0001374881false--09-30Q120250.000120000000000.00012000000083796283796283796200013748812024-10-012024-12-310001374881king:PreferredStocksMember2024-12-3100013748812024-10-012024-10-210001374881king:FloridaLimitedLiabilityCompanyMemberking:SixLLCCreditAgreementMember2024-10-210001374881king:FloridaCorporationMemberking:CASCreditAgreementMember2024-10-210001374881king:SixLLCCreditAgreementMember2024-10-012024-10-210001374881king:CASCreditAgreementMember2024-10-012024-10-210001374881king:CASCreditAgreementMember2024-10-210001374881king:SixLLCCreditAgreementMember2024-10-210001374881king:ConvertibleDebtThreeMember2024-12-310001374881king:ConvertibleDebtTwoMember2024-12-310001374881king:ConvertibleDebtOneMember2024-12-310001374881us-gaap:ConvertibleDebtMember2024-12-310001374881king:ConvertibleDebtThreeMember2024-10-012024-12-310001374881king:ConvertibleDebtThreeMember2023-10-012024-09-300001374881king:ConvertibleDebtTwoMember2024-10-012024-12-310001374881king:ConvertibleDebtTwoMember2023-10-012024-09-300001374881king:ConvertibleDebtOneMember2024-10-012024-12-310001374881king:ConvertibleDebtOneMember2023-10-012024-09-300001374881us-gaap:ConvertibleDebtMember2024-10-012024-12-310001374881us-gaap:ConvertibleDebtMember2023-10-012024-09-300001374881king:ConvertibleDebtThreeMember2024-09-300001374881king:ConvertibleDebtTwoMember2024-09-300001374881king:ConvertibleDebtOneMember2024-09-300001374881us-gaap:ConvertibleDebtMember2024-09-3000013748812016-09-1900013748812016-07-1100013748812016-03-0300013748812015-12-070001374881king:MrToomeyOneMember2024-09-300001374881king:MrToomeyOneMember2024-12-310001374881king:MrToomeyOneMember2023-10-012023-12-310001374881king:MrToomeyOneMember2024-10-012024-12-310001374881king:MrToomeyMember2018-11-012018-11-180001374881king:MrToomeyMember2024-12-310001374881king:MrToomeyMember2023-01-012023-12-310001374881king:MrToomeyMember2023-10-012023-12-310001374881king:MrToomeyMember2024-10-012024-12-310001374881king:MrToomeyMember2024-09-300001374881king:JamesKAndLoriMToomeyMember2023-01-012023-12-310001374881king:JamesKAndLoriMToomeyMember2024-12-310001374881king:JamesKAndLoriMToomeyMember2024-09-300001374881king:JamesKAndLoriMToomeyMember2024-10-012024-12-310001374881king:ConchAndShellHoldingsIncMember2023-01-012023-12-310001374881king:ConchAndShellHoldingsIncMember2023-10-012023-12-310001374881king:ConchAndShellHoldingsIncMember2024-10-012024-12-310001374881king:ConchAndShellHoldingsIncMember2024-12-310001374881king:ConchAndShellHoldingsIncMember2024-09-300001374881king:PassingThroughLLCMember2023-10-012023-12-310001374881king:PassingThroughLLCMember2024-10-012024-12-310001374881king:MrToomeyOneMember2021-03-012021-03-070001374881us-gaap:CommonStockMember2021-01-292021-02-010001374881king:JamesKAndLoriMToomeyMember2018-11-012018-11-180001374881king:ConchAndShellHoldingsIncMember2018-11-012018-11-200001374881king:PassingThroughLLCMember2016-06-292016-07-010001374881king:SixLLCAndHancockWhitneyBankMember2024-10-012024-12-310001374881king:SixLLCAndHancockWhitneyBankMember2024-09-300001374881king:MrToomeyOneMember2022-03-070001374881king:MrToomeyMember2018-11-180001374881us-gaap:CommonStockMember2021-02-010001374881king:JamesKAndLoriMToomeyMember2018-11-180001374881king:ConchAndShellHoldingsIncMember2018-11-200001374881king:PassingThroughLLCMember2016-07-010001374881king:JToomeyMember2024-12-310001374881king:JToomeyAndLToomeyMember2024-12-310001374881king:ConchAndShellHoldingIncMember2024-12-310001374881king:PassingThroughLLCMember2024-12-310001374881king:KToomeyMember2024-12-310001374881king:KToomeyMember2024-09-300001374881king:JToomeyMember2024-09-300001374881king:JToomeyAndLToomeyMember2024-09-300001374881king:ConchAndShellHoldingIncMember2024-09-300001374881king:PassingThroughLLCMember2024-09-300001374881us-gaap:SoftwareDevelopmentMember2024-09-300001374881us-gaap:SoftwareDevelopmentMember2024-12-310001374881us-gaap:FurnitureAndFixturesMember2024-09-300001374881us-gaap:FurnitureAndFixturesMember2024-12-310001374881us-gaap:LeaseholdImprovementsMember2024-09-300001374881us-gaap:LeaseholdImprovementsMember2024-12-310001374881king:RenovoResourceSolutionsIncMember2023-10-012023-12-3100013748812023-10-012024-09-3000013748812024-04-012024-04-180001374881us-gaap:RetainedEarningsMember2024-12-310001374881us-gaap:AdditionalPaidInCapitalMember2024-12-310001374881us-gaap:CommonStockMember2024-12-310001374881us-gaap:RetainedEarningsMember2024-10-012024-12-310001374881us-gaap:AdditionalPaidInCapitalMember2024-10-012024-12-310001374881us-gaap:CommonStockMember2024-10-012024-12-310001374881us-gaap:RetainedEarningsMember2024-09-300001374881us-gaap:AdditionalPaidInCapitalMember2024-09-300001374881us-gaap:CommonStockMember2024-09-3000013748812023-12-310001374881us-gaap:RetainedEarningsMember2023-12-310001374881us-gaap:AdditionalPaidInCapitalMember2023-12-310001374881us-gaap:CommonStockMember2023-12-310001374881us-gaap:RetainedEarningsMember2023-10-012023-12-310001374881us-gaap:AdditionalPaidInCapitalMember2023-10-012023-12-310001374881us-gaap:CommonStockMember2023-10-012023-12-3100013748812023-09-300001374881us-gaap:RetainedEarningsMember2023-09-300001374881us-gaap:AdditionalPaidInCapitalMember2023-09-300001374881us-gaap:CommonStockMember2023-09-3000013748812023-10-012023-12-3100013748812024-12-3100013748812024-09-3000013748812025-02-05iso4217:USDxbrli:sharesiso4217:USDxbrli:sharesxbrli:pure

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 December 31, 2024

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 000-52375

Kingfish Holding Corporation

(Exact Name of Registrant as Specified in its Charter)

Delaware		20-4838580
(State or Other Jurisdiction of		(IRS Employer
Incorporation or Organization)		(Identification No.)

822 62nd Street Circle East, Suite 105
Bradenton, Florida		34208
(Address of Principal Executive Offices)		(Zip Code)

(941) 487-3653

(Registrant’s Telephone Number, Including Area Code)

_______________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None

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, a smaller reporting, or an emerging growth company. See definition 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:	☐
Non-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 Act). Yes ☐ No ☒

As of February 5, 2025, the number of issued and outstanding common shares of the registrant was 837,962.

KINGFISH HOLDING CORPORATION

TABLE OF CONTENTS

Item Number in
Form 10‑Q		Page

PART I – Financial Information

Item 1.	Financial Statements	3

	Consolidated Balance Sheets – December 31, 2024 (Unaudited) and September 30, 2024	3

	Consolidated Statements of Operations (Unaudited) for the Three Months Ended December 31, 2024 and 2023	4

	Consolidated Statements of Changes in Stockholders’ Equity (Deficit) (Unaudited) for the Three Months Ended December 31, 2024 and 2023	5

	Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended December 31, 2024 and 2023	6

	Notes to Consolidated Financial Statements (Unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4.	Controls and Procedures	29

PART II – Other Information

Item 1.	Legal Proceedings	30

Item 1A.	Risk Factors	30

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30

Item 3	Defaults on Senior Securities	30

Item 4.	Mine Safety Disclosures	30

Item 5.	Other Information	30

Item 6.	Exhibits	31

Signatures		32

Table of Contents

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

KINGFISH HOLDING CORPORATION
CONSOLIDATED BALANCE SHEETS

	December 31, 2024		September 30, 2024
	(Unaudited)
ASSETS

Current assets
Cash and cash equivalents	$	559,895	$	425,706
Accounts receivable, net		88,240		73,543
Deferred income tax asset		70,320		120,474
Inventory, net		236,778		195,977
Total current assets		955,233		815,700

Due from related party		1,009,580		1,009,580
Right of use asset, net		536,521		645,139
Property and equipment, net		37,939		41,589
Other assets		960		960
Total assets		2,540,233		2,512,968

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities:
Accounts payable	$	30,278	$	126,212
Accrued interest payable		339,809		321,137
Related party loans, current		1,377,171		-
Convertible notes payable to related party		90,000		90,000
Taxes payable		80,108		64,444
Lease liability - current		456,786		447,771
Total current liabilities		2,374,152		1,049,564

Long term liabilities:
Related party loans		-		1,377,671
Lease liability		79,735		197,368
Total liabilities		2,453,887		2,624,603

Commitments and contingencies (Note 13)

Stockholders' equity (deficit):
Preferred stock, par $0.0001, 20,000,000 shares authorized, 0 shares issued and outstanding		-		-
Common stock, par $0.0001, 200,000,000 shares authorized, 837,972 shares issued and outstanding		84		84
Paid-in capital		-		-
Retained earnings (accumulated deficit)		86,262		(111,719	)
Total stockholders' equity (deficit)		86,346		(111,635	)
Total liabilities and stockholders' equity (deficit)	$	2,540,233	$	2,512,968

See accompanying notes to unaudited consolidated financial statements

Table of Contents

KINGFISH HOLDING CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED

	For the three months ended
	December 31,
	2024			2023

Revenues:
Sales	$	1,536,631		$	822,579
Cost of goods sold		987,212			529,096

Gross profit		549,419			293,483

Expenses:
Operating expenses:
Professional fees		99,681			31,750
Rent expense		120,000			120,000
General and administrative		51,404			35,201
Payroll expense		91,013			96,056
Total operating expenses		362,098			283,007

Income from operations		187,321			10,476

Other income (expense):
Interest income		-			2,992
Interest expense		(18,672	)		(19,073	)
Gain on extinguishment of accounts payable		95,150			-
Total other income (expense)		76,478			(16,081	)

Net income (loss) before income taxes		263,799			(5,605	)

Provision for income taxes		65,818			(1,399	)

Net income (loss)	$	197,981		$	(4,206	)

Basic and diluted earnings per share on net income (loss)
Basic	$	0.24		$	(0.01	)
Diluted	$	0.24		$	(0.01	)

Weighted average shares outstanding
Basic		837,972			600,000
Diluted		838,152			600,000

See accompanying notes to unaudited consolidated financial statements

Table of Contents

KINGFISH HOLDING CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED DECEMBER 31, 2024 AND 2023 UNAUDITED

							Retained
	Common Stock						Earnings
			Par		Paid In		(Accumulated
	Shares		$0.0001		Capital		Deficit)			Total
Balance - September 30, 2024		837,972	$	84	$	-	$	(111,719	)	$	(111,635	)

Net income		-		-		-		197,981			197,981

Balance - December 31, 2024		837,972	$	84	$	-	$	86,262		$	86,346

	Common Stock
			Par		Paid In		Retained
	Shares		$0.0001		Capital		Earnings			Total
Balance - September 30, 2023		600,000	$	60	$	-	$	790,814		$	790,874

Net loss		-		-		-		(4,206	)		(4,206	)

Balance - December 31, 2023		600,000	$	60	$	-	$	786,608		$	786,668

See accompanying notes to unaudited consolidated financial statements

Table of Contents

KINGFISH HOLDING CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED

	For the three months ended
	December 31,
	2024			2023

CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	197,981		$	(4,206	)
Adjustment to reconcile net (loss) income to net cash provided by operating activities:
Depreciation expense		3,650			3,650
Gain on extinguishment of accounts payable		(95,150	)		-
Changes in operating assets and liabilities:
Accounts receivable		(14,697	)		(24,218	)
Inventory		(40,802	)		38,807
Deferred tax asset		50,154			111,844
Accounts payable		(784	)		19,333
Accrued interest payable		18,672			(202,360	)
Taxes payable		15,665			(117,519	)
Net change in operating activities		134,689			(174,669	)

CASH FLOWS FROM INVESTING ACTIVITIES
Net change in investing activities		-			-

CASH FLOWS FROM FINANCING ACTIVITIES
Related party loans, net		(500	)		(56,522	)
Net change in financing activities		(500	)		(56,522	)

Net Increase (Decrease) in Cash		134,189			(231,191	)

Cash - Beginning of the Period		425,706			821,770

Cash - End of the Period	$	559,895		$	590,579

Supplemental Disclosures of Cash Flows
Cash paid for Interest	$	-		$	225,712
Cash paid for income taxes	$	-		$	-

See accompanying notes to unaudited consolidated financial statements

Table of Contents

KINGFISH HOLDING CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024

1. Business:

Our Business:

Kingfish Holding Corporation (the “Company”) was incorporated in the State of Delaware on April 11, 2006 as Offline Consulting, Inc. It became Kesselring Holding Corporation on June 8, 2007 and on November 25, 2014 it changed its name to Kingfish Holding Corporation.

The primary business of the Company is to serve the recycling needs of the south Tampa Bay region. The Company built a recycling center on 10 plus acres in the southern area of the county to service customers of Manatee and Sarasota Counties. The Company purchases and containerizes both ferrous and non-ferrous materials for resale to a variety of off-take partners in more than 60 product categories. Customers are both residential and commercial in nature.

As disclosed in the Company’s previous filings, on April 19, 2024 (the “Closing Date”), the Company and Renovo Resource Solutions, Inc., a Florida corporation (“Renovo”), consummated a merger transaction pursuant to which Renovo was merged with and into the Company (the “Merger”), with the Company being the legal successor or surviving corporation in the Merger (the “Closing”). As a condition to the Merger, on April 18, 2024, the Company effected a reverse stock split at a ratio of one-for-five hundred, meaning that each 500 shares of the Company’s common stock (“Common Stock”) were converted into one share of the Common Stock. Subsequently, on the Closing Date, Kingfish and Renovo consummated the Merger and the transactions contemplated thereby, including the issuance of 600,000 shares of Common Stock (the “Merger Shares”) to the owners of Renovo (the “Renovo Owners”).

2. Summary of Significant Accounting Policies:

Basis of consolidation:

The accompanying consolidated financial statements, which include the accounts of the Company and Renovo have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”), and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company for the three months ended December 31, 2024 and 2023. The consolidated financial statements have been prepared using the accrual basis of accounting in accordance with GAAP and presented in US dollars. They should be read in conjunction with the annual financial statements reported in the latest Form 10-K filed for the year ended September 30, 2024. The results of operations of any interim period are not necessarily indicative of the results for the full year. The fiscal year end is September 30.

Use of estimates:

The preparation of financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Table of Contents

Cash:

Cash is maintained at a financial institution and, at times, the balance may exceed federally insured limits. The Company has never experienced any losses related to the balance. Currently, the FDIC provides insurance coverage up to $250,000 per depositor at each financial institution and, at times, the Company’s cash balance may exceed the covered limits. The amount in excess of FDIC limits at December 31, 2024 and September 30, 2024 was $157,224 and $65,630, respectively.

For purposes of the consolidated statements of cash flows, the Company considers all highly-liquid investments with a maturity of three months or less when purchased to be cash.

Inventories:

Inventories are stated at the lower of cost or net realizable value. Cost, which includes raw materials is determined on a first-in, first-out basis. On a monthly basis, the Company analyzes its inventory levels and reserve for inventory that is expected to expire prior to being sold, inventory that has a cost basis in excess of its expected net realizable value, inventory in excess of expected net realizable value, inventory in excess of expected sales requirements, or inventory that fails to meet commercial sale specifications. Expired inventory is disposed of and the related costs are written off to inventory obsolescence.

Accounts Receivable and Credit Losses

Accounts receivable is stated at net realizable value. The Company estimates and record a provision for expected credit losses related to its consolidated financial instruments, including its trade receivables. The Company considers historical collection rates, the current financial status of its customers, macroeconomic factors, and other industry-specific factors when evaluating for current expected credit losses. Forward-looking information is also considered in the evaluation of current expected credit losses. However, because of the short time to the expected receipt of accounts receivable, the Company believes that the carrying value, net of expected losses, approximates fair value and therefore, the Company relies more on historical and current analysis of such financial instruments, including its trade receivables.

Further, the Company considers macroeconomic factors and the status of the technology industry to estimate if there are current expected credit losses within its trade receivables based on the trends and its expectation of the future status of such economic and industry-specific factors. Also, specific allowance amounts are established based on review of outstanding invoices to record the appropriate provision for customers that have a higher probability of default.

Property and equipment, net:

Property and equipment are stated at cost at the date of purchase less accumulated depreciation. Depreciation is calculated using the accelerated methods over the lesser of the estimated useful lives of the assets or the lease term. The useful lives range from three to seven years. The Company’s policy is to capitalize renewals and betterments acquired for greater than $500 and expense normal repairs and maintenance as incurred. The Company’s management periodically evaluates whether events or circumstances have occurred indicating that the carrying amount of long-lived assets may not be recovered.

Convertible Debentures

The Company adheres to the guidance in Accounting Standards Updated (“ASU”) 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 simplifies an issuer’s accounting for convertible instruments and its application of the derivatives scope exception for contracts in its own equity. Additionally, ASU 2020-06 removes the requirements for accounting for beneficial conversion features.

Table of Contents

Fair Value of Financial Instruments:

The carrying amounts of cash and current liabilities approximate fair value because of the short maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. Management does not hold or issue financial instruments for trading purposes, nor does the Company utilize derivative instruments in the management of the Company’s foreign exchange, commodity price or interest rate market risks.

The Financial Accounting Standards Board (“FASB”) Codification clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

	Level 1:	Quoted prices in active markets for identical assets or liabilities

	Level 2:	Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability

	Level 3:	Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Revenue Recognition:

The Company recognizes revenues in accordance with Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers,” and all related interpretations for recognition of its revenue from services. Revenue is recognized when the following criteria are met:

	·	identification of the contract, or contracts, with the customer;

	·	identification of the performance obligations in the contract;

	·	determination of the transaction price;

	·	allocation of the transaction price to the performance obligations in the contract; and

	·	recognition of revenue when, or as, the Company satisfies the performance obligation.

The Company primarily generates revenue by purchasing scrap metal from businesses and retail customers, processing it, and selling the ferrous and non-ferrous metals to clients.

The Company realizes revenue upon the fulfillment of its performance obligations to customers. The performance obligation is fulfilled when the product is shipped or picked up by the customer.

Cost of Goods Sold:

Cost of goods sold is primarily comprised of direct costs of purchasing materials from customers, including hauling, freight and fuel.

Table of Contents

Leases:

The Company accounts for leases in accordance with ASC 842, “Leases.”

Operating leases right-of use (“ROU”) assets represents the right to use the leased assets for the lease term and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available at the adoption date in determining the present value of future payments. Lease expense for minimum lease payments is amortized on a straight-line basis over the lease term and is presented on the consolidated statements of operations.

Income Taxes:

Deferred taxes are provided on the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Future tax benefits for net operating loss carry forwards are recognized to the extent that realization of these benefits is considered more likely than not. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

The Company follows the provisions of FASB ASC 740-10 “Uncertainty in Income Taxes” (ASC 740-10). A reconciliation of the beginning and ending amount of unrecognized tax benefits has not been provided since there are no unrecognized benefits for all periods presented. The Company has not recognized interest expense or penalties as a result of the implementation of ASC 740-10. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefit in interest expense and penalties in operating expenses.

Net income (loss) per share:

Basic income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of outstanding common shares during the period of computation. Diluted loss per share gives effect to potentially dilutive common shares outstanding. The Company gives effect to these dilutive securities using the If-Converted Method. Potentially dilutive securities include convertible financial instruments.

At December 31, 2024 and 2023, convertible notes payable to related party of $90,000 can potentially convert into 180 shares of Common Stock. For the three months ended December 31, 2023, the Company had a net loss. As a result, these shares have been excluded from the diluted net loss per share calculations for the three months ended December 31, 2023 because the effect of including them would be anti-dilutive. For the three months ended December 31, 2024, the Company had net income. As such, the shares have been included in the diluted net income per share for the three months ended December 31, 2024.

Segment Reporting:

In November 2023, the FASB issued ASU 2023-07, *Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures*, enhancing segment expense transparency. We have adopted this standard in the current fiscal year. We have determined that we have one reportable segment, which includes acquiring salvage and reselling scrap metals processed and unprocessed ferrous and nonferrous metals from a variety of sources including, manufacturing and industrial plants, metal fabrication plants, electric utilities, machine shops, factories, refineries, demolition businesses, wrecking companies, contractors, and retail individuals. The single segment was identified based on how the Chief Operating Decision Maker, who we have determined to be our Chief Executive Officer, manages and evaluates performance and allocates resources.

Table of Contents

Going Concern:

These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The principal conditions or events that raised doubt about the Company's ability to continue as a going concern is negative working capital and prior period net loss. In the current period, the Company had net income, net income from operations, and positive cash flows from operations. Based on evaluation of the conditions above, and mitigating factors, management has determined the risk of going concern to be alleviated.

3. Reverse Merger and Reverse Recapitalization

Merger – Renovo Resource Solutions, Inc.:

On April 19, 2024, Kingfish completed the Merger with Renovo. On the Closing Date, the parties consummated the Merger whereby Renovo was merged with and into Kingfish with Kingfish as the surviving legal entity.

Pursuant to the merger, each share of Renovo’s stock issued and outstanding immediately prior to the Effective Time, subject to and upon the terms and conditions set forth in the Merger Agreement, was cancelled and extinguished and were collectively converted automatically into 600,000 shares of Common Stock. As a result of the merger, on the effective date of April 19, 2024, the Renovo Owners owned 71.6% of Kingfish’s issued and outstanding Common Stock immediately upon Closing without taking into account any shares of Common Stock held by the Renovo Owners prior to the Merger.

The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as entities under common control. In ASC 805, control has the same meaning as controlling financial interest. A “controlling financial interest” is generally defined as ownership of a majority voting interest by one entity, directly or indirectly, of more than 50% of the outstanding voting shares of another entity. It was determined that James K. Toomey had a controlling interest in both Kingfish and Renovo. As a result the transaction has been accounted for as a reverse recapitalization with Renovo as the accounting acquirer and Kingfish as the accounting acquiree. The financial reporting will reflect the accounting from the perspective of Renovo, except for the legal capital, which have been retroactively adjusted to reflect the capital of Kingfish in accordance with ASC 805-40-45-1. The cost of the acquisition, which represents the consideration transferred to Kingfish’s stockholders in the Merger, was calculated based on the fair value of common stock of the combined company that Kingfish stockholders own as of the closing of the Merger on April 19, 2024.

The merger transaction is considered to be a capital transaction of the legal acquiree and is equivalent to the issuance of shares by the private entity for the net monetary assets of the public shell corporation accompanied by a recapitalization.

The number of shares of Common Stock issued immediately following the consummation of the Reverse Recapitalization were as follows:

	Number of
	shares
Common Stock outstanding at April 19, 2024 prior to Merger		237,972
Common stock issuable to Renovo Owners		600,000
Total shares of Common Stock as of close of Reverse Recapitalization		837,972

Table of Contents

Pro Forma Disclosures

The following unaudited pro forma financial results reflects the historical operating results of the Company, including the unaudited pro forma results of Renovo for the three months ended December 31, 2023, respectively, as if the Merger had occurred as of October 1, 2023. The pro forma financial information set forth below reflects adjustments to the historical data of the Company to give effect to the Merger and the related equity issuances as if each had occurred on October 1, 2023. The pro forma information presented below does not purport to represent what the actual results of operations would have been for the periods indicated, nor does it purport to represent the Company’s future results of operations. The following table summarize on an unaudited pro forma basis the Company’s results of operations for the three months ended December 31, 2023:

	For the three months ended
	December 31,
	2023
Net revenue	$	822,579
Net loss	$	(62,085	)
Net loss per share- basic	$	(0.10	)
Weighted average number of shares of common stock outstanding- basic and diluted		600,000

The calculations of pro forma net revenue and pro forma net loss give effect to the Merger for the period from October 1, 2023 until the respective closing dates for (i) the historical net revenue and net income (loss), as applicable, of the acquired businesses, (ii) incremental depreciation and amortization for each business combination based on the fair value of property, equipment and identifiable intangible assets acquired and the related estimated useful lives, and (iii) recognition of accretion of discounts on obligations with extended payment terms that were assumed in the business combinations.

4. Operating Lease Right-of-Use Asset and Operating Lease Liability

In connection with the closing on the merger (See “Note 3”), the Company entered into a lease agreement with 6 LLC, a Florida limited liability company (“6 LLC”) on April 19, 2024. Under the terms of the Lease the Company is leasing the buildings and property (“Property”) on which the Company conducts its operations from 6 LLC for annual rent of $480,000 paid in twelve (12) monthly payments of $40,000, which is inclusive of electrical, water, sewer, and other utilities. The Lease has an initial term of two years and may be extended for a period of up to five (5) additional years by the Company. The terms of the Lease include customary terms regarding alterations to the Property, maintenance by 6 LLC, insurance, and indemnification and generally reflect terms that would be typically negotiated in an at arm’s-length transaction with modifications to the termination provisions of the Lease to limit 6 LLC’s ability to terminate the Lease in light of the Purchase Option Agreement. Further, the Lease limits 6 LLC’s ability to assign the Lease, while preserving the right of the Company to assign the Lease under certain circumstances.

Operating lease right-of-use asset and liability are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value is the incremental borrowing rate, estimated to be 8%, as the interest rate implicit in most of the Company’s leases is not readily determinable. Operating lease expense is recognized on a straight-line basis over the lease term. Since the common area maintenance expenses are expenses that do not depend on an index or rate, they are excluded from the measurement of the lease liability and recognized in general and administrative expenses on the consolidated statements of operations. During the three months ended December 31, 2024 and 2023, the Company recorded $120,000 in rent expense, respectively, related to this lease.

Table of Contents

Right-of-use asset is summarized below:

	December 31, 2024			September 30, 2024
Office lease	$	890,318		$	890,318
Less: accumulated amortization		(353,797	)		(245,179	)
Right-of-use asset, net	$	536,521		$	645,139

Operating lease liability is summarized below:

	December 31, 2024			September 30, 2024
Office lease	$	536,521		$	645,139
Less: current portion		(456,786	)		(447,771	)
Long term portion	$	79,735		$	197,368

Maturity of the lease liability is as follows:

	Total
Year ending December 31, 2025	$	360,000
Year ending December 31, 2026		200,000
Total future minimum lease payments		560,000
Less: imputed interest		(23,479	)
Present value of payments	$	536,521

5. Receivables and Loans from Related Parties:

The Company has paid operational expenses and debt on behalf of 6 LLC, a related party who holds the real estate on which the business operates. As of December 31, 2024 and September 30, 2024, the total paid on behalf of 6 LLC and payable to the Company is $1,009,580. These advances bear no interest, are uncollateralized and have no specific due date.

The above transactions and amounts are not necessarily what third parties would have agreed to.

6. Inventory:

The composition of the Company inventories at December 31, 2024 and September 30, 2024 are as follows:

	December 31, 2024		September 30, 2024

Raw Materials	$	236,778	$	195,977
Inventories, at cost	$	236,778	$	195,977

Table of Contents

7. Property and Equipment:

Property and equipment consisted of the following at December 31, 2024 and September 30, 2024:

	December 31, 2024			September 30, 2024
Leasehold improvements	$	7,826		$	7,826
Software		19,637			19,637
Furniture and equipment		675,614			675,614
		703,077			703,077
Less: Accumulated depreciation		(665,138	)		(661,488	)
Total	$	37,939		$	41,589

During the three months ended December 31, 2024 and 2023, the Company recorded $3,650 of depreciation expense.

8. Related Party Loans:

Related party loans (the “Related Party Loans”) consisted of the following at December 31, 2024 and September 30, 2024:

	December 31, 2024		September 30, 2024
Passing Through, LLC	$	581,249	$	581,249
Conch and Shell Holdings, Inc.		247,775		248,275
J. Toomey and L. Toomey		333,147		333,147
K. Toomey		35,000		35,000
J. Toomey		180,000		180,000
Total	$	1,377,171	$	1,377,671
Total current	$	1,377,171		-
Total long term	$	-	$	1,377,671

The Company entered into a note with Passing Through, LLC, for $600,000 effective July 1, 2016. The note bears interest, commencing on the date of the loan, at an initial rate of 5% per annum. The maturity date of the note will accelerate and be due and payable immediately upon any change of control, merger, or other business combination (as defined in the note). If the maturity date is extended for any reason whatsoever (including in connection with an acceleration event), the note will bear interest at a rate of 5% per annum, commencing on the date of any such extension. On October 28, 2022, the note was modified and the maturity date was extended to December 31, 2023. On December 31, 2023, the note was extended to December 31, 2024. On December 31, 2024, the note was extended to December 31, 2025. During the three months ended December 31, 2024 and 2023, the Company recorded $7,325 and $9,568 in interest expense. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $261,083 and $253,760, respectively.

The Company entered into a note with Conch And Shell Holdings, Inc, for $250,000 effective November 20, 2018. The note bears interest, commencing on the date of the loan, at an initial rate of 8% per annum. The maturity date of the note will accelerate and be due and payable immediately upon any change of control, merger, or other business combination (as defined in the note). If the maturity date is extended for any reason whatsoever (including in connection with an acceleration event), the note will bear interest at a rate of 8% per annum, commencing on the date of any such extension. On October 28, 2022, the note was modified and the maturity date was extended to December 31, 2023. Interest as of December 31, 2023 in the amount of $121,666 was paid during December 2023. On December 31, 2023, the note was extended to December 31, 2024. On December 31, 2024, the note was extended to December 31, 2025. During the three months ended December 31, 2024 and 2023, the Company recorded $5,006 and $5,000 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $19,909 and $14,903, respectively.

Table of Contents

The Company entered into a note with James K. and Lori M. Toomey, directors, for $365,000 effective November 18, 2018. The note bears interest, commencing on the date of the loan, at an initial rate of 5% per annum. The maturity date of the note will accelerate and be due and payable immediately upon any change of control, merger, or other business combination (as defined in the note). If the maturity date is extended for any reason whatsoever (including in connection with an acceleration event), the note will bear interest at a rate of 5% per annum, commencing on the date of any such extension. On October 28, 2022, the note was modified and the maturity date was extended to December 31, 2023. Interest as of December 31, 2023 in the amount of $103,045 was paid during December 2023. On December 31, 2023, the note was extended to December 31, 2024. On December 31, 2024, the note was extended to December 31, 2025. During the three months ended December 31, 2024 and 2023, the Company recorded $4,199 and $4,067, in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $16,823 and $12,624, respectively.

The Company entered into a note with K. Toomey, directors, for $35,000 effective November 18, 2018. The note bears interest, commencing on the date of the loan, at an initial rate of 5% per annum. The maturity date of the note will accelerate and be due and payable immediately upon any change of control, merger, or other business combination (as defined in the note). If the maturity date is extended for any reason whatsoever (including in connection with an acceleration event), the note will bear interest at a rate of 5% per annum, commencing on the date of any such extension. On October 28, 2022, the note was modified and the maturity date was extended to December 31, 2023. Interest as of December 31, 2023 in the amount of $103,045 was paid during December 2023. On December 31, 2023, the note was extended to December 31, 2024. On December 31, 2024, the note was extended to December 31, 2025. During the three months ended December 31, 2024 and 2023, the Company recorded $441 and $438 in accrued interest, respectively. As of December 31, 2024 and September 30, 2024, the balance of interest expense was $1,757 and $1,316, respectively.

The Company entered into a note to convert prior advances in a note payable with Mr. Toomey, a director, for $130,000 effective February 1, 2021 (the “2021 Promissory Note”). The 2021 Promissory Note bears interest, commencing on the date of the loan, at an initial rate of 2% per annum and the note matures on March 31, 2024. The maturity date of the note will accelerate and be due and payable immediately upon any change of control, merger, or other business combination (as defined in the note). If the maturity date is extended for any reason whatsoever (including in connection with an acceleration event), the note will bear interest at a rate of 5% per annum, commencing on the date of any such extension. On December 31, 2024, Mr. Toomey and the Company entered into Amendment to the 2021 Promissory Note to extend the maturity date of the 2021 Promissory Note to December 31, 2025. During the three months ended December 31, 2024 and 2023, the Company recorded $655 and $0 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $10,180 and $9,524., respectively.

The Company entered into a note with Mr. Toomey, a director, for $50,000 effective March 7, 2022 (the “2022 Promissory Note”). The note bears interest, commencing on the date of the loan, at an initial rate of 2% per annum and the note matures on December 31, 2024. The maturity date of the note will accelerate and be due and payable immediately upon any change of control, merger, or other business combination (as defined in the note). If the maturity date is extended for any reason whatsoever (including in connection with an acceleration event), the note will bear interest at a rate of 5% per annum, commencing on the date of any such extension. On December 31, 2024, Mr. Toomey and the Company entered into an Amendment to the 2021 Promissory Note to extend the maturity date of the 2022 Promissory Note to December 31, 2025. During the three months ended December 31, 2024 and 2023, the Company recorded $252 and $0 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $2,822 and $2,570, respectively.

Table of Contents

Certain of the Related Party Loans including the Company Security (as defined below), are subordinated to a loan between 6 LLC and Hancock Whitney Bank (the “Bank Loan”). The Related Party Loans are secured by all of the assets of the Company and certain of the Related Party Loans are secured by all of the assets of 6 LLC (the “6 LLC Security”). In addition, 6 LLC’s primary source of funds included loans made to 6 LLC by related parties and their affiliated entities (such loans collectively comprise the “6 LLC Affiliate Debt”). The 6 LLC Affiliate Debt, including the 6 LLC Security, is subordinated to the Bank Loan. The 6 LLC Affiliate Debt is secured by all of the assets of 6 LLC, and certain of the 6 LLC Affiliate Debt is secured by the assets of the Company (the “Company Security”).

Both the 6 LLC Affiliate Debt, and the Company Security thereof, and the Company Affiliate Debt, and the 6 LLC Security thereof are subordinated to the Bank Loan which has a senior secured security interest in all of the assets of the Company and 6 LLC. Although the Bank Loan is by and between Hancock Whitney Bank and 6 LLC, all of the assets of the Company and all of the assets of 6 LLC, including the property on which the Company conducts business, are used to secure the Bank Loan. As a result, Lori Toomey (a director of the Company) has pledged her personal trust as additional collateral as security for the Bank Loan and she is required to maintain $1 million of liquid assets in her trust. The outstanding amount owed under the Bank Loan as of December 31, 2024 was approximately $1,749,078. Interest accrues on the Bank Loan at an annual rate of 7.36% and is currently being extended on a month-to-month basis pending discussions surrounding an extension of the Bank Loan. The Bank Loan has been on a year-to-year basis since 2019 and the parties historically have extended the Bank Loan and have entered into new loan agreements each year. However, there is no agreement to extend the Bank Loan each year and, as a result, there is a risk that the Bank Loan will not be extended beyond the current maturity date and, if it is extended, that the terms of such Bank Loan may be on terms more disadvantageous as those currently in place (i.e., higher interest rates to reflect current market conditions).

In the event that the Bank Loan is not extended or is otherwise terminated prematurely, and 6 LLC is unable to pay the outstanding balance of the Bank Loan, the Company may be required to fulfil its obligations as a guarantor of the Bank Loan and repay the remaining outstanding balance of the Bank Loan, which may require the Company to sell its assets, seek equity investments, or replacement debt in order to raise sufficient capital. There is no assurance that the Company will be able to secure the necessary financing or funds to repay the Bank Loan or obtain such funds on favorable terms. If the Company is required to fulfil its obligations as a guarantor and is unable to secure the funds necessary to repay the Bank Loan, it may be difficult for us to continue our operations and if we do secure such funds, the terms thereof may be disadvantageous and have a significant negative impact on the Company’s financial position.

The above transactions and amounts are not necessarily what third parties would have agreed to.

9. Convertible Notes Payable to Related Party:

The Company entered into a convertible note with a director for $20,000 effective December 7, 2015. The note bears interest at a rate of 3.5% per annum and all unpaid principal and interest are due on demand by the director. The outstanding principal balance of the note is convertible into the Company’s shares of common stock at the conversion price of $1.00 per share. During the three months ended December 31, 2024 and 2023, the Company recorded $176 and $0 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $6,352 and $6,175, respectively.

The Company entered into a convertible note with a director for $20,000 effective March 3, 2016. The note bears interest at a rate of 3.5% per annum and all unpaid principal and interest are due on demand by the director. The outstanding principal balance of the note is convertible into the Company’s shares of common stock at the conversion price of $1.00 per share. During the three months ended December 31, 2024 and 2023, the Company recorded $176 and $0 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $6,179 and $6,003, respectively.

Table of Contents

The Company entered into a convertible note with a director for $30,000 effective July 11, 2016. The note bears interest at a rate of 3.5% per annum and all unpaid principal and interest are due on demand by the director. The outstanding principal balance of the note is convertible into the Company’s shares of common stock at the conversion price of $1.00 per share. During the three months ended December 31, 2024 and 2023, the Company recorded $265 and $0 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $8,903 and $8,639, respectively.

The Company entered into a convertible note with a director for $20,000 effective September 19, 2016. The note bears interest at a rate of 3.5% per annum and all unpaid principal and interest are due on demand by the director. The outstanding principal balance of the note is convertible into the Company’s shares of common stock at the conversion price of $1.00 per share. During the three months ended December 31, 2024 and 2023, the Company recorded $176 and $0 in interest expense, respectively. As of December 31, 2024 and September 30, 2024, the balance of accrued interest was $5,801 and $5,625, respectively.

The above transactions and amounts are not necessarily what third parties would have agreed to.

10. Line of Credit:

On October 21, 2024, the Company entered into a credit agreement with Conch and Shell Holdings, Inc., a Florida corporation (“CAS”), with a line of credit in the aggregate amount of $200,000 (the “CAS Credit Agreement”) and a credit agreement with 6 LLC, a Florida limited liability company (“6 LLC”), with a line of credit in the aggregate amount of $100,000 (the “6 LLC Credit Agreement” and together with the CAS Credit Agreement, the “Credit Agreements”).

As described elsewhere in this Interim Report, certain directors of the Company own shares in CAS and control 6 LLC. James K. Toomey and Lori M. Toomey, directors of the Company (together the “Toomey Directors”) own shares in CAS. The shareholders who received shares in connection with the merger of Renovo Resource Solutions, Inc. with and into the Company, which includes, among others, Randall M. Moritz, director, Keri A. Moritz, director, and the Toomey Directors, also are controlling equity holders of 6 LLC.

On October 21, 2024, the Company drew $100,000 of the $200,000 available under the CAS Agreement and on October 22, 2024, the Company drew the remaining $100,000 available under the CAS Agreement. On October 23, 2024 the Company drew $100,000 (the full amount available) under the 6 LLC Credit Agreement. Amounts drawn under the Credit Agreements was used to purchase additional inventory created by Hurricane Milton.

The CAS Credit Agreement does not bear any interest expense, but rather provides for a flat fee payment of $500 to CAS, regardless of the amount drawn under such agreement. The CAS Credit Agreement matures on December 20, 2024 and must be repaid in full on that date. Amounts due under the CAS Credit Agreement may be accelerated and be due and payable at CAS’ option immediately upon any incurrence of additional indebtedness or the occurrence of any merger, consolidation, sale of assets, and other customary events of default as set forth in the CAS Credit Agreement. If any Event of Default (as defined in the CAS Credit Agreement) exists and is continuing, amounts borrowed pursuant to the CAS Credit Agreement will then bear interest at a rate of 10% per annum.

The 6 LLC Credit Agreement also does not bear any interest expense, but rather provides for a flat fee payment of $250 to 6 LLC, regardless of the amount drawn under such agreement. The 6 LLC Credit Agreement matures on December 20, 2024, and must be repaid in full on that date. Amounts due under the 6 LLC Credit Agreement may be accelerated and be due and payable at 6 LLC’s option immediately upon any incurrence of additional indebtedness or the occurrence of any merger, consolidation, sale of assets, and other customary events of default as set forth in the 6 LLC Credit Agreement. If any Event of Default (as defined in the 6 LLC Credit Agreement) exists and is continuing, amounts borrowed pursuant to the 6 LLC Credit Agreement will then bear interest at a rate of 10% per annum.

Table of Contents

Under the terms of both the CAS Credit Agreement the 6 LLC Agreement, the Company must first draw down all funds available under the CAS Agreement before any amounts may be drawn under the 6 LLC Credit Agreement.

On December 16, 2024, the Company repaid all amounts due pursuant to the CAS Credit Agreement and the 6 LLC Credit Agreement.

11. Preferred Stock:

The Company is authorized to issue up to 2,000,000 shares of Preferred Stock with designations, rights and preferences determined from time to time by our Board of Directors. Accordingly, our Board of Directors is empowered, without shareholder approval, to issue Preferred Stock with dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of our Common Stock. The terms of the preferred stock have not been approved. As of December 31, 2024 and September 30, 2024, there was no Preferred Stock issued and outstanding.

12. Income Taxes:

The Company's expenses (benefit) for income taxes consist of:

	For the three months ended
	December 31, 2024		December 31, 2023
Current
Federal	$	36,251	$	(45,597	)
State		6,819		(8,577	)
Foreign		-		-
		43,070		(54,174	)
Deferred
Federal		19,147		44,420
State		3,601		8,355
		22,748		52,775
Total	$	65,818	$	(1,399	)

The components of the net deferred tax asset at December 31, 2024 and September 30, 2024 consist of:

	December 31, 2024			September 30, 2024

Accounts receivable	$	(22,016	)	$	(18,349	)
Accounts payable		7,554			31,294
Accrued interest payable		84,782			80,124
Net operating loss		-			27,405
Total	$	70,320		$	120,474

Table of Contents

The following is a reconciliation of the applicable federal income tax as computed at the federal statutory tax rate to the actual income taxes reflected in the Consolidated Statements of Operations for the three months ended December 31, 2024 and 2023.

	Three months ended December 31,
	2024			2023

Tax provision at U.S. federal income tax rate		21	%		21	%
State income tax provision net of federal		4	%		4	%

Valuation allowance		(0	)%		(0	)%

Provision for income taxes		25	%		25	%

The Company’s earliest tax year that remains subject to examination by all tax jurisdictions was September 30, 2017.

13. Commitments and Contingencies:

During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450-20-50, “Contingencies”. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of December 31, 2024 and September 30, 2024, the Company is not aware of any contingent liabilities that should be reflected in the financial statements.

Purchase Option Agreement

In connection with the closing of the Merger (See Note 3), the Company entered into the Purchase Option Agreement (the “Purchase Option Agreement”) on the Closing Date with 6 LLC, which is solely held by the Renovo Owners prior to the Merger, pursuant to which, the Company will have the exclusive option, subject to certain conditions, in its sole discretion, exercisable at any time within five (5) years after the Closing Date, to acquire 6 LLC in a post-Merger transaction (the “Future Acquisition”) at a purchase price equal to (i) the fair market value of 6 LLC, as determined in accordance with the terms of the Purchase Option Agreement (“Fair Market Value”) plus (ii) a premium equal to fifteen percent (15%) of the Fair Market Value. It is a condition to the exercise of the Purchase Option that the Company either repay the Bank Loan or negotiate the assumption of the Bank Loan by the Company at the closing of the Future Acquisition. Currently, the Company is a guarantor under the Bank Loan.

The Fair Market Value will be determined by an independent appraisal of the fair market value of the 6 LLC assets (or, upon a bona fide offer with a firm price made by an unaffiliated third party within 12 months of an exercise of the Purchase Option by the Company).

Under the terms of the Purchase Option Agreement, the Company has the option to structure the Future Acquisition in any of the following structures:

	·	a purchase in cash by the Company or any wholly owned subsidiary of the Company of all of the outstanding equity interests of 6 LLC (“6 LLC Equity Interests”) from the owners of the 6 LLC Equity interests (the “6 LLC Owners”), including, without limitation, all units of membership interest, directly from all of the 6 LLC Owners;

	·	an exchange transaction by the Company or any wholly owned subsidiary of Company to the 6 LLC Owners whereby all of the outstanding 6 LLC Equity Interests will be exchanged for shares of Common Stock or a combination of cash and Common Stock;

	·	engage in a merger transaction by and between the 6 LLC and the Company or any wholly owned subsidiary of the Company (with the surviving subsidiary entity to be determined by Company) whereby 6 LLC Owners will receive their prorated share of the aggregate Purchase Price from the payment of the merger consideration, which merger consideration shall be payable in cash or shares of Common Stock, as determined by the Company; or

	·	a purchase by the Company or any wholly owned subsidiary of the Company of all or substantially all of the assets of 6 LLC, which Purchase Price shall be payable in cash or shares of Common Stock, as determined by the Surviving Corporation.

Table of Contents

To the extent that any portion of the Bank Loan remains outstanding at the time of the Future Acquisition, either (i) the cash portion of the Purchase Price would be used to first payoff any such amount, or (ii) if the Company negotiates the assumption of the Bank Loan with the Bank, the dollar amount of the outstanding Bank Loan so assumed shall be applied to the payment of the Purchase Price. In each case, remaining Purchase Price proceeds (“Remaining Proceeds”) would be paid to the 6 LLC debt holders and then to the 6 LLC Owners or 6 LLC, depending on the structure of the transaction.

In the event that the Company should determine to use an acquisition structure whereby it will pay the Remaining Proceeds in Common Stock, the value of the Common Stock will be the average of the last daily sales price of Common Stock as reported by the OTC Markets (otcmarkets.com), or if not reported thereby, another authoritative source selected by the Company) for the ten (10) consecutive full trading days in which such shares are traded ending at the close of trading on the fifth business day preceding the Future Acquisition closing.

The Purchase Option Agreement contains customary representations, warranties and covenants made by 6 LLC, including, among other things, covenants (i) to conduct its business in the ordinary course consistent with past practice during the option period and consummation of a Future Acquisition transaction; (ii) not to engage in certain kinds of transactions during such period; (iii) not to amend or propose to amend any of its organizational documents; (iv) not to incur any additional debt obligations and (v) not to enter into, amend or modify any material contract. The Purchase Option Agreement also is subject to a number of customary closing conditions.

14. Recent Accounting Pronouncements:

In November 2023, the FASB issued ASU 2023-07, *Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures*, enhancing segment expense transparency. The update requires public entities to disclose significant segment expenses regularly provided to the chief operating decision maker and extends certain annual segment disclosures to interim periods. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, with interim period application required starting after December 15, 2024, and early adoption permitted. The Company has adopted this new standard in the current fiscal year.

15. Subsequent Events:

In accordance with ASC 855, Subsequent Events, the Company evaluated subsequent events through the date of this report; the date the consolidated financial statements were available for issue.

Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses the operating results and financial condition of the Company for the fiscal quarters ended December 31, 2024 and 2023. The discussion and analysis set forth below is intended to assist you in understanding the financial condition and results of our operations and should be read in conjunction with our financial statements and the accompanying notes included elsewhere in this quarterly report. Our results of operations and financial condition, as reflected in the accompanying statements and related notes, are subject to management’s evaluation and interpretations of business conditions, changing market conditions and other factors. Historical results and trends which might appear should not be taken as indicative of future operations.

A NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (including the exhibits hereto) contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), such as statements relating to our financial condition, results of operations, plans, objectives, future performance or expectations, and business operations. These statements relate to expectations concerning matters that are not historical fact. Accordingly, statements that are based on management’s projections, estimates, assumptions, and judgments constitute forward-looking statements. These forward-looking statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “plan,” “estimate,” “approximately,” “intend,” “objective,” “goal,” “project,” and other similar words and expressions, or future or conditional verbs such as “will,” “should,” “would,” “could,” and “may.” These forward-looking statements are based largely on information currently available to our management and on our current expectations, assumptions, plans, estimates, judgments and projections about our business and our industry, and such statements involve inherent risks and uncertainties. Although we believe our expectations are based on reasonable estimates and assumptions, they are not guarantees of performance and there are a number of known and unknown risks, uncertainties, contingencies, and other factors (many of which are outside our control) which may cause actual results, performance, or achievements to differ materially from those expressed or implied by such forward-looking statements. Accordingly, there is no assurance that our expectations will in fact occur or that our estimates or assumptions will be correct, and we caution investors and all others not to place undue reliance on such forward-looking statements.

The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements:

	·	the Company’s ability to generate sufficient cash proceeds from its operations or, alternatively, identify, secure and obtain suitable and sufficient financing to continue as a going concern and execute its business plan;

	·	general economic, political and market conditions;

	·	interest rate and inflation risk;

	·	climate related or natural disaster-related events that increases the likelihood of catastrophic losses, disruption to our operations, and related cost of insurance coverage for entities with operations in high fire, hurricane or flood risk areas, including the Company’s operations which are located on the gulf coast of central Florida, a region which is susceptible to hurricanes;

	·	government and industry regulation that might affect future operations;

	·	potential change of control transactions resulting from any potential future merger, acquisition, or combination with another entity;

Table of Contents

	·	the potential dilution in our equity (both economically and in voting power) that might result from future financing or from merger, acquisition, or combination activities;

	·	the Company’s ability to successfully integrate the operations of Renovo (as defined below) into the Company following the Merger (as defined below), and to operate profitably following such Merger;

	·	the Company’s ability to service its outstanding debt obligations and to continue to successfully negotiate economically beneficial annual extensions of its guarantor obligations to 6 LLC’s loan with Hancock Whitney Bank (as described below);

	·	the Company’s expectations regarding the anticipated benefits of the Merger and the ability of the Company to achieve the anticipated potential benefits from the Merger, including statements of the plans, strategies and objectives of management with respect to operations of the Company following the Merger;

	·	any statements regarding future economic conditions, growth rate, market opportunity or performance of the Company following the Merger;

	·	economic, business, competitive, and/or regulatory factors affecting the business of the Company following the Merger;

	·	the ability of the Company to obtain and maintain all licenses necessary to operate its business; and

	·	statements of belief and any statement of assumptions underlying any of the foregoing.

If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, the results of the Company or the combined company following completion of the Merger could differ materially from the forward-looking statements. All written or oral forward-looking statements that are made or attributable to us are expressly qualified in their entirety by this cautionary notice. The forward-looking statements included herein are only made as of the date of this Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2024 (this “Form 10-Q”). We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

Explanatory Note

On April 19, 2024, the Company consummated a merger of Renovo Resource Solutions, Inc. (“Renovo”) with and into the Company (“Merger”), with the Company as the legal surviving entity and Renovo as the accounting surviving entity. For purposes of this Management’s Discussion and Analysis of Financial Condition and Results of Operations, the historic results of the Company are those of Renovo as the accounting survivor of the Merger.

Operations

The Company’s business currently consists solely of acquiring salvage and reselling scrap metals processed and unprocessed ferrous and nonferrous metals from a variety of sources including, manufacturing and industrial plants, metal fabrication plants, electric utilities, machine shops, factories, refineries, demolition businesses, wrecking companies, contractors, and retail individuals. Ferrous metals are those containing significant quantities of iron or steel. Non-ferrous metals, which do not contain significant quantities of iron or steel include, without limitation, copper, brass, aluminum, bronze, lead, zinc, nickel, and alloys thereof; but do not include precious metals (such as gold, silver, and platinum).

The primary business operations of the Company consist of accepting metals contained in radiators, insulated aluminum wire, automotive components (rotors, drums etc.), insulated copper wire, electric motors, stainless steel, scrap iron, appliances, aluminum cans, batteries (lead acid), and e-scrap. The Company utilizes specialized equipment to efficiently process significant volumes of insulated copper wire through granulation. With the exception of precious metals, our scrap metal processing facility processes almost all other types of metal.

Table of Contents

The Company derives profit from aggregating more than 60 product types and reselling the materials to larger transfer and processing partners in the state of Florida. The Company has operated under the guidelines of selling “mixed” truckloads of material as soon as they are aggregated in an effort to abate any changes in commodity pricing that may affect its margins in a negative manner. This buy/sell formula has preserved margins in the past but also curtails the Company’s ability to ship directly to non-ferrous mills due to smaller volumes of like materials or Full Truck Load (“FTL”) volumes resulting in lower prices received for materials.

Although the Company does have the capacity and volume to achieve FTL loads required by non-ferrous mills, based on market price fluctuations, the Company has taken a more conservative approach to approach to protect its margins. Accordingly, the Company only ships less than a truckload (or “LTL”) of mixed commodities to go to multiple end users in an effort to mitigate any potential losses due to market fluctuations.

On September 26, 2024, Hurricane Helene made landfall as a category 4 hurricane near Perry, Florida. Subsequently, on October 9, 2024, Hurricane Milton made landfall as a category 3 hurricane near Sarasota, Florida. Both Hurricane Helene and Hurricane Milton had a significant impact through wind damage and flooding on the area in which the Company conducts business. Following the impacts of Hurricanes Helene and Milton the Company experienced a significant influx of inventory available for purchase from the public at advantageous prices. In addition, certain of the Company’s competitors were temporarily unable to continue operations due to impacts from the hurricanes. In order to capitalize on this opportunity, the Company obtained temporary financing to make inventory purchases as is described below, which loans were fully repaid on December 16, 2024. The Company expects that the effects of Hurricanes Helene and Milton will subside during the first quarter of its next fiscal year, although some elevated inventory levels may remain available for purchase.

The Company does not engage in the business of fabricating or otherwise converting raw materials into products or prepared grades of materials having an existing or potential economic value.

Balance Sheet

At December 31, 2024 and September 30, 2024, the Company had total assets of $2,540,233 and $2,512,968, respectively, total liabilities of $2,453,887 and $2,624,603, respectively, and total stockholders’ equity (deficit) of $86,346 and $(111,635), respectively. The increase of total assets of $27,265 of total assets from September 30, 2024 to December 31, 2024 was due primarily to an increase in inventory. In October 2024, Hurricane Milton made landfall on the Suncoast of Florida. Storm damage represented a sudden increase in material purchases specifically in Aluminum products, which is not typical or anticipated. Additionally, the Company’s competitors reached capacity and terminated all purchases for 30 days and this offered the Company a unique opportunity to capitalize on material purchases with little to no competition. Inventory was accumulated short term as offload agreements were finalized. The decrease of total liabilities of $170,716 from September 30, 2024 to December 31, 2024 was due primarily to extinguishment of old accounts payable balances.

At September 30, 2024, the Company had an accumulated deficit of $111,719. As December 31, 2024, the Company had retained earnings of $86,346. The change from an accumulated deficit to retained earnings was a result of our net income for the three months ended December 31, 2024 in the amount of $197,981.

Results of Operations

Comparison of Three Months Ended December 31, 2024 and 2023

Revenues

For the three months ended December 31, 2024 and 2023, the Company had total revenues of $1,536,631 and $822,579, respectively, and gross profits of $549,419 and $293,483, respectively. The primary driver of the Company’s revenues are steel prices and the prices of other metal commodities. When metal prices are higher, revenues increase assuming that volume is stable. The Company is primarily impacted by the price of steel, with the price of copper and the price of other metals also significantly contributing to the Company’s revenues and profits. The primary reason for the increase in our revenues was due to the increase in the volume of the Company’s of sales in the three months ended December 31, 2024 when compared to the three months ended December 31, 2023. The increased volume of sales in the current period was primarily the result of decreases in commodity prices combined with stable material volume as well as a sudden increase in material purchases specifically in aluminum products as result of Hurricane Milton.

Table of Contents

Cost of goods sold for the three months ended December 31, 2024 and 2023 were $987,212 and $529,096, respectively, resulting in a gross margin of 36% and 36%, respectively. Cost of goods sold consists primary of costs associated with purchasing salvage and scrap metal and increases as prices for these commodities fluctuate. The Company was able to purchase a significant volume of aluminum as a result of Hurricane Milton. As a result, buyers became aggressive in their price offerings to receive material once the bidding price resumed. As a result, the gross margin increased significantly over the period.

Operating Expenses.

The Company’s operating expenses increased from $283,007 for the three months ended December 31, 2023 to $362,098 for the three months ended December 31, 2024 due primarily to an increase in professional fees related to increased audit expenses.

Other Income (Expenses).

Other income (expenses) decreased from $(16,081) for the three months ended December 31, 2023 to $76,478 for the three months ended December 31, 2024 primarily due to the Company recording gain on extinguishment of accounts payable in the amount of $95,150.

Net Income (Loss)

We had net income of $197,981 for the three months ended December 31, 2024, compared to a net loss of $(4,206) for the three months ended December 31, 2023. The net income in the current period was primarily the result of a 87% increase in sales in the current period due to aggressive bidding by buyers as a result of increased aluminum as a result of Hurricane Milton.

Liquidity and Capital Resources

At December 31, 2024 and September 30, 2024, our current liabilities were $2,374,152 and $2,427,235, respectively.

The Company’s principal sources of funds are funds generated by its operations, as well as amounts received from affiliated loans. Such affiliated loans include both those entered into by the Company prior to the Merger and those entered into by Renovo prior to the Merger.

The consolidated financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The principal conditions or events that raised doubt about the Company's ability to continue as a going concern is negative working capital and prior period net loss. In the current period, the Company had net income, net income from operations, and positive cash flows from operations. Based on evaluation of the conditions above, and mitigating factors, management has determined the risk of going concern to be alleviated.

The Company’s ability to finance its working capital requirements and sustain current levels of operations, and to service or retire its outstanding debt obligation, as well as its ability to exercise its Purchase Option (described below), is dependent upon management’s ability to continue to curtail current operating expense and obtain additional financing to augment working capital requirements and support acquisition plans. In order to service or retire such loans and to exercise the Purchase Option, the Company is evaluating possible equity financings. However, the Company has not yet determined whether to pursue an equity financing at this time and there is no assurance that an equity financing will be attempted by the Company, or, in the event that the Company does pursue an equity financing, that such financing would be successful or on terms reasonably satisfactory to the Company.

Table of Contents

In connection with the closing on the Merger, the Company entered into a lease agreement with 6 LLC, a Florida limited liability company (“6 LLC”) on April 19, 2024. Under the terms of the Lease the Company is leasing the buildings and property (“Property”) on which the Company conducts its operations from 6 LLC for annual rent of $480,000 paid in twelve (12) monthly payments of $40,000, which is inclusive of electrical, water, sewer, and other utilities. The Lease has an initial term of two years, and may be extended for a period of up to five (5) additional years by the Company. In addition to the Lease, the Company also has entered into a Purchase Option Agreement with the equity owners of 6 LLC(“Purchase Option Agreement”) pursuant to which the Company has the exclusive option, subject to certain conditions, in its sole discretion, exercisable at any time within five (5) years after the closing of the Merger to acquire 6 LLC and, as a result thereof, the Property (the “Purchase Option”). The terms of the Lease include customary terms regarding alterations to the Property, maintenance by 6 LLC, insurance, and indemnification and generally reflect terms that would be typically negotiated in an at arm’s-length transaction with modifications to the termination provisions of the Lease to limit 6 LLC’s ability to terminate the Lease in light of the Purchase Option Agreement. Further, the Lease limits 6 LLC’s ability to assign the Lease, while preserving the right of the Company to assign the Lease under certain circumstances. The Company has not yet determined whether it will exercise the Purchase Option. For more information relating to the Purchase Option Agreement and the Purchase Option, see Financial Statement Note 13.

In addition, the Company has paid operational expenses and debt on behalf of 6 LLC. As of December 31, 2024 and September 30, 2024, the total paid on behalf of 6 LLC and payable to the Company is $1,009,580. These advances bear no interest, are uncollateralized and have no specific due date.

Cash Flow

The following table provides detailed information about our net cash flow for the three months ended December 31, 2024 and 2023:

	Three months ended December 31,
	2024			2023
Net cash provided by (used in) operating activities	$	134,689		$	(174,669	)
Net cash used in investing activities		—			—
Net cash used in financing activities		(500	)		(56,522	)
Net change in cash and cash equivalents		134,189			(231,191	)
Cash and cash equivalents at beginning of period		425,706			821,770
Cash and cash equivalent at end of period	$	559,895		$	590,579

Net cash provided by operating activities for the three months ended December 30, 2024 was $134,689 compared to $174,669 used in operating activities for the three months ended December 30, 2023. This difference primarily related to net income in the current period coupled with a gain on extinguishment of accounts payable. During the three months ended December 30, 2024 and 2023, there were no investing activities. During the three months ended December 30, 2024, our financing activities used cash of $500 compared to $56,522 during the three months ended December 30, 2023. The difference primarily related to less related party loan activity in the current period.

Table of Contents

Affiliate Loans.

Prior to the Merger with Renovo, the Company had no operations and generated no revenues. As a result, the Company entered into various lending arrangements with related parties to finance its activities in connection with the preparation of its SEC filings and the negotiation of the Merger transaction. These loans were made to the Company by James K. Toomey. Several of these loans are convertible at the option of Mr. Toomey into shares of the Company’s common stock.

In connection with the Merger, the Company assumed all affiliated loans made to Renovo prior to the Merger, which consisted of loans made to Renovo by James K. Toomey, Lori M. Toomey, and Kristen Toomey, and their affiliated entities, including Conch and Shell Holdings, Inc., AMI Holdings, Inc., and Passing Through, LLC.

Each such affiliated loan made by one or more of James K. Toomey, Lori M. Toomey, and Kristen Toomey, and their affiliated entities, including Conch and Shell Holdings, Inc., AMI Holdings, Inc., and Passing Through, LLC (collectively referred to herein as the “Toomey Debtholders”) to the Company or Renovo prior to the Merger is referred to herein as an “Affiliate Loan” and collectively, such loans, “Company Affiliate Debt.”

The Company Affiliate Debt which was assumed by the Company from Renovo in connection with the Merger, including the Company Security (as defined below), is subordinated to a loan between 6 LLC and Hancock Whitney Bank (the “6 LLC Bank Loan”). The 6 LLC Bank Loan is secured by all of the assets of the Company and is secured by all of the assets of 6 LLC (the “6 LLC Security”). In addition, 6 LLC’s primary source of funds included loans made to 6 LLC by related parties and their affiliated entities (such loans collectively comprise the “6 LLC Affiliate Debt”). The 6 LLC Affiliate Debt, including the 6 LLC Security, is subordinated to the Bank Loan. The 6 LLC Affiliate Debt is secured by all of the assets of 6 LLC, and certain of the 6 LLC Affiliate Debt is secured by the assets of the Company (the “Company Security”).

As of December 31, 2024 the aggregate principal amount of the Company Affiliated Debt was approximately $1,467,171 and the accrued interest thereon was approximately $339,809.

Table of Contents

Set forth below is the outstanding Company Affiliate Debt as of the December 31, 2024.

Affiliate Lender	Date of Original Loan	Principal Amount Borrowed		Annual Interest Rate			Accrued Interest		Maturity Date

James Toomey(1)	December 7, 2015	$	20,000		3.50	%	$	6,352	Convertible(2)
James Toomey(1)	March 3, 2016	$	20,000		3.50	%	$	6,179	Convertible(2)
Passing Through, LLC (Toomey family trust/estate)	July 1, 2016	$	600,000		5.00	%	$	261,084	December 31, 2025
James Toomey(1)	July 11, 2016	$	30,000		3.50	%	$	8,903	Convertible(2)
James Toomey(1)	September 19, 2016	$	20,000		3.50	%	$	5,801	Convertible(2)
Conch and Shell Holdings, Inc.(extended Toomey family)	November 20, 2018	$	250,000		8.00	%	$	19,909	December 31, 2025
James, Lori and Kristen Toomey	November 20, 2018	$	365,000		5.00	%	$	16,823	December 31, 2025
Kristen Toomey	November 20, 2018	$	35,000		5.00	%	$	1,757	December 31, 2025
James Toomey(1)	February 1, 2021	$	130,000		2.00	%	$	10,179	December 31, 2025
James Toomey(1)	March 7, 2022	$	50,000		2.00	%	$	2,822	December 31, 2025

________________

(1)	These notes were entered into by the Company prior to the Merger (and not assumed from Renovo in connection with the Merger) and therefore are not subordinated to the 6 LLC Bank Loan.
(2)	The outstanding principal and accrued interest balance of the convertible notes is convertible into the Company’s shares of common stock at the conversion price of $500.00 per share.

Set forth below is the outstanding 6 LLC Affiliate Debt subject to the Company Security as of December 31, 2024.

Affiliate Lender	Principal Amount Outstanding
James K. Toomey	$	100,000
Lori Toomey	$	300,000
Lori Toomey	$	500,000
James and Lori Toomey	$	50,000
Passing Through, LLC	$	189,545
Passing Through, LLC	$	100,000
Passing Through, LLC	$	100,000
Conch and Shell Holdings, Inc.	$	100,000
Conch and Shell Holdings, Inc.	$	248,725
Lori Toomey, Conch and Shell Holdings, Inc., and AMI Holdings, Inc.	$	225,000

The maturity dates of the 6 LLC Affiliate Debt has been extended to December 31, 2025.

Table of Contents

Both the 6 LLC Affiliate Debt (and the Company Security thereof) and the Company Affiliate Debt (and the 6 LLC Security thereof) are subordinated to the 6 LLC Bank Loan which has a senior secured security interest in all of the assets of the Company and 6 LLC. Although the 6 LLC Bank Loan is by and between Hancock Whitney Bank and 6 LLC, all of the assets of the Company and all of the assets of 6 LLC, including the property on which the Company conducts business, are used to secure the 6 LLC Bank Loan. As a result, Lori Toomey (a director of the Company) has pledged her personal trust as additional collateral as security for the 6 LLC Bank Loan and she is required to maintain $1 million of liquid assets in her trust.

For more information relating to the Company Affiliated Debt and the 6 LLC Debt, please see Notes 8 and 9 to the Financial Statements.

Hancock Whitney Bank Loan

The outstanding amount owed under the 6 LLC Bank Loan as of December 31, 2024 was approximately $1,692,074. Interest accrues on the 6 LLC Bank Loan at an annual rate of 6.735% and it matures on November 13,2025. The 6 LLC Bank Loan has been on a year-to-year basis since 2019 and the parties historically have extended the 6 LLC Bank Loan and have entered into new loan agreements each year. However, there is no agreement to extend the 6 LLC Bank Loan each year and, as a result, there is a risk that the 6 LLC Bank Loan will not be extended beyond the current maturity date and, if it is extended, that the terms of such 6 LLC Bank Loan may be on terms more disadvantageous as those currently in place (i.e., higher interest rates to reflect current market conditions).

In the event that the 6 LLC Bank Loan is not extended or is otherwise terminated prematurely, and 6 LLC is unable to pay the outstanding balance of the 6 LLC Bank Loan, the Company may be required fulfil its obligations as a guarantor of the 6 LLC Bank Loan and repay the remaining outstanding balance of the 6 LLC Bank Loan, which may require the Company to sell its assets, seek equity investments, or replacement debt in order to raise sufficient capital. There is no assurance that the Company will be able to secure the necessary financing or funds to repay the 6 LLC Bank Loan or obtain such funds on favorable terms. If the Company is required to fulfil its obligations as a guarantor and is unable to secure the funds necessary to repay the 6 LLC Bank Loan, it may be difficult for us to continue our operations and if we do secure such funds, the terms thereof may be disadvantageous and have a significant negative impact on the Company’s financial position.

Special Short-Term Loans for Inventory Purchases.

Following Hurricanes Helene on September 26, 2024 and Milton on October 9, 2024, the Company had an opportunity to purchase additional inventory from the public at advantageous prices. In order to obtain sufficient cash in order to fully take advantage of this opportunity, which was expected to be available for only for a relatively short period of time, the Company entered into a credit agreement with Conch and Shell Holdings, Inc., a Florida corporation (“CAS”), with a line of credit in the aggregate amount of $200,000 (the “CAS Credit Agreement”) and a credit agreement with 6 LLC, with a line of credit in the aggregate amount of $100,000 (the “6 LLC Credit Agreement” and together with the CAS Credit Agreement, the “Credit Agreements”).

James K. Toomey and Lori M. Toomey, directors of the Company (together the “Toomey Directors”) own shares in CAS. The Renovo Owners who received Merger Shares in connection with the Merger, which includes, among others, Randall M. Moritz, director, Keri A. Moritz, director, and the Toomey Directors, also are controlling equity holders of 6 LLC.

The CAS Credit Agreement did not bear any interest expense, but rather provided for a flat fee payment of $500 to CAS, regardless of the amount drawn under such agreement. Under its terms, the CAS Credit Agreement was set to mature on December 20, 2024 and was required to be repaid in full on that date. Amounts due under the CAS Credit Agreement were permitted to be accelerated and be due and payable at CAS’ option immediately upon any incurrence of additional indebtedness or the occurrence of any merger, consolidation, sale of assets, and other customary events of default as set forth in the CAS Credit Agreement. If any Event of Default (as defined in the CAS Credit Agreement) exists and is continuing, amounts borrowed pursuant to the CAS Credit Agreement will then bear interest at a rate of 10% per annum.

Table of Contents

The 6 LLC Credit Agreement also did not bear any interest expense, but rather provided for a flat fee payment of $250 to 6 LLC, regardless of the amount drawn under such agreement. The 6 LLC Credit Agreement was set to mature on December 20, 2024, and was required to be repaid in full on that date. Amounts due under the 6 LLC Credit Agreement were permitted to be accelerated and be due and payable at 6 LLC’s option immediately upon any incurrence of additional indebtedness or the occurrence of any merger, consolidation, sale of assets, and other customary events of default as set forth in the 6 LLC Credit Agreement. If any Event of Default (as defined in the 6 LLC Credit Agreement) exists and is continuing, amounts borrowed pursuant to the 6 LLC Credit Agreement will then bear interest at a rate of 10% per annum. Under the terms of both the CAS Credit Agreement the 6 LLC Agreement, the Company must first draw down all funds available under the CAS Agreement before any amounts may be drawn under the 6 LLC Credit Agreement.

On December 16, 2024, the Company repaid all amounts due pursuant to the CAS Credit Agreement and the 6 LLC Credit Agreement.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “Smaller Reporting Company”, the Company is not required to provide the information required by this Item

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedure

Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in reports filed under the Exchange Act is accumulated and communicated to management, including the principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our management evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 15d-15(e) under the Exchange Act) as of the end of the period covered by this annual report. Based upon that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that, as of the end of such period, our disclosure controls and procedures were not effective as of December 31, 2024 due to material weakness in our internal control over financial reporting in providing reasonable assurance in timely alerting management to material information relating to the Company and that information required to be disclosed in our reports is recorded, processed, summarized, and reported as required to be included in our periodic filings with the Commission.

The Company is currently evaluating a number of steps to enhance our disclosure controls and procedures, as well as our internal control over financial reporting, and address these material weaknesses, including: appointing specific financial reporting personnel with technical accounting and financial reporting experience, adopting policies to ensure proper internal communications and review in connection with non-routine transactions, enhancing our internal review procedures during the financial statement closing process, and designing and implementing journal entry procedures and controls. Following the completion of the Merger, the Company contracted with a financial consultant and is continuing to evaluate additional steps to enhance its disclosure controls and procedures including evaluating whether to retain additional consultants. Despite the existence of these material weaknesses, the Company believes the financial information presented herein is materially correct and in accordance with generally accepted accounting principles in the United States.

Changes in Internal Control over Financial Reporting

There were no significant changes in our internal controls or in other factors that could significantly affect our disclosure controls and procedures subsequent to the date of the above referenced evaluation. Furthermore, there was no change in our internal control over financial reporting or in other factors during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are presently no pending legal proceedings to which the Company, any of its subsidiaries, any executive officer, any owner of record or beneficially of more than five percent of any class of voting securities is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

ITEM 1A. RISK FACTORS

As a “Smaller Reporting Company”, the Company is not required to provide the information required by this Item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not Applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

(a) None.

(b) None

Table of Contents

ITEM 6. EXHIBITS

31.1			Certification of the Company’s Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 15d-14(a)), with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2024. *

31.2			Certification of the Company’s Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 15d-14(a)), with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2024. *

32.1			Certificate of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted under Section 906 of the Sarbanes-Oxley Act of 2002 (Rule 15d-14(b)). *

32.2			Certificate of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted under Section 906 of the Sarbanes-Oxley Act of 2002 (Rule 15d-14(b)). *

101.INS			XBRL Instance Document.*

101.SCH			XBRL Taxonomy Extension Schema Document *

101.CAL			XBRL Taxonomy Extension Calculation Linkbase Document *

101.DEF			XBRL Taxonomy Extension Definition Linkbase *

101.LAB			XBRL Taxonomy Extension Labels Linkbase Document *

101.PRE			XBRL Taxonomy Extension Presentation Linkbase Document *

104			Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). *

* Exhibit Filed Herewith

Table of Contents

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	KINGFISH HOLDING CORPORATION

Date: February 13, 2025	By:	/s/ Ted Sparling
		Ted Sparling Chief Executive Officer (Principal Executive Officer)

Kingfish Holding Corp 10-Q