity risk
|
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company manages liquidity by maintaining
adequate cash balances and by raising equity financings. The Company has no assurance that such financings will be available on favorable terms. In general, the Company attempts to avoid exposure to liquidity risk by obtaining corporate financing
through the issuance of shares.
As at October 31, 2025, the Company had cash of $819,076
to settle the contractual obligation of current liabilities of $10,732,028 which fall due for payment within twelve months of the
statement of financial position. All of the Company’s contractual obligations are current and due within one year .
|
(c)
|
Market risk
|
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company’s income or value of
its holdings or financial instruments. At October 31, 2025, the Company has minimal exposure to these risks.
| 16. |
Segmented information
|
The Company operates in one no
reportable segment revenues. The Company’s assets are located in Canada.
| 17. |
Commitments and contingencies
|
| • |
On September 12, 2023, the Company amended its existing strategic partnership agreement with Devvio, a related party. The Company has committed to making specific payments to Devvio. They will
provide a minimum advance of $
|
| • |
On February 16, 2024, the Company entered into a licensing agreement with Greenlines Technology Inc. for the use of certain technologies. The Company has agreed to pay $
|
33
| 17. |
Commitments and contingencies (Continued)
|
| • |
On November 13, 2024, the Company entered into a strategic consulting agreement with Focus Impact Partners, pursuant to which the Focus Impact Partners
will provide the Company with certain consulting services (“Strategic Consulting Agreement”) in consideration of an annual consulting fee of $
|
| • |
Holders of the Company’s common stock, including Focus Impact Sponsor and historical holders of Devv Holdings, as well as holders of SPAC Warrants are entitled to registration rights pursuant to registration rights
agreements signed prior to the RTO, requiring the Company to register such securities for resale. The holders of the majority of these securities are entitled to make up to
|
| • |
On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other measures, a new U.S. federal 1% excise tax on certain repurchases,
including redemptions, of stock by publicly traded domestic corporations in the U.S. The excise tax is imposed on the repurchasing corporation and the amount of the excise tax is generally 1% of the fair market value of the stock
repurchased. However, for the purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the
same taxable year. In addition, certain exceptions apply to the excise tax. During 2024, the IRS issued final regulations with respect to the timing and payment of excise tax. Pursuant to those regulations, the Company would need to
file a return and remit payment for any liability incurred during the period from January 1, 2023 to December 31, 2023 on or before October 31, 2024. The Company is currently evaluating its obligations with respect to this provision
of the IR Act. As the Company was formerly a special purposes acquisition corporation, redemption of shares by shareholders took place prior to the Initial Business Combination. The Company accrued $
|
| • |
On October 28, 2025, in accordance with an amendment to the strategic partnership agreement with Devvio, a related party, the Company agreed to purchase DevvE tokens annually in the amount of $
|
34
| 17. |
Commitments and contingencies (Continued)
|
|
•
|
From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. At
October 31, 2025, there were
|
| 18. |
Subsequent events
|
Agreement and Plan of Merger with Southern Energy Renewables Inc.
On December 3, 2025, the Company entered into an Agreement and Plan
of Merger with Southern Energy Renewables Inc. (“Southern”) and Sierra Merger Sub, Inc., a Delaware corporation and a newly-formed wholly owned subsidiary of the Company. The transaction contemplates (i) a domestication of the Company
into a Delaware corporation, (ii) a merger in which Southern will become a wholly owned subsidiary of the Company, and (iii) the issuance of Company common shares to Southern’s existing shareholders such that, upon completion of the
merger, the Southern shareholders (inclusive of the concurrent PIPE described below) will hold approximately 70 % of the
Company’s common shares on a fully diluted basis, resulting in a reverse takeover of the Company by Southern.
Concurrent with signing the Merger Agreement, a Southern investor
completed a private placement investment of approximately $2,000,000 for 128,370 common shares of the Company at a price of $15.58
per share. The Company also agreed to register the resale of the PIPE shares and the shares issuable to Southern shareholders following the closing of the merger.
Side Letter with Helena I
On the same date, the Company entered into a side letter with Helena
I amending the terms of the Company’s existing convertible note and equity line of credit arrangements (Note 8). The amendments include, among other items, limitations on Helena’s sales of conversion shares, subject to trading-volume
conditions, and a requirement that the Company draw a minimum of $7,500,000 in aggregate proceeds under the equity line of
credit prior to February 28, 2026. These limitations may cease to apply if the Company defaults under the convertible note or is unable to submit compliant advance notices under the equity line of credit for more than trading days.
Issuance of shares
In December 2025, the Company issued 411,000 shares in accordance with the ELOC Agreement with Helena I (Note 8) for gross proceeds of $821,229 . $205,307 of the gross proceeds are used to repay the Crypto Strategy Convertible Debt (Note 10).
These transactions occurred after the balance sheet date and do not relate to conditions
existing as of October 31, 2025. Accordingly, no adjustments have been made to the accompanying financial statements.
FORWARD LOOKING STATEMENTS AND CERTAIN CONSIDERATIONS
This report, along with other documents that are publicly disseminated by us, contains or might contain forward-looking statements within the meaning of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”). All statements included in this report and in any subsequent filings made by us with the Securities and Exchange Commission (the “SEC”) other than statements of historical fact, that address activities,
events or developments that we or our management expect, believe or anticipate will or may occur in the future are forward-looking statements. These statements represent our reasonable judgment on the future based on various factors and
using numerous assumptions and are subject to known and unknown risks, uncertainties and other factors that could cause our actual results and financial position to differ materially. We claim the protection of the safe harbor for
forward-looking statements provided in the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Exchange Act. Examples of forward-looking
statements include: (i) projections of revenue, earnings, capital structure and other financial items, (ii) statements of our plans and objectives, (iii) statements of expected future economic performance, and (iv) assumptions underlying
statements regarding us or our business. Forward-looking statements can be identified by, among other things, the use of forward-looking language, such as “believes,” “expects,” “estimates,” “may,” “will,” “should,” “could,” “seeks,”
“plans,” “intends,” “anticipates” “outlook,” “continues,” “approximately,” “predicts,” “estimates,” “projects,” or “scheduled to” or the negatives of those terms, or other variations of those terms or comparable language, or by
discussions of strategy or other intentions.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from those contemplated by the
statements. The forward-looking information is based on various factors and was derived using numerous assumptions. Important factors that could cause our actual results to be materially different from the forward-looking statements
include the following risks and other factors discussed under Item 1A “Risk Factors” in this report and under Item 1A “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on November 6, 2025. These factors include:
| • |
the Company’s ability to recognize the expected benefits of the Business Combination;
|
| • |
the number of stockholders that exercise dissenter’s rights in connection with the Merger;
|
| • |
the occurrence of any event, change or other circumstances that could give rise to the termination of negotiations and any subsequent definitive
agreements with respect to the proposed merger transactions;
|
| • |
the outcome of any legal proceedings that may be instituted against the Company, Southern, the combined company or others;
|
| • |
the inability of the parties to successfully or timely consummate the Merger, including the risk that any required regulatory approvals are not
obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined company or the expected benefits of the Merger or that the approval of stockholders is not obtained;
|
| • |
changes to the proposed structure of the proposed merger transactions that may be required or appropriate as a result of applicable laws or regulations;
|
| • |
the ability to meet stock exchange listing standards following the consummation of the proposed merger transactions;
|
| • |
the risk that the proposed merger transactions disrupts current plans and operations of the Company or Southern as a result of the announcement and
consummation of the proposed transactions;
|
| • |
the ability to recognize the anticipated benefits of the proposed merger transactions, which may be affected by, among other things, competition, the
ability of the combined company to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees;
|
| • | costs related to the proposed merger transactions; |
| • |
the Company’s Digital Asset Strategy and assets;
|
| • |
the Company’s ability to utilize its ELOC Agreement and to sell additional Convertible Notes to Helena (as such terms are defined below);
|
| • |
changes in the market price of Common Shares and the digital assets the Company owns;
|
| • |
the ability of the Company to maintain the listing of the Common Shares on Nasdaq;
|
| • |
future financial performance;
|
| • |
the impact from the outcome of any known and unknown litigation;
|
| • |
the ability of the Company to forecast and maintain an adequate rate of revenue growth and appropriately plan its expenses;
|
| • |
expectations regarding future expenditures of the Company;
|
| • |
the future mix of revenue and effect on gross margins of the Company;
|
| • |
changes in interest rates, rates of inflation, carbon credit prices and trends in the markets in which we operate;
|
| • |
the attraction and retention of qualified directors, officers, employees and key personnel;
|
| • |
the ability of the Company to compete effectively in a competitive industry
|
| • |
the ability to protect and enhance the Company’s corporate reputation and brand;
|
| • |
future development activities, including, but not limited to, acquiring interests in carbon reduction projects and carbon credits and the development of software and technological applications to
carbon credit projects and carbon credits;
|
| • |
expectations concerning the relationships and actions of the Company and its affiliates with third parties;
|
| • |
the impact from future regulatory, judicial and legislative changes in the Company’s industry;
|
| • |
the ability to locate and acquire complementary products or product candidates and integrate those into the Company’s business;
|
| • |
future arrangements with, or investments in, other entities or associations;
|
| • |
competitive pressures from other companies in the industries in which the Company operates;
|
| • |
the growth and value of the global carbon credit or I-REC market traded value;
|
| • |
the impact of regulatory uncertainty and changes related to digital assets, including potential classification of digital assets as securities;
|
| • |
risks relating to the custody of our tokens, including the loss or destruction of private keys required to access our tokens and cyberattacks or other data loss relating thereto, including smart
contract related losses and vulnerabilities; and
|
| • |
the volatility of the market price and liquidity or trading of the securities of the Company.
|
While forward-looking statements reflect the Company’s good faith beliefs, they are not guarantees of future performance. The Company disclaims any
obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this proxy statement, except
as required by applicable law. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to the Company.
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF DEVVSTREAM
Cautionary Note Regarding Forward-Looking Statements
The following discussion and analysis should be read in conjunction with DevvStream’s unaudited condensed consolidated interim financial statements and related notes for
the three months ended October 31, 2025 and 2024 (“interim financial statements”), which have been prepared in accordance with US GAAP and are included elsewhere in this report. This discussion contains forward-looking statements reflecting
our current expectations, estimates and assumptions concerning events and financial trends that may affect our future operating results or financial position. Actual results and the timing of events may differ materially from those
contained in these forward-looking statements due to a number of factors, including those described in our other SEC filings, including those discussed in the sections titled “Risk Factors” and “Cautionary Note Regarding Forward-Looking
Statements” in our Annual Report on Form 10-K filed with the SEC on November 6, 2025. All figures are in US dollars unless otherwise noted. Unless the context otherwise requires, for the purposes of this section, “DevvStream,” “we,” “us,”
“our,” or the “Company” refer to DevvStream Corp. , a company existing under the Laws of the Province of Alberta, Canada, and its subsidiaries.
Company Overview
DevvStream is a technology-based sustainability company that advances the development and monetization of environmental assets, with an initial focus on carbon markets. The Company's
mission is to create alignment between sustainability and profitability, helping organizations achieve their climate initiatives while directly improving their financial health.
With a diverse approach to the International Renewable Energy Certificate (“I-REC”) and carbon market, DevvStream operates across three strategic domains: (1) an offset portfolio consisting
of I-REC’s, nature-based, tech-based, and carbon sequestration credits for immediate sale to corporations and governments seeking to offset their most difficult-to-reduce emissions; (2) project investment, acquisitions, and industry
consolidation to extend the Company's reach, allowing it to become a full end-to-end solutions provider; and (3) project development, where the Company serves as project manager for eligible activities such as EV charging in exchange for a
percentage of generated credits.
Company Formation and Reverse Takeover Transaction
We are a company existing under the Business Corporations Act of Alberta, Canada. We were a special purpose acquisition corporation (“SPAC”) incorporated in Delaware, the United States on
February 23, 2021.
On September 12, 2023 (and as amended May 1, 2024, August 10, 2024, and October 29, 2024, the “Business Combination Agreement”, or “BCA”), we entered into a Business
Combination Agreement with DevvStream Holdings Inc. (the ‘‘Business Combination’’ or the ‘‘De-SPAC Transaction’’). The Business Combination was structured as an amalgamation of DevvStream
Holdings Inc. (“Devv Holdings”) into a wholly owned subsidiary of the Company, following our redomiciling as an Alberta company. We were then renamed from Focus Impact Acquisition Corp. to DevvStream Corp. and continue the business of
Devv Holdings following the amalgamation. It was a condition of the transaction that the securities of the Combined Company will be listed on NASDAQ.
On November 6, 2024, we completed the business combination with Devv Holdings, pursuant to the BCA. In connection with the completion of the business combination, we consolidated all of our
issued and outstanding common stock on a 1:0.9692 basis. All the outstanding Devv Holdings subordinate voting shares (“SVS”) were exchanged for common stock of the Company on a common conversion ratio of 0.152934 (the “Common Conversion
Ratio”). All the outstanding Devv Holdings multiple voting shares (“MVS”), being the equivalent of 10 SVS, were exchanged for common stock of the Company on the basis of the Common Conversion Ratio. In addition, all of the outstanding
convertible securities of Devv Holdings were exchanged for securities of the Company on the basis of the Common Conversion Ratio, with corresponding adjustments to exercise prices, and otherwise on substantially the same economic terms and
conditions. Our common shares commenced trading on the NASDAQ under the new ticker symbol “DEVS” on November 7, 2024.
Devv Holdings is deemed as the acquirer for accounting purposes, and therefore its assets, liabilities and operations are included in the consolidated financial statements at their historical
carrying value. Our operations are considered to be a continuance of the business and operations of Devv Holdings. Our results of operations are those of Devv Holdings, with our operations being included from November 6, 2024, the closing
date of the De-SPAC Transaction, onwards.
Recent Developments
Change in Functional Currency
Effective August 1, 2024, the Company reassessed its functional currency and the functional currency of its subsidiaries due to changes in underlying transactions, events, and conditions. As a
result of this reassessment, the Company determined that its functional currency changed from the Canadian dollar (“CAD$”) to the United States dollar (“US$”) for DevvStream Holdings Inc. and its subsidiary, Devvstream Inc. (“DESG”). The
functional currency for DevvESG Streaming Finco Ltd. (“Finco”), another subsidiary of ours, remained CAD$. This change aligns with the business’s future focus and the effective date of the Focus Impact Acquisition Corp.’s Form S-4
Registration Statement with the SEC, a crucial part of the De-SPAC transaction closing. The change in functional currency was accounted for prospectively from August 1, 2024, with no impact on prior year comparative information. Upon the
change in functional currency on August 1, 2024, 121,995 of the Company’s warrants which had strike prices denominated in CAD$ were reclassified as warrant liabilities. Determining the functional currency involved significant judgments to
assess the primary economic environment in which the Company operates, including factors such as the currency of underlying transactions, the location of key operations, and the currency of expected cash flows. Upon the completion of the
De-SPAC Transaction on November 6, 2024, 62,772 of the Company’s stock options which had strike prices denominated in CAD$ were reclassified as stock option liabilities, as exemptions from classification from derivative liability
classification under ASC 718-10-25-14 that were previously applicable upon change in functional currency no longer apply upon the commencement of trading of the Company’s common shares on the NASDAQ.
Cryptocurrency Treasury Strategy
On July 17, 2025, the Company entered into a securities purchase agreement with Helena for the issuance of up to fifty-nine tranches of convertible notes (“Crypto Strategy Convertible Debt”) for
a total principal amount of $300,000,000, with closings of each tranche subject to fulfillment of conditions. Each tranche will have an issuance discount of 8%, and bear interest at a rate of 8% per annum, with a maturity date of 18 months
from the date of funding. Interest shall be payable by the Company on the first day of each month. The securities purchase agreement will terminate automatically on July 17, 2027.
The principal loan amount and any accrued interest under the Crypto Strategy Convertible Debt in issuance are convertible into common stock of the Company at the option of the holder at 95% of
the lowest daily volume weighted average price of the Company’s shares during the 5 preceding trading days, subject to a floor price of $0.7722, and a cap price of $7.722. If the Company issues any debt or equity, the lenders have the
option to cause the Company to direct 25% of aggregate proceeds of such issuances to repay the Crypto Strategy Convertible Debt. The Company has a right to prepay the whole or any portion of the principal amount, together with any accrued
interest, at any time prior to the maturity date without notice or a penalty payment.
During the period ending on the later of (i) 12 months after the closing date of the initial tranche of the Crypto Strategy Convertible Debt, and (ii) the termination of the securities purchase
agreement for the Crypto Strategy Convertible Debt, if the Company offers new securities for sale, the lenders have first refusal to up to 25% of the new securities being offered.
The proceeds of the Crypto Strategy Convertible Debt are subject to restrictions of use, with 70% of the net proceeds of the initial tranche, and 75% of the net proceeds of the subsequent
tranches are required to be used to purchase cryptocurrencies. The Crypto Strategy Convertible Debt is secured by up to $20,000,000 of proceeds from the Crypto Strategy Convertible Debt, held in a segregated account for trading in
cryptocurrencies. The segregated account is subject to a crypto control account agreement, which requires lenders’ approval for actions taken in the segregated account.
On July 17, 2025, the Company closed the initial tranche of the Crypto Strategy Convertible Debt in the principal amount of $10,000,000, for gross proceeds of $9,200,000, with a maturity date of
January 17, 2027. The Company also incurred $85,000 in transaction costs in connection with the issuance. $6,405,000 of net proceeds are intended for the purchase of cryptocurrencies. As of October 31, 2025, $1,280,000 are held as cash in a
segregated account, and are thus presented as restricted cash in the consolidated balance sheet.
On August 1, 2025, the Company started deploying funds raised from its senior secured convertible notes facility with
Helena for purchases of Bitcoin and Solana, as part of the operational launch of the Company’s digital treasury strategy, supporting the Company’s long-term objectives in and the industry’s move towards sustainability-linked tokenization.
As provided under the terms of the Helena Note Purchase Agreement, at the closing of the Initial Convertible Note the Company allocated the requisite 70% of the proceeds of the Initial Convertible Note for the acquisition of the First
Tranche Assets, taking into account an issuance discount of $850,000.00 to cover Helena’s legal, accounting, and due diligence fees, along with any other transactional costs incurred in connection with the issuance of the Initial
Convertible Note. This provided for an initial cash funding transfer on July 18, 2025 of $6,405,000 to the Company’s custodial account with BitGo for ultimate deployment into the First Tranche Assets.
As of the date of this Quarterly Report, the Company has not yet made any acquisitions of DevvE. The Company’s current
intention is to begin allocating the approximate 20% remaining from the designated proceeds of the Initial Convertible Note toward the purchases of DevvE in the first half of 2026. After completing the full deployment of the proceeds from
the Initial Tranche, 80% of such proceeds are to be deployed equally into BTC and SOL, with the remaining 20% allocated into DevvE. As of October 31, 2025, the Company has purchased a total of 22.228945 BTC and 12,110.98 SOL. As of
October 31, 2025, the Company has staked 12,274.96690584 SOL.
The Company has no specific timeline for the issuance of subsequent tranches of Helena Convertible Notes over the next
twelve-month period and has made no determinations to date regarding which Digital Assets, if any, will be acquired with any such subsequent tranche. However, the Company believes that closing a second tranche within twelve months from
the date of this Quarterly Report is certainly possible, assuming that all stipulations for doing so have been satisfied at that point in time. Closings of subsequent tranches may occur under the Helena Note Purchase Agreement in
increments of $5 million, provided that the outstanding aggregate principal amount of all Helena Convertible Notes issued under prior tranches is below $2 million and certain other conditions stipulated by the Helena Note Purchase
Agreement are satisfied. The maturity date of the Initial Convertible Note is January 17, 2027, at which point all remaining principal and unpaid interest thereon is due and payable. As more thoroughly discussed elsewhere herein, the
Initial Convertible Note, as with all Helena Convertible Notes, may be converted prior to maturity into shares of the Company’s Common Stock. Any such conversion of the Initial Convertible Note would have the concomitant effect of
reducing the principal balance thereof, thereby permitting the potential issuance of another tranche of Helena Convertible Notes. The Company has no means of predicting when any such conversion rights will be exercised.
Side Letter with Helena
On December 3, 2025, in connection with the Merger Agreement described below, the Company entered into a side letter (the “Side Letter”) with Helena Global Investment Opportunities 1 Ltd. (“Helena”). The Side
Letter amended (i) the Securities Purchase Agreement dated July 18, 2025, (ii) the Convertible Promissory Note issued to Helena on July 18, 2025, and (iii) the Company’s Equity Line of Credit Purchase Agreement, dated October 29, 2024, as
amended (the “ELOC Agreement”).
Under the Side Letter, and provided that no Event of Default occurs and that the Company complies with the Side Letter through February 28, 2026:
| • |
Sales limitations on Helena’s conversions:
|
| o |
Helena agreed that it will not sell any Conversion Shares on a trading day unless the daily trading volume of the Company’s common stock exceeds $1,000,000; and
|
| o |
Helena agreed that its daily sales of Conversion Shares will not exceed 10% of that day’s total trading volume.
|
| • |
Mandatory capital-raising obligation:
|
The Company is required to submit Advance Notices under the ELOC Agreement in aggregate amounts sufficient for the
Company to receive net proceeds of at least $7,500,000 on or before February 28, 2026.
The Company is required to use its best efforts to comply with Article VII of the ELOC Agreement so that the Company is
able to continue delivering Advance Notices in accordance with the terms of the facility.
The Side Letter further provides that if (i) an Event of Default occurs under the Convertible Promissory Note after the
date of the Side Letter, or (ii) the Company is unable to deliver compliant Advance Notices under the ELOC Agreement for more than five (5) trading days due to the Company’s action or omission, Helena will no longer be bound by the sale
limitations described above.
These amendments materially impact the Company’s near-term liquidity planning, capital-raising obligations, and potential
equity market activity. The Company intends to rely on its ability to access capital under the ELOC Agreement in order to satisfy these obligations; however, there can be no assurance that such capital will be available on favorable terms
or at all.
Merger Agreement
On December 3, 2025, the Company entered into an Agreement and Plan of Merger (as may be amended, supplemented or
otherwise modified from time to time, the “Merger Agreement” and the transactions contemplated thereby including the Merger, PIPE Investment and Domestication, collectively, the “Transactions”), by and among the Company, Southern, and
Sierra Merger Sub, Inc., a Delaware corporation and a newly-formed wholly-owned subsidiary of the Company (“Merger SubCo”).
The Transactions are structured as follows:
| (a) |
concurrent with the signing of the Merger Agreement, an investor and current shareholder of Southern (the “Southern Investor”) purchased common shares, without par value, of the Company (the “Pre-Domestication Company Shares”) at
a price per share of $15.58, for an aggregate equity investment of approximately $2,000,000 (the “PIPE Investment” and such shares, the “PIPE Shares”);
|
| (b) |
prior to the Effective Time of the Merger, the Company will migrate to and domesticate as a Delaware corporation (the “Domestication”); and
|
| (c) |
at the Effective Time, Merger SubCo will merge with and into Southern with Southern surviving the merger as the surviving corporation (the “Merger”), pursuant to which existing equity in Southern will
be exchanged for equity in the Company resulting in shareholders of Southern (the “Southern Shareholders”) holding, inclusive of the PIPE Shares, seventy percent (70%) of the Company Shares on a fully-diluted basis upon completion
of the Transactions (but without regard to any Company Shares reserved for issuance under the Company Equity Incentive Plan that are not subject to any option, grant or other award thereunder).
|
Merger Conditions, Termination Rights, and Related Fees
The consummation of the Merger described above is subject to a number of closing conditions, including but not limited to:
| • |
approval of the Company’s shareholders of the resolutions required to effect the Domestication and the Merger;
|
| • |
effectiveness of the Registration Statement on Form S-4 relating to the issuance of shares in the Merger;
|
| • |
receipt of required regulatory approvals;
|
| • |
conditional approval of the Company’s Post-Domestication common stock for listing on Nasdaq;
|
| • |
completion of the Domestication;
|
| • |
the accuracy of the representations and warranties of both parties at closing (subject to materiality qualifiers);
|
| • |
the absence of a Company Material Adverse Effect or Southern Material Adverse Effect; and
|
| • |
Southern maintaining at least $10 million of assets on its balance sheet at the Effective Time, subject to certain permitted offsets.
|
The Merger Agreement may be terminated by either party under certain circumstances, including:
| • |
by mutual written consent;
|
| • |
if the Company’s shareholders do not approve the required resolutions;
|
| • |
if a governmental authority issues a final, non-appealable order prohibiting the Transactions;
|
| • |
if the Merger has not been completed by the “Outside Date,” which is nine months from signing (subject to limited extensions); or
|
| • |
due to uncured material breaches by either party or the occurrence of a material adverse effect affecting the other party.
|
Under certain circumstances, the Company may be required to pay a termination fee equal to 3.1% of (i) the total number of Company shares outstanding on the termination date multiplied by
(ii) the 10-day volume-weighted average price of the Company’s shares. These circumstances include, among others, failure to obtain shareholder approval followed by the Company entering into or consummating an acquisition transaction within
twelve months, or the Company terminating the Merger Agreement to enter into a superior proposal.
If the Merger Agreement is terminated because the Company’s shareholders do not approve the required resolutions, the Company must also reimburse Southern for its reasonable, documented
expenses in an amount not to exceed 1% of the same denominator used in calculating the termination fee.
As a result, depending on the circumstances of termination, the Company could incur significant financial obligations. The Company’s ability to complete the Merger or satisfy any such obligations is subject to
the risks and uncertainties described elsewhere in this report, including in “Risk Factors” and “Liquidity and Capital Resources.”
Nasdaq Notification Letter
On November 18, 2025, the Company received a notification letter (the “Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Company no longer satisfies the minimum net income
from continuing operations requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(3). The Notice also indicated that the Company does not meet the alternative standards relating to stockholders’
equity or market value of listed securities.
The Notice has no immediate effect on the listing or trading of the Company’s common stock, which continues to trade on the Nasdaq Capital Market under the symbol “DEVS.” In accordance with Nasdaq Listing Rule 5810(c)(2)(C), the Company
has until January 2, 2026 to submit a plan to regain compliance (the “Compliance Plan”). If Nasdaq accepts the Compliance Plan, Nasdaq may grant the Company an extension of up to 180 calendar days from the date of the Notice to evidence
compliance with the applicable listing standards.
If Nasdaq does not accept the Compliance Plan, or if the Company fails to regain compliance within any extension period that may be granted, Nasdaq staff will issue a delisting determination. The Company would then have the right to
appeal such determination; however, there can be no assurance that any such appeal would be successful.
The Company intends to submit the Compliance Plan within the required time period and is evaluating potential actions to regain compliance, which may include capital-raising transactions, operational measures, strategic transactions, or
other actions permitted under Nasdaq rules. There can be no assurance, however, that the Company will be able to regain or maintain compliance with the continued listing standards.
Interdependencies Among Recent Developments
The developments described above are interrelated and collectively impact the Company’s liquidity, capital resources, and ability to execute its strategic plans, including the Merger. The
Company’s cryptocurrency treasury strategy requires that a significant portion of proceeds from the Crypto Strategy Convertible Debt be used to acquire and hold digital assets. In addition, under the Side Letter with Helena dated December
3, 2025, the Company is required to deliver Advance Notices under the ELOC Agreement sufficient for the Company to receive net proceeds of at least $7.5 million prior to February 28, 2026, and to maintain compliance with Article VII of the
ELOC Agreement to preserve its ability to submit Advance Notices.
The Company’s ability to satisfy these obligations is influenced by market conditions, trading volume in the Company’s common stock, and the Company’s ongoing access to capital under both
the Crypto Strategy Convertible Debt and the ELOC Agreement. Failure to meet these obligations could result in Helena no longer being bound by the agreed-upon limitations on the daily amount of Conversion Shares it may sell, which may
increase the volatility of the Company’s common stock or place downward pressure on the trading price.
In addition, satisfaction of the Merger closing conditions— including receipt of shareholder approval, maintenance of Nasdaq listing, and avoidance of any Company Material Adverse Effect—may be affected by the
Company’s liquidity position and its ability to comply with the Side Letter and the ELOC Agreement. The Company’s Nasdaq deficiency notice, described above, further underscores the importance of executing these financing and liquidity
initiatives.
These interdependencies may materially affect the Company’s liquidity outlook, the timing and likelihood of completing the Merger, and the Company’s overall capital structure. Additional discussion of these
factors is included under “Liquidity and Capital Resources” and “Risk Factors.”
Registration Rights
Pursuant to the Merger Agreement, the Company has agreed to promptly after the Closing of the Merger, register the resale of the shares issued to Southern’s shareholders in the Merger who are deemed to be an
affiliate of the Company immediately after the Closing of the Merger.
Side Letter
Additionally, in connection with the Merger Agreement, on December 3, 2025, the Company and Helena Global Investment Opportunities 1 Ltd. (“Helena”) entered into a Side Letter (the “Side Letter”) pursuant to
which, among other things, they amended (i) that certain Securities Purchase Agreement (the “Convertible Note Purchase Agreement”) entered into as of July 18, 2025 by and between the Company and Helena, (ii) that certain Convertible
Promissory Note (the “Convertible Promissory Note”), dated July 18, 2025, issued by the Company in favor of Helena, and (iii) that certain Purchase Amendment, dated as of October 29, 2024, Company (then known as Focus Impact Acquisition
Corp.) and Helena, as amended by that certain First Amendment thereto, dated as of March 18, 2025, and that certain Second Amendment thereto, dated as of August 1, 2025, between the Company (the “ELOC Purchase Agreement”). For additional information regarding the Side Letter, please see the related disclosures under the caption “Subsequent Events” below.
PIPE Investment
In connection with the Merger Agreement, on December 3, 2025, the Company entered into a securities purchase
agreement (the “SPA”) with an investor and current shareholder of Southern (the “Investor”), pursuant to which the Company agreed to issue and sell to the Investor an aggregate of 128,370 PIPE Shares, for an aggregate purchase price of
approximately $2,000,000 or $15.58 per PIPE Share. The SPA contains customary representations, warranties and covenants of the Company and the Investor.
The PIPE Investment was made in reliance on the private offering exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506(b) of
Regulation D promulgated thereunder. The PIPE Shares have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption
from registration requirements.
The Company expects to use the net proceeds from the PIPE Investment for general corporate purposes, including transaction-related costs in connection with the Merger and the Domestication. Up to $350,000 of
such net proceeds will be used to satisfy Southern’s expenses related to the Transactions.
Results of Operations — Three Months Ended October 31, 2025 Comparison Against the Three Months Ended October 31, 2024
|
|
For the Three
Months Ended
October 31, 2025
|
For the Three
Months Ended
October 31, 2024
|
||||||
|
Revenue
|
1,100
|
-
|
||||||
|
Cost of sales
|
(1,884
|
)
|
-
|
|||||
|
Gross profit
|
(784
|
)
|
-
|
|||||
|
Sales and marketing
|
49,038
|
271,895
|
||||||
|
Depreciation
|
-
|
361
|
||||||
|
General and administrative
|
578,567
|
57,335
|
||||||
|
Professional fees
|
1,163,650
|
1,409,373
|
||||||
|
Salaries and wages
|
7,077
|
281,022
|
||||||
|
Share-based compensation
|
(11,627
|
)
|
207,236
|
|||||
|
Total operating expenses
|
(1,786,705
|
)
|
(2,227,222
|
)
|
||||
|
Staking income
|
14,334
|
-
|
||||||
|
Accretion and interest expense
|
(501,215
|
)
|
(57,305
|
)
|
||||
|
Loss on investment in associate
|
(89,567
|
)
|
-
|
|||||
|
Change in fair value of derivative liabilities
|
(1,500
|
)
|
(1,348,350
|
)
|
||||
|
Change in fair value of mandatory convertible debentures
|
-
|
70,500
|
||||||
|
Change in the fair value of warrant liabilities
|
2,283,298
|
(488,132
|
)
|
|||||
|
Loss on revaluation of cryptocurrencies
|
(423,481
|
)
|
-
|
|||||
|
Loss on settlement of accounts payable
|
-
|
(8,377
|
)
|
|||||
|
Gain on settlement of debt
|
17,007
|
-
|
||||||
|
Stop-loss provision
|
(29,530
|
)
|
-
|
|||||
|
Foreign exchange gain (loss)
|
(3,403
|
)
|
2,452
|
|||||
|
Net loss
|
(521,546
|
)
|
(4,056,434
|
)
|
||||
During the three months ended October 31, 2025, we incurred a net loss of $521,546 compared to net loss of $4,056,434 for the three months ended October 31, 2024. An analysis of the
decrease in net loss of $3,534,888, including the major components our results for the periods, is below.
Share-based compensation
During the three months ended October 31, 2025, we incurred share-based compensation of $(11,627) compared to share-based compensation of $207,236 for the three months ended October 31,
2024. Share-based payments relating to the vesting of RSUs decreased by $84,448. Share-based payments relating to the vesting of Options decreased by $134,415.
Due to the listing of the Company on the NASDAQ on November 7, 2024 and commencement of trading of shares in the United States dollars, exemptions available under ASC 718-10-25-14 to classify stock options with
strike prices in foreign currencies as equity were no longer met and all stock options outstanding were reassessed to be derivative liabilities. The fair value of the stock options upon the change in classification on November 6, 2024 was
$330,090. Changes in fair value due to period end fair value remeasurements are reflected in compensation expense. Please refer to Note 13 of the interim financial statements.
Professional fees
During the three months ended October 31, 2025, we incurred $1,163,650 in professional fees, as compared to $1,409,373 during the three months ended October 31, 2024. The reduction in
professional fees reflects the fact that no Business Combination–related legal services were incurred in the current period, whereas such services were required in the comparative period.
Salaries and wages
During the three months ended October 31, 2025 and 2024, we incurred salaries and wages of $7,077 and $281,022, respectively. The decrease is attributable to the reversal of employee
benefits expenses accrued in earlier periods, which were reconciled and recognized in the current quarter.
Sales and marketing
Sales and marketing expenses for the three months ended October 31, 2025 and 2024 amounted to $49,038 and $271,895, respectively. The decrease is mainly attributable to expenditures in the
comparative period associated with publications, industry events, and investor relations efforts undertaken following our listings on the Cboe Exchange in 2023 and Nasdaq in 2024. The Company did not incur similar costs in the current
period.
General and administrative
General and administrative expenses for the three months ended October 31, 2025 and 2024 amounted to $578,576 and $57,335, respectively, and primarily comprised of insurance costs, filing
fees and rent. The increase reflects elevated insurance expenses as well as the recognition of filing and printing fees incurred in relation to the Company’s various U.S. filings during the quarter.
Loss on investment in associate
On November 6, 2024, the Company received 2,000,000 shares in Freedom Carbon Solutions LLC (formerly Monroe Sequestration Partners, LLC) (“FCS”), in connection with an agreement to
acquire a stake in FCS in exchange for 200,000 shares of the Company that was entered into on October 28, 2024. At the time of acquisition, the 2,000,000 shares of FCS received by the Company represented 50% of FCS’s shares outstanding.
During the three months ended October 31, 2025, the Company’s share of FCS’s loss was $89,567.
Foreign exchange loss
During the three months ended October 31, 2025 we recognized a foreign exchange loss of $3,403. During the three months ended October 31, 2024, we recognized a foreign exchange gain of
$2,452. The foreign exchange gain and loss result from fluctuations in the Canadian dollar against the US dollar, as we hold cash balances and have accounts payable denominated in both Canadian and US dollars.
Loss on revaluation of cryptocurrencies
During the three months ended October 31, 2025, the Company recorded an unrealized loss of $423,481 on the remeasurement of its cryptocurrency holdings. This variance was driven by
declines in the market prices of Bitcoin and Solana relative to their acquisition costs, resulting in losses of $127,172 and $296,309, respectively. Please refer to Note 6 of the interim financial statements.
Staking income
During the three months ended October 31, 2025, we recognized staking income of $14,334 from our Solana holdings. The income reflects rewards earned for delegating Solana tokens to
validators on the Solana network. Staking rewards are measured at fair value using the market price on the date earned and are recorded as other income. No staking income was recognized in the comparative period as the Company had not yet
initiated its staking program.
Change in fair value of derivative liabilities and mandatory convertible debenture
During the three months ended October 31, 2025, we recognized a loss on derivative liabilities of $1,500 related to the convertible debt financing completed in March 2025 and recorded no
gain or loss on mandatory convertible debentures. In comparison, during the three months ended October 31, 2024, we recognized a loss on derivative liabilities of $1,348,350 and a gain on mandatory convertible debentures of $70,500
related to the January 2024 and April 2024 convertible financings. Please refer to Note 10 of the interim financial statements.
Change in fair value of warrant liabilities
Effective August 1, 2024, the Company reassessed its functional currency and the functional currency of its subsidiaries due to changes in underlying transactions, events, and conditions.
As a result of this reassessment, the Company determined that its functional currency changed from the Canadian dollar (“CAD$”) to the United States dollar (“US$”) for DevvStream Holdings Inc. and DESG. Finco’s functional currency
remained CAD$. This change aligns with the business's future focus and the effective date of the Focus Impact Acquisition Corp.'s Form S-4 Registration Statement with the SEC, a crucial part of the De-SPAC transaction closing. The change
in functional currency was accounted for prospectively from August 1, 2024, with no impact on prior year comparative information. The Company’s presentation currency is and continues to be the United States dollar.
Upon the change in functional currency on August 1, 2024, 121,995 of the Company’s warrants which had strike prices denominated in CAD$ were reclassified as warrant liabilities with an
initial value of $454,571.
On November 6, 2024, 22,699,987 warrants were issued by the Company in connection with the De-SPAC transaction. The warrants were assessed to be derivative liabilities of the Company due
to certain settlement provisions of the warrants that do not meet the criteria for equity classification under Topic 815. The warrants are each exercisable at $1.52 for 0.09692 common stock, expiring on November 6, 2029. The fair value of
the warrants was $7,196,286 upon issuance.
During the three months ended October 31, 2025, we recognized a loss of $2,283,298 due to period end fair value remeasurement. Please refer to Note 11 of the financial statements.
Gain on settlement of debt
On September 18, 2025, the Company paid $31,613 in settlement of an accounts payable in the amount of $48,620 and recognized a gain on the settlement of $17,007.
Stop-loss provision
On November 6, 2024, concurrent with the completion of the business combination, the Company issued 324,987 common shares in consideration for carbon credit purchase agreements.
All of the agreements contain adjustment clauses whereby if the Company’s share price falls below the respective purchase prices outlined in the agreements, in the 12 to 18 months
following November 6, 2024, the Company is obligated to issue additional shares to cover the shortfall. The Company has assessed that the potential liability associated with the stop-loss provision for carbon credits received as of
October 31, 2025 is $1,094,765.
Liquidity and Capital Resources
We continually monitor and manage cash flow to assess the liquidity necessary to fund operations and capital projects. We manage our capital resources and adjust them to take into account
changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust our capital resources, we may, where necessary, control the amount of working capital, pursue financing or manage the timing of
our capital expenditures. As of October 31, 2025, we had a working capital deficit of $13,467,902 (current assets of $1,837,572, less current liabilities of $15,305,474) and as of July 31, 2025, we had a working capital deficit of
$14,412,728 (current assets of $4,337,627, less current liabilities of $18,750,355).
Our continuing operations are dependent upon our ability to obtain debt or equity financing until such time that we achieve profitable operations. There can be no assurance that we will
gain adequate market acceptance for our products or be able to generate sufficient gross margins to reach profitability.
ELOC Agreement
On October 29, 2024, we entered into an equity line of credit purchase agreement (the “ELOC Agreement”) with Helena. Pursuant to the ELOC Agreement, the Company has the right to issue and
to sell to Helena from time to time, as provided in the ELOC Agreement, up to $40,000,000 of Company’s Common Shares, subject to the conditions set forth therein. Specifically, pursuant to the ELOC Agreement, the Company may require that
Helena purchase Common Shares from the Company by delivering one or more advance notices to Helena setting forth, in each advance notice, the amount of the advance it is requesting, which amount may not exceed an amount equal to lesser of
(i) one hundred percent (100%) of the average of the daily value traded of the Common Shares over the ten (10) trading days immediately preceding such advance notice, and (ii) eight million United States Dollars ($8,000,000). On March 18,
2025, the Company and Helena entered into a first amendment to ELOC Agreement, which provides the Company with greater flexibility by allowing Helena to permit Secondary Advances, as defined in the amendment, as well as to update
references to “Common Stock” in the ELOC Agreement to “Common Shares”. However, in no event may the number of Common Shares issuable to Helena pursuant to an advance cause the aggregate number of shares beneficially owned (as calculated
pursuant to Section 13(d) of the Exchange Act) by Helena and its affiliates as a result of previous issuances and sales of Common Shares to Helena under the ELOC Agreement to exceed 9.99% of the then outstanding Common Shares.
Additionally, the Company may not affect any sales under the ELOC Agreement and Helena will have no obligation to purchase Common Shares under the ELOC Agreement to the extent (but only to the extent) that after giving effect to such
purchase and sale the aggregate number of Common Shares issued under the ELOC Agreement would exceed 19.99% of the outstanding shares of Common Shares following the closing of the Business Combination Agreement (the “Exchange Cap”),
provided that, the Exchange Cap will not apply if the Company’s stockholders have approved issuances in excess of the Exchange Cap in accordance with the rules of the Nasdaq. The purchase price for the Common Shares so purchased by Helena
pursuant to an advance notice is the lowest intraday sale price for the Common Shares during the three (3) trading days commencing on the date of Helena’s receipt of the Common Shares relating to such advance. Because the per share
purchase price that Helena will pay for Common Shares in connection with any advance notice we have elected to deliver to Helena pursuant to the ELOC Agreement will be determined by reference to the lowest intraday sale price for the
Common Shares during the three (3) trading days commencing on the date of Helena’s receipt of the Common Shares relating to such advance, we cannot determine the actual purchase price per share that Helena will be required to pay for any
Common Shares that we may elect to sell to Helena under the ELOC Agreement until after we deliver an advance notice and, therefore, we cannot be certain how many Common Shares, in the aggregate, we may issue and sell to Helena under the
ELOC Agreement. Sales of Common Shares to Helena under the ELOC Agreement will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of the Common
Share and determinations by us as to the appropriate sources of funding for our business and operations. We may not be able to raise sufficient funds under the ELOC Agreement to satisfy our obligations.
On August 4, 2025, the Company and Helena entered into a second amendment to ELOC Agreement, which increased the commitment amount from $40,000,000 to $300,000,000. On December 3, 2025, the Company entered into a side letter with Helena I amending the terms of the Company’s existing convertible note and equity line of credit arrangements (Note 8). The amendments
include, among other items, limitations on Helena’s sales of conversion shares, subject to trading-volume conditions, and a requirement that the Company draw a minimum of $7,500,000 in aggregate proceeds under the equity line of credit
prior to February 28, 2026. These limitations may cease to apply if the Company defaults under the convertible note or is unable to submit compliant advance notices under the equity line of credit for more than five trading days.
Since our inception, we have incurred operating losses and have experienced negative cash flows from operations. We do not anticipate that cash on hand will be adequate to satisfy our
obligations in the ordinary course of business over the next 12 months. Based on this assessment, we have material uncertainties about our business that cast substantial doubt about our ability to continue as a going concern. Accordingly,
our ability to continue as a going concern is dependent upon our ability to raise sufficient funds to pay ongoing operating expenditures and to meet our obligations. See further discussion related to our ability to continue as a going
concern within “— Critical Accounting Policies and Estimates.”
ELOC Agreement Side Letter
Additionally, in connection with the Merger Agreement, on December 3, 2025, the Company and Helena entered into the Side Letter pursuant to which, among other things, they amended (i) the Convertible Note
Purchase Agreement entered into as of July 18, 2025 by and between the Company and Helena, (ii) the Convertible Promissory Note, dated July 18, 2025, issued by the Company in favor of Helena, and (iii) the ELOC Purchase Agreement, dated
as of October 29, 2024, as amended, by and between the Company (then known as Focus Impact Acquisition Corp.) and Helena, as follows:
| (1) |
Provided that no Event of Default (as defined in the Convertible Promissory Note) occurs and that the Company complies with the terms of the Side Letter until February 28, 2026, Helena agrees that on any trading day (i) it will
not sell Conversion Shares (as defined in the Convertible Note Purchase Agreement) unless the daily traded volume of the Common Stock is in excess of $1,000,000 on such trading day, and (ii) it will not sell Conversion Shares in
an amount in excess of 10% of the volume of the Common Stock traded on such trading day.
|
| (2) |
The Company agrees that it will submit Advance Notices (as defined in the ELOC Purchase Agreement) pursuant to the ELOC Purchase Agreement in aggregate amount equal so that the Company receives net
proceeds of no less than $7,500,000 prior to February 28, 2026.
|
| (3) |
The Company will use its best efforts to comply with Article VII of the ELOC Purchase Agreement so that it is able to submit Advance Notices thereunder in a manner compliant with the ELOC Purchase
Agreement.
|
Further, pursuant to the Side Letter, the Company acknowledged that if after the date of the Side Letter an Event of Default occurs under the Convertible Promissory Note or if the Company is not able to
submit Advance Notices in a manner compliant with Article VII of the ELOC Agreement, for a period of more than five (5) Trading Days due to an action or omission of the Company, Helena shall cease to be bound by the limitations set forth
in paragraph 1 above.
PIPE Investment
In connection with the Merger Agreement, on December 3, 2025, the Company entered into the SPA with Southern’s sole shareholder at the time of the agreement (the “Investor”), pursuant to which the Company
agreed to issue and sell to the Investor an aggregate of 128,370 PIPE Shares, for an aggregate purchase price of approximately $2,000,000 or $15.58 per PIPE Share. The SPA contains customary representations, warranties and covenants of
the Company and the Investor. In connection with the SPA, the Company and Investor entered into a Company Support & Lock-Up Agreement, pursuant to which, among other things, the Investor agreed to certain transfer restrictions and
stop-transfer instructions reflecting the unregistered status of the PIPE Shares.
The PIPE Investment was made in reliance on the private offering exemption from registration provided by Section 4(a)(2) of the Securities Act, and Rule 506(b) of Regulation D promulgated thereunder. The PIPE
Shares have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
The Company expects to use the net proceeds from the PIPE Investment for general corporate purposes, including transaction-related costs in connection with the Merger and the Domestication. Up to $350,000 of
such net proceeds will be used to satisfy Southern’s expenses related to the Transactions.
Since our inception, we have incurred operating losses and have experienced negative cash flows from operations. We do not anticipate that cash on hand will be adequate to satisfy our
obligations in the ordinary course of business over the next 12 months. Based on this assessment, we have material uncertainties about our business that cast substantial doubt about our ability to continue as a going concern. Accordingly,
our ability to continue as a going concern is dependent upon our ability to raise sufficient funds to pay ongoing operating expenditures and to meet our obligations. See further discussion related to our ability to continue as a going
concern within “- Critical Accounting Policies and Estimates.”
As of October 31, 2025 and July 31, 2025, we had $819,076 and $3,446,111 in cash, respectively. We are actively managing current cash flows until such time that we are profitable.
The chart below highlights our cash flows for the periods indicated:
|
|
For the
Three Months Ended
October 31, 2025
$
|
For the
Three Months Ended
October 31, 2024
$
|
||||||
|
Net cash provided by (used in):
|
||||||||
|
Operating activities
|
(3,037,822
|
)
|
(151,101
|
)
|
||||
|
Investing activities
|
(5,125,000
|
)
|
-
|
|||||
|
Financing activities
|
410,691
|
141,887
|
||||||
|
Effect of exchange rate changes on cash
|
96
|
1,493
|
||||||
|
(Decrease)/Increase in cash
|
(7,752,035
|
)
|
(7,721
|
)
|
||||
Cash Used in Operating Activities
Our net cash used in operating activities is primarily due to cash payments for operating expenses that we incur in the day-to-day operations of the business. Net cash used in operating
activities for the three months ended October 31, 2025 was $3,037,822 compared to $151,101 for the three months ended October 31, 2024. The loss for the three months ended October 31, 2025 of $521,546 was further impacted by $1,302,310 of
changes in working capital items and $1,213,966 in non-cash items, primarily driven by the loss on derivative liability. This compares to a loss of $4,056,434 for the prior period, that was offset by $1,866,072 in changes in working
capital items and $2,039,261 in non-cash items consisting mainly of share-based compensation.
Cash Provided by Investing Activities
Net cash provided by investing activities for the three months ended October 31, 2025 and 2024 was $5,125,000 for purchase of cryptocurrencies and $nil, respectively.
Cash Provided by Financing Activities
We have funded our business to date from the issuance of our common stock and convertible debentures through private placements, from proceeds from the exercises of warrants, and from
loans from related parties.
Net cash provided by financing activities for the three months ended October 31, 2025 was $410,691 compared to $141,887 for the three months ended October 31, 2024. The following
financing activities occurred during the three months ended October 31, 2025:
| (1) |
ELOC drawdown:
|
In August 2025, the Company issued 300,000 shares in accordance with the ELOC Agreement with Helena for gross proceeds of $756,600, of which $189,145 was used to repay the Helena CD, resulting in net proceeds of $567,455.
| (2) |
Repayment of interest on convertible debt with Helena
|
In August 2025, the Company paid $156,764 for the repayment of interest on Helena’s convertible debt.
Related party transactions and balances
SEC rules require us to disclose any transaction or currently proposed transaction in which we are a participant and in which any related person has or will have a direct or indirect material interest
involving an amount that exceeds the lesser of $120,000 or one percent (1%) of the average of the Company’s total assets as of the end of last two completed fiscal years. A related person is any executive officer, Director, nominee for
Director, or holder of 5% or more of the Company’s Common Shares, or an immediate family member of any of those persons.
The Audit Committee of the Board of Directors (or, to the extent applicable, our disinterested directors) is responsible for reviewing all transactions between the Company and any officer or Director of the
Company or any entity in which an officer of Director has a material interest. Any such transactions must be on terms no less favorable than those that could be obtained on an arms-length basis from independent third parties.
Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making
financial and operating decisions. Related parties may be individuals or corporate entities. A transaction is a related party transaction when there is a transfer of resources or obligations between related parties.
At October 31, 2025, the Company had amounts owing and accrued liabilities of $226,410 (July 31, 2025 - $794,990) payable to directors and officers of the Company for salaries, expense
reimbursements and professional fees. These amounts are non-interest bearing and have no terms of repayment.
During the three months ended October 31, 2025, the Company incurred wages and management fees of $113,750 and $120,000, respectively, to officers of the Company. Share based compensation
incurred to officers and directors of the Company amounted to $33,409.
During the three months ended October 31, 2025, the Company accrued interest of $62,622 on convertible debentures payable to related parties.
Contractual Obligations
Prepaid Royalties Agreement with Devvio
In September 2023, we agreed to pay prepaid royalty payments to Devvio, a related party, equal to a minimum of $2,270,000, to be paid by August 1, 2025 and $1,270,000 to be paid by August
1, 2026. On July 8, 2024, we further amended the agreement such that the minimum advances extended by one year and are now due as follows: $1,000,000 by August 1, 2025, followed by $1,270,000 by August 1, 2026 and August 1, 2027. The
agreement is subsequently amended on October 28, 2025 to eliminate the aforementioned payment obligations.
Licensing agreement with Greenlines Technology Inc.
On February 16, 2024, we entered into a licensing agreement with Greenlines Technology Inc. for the use of certain technologies. We agreed to pay $42,000 within 15 days of
the closing of the BCA. Such amount was paid on November 26, 2024. Commencing January 1, 2025, we must pay an annual fee of $12,000 of the first day of each calendar year for the use of the technology. The amounts due on January 1, 2025 are yet to be paid as of October 31, 2025. The Company has accrued $10,000 in connection with the annual fee payable as of October 31, 2025.
Strategic Consulting Agreement with Focus Impact Partners, LLC (“Focus Impact Partners”)
On November 13, 2024, we entered into a strategic consulting agreement with Focus Impact Partners, pursuant to which the Focus Impact Partners will provide us with certain consulting
services (“Strategic Consulting Agreement”) in consideration of an annual consulting fee of $500,000, which will be payable in quarterly installments of $125,000 starting with an initial payment for the period beginning December 31, 2023.
Fees due under the Strategic Consulting Agreement shall accrue and not be payable until (a) we have successfully raised $5,000,000 in outside debt and/or equity capital, cumulatively since the period beginning December 31, 2023 or (b) we
have 2 or more consecutive quarters of positive cash flow from operations. As of October 31, 2025, neither condition has been met. We will pay Focus Impact Partners additional consulting fees as to be mutually agreed consistent with
market practice in connection with any acquisition, merger, consolidation, business combination, sale, divestiture, financing, refinancing, restructuring or other similar transaction. The Strategic Consulting Agreement has a term of three
years unless terminated early with at least 120 days advance notice and will be automatically extended for successive one-year periods at the end of each year unless either party provide a written notice of its desire not to automatically
extend at least 120 days prior to the end of each year during the term of the Strategic Consulting Agreement. Focus Impact Partners is owned by two of the Company’s directors: Carl Stanton and Wray Thorn.
Strategic Partnership Amendment with Devvio, Inc. (“Devvio”)
On October 28, 2025, the Company entered into Amendment No. 4 to the Strategic Partnership Agreement with Devvio, Inc. (“Devvio”), pursuant to which the parties agreed to terminate and fully settle all
remaining rights and obligations under the prior strategic partnership agreement originally entered into in November 2021, as amended, with the exception of certain surviving confidentiality provisions. Concurrently, the parties entered
into a new token-based collaboration to replace the prior arrangement, ensuring continuity of the commercial relationship without interruption.
Under the new Strategic Token Partnership, the Company has committed to purchase Devvio’s DevvE tokens in the amount of USD $1.0 million in 2025 and USD $1.27 million in each of 2026 and 2027. Each annual
purchase will be priced based on the 10-day volume-weighted average price immediately preceding the applicable purchase date and is payable in U.S. dollars or, in certain circumstances, in tokens. In connection with each annual purchase,
the Company will also receive warrants to acquire additional DevvE tokens equal to 25% of the primary purchase amount, exercisable at the same VWAP-based price for a period of three years. If the DevvE token ceases to exist or can no
longer be lawfully issued or traded, the Company will have no further purchase obligations.
Quantitative and Qualitative Disclosures about Market Risk
Our board of directors have overall responsibility for the establishment and oversight of our risk management policies on an annual basis. Management identifies and evaluates our
financial risks and is charged with the responsibility of establishing controls and procedures to ensure financial risks are mitigated in accordance with the approved policies.
Our financial instruments consist of cash, restricted cash, trade receivable, GST receivable, accounts payable and accrued liabilities, convertible debt, warrant liabilities
and derivative liabilities. The carrying value of the Company’s cash, restricted cash, GST receivable and accounts payable and accrued liabilities approximate their fair value due to their
short terms to maturity.
Our risk exposures and the impact on our financial instruments are summarized below:
Credit Risk
Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. Our credit risk is primarily attributable
to our liquid financial assets including cash. Our financial assets are cash, restricted cash, trade receivable, GST receivable, corporate taxes receivable, and deposit on carbon credits purchase. Our maximum exposure to credit risk, as
at period end, is the carrying value of our financial assets, being $2,850,867 and $10,592,093 as of October 31, 2025 and July 31, 2025, respectively. We hold cash with major financial institutions and with a publicly traded payment
processing company therefore minimizing our credit risk.
Liquidity Risk
Liquidity risk is the risk that we will not be able to meet financial obligations as they fall due. We manage liquidity by maintaining adequate cash balances and by raising equity and
debt financings. We have no assurance that such financings will be available on favorable terms in the future. In general, we attempt to avoid exposure to liquidity risk by obtaining corporate financing through the issuance of shares.
As of October 31, 2025, we had cash of $819,076 to settle current liabilities of $10,732,028 which fall due for payment within twelve months of the statement of financial position. As of
July 31, 2025, we had cash of $3,446,111 to settle current liabilities of $11,847,575 which fall due for payment within twelve months of the statement of financial position. All of our contractual obligations are current and due within
one year.
Refer to “— Liquidity and Capital Resources” above.
Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company’s income or value of its holdings or
financial instruments. At October 31, 2025, the Company has minimal exposure to these risks.
Inflation Risk
We do not believe that inflation had a significant impact on our results of operations for any periods presented in our interim financial statements. Nonetheless, if our costs were to
become subject to significant inflationary pressures, we may not be able to fully offset such higher costs, and our inability or failure to do so could harm our business, financial condition and results of operations.
Capital Management
Capital is comprised of our shareholders’ (deficiency) and any debt that we may issue. Our objectives when managing capital are to maintain financial strength and to protect our ability
to meet ongoing liabilities, to continue as a going concern, to maintain creditworthiness and to maximize returns for our shareholders over the long term. Protecting the ability to pay current and future liabilities includes maintaining
capital above minimum regulatory levels, current financial strength rating requirements and internally determined capital guidelines and calculated risk management levels. We manage capital structure to maximize financial flexibility by
making adjustments in response to changes in economic conditions and the risk characteristics of the underlying assets and business opportunities. We do not presently utilize any quantitative measures to monitor our capital, but rather we
rely on our management’s expertise to sustain the future development of the business. Management reviews its capital management approach on an ongoing basis and believes that this approach, given our size, is reasonable.
There were no changes to our approach to capital management during the period. We are not subject to externally imposed capital requirements.
Inflation Reduction Act of 2022 (the “IR Act”)
On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other measures, a new U.S. federal 1% excise tax on
certain repurchases (including redemptions) of stock by publicly traded domestic (i.e., U.S.) corporations. The excise tax is imposed on the repurchasing corporation and the amount of the excise tax is generally 1% of the fair market
value of the stock repurchased. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases
during the same taxable year. In addition, certain exceptions apply to the excise tax. The Treasury has been given authority to provide regulations and other guidance to carry out, and prevent the abuse or avoidance of the excise tax. The
IR Act applies only to repurchases that occur after December 31, 2022.
During the second quarter of 2024, the IRS issued final regulations with respect to the timing and payment of the excise tax. Pursuant to those regulations, the Company would need to file
a return and remit payment for any liability incurred during the period from January 1, 2023 to December 31, 2023 on or before October 31, 2024. For certain taxpayers affected by Hurricane Beryl, the deadline to file such returns and
remit such payment has been extended to February 2025.
The Company is currently evaluating its options with respect to payment of this obligation. If the Company is unable to pay its obligation in full, it will be subject to additional
interest and penalties which are currently estimated at 10% interest per annum and a 5% underpayment penalty per month or portion of a month up to 25% of the total liability for any amount that is unpaid from November 1, 2024 until paid
in full.
Emerging Growth Company Status
We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we will take advantage of certain exemptions from various reporting
requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder
approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that
is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards.
The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not
to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised
standard at the time private companies adopt the new or revised standard.
Smaller Reporting Company
Additionally, we are a “smaller reporting company,” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure
obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of our common stock held
by non-affiliates exceeds $250 million as of the last business day of our second fiscal quarter, or (ii) our annual revenue exceeded $100 million during such completed fiscal year and the market value of our common stock held by
non-affiliates exceeds $700 million as of the last business day of our second fiscal quarter. If we continue to be a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions
from these certain reduced disclosure requirements that are available to smaller reporting companies.
Evaluation of Disclosure of Controls and Procedures
Based on an evaluation as of October 31, 2025, our management, including the Chief Executive Officer and Chief Financial Officer, has concluded that our disclosure controls and procedures
(as defined in Rule 13a-15(e) under the Exchange Act) were not effective to provide reasonable assurance because of a material weakness in our internal control over financial reporting as described below. There have been no changes during
the three months ended October 31, 2025.
Material Weakness
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material
misstatement of our annual or interim financial statements will not be prevented or detected in a timely manner.
We did not design or maintain an effective control environment commensurate with financial reporting requirements. Specifically, we did not consistently have documented evidence of review
procedures and, due to resource limitations, did not always maintain segregation of duties between preparing and reviewing analyses, and reconciliations.
The above material weakness did not result in a material misstatement of our consolidated financial statements, however, it could result in a misstatement of our account balances or
disclosures that would result in a material misstatement that would not be prevented or detected.
Remediation Activities
We are working to remediate the material weakness and are taking steps to strengthen our internal control over financial reporting through the continued hiring of additional appropriately
skilled finance and accounting personnel with the requisite technical knowledge and skills. With the additional skilled personnel, we are taking appropriate and reasonable steps to remediate this material weakness through the
implementation of appropriate segregation of duties, formalization of accounting policies and controls and retention of appropriate expertise for complex accounting transactions. We will not be able to fully remediate these control
deficiencies until these steps have been completed and have been operating effectively for a sufficient period of time. Management will continue to review and make necessary changes to the overall design of our internal control
environment, as well as policies and procedures to improve the overall effectiveness of internal control over financial reporting. The material weakness will not be considered remediated, however, until the applicable controls operate for
a sufficient period of time and management has concluded that these controls are operating effectively.
Strategic Partnership Agreement
On October 28, 2025, the “Company, and Devvio, Inc., a corporation organized under the laws of Delaware (“Devvio”) entered into a fourth amendment (the “Fourth Amendment”) to that Strategic
Partnership Agreement dated November 28, 2021, as amended by (i) Amendment No. 1 dated November 30, 2021, (ii) Amendment No. 2 dated September 12, 2023, and (iii) Amendment No. 3 dated July 8, 2024 (collectively, the “Strategic
Partnership Agreement”).
The Fourth Amendment provides that the existing rights and obligations under the Strategic Partnership Agreement, with the exception of confidentiality obligations and the obligations set forth in the Fourth
Amendment, are fully settled, discharged and of no further force or effect. The Fourth Amendment establishes a Strategic Token Program between the parties whereby DevvStream agrees to purchase DevvE tokens annually in the amount of
$1,000,000 in 2025 and $1,270,00 in each of 2026 and 2027 (each such amount, the “Purchase Amount”). In exchange, and as part of the Strategic Token Program, DevvStream shall receive warrants to acquire additional DevvE tokens equal to
twenty-five percent (25%) of the Purchase Amount which shall be exercisable at the same 10-day VWAP price that was used to determine the number of tokens purchased.
Subsequent Events
Nasdaq Notification Letter
On November 18, 2025, the Company received a notification letter (the “Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that its net income
from continuing operations had fallen below the minimum requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(3) (the “Minimum Net Income Requirement”) and that the Company does not meet the
alternatives of market value of listed securities or stockholders’ equity (collectively with the Minimum Net Income Requirement, the “Continued Listing Standards”). In accordance with Nasdaq Listing Rule 5810(c)(2)(C), the Company has
until January 2, 2026, which is 45 calendar days from the date the Notice was received, to provide Nasdaq with a plan to regain compliance with the Continued Listing Standards (the “Compliance Plan”).
If Nasdaq accepts the Compliance Plan, Nasdaq may grant an extension of up to 180 calendar days from the date of the Notice for the Company to evidence compliance. If Nasdaq does not accept the Compliance
Plan, then the Nasdaq staff will provide written notification to the Company that its common stock will be subject to delisting. The Company may appeal Nasdaq’s rejection of the Compliance Plan and any such determination to delist its
securities, but there can be no assurance that any such appeal would be successful. The Company intends to submit the Compliance Plan to Nasdaq within the required time period. There can be no assurance that Nasdaq will accept the
Compliance Plan, that the Company will be successful in achieving its Compliance Plan, or that the Company will be able to regain or maintain compliance with the Continued Listing Standards.
Neither the Notice nor the Company’s non-compliance have an immediate effect on the listing or trading of the Company’s common stock, which will continue to trade on The Nasdaq Capital
Market under the symbol “DEVS.”
Merger Agreement
On December 3, 2025, the Company entered into the Merger Agreement, by and among the Company, Southern, and Merger SubCo. The terms of the Merger and the related Transactions, which contain customary
representations and warranties, covenants and closing conditions, are summarized below. Capitalized terms used in this Quarterly Report on Form 10-Q but not otherwise defined herein have the meanings given to them in Merger Agreement.
The Transactions are structured as follows:
| (a) |
concurrent with the signing of the Merger Agreement, the Southern Investor purchased the Pre-Domestication Company Shares at a price per share of $15.58, for an aggregate equity investment of approximately $2,000,000;
|
| (b) |
prior to the Effective Time of the Merger, the Company will migrate to and domesticate as a Delaware corporation; and
|
| (c) |
at the Effective Time, Merger SubCo will merge with and into Southern with Southern surviving the merger as the surviving corporation, pursuant to which existing equity in Southern will be exchanged
for equity in the Company resulting in shareholders of Southern (the “Southern Shareholders”) holding, inclusive of the PIPE Shares, seventy percent (70%) of the Company Shares on a fully-diluted basis upon completion of the
Transactions (but without regard to any Company Shares reserved for issuance under the Company Equity Incentive Plan that are not subject to any option, grant or other award thereunder).
|
Registration Rights Pursuant to the Merger Agreement, the Company has agreed to promptly after the Closing of the Merger , register the resale of the shares issued to Southern’s shareholders in the Merger who
are deemed to be an affiliate of the Company immediately after the Closing of the Merger.
Domestication
In connection with the Domestication, (i) each issued and outstanding Pre-Domestication Company Share will convert automatically, on a one-for-one basis, into one share of common stock of the Company
following the Domestication, par value $0.0001 per share (the “Post-Domestication Company Shares” and, together with the Pre-Domestication Company Shares, the “Company Shares,” as applicable), (ii) each issued and outstanding Company
Convertible Security and Company Warrants that are exercisable for, or convertible into, Pre-Domestication Company Shares will convert automatically, on a one-for-one basis, into a convertible security or warrant (as applicable) that is
exercisable for or convertible into an equivalent number of Post-Domestication Company Shares on terms that are substantially similar to the terms of the Company Convertible Security and Company Warrant so converted, and (iii) all the
property, rights, privileges, agreements, powers and franchises, debts, Liabilities, duties and obligations of the Company immediately prior to the Domestication (including under the Transaction Documents) will continue and will be the
property, rights, privileges, agreements, powers and franchises, debts, Liabilities, duties and obligations of the Company following the Domestication.
Merger Proxy Statement/Prospectus and Stockholder Meeting
As promptly as practicable after the execution of the Merger Agreement, (i) the Company and Southern will prepare a registration statement on Form S-4 or other appropriate form in connection with the issuance
of the Post-Domestication Company Shares in the Merger (including any amendments or supplements thereto) (the “Registration Statement”); and (ii) the Company will cause the Registration Statement and such other documents to be filed or
furnished with the Securities Authorities and Nasdaq, as applicable and required by Law and the rules of the Nasdaq, respectively, and disseminated to each Company Shareholder and Southern Shareholder and other Person as required by Law.
Promptly following the Registration Statement being declared effective, and within the time period provided in the proxy statement/prospectus contained therein, the Company will convene and conduct its special meeting of Company
Shareholders to consider the Transactions.
Merger Closing
The consummation of the Merger will be on a date no later than two Business Days following the satisfaction or waiver of all of the closing conditions.
Merger Representations, Warranties and Covenants
The Merger Agreement contains customary representations and warranties of the Company, Southern and Merger SubCo relating to, among other things, their ability and authority to enter into the Merger Agreement
and their capitalization and operations. The parties have also agreed to customary covenants including, without limitation, in connection with required regulatory filings for the Merger, requirements regarding Alternative Transaction
proposals, certain restrictions on the operations of the Company and Southern prior to the Closing and the delivery of certain financial statements. In addition, prior to the Effective Time, (i) the Company may elect, with Southern’s
prior consent, to undertake a re-organization so long as such re-organization does not among other things, have material adverse consequences to the Company or the Company Shareholders and (ii) Southern shall use commercially reasonable
efforts to enter into one or more binding, long-term offtake agreements in connection with its development of biomass to fuel plant in or around St. Charles Parish, Louisiana (the “Plant”).
Merger Proxy Statement/Prospectus and Stockholder Meeting
As promptly as practicable after the execution of the Merger Agreement, (i) the Company and Southern will prepare a registration statement on Form S-4 or other appropriate form in connection with the issuance
of the Post-Domestication Company Shares in the Merger (including any amendments or supplements thereto) (the “Registration Statement”); and (ii) the Company will cause the Registration Statement and such other documents to be filed or
furnished with the Securities Authorities and Nasdaq, as applicable and required by Law and the rules of the Nasdaq, respectively, and disseminated to each Company Shareholder and Southern Shareholder and other Person as required by Law.
Promptly following the Registration Statement being declared effective, and within the time period provided in the proxy statement/prospectus contained therein, the Company will convene and conduct its special meeting of Company
Shareholders to consider the Transactions.
Merger Closing
The consummation of the Merger will be on a date no later than two Business Days following the satisfaction or waiver of all of the closing conditions.
Merger Representations, Warranties and Covenants
The Merger Agreement contains customary representations and warranties of the Company, Southern and Merger SubCo relating to, among other things, their ability and authority to enter into the Merger Agreement
and their capitalization and operations. The parties have also agreed to customary covenants including, without limitation, in connection with required regulatory filings for the Merger, requirements regarding Alternative Transaction
proposals, certain restrictions on the operations of the Company and Southern prior to the Closing and the delivery of certain financial statements. In addition, prior to the Effective Time, (i) the Company may elect, with Southern’s
prior consent, to undertake a re-organization so long as such re-organization does not among other things, have material adverse consequences to the Company or the Company Shareholders and (ii) Southern shall use commercially reasonable
efforts to enter into one or more binding, long-term offtake agreements in connection with its development of biomass to fuel plant in or around St. Charles Parish, Louisiana (the “Plant”).
Termination Generally
The Merger Agreement contains certain termination rights, including, among others:
| • |
termination by either the Company or Southern: (a) upon mutual written consent; (b) if the requisite Company Shareholders fail to approve the Company Resolutions; (c) Laws or Orders prohibit or
enjoin the consummation of the Transactions that have become final and nonappealable; or (d) the Effective Time does not occur on or prior to that date that is the nine (9) month anniversary of the date of the Agreement (the
“Outside Date”), subject to a one-time thirty (30)-day extension if the parties mutually agree and a 60-day extension by the Company or Southern if the Registration is not declared effective by the Outside Date;
|
| • |
termination by the Company: (a) if Southern has an uncured material breach; (b) the Company enters into a Superior Proposal prior to the approval by the Company Shareholders of the Merger; or (c) there has been a Southern
Material Adverse Effect; and
|
| • |
termination by Southern: (a) if the Company has an uncured material breach; (b) the Company’s Board of Directors changes its recommendation in certain circumstances in favor of the Merger or enters
into a Superior proposal; or (c) there has been a Company Material Adverse Effect.
|
Termination Fee
The Company will owe a termination fee to Southern equal to 3.1% of the product of the Company Shares outstanding as of the date of termination and the volume weighted average price of the
Company Shares for then ten (10) trading day period ending on the date of termination if:
| • |
(A) the Merger Agreement is terminated (1) by either Southern or the Company because the requisite Company Shareholders fail to approve the Company Resolutions, (2) by either Southern or the Company
because the Outside Date has passed or (3) by Southern because the Company has an uncured material breach, (B) an Acquisition Proposal has been publicly disclosed or made known to the Company prior to such termination and (C)
concurrently with or within 12 months after the date of any such termination, (x) the Company or any Company Subsidiary enters into a definitive agreement to effect any Acquisition Proposal or (y) any Acquisition Proposal is
consummated;
|
| • |
Southern terminates the Merger Agreement because the Company’s Board of Directors changes its recommendation in certain circumstances in favor of the Merger or approves, recommends or authorizes the
Company to enter into a written agreement concerning a Superior Proposal; or
|
| • |
The Company terminates the Merger Agreement to enter into a Superior Proposal.
|
Termination Reimbursement
If the Merger Agreement is terminated by the Company or Southern because the requisite Company Shareholders fail to approve the Company Resolutions, the Company shall reimburse Southern its reasonable,
documented expenses in an amount not to exceed 1% of the product of the Company Shares outstanding as of the date of termination and the volume weighted average price of the Company Shares for then ten (10) trading day period ending on
the date of termination.
Other Expenses
Company and Southern will each pay 50% of any filing fees payable for or in respect of any application, notification or other filing made in respect of the Transactions, including any fees, costs and expenses
in connection with (i) the preparation, filing and approval by the SEC of the Registration Statement and (ii) the preparation and of filing with a Governmental Authority of any antitrust filings.
Support & Lock-Up Agreements
In connection with signing the Merger, (i) the Company, Southern and the Core Company Securityholders each entered into Company Support & Lock-Up Agreement and (ii) the Company, Southern and the Southern
Investor as of the date of the Agreement (the “Signing Southern Shareholder”) entered into the Southern Support & Lock-Up Agreement (collectively, the “Support & Lock-Up Agreement), each dated December 3, 2025, pursuant to which
(i) each of the Core Company Securityholders and the Signing Southern Shareholder agreed to vote any Company Shares held by him, her or it in favor of the Transactions, and provided customary representations and warranties and covenants
related to the foregoing, and (ii) each of the Core Company Securityholders and the Signing Southern Shareholder has agreed to certain transfer and lock-up restrictions.
ELOC Agreement Side Letter
Additionally, in connection with the Merger Agreement, on December 3, 2025, the Company and Helena entered into the Side Letter pursuant to which, among other things, they amended (i) the
Convertible Note Purchase Agreement entered into as of July 18, 2025 by and between the Company and Helena, (ii) the Convertible Promissory Note, dated July 18, 2025, issued by the Company in favor of Helena, and (iii) the ELOC Purchase
Agreement, dated as of October 29, 2024, as amended, by and between the Company (then known as Focus Impact Acquisition Corp.) and Helena, as follows:
| (1) |
Provided that no Event of Default (as defined in the Convertible Promissory Note) occurs and that the Company complies with the terms of the Side Letter until February 28, 2026, Helena agrees that
on any trading day (i) it will not sell Conversion Shares (as defined in the Convertible Note Purchase Agreement) unless the daily traded volume of the Common Stock is in excess of $1,000,000 on such trading day, and (ii) it will
not sell Conversion Shares in an amount in excess of 10% of the volume of the Common Stock traded on such trading day.
|
| (2) |
The Company agrees that it will submit Advance Notices (as defined in the ELOC Purchase Agreement) pursuant to the ELOC Purchase Agreement in aggregate amount equal so that the Company receives net
proceeds of no less than $7,500,000 prior to February 28, 2026.
|
| (3) |
The Company will use its best efforts to comply with Article VII of the ELOC Purchase Agreement so that it is able to submit Advance Notices thereunder in a manner compliant with the ELOC Purchase
Agreement.
|
Further, pursuant to the Side Letter, the Company acknowledged that if after the date of the Side Letter an Event of Default occurs under the Convertible Promissory Note or if the Company is not able to
submit Advance Notices in a manner compliant with Article VII of the ELOC Agreement, for a period of more than five (5) Trading Days due to an action or omission of the Company, Helena shall cease to be bound by the limitations set forth
in paragraph 1 above.
PIPE Investment
In connection with the Merger Agreement, on December 3, 2025, the Company entered into the SPA with an investor and
current shareholder of Southern (the “Investor”), pursuant to which the Company agreed to issue and sell to the Investor an aggregate of 128,370 PIPE Shares, for an aggregate purchase price of approximately $2,000,000 or $15.58 per PIPE
Share. The SPA contains customary representations, warranties and covenants of the Company and the Investor.
The PIPE Investment was made in reliance on the private offering exemption from registration provided by Section 4(a)(2) of the Securities Act, and Rule 506(b) of Regulation D promulgated thereunder. The PIPE
Shares have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
The Company expects to use the net proceeds from the PIPE Investment for general corporate purposes, including transaction-related costs in connection with the Merger and the Domestication. Up to $350,000 of
such net proceeds will be used to satisfy Southern’s expenses related to the Transactions.
Registration Rights Agreement
In connection with the PIPE Investment, the Company and the Investor entered into a registration rights agreement, dated as of December 3, 2025 (the “RRA”), pursuant to which the Company agreed to register
the resale of the PIPE Shares and the shares to be issued to certain Southern Shareholders in connection with the Merger (and, as applicable, any securities issued or issuable with respect to the PIPE Shares by way of stock split, stock
dividend, recapitalization, the Domestication or similar event) as set forth therein.
Pursuant to the RRA, the Company has agreed to promptly after the Closing of the Merger or the termination of the Merger Agreement, as applicable, register the resale of the shares issued in connection with
the PIPE as well as the shares issued to Southern’s shareholders in the Merger who are deemed to be the Company’s affiliates immediately after the Closing of the Merger.
| 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 otherwise required under this item.
| Item 4. |
Controls and Procedures.
|
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed,
summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial
officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Under the supervision and with the participation of our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness
of our disclosure controls and procedures as of the end of the fiscal period ended October 31, 2025, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive
officer and principal financial officer concluded that during the period covered by this report, our disclosure controls and procedures were not effective because we did not design or maintain an effective control environment commensurate
with financial reporting requirements. Specifically, we did not consistently have documented evidence of review procedures and, due to resource limitations, did not always maintain segregation of duties between preparing and reviewing
analyses, and reconciliations.
A material weakness, as defined in the SEC regulations, is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that
there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The above material weakness did not result in a material
misstatement of our unaudited condensed consolidated financial statements or our consolidated financial statements, however, it could result in a misstatement of our account balances or disclosures that would result in a material
misstatement that would not be prevented or detected.
In light of this material weaknesses, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with
U.S. generally accepted accounting principles.
We are working to remediate the material weakness and are taking steps to strengthen our internal control over financial reporting through the continued hiring of
additional appropriately skilled finance and accounting personnel with the requisite technical knowledge and skills. With the additional skilled personnel, we are taking appropriate and reasonable steps to remediate this material weakness
through the implementation of appropriate segregation of duties, formalization of accounting policies and controls and retention of appropriate expertise for complex accounting transactions. We will not be able to fully remediate these
control deficiencies until these steps have been completed and have been operating effectively for a sufficient period of time. Management will continue to review and make necessary changes to the overall design of our internal control
environment, as well as policies and procedures to improve the overall effectiveness of internal control over financial reporting. The material weakness will not be considered remediated, however, until the applicable controls operate for
a sufficient period of time and management has concluded that these controls are operating effectively.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended October 31, 2025 covered by this Quarterly Report
that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
| Item 1. |
Legal Proceedings
|
To the knowledge of our management, there is no litigation currently pending or contemplated against us, any of our officers or directors in their capacity as such
or against any of our property.
| Item 1A. |
Risk Factors
|
Factors that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in our Annual Report on Form 10-K
filed with the SEC on November 6, 2025. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we
currently deem immaterial may also impair our business or results of operations. Except as set forth below, there have been no material changes to the risk factors previously disclosed under the caption “Risk Factors” in our Annual Report
on Form 10-K.
Risks related to the Merger
The Merger may be delayed or may not be completed, and the Merger Agreement may be terminated in
accordance with its terms.
The completion of the merger is subject to the satisfaction or waiver of a number of conditions as specified in the Merger Agreement, including,
receipt of clearance under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, approval for the post-merger Company’s initial listing application with Nasdaq, as well as other customary closing conditions. No assurance
can be given as to the timing of the satisfaction or waiver of these conditions or that these conditions will be satisfied or waived at all. Accordingly, there can no assurance as to whether or when the Merger will be completed.
In addition, either the Company or Southern may terminate the Merger Agreement under certain circumstances, including if the Merger is not
completed by September 3, 2026 (which date may be extended by thirty or sixty days, under certain circumstances).
Litigation relating to the Merger, if any, could delay or prevent the completion of the Merger and result
in substantial costs to the Company.
Governmental authorities or other third parties with appropriate standing may file litigation challenging the Merger and seeking an order
enjoining or otherwise delaying or prohibiting the completion of the Merger. If any such litigation is successful, then such order may prevent the Merger from being completed, or from being completed within the expected time frame. There
can be no assurance that the Company or any other defendants would be successful in the outcome of any potential future lawsuits. Even if a lawsuit is without merit, it could result in substantial costs to the Company and divert
management time and resources.
Failure to complete the Merger could negatively impact the Company.
If the Merger is not completed for any reason, the ongoing business and financial condition of the Company may be adversely affected, including
in the following ways:
| • |
the Company may experience negative reactions from the financial markets, including negative impacts on the market price of its common shares;
|
| • |
the Company may experience negative reactions from its suppliers, distributors, vendors, customers or other third parties with whom it does business;
|
| • |
the Company may experience negative reactions from employees;
|
| • |
the Company will have incurred, and may continue to incur, significant costs relating to the Merger, such as investment banking, legal, accounting and financial advisor fees and expenses, that it
may not be able to recover;
|
| • |
the Company will have expended significant time and resources that could otherwise have been spent on its existing business or the pursuant of other opportunities without realizing any of the
potential benefits associated with the Merger; and
|
| • |
the Company may face litigation related to the failure to complete the Merger or an enforcement proceeding with respect to its obligations under the Merger Agreement.
|
In addition, if the Merger Agreement is terminated and the Company seeks an alternative transaction, there can be no guarantee that it will be
able to find or complete an alternative transaction on more attractive terms than the Merger or at all.
The Merger Agreement restricts the Company’s business activities prior to the completion of the Merger.
The Merger Agreement places certain restrictions on the operations of the Company and restricts the Company and taking certain other specified
actions without the consent of Southern until the completion of the Merger or the termination of the Merger Agreement. These restrictions, which could be in place for an extended period of time if the completion of the Merger is delayed,
could prevent the Company from pursuing attractive business opportunities that may arise prior to completion of the Merger or from making appropriate changes to business or organizational structure. This could in turn adversely impact the
Company’s results of operations, financial condition and cash flows.
The Merger, including uncertainty regarding the Merger, could disrupt the Company’s business
relationships and adversely affect the Company’s ability to effectively manage its business.
As discussed above, the completion of the Merger is subject to the satisfaction or waiver of several conditions. Many of these conditions are
outside the Company’s control. Furthermore, both the Company and Southern have certain rights to terminate the Merger Agreement. Accordingly, there may be uncertainty regarding the completion of the Merger. This uncertainty may cause
customers, suppliers, vendors, strategic partners or other parties that have business relationships with the Company to delay or defer entering into contracts with, or making other decisions concerning, the Company or to seek to change or
cancel existing business relationships with the Company, which could negatively affect the Company’s business regardless of whether the Merger is ultimately completed. This could in turn adversely impact the Company’s results of
operations, financial condition and cash flows.
The Merger, regardless of whether it is completed, will continue to divert resources from ordinary
operations, which could adversely affect the Company’s business.
The Company has diverted the attention of management and other resources to the Merger. Whether or not the Merger is completed, the pendency of
the Merger will continue to divert the attention of management and other resources from day-to-day operations to the completion of the Merger. This diversion of management attention and other resources could adversely affect the Company’s
ongoing business regardless of whether the Merger is completed.
The Company has incurred and expects to continue to incur significant merger-related costs.
The Company has incurred and expects to continue to incur a number of non-recurring costs associated with negotiating and completing the Merger.
These costs and expenses have been, and will continue to be, significant. These costs and expenses include fees paid or payable to financial, legal and accounting advisors, potential employment-related costs, filing fees, printing
expenses and other related charges. Some of these costs are payable by the Company regardless of whether the Merger is completed. While the Company has assumed that a certain level of expenses would be incurred in connection with the
Merger, there are many factors beyond its control that could affect the total amount or the timing of these expenses. These costs and expenses could adversely impact the Company’s financial condition and liquidity.
Uncertainties associated with the Merger could negatively impact the Company’s ability to attract,
motivate and retain management personnel and other key employees.
Competition for qualified personnel can be intense. Current and prospective employees of the Company may experience uncertainty about their
future role until strategies with regard to these employees are announced or executed, which may impair the Company’s ability to attract, retain and motivate key management, sales, marketing, and other personnel prior to completion of the
Merger. Employee retention may be particularly challenging as employees may experience uncertainty about their future roles with the combined company. If the Company is unable to retain personnel, including key management personnel, it
could face disruptions in its operations, loss of existing customers, loss of key information, expertise or know-how, and unanticipated additional recruitment and training costs.
Failure to meet Nasdaq’s continued listing requirements could result in the delisting of our common
shares, negatively impact the price of our common shares and negatively impact our ability to raise additional capital.
On November 18, 2025, DevvStream Corp. (the “Company”) received a deficiency letter from the Listing Qualifications Department of The Nasdaq
Stock Market LLC (“Nasdaq”) notifying the Company that its net income from continuing operations had fallen below the minimum requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(3) (the
“Minimum Net Income Requirement”) and that the Company does not meet the alternatives of market value of listed securities or stockholders’ equity (collectively with the Minimum Net Income Requirement, the “Continued Listing Standards”).
In accordance with Nasdaq Listing Rule 5810(c)(2)(C), the Company has until January 2, 2026, which is 45 calendar days from the date the Notice was received, to provide Nasdaq with a plan to regain compliance with the Continued Listing
Standards (the “Compliance Plan”).
If Nasdaq accepts the Compliance Plan, Nasdaq may grant an extension of up to 180 calendar days from the date of the Notice for the Company to
evidence compliance. If Nasdaq does not accept the Compliance Plan, then the Nasdaq staff will provide written notification to the Company that its common shares will be subject to delisting. The Company may appeal Nasdaq’s rejection of
the Compliance Plan and any such determination to delist its securities, but there can be no assurance that any such appeal would be successful. The Company intends to submit the Compliance Plan to Nasdaq within the required time period.
There can be no assurance that Nasdaq will accept the Compliance Plan, that the Company will be successful in achieving its Compliance Plan, or that the Company will be able to regain or maintain compliance with the Continued Listing
Standards.
If our common shares are delisted, it could reduce the price of our common shares and the levels of liquidity available to our stockholders. In
addition, the delisting of our common shares could materially adversely affect our access to the capital markets and any limitation on liquidity or reduction in the price of our common shares could materially adversely affect our ability
to raise capital. Delisting from The Nasdaq Capital Market could also result in other negative consequences, including the potential loss of confidence by suppliers, customers and employees, the loss of institutional investor interest and
fewer business development opportunities.
| Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds.
|
Between August 1, 2025 and October 31, 2025, the Company issued shares of its common stock to Helena pursuant to the Company’s existing Equity Line of Credit (“ELOC”) facility. The
issuances were made as drawdowns under the ELOC in exchange for cash proceeds used primarily for working capital and, in certain cases, to fund payments toward the Company’s convertible note obligations under the Helena Note Purchase
Agreement. The shares were issued in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and/or Regulation D promulgated thereunder, as transactions not involving a public
offering.
| Item 3. |
Defaults Upon Senior Securities
|
None.
| Item 4. |
Mine Safety Disclosures.
|
Not applicable.
| Item 5. |
Other Information.
|
During the quarter ended October 31, 2025, no director or officer adopted terminated
| Item 6. |
Exhibits
|
The following exhibits are filed as part of, or incorporated by reference into, this Report on Form 10-Q.
|
Exhibit
Number
|
Description
|
|
Business Combination Agreement, dated as of September 12, 2023, by and among FIAC, Focus Impact Amalco Sub Ltd., and DevvStream Holdings Inc. (incorporated by reference to Exhibit 2.1 to the Current
Report on Form 8-K, filed by FIAC on September 13, 2023).
|
|
|
First Amendment to the Business Combination Agreement, dated as of May 1, 2024, by and among FIAC, Focus Impact Amalco Sub Ltd., and DevvStream Holdings Inc. (incorporated by reference to Exhibit
2.1 to the Current Report on Form 8-K, filed by FIAC on May 2, 2024).
|
|
|
Amendment No. 2 to Business Combination Agreement, dated as of August 10, 2024, by and among FIAC, Amalco Sub and DevvStream (incorporated by reference to Exhibit 2.1 to the Current Report on Form
8-K, filed by FIAC on August 12, 2024).
|
|
|
Waiver to Certain Business Combination Conditions Precedent, dated October 29, 2024, by and between FIAC, Amalco Sub and DevvStream (incorporated by reference to Exhibit 10.7 to the Current Report
on Form 8-K, filed by FIAC on October 30, 2024).
|
|
|
Merger Agreement, dated as of December 3, 2025, by and among the Company, Southern Energy Renewables, Inc. and Sierra Merger Sub, Inc. (incorporated by reference to Exhibit 2.1 to the Current Report
on Form 8-K, filed on December 3, 2025).
|
|
|
Certificate of Continuance of the Company (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K, filed by DevvStream on November 13, 2024).
|
|
|
Articles of Amendment (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K, filed by DevvStream on August 7, 2025).
|
|
|
By-Laws of the Company (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K, filed by New PubCo on November 13, 2024).
|
|
|
Specimen Warrant Certificate (incorporated by reference to Exhibit 4.3 to the Registration Statement on Form S-1, filed by FIAC on June 3, 2021).
|
|
|
Warrant Agreement, dated November 1, 2021, by and between FIAC and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.1 to the Current Report on
Form 8-K, filed by FIAC on November 1, 2021).
|
|
|
Specimen Common Stock Certificate of DevvStream Corp (incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K, filed by New PubCo on November 13, 2024).
|
|
|
Strategic Partnership Agreement, dated November 28, 2021, between Devvio, Inc. and DevvESG Streaming, Inc. (incorporated by reference to Exhibit 10.6 to the Registration Statement on Form S-4, filed
by FIAC on December 4, 2023).
|
|
|
Amendment No. 1 to the Strategic Partnership Agreement, dated November 30, 2021, between Devvio, Inc. and DevvESG Streaming, Inc. (incorporated by reference to Exhibit 10.7 to the Registration
Statement on Form S-4, filed by FIAC on December 4, 2023).
|
|
|
Amendment No. 2 to the Strategic Partnership Agreement, dated September 12, 2023, between Devvio, Inc. and DevvStream, Inc. (f/k/a DevvESG Streaming, Inc.) (incorporated by reference to Exhibit 10.8
to the Registration Statement on Form S-4, filed by FIAC on December 4, 2023).
|
|
|
DevvStream Corp. 2024 Equity Incentive Plan (incorporated by reference to Exhibit 10.4 to the Form 10-Q filed on January 23, 2025).
|
|
|
Form of DevvStream Corp. Indemnification Agreement (incorporated by reference to Exhibit 10.15 to the Registration
Statement on Form S-4, filed by FIAC on March 11 2024).
|
|
Exhibit
Number
|
Description
|
|
Amendment No. 3 to the Strategic Partnership Agreement, dated July 8, 2024, between Devvio, Inc. and DevvStream, Inc. (f/k/a DevvESG Streaming, Inc.) (incorporated by reference to Exhibit 10.17 to
the Registration Statement on Form S-4, filed by FIAC on July 11, 2024).
|
|
|
Sponsor Side Letter, dated as of September 12, 2023, by and among FIAC and Focus Impact Sponsor, LLC (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed by FIAC on
September 13, 2023).
|
|
|
Amendment No. 1 to the Sponsor Side Letter, dated as of May 1, 2024, by and among FIAC and Focus Impact Sponsor, LLC (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K,
filed by FIAC on May 2, 2024)
|
|
|
Amendment No. 2 to Sponsor Letter Agreement, dated October 29, 2024, by and between FIAC and the Sponsor (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed by FIAC
on October 30, 2024).
|
|
|
Contribution and Exchange Agreement, dated October 29, 2024, by and among FIAC, DevvStream and Crestmont (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, filed by FIAC
on October 30, 2024).
|
|
|
Form of PIPE Agreement (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K, filed by FIAC on October 30, 2024).
|
|
|
Form of Carbon Subscription Agreement (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K, filed by FIAC on October 30, 2024).
|
|
|
Amended and Restated Registration Rights Agreement, dated November 6, 2024, by and among FIAC, the Sponsor and certain other legacy DevvStream holders (incorporated by reference to Exhibit 10.13 to
the Current Report on Form 8-K, filed by New PubCo on November 13, 2024).
|
|
|
Registration Rights Agreement, dated October 29, 2024, by and between FIAC and Karbon-X Corp (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K, filed by FIAC on October
30, 2024).
|
|
|
Form of Company Support & Lock-Up Agreement, by and between FIAC, the Sponsor and certain other legacy DevvStream holders (incorporated by reference to Exhibit 10.2 to the Current Report on Form
8-K, filed by FIAC on September 13, 2023).
|
|
|
Purchase Agreement, dated October 29, 2024, by and between FIAC, Helena Global Investment Opportunities I Ltd. and the Sponsor (incorporated by reference to Exhibit 10.6 to the Current Report on
Form 8-K, filed by FIAC on October 30, 2024).
|
|
|
Employment Agreement, dated November 6, 2024, between DevvStream Corp. and Sunny Trinh (incorporated by reference to Exhibit 10.17 to the Current Report on Form 8-K, filed by New PubCo on November
13, 2024).
|
|
|
Employment Agreement, dated November 6, 2024, between DevvStream Corp. and Chris Merkel (incorporated by reference to Exhibit 10.18 to the Current Report on Form 8-K, filed by New PubCo on November
13, 2024).
|
|
|
Strategic Consulting Agreement, dated November 13, 2024, by and between DevvStream Corp. and Focus Impact Partners, LLC (incorporated by reference to Exhibit 10.20 to the Current Report on Form 8-K,
filed by New PubCo on November 13, 2024).
|
|
|
Form of New Convertible Note (incorporated by reference to Exhibit 10.21 to the Current Report on Form 8-K, filed by New PubCo on November 13, 2024).
|
|
|
Security Agreement, dated December 18, 2024, by and among DevvStream Corp., Focus Impact Sponsor, LLC and Focus Impact Partners, LLC (incorporated by reference to Exhibit 10.1 to the Current Report
on Form 8-K, filed by New PubCo on December 19, 2024).
|
|
|
Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed by on July 22, 2025).
|
|
|
Form of Note (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, filed by on July 22, 2025).
|
|
|
Form of Security Agreement (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K, filed by on July 22, 2025).
|
|
|
Form of Subsidiary Guarantee (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K, filed by on July 22, 2025).
|
|
Form of Registration Rights Agreement (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K, filed by on July 22, 2025).
|
|
|
Amendment to Rights Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed by on August 21, 2025).
|
|
|
Crypto Control Account Agreement (incorporated by reference to Exhibit 10.28 to the Registration Statement on Form S-1/A, on September 30, 2025).
|
|
|
Master Purchase Agreement (incorporated by reference to Exhibit 10.29 to the Registration Statement on Form S-1/A, on September 30, 2025).
|
|
|
Custodial Agreement (incorporated by reference to Exhibit 10.30 to the Registration Statement on Form S-1/A, on September 30, 2025).
|
|
|
Consulting Agreement with FRNT (incorporated by reference to Exhibit 10.31 to the Registration Statement on Form S-1/A, on September 30, 2025).
|
|
|
Amendment to Securities Purchase Agreement dated October 27, 2025 by and between the Company and Helena Global Investment Opportunities I Ltd. (incorporated by reference to
Exhibit 10.32 to the Annual Report on Form 10-K, on November 6, 2025).
|
|
|
Amendment to Promissory Note dated October 27, 2025 by and between the Company and Helena Global Investment Opportunities I Ltd. (incorporated by reference to Exhibit 10.33 to
the Annual Report on Form 10-K, on November 6, 2025).
|
|
|
Fourth Amendment to Strategic Partnership Agreement, dated October 27, 2025, between Devvio, Inc. and DevvStream, Inc. (f/k/a DevvESG Streaming, Inc.) (incorporated by reference
to Exhibit 10.1 to the to the Current Report on Form 8-K, filed by on November 3, 2025).
|
|
|
Securities Purchase Agreement, dated as of December 3, 2025, by and between the Company and EEME Energy SPV I LLC. (incorporated
by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed on December 3, 2025).
|
|
|
Registration Rights Agreement, dated as of December 3, 2025, by and between the Company and EEME Energy SPV I LLC. (incorporated by reference to Exhibit 10.2 to the Current
Report on Form 8-K, filed on December 3, 2025).
|
|
|
Form of Company Support & Lock-Up Agreement (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K, filed on December 3, 2025).
|
|
|
Form of Southern Support & Lock-Up Agreement (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K, filed on December 3, 2025).
|
|
|
List of Subsidiaries of DevvStream (incorporated by reference to Exhibit 21.1 to the Current Report on Form 8-K, filed by New PubCo on November 13, 2024).
|
|
|
Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
|
Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
|
|
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
| 32.2** |
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
101.INS*
|
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
|
|
101.SCH*
|
Inline XBRL Taxonomy Extension Schema Document
|
|
101.DEF*
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB*
|
Inline XBRL Taxonomy Extension Labels Linkbase Document
|
|
101.PRE*
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
104*
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
|
* Filed herewith.
** These certifications are furnished to the SEC pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
† Schedules and exhibits to this Exhibit omitted pursuant to Regulation S-K Item 601(b)(2). The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the
SEC upon request.
+ Indicates management contract or compensatory plan.
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 on this 16th day of December, 2025.
|
DEVVSTREAM CORP.
|
||
|
/s/ David Goertz
|
||
|
Name:
|
David Goertz
|
|
|
Title:
|
Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|
||
69