[PART I — FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) AgriFORCE saw revenue growth from Bitcoin mining but a wider **$8.2 million** net loss, with a **$9.7 million** working capital deficiency raising going concern doubts [Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Assets increased to **$15.2 million** by June 30, 2025, driven by Bitcoin mining investments, financed by debentures, resulting in a **$9.7 million working capital deficiency** Consolidated Balance Sheet Highlights (as of June 30, 2025 vs. Dec 31, 2024) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash | $185,313 | $489,868 | | Digital assets | $724,971 | $26,282 | | Total current assets | $1,401,103 | $1,307,233 | | Property and equipment, net | $4,807,533 | $808,895 | | Total assets | $15,243,271 | $10,763,983 | | **Liabilities & Equity** | | | | Debentures | $7,976,752 | $1,443,209 | | Total current liabilities | $11,068,922 | $4,320,265 | | Total liabilities | $11,184,288 | $4,652,730 | | Total shareholders' equity | $4,058,983 | $6,111,253 | - The company had a working capital deficiency of **$9.7 million** as of June 30, 2025, indicating significant short-term liquidity risk[32](index=32&type=chunk) [Condensed Consolidated Statements of Comprehensive Loss](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Revenue surged to **$725,209** for the six months ended June 30, 2025, driven by Bitcoin mining, but net loss widened to **$8.2 million** due to debt extinguishment and discontinued operations losses Statement of Comprehensive Loss Summary (Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Revenue | $725,209 | $41,315 | | Operating Loss | $(3,184,292) | $(2,515,099) | | Net Loss from Continuing Operations | $(6,804,649) | $(7,559,799) | | Net Loss from Discontinued Operations | $(1,401,048) | $0 | | **Net Loss** | **$(8,205,697)** | **$(7,559,799)** | | Basic and Diluted EPS (Total) | $(31.59) | $(290.57) | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operations increased to **$3.1 million**, with **$5.7 million** used in investing for mining facilities, funded by **$8.5 million** in financing, resulting in a cash decrease of **$304,555** Cash Flow Summary (Six Months Ended June 30) | Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(3,056,552) | $(2,228,537) | | Net cash used in investing activities | $(5,683,307) | $0 | | Net cash provided by financing activities | $8,542,000 | $1,363,255 | | **Change in cash** | **$(304,555)** | **$(941,082)** | | Cash, end of period | $185,313 | $2,937,496 | [Notes to Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Condensed%20Financial%20Statements) Notes detail the company's pivot to Bitcoin mining, acquisition of Bald Eagle facility, disposal of RCS, reliance on convertible debentures, and a **going concern warning** - The company has pivoted its strategy to focus on sustainable Bitcoin mining, which began in 2024 and now represents its main operation[28](index=28&type=chunk)[29](index=29&type=chunk) - Management has identified substantial doubt about the company's ability to continue as a going concern due to recurring net losses, a working capital deficiency of **$9.7 million**, and the need for additional financing[32](index=32&type=chunk)[33](index=33&type=chunk) - On January 17, 2025, the company acquired the Bald Eagle Bitcoin mining facility in Ohio for a total purchase price of **$4,765,000**[84](index=84&type=chunk) - On July 1, 2025, the company agreed to return the assets of Radical Clean Solutions (RCS) to the seller, resulting in a loss on disposal of **$904,112** for the period ended June 30, 2025[78](index=78&type=chunk)[101](index=101&type=chunk) - The company has issued multiple tranches of convertible debentures, with down-round provisions that adjust conversion and strike prices downward upon subsequent dilutive equity issuances[103](index=103&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) [Management's Discussion and Analysis (MD&A)](index=43&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A details the company's pivot to energy-first digital infrastructure and Bitcoin mining, with revenue of **$725,209**, increased operating expenses, an **$8.2 million** net loss, and a **going concern warning** - The company has rebranded its strategy to be an "energy-first digital infrastructure company" focusing on modular, off-grid compute platforms for AI, edge computing, and crypto mining[174](index=174&type=chunk) - The company's three-pillar strategy includes: 1) using modular architecture for crypto mining and AI compute, 2) deploying mobile gas-to-power units, and 3) building a strategic digital reserve of Bitcoin[178](index=178&type=chunk) - The weighted average cost to mine one Bitcoin across its facilities is approximately **$44,400**[209](index=209&type=chunk)[210](index=210&type=chunk) - The company is holding up to **50%** of mined Bitcoin as part of a treasury strategy and has begun using its Bitcoin holdings as collateral for loans[206](index=206&type=chunk) [Results of Operations](index=50&type=section&id=Results%20of%20Operations) Revenue increased to **$725,209**, primarily from Bitcoin mining, while total operating expenses rose **53%** to **$3.9 million**, leading to an **$8.2 million** net loss due to debt extinguishment and discontinued operations Revenue Breakdown (Six Months Ended June 30) | Revenue Source | 2025 | 2024 | | :--- | :--- | :--- | | Bitcoin Mining | $724,768 | $0 | | Hydroxyl Devices | $531 | $41,315 | | **Total Revenue** | **$725,209** | **$41,315** | Operating Expenses Comparison (Six Months Ended June 30) | Expense Category | 2025 | 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Cost of revenue | $462,854 | $33,731 | +1272.2% | | Wages and salaries | $1,158,190 | $719,220 | +61.0% | | Professional fees | $579,642 | $329,729 | +75.8% | | Depreciation and amortization | $593,735 | $329,939 | +80.0% | | **Total Operating Expenses** | **$3,909,501** | **$2,556,414** | **+52.9%** | [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is constrained with cash at **$185,313**, a net loss of **$8.2 million**, and a significant working capital deficit, raising substantial doubt about **going concern**, requiring additional capital - The company's financial statements have been prepared on a going concern basis, but factors like recurring losses and a working capital deficit raise substantial doubt about its ability to continue[235](index=235&type=chunk) - To fund operations for the next twelve months, the company will seek additional capital through debt or equity sales, including its At the Market (ATM) facility, but there is no assurance of success[236](index=236&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) AgriFORCE is exempt from providing market risk disclosures as it qualifies as a smaller reporting company - The company is not required to provide quantitative and qualitative disclosures about market risk as it qualifies as a smaller reporting company[243](index=243&type=chunk) [Controls and Procedures](index=55&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[244](index=244&type=chunk) - No material changes were made to the company's internal control over financial reporting during the quarter ended June 30, 2025[245](index=245&type=chunk) [PART II — OTHER INFORMATION](index=56&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [Legal Proceedings](index=56&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ongoing legal matters, including a wrongful termination lawsuit by a former CEO, a settled breach of contract complaint, and a dispute with a Belgian law firm - The company is in litigation with its former CEO, Ingo Mueller, over a wrongful termination claim. The company asserts the termination was for 'just cause' and believes an unfavorable outcome is not probable[152](index=152&type=chunk)[153](index=153&type=chunk)[154](index=154&type=chunk) - A complaint from Stronghold regarding a property purchase agreement was settled in January 2025, with the company agreeing to pay **$20,833** monthly for 12 months[155](index=155&type=chunk) [Risk Factors](index=56&type=section&id=Item%201A.%20Risk%20Factors) AgriFORCE is exempt from providing risk factor disclosures as it qualifies as a smaller reporting company - The company is electing scaled disclosure obligations as a smaller reporting company and is not required to provide risk factors in this filing[249](index=249&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=56&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company conducted unregistered sales of securities, including **$7.7 million** in convertible debentures and a **$290,000** promissory note, triggering down-round provisions - On January 16, 2025, the company sold **$7.7 million** in convertible debentures to investors[250](index=250&type=chunk) - On April 22, 2025, the company sold a promissory note for gross proceeds of **$250,000** (**$290,000** principal)[251](index=251&type=chunk) - Subsequent to the quarter, on July 21, 2025, the company sold an additional **$833,333** in convertible debentures[252](index=252&type=chunk) [Defaults Upon Senior Securities](index=56&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported - The company reported no defaults upon senior securities[255](index=255&type=chunk) [Mine Safety Disclosures](index=56&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable to the company[256](index=256&type=chunk) [Other Information](index=56&type=section&id=Item%205.%20Other%20Information) No other information was reported for this item - The company reported no other information for this item[257](index=257&type=chunk) [Exhibits](index=57&type=section&id=Item%206.%20Exhibits) The report includes required certifications (302 and 906), an amendment to the ATM Agreement, and Inline XBRL data files - Exhibits filed include CEO and CFO certifications (302 and 906), an amendment to the ATM Agreement, and XBRL data files[258](index=258&type=chunk)

Group 1 - The Company announced a reverse stock split where every nine shares will be combined into one share, effective July 28, 2025 [1] - The reverse stock split was approved by shareholders on June 6, 2025, and aims to comply with Nasdaq Listing Rule 5550(a)(2) [1] - As of July 23, 2025, the Company had 7,851,398 shares outstanding, which will reduce to 872,377 shares post-split [1] Group 2 - AgriFORCE Growing Systems Ltd. is focused on creating an integrated platform utilizing technology and intellectual property to provide sustainable solutions [2]

Core Viewpoint - AgriFORCE Growing Systems Ltd. is reaffirming its Bitcoin treasury strategy and has initiated operations at its Berwyn, Alberta site, capitalizing on the recent surge in Bitcoin prices, which surpassed $119,700 on July 14, 2025, driven by institutional inflows and positive regulatory developments [2][4]. Group 1: Bitcoin Treasury Strategy - The company plans to initiate Bitcoin purchases with its next significant capital influx, allocating up to 50% of its net investment capital for this purpose [2][8]. - AgriFORCE is strategically accumulating Bitcoin as a core treasury asset, enhancing financial resilience and shareholder value through expanded BTC accumulation [6][9]. - The company aims to retain up to 50% of self-mined Bitcoin for long-term holdings, leveraging a blended cost basis through low-cost in-house mining [8][9]. Group 2: Operational Developments - The Berwyn Power & Compute site is fully operational, with miners actively generating Bitcoin daily, showcasing the company's rapid deployment capabilities [3][5]. - The site was commissioned on June 17, 2025, and has transitioned from gas flare to Bitcoin production in a matter of days and weeks, demonstrating an efficient decentralized infrastructure model [5][10]. - AgriFORCE is advancing its 1.3 MW expansion agreement with BlueFlare Energy, with additional sites in Oyen and Hinton planned for rapid deployment [12]. Group 3: Infrastructure and Future Plans - The company's growth strategy is built around a three-pillar framework focusing on harnessing stranded energy, deploying sovereign infrastructure, and capitalizing on next-generation compute economies [5][10]. - AgriFORCE is laying the groundwork for future modular infrastructure that supports a wider range of decentralized workloads beyond Bitcoin [10][11]. - The company is exploring stablecoin on/off ramps for improved payment efficiency and liquidity management [14].

Core Insights - AgriFORCE Growing Systems Ltd. has successfully installed and commissioned miners at its Oyen, Alberta site, marking a significant advancement in its Power & Compute Initiative [1][2] - The Oyen site is part of a binding Letter of Intent with BlueFlare Energy Solutions Inc. and aims to optimize performance through load testing [2] - The CEO of AgriFORCE emphasized the strategic importance of utilizing underused natural gas resources to enhance operational efficiency and contribute to the company's Bitcoin treasury [3] Company Developments - The commissioning of miners at the Oyen site is a step towards expanding decentralized computing capabilities and is aligned with AgriFORCE's three-pronged approach: Bitcoin treasury accumulation, modular compute infrastructure, and energy-first monetization [3] - The company plans to grow its fleet of power-efficient mining rigs and explore additional avenues to augment its Bitcoin treasury, including the acquisition of Bitcoin [4] Strategic Partnerships - The collaboration with BlueFlare Energy Solutions Inc. is pivotal for AgriFORCE, as it supports the development of modular, mobile energy and decentralized compute solutions [6]

Core Insights - AgriFORCE Growing Systems Ltd. is enhancing its role in the intersection of agriculture, energy, and digital assets, particularly through its TerraHash Digital™ platform [3][6] - The company is focusing on energy-efficient Bitcoin mining and data center operations while monitoring stablecoin adoption and its implications for digital trade [3][4] Industry Context - The 2025 Bitcoin Policy Summit gathered leaders from finance, technology, energy, and policy sectors to discuss national energy strategy, digital asset regulation, and decentralized technologies [2][5] - Stablecoins are increasingly recognized as vital for the next-generation monetary ecosystem, offering faster and more cost-effective transactions, especially in energy and commodities [4][5] Company Engagement - CEO Jolie Kahn's participation in the Summit underscores AgriFORCE's commitment to responsible innovation and policy engagement in sustainable digital infrastructure [4][6] - The company aims to support the evolving landscape of digital finance by developing the necessary infrastructure for secure mining operations and high-performance data centers [4][6]

Core Viewpoint - AgriFORCE Growing Systems Ltd. has announced a transformative tri-pillar growth strategy to capitalize on the increasing global demand for computational power, focusing on Bitcoin treasury development, modular compute infrastructure, and integration with scalable, off-grid energy systems [1][2]. Group 1: Bitcoin Treasury Development - AgriFORCE is accumulating Bitcoin through self-mining and market acquisition, having mined 7 BTC valued at approximately $750,000 in the past seven months [2]. - The strategy aims to strengthen the company's balance sheet while ensuring liquidity and exposure to the digital asset space [2][4]. Group 2: Compute Infrastructure - The company operates three mining campuses in Alberta and Ohio, delivering around 6 MW of capacity and 0.17 EH/s of hash power, with a target of 1 EH/s by the end of Q1 2026 [3]. - AgriFORCE's model focuses on converting stranded gas into compute power, enabling rapid site activation [3][4]. Group 3: Future-Ready Systems - The modular architecture of AgriFORCE extends beyond crypto mining, providing compute capabilities for AI, edge computing, and sovereign data solutions [3][6]. - This diversification is expected to expand revenue potential and mitigate long-term risks across the digital infrastructure spectrum [3]. Group 4: Energy-Compute Nexus - AgriFORCE positions energy as an advantage in scalable infrastructure, with plans to allocate up to 50% of capital raised toward Bitcoin purchases and retain up to 50% of mined Bitcoin in long-term treasury [4][5]. - The company has secured a partnership with BlueFlare Energy™ Solutions Inc., providing access to over 50 MW of natural gas and a development pipeline expected to exceed 100 MW by 2026 [5].

Core Insights - AgriFORCE Growing Systems Ltd. has announced significant advancements in its Power & Compute strategy, focusing on Bitcoin treasury accumulation, modular compute infrastructure, and energy-first monetization [1][5] Group 1: Operational Milestones - The Berwyn site is the first operational deployment under the Power & Compute Initiative, currently running with a capacity of over 425 kW, with plans to expand to over 625 kW [2][6] - A binding Letter of Intent (LOI) has been signed with BlueFlare Energy™ to develop an additional 1.3 MW of power and compute capacity at two new sites in Alberta [4][6] Group 2: Strategic Vision - The company aims to convert stranded gas into ESG-compliant digital compute rapidly, with a target of reaching 1 EH/s compute capacity by Q1 2026 [3][5][12] - The operational model includes a blended approach where up to 50% of capital raises are allocated to direct Bitcoin purchases, and up to 50% of mined Bitcoin is retained in the corporate treasury [9] Group 3: Infrastructure and Technology - The infrastructure includes high-efficiency mining pods and a proprietary operating system for telemetry and predictive maintenance, ensuring ESG compliance [7][10] - The company has exclusive access to over 50 MW of natural gas, with plans to expand to over 100 MW by 2026, utilizing mobile, off-grid systems to bypass utility delays [12]

Core Insights - AgriFORCE Growing Systems Ltd. has initiated its Power & Compute Initiative through a partnership with BlueFlare Energy Solutions, marking a significant step in deploying modular, efficient infrastructure for Bitcoin mining in Alberta, Canada [1][2] Deployment Overview - The project involves a total deployment of 1.3 megawatts of natural gas-powered Bitcoin mining infrastructure across five sites in Alberta, with a total of 315 Bitmain S21 Pro ASIC miners [2][3] - The deployment is structured in five phases, with specific power capacities and number of miners allocated to each phase [3] Technology Stack - The deployment will utilize BlueFlare's proprietary technology stack, which includes a real-time environmental telemetry system for ESG reporting and carbon credit tracking [4] Strategic Execution - AgriFORCE has committed to a fixed power and hosting cost of $0.065 per kWh for the first two months of operations at the Berwyn Phase 1 site [5] - The full infrastructure deployment is expected to be completed within 90 days, with AgriFORCE securing a 90-day exclusivity window for future opportunities [6] Leadership Commentary - The CEO of AgriFORCE emphasized the project's alignment with their decentralized compute vision and the importance of sustainable infrastructure [7][8] Next Steps - The parties plan to finalize definitive agreements regarding hosting, power, and site lease arrangements by June 30, 2025, with initial work commencing shortly thereafter [8]

Core Insights - AgriFORCE Growing Systems Ltd. has launched a Strategic Power & Compute Initiative in collaboration with BlueFlare Energy Solutions to enhance its TerraHash Digital strategy for high-performance computing infrastructure [1][2] Group 1: Initiative Overview - The Initiative aims to transform stranded or underutilized natural gas resources into decentralized computing infrastructure, supporting applications such as Bitcoin mining and AI [2] - AgriFORCE will finance and acquire BlueFlare's mobile gas-generation units, while BlueFlare will manage the compute infrastructure [3] Group 2: Technological Integration - The Initiative utilizes BlueFlare's platform for remote site management and includes the BlueFlare Carbon Cube for environmental monitoring and emissions management, enhancing sustainability [4] - Features include a unified dashboard for monitoring power consumption and performance, adaptive control systems for hardware longevity, and AI-enabled predictive analytics for maintenance [8] Group 3: Strategic Growth and Rights - AgriFORCE has secured a Right of First Refusal on future BlueFlare-sourced sites, ensuring scalable deployment of digital infrastructure in energy-rich regions [5] - The collaboration is positioned as a model for regional innovation, promoting job creation and carbon offset monetization [6] Group 4: Leadership Perspectives - The CEO of AgriFORCE emphasized the Initiative's role in making computing infrastructure more scalable and sustainable [6] - The CEO of BlueFlare highlighted the potential for generating carbon credits and enhancing operational intelligence through the Initiative [7] Group 5: Company Background - AgriFORCE operates at the intersection of agriculture, clean energy, and digital infrastructure, focusing on high-performance compute environments for decentralized economies [9] - BlueFlare specializes in mobile natural gas-powered generation and decentralized compute technologies, unlocking stranded energy for various applications [10]

Core Insights - AgriFORCE is enhancing its role in sustainable digital infrastructure development through strategic partnerships and initiatives highlighted at Bitcoin 2025 [1][2][6] Group 1: Strategic Partnerships - AgriFORCE deepened relationships with utility operators, data center OEMs, and energy-integrated hosting platforms, initiating co-development dialogues with North American natural gas aggregators and load-balancing software providers [2] - The new synergies are expected to facilitate the deployment of TerraHash Digital sites across underutilized energy corridors [2] Group 2: Investor Engagement - Institutional interest was significant, with positive feedback received from hedge funds and digital asset infrastructure allocators regarding AgriFORCE's hybrid infrastructure-token model [3] - Follow-up discussions are scheduled with investors interested in sustainable compute yields and inflation-hedged hard asset exposure [3] Group 3: Media Coverage and Thought Leadership - AgriFORCE and CEO Jolie Kahn received media attention during the event, participating in panels and interviews that emphasized the company's dual role in regenerative energy systems and high-efficiency computing [4] - Influencers on platforms like YouTube and X amplified the company's message about the intersection of agricultural innovation and decentralized infrastructure [4] Group 4: Commitment to Sustainability - AgriFORCE reaffirmed its commitment to diversity in energy tech and participated in the "Women in Bitcoin" initiative, promoting inclusive leadership in digital infrastructure [5] - The company is scaling initiatives that connect grid optimization with sustainable land and food systems [5] Group 5: Future Plans - AgriFORCE is fast-tracking two pilot deployments in Q3 2025, one in Alberta and another in the U.S. Southeast, focusing on dual-output capabilities [6] - The company is also upgrading its token economics and aligning with Solana for scalable validator integration [6] Group 6: Upcoming Engagements - AgriFORCE plans to maintain momentum through participation in the North American Blockchain Summit and a targeted investor roadshow in New York, Toronto, and Dubai [7] - These efforts aim to increase global awareness and attract capital to its infrastructure pipeline [7] Group 7: Stakeholder Engagement - AgriFORCE invites stakeholders, utilities, tech partners, and investors to schedule briefings to explore partnership opportunities and joint ventures [8]