UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 1-A
REGULATION A OFFERING CIRCULAR
UNDER THE SECURITIES ACT OF 1933
Entrex Production and Installation Company, Inc.
2436 N Federal HWY PMB 276
Lighthouse PT, FL 33064
Telephone: (561) 465-7454
6199
99-4553256
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification Number)
Entrex Production and Installation Company, Inc.
Maximum combined offering of $19,999,999 consisting of Class "A"
Common Stock [Quantity of Shares to be
Determined at Qualification]
Entrex Production and Installation Company, Inc. ("EPIC", "Entrex"
or the "Company") is offering a combined
maximum amount of $19,999,999 of Class "A" Common Stock ("Stock"
or "Shares on a "no minimum/best
efforts" basis (the "Offering"). The Offering will terminate on the
earlier of 12 months from the date this Offering
Circular is qualified for sale by the Securities Exchange Commission
("SEC") (which date may be extended for an
additional 90 days in our sole discretion) or the date when all
Shares have been sold. This Offering is a fixed price
offering of shares of Class "A" common stock [quantity to be
determined at time of qualification of the Regulation
A ("RegA") offering] at the fixed price of $ [shares to be priced
at time of qualification of the Reg A offering] per
share for a total offering amount up to $19,999,999. The Company
intends to file ongoing "current information" as
that term is defined by the Securities Act, in order to continue
to trade publicly and to remain current in its required
periodic filings. This Offering is being made directly by the
Company and is not currently being offered through an
underwriter or broker dealer. As a result, the Company does not
anticipate incurring or paying any sales
commissions to any third parties for the sale of this Offering.
The Entrex Production and Installation Company's mission is to buy
fully assembled and operational Bitcoin mining
facilities from development partners. This strategic approach
mitigates risks and leverages the expertise of partners
who have previously managed and facilitated roll-ups of diversified
industries. EPIC's innovative model not only
addresses significant pain points in both industries but also offers
substantial financial returns and environmental
benefits through carbon offsets. Additionally, Entrex Carbon Market
focuses on the potential securitization of
debt/equity for EPIC and the sale of securitized carbon offsets,
positioning the organization to leverage both
environmental and financial markets.
This Offering is being conducted on a "best efforts" basis, with
no minimum. The following illustrates certain
important information regarding the sale of this Offering.
Price to
public
Underwriting
discount or
commissions1
Proceeds to
Issuer2
Proceeds to
other
persons
Per
Share/Unit
$
TBD
$
0
$
TBD
$
0
Total
Minimum
$
0
$
0
$
0
$
0
Total
Maximum
$
TBD
$
1,999,999
$
18,000,000
$
0
Footnotes to table:
1. The Company is offering the Shares in this non-public
offering on a "best efforts" basis solely through the
Company's officers and directors. The Company's officers and
directors are not entitled to receive any
discounts or commissions for selling such Shares, but may be
reimbursed for reasonable expenses they incur, if
any.
2. If the Offering is consummated and all Shares offered are
hereby sold, the gross proceeds from the sale of those
Shares at $[to be priced at time of qualification of the Reg A
offering] would be $19,999,999 and the net
proceeds would be approximately $19,949,999, after giving effect
to estimated expenses in connection with the
Offering of approximately $50,000, including, but not limited to,
printing and copying costs, legal fees,
accounting fees, filing fees, postage, and other miscellaneous
costs and expenses, including meeting expenses.
Notwithstanding the foregoing, the Company can provide no
assurances as to the total number of Shares that
may be sold or the amount of expenses to be paid.
For further information about the Stock being sold in this Offering
please see the section named The Offering on
page 3 below and the section named Terms of the Offering on page 10
below.
This Offering is made pursuant to Tier 1 of Regulation A+ of the
Securities Act of 1933.
This Offering is a highly speculative investment and involves a high
degree of risk. As a result, this Offering should
only be considered by persons who can afford to lose their entire
investment.
FOR MORE INFORMATION ABOUT THE RISKS ASSOCIATED WITH THIS OFFERING,
PLEASE REVIEW
THE "RISK FACTORS" ON PAGES 3 THROUGH 6 OF BELOW.
THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE
MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFEREED OR THE TERMS OF THE
OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING
CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED
PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER,
THE COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE
SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.
NEITHER THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (THE
"COMMISSION"), NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR
DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF
THIS OFFERING CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
Proceeds from the Offering shall be released to the Company when received
and no escrow shall be created for this
offering. The Company will pay all of the expenses of the Offering.
THIS OFFERING CIRCULAR FOLLOWS THE OFFERING CIRCULAR FORMAT DESCRIBED IN
PART II OF SEC FORM 1-A.
The estimated offering expenses of $50,000 include printing and copying
costs of $3,000, legal fees of $40,000,
accounting fees of $5,000, transfer agent fees of $1,000 and miscellaneous
costs and expenses, including potential
travel and entertainment expense for potential investor meetings. All of
these expenses are estimates only and the
actual offering expenses may be higher or lower than anticipated.
Once a subscriber's subscription agreement has been received by the Company,
it may not be revoked. All proceeds
from the sale will be immediately provided to the Company.
ALL FUNDS SHALL BE RELEASED TO THE COMPANY AS THIS OFFERING IS SOLD. NO
MINIMUM
AMOUNT MUST BE RAISED BEFORE THE OFFERING IS CLOSED. THE PRINCIPAL PURPOSE
OF THIS
OFFERING IS TO FUND EPIC'S MINING ACQUISITION PROJECTS.
Possible subscribers should only rely on the information contained in this
Offering Circular when making a
decision to purchase the Shares. No one else is authorized to provide possible
subscribers with different
information. The Company is not offering to sell nor soliciting an offer to
buy the Shares in any state or to
any person where the offer or solicitation is prohibited.
PROSPECTIVE INVESTORS ARE NOT TO CONSTRUE THE CONTENTS OF THIS OFFERING
CIRCULAR AS LEGAL, BUSINESS OR TAX ADVICE. EACH PROSPECTIVE INVESTOR SHOULD
CONSULT HIS, HER OR ITS OWN ATTORNEY, BUSINESS ADVISER AND TAX ADVISER AS TO
LEGAL, BUSINESS, TAX AND RELATED MATTERS CONCERNING THE SHARES.
ITEM 2. TABLE OF CONTENTS
SUMMARY
1
REGULATION A+
2
THE OFFERING
2
RISK FACTORS
3
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
6
DILUTION
6
PLAN OF DISTRIBUTION
7
USE OF PROCEEDS
7
TERMS OF THE OFFERING
7
BUSINESS
8
DESCRIPTION OF PROPERTY
9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
9
DIRECTORS, EXECUTIVE OFFIDERS AND SIGNIFICANT EMPLOYEES
11
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
12
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS
13
INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
13
SECUITIES BEING OFFERED
13
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
14
ADDITIONAL INFORMATION
15
This summary highlights information contained elsewhere in this Offering
Circular and is qualified in its entirety by
the more detailed information and financial statements appearing elsewhere
or incorporated by reference in this
Offering Circular. This summary does not contain all of the information
that you should consider before deciding to
invest in our securities. You should read this entire Offering Circular
carefully, including the "Risk Factors"
section, our historical consolidated financial statements and the notes
thereto, and unaudited pro forma financial
information, each included elsewhere in this Offering Circular. Unless the
context requires otherwise, references in
this Offering Circular to "the Company," "we," "us" and "our" refer to
Entrex Production and Installation
Company, Inc.
SUMMARY
This summary highlights information contained elsewhere in this offering
circular. This summary does not contain
all of the information that you should consider before deciding whether
to invest in Shares or Redeemable Preferred
Stock. You should carefully read this entire offering circular, including
the information under the heading "Risk
Factors" and all information included in this offering circular.
Issuer.
Entrex Production and Installation Company, Inc. was incorporated in the
State of Florida on August 15, 2024. Our
principal executive offices are located at 150 East Palmetto Park Road,
Suite 800, Boca Raton, FL 33432.
The Entrex Production and Installation Company's mission is to buy
operational Bitcoin mining facilities from
development partners. This strategic approach mitigates risks and
leverages the expertise of partners who have
previously managed and facilitated roll-ups of diversified industries.
EPIC's innovative model not only addresses
significant pain points in both industries but also offers substantial
financial returns and environmental benefits
through carbon offsets.
The company has four units to purchase which will have third party confirmed
net income in the fourth quarter
2024. These units are the first facilities to be purchased of the 16
scheduled for delivery and "Proof of Income"
confirmation in Q4 2024. The historical trailing twelve-month net income,
as represented by the sellers, for the
initial projects are:
Facility 1: $105,000
Facility 2: $200,363
Facility 3: $449,000
Facility 4: $105,000
Capital needed for these projects is anticipated to be $3,500,000
A total of 300 sites has been contracted for
delivery from three independent developers. The Company has contracted
to purchase several operational Bitcoin
mining facilities, each consisting of state-of-the-art equipment. Specifically,
the facilities include Bitmain Antminer
S21 miners, or other agreed equipment. The first four units include 25 miners
each, aged less than one year, with a
performance efficiency of 34 joules per terahash (J/TH). Units 5-16 contain
a similar number of miners, and units
17-300 will also consist mainly of Bitmain Antminer S21 equipment and/or
other equipment elected and agreed for
its bitcoin mining capabilities. These miners are known for their reliability,
energy efficiency, and performance in
large-scale operations. The expected delivery of the first group of mining
facilities (units 1-4) is scheduled for Q4
2024. Units 5-16 are set for delivery in Q1 2025, while units 17-300 will be
delivered in phases throughout 2025
and 2026. The delivery schedules are coordinated with our developers to
ensure timely deployment and setup
dependent on financing availability.
The Company has entered into agreements with three developers, including
CherAmi Digital LLC, Moria Mining
Technologies, and PickAxe Mining Inc. The purchase price for each facility
is calculated in advanced based on 4x
their projected annual net income, as verified by third-party audits once
the units are operational. These agreements
include obligations for the developers to deliver fully operational Bitcoin
mining facilities at designated stranded gas
well sites. Each developer is also responsible for providing the necessary
support during the setup phase
The Company is an "emerging growth company," as defined in the Jumpstart
Our Business Startups Act of 2012
(the "JOBS Act").. and, for so long as we are an emerging growth company,
are eligible to take advantage of certain
exemptions from various reporting requirements that are applicable to other
public companies that are not emerging
growth companies. These include, but are not limited to:
?
Not being required to comply with the auditor attestation requirements
in the assessment of our internal
control over financial reporting;
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Not being required to comply with any requirement that may be adopted
by the Public Company
Accounting Oversight Board regarding mandatory audit firm rotation or
a supplement to the auditors'
report providing additional information about the audit and the
financial statements;
?
Reduced disclosure obligations regarding executive compensation; and
?
Exemptions from the requirements of holding a nonbinding advisory vote
on executive compensation and
stockholder approval of any golden parachute payments not previously
approved.
We may remain an "emerging growth company" until as late as the fiscal
year-end following the fifth anniversary of
the completion of our IPO, though we may cease to be an emerging growth
company earlier under certain
circumstances, including if (a) we have more than $1.07 billion in annual
revenue in any fiscal year, (b) the market
value of our common stock that is held by non-affiliates exceeds $700
million as of any June 30 or (c) we issue
more than $1.0 billion of non-convertible debt over a three-year period.
In addition, Section 107 of the JOBS Act provides that an emerging
growth company can take advantage of the
extended transition period provided in Section 7(a)(2)(B) of the
Securities Act of 1933, as amended (the "Securities
Act"), for complying with new or revised accounting standards. In
other words, an emerging growth company can
delay the adoption of certain accounting standards until those
standards would otherwise apply to private
companies.
The Company is offering Class 'A' Common Stock in a Regulation A
offering for a period of 12 months, with an
option to extend the offering by an additional 90 days at the Company's
discretion. The offering will remain open
until the earlier of (i) the sale of the maximum number of shares offered,
or (ii) the expiration of the offering period,
including any extension."
REGULATION A+
We are offering our Shares and Shares pursuant to recently adopted
rules by the SEC mandated under the Jumpstart
Our Business Startups Act of 2012, or the JOBS Act. These offering
rules are often referred to as "Regulation A+."
We are relying upon "Tier 1" of Regulation A+, which allows us to
offer of up to $20 million in a 12-month period.
In addition to qualifying a Regulation A offering with the SEC, we
must register or qualify the Tier 1 offering in any
state in which we seek to offer or sell securities pursuant to
Regulation A.
THE OFFERING
Class "A" Common
Stock
We are offering shares of Class "A" Common Stock [quantity and
pricing to be determined
at Reg A offering qualification].
Use of Proceeds
We estimate that the net proceeds we will receive from this offering
will be approximately
$19,999,999 if all Shares are sold.
We plan to use the majority of the net proceeds from this offering to
fund the acquisition of
mining operations and to support key EPIC projects that are integral
to our business
strategy. Any remaining funds will be used to support existing
operations, hire new
personnel, and finance sales, marketing, and other revenue-generating
initiatives, as well as
for working capital.
Liquidity:
This is a Tier 1, Regulation A offering where the offered securities
will not be listed on a
registered national securities exchange upon qualification. This
offering is being conducted
pursuant to an exemption from registration under Regulation A of the
Securities Act of
1933, as amended. After qualification, we may apply for these qualified
securities to be
eligible for quotation on an alternative trading system or over-the-
counter market, if we
determine that such a market is appropriate given the structure of
the Company and our
business objectives.
Risk Factors:
An investment in the Shares involves certain risks. You should
carefully consider the risks
above, as well as other risks described under "Risk Factors" in this
offering circular before
making an investment decision.
RISK FACTORS
This offering is being made pursuant to Regulation A under the Securities
Act of 1933, as amended. This offering is
not registered under the Securities Act, nor is it required to be.
Potential investors should carefully read this offering
circular before making any investment decision. The securities
described herein are not FDIC-insured, and investors
should be prepared to lose their entire investment.
Investing in our Shares involves a high degree of risk. You should
carefully consider each of the following risks,
together with all other information set forth or incorporated by
reference in this Offering Circular, including, but
not limited to, the consolidated financial statements and the related
notes, before making a decision to buy our
securities. If any of the following risks actually occur, our
business could be harmed.
RISK FACTORS REGARDING OUR COMPANY AND BUSINESS
Investments in small businesses and start-up companies are often risky.
Small businesses may depend heavily upon a single customer,
supplier, or employee whose departure would
seriously damage the company's profitability. The demand for the
Company's product may be seasonal or be
impacted by the overall economy, or the company could face other
risks that are specific to its industry or type of
business. The Company may also have a hard time competing against
larger companies who can negotiate for better
prices from suppliers, produce goods and services on a large scale
more economically, or take advantage of bigger
marketing budgets. Furthermore, a small business could face risks
from lawsuits, governmental regulations, and
other potential impediments to growth.
The Company has limited operating history.
The Company is still in an early phase and is just beginning to
implement its business plan. There can be no
assurance that it will ever operate profitably. The likelihood
of its success should be considered in light of the
problems, expenses, difficulties, complications, and delays usually
encountered by companies in their early stages of
development, with low barriers to entry. The Company may not be
successful in attaining the objectives necessary
for it to overcome these risks and uncertainties.
We are a development stage business and may be adversely affected
managing the business and regulatory
challenges of the market sector.
The Company has limited capitalization and lacks sufficient working
capital to execute its business plan, making it
highly dependent on raising funds to grow and expand its operations.
The ability to move forward with the
Company's objectives, which include acquiring and managing mobile
Bitcoin mining facilities powered by stranded
natural gas wells, is contingent upon the success of this and other
capital offerings. These offerings are crucial for
funding the acquisition and deployment of these facilities, as
well as for covering operational expenses. Should we
fail to obtain sufficient working capital through this offering,
the Company may be forced to abandon or
significantly delay its business plan, including the deployment
of these energy-efficient mining facilities.
The Company may need additional capital, which may not be
available.
Due to market conditions at the time the Company may need
additional funding, or due to its financial condition at
that time, it is possible that the Company will be unable to
obtain additional funding as and when it needs it. If the
Company is unable to obtain additional funding, it may not be
able to repay debts when they are due and payable. If
the Company is able to obtain capital, it may be on unfavorable
terms or terms which excessively dilute then-
existing equity holders. If the Company is unable to obtain
additional funding as and when needed, it could be
forced to delay its development, marketing, and expansion efforts
and, if it continues to experience losses,
potentially cease operations.
We are dependent on the sale of our securities to fund our operations
and will remain so until we generate
sufficient revenues to pay for our operating costs:
Our officers and directors have made no written commitments with respect
to providing a source of liquidity in the
form of cash advances, loans and/or financial guarantees. There can be no
guarantee that we will be able to
successfully sell our securities. Such liquidity and solvency problems ma
y force the Company to cease operations if
additional financing is not available. No known alternative resources of
funds are available in the event we do not
generate sufficient funds from operations.
The Company's management has broad discretion in how the Company use the
net proceeds of an offering.
The Company's management will have considerable discretion over the use
of proceeds from their offering. You
may not have the opportunity, as part of your investment decision, to
assess whether the proceeds are being used
appropriately.
The Company may not be able to manage its potential growth.
For the Company to succeed, it needs to experience significant expansion.
There can be no assurance that it will
achieve this expansion. This expansion, if accomplished, may place a
significant strain on the Company's
management, operational and financial resources. To manage any material
growth, the Company will be required to
implement operational and financial systems, procedures and controls. It
will also be required to expand its finance,
administrative and operations staff. There can be no assurance that the
Company's current and planned personnel,
systems, procedures and controls will be adequate to support its future
operations at any increased level. The
Company's failure to manage growth effectively could have a material
adverse effect on its business, results of
operations and financial condition.
The Company faces significant competition in the Bitcoin mining industry.
We compete with other companies in the Bitcoin mining industry, many of
which have access to cheaper energy
sources or more advanced technology. If the market favors these
competitors, we may experience reduced
profitability, which could adversely affect our ability to continue
operations.
The Company relies on partners and related entities for the acquisition
and deployment of Bitcoin mining
facilities.
If our partners or related entities encounter significant challenges or
fail to fulfill their contractual obligations, our
operations could be severely impacted. We depend on these partners to
deliver fully operational mobile Bitcoin
mining facilities. If a partner fails to meet its commitments, we may
face delays, increased costs, or even the
inability to deploy our mining facilities as planned, which could harm
our business.
The Company's operations are subject to the risks inherent in the
establishment of a new business enterprise.
Our operations face typical startup risks, including the need to
secure sufficient capital, effectively implement our
business plan, and achieve revenue targets. The success of our Bitcoin
mining operations is contingent upon these
factors, and any setbacks could materially affect our ability to grow
and sustain our business.
The Company's growth relies on market acceptance of its mobile Bitcoin
mining facilities.
While we believe there is significant demand for mobile Bitcoin mining
facilities powered by stranded natural gas,
there is no assurance of broad market acceptance. If the market does
not embrace our solutions, or if competitors
offer more attractive alternatives, our financial performance could
suffer, and we may not be able to achieve our
growth objectives.
Our business model is dependent on the profitability of our Bitcoin
mining operations.
If the Bitcoin mining facilities we acquire and/or deploy do not
generate the expected returns, our financial
performance could be negatively impacted. Additionally, if the
price of Bitcoin declines significantly, or if
operational costs increase, our profitability may suffer. We
rely on the successful operation and income generation
of these facilities, and any failure in these areas could affect our
ability to continue operations.
Our business depends heavily on our officers and directors.
Our future ability to execute our business plan depends upon the
continued service of our President and Chief
Executive Officer, Stephen H. Watkins. If we lost the services of our
key personnel, or if our executive officer or
employees joined a competitor or otherwise competed with us, our business
may be adversely affected. We cannot
assure that we will be able to retain or replace our key personnel.
Our officers and directors may have conflicts of interest.
Our ability to execute our business plan and terms of this offering
rely upon the continued service of our officers and
directors. Some of these Officers and Directors may have conflicts
of interest which may adversely affect our
business. We cannot assure that we will be able to monitor and
align interests of these parties which could
adversely affect our business and associated financial results and
obligations.
If we are unable to retain the members of our management team or
attract and retain qualified management
team members in the future, our business and growth could suffer.
Our success and future growth depend, to a significant degree, on
the continued contributions of the members of our
management team. Each member of our management team is an at-will
employee and may voluntarily terminate his
or her employment with us at any time with minimal notice. We also
may need to hire additional management team
members to adequately manage our growing business. We may not be
able to retain or identify and attract additional
qualified management team members. Qualified individuals are in high
demand, and we may incur significant costs
to attract and retain them. If we lose the services of any member of
our management team or if we are unable to
attract and retain additional qualified senior management teams, our
business and growth could suffer.
Our management has broad discretion and authority to manage the
business and modify policies and strategies
without prior notice or stockholder approval.
Our management has the authority to modify or waive certain of our
operating policies and strategies without prior
notice and without investor approval. Absent investor approval,
we may not change the nature of our business so as
to cease to exist unless sold or purchased at the exclusive option
of management. We cannot predict the effect any
changes to our current operating policies or strategies would have
on the business model, operating results and
returns to investors. Nevertheless, the effects may adversely affect
our business and impact our ability to make
distributions.
Our operating results may continue to be adversely affected as a
result of unfavorable market, economic, social,
political and regulatory conditions.
We are subject to regulation by laws at the local, state and federal
levels. These laws and regulations, as well as their
interpretation, may be changed from time to time. Any change in
these laws or regulations could have a material
adverse effect on our business.
An unstable global economic, social and political environment may
have a negative impact on demand for our
services, our business and our operations, including the U.S.
economic environment. The regulatory environment is
subject to political conditions and potential change is uncertain.
The economic, social and political environment has
or may negatively impact, among other things:
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current and future demand for our services;
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price competition for our products and services.
RISKS RELATED TO THIS OFFERING
Risks Related to Organization and Structure under Tier 1 of
Regulation A+.
There is no minimum capitalization required in this offering.
We cannot assure that all or a significant number of Shares will
be sold in this offering. Investors' subscription
funds will be used by us at our discretion, and no refunds will
be given if an inadequate amount of money is raised
from this offering to enable us to conduct our business. If we
raise less than the entire amount that we are seeking in
the offering, then we may not have sufficient capital to meet our
operating requirements. We cannot assure you that
we could obtain additional financing or capital from any source,
or that such financing or capital would be available
to us on terms acceptable to us. Under such circumstances,
investors could lose their investment in us. Furthermore,
investors who subscribe for Shares in the earlier stages of the
offering will assume a greater risk than investors who
subscribe for Shares later in the offering as subscriptions approach
the maximum amount.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
We make forward-looking statements under the "Summary,"
"Risk Factors," "Business," "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" and in other sections of this Offering
Circular. In some cases, you can identify these statements by
forward-looking words such as "may," "might,"
"should," "expect," "plan," "anticipate," "believe," "estimate,"
"predict," "potential" or "continue," and the negative
of these terms and other comparable terminology. These forward-
looking statements, which are subject to known
and unknown risks, uncertainties and assumptions about us, may
include projections of our future financial
performance based on our growth strategies and anticipated trends
in our business. These statements are only
predictions based on our current expectations and projections about
future events. There are important factors that
could cause our actual results, level of activity, performance or
achievements to differ materially from the results,
level of activity, performance or achievements expressed or implied
by the forward-looking statements. In
particular, you should consider the numerous risks and uncertainties
described under "Risk Factors.
While we believe we have identified material risks, these risks and
uncertainties are not exhaustive. Other sections
of this Offering Circular describe additional factors that could
adversely impact our business and financial
performance. Moreover, we operate in a very competitive and rapidly
changing environment. New risks and
uncertainties emerge from time to time, and it is not possible to
predict all risks and uncertainties, nor can we assess
the impact of all factors on our business or the extent to which
any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements.
Although we believe the expectations reflected in the forward-
looking statements are reasonable, we cannot
guarantee future results, level of activity, performance, or
achievements. Moreover, neither we nor any other person
assumes responsibility for the accuracy or completeness of any
of these forward-looking statements. You should not
rely upon forward-looking statements as predictions of future
events. We are under no duty to update any of these
forward-looking statements after the date of this Offering Circular
to conform our prior statements to actual results
or revised expectations, and we do not intend to do so.
Forward-looking statements include, but are not limited to,
statements about:
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our business' strategies and investment policies;
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our business' financing plans and the availability of capital;
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potential growth opportunities available to our business;
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the risks associated with potential acquisitions by us;
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the recruitment and retention of our officers and employees;
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our expected levels of compensation;
?
the effects of competition on our business; and
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the impact of future legislation and regulatory changes on our
business.
We caution you not to place undue reliance on the forward-lookin
g statements, which speak only as of the date of
this Offering Circular.
DILUTION
There will be dilution to any existing third-party investors in
the Company as a result of this offering.
Public investors who purchase shares of Class "A" Common Stock in
this offering will pay a price of $[offering
price] per share. This price significantly exceeds the effective
cash cost paid by existing shareholders for their
shares. Existing shareholders are founders and not paid for thei
r shares.
As a result, new investors will experience an immediate dilution
in the value of their investment when comparing
the offering price to the pro forma net tangible book value per
share after the offering. The dilution represents the
difference between the public offering price per share and the
pro forma net tangible book value per share after
the offering.
PLAN OF DISTRIBUTION
General
The Company is hereby offering for sale (the "Offering") shares
of its common stock, no par value ("Shares")
[quantity of shares to be determined at time of qualification of
the Reg A offering] for a purchase price per share [to
be determined at qualification of the Reg A offering], for a total
offering amount of up to $19,999,999.
Minimum Amount for Offering
There is no minimum number of Shares that must be sold. Upon the
close of the Offering, the Company may accept
subscriptions and add the subscription funds to the capital of th
e Company.
Minimum Amount Required to be Purchased by an Investor
The minimum number of Shares which must be purchased is "TO BE
DETERMINED" Shares for $19,999,999,
unless a lesser amount is approved for any investor by the Board
of Directors of Company in its discretion (for
executive officers and for others where special circumstances are
involved).
All of our Shares are being offered on a "best efforts" basis under
Regulation A+ of Section 3(b) of the Securities
Act of 1933, as amended, for Tier 1 offerings. The offering will
terminate on the earlier of 12 months from the date
this Offering Circular is re-qualified for sale by the SEC (which
date may be extended for an additional 90 days in
our sole discretion) or the date when all Shares have been sold.
..
USE OF PROCEEDS
We estimate that the net proceeds we will receive from this offering
will be approximately $19,999,999 (minus
expenses) if the entire offering is sold.
Offering proceeds shall be used to fund EPIC's mining acquisition and
projects.
EPIC's Capital Requirements and Funding Structure
EPIC (Entrex Production and Installation Company) is focused on
acquiring fully assembled and operational Bitcoin
mining facilities from our development partners which are parked,
under five year agreements, at stranded gas wells
as a power source. To support these initiatives, EPIC has outlined
a structured capital requirement plan to ensure the
efficient deployment and scaling of its operations.
EPIC is seeking to raise funds directly through this offering once
qualified and separately with institutional investors
to support our development partners to and the deployment of mobile
Bitcoin mining facilities. These facilities will
be purchased based on their proven historical financial performance,
which has been contractually agreed upon with
three key development partners. As of 08-2024 three developers eac
h has a letter of intent to build and deliver 100
mobile Bitcoin mining facilities through 12/31/2025.
Each Developer has agreed to provide 100 units each. Each facility
, on average, is projected to produce:
Projected
300 Contracted Facility
Individual Facilities
Total Projected 2025 Acquisitions
Revenue: $1,600,000
$480,000,000
Net Income: $1,000,000
$300,000,000
Each Bitcoin mining facility is projected to generate approximately
$1 million in net income annually which is
expected to provide net income to the company immediately upon purchase.
Once the cash flows are proven, by
third party entities, EPIC plans to purchase these facilities at a 4x
multiple of their annualized net income using the
capital from the institutional warehouse line and/or this offering.
Facility 1: $105,000
Facility 2: $200,363
Facility 3: $449,000
Facility 4: $105,000
The projected $1 million net income per facility for the 300 sites
reflects an average across all units, including
efficiencies gained from scaling and optimizing operations over time.
Initial units may have lower net income
projections due to earlier deployment and operational ramp-up costs,
while subsequent units are expected to perform
at or above the $1 million annualized net income target. These
variations reflect site-specific factors such as energy
efficiency, operational costs, and mining output during the first
year.
The income projections are based on third-party verified historical
data from similar Bitcoin mining facilities using
Bitmain Antminer S21 units or agreed alternative units specified in
purchase orders with our developers. The
assumptions include stable Bitcoin prices, energy costs from stranded
gas wells, and average mining output based on
current market conditions. These projections are validated through
real-time monitoring and performance analysis
from deployed units.
EPIC's mission and vision, and executed mobile mining facility
purchases needs acquisition capital to purchase the
contracted facilities. Based on the contracted individual sites, w
hich are each projected to producing $1 million in
proven historical net income or proportionally thereof, a total of
$1.2 billion in total acquisition capital would be
required.
These 300 sites represent a portion of the 1000 stranded wells the
company has access. As the 300 wells start being
acquired the company anticipates offering additional capital as
needed for the remaining 700 available stranded gas
wells available as contracted. The Company's Bitcoin mining
facilities will be located at stranded gas wells across
North East Ohio, North West Pennsylvania, and Texas and a growing
list of opportunistic sites as they become
available. These wells have been selected based on proximity to
energy sources and the infrastructure needed to
support the mobile mining facilities. Currently, none of the Bitcoin
mining facilities are located on the wells, but
they will be moved to these locations upon delivery. Each Bitcoin
mining facility will operate on different stranded
gas wells to maximize energy utilization. The Company has access to
over 1,000 stranded wells, of which 300 are
contracted for use. Each facility will be positioned at a separate
well, allowing for maximum efficiency and energy
consumption at each site.
The Company has secured licenses with gas well operators through
five-year agreements to utilize the energy from
stranded natural gas wells for Bitcoin mining. These agreements grant
EPIC exclusive rights to access and operate
the wells during this period. While references to the acquisition of
gas wells were made, the Company does not own
any wells. Instead, it operates through licenses and long-term
agreements with well operators. These agreements
have been filed as exhibits.
In addition to the Bitcoin mining income the company has engaged an
ISO Auditor to audit each facility as it is
being developed to establish the carbon offsets created through
the utilization of the stranded gas wells. Each
facility is estimated to produce 2500 metric tonnes of carbon offset
s but requires an on-site audit to determine exact
carbon offset production. Any income from the monetization of
these facilities' carbon offsets shall become
additional revenue to the company. The projected $5 million in ne
t income will be generated from the acquisition of
Bitcoin mining facilities deployed at stranded gas wells. This
amount reflects income from multiple mining units,
each projected to generate between $105,000 and $1 million annually,
based on proven historical net income. The
facilities' performance will be verified by third-party audits during
the 'Proof of Income' period before final
acquisition. This net income refers to the annual net income generated
from contracts related to the first 16 Bitcoin
mining facilities, expected to be purchased in Q4 2024. Each facility's
contract is projected to generate
approximately $1 million in net income annually, based on current market
conditions and contractual terms. If all
securities being qualified in this offering are not sold, there may be
material changes in the use of proceeds,
particularly with respect to the number of mobile bitcoin miners
purchased in the initial phase. The remainder of the
300 intended Bitcoin mining contracts will be financed through a
combination of future offerings, secured debt, and
reinvested profits from the contracts of the initially deployed
facilities.
The estimation that each Bitcoin mining facility will generate 2,500
metric tonnes of carbon offsets annually is based
on independent assessments of methane emissions prevented by
utilizing stranded natural gas wells. These
assessments consider the volume of gas that would have otherwise
been flared or vented and the energy consumption
of each mining facility. The figures have been cross-referenced
with industry benchmarks and are subject to
validation through ISO audits. EPIC has engaged an ISO-certified
auditor, Net Zero Design and Analysis, Inc to
perform on-site audits for each Bitcoin mining facility to verify
the volume of carbon offsets generated. The audit
process involves assessing the emissions data from the stranded
natural gas wells and confirming the carbon offset
calculations. This ensures that the offsets produced by EPIC's
operations are compliance-grade and can be sold to
carbon offe buyers.
CherAmi 100 Unit Contract:
The Company has entered into an agreement with CherAmi Digital LLC
for the purchase of up to 100
operational Bitcoin mining facilities. The contract outlines that
the purchase price is equal to 4x projected annual
cash flows, based on proven results during a test period known as
the Proof of Income (POI). Each facility is
expected to generate approximately $1,600,000 in annual revenue,
subject to third-party verification of cash flows.
The contract is designed to allow Entrex to acquire additional
units through the end of 2025, with facilities to be
delivered and set up at designated well sites.
The units are provided as "new" and are purchased based on
specifications that maximize asset value. (Appendix B)
Moria Purchase Agreement:
Entrex has executed a purchase agreement with Moria Mining
Technologies Corporation for mobile Bitcoin
mining facilities to be installed at stranded oil and gas wells.
This agreement includes a purchase multiple of 4x net
income, based on the stabilized annualized 12-month net income
of the facilities. The purchase price will be based
on performance during a "Proof of Income" period, and 20% of the
purchase price will be held in escrow to
account for potential variations in actual income.
* Projected Net Income: Each facility is anticipated to
generate $1,000,000 in annual net income however
the first contracted unit is based on $200,363 annual net
income, leading to an expected purchase price of
$801,452 per unit, subject to the Proof of Income by our third party.
* Evidence: Please refer to Appendix C: Moria Purchase Agreement
PickAxe Mining Letter of Intent:
Entrex has signed a Letter of Intent (LOI) with PickAxe
Mining, Inc. for the future acquisition of Bitcoin mining
facilities. Under this agreement, Entrex will purchase
mining facilities based on projected annual cash flows equal to
58% of the capital cost. For example, a facility with
$449,000 in annual cash flow will be purchased for 4x the
annualized cash flow, amounting to $1,796,000 per unit.
* Additional Units: The LOI covers the acquisition
of up to 100 facilities through the end of 2025.
* Evidence: Please refer to Appendix D: PickAxe
Mining LOI
Energex Letter of Intent:
Entrex has also signed a Letter of Intent with Energex
(Appendix E) to support asset acquisition strategies and
provide mobile Bitcoin mining facilities powered by stranded
gas wells. This agreement facilitates the utilization of
these gas wells, ensuring that Entrex has access to reliable,
low-cost energy for its mining operations. The Letter of
Intent outlines a collaborative approach for future facility
deployments. EPIC integrates environmental
sustainability into its business model through the generation
and monetization of carbon offsets. The company's
Bitcoin mining facilities are strategically located near
stranded natural gas wells, which allows for the use of
otherwise wasted energy resources. By utilizing this energy
source, EPIC not only minimizes its environmental
impact but also generates carbon offsets.
The global carbon offsets market allows businesses to compensate
for their emissions by investing in environmental
projects that reduce greenhouse gases. In EPIC's model, the
Bitcoin mining facilities are powered by stranded
natural gas wells, converting otherwise wasted energy into
productive use. This process creates carbon offsets by
preventing methane emissions from flaring or venting, which
can be sold on carbon markets to carbon offset buyers
EPIC is leveraging the Entrex Carbon Market to package and
sell these carbon offsets to environmentally conscious
investors and institutions, positioning itself at the
intersection of cryptocurrency and environmental finance.
How Carbon Offsets Fit into the Business:
1. Environmental Benefit: Stranded natural gas, which
would otherwise be vented or flared, contributes to
greenhouse gas emissions. By using this gas to power its
Bitcoin mining facilities, EPIC prevents these
emissions, creating carbon offsets.
2. ISO Certification: Each mining facility is subject
to an ISO audit which has been contracted to verify the
quantity of carbon offsets produced. This ensures that the
offsets are compliance-grade and can be sold on
various carbon markets.
3. Debt/Equity Opportunities: The securitization of
these offsets also creates opportunities for EPIC to
secure debt or equity financing. By leveraging the value of
the carbon offsets, the company can attract
institutional investors who are seeking to invest in both
cryptocurrency and environmentally conscious
ventures.
By utilizing stranded natural gas for energy, EPIC not only
reduces greenhouse gas emissions but also generates
carbon offsets that can be monetized. This approach delivers
environmental benefits such as a reduction in methane
emissions and contributes to the global effort to combat
climate change. For investors, this translates into dual
financial returns through both cryptocurrency mining profits
and the sale of carbon offsets, making EPIC's
operations both profitable and environmentally responsible.
TERMS OF THE OFFERING
Class "A" Common
Stock
We are offering shares of Class "A" Common Stock [quantity
and pricing to be determined
at Reg A offering qualification].
Use of Proceeds
We estimate that the net proceeds we will receive from this
offering will be approximately
$19,999,999 if all Shares are sold. We plan to use the
majority of the net proceeds from this
offering to fund the capital needs to acquire contracted
mining operations from Developers
and to support key EPIC projects that are integral to our
business strategy. Any remaining
funds will be used to support existing operations, hire new
personnel, and finance sales,
marketing, and other revenue-generating initiatives, as well
as for working capital or other
corporate acquisition activities as determined by the Board
of Directors.
Liquidity
This is a Tier 1, Regulation A offering where the offered
securities will not be listed on a
registered national securities exchange upon qualification.
This offering is being conducted
pursuant to an exemption from registration under Regulation
A of the Securities Act of
1933, as amended. After qualification, we may apply for these
qualified securities to be
eligible for quotation on an alternative trading system or
over-the-counter market, if we
determine that such a market is appropriate given the structure
of the Company and our
business objectives. However, there is no guarantee that the
Shares will be publicly listed or
quoted, or that a market will develop for them.
Please review carefully "Risk Factors" for more information.
Risk Factors
An investment in the Shares involves certain risks. You should
carefully consider the risks
above, as well as other risks described under "Risk Factors"
in this offering circular before
making an investment decision.
Subscription Period
The offering will terminate on the earlier of 12 months from the
date this Offering Circular is qualified for sale by
the SEC (which date may be extended for an additional 90 days in
our sole discretion) or the date when all Shares
and Shares have been sold.
Subscription Procedures
If you decide to subscribe for our Shares in this Offering, you
should review your subscription agreement.
Completed and signed subscription documents shall be either mailed
directly to the Company at Entrex Production
and Installation Company, Inc., 150 E Palmetto Park Road, Suite
800, Boca Raton, FL 33432, or sent via electronic
correspondence to SWatkins@entrexcarbonmarket.com. You shall
deliver funds by either check, ACH deposit or
wire transfer, pursuant to the instructions set forth in the
subscription agreement. If a subscription is rejected, all
funds will be returned to subscribers. Upon acceptance by us
of a subscription, confirmation of such acceptance will
be sent to the subscriber.
Any potential investor will have ample time to review the
subscription agreement, along with their counsel, prior to
making any final investment decision. We shall only deliver
such subscription agreement upon request after a
potential investor has had ample opportunity to review this
Offering Circular.
Right to Reject Subscriptions
After we receive your complete, executed subscription
agreement and the funds required under the subscription
agreement have been transferred to our designated account,
we have the right to review and accept or reject your
subscription in whole or in part, for any reason or for no reason.
We will return all monies from rejected
subscriptions immediately to you, without interest or deduction.
Acceptance of Subscriptions; No Revocation
Upon our acceptance of a subscription agreement, we will countersign
the subscription agreement and issue the
Shares or Shares, as applicable, subscribed at closing. Once you
submit the subscription agreement and it is
accepted, you may not revoke or change your subscription or
request your subscription funds. All accepted
subscription agreements are irrevocable.
BUSINESS
Our Company
Issuer's Business
The Entrex Production and Installation Company's mission is to buy
operational Bitcoin mining facilities from
development partners. This strategic approach mitigates risks and
leverages the expertise of partners who have
previously managed and facilitated roll-ups of diversified industries.
EPIC's innovative model not only addresses
significant pain points in both industries but also offers substantial
financial returns and environmental benefits
through carbon offsets.
Entrex Production and Installation Company, Inc.'s business model is
to capitalize on the convergence of
environmental sustainability and cryptocurrency mining.
EPIC's strategy centers on purchasing fully assembled and operational
Bitcoin mining facilities from development
partners who handle the initial assembly and deployment. These
facilities are strategically located at stranded natural
gas wells, turning otherwise wasted energy into a valuable resource.
This innovative approach not only addresses
significant environmental concerns by reducing methane emissions
and creating carbon offsets but also leverages
these resources to generate substantial financial returns.
The primary revenue streams for EPIC come from the operation of
these Bitcoin mining facilities, which are
expected to generate returns. The Company is positioning itself
as a leader in the integration of cryptocurrency
mining with sustainable practices, aligning its business objectives
with global trends towards environmental
responsibility and financial innovation.
Compliance with Rule 251(b)(3) and Disclosure of Targeted Entities:
Our business model complies with Rule 251(b)(3) of Regulation A
by ensuring that the use of proceeds is only to
fund the acquisition of entities named in the offering. All such
entities are identified in this Offering Circular. The
Company has established or is in the process of establishing
relationships with several targeted entities. These
entities include CherAmi Digital LLC, with whom we have a formal
agreement for the purchase of 100 Bitcoin
mining facilities, Moria Mining Technologies, with whom we have a
purchase agreement for mobile Bitcoin mining
facilities, PickAxe Mining Inc., with whom we are in negotiations
for the future acquisition of Bitcoin mining
facilities, and Energex, with whom we have signed a Letter of
Intent to utilize stranded gas wells for our operations.
The status of these arrangements varies, and the Company will only
extend offers to entities disclosed in this
document.
Furthermore, the financial statements of any acquired entities that
are material to the Company's financial condition
will be included in this Offering Circular, in compliance with Part
F/S (b)(7) of Form 1-A. To date, no significant
acquisitions have been completed that would require additional
financial disclosure, but the Company is committed
to providing the necessary financial information for any future
acquisitions as required by the SEC. If the Company
is unable to identify and provide the necessary disclosure of
these targeted entities, we will consider withdrawing the
Form 1-A in accordance with Rule 251(b)(3).
DESCRIPTION OF PROPERTY
We do not own any plants or facilities. Each acquisition of a
mobile data mining facility will be titled pursuant to
the mobile trailer in a United States State Department of Motor
Vehicles as both the trailer and encumbrances.
Each title may be separately assigned to potential debt providers,
if any, at the discretion of management.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF
OPERATIONS
Statements in the following discussion and throughout this
registration statement that are not historical in nature
are "forward-looking statements." You can identify forward-looking
statements by the use of words such as
"expect," "anticipate," "estimate," "may," "will," "should,"
"intend," "believe," and similar expressions.
Although we believe the expectations reflected in these
forward-looking statements are reasonable, such statements
are inherently subject to risk and we can give no assurances
that our expectations will prove to be correct. Actual
results could differ from those described in this registration
statement because of numerous factors, many of which
are beyond our control. These factors include, without limitation,
those described under "Risk Factors." We
undertake no obligation to update these forward-looking
statements to reflect events or circumstances after the date
of this registration statement or to reflect actual outcomes.
Please see "Forward Looking Statements" at the
beginning of this registration statement.
The following discussion of our financial condition and results
of operations should be read in conjunction with our
financial statements and the related notes thereto and other
financial information appearing elsewhere in this
registration statement. We undertake no obligation to update
any forward-looking statements in the discussion of
our financial condition and results of operations to reflect
events or circumstances after the date of this registration
statement or to reflect actual outcomes.
Overview
Entrex Production and Installation Company, Inc. is a Boca Raton,
FL-based company that operates to purchase
operating Bitcoin mining facilities from third party developers
after proving historical net income, and to monetize
the resultant carbon offsets; if any.
Entrex Production and Installation Company, Inc.'s mission is to
become a leader in the acquisition and
management of Bitcoin mining operations. The company executes
licenses with stranded gas well operators to
install and subsequently acquire fully operational Bitcoin mining
facilities located for up to five years on the
licensed gas well's properties.
Entrex has built a roster of world-class collaborators ensuring
that both its Bitcoin mining projects meet the highest
standards of compliance and sustainability. The company's business
model achieves capital efficiencies unavailable
to competitors by purchasing proven bitcoin mining facilities
from developers which are anticipated to generate
carbon offsets and cryptocurrency revenues.
Revenue Recognition
The Company anticipates deriving its revenue primarily from acquiring
and operating mobile Bitcoin mining
facilities, leveraging stranded gas wells to power these operations.
This innovative approach not only anticipates
generating substantial financial returns but also produces compliance
-grade carbon offsets. The company will
manage its financials on a GAAP Work in Progress (WIP) basis and
report via both WIP and Accrual methods to
benefit management and shareholders.
The Company plans to manage its financials on a GAAP Work in Progress
(WIP) basis and report using both WIP
and Accrual methods to provide a comprehensive financial view for
management and shareholders. Under this
approach, the Company will recognize revenue based on the percentage
of completion method for contracts, in
accordance with ASC 606 - Revenue from Contracts with Customers,
which allows for revenue recognition as
performance obligations are satisfied over time. The WIP accounting
will allow for accurate tracking of costs
incurred, work performed, and progress towards completion of each
contract, providing real-time insights into
project profitability. Additionally, the Accrual method will ensure
that revenues and expenses are recorded when
earned and incurred, regardless of when cash is received or paid.
This dual approach is designed to give
management and shareholders a clear view of financial performance,
both in terms of ongoing operations and long-
term contract completion.
The Company follows the authoritative guidance under ASC 606 -
Revenue from Contracts with Customers, which
governs revenue recognition for its Bitcoin mining operations.
Revenue is recognized when the performance
obligation is satisfied, which occurs when a block of Bitcoin is
successfully mined and verified. The value of the
Bitcoin at the time of mining is recorded as revenue, with Bitcoin
classified as an intangible asset on the balance
sheet.
Additionally, the Company will recognize revenue from the generation
and sale of carbon offsets, following the
guidance provided under ASC 450 - Contingencies for the recognition of
environmental credits, as well as ASC 820
- Fair Value Measurement for the valuation of carbon offsets. The
Company plans to monetize the carbon offsets
through markets such as the Entrex Carbon Market, where offsets are
sold to generate additional income streams.
All revenue will be accounted for using GAAP principles, ensuring
compliance with regulatory standards for both
cryptocurrency and environmental credits.
Upon the successful completion of this offering, the company will
obtain annual audits conducted by an accounting
organization as directed by the Board of Directors. These audits
will ensure the preparation of PCAOB-compliant
statements if required.
While the Company has not yet completed third-party due diligence,
it plans to engage an independent auditor to
confirm Revenues and EBITDA post-installation of the mining
facilities it has contracted to purchase. The due
diligence process will utilize specialized software applications
designed to monitor and track Bitcoin mining
operations in real-time. These applications will:
Monitor mining performance: The software will provide real-time
data on the output of each facility, including the
number of Bitcoins mined and the performance of the equipment.
Confirm revenue generation: The results from the mining monitoring
software will be cross-verified with
cryptocurrency-to-fiat conversion rates, specifically Bitcoin to
U.S. dollar, to ensure accurate revenue calculations.
Validate EBITDA projections: In addition to revenue verification,
the due diligence will include an examination of
operational costs and profit margins to validate the projected
EBITDA for each facility.
This independent verification will provide investors with
confidence in the accuracy and reliability of the
Company's financial forecasts.
Results of Operations for
Gross revenue: The Company is pre-revenue
General and administrative: The Company has not hired direct
employees and uses the services of the Entrex
Carbon Market, Inc.
The table below sets forth line items from the Company's
unaudited Statements of Operations for 09-30-2024
Facility
Projected Annual Revenue
Projected Annual Net Income
Third-Party Verification Date
Facility 1
$168,000
$105,000
Q4 2024
Facility 2
$200,363
$200,363
Q4 2024
Facility 3
$449,000
$449,000
Q4 2024
Facility 4
$168,000
$105,000
Q4 2024
Total
$1,374,981
$859,363
Liquidity and Capital Resources
As of this offering date we had cash of $0 and a line of
credit from a Shareholder of $25,000. We used
approximately $0 in cash for operating activities and were
provided $0 through financing activities.
Our management's discussion and analysis of our financial
condition and results of operations is based on our
financial statements, which are prepared in accordance with
U.S. generally accepted accounting principles issued by
the Financial Accounting Standards Board ("FASB"). The
preparation of these financial statements requires us to
make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial
statements, as well as the reported expenses during the
reporting periods. Actual results may differ from these
estimates under different assumptions or conditions.
While our significant accounting policies are more fully
described in the notes to our financial statements appearing
elsewhere in this Offering Document, we believe that the
accounting policies discussed below are critical to our
financial results and to the understanding of our past and
future performance, as these policies relate to the more
significant areas involving management's estimates and
assumptions. We consider an accounting estimate to be
critical if: (1) it requires us to make assumptions because
information was not available at the time or it included
matters that were highly uncertain at the time we were making
our estimate; and (2) changes in the estimate could
have a material impact on our financial condition or results
of operations.
Equity-based compensation
None.
DIRECTORS, EXECUTIVE OFFICERS, AND SIGNIFICANT EMPLOYEES
Directors and Executive Officers.
The following table sets forth the name, age, and position of
our executive officers and directors. Executive officers
are elected annually by our Board of Directors. Each
executive officer holds his office until he resigns, is removed
by the Board, or his successor is elected and qualified.
Directors are elected annually by our shareholders at the
annual meeting. Each director holds his office until his
successor is elected and qualified or his earlier resignation
or removal.
Name
Age
Position
Term of Office
Stephen H. Watkins
62
President/Secretary
Since Inception
Tom Harblin
57
Director
Since Inception
Stephen H. Watkins: is Managing Member and is the founding
Chairman and CEO of various majority owned
entities of the Entrex Holding Company (EHCo, LLC). Stephen
is an experienced entrepreneur founding a series of
successful information and business services companies; two of
which grew to billion-dollar market cap companies.
Stephen authored the book Capital Can't Fund What It Can't Find.
In the past he wrote a syndicated bi-monthly
finance column-read by over eight million national readers at
its peak.
Family Relationships
There are no family relationships among any of the directors and
executive officers.
Involvement in Certain Legal Proceedings
Our directors and officers have not been convicted in a criminal
proceeding, excluding traffic violations or similar
misdemeanors, nor have been a party to any judicial or administrative
proceeding during the past ten years that
resulted in a judgment, decree or final order enjoining the person
from future violations of, or prohibiting activities
subject to, federal or state securities laws, or a finding of any
violation of federal or state securities laws, except for
matters that were dismissed without sanction or settlement. Except
as set forth in our discussion below in "Certain
Relationships and Related Transactions," our directors and officers
have not been involved in any transactions with
us or any of our affiliates or associates which are required to be
disclosed pursuant to the rules and regulations of the
SEC.
The $1 million net income projection per facility is an average
across all facilities, factoring in scalability and
operational optimization over time. Initial sites may generate
lower net incomes due to start-up costs and early-stage
deployment, as indicated by projected net incomes of $105,000,
$200,363, and $449,000 for the first four sites. The
remaining facilities are expected to generate higher net income
s as operational efficiencies increase.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Executive Compensation
Name and
Principal
Position
Year
Ended
Salary
($)
Bonus
($)
Option
Awards
($)
Nonequity
Incentive Plan
Compensation
($)
Non-
Qualified
Deferred
Compensation
Earnings
($)
All Other
Compensation
($)
Total
($)
Stephen H.
Watkins, CEO
2023
0
0
0
0
0
0
0
Tom Harblin
2023
0
0
0
0
0
0
0
*Compensation for operators and directors of the Company may
be provided through agreements with affiliated
entities. Directors and Officers may have additional performance
-based quotas and compensation provided
exclusively at the direction of the Managing Members.
The income projections are based on historical performance data
from similar Bitcoin mining facilities and validated
by third-party auditors. Key assumptions include a stable Bitcoin
price, low operational costs derived from stranded
gas wells, and expected energy consumption rates from state-of-
the-art mining equipment. These projections have
been further substantiated by real-time mining output data from
pilot facilities and are adjusted for market
fluctuations.
Officers and Directors:
At our sole discretion we may add additional Officers and
Directors and compensate them through annual retainer
fees along with reimbursement of reasonable out-of-pocket expenses
incurred in connection with attending each
meeting and/or expenses for the benefit of the company, decided
exclusively by the CEO and/or Board of Directors.
Each independent Officer and Director will receive $500 in connection
with each meeting that they attend, plus
reimbursement of reasonable out-of-pocket expenses incurred in
connection with attending each committee meeting
not held concurrently with a board meeting. Compensation shall be
accrued by the company and paid as available.
Compensation for expenses, Officers and Directors will be managed
through the sole decisions and directions of the
Managing Member.
Indemnification Agreements:
We shall enter into indemnification agreements with our Directors
and Officers. The indemnification agreements are
intended to provide our Directors the maximum indemnification
permitted under law and/or requested by the
respective Officer and/or Director. Each indemnification agreement
provides that Entrex shall indemnify the
Director or Office who is a party to the agreement (an "Indemnitee"),
including the advancement of legal expenses,
if, by reason of his or her corporate status, the Indemnitee is, or
is threatened to be made a party to or a witness in
any threatened, pending, or completed proceeding.
Employment Agreements
We have not entered into employment agreements with any of our
employees, officers and directors.
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITYHOLDERS
Principal Stockholders
The following table sets forth information as to the shares of
Stock beneficially owned as of August 15, 2024 by (i)
each person known to us to be the beneficial owner of more than
5% of our common stock; (ii) each Director; (iii)
each Executive Officer; and (iv) all of our Directors and
Executive Officers as a group. Unless otherwise indicated
in the footnotes following the table, the persons as to whom the
information is given had sole voting and investment
power over the Shares of common stock shown as beneficially owned
by them. Beneficial ownership is determined
in accordance with Rule 13d-3 under the Exchange Act, which generally
means that any shares of common stock
subject to options currently exercisable or exercisable within 60 days
of the date hereof are considered to be
beneficially owned, including for the purpose of computing the
percentage ownership of the person holding such
options, but are not considered outstanding when computing the
percentage ownership of each other person. We
currently have no options outstanding.
Entrex Production and Installation Company, Inc.
Authorized and Issued Shares
Common Shares:
Equity Match Inc, Controlled by Thomas Harblin
49,000 Shares
Ubique Holdings, LP controlled by Courtney Watkins
51,000 Shares
Shares from this offering:
pending
INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS
Code of Business Conduct and Ethics
To date, we have not adopted a code of business conduct and
ethics for our management and employees. We intend
to adopt one in the near future.
SECURITIES BEING OFFERED
The following summary is a description of the material terms
of our capital stock and is not complete. You should
also refer to our articles of incorporation and our bylaws, which
are included as exhibits to the offering statement of
which this Offering Circular forms a part.
General
Common shares are owned or controlled by founders of the Company.
There are no Preferred shareholders.
Common Class A stock consists of 1,000,000 shares of common stock,
par value $0. As of the date of this Offering
Circular, there are 100,000 shares of our common stock outstanding
and 1,000,000 shares authorized. The Company
intends to file ongoing "current information" as that term is
defined by the Securities Act.
Listing and Transfer Agent
The Company is presented not listed on any market.
The transfer agent for our Shares is expected to be Pacific
Stock Transfer, Inc.
Limitations on Liability and Indemnification of Officers and
Directors
Florda law authorizes corporations to limit or eliminate
(with a few exceptions) the personal liability of directors to
corporations and their stockholders for monetary damages for
breaches of directors' fiduciary duties as directors.
Our articles of incorporation and bylaws include provisions
that eliminate, to the extent allowable under Florida law,
the personal liability of directors or officers for monetary
damages for actions taken as a director or officer, as the
case may be. Our articles of incorporation and bylaws also
provide that we must indemnify and advance reasonable
expenses to our directors and officers to the fullest extent
permitted by Florida law. We are also expressly
authorized td officers' insurance for our directors, officers,
employees, and agents for some liabilities. We currently
maintain directors' and officers' insurance covering certain
liabilities that may be incurred by directors and officers
in the performance of their duties.
The limitation of liability and indemnification provisions may
discourage stockholders from bringing a lawsuit
against directors for breach of their fiduciary duty. These
provisions may also have the effect of reducing the
likelihood of derivative litigation against directors and officers
, even though such an action, if successful, might
otherwise benefit us and our stockholders. In addition, your
investment may be adversely affected to the extent that,
in a class action or direct suit, we pay the costs of settlement
and damage awards against directors and officers
pursuant to the indemnification provisions in our articles of
incorporation and bylaws.
There is currently no pending litigation or proceeding involving
any of the directors, officers or employees for
which indemnification is sought.
MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a summary of certain material U.S.
federal income tax consequences relevant to the
purchase, ownership and disposition of the Shares, but does not
purport to be a complete analysis of all potential tax
consequences. The discussion is based upon the Code, current,
temporary, and proposed U.S. Treasury regulations
issued under the Code, or collectively the Treasury Regulations,
the legislative history of the Code, IRS rulings,
pronouncements, interpretations and practices, and judicial
decisions now in effect, all of which are subject to
change at any time. Any such change may be applied retroactively
in a manner that could adversely affect a
Bondholder. This discussion does not address all of the U.S.
federal income tax consequences that may be relevant
to a holder in light of such Stockholder's particular circumstances
or to Stockholders subject to special rules,
including, without limitation:
?
A broker-dealer or a dealer in securities or currencies;
?
A Limited Liability Corporation;
?
A bank, thrift or other financial institution;
?
A regulated investment company or a real estate investment trust;
?
An insurance company;
?
A tax-exempt organization;
?
A person subject to the alternative minimum tax provisions of the Code;
?
A person holding the Shares or Redeemable Preferred Stock as
part of a hedge, straddle, conversion,
integrated or other risk reduction or constructive sale transaction;
?
A partnership or other pass-through entity;
?
A person deemed to sell the Shares or Redeemable Preferred Stock
under the constructive sale provisions
of the Code;
?
A U.S. person whose "functional currency" is not the U.S. dollar; or
?
A U.S. expatriate or former long-term resident.
In addition, this discussion is limited to persons that purchase
the Shares or Redeemable Preferred Stock in this
offering for cash and that hold the Shares or Redeemable Preferred
Stock as "capital assets" within the meaning of
Section 1221 of the Code (generally, property held for investment).
This discussion does not address the effect of
any applicable state, local, non-U.S. or other tax laws, including
gift and estate tax laws.
As used herein, "U.S. Holder" means a beneficial owner of the Shares
or Redeemable Preferred Stock this is, for
U.S. federal income tax purposes:
?
an individual who is a citizen or resident of the U.S.;
?
a corporation (or other entity treated as a corporation for US.
Federal income tax purposes) created or
organized in or under the laws of the U.S., any state thereof or
the District of Columbia;
?
an estate, the income of which is subject U.S. federal income tax
regardless of its source; or
?
a trust (1) is subject to the primary supervision of a U.S.
court and the control of one or more U.S persons
that have the authority to control all substantial decision of
the trust, or (2) has a valid election in effect
under applicable Treasury Regulations to be treated as a U.S.
person.
If an entity treated as a partnership for U.S. federal income
tax purposes holds the Shares or Redeemable Preferred
Stock, the tax treatment of an owner of the entity generally
will depend upon the status of the particular owner and
the activities of the entity. If you are an owner of an entity
treated as a partnership for U.S. federal income tax
purposes, you should consult your tax advisor regarding the tax
consequences of the purchase, ownership and
disposition of the Shares or Redeemable Preferred Stock.
We have not sought and will not seek any rulings from the IRS
with respect to the matters discussed herein. There
can be no assurance that the IRS will not take a different
position concerning the tax consequences of the purchase,
ownership or disposition of the Shares or Redeemable Preferred
Stock or that any such position would not be
sustained.
ADDITIONAL INFORMATION
We have filed with the SEC a Regulation A Offering Statement on
Form 1-A under the Securities Act of 1993, as
amended, with respect to the Shares and Shares offered hereby.
This Offering Circular, which constitutes a part of
the Offering Statement, does not contain all of the information
set forth in the Offering Statement or the exhibits and
schedules filed therewith. For further information about us and
the Shares and Shares offered hereby, we refer you
to the Offering Statement and the exhibits and schedules filed
therewith. Statements contained in this Offering
Circular regarding the contents of any contract or other document
that is filed as an exhibit to the Offering Statement
are not necessarily complete, and each such statement is qualified
in all respects by reference to the full text of such
contract or other document filed as an exhibit to the Offering
Statement. Upon the completion of this Offering, we
will be required to file periodic reports, proxy statements, and
other information with the SEC pursuant to the
Securities Exchange Act of 1934. You may read and copy this
information at the SEC's Public Reference Room,
100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may
obtain information on the operation of the
Public Reference Room by calling the SEC at 1-800-SEC-0330.
The SEC also maintains an Internet website that
contains reports, proxy statements and other information
about issuers, including us, that file electronically with the
SEC. The address of this site is www.sec.gov.
FINANCIALS
Entrex Production and Installation Company, Inc.
Balance Sheet
August 15,
2024
Assets
Current assets:
Line of Credit from Entrex Carbon Market, Inc
$
0
Prepaid services
0
Total assets
$
0
Liabilities and Shareholders' Deficit
Liabilities:
Note payable, related party
$
0
Total liabilities
0
Shareholders' deficit:
Common stock, no par value, 1,000,000 shares authorized, and
100,000 issued and outstanding at
Sept 15, 2024
-
Common stock to be issued
TBD
Deficit
0
Total shareholders' deficit
-
Total liabilities and shareholders' deficit
$
0
Entrex Production and Installation Company, Inc.
Statement of Operations
For the
period
from
Inception
through
August 15,
2024
Revenue:
Sales
$
-
Total revenue
-
Expenses:
General and administrative expense
0
Net income (loss) before income taxes
0
Provision for income taxes
-
Net loss
$
0
Net loss per common share - basic and diluted
$
0
Weighted average shares outstanding - basic and diluted
0
NOTE 1: BUSINESS
The Entrex Production and Installation Company's mission
is to buy operational Bitcoin mining facilities from
development partners. This strategic approach mitigates
risks and leverages the expertise of partners who have
previously managed and facilitated roll-ups of diversified
industries. EPIC's innovative model not only addresses
significant pain points in both industries but also offers
substantial financial returns and environmental benefits
through carbon offsets.
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company recognizes revenue from its Bitcoin mining
operations when the performance obligation is satisfied
and control of the cryptocurrency is transferred to the
customer, consistent with Generally Accepted Accounting
Principles (GAAP). Revenue is measured based on the transaction
price agreed upon with customers. The Company
follows the guidance provided under ASC 606 for revenue
recognition, which aligns revenue with the completion of
each mining block and the verification of transactions on
the blockchain.
The Company also complies with GAAP in its accounting for
digital assets and follows the principles for
recognizing the fair value of Bitcoin at the time of receipt,
classifying it as an intangible asset on the balance sheet.
For tax purposes, the Company follows Internal Revenue Code
guidelines for recognizing income generated from
cryptocurrency transactions and adheres to applicable federal
and state tax laws.
The accompanying financial statements of Entrex Production and
Installation Company, Inc. have been prepared by
our external accountant and have been prepared in accordance with
accounting principles generally accepted in the
United States of America ("GAAP") and the rules of the Securities
and Exchange Commission ("SEC"). In the
opinion of management, the statements represent a fair presentation
of financial position presented have been
reflected herein.
Revenue Recognition
The Company had no revenue since incorporation August 15, 2024,
Revenue shall commence upon the acquisition
of the targeted data mining facilities.
The Company intends to derive its revenue primarily from the
acquisition and operation of mobile Bitcoin mining
facilities powered by stranded natural gas wells.
Effective December 31, 2023, the Company adopted Accounting
Standards Update (ASU) 2014-09, Revenue from
Contracts with Customers - Topic 606, along with all subsequent
ASUs that modified ASC 606. The implementation
of this new standard had no material impact on the measurement
or recognition of revenue for the current or prior
periods presented. Revenue generated from interest income,
including facility fees, origination fees, and due
diligence fees, are outside the scope of ASC 606.
Contracts are valued at a fixed price at inception and do not
include any variable consideration or financing components
in our normal course of business. In applying judgment,
the Company considers customer expectations of performance,
materiality, and the core principles of Accounting
Standards Codification ("ASC") Topic 606, Revenue from Contract
s with Customers.
The Company recognizes revenue from participation fees under
ASC 606. Revenue from participation fees is
recognized at a point in time when the right to consideration
becomes unconditional and the Company has no
remaining performance obligations. Generally, the Company
invoices customers for participation fees once these
conditions are met.
Income Taxes
The Company accounts for income taxes under the provisions of
ASC 740 Accounting for Income Taxes, which
requires a company to first determine whether it is more likely
than not (which is defined as a likelihood of more
than fifty percent) that a tax position will be sustained based
on its technical merits as of the reporting date,
assuming that taxing authorities will examine the position and
have full knowledge of all relevant information. A tax
position that meets this more likely than not threshold is then
measured and recognized at the largest amount of
benefit that is greater than fifty percent likely to be realized
upon effective settlement with a taxing authority.
Deferred income taxes are recognized for the tax consequences
related to temporary differences between the
carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for tax purposes at
each year-end, based on enacted tax laws and statutory tax
rates applicable to the periods in which these differences
are expected to affect taxable income. Deferred income taxes
are also recognized for carryforward losses that can be
utilized to offset future taxable income. A valuation allowance
is recognized when, based on the weight of all
available evidence, it is considered more likely than not that
all, or some portion, of the net deferred tax assets will
not be realized.
The Company evaluates its valuation allowance requirements
based on projected future operations, including the
expected performance of its mobile Bitcoin mining facilities.
When circumstances change and lead to a shift in
management's judgment about the recoverability of deferred tax
assets, the impact of the change on the valuation
allowance is reflected in current income. Income tax expense is
comprised of the sum of current income tax plus the
change in deferred tax assets and liabilities.
Earnings (loss) Per Share
Basic earnings (loss) per common share is computed based on the
weighted average number of shares of all classes
of common stock outstanding during the period. Diluted earnings
per common share is computed based on the
weighted average number of common shares outstanding during the
period increased, when applicable, by dilutive
common stock equivalents. When the Company has a net loss, dilutive
common stock equivalents are not included
as they would be anti-dilutive
NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic
740): Simplifying the Accounting for
Income Taxes, which is part of the FASB's initiative to reduce
complexity in accounting standards. The ASU
eliminates certain exceptions to the general principles of ASC 740,
Income Taxes, and simplifies income tax
accounting in several areas. The standard is effective for fiscal
periods beginning after December 15, 2020, with
early adoption permitted. The Company adopted this ASU as of
December 31, 2023
The Company does not believe that there are any other new accounting
pronouncements that have been issued that
might have a material impact on its financial position or results of
operations.
NOTE 3: SUSEQUENT EVENTS
In preparing these financial statements, management has evaluated
events and transactions for potential recognition
or disclosure through as/of inception of the company August 15, 2024.
The company is not aware of any events or transactions that would
impact the financial statements.
NOTE 4: LIQUIDITY AND GOING CONCERN
The Company has established the company for the benefit of potential
investors with the intent to purchase the
historically producing data mining facilities.
The Company has evaluated its ability to continue as a going concern
in accordance with ASC 205-40-50. As of
October 16, 2024, the Company reported no cash and no operations. In
light of this, management acknowledges that
there are significant risks regarding the Company's ability to meet
its obligations over the next 12 months. However,
management is actively seeking financing through this offering and
other capital sources, such as related party
transactions and institutional funding, to ensure the Company can
continue its operations. Without sufficient funding
from the offering or alternative financing sources, the Company may
face difficulties in sustaining its operations as a
going concern.
The Company has a $25,000 line of credit from a shareholder, which
carries no interest and is repayable upon the
Company generating sufficient operating cash flow.
NOTE 5: REPURCHASE NOTE
As of Founding, the Company entered into an agreement with Entrex
Carbon Market, Inc to acquire the net income
of the company for an amount equal to 11.6x net income for consideration.
Legal Proceedings
The Company is not presently a party to any legal proceedings.
SIGNATURES
Pursuant to the requirements of Regulation A, the issuer certifies
that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form 1-A and has duly
caused this offering statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Boca Raton,
Florida on October 17, 2024.
Entrex Production and Installation
Company, Inc.
By:
/s/ SWatkins/CEO
Exhibit I - By-laws
Exhibit II - Charter and Articles
Appendix A - Terms Clarification
Term
Clarification
Units
A "unit" refers to an individual, fully operational Bitcoin mining facility,
including the necessary hardware, infrastructure, and support systems.
Sites
"Sites" are the physical locations where Bitcoin mining units are deployed.
These are usually located near stranded natural gas wells that supply energy.
Mobile Data
Mining Facilities
These facilities are mounted on mobile platforms (e.g., trailers), enabling
easy transport between sites. They leverage stranded gas wells for power.
Bitcoin Mining
Facilities
These facilities consist of all components required for Bitcoin mining, such
as miners and cooling systems, designed to operate using energy from gas
wells.
Appendix B - CherAmi 100 Unit Contract
Appendix C - Moria Purchase Agreement
Appendix D - PickAxe Mining Letter of Intent
Appendix E - PickAxe Mining Letter of Intent