Karbon-X Amends 10-K, Details $1.7M Share Sale, App Launch

Ticker: KARX · Form: 10-K/A · Filed: Sep 17, 2025 · CIK: 1729637

Sentiment: bearish

Topics: Carbon Credits, ESG, Voluntary Carbon Market, 10-K/A, Share Dilution, Startup Risk, Environmental Technology

TL;DR

**KARX is burning cash to grow in a hyper-competitive carbon market, and investors should be wary of future dilution despite the recent capital raise.**

AI Summary

Karbon-X Corp. (KARX) filed a 10-K/A on September 17, 2025, primarily to add inadvertently omitted Inline XBRL exhibits to its Annual Report for the fiscal year ended May 31, 2025. The company, a Nevada corporation, focuses on the voluntary carbon credit market, offering certified carbon credits to corporations and the general public through an APP. During the fiscal year, Karbon-X sold 1,926,742 shares at $0.90 per share, generating $1,712,099 in proceeds. It also converted a $350,000 loan plus $16,724 interest into 407,471 shares at $0.90 per share on March 31, 2025. Additionally, 57,875 shares were issued for compensation totaling $118,007 at $2.04 per share. The company completed its proprietary mobile APP in March 2025, enabling subscription-based carbon offset sales. Karbon-X faces intense competition from established players like Indigo Carbon, Nori, and Carbon Streaming Corp., and acknowledges the risk of incurring losses and the potential need for additional capital to sustain operations.

Why It Matters

This 10-K/A provides crucial transparency regarding Karbon-X's financial activities and operational developments, particularly the $1.7 million raised from share sales and the launch of its carbon offset mobile app in March 2025. For investors, it highlights the company's capital-raising efforts and its strategy to engage both corporate and retail markets in the competitive carbon credit space. Employees benefit from the company's growth and active recruitment, while customers gain insight into the subscription models for carbon offsetting. The broader market sees Karbon-X's positioning against major competitors like Indigo Carbon and Nori, underscoring the increasing competition and innovation in the voluntary carbon market.

Risk Assessment

Risk Level: high — Karbon-X explicitly states, "We will incur losses and there is no guarantee that we will ever become profitable," indicating significant operational risk. The company also notes, "We may need additional capital in the future in order to continue our operations," despite raising $1,712,099 from share sales, suggesting ongoing liquidity concerns and potential for further shareholder dilution.

Analyst Insight

Investors should exercise extreme caution and thoroughly evaluate Karbon-X's path to profitability and capital requirements. Given the stated risk of incurring losses and the potential need for additional capital, new investments carry a high risk of dilution and capital loss. Monitor future filings for signs of sustained revenue growth and reduced reliance on equity financing.

Key Numbers

Key Players & Entities

FAQ

Why did Karbon-X Corp. file a 10-K/A?

Karbon-X Corp. filed Amendment No. 1 to its Annual Report on Form 10-K solely to add exhibits that were inadvertently omitted from the Original Report, specifically the Company's Inline XBRL exhibits.

What is Karbon-X Corp.'s primary business?

Karbon-X Corp. is a public Nevada corporation that offers investors exposure to certified carbon credits, focusing on partnering with high-quality projects and companies involved in the voluntary carbon credit market to help individuals and corporations achieve carbon neutral and net-zero goals.

How much capital did Karbon-X Corp. raise from share sales?

During the fiscal year ended May 31, 2025, Karbon-X Corp. sold 1,926,742 shares at $0.90 per share, generating total proceeds of $1,712,099.

When did Karbon-X Corp. launch its mobile APP?

The Karbon-X APP was soft-launched in 2023 and was completed and made publicly available in March 2025, offering subscription-based carbon offset sales to the general public.

Who are Karbon-X Corp.'s main competitors?

Karbon-X Corp. faces competition from several key players in the carbon credit industry, including Indigo Carbon, Nori, TruCarbon by TruTerra, Bayer Carbon Initiative, Nutrien Ag, Carbon Streaming Corp, Base Carbon, and Climeworks.

What are the main risks for Karbon-X Corp. investors?

Investors face a high degree of risk, including the company's explicit statement that it "will incur losses and there is no guarantee that we will ever become profitable," and the potential need for additional capital in the future, which could lead to significant shareholder dilution.

What was the aggregate market value of Karbon-X Corp.'s non-affiliate common equity?

The aggregate market value of the voting and non-voting common equity held by non-affiliates as of August 31, 2025, was $32,131,927.

How many employees does Karbon-X Corp. have?

As of the date of the 10-K filing, Karbon-X Corp. has twenty-five employees and is actively recruiting new team members at all levels of the organization.

What was the purpose of the Asset Purchase Agreement with Allcot AG?

On June 1, 2025, Karbon-X Corp. entered into an Asset Purchase Agreement with Allcot AG to acquire specified assets, including certain subsidiary shares, intellectual property, database, project pipeline, and contract rights, for a cash consideration of $350,000.

What types of sales does Karbon-X Corp. engage in?

Karbon-X Corp.'s main revenue streams include industrial sales of carbon offsets to companies in sectors like mining and oil and gas, and subscription-based sales to the general public through its mobile APP.

Risk Factors

Industry Context

Karbon-X Corp. operates in the rapidly growing voluntary carbon credit market, driven by corporate ESG commitments and net-zero targets. The industry is characterized by a focus on verified emissions reductions and increasingly sophisticated platforms for credit trading. However, it faces intense competition from established players and is subject to evolving verification standards and market dynamics.

Regulatory Implications

As a participant in the carbon credit market, Karbon-X Corp. is subject to regulations governing carbon accounting, verification standards, and financial reporting. The inadvertent omission of Inline XBRL exhibits in its initial 10-K filing highlights the importance of meticulous compliance with SEC reporting requirements.

What Investors Should Do

  1. Monitor profitability and cash flow generation closely.
  2. Assess the impact of the APP launch on revenue and customer acquisition.
  3. Evaluate the competitive positioning against larger players.
  4. Track future capital raising activities and their terms.

Key Dates

Glossary

Voluntary Carbon Credit Market
A market where companies and individuals can purchase credits representing the removal or reduction of greenhouse gas emissions, used to meet voluntary climate goals. (This is the core market in which Karbon-X Corp. operates and generates its revenue.)
Inline XBRL
An eXtensible Business Reporting Language format that embeds XBRL data directly within an HTML document, making financial data more accessible and machine-readable. (The 10-K/A filing was primarily to add these exhibits, highlighting the company's compliance with modern financial reporting standards.)
Verified Emissions Reduction (VER)
A unit representing one metric ton of carbon dioxide equivalent that has been verifiably reduced or removed from the atmosphere. (These are the products Karbon-X Corp. aims to sell through its platform.)
Cashless Exercise
A method of exercising stock options or warrants where the option holder does not pay cash for the shares, but instead uses the value of the shares being issued to cover the exercise cost and any taxes. (The company utilized this method for option and warrant exercises, impacting the number of shares outstanding without immediate cash inflow.)
Asset Purchase Agreement
A contract detailing the sale and purchase of specific assets from one company to another. (Karbon-X Corp. entered into such an agreement to acquire assets from Allcot AG, indicating strategic growth.)

Year-Over-Year Comparison

This filing is an amendment (10-K/A) to the original 10-K, primarily to correct an omission of Inline XBRL exhibits. Therefore, a direct comparison of key financial metrics to a prior year's filing is not possible based on this amendment alone. The provided context focuses on the fiscal year ended May 31, 2025, detailing share issuances, loan conversions, and an asset acquisition, but lacks comparative year-over-year financial data within this specific amendment.

Filing Stats: 4,570 words · 18 min read · ~15 pages · Grade level 13.7 · Accepted 2025-09-16 21:35:58

Key Financial Figures

Filing Documents

Risk Factors

Risk Factors 7 Item 1B Unresolved Staff Comments 10 Item 1C Cybersecurity Risk 10 Item 2. Description of Property 11 Item 3.

Legal Proceedings

Legal Proceedings 11 Item 4. Submission of Matters to a Vote of Security Holders 12 Item 5. Market for Common Equity and Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities 12 Item 6.

Selected Financial Data

Selected Financial Data 13 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operation

Management's Discussion and Analysis of Financial Condition and Results of Operation 13 Item 8.

Financial Statements

Financial Statements 19 Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosures 20 Item 9A.

Controls and Procedures

Controls and Procedures 20 Item 9B. Other Information 20 Item 10. Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance with Section 16(a) of the Exchange Act 20 Item 11.

Executive Compensation

Executive Compensation 22 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 23 Item 13. Certain Relationships and Related Transactions, and Director Independence. 25 Item 14. Principal Accountant Fees and Services 25 Item 15. Exhibits 26 2 Table of Contents Explanatory Note This Amendment No. 1 (the "Amendment") to the Company's Annual Report on Form 10-K for the year ended May 31, 2025, filed with the Securities and Exchange Commission on September 15, 2025 (the "Original Report"), is being filed solely to add exhibits that were inadvertently omitted from the Original Report, including the Company's Inline XBRL exhibits. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION This Annual Report on Form 10-K, the other reports, statements, and information that we have previously filed or that we may subsequently file with the Securities and Exchange Commission, or SEC, and public announcements that we have previously made or may subsequently make include, may include, incorporate by reference or may incorporate by reference certain statements that may be deemed to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to enjoy the benefits of that act. Unless the context is otherwise, the forward-looking statements included or incorporated by reference in this Form 10-K and those reports, statements, information and announcements address activities, events or developments that Karbon-X Corp. (hereinafter referred to as "we," "us," "our," "our Company" or "Karbon-X") expects or anticipates, will or may occur in the future. Any statements in this document about expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. These statements are often, but not always, made through the use of words or phrases such as "may," "should," "could," "predict," "pot

Description of Business

Item 1. Description of Business Karbon-X Corp (or "Karbon-X" or "the Company") is a public Nevada corporation that offers investors exposure to certified carbon credits which are a key instrument used by both individuals and corporations to achieve their carbon neutral and net-zero carbon goals. The company is environmental, social and governance (ESG) principled and focuses on partnering with high-quality projects and/or companies that generate or are actively involved in the voluntary carbon credit market. Karbon-X Corp is focused on customized transactional options for corporations to offset their carbon footprint and provides scalable access to the Verified Emissions Reduction markets. Karbon-X is changing the marketing framework of traditional carbon marketing by engaging with the public in order to fund multiple forms of technology-based greenhouse gas reduction builds. Carbon Credit Generation Karbon-X Corp has begun purchasing verified carbon credits from numerous vendors and intends to resell these credits to both industry and the general public. The Company has already begun funding projects in order to generate Karbon-X Corp carbon credits of its own. Once verified these projects will generate carbon credits that will be sold on its proprietary APP platform. Developments During the year ended May 31, 2025, the Company sold 1,926,742 shares at $.90 per share for total proceeds of $1,712,099. On March 31, 2025, the Company converted a loan for $350,000 principal and $16,724 interest into 407,471 shares at a price of $.90 per share. On March 31, 2025, the Company issued 57,875 shares at $2.04 per share for compensation of $118,007. On May 22, 2025, the Company converted 360,000 options related to its stock option plan into 205,715 shares via a cashless exercise. On May 15, 2025, 10,400 warrants were exercised in a cashless exercise for 7,429 shares. On June 1, 2025, the Company entered into an Asset Purchase Agreement with Allcot AG to acq

Legal Proceedings

Legal Proceedings In February 2024, Karbon-X were notified of a former employee filing a lawsuit against the company for wrongful termination. The Company is currently counter-suing and is expecting to prevail. As of the date hereof the Company is not party to any other material legal proceedings and is not aware of any material threatened litigation.

Risk Factors

Item 1A. Risk Factors. An investment in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks described below. Our business, financial condition, results of operations and cash flows could be materially adversely affected by any of these risks, and the market or trading price of our securities could decline due to any of these risks. In addition, please read "Disclosure Regarding Forward-Looking Statements" in this Annual Report, where we describe additional uncertainties associated with our business and the forward-looking statements included or incorporated by reference in this Annual Report. Please note that additional risks not presently known to us or that we currently deem immaterial may also impair our business and operations. In this Section, the terms the "Company," "we", "our" and "us" refer to Karbon-X Corp. as well as our subsidiary Karbon-X Project, Inc. 7 Table of Contents Risks Related to Our Operations We will incur losses and there is no guarantee that we will ever become profitable. There is no guarantee that we will ever become profitable. The costs for research, product development, along with marketing and selling expenses, and the general and administrative expenses, will be principal causes of our costs and/or potential losses. We may never become profitable and if we do not become profitable your investment could be harmed or lost completely. We may need additional capital in the future in order to continue our operations. We obtained approximately $1.7 million in our recent private placements which we are using for development and operations. However, if in the future we do not turn profitable or generate cash from operations and additional capital is needed to support operations, economic and market conditions may make it difficult or impossible to raise additional funds through debt or equity financings. If funds are not sufficient to support operations,

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