RWAX 10-K & 10-Q changes, risk factors and insider trading
Tap Real Estate Technologies, Inc. · OTC · Wholesale-Durable Goods · CIK 1119190 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “The regulatory framework surrounding real estate tokenization is uncertain and evolving, which could adversely affect our business”
New heading “Our real estate tokenization technology is new and relatively unproven, and we may not achieve market acceptance”
New heading “We do not own the intellectual property we use and rely on a temporary license that may not be extended”
New heading “The valuation of tokenized real estate assets involves significant judgment and uncertainty”
New heading “We face significant competition in the real estate tokenization market from both traditional real estate companies and emerging technology platforms”
New heading “We are dependent on a license agreement for rights to critical intellectual property, and the loss or impairment of those rights could materially harm our business.”
Removed heading “Risks Related to the Ownership of Magnesium Silicate Deposits”
Removed heading “Uncertainty in Title and Property Rights”
Removed heading “Exposure to Asset Impairment”
Removed heading “Market Demand and Commercial Viability”
Removed heading “Speculative Nature of Mineral Resource Ownership”
Removed heading “Risk of Expropriation or Regulatory Reclassification”
Removed heading “Environmental and Reputational Exposure from Passive Ownership”
Removed heading “We May Not Successfully Execute Our Strategy to Operate as a Holding Company”
Removed heading “We Are Dependent on the Operations and Performance of Our Subsidiaries”
Removed heading “We May Have Limited Control Over Certain Subsidiaries or Minority Interests”
Removed heading “Structural Subordination of Our Debt and Equity Holders”
Removed heading “Complex Organizational Structure May Limit Transparency and Increase Costs”
Removed heading “Risks Associated with Consolidated Financial Reporting”
Removed heading “Potential Conflicts of Interest Between the Holding Company and Subsidiaries”
Removed heading “Limitations on Upstreaming Cash from Regulated or Foreign Subsidiaries”
Removed heading “We may not be able to raise capital when needed, if at all, which would force us to delay, reduce or eliminate our level of marketing efforts to expand the number of customers and merchants using our products and acquisition of suitable target companies and could cause our business plan to fail.”
Removed heading “Any failure to protect our future intellectual property rights could impair our ability to protect our technology and our brand.”
Removed heading “Any failure to protect our future intellectual property rights could impair our ability to protect our technology and our brand.”
Largest changes
“We are dependent on a license agreement for rights to critical intellectual property, and the loss or impairment of those rights could materially harm our business.”see in full comparison
Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If we do not continue as a going concern, investors could lose their entire investment.see in full comparisonIn addition, we identified an error in our previously reported 2023 figures that resulted in a restatement of our net loss in the year ended December 31, 2023
“We face significant competition in the real estate tokenization market from both traditional real estate companies and emerging technology platforms”see in full comparison
“Our magnesium silicate deposits are carried as long-term assets on our balance sheet. These assets are subject to periodic review for impairment, particularly if adverse changes occur in market conditions, geological assessments, or project economics. A determination that one or more of our mineral properties is not economically viable could result in a significant write-down or impairment charge.”see in full comparison
“Our real estate tokenization business operates in a regulatory environment that is new and rapidly evolving. Federal and state securities laws, real estate regulations, and money transmission requirements may apply to our tokenized real estate offerings in ways that are not yet clearly defined. The SEC, FINRA, state securities regulators, and other governmental bodies may adopt new rules, guidance, or enforcement positions that could require us to modify our business model, obtain additional licenses, or cease certain activities. …”see in full comparison
Full comparison: every changed paragraph (60)
Investing
in our common stock involves a high degree of risk. Prospective investorsYou should carefully consider the risks described below, together
with all of the
other information included or referred to in this prospectus,Annual Report on Form 10-K before purchasing shares of our common stock. There are
numerous and varied risks that may prevent us from achieving our goals. If any of these risks actually occurs, our business, financial
condition or results of operations may be materially adversely affected. In such case, the trading price of our common stock could decline
and investors in our common stock could lose all or part of their investment.
Risks
Related to the Ownership of Magnesium Silicate Deposits
Uncertainty
in Title and Property Rights
We
may not hold clear, marketable, or uncontested title to all of our magnesium silicate deposits. Title to mineral properties can be subject
to numerous uncertainties, including unrecorded agreements, competing claims, survey discrepancies, indigenous land rights, and regulatory
conditions. Any defects or challenges to our title could result in loss of ownership rights, delays in development, or increased legal
and administrative costs.
Exposure
to Asset Impairment
Our
magnesium silicate deposits are carried as long-term assets on our balance sheet. These assets are subject to periodic review for impairment,
particularly if adverse changes occur in market conditions, geological assessments, or project economics. A determination that one or
more of our mineral properties is not economically viable could result in a significant write-down or impairment charge.
Market
Demand and Commercial Viability
The
value of our magnesium silicate holdings depends on market demand in industrial sectors such as fertilizer, construction, ceramics, and
fireproofing. Changes in customer preferences, availability of alternative materials, technological shifts, or reductions in end-use
demand could adversely affect the commercial viability of our deposits and reduce the fair value of these assets.
Speculative
Nature of Mineral Resource Ownership
Ownership
of magnesium silicate properties, without current production or defined development plans, is inherently speculative. There is no guarantee
that these properties will be commercially developed or that they will generate any future revenues. We may continue to incur costs related
to holding, maintaining, or evaluating these properties without realizing any economic return.
Risk
of Expropriation or Regulatory Reclassification
Our
rights to own and control magnesium silicate resources are subject to legal and regulatory frameworks that may change over time. Government
actions, such as land use reclassification, revocation of mineral rights, or expropriation, could limit or eliminate our ownership interest
in these deposits. We may also be affected by legal interpretations relating to public land, environmental protections, or indigenous
sovereignty claims.
Environmental
and Reputational Exposure from Passive Ownership
Even
in the absence of active mining or development operations, ownership of mineral properties may expose us to potential environmental liabilities,
particularly where prior exploration or historical activity has occurred. Additionally, reputational risks may arise from public perception
or stakeholder concern over the environmental impact of mineral resource ownership, even without operational activity on the site.
Risks
Related to Our StructureReal asEstate aTokenization Holding CompanyBusiness
The regulatory framework surrounding real estate tokenization is uncertain and evolving, which could adversely affect our business
Our real estate tokenization business operates in a regulatory environment that is new and rapidly evolving. Federal and state securities laws, real estate regulations, and money transmission requirements may apply to our tokenized real estate offerings in ways that are not yet clearly defined. The SEC, FINRA, state securities regulators, and other governmental bodies may adopt new rules, guidance, or enforcement positions that could require us to modify our business model, obtain additional licenses, or cease certain activities. If our tokens are deemed to be securities under the Howey test or similar analyses, we could face significant compliance obligations, enforcement actions, or liability. The costs of regulatory compliance, or our inability to comply with applicable regulations, could materially and adversely affect our business, financial condition, and results of operations.
Our real estate tokenization technology is new and relatively unproven, and we may not achieve market acceptance
Real estate tokenization is an emerging technology that has not yet been widely adopted in the commercial real estate market. Our success depends on the willingness of property owners, investors, and intermediaries to adopt blockchain-based fractional ownership models, which represent a significant departure from traditional real estate investment structures. Potential customers and investors may be reluctant to adopt our technology due to concerns about security, regulatory uncertainty, liquidity limitations, or unfamiliarity with blockchain technology. If we are unable to achieve sufficient market acceptance of our tokenization platform, our business and prospects would be materially harmed.
We do not own the intellectual property we use and rely on a temporary license that may not be extended
We do not own the core technology platform used in our real estate tokenization business. On December 30, 2025, we entered into a 90-day royalty-free license agreement with TAP, Inc. to use its technology platform while the parties negotiate a longer-term license arrangement. There can be no assurance that we will be able to negotiate a long-term license on commercially reasonable terms, or at all. If we are unable to extend or replace this license, we would lose access to the technology platform that is fundamental to our business operations, which would have a material adverse effect on our business, financial condition, and results of operations. Even if we negotiate a long-term license, the terms may be less favorable than the current arrangement, and we would remain dependent on a third party for our core technology. As of March 25, 2026, the parties are in the final stages of completing a long-term license agreement.
The valuation of tokenized real estate assets involves significant judgment and uncertainty
The valuation of tokenized real estate assets requires significant judgment and is subject to inherent uncertainty. Unlike publicly traded securities, tokenized real estate interests do not have an established public market with transparent pricing. The value of tokenized assets depends on the underlying real estate values, which are affected by local and national economic conditions, interest rates, property-specific factors, and real estate market conditions. Disagreements over valuation methodologies or assumptions could lead to disputes with investors, regulatory scrutiny, or impairment charges that could materially affect our financial statements.
We face significant competition in the real estate tokenization market from both traditional real estate companies and emerging technology platforms
The real estate tokenization market is increasingly competitive. We compete with traditional real estate investment trusts, real estate crowdfunding platforms, and other blockchain-based tokenization companies, many of which have greater financial resources, more established reputations, and more extensive operating histories than we do. Traditional real estate companies may also develop their own tokenization capabilities or partner with technology providers to offer competing products. If we are unable to differentiate our platform and compete effectively, our ability to attract and retain customers and generate revenue could be materially and adversely affected.
We
May Not Successfully Execute Our Strategy to Operate as a Holding Company
We
are in the process of establishing ourselves as a holding company, and currently operate through only two subsidiaries. Our success depends
in part on the performance of these subsidiaries, which may not achieve their operational, financial, or strategic goals. In addition,
our ability to grow and diversify our holdings will depend on our capacity to identify, evaluate, and acquire additional businesses or
assets. We may face challenges in sourcing attractive investment opportunities, conducting effective due diligence, or successfully integrating
new subsidiaries into our organizational structure. Failure to execute this strategy could limit our growth potential and negatively
affect our financial condition and long-term business prospects.
We
Are Dependent on the Operations and Performance of Our Subsidiaries
As
a holding company, we have no significant operations of our own and are dependent upon dividends, distributions, and other payments from
our subsidiaries to fund our obligations, including operating expenses and any returns of capital to our stockholders. If our subsidiaries
are unable to generate sufficient cash flow or are restricted from paying dividends or making distributions under applicable law or contractual
agreements, our ability to meet our financial obligations and return value to shareholders may be adversely affected.
We
May Have Limited Control Over Certain Subsidiaries or Minority Interests
To
the extent we do not own 100% of the equity interests in certain subsidiaries or investments, our ability to control decision-making
at those entities may be limited. This may restrict our ability to direct strategy, allocate capital, or respond quickly to changing
market conditions within those businesses, which could affect consolidated financial results.
Structural
Subordination of Our Debt and Equity Holders
As
a holding company, our debt and equity holders are structurally subordinated to all existing and future liabilities and obligations of
our subsidiaries. In the event of a liquidation or insolvency of any subsidiary, the assets of that subsidiary will be used to satisfy
its liabilities before any distributions are made to us or our creditors or stockholders.
Complex
Organizational Structure May Limit Transparency and Increase Costs
Our
multi-entity structure may limit visibility into the day-to-day operations of our subsidiaries and complicate financial reporting, tax
compliance, and regulatory oversight. This complexity may increase administrative costs, create inefficiencies, or heighten the risk
of internal control deficiencies.
Risks
Associated with Consolidated Financial Reporting
Because
we consolidate the financial results of our subsidiaries, adverse developments at the subsidiary level—including impairments, legal
liabilities, or operational disruptions—could have a direct and material impact on our consolidated financial statements, even
if our holding company operations remain unaffected.
Potential
Conflicts of Interest Between the Holding Company and Subsidiaries
Decisions
that benefit the holding company may not always align with the best interests of an individual subsidiary, and vice versa. In cases where
our subsidiaries have independent governance, third-party investors, or minority shareholders, such conflicts could arise and may lead
to disputes, reputational harm, or limitations on our ability to act unilaterally.
Limitations
on Upstreaming Cash from Regulated or Foreign Subsidiaries
Certain
of our subsidiaries may be subject to regulatory capital requirements, debt covenants, or foreign exchange controls that restrict their
ability to transfer cash or assets to the holding company. These restrictions may limit our financial flexibility and ability to deploy
capital effectively across the enterprise.
We are dependent on a license agreement for rights to critical intellectual property, and the loss or impairment of those rights could materially harm our business.
Our business depends on a license agreement pursuant to which we have been granted rights to use certain intellectual property that is material to our operations. This license agreement contains various obligations that we must satisfy to maintain our rights thereunder. If we fail to comply with any of these obligations, the licensor may have the right to terminate the license agreement, which would deprive us of the right to use the underlying intellectual property and could materially and adversely affect our ability to conduct our business as currently operated. In addition the license is only for limited period of time while the parties negotiate a longer term license, if we are unable to reach terms on a long-term license agreement with the licensor, that would deprive us of the right to use the underlying intellectual property and could materially and adversely affect our ability to conduct our business as currently operated Even if we satisfy all of our obligations under the license agreement, we cannot guarantee that the licensor will not attempt to terminate the agreement, dispute the scope of rights granted thereunder, or take positions adverse to our interests in connection with the licensed intellectual property. Any such dispute could result in costly litigation, divert management attention and resources, and result in the loss or limitation of our licensed rights.
In addition, our rights under the license agreement are only as strong as the underlying intellectual property itself. The licensor is responsible for prosecuting and maintaining the patents and other intellectual property rights that are the subject of the license. If the licensor fails to adequately prosecute, maintain, or defend the licensed intellectual property, those rights could be narrowed, invalidated, or rendered unenforceable. We may have limited ability to compel the licensor to take protective action, and we may lack the right to independently enforce the licensed intellectual property against third-party infringers. The weakening or loss of the underlying intellectual property rights could significantly diminish the value of our license and adversely affect our competitive position.
Furthermore, the license agreement may be subject to termination in connection with the licensor’s bankruptcy or insolvency, a change of control of the licensor, or other events outside of our control. In such circumstances, our ability to continue using the licensed intellectual property could be impaired or eliminated entirely, and we may be unable to obtain a replacement license on commercially reasonable terms, or at all.
The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, and prospects.
Our
operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If we do not
continue as a going concern, investors could lose their entire investment. In addition, we identified an error in our previously reported 2023 figures that resulted in a restatement of our
net loss in the year ended December 31, 2023
Our
operating losses and working capital deficiency raise substantial doubt
about our ability to continue as a going concern. We have an
accumulated deficit of $(117,976,134134,810,209) as of December 31, 20242025 as well as
a net loss of $14,446,392$(15,973,496) and $4,310,995 $(14,446,392)
for the years ended December 31, 20242025 and 2023 (restated), respectively. In the course of preparing
our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023,
related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546
and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.2024. We
may never achieve profitability. If we do not generate sufficient revenues, do not
achieve profitability and do not have other sources
of financing for our business, we may have to curtail or cease our development plans
and operations, which could cause investors to lose
the entire amount of their investment.
We
may not be able to raise capital when needed, if at all, which would force us to delay, reduce or eliminate our level of marketing efforts
to expand the number of customers and merchants using our products and acquisition of suitable target companies and could cause our business
plan to fail.
We
will need substantial additional funding to increase our customer base and pursue our acquisition of companies and business units that
meet our desired standards. There are no assurances that future funding will be available on favorable terms or at all. The failure to
fund our operating and capital requirements could have a material adverse effect on our business, financial condition and results of
operations. If we are unable to raise capital when needed or on attractive terms, we could be forced to reduce our efforts to enlist
more customers and merchants to use our technology and to delay, reduce or eliminate our acquisition strategy. Any of these events could
significantly harm our business, financial condition and prospects.
Current
global financial conditions and recent market events have been characterized by increased volatilityvolatility, and the resulting tightening of
the credit and capital markets has reduced the amount of available liquidity and overall economic activity. We cannot guarantee that
debt or equity financing, the ability to borrow funds or cash generated by operations will be available or sufficient to meet or satisfy
our initiatives, objectives or requirements. Our inability to access sufficient amounts of capital on terms acceptable to us for our
operations will negatively impact our business, prospects, liquidity and financial condition.
As
of the date of this annual report, we have one full-time employee. As our growth plans proceed and development and commercialization
plans and strategies develop, we expect to need additional development, managerial, operational, sales, marketing, financial, accounting,
legal, and other resources. Future growth would impose significant added responsibilities on members of management. Our management may
not be able to accommodate those added responsibilities, and our failure to do so could prevent us from effectively managing future growth,
if any, and successfully growing our Company.
Our
entry into new markets as we seek to expand globally the adoption of our products and services may place a significant strain on our resources
resources and increase demands on our executive management, personnel and systems, and our operational, administrative and financial resources
resources may be inadequate. We may also not be able to effectively manage any expanded operations or achieve planned growth on a timely
or profitable
basis, particularly if the number of customers using our technology significantly increases or their demands and needs
change as our
business expands. If we are unable to manage expanded operations effectively, we may experience operating inefficiencies,
the quality
of our products and services could deteriorate, and our business and results of operations could be materially adversely
affected.
Any
failure to protect our future intellectual property rights could impair our ability to protect our technology and our brand.
Our
success depends in part on our ability to enforce our intellectual property and other proprietary rights of the companies we expect to
acquire. We expect to rely upon a combination of trademark and trade secret laws, as well as license and other contractual provisions,
to protect our intellectual property and other proprietary rights. These laws, procedures and restrictions provide only limited protection
and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated. To the extent
that our intellectual property and other proprietary rights are not adequately protected, third parties may gain access to our proprietary
information, develop and market solutions similar to ours or use trademarks similar to ours, each of which could materially harm our
business. The failure to adequately protect our intellectual property and other proprietary rights could have a material adverse effect
on our business, financial condition and results of operations.
We
depend substantially on the continued services, specialized knowledge and performance of our senior management, particularly ThiagoGregory
Hopkins, Moura,
our President and CEO, and Jeffrey Hinshaw, our COO and CFO. We do not have anything preventing them from terminating their employment with
with us at any time. As a result, these executives may elect to pursue other opportunities at any time. If one or more of these individuals
choose to leave our company, we may lose a significant number of supplier relationships and operating expertise which they have developed
over many yearsyears, and which would be difficult to replace. The loss of the services of any executive officer or other key employee could
hurt our business.
Any
failure to protect our future intellectual property rights could impair our ability to protect our technology and our brand.
Our
success depends in part on our ability to enforce our intellectual property and other proprietary rights of the companies we expect to
acquire. We expect to rely upon a combination of trademark and trade secret laws, as well as license and other contractual provisions,
to protect our intellectual property and other proprietary rights. These laws, procedures and restrictions provide only limited protection
and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated. To the extent
that our intellectual property and other proprietary rights are not adequately protected, third parties may gain access to our proprietary
information, develop and market solutions similar to ours or use trademarks similar to ours, each of which could materially harm our
business. The failure to adequately protect our intellectual property and other proprietary rights could have a material adverse effect
on our business, financial condition and results of operations.
We
cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find
our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may
be more volatile. We may take advantage of these reporting exemptions until we are no longer an emerging growth company. We will remain
an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion
of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large
accelerated filer, which means the market value of our common stock that is held by non- affiliates exceeds $700 million as of the prior
June 30 and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
●
permit our Board of Directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as it
may designate, of which we have designated: 7,000,000 shares of Series A preferred stock with 1,000 votes per share 7,000,000 of
which are outstanding as of December 31, 2024; issue 570,000 Series B preferred stock with 10,000 votes per share 349,091 of which
are issued and outstanding as of December 31, 2024; issue 20,000 Series C preferred stock 12,350 of which are issued and outstanding
as of December 31, 2024; issue 250,000 shares of Series D preferred stock with 500,000 votes per shares 100,000 of which are issued and
outstanding as of December 31, 2024;
Management's Discussion & Analysis (MD&A)
New heading “Initial Capital Raise and Strategic Focus on Blockchain-Enabled Real Estate”
New heading “A Public Company Model for the Next Era of U.S. Real Estate”
New heading “TAP Technology Platform: A Patented Rail System for Real Estate Transactions”
New heading “Patented Intellectual Property and Regulatory Alignment”
New heading “Non-Equity Method Equity Securities”
New heading “Equity Method Investments”
Removed heading “Recent Accounting Pronouncements”
Removed heading “Restatement of Previously Issued Financial Statements for the Year Ended December 31, 2023”
Largest changes
“Restatement of Previously Issued Financial Statements for the Year Ended December 31, 2023”see in full comparison
“TAPs - TAP Real Estate and TAP will also collaborate on the structure and issuance of Tokenized Asset Portfolios (TAPs), being designed as a next-generation evolution beyond legacy real estate investment trusts (REITs). These portfolios are intended to modernize real estate capital formation, ownership, and liquidity through blockchain-enabled infrastructure, and can be developed in coordination with ecosystem partners across real estate, title, mortgage, and adjacent transactional industries.”see in full comparison
“In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.”see in full comparison
“In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.”see in full comparison
“In the course of preparing our consolidated financial statements for the year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid in capital. There was no effect on net equity or cash flows resulting from this restatement.”see in full comparison
“For certain investments, particularly illiquid debt instruments, valuation techniques may incorporate expected recovery values, probability-weighted scenarios, default assumptions, and credit spreads. For complex or structured instruments, option pricing models or simulation techniques may also be used.”see in full comparison
Full comparison: every changed paragraph (80)
The
following discussion should be read in conjunction with the consolidated financial statements and the related notes contained herein.
In addition to historical information, the following discussion contains forward lookingforward-looking statements based upon current expectations that
are subject to risks and uncertainties. Actual results may differ substantially from those referred to herein due to a number of factors,
including, but not limited to, risks described in the section entitled “Risk Factors”.
Our
executive offices are located at 101 W. Broadway, Suite 1450, San Diego, California 92101, telephone (786) 738-9012. Our corporate website
address is www.humbl.com.www.taprealestate.com.
The Company announced on December 31, 2025 that it has initiated a strategic corporate rebrand to TAP Real Estate Technologies, Inc. (“TAP Real Estate”), reflecting the Company’s sharpened focus on real estate asset acquisition, ownership, and blockchain-enabled real estate tokenization. In connection with the rebrand, the Company will also be submitting an application to change its ticker symbol, subject to regulatory approval.
TAP Real Estate Is focused on the acquisition, management, and tokenization of real estate. The Company seeks to combine established real estate fundamentals with emerging digital and blockchain tokenization technologies in order to enhance transparency, operational efficiency, and investor access in the real estate industry.
The rebrand marks a formal repositioning of the Company toward the next generation of real estate capital formation, where traditional property ownership models converge with digital wallets, blockchain registries, smart contracts, and tokenized investment infrastructure.
Initial Capital Raise and Strategic Focus on Blockchain-Enabled Real Estate
As part of this transition, TAP Real Estate has secured $500,000 in initial investment capital to establish operations and support early-stage execution. The Company is actively evaluating a pipeline of residential, commercial, and hospitality real estate opportunities for potential fractional or full contribution to its balance sheet, alongside select tokenization opportunities to be offered through the TAP Invest platform.
Property evaluations are being conducted with a disciplined focus on asset quality, cash-flow durability, jurisdictional suitability, and long-term value creation. Particular emphasis is being placed on identifying properties that are well-positioned to support blockchain-tokenized capital inflows, interest-bearing yield structures, and digital ownership frameworks anticipated under emerging U.S. regulatory guidance expected in 2026.
A Public Company Model for the Next Era of U.S. Real Estate
In support of this strategy, TAP Real Estate has entered into a licensing agreement with TAP, a private technology company headquartered in Salt Lake City, Utah, granting TAP Real Estate the right to utilize the proprietary TAP Platform technologies specifically for real estate use cases.
This agreement establishes a public company model designed to combine the benefits of a publicly held company (TAP Real Estate) with a patented, vertically integrated blockchain technology and intellectual property platform held as a private company (TAP).
Under this structure, TAP Real Estate will hold and manage select real estate assets, while leveraging licensed digital infrastructure to tokenize ownership interests, manage investor participation, and support compliant issuance and lifecycle administration.
The objective is to create a repeatable, compliant model for how real estate can be acquired, structured, tokenized, and administered within U.S. capital markets, serving as a blueprint for the broader industry.
TAP Technology Platform: A Patented Rail System for Real Estate Transactions
The TAP Platform products that will be licensed by TAP Real Estate, specifically for tokenized real estate listings, includes:
TAP AI Analyzer - In addition to its core features of investment portfolio insights and tailoring, the analyzer is being developed to define real estate listings metrics and quality of properties for inclusion in the portfolio.
TAURUS AI-Agent - Serves as an agentic customer service agent, and, in the future, an automated payments agent across the lifecycle of real estate transactions.
TAP Wallet - Serves as an investor’s access and identity layer for tokenized real estate, helping abstract blockchain complexity while supporting security and compliance controls. The wallet is intended to hold tokenized interests, receive income distributions, and support permitted voting or corporate actions, while enabling onboarding and investor eligibility gating through KYC, accreditation verification (as applicable), and jurisdiction-based rules.
TAP Token Engine - Provides an issuance and lifecycle layer that converts approved real estate holding structures (such as SPVs) into tokenized interests with defined parameters. This includes supply configuration, ownership caps, transfer restrictions, and jurisdictional limitations where required. The Token Engine is intended to support the ongoing lifecycle of tokenized interests, including primary issuance, permitted secondary transfers, redemptions or buybacks, and select corporate actions.
TAP Smart Contracts - Encodes and enforces key rules of a tokenized real estate offering at the transaction level, including who can hold tokens and under what conditions transfers are permitted. The smart contract layer is intended to automate functions such as distributions, governance/voting, and other real estate specific mechanics, reducing reliance on manual processing and improving auditability.
TAP Invest - An investment platform with integrations across stocks, Mutual Funds, ETFs, digital assets, precious metals and real world assets with integrations across major brokerages, digital asset exchanges and broker-dealers such as Public, E*TRADE, Fidelity, Coinbase, Gemini, Kraken, Binance and more.
TAP Registry - Serves as the asset “source of truth” for the platform, operating as a private, semi-private, and public registry environment for real-world assets. The registry is intended to maintain the canonical record of each underlying real estate holding and its lifecycle events such as structuring, approvals, liens, transfers, redemptions, anchoring those records to a combination of public blockchains and permissioned infrastructure. For each asset, TAP Registry is designed to store structured metadata, document references such as deeds, appraisals, inspections, insurance, and compliance attestations in a tamper-evident format, while separating public verification data from confidential owner, counterparty, and transaction details. This registry layer is intended to power authentication, registry, and transfer of tokenized interests across the TAP platform, and to provide an auditable history that can be consumed by the TAP Wallet, TAP Token Engine, TAP Smart Contracts, and downstream real estate ecosystem partners such as title, mortgage, brokerage, and marketplace platforms, for integrations.
TAPs - TAP Real Estate and TAP will also collaborate on the structure and issuance of Tokenized Asset Portfolios (TAPs), being designed as a next-generation evolution beyond legacy real estate investment trusts (REITs). These portfolios are intended to modernize real estate capital formation, ownership, and liquidity through blockchain-enabled infrastructure, and can be developed in coordination with ecosystem partners across real estate, title, mortgage, and adjacent transactional industries.
At a high level, the TAP platform will operate through a streamlined, end-to-end lifecycle designed to ensure regulatory compliance, operational integrity, and investor transparency. Each real estate asset will first be approved and structured through a formal legal and compliance review. Once approved, the issuance is configured within the Token Engine, including token supply, investor permissions, and economic parameters. Purpose-built smart contracts are then deployed to enforce transaction logic and compliance at the protocol level. Investors are onboarded through the Invest Platform, where identity verification and eligibility checks are completed prior to participation. Following onboarding, the primary issuance is executed and tokens are delivered directly to investor wallets. After issuance, the platform supports ongoing administration, including distributions, governance actions, and permitted transfers, providing a fully managed and auditable post-issuance environment.
TAP Real Estate plans to drive revenues through a blend of management fees, listing fees and success fees on tokenized listings of real estate listings; as well as adding to the balance-sheet value any properties that are attributed to the TAP Real Estate portfolio after vetting by the TAP Real Estate team.
Patented Intellectual Property and Regulatory Alignment
The TAP intellectual property portfolio includes U.S. Patent 12,118,613, “System and Method for Transferring Currency Using Blockchain” (Foote et al., valid through 2041). The patent contemplates the transfer of stablecoins, digital assets, and tokenized currencies between digital wallets and computer systems, with direct applicability across escrow, payment, and settlement workflows in real estate, title, and mortgage transactions. Additional patents are pending in areas related to blockchain tokenization of assets, multi-asset tokenized baskets, and real-world assets.
On
December 2, 2024, HUMBL, Inc. (the “Company” or “HUMBL”) entered into an Asset Purchase Agreement (the “Asset
Purchase Agreement”) with WSCG, Inc. (“WSCG”), and WSCG Humbl SPV, a series of SPV Management, LLC (“HoldCo”).
Pursuant to Asset Purchase Agreement, the Company sold all of its assets to WSCG. In consideration for the purchase of the Company’s
assets, WSCG agreed to: (a) pay the Company $3,025,000; (b) issue 2,455,556 shares of WSCG Class B Common Stock to HoldCo; and (c) grant
24,555,556 membership units of HoldCo to the Company (the “HoldCo Units”). Of the $3,037,500 payable in cash to the Company,
$500,000 was paid in cash by WSCG to the Company prior to the closing date, and $537,500 of indebtedness previously funded to the Company
by affiliates of WSCG was cancelled. The remaining $2,000,000 of the cash purchase price was paid by WSCG on April 1, 2025.
The
HoldCo Units represent approximately 27.5% of the outstanding equity in WSCG. Upon transfer
of the HoldCo Units, the Company will own 100% of HoldCo. The Company intends to keep a portion of the HoldCo Units to maintain exposure
to WSCG’s performance and the Company assets purchased by WSCG. The Company will also offer to exchange some of the HoldCo Units
to its debtholders and holders of Series C Preferred Stock as a way to eliminate debt and reduce potential future dilution to common
stockholders. The transfer of the Company’s assets to WSCG took place on February 27, 2025.
On
December 2, 2024, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with Ybyrá
Capital S.A. (“Ybyrá”) and Brian Foote, the Company’s former CEO and current director. Pursuant to
the Stock Purchase Agreement: (a) HUMBL purchased 99% of the outstanding equity interests of FinCapital Credito Pagamentos e Servicos
LTDA, a Brazilian company (“FinCapital”), from Ybyrá; and (b) Brian Foote sold his 7,000,000 shares of Series A Preferred
Stock and 100,000 shares of Series D Preferred Stock of the Company (the “Control Shares”) to Ybyrá. With the purchase
of the Control Shares, Ybyrá is now the controlling stockholder of the Company. FinCapital a previously dormant entity and had
at the time of the purchase one asset which consisted of 41,500 tons of magnesium silicate with a book value of $20,000,000. Magnesium silicate is
a raw material used in industrial sectors such as fertilizer, construction, ceramics, and fireproofing FinCapital
is now a 99% owned subsidiary of the Company. The Company agreed to issue $20,000,000 in common shares to Ybyrá for the purchase
of the FinCapital equity interest. HUMBL will pay $4,000,000 of the purchase price through the issuance of 10,000,000,000 common share
to Ybyrá ($0.0004 per share). The remaining $16,000,000 in common shares will be issued following a recapitalization event that
provides sufficient authorized shares to make the issuance.
As
a result of the WSCG purchase of the Company assets, the previous operations of the Company will be reflected as discontinued operations,
and the assets that were sold are all reflected as assets under discontinued operations.
Following
the purchase of FinCapital and the change of control associated with such acquisition, the Company’s business model has changed.
For the 2025 fiscal year, HUMBL will no longer be pursuing Web 3 and related technologies. Instead, the Company will adopt a holding
a company model. HUMBL will be the parent holding company and will own and operate various subsidiaries, with a particular focus in Brazil
and Latin America. FinCapital will be first business operated by HUMBL under the new holding company structure.
FinCapital
owns 41,500 tons of magnesium silicate. Magnesium silicate is a raw material that can be used in fertilizer and other industrial applications.
FinCapital is currently looking to sell the magnesium silicate and acquire other raw materials or other mining interests.
On
April 3, 2025, HUMBL entered into a Joint Venture Agreement with Multicortex, LLC. Multicortex is a company focusing on artificial intelligence
and high-performance computing. Pursuant to the agreement, HUMBL acquired a 51% interest in Multicortex. In exchange, HUMBL will contribute
15% of any funds it raises in any Regulation A+ offering (up to $3,000,000) to fund development of Multicortex’s suite of products.
HUMBL’s
controlling shareholder, Ybyrá, is a Brazilian holding company with interests in mining, real estate, oil and gas, and
related fields. Our CEO, Thiago Moura, is an experienced entrepreneur with deep connections in Brazil and throughout Latin America.
Our plan is to find and acquire undervalued assets and business in North and South America, with a particular focus in Brazil, and
then operate those businesses as subsidiaries under our corporate umbrella.
Revenues,
cost of revenues and gross profit for the years ended December 31, 20242025 and 20232024 are related to our operations that are reflected in
discontinued operations. The Company haswas recentlyfocused acquiredon the business of FinCapital which consisted of one singular asset which were minerals
located in Brazil.Brazil Theuntil mineralsthe fourth quarter of 2025 when they focused on the rebranding of the Company to TAP Real Estate. There are magnesiumno
revenues, silicate.cost of revenues or gross profit for either of the two years 2025 and 2024 in continuing operations.
Operating
expenses for the year ended December 31, 20232025 were $10,061,013$7,621,857 as compared to $8,302,341 for the year ended December 31, 2024, a decrease
of $1,758,672.
$680,484. Operating expenses consists of professional feesfees, settlement expenses and general and administrative expenses as fully described below. We expect
our professional
fees to continue to decrease in our next 12 months as we look to scale back on outside contract labor due to the change in our business
operations. Our non-cash charges have already declined over the past year as our stock-based compensation is reduced.
Professional
fees which consist of contracted individuals and companies, legal, audit and accounting costs for the year ended December 31, 20232025
were were
$2,770,689$1,346,657 compared to $1,051,539 for the year ended December 31, 2024. The decreaseincrease in professional fees is related to the
professional fees
incurred in regulatory filings including OTC compliance and reporting as well as increases in consultant costs in 2023
2024 versus 2024.2025. We
expect that these costs will continue decreasingdecrease during 2025.2026.
General
and administrative expenses for the year ended December 31, 20232025 were $6,483,924$4,144,029 compared with $4,274,422 for the year ended December
31, 2024. The decrease in general and administrative expenses ofwas $2,209,502.$130,393. Much of the decrease in general and administrative expenses
relates to decreases in stock-based compensation as well as payroll and payroll-related expenses due to less personnel employed.employed, and decreases in travel costs, computer software, meals and entertainment, bank charges due to reductions in operations
as we transitioned into TAP Real Estate.
In
the year ended December 31, 20232025 we incurred $4,462,040$25,151,224 in other expenses, compared to $3,122,068 in other
expenses in the year
ended December 31, 2024, aan decreaseincrease of $1,339,972$22,029,156 in other expenses. The other expenses relate to amortization of discounts,
discounts, interest expense and losses on the conversion of convertible notesnotes, changes
in fair value of derivative liabilities, derivative expense, and exchangesa loss on investee and on the
investment in TAP HoldCo and the loss on disposal of warrants.minerals Weand extinguishment of debt. In 2024, we incurred other income from
changes in our derivative liability as well as in 2024, athe gain on the sale of HUMBL
financial assets in the amount of $2,800,000.$2,800,000 and changes in the fair value of derivative liabilities offset by losses attributable to conversions of debt and
derivative expenses.
Net
loss from operations from continuing operations for the year ended December 31, 20232025 was ($14,523,053$32,773,081) as compared to a net loss of ($11,424,409)
for the year
ended December 31, 2024. The $3,098,644$21,348,672 decreaseincrease in the net loss was due to the changes noted herein.
In the course of preparing our consolidated financial statements for the
year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares
of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid
in capital. There was no effect on net equity or cash flows resulting from this restatement.
As discussed above in Note 1, the Company has recently begun a rebranding to TAP Real Estate in efforts to build sustaining operations and drive cash flow.
As
of December 31, 2024,2025, we had $20,487$126,066 in cash. During the last two years we built our platform and grew our operations by acquiring companies
to support what we have just recently consolidated into HUMBL.com.HUMBL.com, prior to the sale to TAP. The acquisitions of Tickeri and Monster, which have since been
disposed of, increased our debt and our common shares issued as
we spent very little cash in these acquisitions. The impact of COVID-19, supply chain issues, challenges in the cryptocurrency market
and recent bank failures have had a minimal impact on the Company’s operations.
We
had a working capital deficit of $23,693,753$2,870,414 and $4,690,800$23,693,753 as of December 31, 20242025 and 2023,2024, respectively. The majority of our
current current
liabilities are in the form of long-term debt and notes payable, and accounts payable and accrued expenses. It is expected that a portion of
these liabilities will require cash to settle them. The decreaseincrease in working capital
is the direct result of the settlement of $20
million worth of common stock that were to be issued to Ybyrá that have been reflected in additional paid in capital due to
the related party nature of the settlement, and our investment in TAP Holdco as well as reductions of notes payable, accrued
interest and accrued expenses as well as the changereceipt of the remaining balance owed by TAP received in the contingentyear consideration.ended December 31,
2025. A significant portion of the investment in TAP Holdco received in February 2025 was exchanged for Series C Preferred shares in
August 2025. The Company’s assets as of December 2, 2024 were sold to TAP Inc. and the Company commenced a new business with
the purchase of the magnesium
silicate. silicate which was returned to Ybyrá pursuant to the Settlement Agreement dated September 9, 2025. The Company anticipates entering into profitable businesses upon the sale of the magnesium
silicate. As a result of the operating
losses and working capital deficit, management has determined that there is substantial doubt
about the Company’s ability to continue
as a going concern.
In
January 2023 and June 2023, we recognized a gain on disposal of $13,685,645 when we settled all claims with the former owners of Tickeri
and Monster and sold them back their companies.
Net
cash used in operating activities was $3,183,582$1,656,535 and $4,118,487$3,183,582 for the years ended December 31, 20242025 and 2023,2024, respectively. The
$1,527,047 $934,905
decrease in net cash used in operating activities was primarily a result of the change in the net loss and the non-cash
charges impacting
our net loss from 20232024 to 2024,2025, such as the gain on the sale of HUMBL Financial assets, gain on sale of HUMBL.com and related assets,
losses on the conversion of convertible notes
notes, extinguishment of debt and decreases in our stock-based compensation.
We
had no activities from investing activities in the years ended December 31, 2023.2025 Inand 2024,2024 weother than the balance of the proceeds received
from TAP for the sale of HUMBL.com in the amount of $2,000,000 in 2025 and $500,000 in cash for the acquisition
of the HUMBL operations to WSCG.2024.
Cash
(used in) provided by financing activities was $2,109,705
$(237,886) and $4,003,716$2,109,705 for the years ended December 31, 20242025 and 2023,2024, respectively. In 2024,
the Company raised $1,354,000$2,279,500 from the
proceeds from convertible notes, $395,500 from related party, non-related party and convertible notes payablepayable, and $530,000$356,000 from notes
payableproceeds for the sale of warrants, as well
as repayments of related party and convertible notes payable of $345,795, $180,000 in related party notes payable and raised $356,000 from
the sale of warrants.$525,795. In 2023,2025, we raised $1,365,050 from the sale of stock, $1,925,000$904,825 from proceeds of convertible notes
payable and
$1,075,365 $12,000 from related party notes payable,payable. In addition, in 2025, we repaid $404,711 in related party notes and $50,000$750,000 from a contribution of capital by our CEO and $260,000 from in
notes payable. We
also repaid $568,283 of notes payable.
In the course of preparing our consolidated financial statements for the
year ended December 31, 2024, we identified an error in the year ended December 31, 2023, related to the exchange of warrants for shares
of our common stock. As a result of this error, we had an increase in our net loss of $288,546 and an increase in our additional paid
in capital. There was no effect on net equity or cash flows resulting from this restatement.
The
preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. These estimates include,
but are not limited to, management’s estimate of provisions required for permanent and temporary differences related to income
taxes, liabilities to accrue, estimates of the fair value of goodwill and determination of the fair value of stock awards. Actual results
could differ
from those estimates.
ASC
825 Financial Instruments requires the Company to disclose estimated fair values for its financial instruments. Fair value estimates,
methods, and assumptions are set forth below for the Company’s financial instruments: The carrying amount of cash, accounts receivable,
prepaid and other current assets, accounts payable and accrued liabilities, and amounts payable to related parties, approximate fair
value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.
Level 3 inputs are unobservable inputs for the asset or liability and are used when observable market data is not available. The Company’s Level 3 investments primarily consist of [private equity investments, illiquid debt instruments, complex derivatives, or other investments for which little or no market activity exists].
The fair value of Level 3 investments is estimated using valuation techniques that incorporate significant unobservable inputs and reflect the Company’s assumptions about the assumptions that market participants would use in pricing the asset or liability. The Company applies a combination of valuation approaches, including the market approach, income approach, and, when applicable, the cost approach, depending on the nature of the investment and the availability of relevant information.
Under the market approach, fair value is estimated based on observable transactions for similar instruments, including recent third-party transactions in the same or comparable investments, or by applying valuation multiples derived from comparable public companies or precedent transactions. Significant inputs may include EBITDA or revenue multiples, liquidity discounts, control premiums, and adjustments for differences in growth prospects, profitability, and risk characteristics.
Under the income approach, the Company utilizes discounted cash flow models or other present value techniques to estimate fair value. These models incorporate significant assumptions, including projected revenues and expenses, expected cash flows, discount rates, terminal growth rates, and timing of exit. Discount rates are generally developed using a weighted-average cost of capital that reflects current market conditions and the risks inherent in the investment.
For certain investments, particularly illiquid debt instruments, valuation techniques may incorporate expected recovery values, probability-weighted scenarios, default assumptions, and credit spreads. For complex or structured instruments, option pricing models or simulation techniques may also be used.
The determination of fair value for Level 3 investments requires significant management judgment. The Company calibrates its valuation techniques to transaction prices, when available, and periodically evaluates and updates key assumptions to reflect current market conditions and specific investment performance. Changes in valuation techniques or significant increases or decreases in unobservable inputs may result in materially different fair value measurements.
The Company may utilize information from independent third-party valuation specialists to assist in determining fair value. The Company evaluates the methodologies, significant assumptions, and outputs of such specialists, and performs procedures to assess the reasonableness of the valuations, including back-testing against realized transactions, comparison to relevant market data, and sensitivity analyses over significant unobservable inputs.
Given the inherent uncertainty associated with the use of unobservable inputs, the estimated fair values of Level 3 investments may differ materially from the values that would have been used had an active market existed for such investments.
What changed in the latest 10-Q
Risk Factors
Not applicable as we are a smaller reporting company.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “Results of Continuing Operations for the Three Months Ended June 30, 2026 and 2025”
New heading “Revenues and Cost of Revenues and Gross Profit”
New heading “Operating Expenses (including Settlement)”
New heading “Professional Fees”
New heading “General and Administrative”
New heading “Other Income (Expense)”
New heading “Net Loss from Continuing Operations”
Largest changes
“Results of Continuing Operations for the Three Months Ended June 30, 2026 and 2025”see in full comparison
Full comparison: every changed paragraph (37)
The
Company announced on December 31, 2025 that it has initiated a strategic corporate rebrand to TAP Real Estate Technologies, Inc. (“TAP
Real Estate”), reflecting the Company’s sharpened focus on real estate asset acquisition, ownership, and blockchain-enabled
real estate tokenization. In connection with the rebrand, the Company will also be submitting an application to change its ticker symbol,
subject to regulatory approval.
In
support of thisits strategy, TAP Real Estate has entered into a licensing agreement with TAPTAP, Inc., a private technology company headquartered
headquartered in Salt Lake City, Utah,Utah. grantingThe agreement grants TAP Real Estate the right to utilize thecertain proprietary TAP Platform technologies and
specificallyintellectual property for real estateestate-related use cases.applications.
These technologies include consumer-facing applications, enterprise software, digital asset administration tools, and real estate workflow solutions designed to support the Company’s acquisition, management, and tokenization strategy The Company’s business model is designed to combine the access, transparency, and reporting framework of a publicly held real estate company with licensed technology infrastructure developed to support digital asset management, real estate transactions, investor participation, and blockchain-enabled ownership structures.
This
agreement establishes a public company model designed to combine the benefits of a publicly held company (TAP Real Estate) with a patented,
vertically integrated blockchain technology and intellectual property platform held as a private company (TAP).
Under
this structure,model, TAP Real Estate willintends holdto acquire, hold, operate, and manage select real estate assets,assets while leveragingutilizing the licensed digitalTAP
technology infrastructure to tokenize
ownershipsupport interests,property manageadministration, digital recordkeeping, investor participation,onboarding, and supporttokenization, compliant issuanceissuance,
distributions, and lifecycle administration.management.
The
Company’s objective is to createdevelop a repeatable,scalable compliantand repeatable model forthrough howwhich real estate canassets may be acquired, operated, structured,
financed, tokenized,and, where appropriate, tokenized within applicable U.S. legal and administeredregulatory within
U.S. capital markets, serving as a blueprint for the broader industry.frameworks.
Subsequent to June 30, 2026, the Company launched TAPRealEstate.com and MyHomeCloud™ as foundational components of this strategy. TAPRealEstate.com serves as the public-facing platform for the Company’s real estate technology ecosystem, while MyHomeCloud™ provides homeowners with a digital platform for organizing and managing important property information. The Company believes these products expand its addressable market beyond real estate investment and tokenization by establishing direct technology offerings for homeowners, property operators, and other participants in the residential real estate ecosystem.
The
TAP Platform products that will beare licensed by TAP Real Estate, specifically for tokenized real estate listings, includes:
Results
of Continuing Operations for the ThreeSix Months Ended MarchJune 31,30, 2026 and 2025
The
following table sets forth the summary operations for the threesix months ended MarchJune 31,30, 2026 and 2025:
Revenues,
cost of revenues and gross profit for the threesix months ended MarchJune 31,30, 2026 and 2025 are related to our operations that are reflected in
in discontinued operations. The Company was focused on the business of FinCapital which consisted of one singular asset which were minerals
located in Brazil until the fourth quarter of 2025 when they focused on the rebranding of the Company to TAP Real Estate. There are no
revenues, cost of revenues or gross profit for either of the two periods in 2026 and 2025 in continuing operations.
Operating Expenses (including Settlement)
Operating
expenses for the threesix months ended MarchJune 31,30, 2026 were $1,752,247$2,794,997 as compared to $1,380,493$3,271,870 for the threesix months ended MarchJune 31,30, 2025, a decrease
an increase of $371,754.$476,873. Operating expenses consists of professional fees, settlement expenses and general and administrative expenses
as fully described
below. We expect our professional fees to increase in our next 12 months as we look to scale our TAP Real Estate Technologies
business. OurThe non-cash stock-based compensationvariance related mostly to ourthe
settlement warrantsmade will cease asin the vestingamount periodof runs$450,000 throughand Junereduction 30,of 2026.professional fees.
Professional
fees which consist of contracted individuals and companies, legal, audit and accounting costs for the threesix months ended MarchJune 31,30, 2026
were $193,588$307,521 compared to $391,861$851,402 for the threesix months ended MarchJune 31,30, 2025. The decrease in professional fees is related to the professional
fees incurred in regulatory filings including OTC compliance and reporting as well as increases in consultant costs in 2025 versus 2026.
We expect that these costs will increase during 2026.
General
and administrative expenses for the threesix months ended MarchJune 31,30, 2026 were $1,558,659$2,487,476 compared with $988,632$1,970,468 for the threesix months ended
MarchJune 31,30, 2025. The increase in general and administrative expenses was $570,027.$517,008. Much of the increase in general and administrative expenses
expenses relates to increases in stock-based compensation due to new employment agreements, offset by payroll and payroll-related expenses due
due to less personnel employed, and decreases in travel costs, computer software, meals and entertainment, bank charges due to reductions
in operations as we transitioned into TAP Real Estate.
In
the threesix months ended MarchJune 31,30, 2026 we incurred $1,211,029$1,717,269 in other expenses, compared to $2,604,811$3,576,987 in other expenses in the threesix
months ended MarchJune 31,30, 2025, a decrease of $1,393,782$1,859,718 in other expenses. The other expenses relate to amortization of discounts,
interest expense, net of interest
expense income and losses on the conversion of convertible notes, loss on extinguishment of debt, changes
in fair value of derivative liabilities, derivative expense, and a
loss on investee.
Net
loss from operations from continuing operations for the threesix months ended MarchJune 31,30, 2026 was ($2,963,276$4,512,266) as compared to a net loss of
of ($3,985,304$6,848,857) for the threesix months ended MarchJune 31,30, 2025. The $1,022,028$2,336,591 decrease in the net loss was due to the changes noted herein.
Results of Continuing Operations for the Three Months Ended June 30, 2026 and 2025
The following table sets forth the summary operations for the three months ended June 30, 2026 and 2025:
Revenues and Cost of Revenues and Gross Profit
Revenues, cost of revenues and gross profit for the three months ended June 30, 2026 and 2025 are related to our operations that are reflected in discontinued operations. The Company was focused on the business of FinCapital which consisted of one singular asset which were minerals located in Brazil until the fourth quarter of 2025 when they focused on the rebranding of the Company to TAP Real Estate. There are no revenues, cost of revenues or gross profit for either of the two periods in 2026 and 2025 in continuing operations.
Operating Expenses (including Settlement)
Operating expenses for the three months ended June 30, 2026 were $1,042,750 as compared to $1,891,377 for the three months ended June 30, 2025, a decrease of $848,627. Operating expenses consists of professional fees, settlement expenses and general and administrative expenses as fully described below. We expect our professional fees to increase in our next 12 months as we look to scale our TAP Real Estate Technologies business. The variance related mostly to the settlement made in the amount of $450,000 and reductions in professional fees.
Professional Fees
Professional fees which consist of contracted individuals and companies, legal, audit and accounting costs for the three months ended June 30, 2026 were $113,933 compared to $459,541 for the three months ended June 30, 2025. The decrease in professional fees is related to the professional fees incurred in regulatory filings including OTC compliance and reporting as well as increases in consultant costs in 2025 versus 2026. We expect that these costs will increase during 2026.
General and Administrative
General and administrative expenses for the three months ended June 30, 2026 were $928,817 compared with $981,836 for the three months ended June 30, 2025. The decrease in general and administrative expenses was $53,019. Much of the decrease in general and administrative expenses relates to increases in stock-based compensation due to new employment agreements, offset by payroll and payroll-related expenses due to less personnel employed, and decreases in travel costs, computer software, meals and entertainment, bank charges due to reductions in operations as we transitioned into TAP Real Estate.
Other Income (Expense)
In the three months ended June 30, 2026 we incurred $506,240 in other expenses, compared to $972,176 in other expenses in the three months ended June 30, 2025, a decrease of $465,936 in other expenses. The other expenses relate to amortization of discounts, interest expense, net of interest income and losses on the conversion of convertible notes, loss on extinguishment of debt, changes in fair value of derivative liabilities, derivative expense, and a loss on investee.
Net Loss from Continuing Operations
Net loss from continuing operations for the three months ended June 30, 2026 was ($1,548,990) as compared to a net loss of ($2,863,553) for the three months ended June 30, 2025. The $1,314,563 decrease in the net loss was due to the changes noted herein.
As
of MarchJune 31,30, 2026, we had $6,682$165,611 in cash. During the last two years we built our platform and grew our operations by acquiring companies
to support what we consolidated into HUMBL.com, prior to the sale to TAP. The acquisitions of Tickeri and Monster, which have since been
disposed of, increased our debt and our common shares issued as we spent very little cash in these acquisitions.
We
had a working capital deficit of $3,592,070$3,293,389 and $2,870,414 as of MarchJune 31,30, 2026 and December 31, 2025, respectively. The majority of
our current liabilities are in the form of notes payable, and accounts payable and accrued expenses. It is expected that a portion
of of
these liabilities will require cash to settle them. The decreaseincrease in working capital deficit is the direct result of proceeds
received from convertible
notes payable, and changes in the derivative liability, accrued interest and accrued expenses in
the threesix months ended MarchJune 31,30, 2026. A significant portion of the investment
in TAP Holdco received in February 2025 was exchanged
for Series C Preferred shares in August 2025. As a result of the operating losses
and working capital deficit, management has
determined that there is substantial doubt about the Company’s ability to continue
as a going concern.
Net
cash used in operating activities was $389,384$600,455 and $298,235$1,427,227 for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. The $91,149$826,772
increasedecrease in net cash used in operating activities was primarily a result of the change in the net (loss) income and the non-cash charges
impacting our net loss from 2025 to 2026, such as the gain on sale of HUMBL.com, losses on the conversion of convertible
notes, extinguishment
of debt and stock-based compensation.
We
had no activities from investing activities in the threesix months ended MarchJune 31,30, 2026 and 2025 other than the balance of the proceeds received
received from TAP for the sale of HUMBL.com and related assets in the amount of $2,000,000 in 2025, and the deposit paid on an option
for $250,000$250,000,
$125,000 in cash paid under a note receivable and $695,000 in cash paid for license fees in 2026.
Cash
provided by financing activities was $1,215,000 and $377,000$1,710,000 for the threesix months ended MarchJune 31,30, 2026 and cash used in financing activities was $467,711
for the six months ended June 30, 2025, respectively. In 2026,
the Company raised $705,000$855,000 from the proceeds from convertible notes payable,
and $510,000$855,000 from proceeds for the sale of common stock
for which the shares have not been issued as of MarchJune 31,30, 2026. In 2025, we raised $365,000
$675,000 from proceeds of convertible notes payable
and $12,000 from related party notes payable, and repaid $750,000 in notes payable
and $404,711 in related party notes payable.
As
Marchof 31,June 30, 2026 and December 31, 2025, we had no off-balance sheet arrangements.
RWAX insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
No Form 4 stock transactions in this period.
Well-known investors holding RWAX (13F)
None of the 59 investors we track reported a position in their latest 13F.