ADDED
Interim Financial Statements 1 Condensed Consolidated Balance Sheets (Unaudited) 1 Condensed Consolidated Statements of Operations (Unaudited) 2 Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) (Unaudited) 3 Condensed Consolidated Statement of Cash Flows (Unaudited) 4 Notes to Condensed Consolidated Financial Statements (Unaudited) 5 Item 2.
The Company owns all of the equity and has unilateral control over Rorschach Cayman LLC ( Rorschach Cayman ) and as such consolidates the entity under ASC 810, Consolidations .
( Sonnet ), the Company, Rorschach I LLC ("Rorschach"), Sonnet Merger Sub Inc., and Rorschach Merger Sub LLC, entered into a Business Combination Agreement (as subsequently amended, the BCA ) pursuant to which, subject to the terms and conditions contained in the BCA, (i) Rorschach Merger Sub LLC would merge with and into Rorschach (the "Rorschach Merger") with Rorschach surviving the Rorschach Merger as a direct wholly owned subsidiary of the Company and (ii) immediately following the Rorschach Merger, Sonnet Merger Sub Inc.
would merge with and into Sonnet (the "Sonnet Merger"), with Sonnet surviving the Sonnet Merger as a direct wholly owned subsidiary of the Company.
The combination of Rorschach and HSI was accounted for as a reverse recapitalization (the Reverse Recapitalization ), with Rorschach surviving as the accounting acquirer.
Under the Reverse Recapitalization, the assets and liabilities of HSI were recorded at historical cost.
Consequently, the condensed consolidated financial statements of the Company reflect the operations of Rorschach for accounting purposes, and together with the financial position and results of operations of HSI and Sonnet subsequent to the Closing Date.
The overall business combination of the Company, Rorschach and Sonnet was a strategic realignment of HSI as a blockchain-focused entity, while still leveraging Sonnet s expertise for concurrent biotech operations.
Refer to Note 5 for additional information on the Company s Reverse Recapitalization and the Company's acquisition of Sonnet, the latter of which was accounted for as an asset acquisition under ASC 805, Business Combinations .
The Company s primary focus is building, managing, and optimizing its treasury with HYPE tokens, which are the native digital assets of the Hyperliquid Layer-1 blockchain.
REMOVED
Interim Financial Statements 1 Condensed Consolidated Balance Sheet (Unaudited) 1 Condensed Consolidated Statement of Operations (Unaudited) 2 Condensed Consolidated Statement of Changes in Stockholder s Deficit (Unaudited) 3 Condensed Consolidated Statement of Cash Flows (Unaudited) 4 Notes to Condensed Consolidated Financial Statements (Unaudited) 5 Item 2.
CONDENSED CONSOLIDATED BALANCE SHEET September 30, 2025 Liabilities and Stockholder s Deficit Accounts payable and accrued expenses $ 1,138,335 Due to related parties 74,586 Total Current Liabilities and Total Liabilities 1,212,921 Commitments and Contingencies Stockholder s Deficit: Common stock, $ 0.01 par value; 1,000 shares authorized; 100 shares issued and outstanding Accumulated deficit ( 1,212,921 ) Total Stockholder s Deficit ( 1,212,921 ) Total Liabilities and Stockholder s Deficit $ The accompanying notes are an integral part of these condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS For the period from July 2, 2025 (inception) through September 30, 2025 Formation and operating costs $ ( 1,212,921 ) Net loss $ ( 1,212,921 ) Basic and diluted weighted average shares outstanding 92 Basic and diluted net loss per share $ ( 13,183.92 ) The accompanying notes are an integral part of these condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDER S DEFICIT For the period from July 2, 2025 (inception) through September 30, 2025 Additional Total Paid-In Accumulated Stockholder s Shares Amount Capital Deficit Deficit Balance as of July 2, 2025 (inception) $ $ $ $ Issuance of Common Stock 100 Net loss ( 1,212,921 ) ( 1,212,921 ) Balance as of September 30, 2025 100 $ $ $ ( 1,212,921 ) $ ( 1,212,921 ) The accompanying notes are an integral part of these condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS For the period from July 2, 2025 (inception) through September 30, 2025 Cash flows from operating activities: Net loss $ ( 1,212,921 ) Changes in operating assets and liabilities: Accounts payable and accrued expenses 1,138,335 Due to related party 74,586 Net cash flows from operating activities Net change in cash Cash, July 2, 2025 (inception) Cash, September 30, 2025 $ The accompanying notes are an integral part of these condensed consolidated financial statements.
The Company was formed for the purpose of effecting a proposed Transaction (See Note 4).
The Company owns all of the equity and has unilateral control over Rorschach Cayman LLC and as such consolidates the entity under ASC 810, Consolidations.
As of September 30, 2025, the Company and its wholly owned subsidiaries, Rorschach Cayman LLC, Rorschach Merger Sub LLC and TBS Merger Sub Inc had not generated any revenues.
All activity as of September 30, 2025 relates to the Company s formation and preparation for the Transaction.
The Company will not generate any operating revenues until after the proposed Transaction, at the earliest.