WAST 10-K & 10-Q changes, risk factors and insider trading

We are an early-stage company with a limited operating history in the waste-to-energy sector, and we may never achieve or sustain profitability.

We are an early-stage company and have a limited operating history in the waste-to-energy sector. We have not yet commenced commercial operations at our planned Midland, Texas facility, and we generated only $424,167 in revenue during the year ended December 31, 2025, and $nil during the year ended December 31, 2024, substantially all of which was derived from a single consulting customer. We have incurred significant operating losses since inception and expect to continue to incur losses as we complete the commissioning of our Midland facility and expand our operations. There can be no assurance that we will generate meaningful revenue, achieve profitability, or sustain profitability if achieved.

Our financial statements have been prepared assuming we will continue as a going concern, and there is substantial doubt about our ability to do so.

For the years ended December 31, 2025 and 2024, we incurred net losses of approximately $1.0 million and $2.9 million, respectively. As of December 31, 2025, we had an accumulated deficit of approximately $51.0 million, negative working capital of approximately $4.7 million, and cash and cash equivalents of approximately $68,000. Our independent registered public accounting firm has included an explanatory paragraph in its report on our consolidated financial statements expressing substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate revenue from our waste conversion operations, raise additional capital on acceptable terms, and manage our operating expenses. The inclusion of a going-concern explanatory paragraph may make it more difficult for us to obtain additional financing on acceptable terms, may cause counterparties to hesitate to enter into commercial arrangements with us, and may adversely affect the market price of our common stock. If we are unable to continue as a going concern, we may be required to curtail or cease operations, and stockholders could lose all or a substantial portion of their investment.

We will require substantial additional capital to execute our business plan, and financing may not be available on acceptable terms, or at all.

Developing, commissioning, and operating waste conversion facilities is capital-intensive. We estimate we will require approximately $900,000 to fund our general and administrative operating expenses over the next twelve months, in addition to capital required to complete commissioning of our Midland facility, expand to additional processing capacity, and pursue future deployments. We do not have committed sources of financing sufficient to meet these needs, and we expect to seek additional financing through the sale of equity or debt securities or credit facilities. Financing may not be available on acceptable terms, or at all. Our status as an early-stage company, our going-concern qualification, our penny stock classification, the limited trading market for our common stock, and general credit and capital market conditions may limit our access to capital and increase our cost of financing. Any equity financing will dilute existing stockholders, and any debt financing may impose operating restrictions or require the issuance of securities with dilutive or other adverse terms. If we are unable to obtain required capital, we may be unable to execute our business plan, and our business, financial condition, and prospects could be materially and adversely affected.

Risks Related to Our Operations and Business Strategy

Our business is dependent on the successful delivery, installation, commissioning, and operation of our initial 15-TPD waste conversion system at our Midland, Texas facility.

We have not yet commenced commercial operations at our Midland, Texas facility, and our near-term business plan is substantially dependent on the successful delivery, installation, commissioning, and operation of our initial 15 tons-per-day waste conversion system and related distillation equipment. As of December 31, 2025, the equipment had arrived at a U.S. port but had not yet cleared customs or been delivered to the Midland site, and approximately $653,000 in related payments were classified as a capital advance on our balance sheet pending transfer of control. Any delays in customs clearance, transportation, site preparation, installation, or commissioning, or any performance shortfalls relative to specifications, could delay our ability to begin generating operating revenue, increase our capital requirements, and have a material adverse effect on our business and financial condition.

Our business plan depends on a single planned facility, and any disruption at that facility could materially harm our business.

Our near-term operations are concentrated at our Midland, Texas site. Until we develop additional facilities, any event affecting our Midland site — including equipment failures, construction or commissioning delays, permitting delays, adverse weather, labor disputes, fires, or casualty losses — could disrupt our entire operating plan. We do not yet have the operational diversity to mitigate single-site risk.

Our waste conversion technology has not been demonstrated at commercial scale within our operations, and performance at scale may differ from expectations.

While the thermal conversion technology we are deploying has been used in similar applications, our specific configuration at Midland has not yet been operated at commercial scale by us. Actual performance — including feedstock throughput, product yields, product quality, energy efficiency, emissions levels, and maintenance requirements — may differ materially from our expectations. Any significant shortfall in operational performance could delay revenue generation, increase operating costs, require capital modifications, or adversely affect our ability to secure offtake agreements and regulatory approvals.

We depend on a consistent and economical supply of waste tire and plastic feedstock.

Our revenue and operating model depend on securing a reliable supply of waste tires and plastics at economical cost. As of the date of this Annual Report, we have not entered into binding long-term feedstock supply agreements. Our ability to source feedstock is subject to risks including fluctuations in the volume, composition, and quality of available waste; competition from recycling programs, landfill operators, and other waste conversion companies; changes in municipal waste management contracts or tipping fee structures; and transportation and logistics costs. A failure to secure adequate feedstock, or feedstock that meets our technical specifications, could materially reduce our operating capacity, product yields, and revenues.

Our financial results will be affected by commodity price fluctuations for our products.

Our revenues will depend in part on prices we receive for tire-derived oil, refined fuel products, recovered carbon black, and recovered steel, each of which is subject to commodity price volatility driven by global energy markets, industrial demand, and competition from alternative products. A material decline in prices for any of these products, or unfavorable terms on offtake or supply arrangements, could adversely affect our revenues and profitability.

We have not finalized material offtake agreements for our products.

As of the date of this Annual Report, we have not finalized any material offtake agreements for tire-derived oil, recovered carbon black, recovered steel, or related products, although we have entered into preliminary arrangements subject to output laboratory results. If we are unable to secure offtake agreements on commercially reasonable terms, we may be unable to monetize our products as planned, which could have a material adverse effect on our business and financial condition.

Our revenues from environmental credit monetization are speculative and subject to significant uncertainty.

A portion of our planned revenue is expected to come from the monetization of carbon credits, plastic credits, and other environmental incentives. The markets for these credits are evolving, fragmented, and subject to significant regulatory, market, and certification risks. We may be unable to qualify for, generate, or monetize environmental credits on the terms or in the amounts we anticipate, which could adversely affect our business model and projected returns.

Risks Related to Regulation and Compliance

Our operations are subject to extensive environmental, health, safety, and permitting requirements, and failure to comply could materially adversely affect our business.

Our planned operations are subject to extensive federal, state, and local laws and regulations governing air emissions, waste handling, scrap tire storage, worker safety, transportation, and facility operations, including the Clean Air Act, the Resource Conservation and Recovery Act, OSHA requirements, and state and local regulations administered in Texas by the Texas Commission on Environmental Quality (“TCEQ”). Regulatory requirements applicable to waste conversion are complex and evolving. Changes in environmental laws or regulations — particularly those related to greenhouse gas emissions, waste classification, or the regulatory treatment of waste-to-energy — could require significant capital expenditures or operational modifications. Failure to obtain, maintain, or renew required operating permits could result in fines, penalties, facility shutdowns, or inability to expand, any of which could have a material adverse effect on our business.

We have not yet obtained all permits and approvals required to commence commercial operations at Midland.

As of the date of this Annual Report, we have not obtained all permits and approvals required to commence commercial operations at the Midland facility. Permitting processes can be time-consuming, costly, and subject to objection or denial. Any delay or inability to obtain required permits would delay our ability to begin generating revenue and could materially adversely affect our business.

Risks Related to Our Common Stock and Capital Structure

The conversion features of our outstanding convertible notes, including variable conversion prices tied to our trading price, could result in substantial dilution to our stockholders and depress the market price of our common stock.

As of December 31, 2025, we had outstanding convertible notes payable with an aggregate principal balance of approximately $970,000, as well as other obligations that may be settled in shares of our common stock. A significant portion of these convertible notes contain variable conversion features that allow the holder, beginning six months after issuance, to convert all or a portion of the outstanding principal and accrued interest into shares of our common stock at a conversion price equal to 60% of the lowest trading price of our common stock during the twenty trading days preceding conversion. Other outstanding notes are convertible at fixed prices as low as $0.025 to $0.20 per share.

Because the number of shares issuable upon conversion of notes with variable conversion features is determined by reference to our trading price at the time of conversion, the lower our stock price at the time of conversion, the more shares we will be required to issue. As a result:

Our outstanding convertible notes also include original issue discounts and default provisions that could materially increase the obligations payable by us, including in shares of our common stock. We are party to a convertible loan agreement under which an event of default would result in a 30% increase in the outstanding balance and a conversion price of $0.025 per share. Other notes carry default interest rates as high as 22%. Events of default could accelerate repayment obligations or significantly increase share issuances.

Our authorized capital consists of 400,000,000 shares of common stock, of which 149,220,840 were issued and outstanding as of the date of this Annual Report. If our stock price declines materially, the number of shares issuable upon conversion of our outstanding convertible notes, together with shares issuable under outstanding stock options, warrants, and stock subscription obligations, could approach or exceed our authorized share capital. Any required increase in authorized capital would require stockholder approval, which we may not be able to obtain on a timely basis, or at all. Our inability to issue shares upon conversion when required could result in events of default under the applicable notes, with the consequences described above.

As of December 31, 2025, we had approximately $1.8 million recorded as a derivative liability on our consolidated balance sheet, reflecting the fair value of the embedded conversion features of certain of these notes. For the year ended December 31, 2025, we recorded a gain of $385,493 related to the change in fair value of derivative liabilities. Changes in the fair value of this derivative liability will continue to affect our reported results of operations. For additional information, see Notes 8 and 9 to our consolidated financial statements included in this Annual Report.

We are authorized to issue up to 400,000,000 shares of common stock, of which 149,220,840 were issued and outstanding as of the date of this Annual Report. Our Board of Directors has the authority to issue additional shares of common stock without the consent of our stockholders. Consequently, stockholders may experience further dilution as we raise capital, compensate service providers, or otherwise issue equity. If outstanding stock options, warrants, or convertible notes are exercised or converted, we will be required to issue additional shares, which will result in further dilution. See also the risk factor titled “The conversion features of our outstanding convertible notes, including variable conversion prices tied to our trading price, could result in substantial dilution…” above.

Our common stock is considered a “penny stock,” which limits its marketability.

Our common stock is considered a “penny stock” under SEC Rule 15g-9, which generally defines “penny stock” as any equity security with a market or exercise price of less than $5.00 per share, subject to certain exceptions. The penny stock rules impose additional sales practice requirements on broker-dealers who sell such securities to persons other than established customers and accredited investors, including the delivery of a standardized risk disclosure document, disclosure of current bid and offer quotations, disclosure of broker-dealer compensation, monthly account statements, and a suitability determination with written customer agreement. These requirements may reduce trading activity in our common stock, limit the ability of broker-dealers to trade our securities, discourage investor interest, and adversely affect the liquidity and market price of our common stock.

There is a limited trading market for our common stock, and trading is subject to significant volatility.

Our common stock is quoted on the OTCQB tier of the OTC Markets Group under the symbol “WAST.” Trading in stocks quoted on the OTCQB is often thin and is characterized by wide fluctuations in trading prices, many of which are unrelated to the underlying business performance of the issuer. We cannot assure you that an active trading market for our common stock will develop or be sustained, or that the trading price of our common stock will not experience significant volatility. On May 7, 2025 the Company received a cease trade order in Canada due to the non-filing of our December 31, 2024 financial statements. We anticipate having the order removed by September 30, 2026.

Risks Related to Legal Proceedings and Related-Party Matters

We are subject to pending legal proceedings whose outcome is uncertain and could materially and adversely affect us.

As described in Item 3, “Legal Proceedings,” and Note 11 to our consolidated financial statements, LarCo Holdings, LLC filed a complaint in July 2024 in the Superior Court of the State of Arizona, Maricopa County, against Business Instincts Group, Inc. (“BIG”) and the Company. LarCo is seeking damages of $1,321,382 in the aggregate, of which $752,500 is claimed against us in connection with an uncollected invoice the Company pledged as collateral in support of a BIG loan. We intend to defend against the claim; however, the outcome cannot be predicted and any adverse ruling could result in a material monetary judgment, legal costs, and diversion of management attention.

On June 13, 2025, judgment on the loan was entered in LarCo’s favor against the Vendor and a former executive of the Company’s predecessor, and on September 17, 2025, an amended judgment was entered against those parties in the approximate amount of $1.57 million. The Company was not a party to, and has no liability under, that judgment.

On January 15, 2026, LarCo filed a First Verified Amended Complaint (the “Amended Complaint”) asserting claims against the Company for breach of contract, breach of the implied covenant of good faith and fair dealing, negligent misrepresentation, fraud-based claims, conversion, unjust enrichment, and aiding and abetting. As against the Company, the Amended Complaint seeks, among other things, $752,500 in respect of the pledged invoice; joint and several liability for the approximately $1.57 million judgment previously entered against the co-defendants described above; $1,875,000 asserted against all defendants in respect of certain pledged shares; punitive damages; and attorneys’ fees and costs.

Certain related-party obligations recorded on our balance sheet are disputed and subject to ongoing review.

As described in Note 13 to our consolidated financial statements, as of December 31, 2025, we had recorded accounts payable and accrued expense balances in the aggregate amount of $672,524 in connection with BIG and Cameron Chell, our former Executive Chairman. The entire aggregate balance is currently disputed, and we are unable to confirm that the underlying obligations were properly authorized, appropriately valued, or legitimately incurred in accordance with our related-party transaction policies. In addition, we have received notice that a third party has purported to assert rights against amounts allegedly owed by us to BIG and/or Mr. Chell pursuant to a judgment against them. We dispute the validity and enforceability of any such third-party claim. The outcome of these matters is uncertain, and an adverse resolution could result in a material cash payment, share issuance, or legal costs.

Risks Related to Internal Controls and Governance

We have identified material weaknesses in our internal control over financial reporting, and failure to remediate them could result in misstatements in our financial statements.

As described in Item 9A, “Controls and Procedures,” management has identified material weaknesses in our internal control over financial reporting, including the lack of a fully integrated financial reporting system and insufficient segregation of duties and technical accounting resources. As a result of these material weaknesses, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were not effective as of December 31, 2025. Material weaknesses could result in material misstatements in our financial statements that may not be detected on a timely basis, could cause us to fail to meet our reporting obligations, and could cause investors to lose confidence in our reported financial information, any of which could adversely affect the market price of our common stock. Remediation will require significant time, effort, and financial resources, and we cannot be certain that our remediation efforts will be successful.

Our success depends on the continued service of key personnel.

During the year ended December 31, 2025 we recognized total revenue of $424,167, coming from consulting services and raw material fees. We recognized no revenue for the year ended December 31, 2024.

We incurred general and administrative expenses of $662,621 and $1,194,309 for the year ended December 31, 2025 and 2024, respectively, representing a decrease of $531,688 between the two periods. These expenses consisted primarily of stock-based compensation, consulting fees, pre-licensing fees, professional fees, and other general and administrative costs. The decrease in general and administrative expenses was mainly due to the decrease in platform development and advertising and marketing expenses in 2025.

Other income (expenses) was $(710,819) and ($131,588) for the year ended December 31, 2025 and 2024, respectively, mainly consisting of loss on issuance of debt, interest expense from the loan payable, changes in derivative liability, and gain on debt settlement.

Current assets on December 31, 2025, were comprised of only cash and cash equivalents of $68,244, accounts receivable, net of $7,500, prepaid rent of $12,000 and a security deposit of $12,000.

On December 31, 2025, current liabilities were comprised of accounts payable and accrued expenses of $1,497,767 (related and unrelated parties), notes payable, net $117,000, convertible notes payable $857,353, derivative liability of $1,828,934, lease liability of $135,000, deferred revenue of $83,333 and deposits payable of $77,700.

There was no net cash used or provided by discontinued operations for the year ended December 31, 2025 or 2024.

Investing Activities

Net cash used in investing activities was $653,250 for the year ended December 31, 2025, compared to nil for the same period in 2024, an increase of $653,250. This increase was attributable to payments made to acquire a waste-to-energy machine. As of December 31, 2025, the company has not obtained custody of the machine, its construction is not complete, nor does the company have control, the amount is therefore held as a deposit made for capital advance.

The financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

During the three and six months ended June 30, 2026 we recognized total revenue of $22,500 and $125,000 for the three months ended June 30, 2026 and 2025, respectively, and $105,833 and $166,667 for the six months ended June 30, 2026 and 2025, respectively, generated from our waste conversion business, primarily from consulting services.

Net cash provided by financing activities was $455,060 for the six months ended June 30, 2026, compared to $296,978 for the six months ended June 30, 2025. The cash provided during the six months ended June 30, 2026 was primarily due to the issuance of new convertible debentures of $716,000 offset by $260,940 in repayments. The cash provided during the six months ended June 30, 2025 was due to $150,000 from proceeds of stock to be issued, $225,000 in proceeds from convertible notes, less $78,022 in repayments to notes payable and convertible notes.