Laredo Oil, Inc. is an oil exploration and production company primarily engaged in the acquisition and exploration of mineral reserves, with a strategic focus on recovering stranded oil from mature oil fields using proprietary enhanced recovery methods known as underground gravity drainage (UGD). The UGD method uses conventional mining processes to establish a drilling chamber underneath an existing oil field, from which closely spaced wellbores are drilled directionally up into the reservoir, using residual radial pressure and gravity to drain the targeted reservoir. The company targets oil fields with a minimum of 25 million barrels of estimated recoverable oil and believes the costs of implementing UGD are significantly lower than other commonly used Enhanced Oil Recovery methods. The company also has secondary conventional oil drilling operations in Montana, where it has identified and acquired mineral property interests, though most of these leases have been abandoned or expired. The company holds a 50% interest in the Cat Creek oil field, which is recorded with no value on its financial statements.

The company operates in a highly competitive environment, competing with large, well-established exploration and production companies that possess substantially more capital resources. The company's operating results are largely impacted by competition in all areas of operation, including the acquisition of mature fields. The company's competitive advantage lies in its proprietary UGD technology and the specialized know-how, intellectual property, and operational experience gained through its prior work with Stranded Oil Resources Corporation (SORC), a wholly owned subsidiary of Alleghany Corporation. The company believes its UGD method is applicable to mature oil fields with very specific geological and reservoir characteristics, and it has identified oil fields within the United States and globally that it believes are applicable for UGD recovery methods.

The company generates revenue through its interest in oil and gas sales, though this is currently minimal. Historically, the company's revenues came from management fees and reimbursements from SORC for managing the acquisition and operation of mature oil fields in Kansas, Wyoming, and Louisiana. The company's primary business model is to acquire mature oil fields, continue operating the producing fields to generate revenue, and then implement UGD production once the underground chamber is developed. The company also pursues conventional oil well drilling in Montana as a secondary activity. The company's business model requires substantial investment to acquire access to and develop oil and gas properties for production.

The company's primary focus is the pursuit of UGD projects globally, with active discussions in Argentina, Mexico, the Middle East and Northern Africa region (MENA), Romania, Albania, and Azerbaijan. The company has met with officials from the United States Embassy in Mexico City and conducted visits to several MENA countries, Romania, and Albania. No agreements have been consummated as of the filing date, but discussions are ongoing. Domestically, the company is in the process of raising funds to develop possible oil fields in Texas that are compatible with the UGD method. The company also formed a Texas registered entity, Laredo Mex, LLC, on November 19, 2025, to manage any future operations in Mexico, though no transactions have been incurred by this entity to date.

The company's conventional drilling operations in Montana have been largely unsuccessful. As of May 31, 2026, five wells have been drilled in the Lustre and Midfork fields, none of which have been economically successful due primarily to encountering excess water. The company has abandoned most of the leased mineral property interests acquired in the area and disposed of its ownership in Hell Creek Crude LLC on November 15, 2025, terminating any further drilling projects in the area. As of September 14, 2026, the company has 2,945 net acres of mineral property interests located in Montana. The company also has a 50% interest in the Cat Creek oil field, which is recorded with no value on its financial statements.

During fiscal year 2026, the company sold 9,056,415 shares of its common stock to accredited investors at an average price of $0.455 per share for gross proceeds of $4,157,669. The company also issued stock in exchange for debt repayments, resulting in a loss on conversion of $591,919. The company recognized a net loss from discontinued operations totaling $52,340 related to the sale of Hell Creek Crude effective November 15, 2025. The company's cash and cash equivalents and restricted cash balance increased to $420,676 as of May 31, 2026, from $249,409 as of May 31, 2025.

The company's financial performance reflects its early-stage development and ongoing investment in its UGD business model. For the year ended May 31, 2026, the company recognized revenues of $3,141, compared to $9,423 in the prior year. Operating expenses from continuing operations increased significantly to $7,049,571 from $2,596,797, driven by increases in legal, public relations, travel expenses, stock-based compensation, and a loss on conversion. The company reported a net loss from continuing operations of $7,919,331 for fiscal 2026, compared to a net loss of $2,448,590 in fiscal 2025. The company's accumulated deficit stood at $33,877,040 as of May 31, 2026, and the company has substantial doubt about its ability to continue as a going concern.

The company's management has not provided specific quantitative revenue, margin, or EPS guidance for the upcoming period. The company's forward-looking statements are based on beliefs and assumptions made by management using information currently available, and actual results may vary materially due to various risks and uncertainties.

The primary growth vector for the company is the pursuit of UGD projects internationally. The company is actively pursuing opportunities in Argentina, Mexico, the MENA region, Romania, Albania, and Azerbaijan by engaging in conversations with government officials and industry participants. The company believes the environment and interest for UGD has increased, driven by the continued production decline of older depressurized oil fields. The company has met with officials from the United States Embassy in Mexico City and conducted visits to several MENA countries prior to the conflict in the region between the United States and Iran. No agreements have been consummated as of the filing date, but discussions are ongoing.

Another growth vector is the domestic development of oil fields in Texas that are compatible with the UGD oil recovery method. The company is in the process of raising funds to develop these fields, though there is no assurance of success. The company also continues to evaluate the Olfert 11-4 well in Montana, which has been shut-in for three years pending gaining access to a proximate salt-water disposal well, with the plan to bring it into production if economical. The company's subsidiary, Laredo Mex, LLC, was formed to manage any future operations in Mexico, and dialogue continues with potential Mexican partners.

The company's cost structure is expected to evolve as it continues to invest in its UGD business model, which requires substantial investment to acquire access to and develop oil and gas properties for production. The company has experienced significant increases in operating expenses, including legal, public relations, and travel expenses related to pursuing UGD opportunities internationally. The company also incurred a $348,393 long-term asset impairment loss in fiscal 2026, primarily comprised of $232,774 expired property leases and $110,525 oil and gas assets no longer utilized. The company is focused on controlling overhead and expenses as part of its plan to sustain operations.

The company's operational outlook is centered on its UGD projects and the development of its mineral properties. The company has abandoned most of its leased mineral property interests in Montana and has terminated further drilling projects in the area following the disposal of Hell Creek Crude LLC. The company's conventional drilling operations have been largely unsuccessful, with wells shut-in due to excess water or uneconomical production. The company's priority is seeking UGD projects globally, and it is actively engaged in due diligence discussions and visits with industry participants in Argentina and Mexico.

The company's capital allocation strategy is focused on raising funds to support its UGD business model and maintain operations. During fiscal year 2026, the company sold 9,056,415 shares of common stock for gross proceeds of $4,157,669. The company also issued stock in exchange for debt repayments, resulting in a loss on conversion of $591,919. The company has not paid any dividends on its common stock since inception, and its board of directors does not anticipate declaring dividends in the foreseeable future. The company's management has undertaken steps to raise funds through the issuance of debt to fund its well development program and maintain operations.

The company faces significant headwinds and constraints, including the lack of economically successful wells in its conventional drilling operations. The company's five wells drilled in the Lustre and Midfork fields have not been economically successful due to excess water. The company's UGD projects are still in the discussion phase, with no agreements consummated. The company also faces challenges in raising funds, as evidenced by its inability to raise $7.5 million to drill planned exploratory wells in the West Fork area. The company's management has concluded that there is substantial doubt about its ability to continue as a going concern within one year of the issuance date of the financial statements.

The company's operations are subject to extensive government regulation, including environmental laws and regulations, which increase the cost of doing business. The company must comply with regulations from federal and state agencies, including the Mine Safety and Health Administration, the Federal Energy Regulatory Commission, the Environmental Protection Agency, and the Bureau of Land Management. The company's failure to comply with these regulations may result in substantial penalties. The company also faces risks related to oil and gas price volatility, which has been broad over the last two years beginning on June 1, 2024.

Management's message to shareholders emphasizes the company's focus on developing its UGD business model and pursuing international opportunities. The company is actively pursuing UGD opportunities in Argentina, Mexico, the MENA region, Romania, Albania, and Azerbaijan, and believes the environment and interest for UGD has increased. Management has also highlighted the company's efforts to raise funds through stock sales and debt issuances, with the sale of 9,056,415 shares of common stock for gross proceeds of $4,157,669 during fiscal year 2026. The company's strategic priorities include controlling overhead and expenses, raising funds connected with specific well development, and raising funds through notes payable and convertible debt to expand and fund property acquisitions, exploration, and development. Management has acknowledged the company's going concern uncertainty and has undertaken steps to sustain operations for the next twelve months and beyond.

For the fiscal year ended May 31, 2026, the company recognized total revenues of $3,141, compared to $9,423 in the prior year. The company reported a net loss from continuing operations of $7,919,331 for fiscal 2026, compared to a net loss of $2,448,590 in fiscal 2025. Net loss per share from continuing operations, basic and diluted, was $(0.10) for fiscal 2026, compared to $(0.03) in fiscal 2025. The company's operating loss for fiscal 2026 was $7,046,430, compared to an operating loss of $2,587,374 in fiscal 2025. Total operating expenses increased to $7,049,571 in fiscal 2026 from $2,596,797 in fiscal 2025. The company's cash and cash equivalents and restricted cash balance was $420,676 as of May 31, 2026, compared to $249,409 as of May 31, 2025. Total debt outstanding was $3,573,056 as of May 31, 2026, compared to $3,966,351 as of May 31, 2025. The company's accumulated deficit was $33,877,040 as of May 31, 2026, compared to $25,905,369 as of May 31, 2025. The company's net loss for fiscal 2026 was $7,971,671, compared to a net loss of $3,181,874 in fiscal 2025. The company's net loss from discontinued operations was $52,340 for fiscal 2026, compared to $733,284 in fiscal 2025. The company's interest expense, net, was $888,864 for fiscal 2026, compared to $489,918 in fiscal 2025. The company's stock-based compensation expense was $2,287,282 for fiscal 2026. The company's impairment expense was $348,393 for fiscal 2026, compared to $21,716 in fiscal 2025. The company's lease operating expense was $37,960 for fiscal 2026, compared to $138,853 in fiscal 2025. The company's general, selling, and administrative expenses were $4,933,624 for fiscal 2026, compared to $1,832,546 in fiscal 2025. The company's consulting and professional services expenses were $1,729,594 for fiscal 2026, compared to $603,682 in fiscal 2025. The company's other non-operating income was $15,963 for fiscal 2026, compared to $628,702 in fiscal 2025. The company's weighted average number of basic and diluted common shares outstanding was 77,113,818 for fiscal 2026, compared to 73,605,387 in fiscal 2025. The company's net cash used in operating activities was $3,127,716 for fiscal 2026, compared to $1,413,370 in fiscal 2025. The company's net cash provided by financing activities was $3,304,143 for fiscal 2026, compared to $2,379,676 in fiscal 2025. The company's net cash used in investing activities was $20,000 for fiscal 2026, compared to $794,521 in fiscal 2025. The company's cash paid for interest expense was $299,370 for fiscal 2026, compared to $83,002 in fiscal 2025. The company's cash paid for income taxes was $0 for both fiscal 2026 and 2025. The company's depreciation expense was $40,811 for fiscal 2026, compared to $27,213 in fiscal 2025. The company's amortization of debt discount was $272,764 for fiscal 2026, compared to $83,733 in fiscal 2025. The company's loss on conversion was $591,919 for fiscal 2026. The company's impairment of long-term assets was $343,299 for fiscal 2026, compared to $21,716 in fiscal 2025. The company's impairment of equity investment was $5,094 for fiscal 2026. The company's loss on disposal of assets was $303 for fiscal 2026. The company's net loss on discontinued operations was $733,284 for fiscal 2025. The company's gain on sale of membership interest in HCC was $272,892 for fiscal 2026. The company's relative fair value of warrants granted with debt was $204,716 for fiscal 2026, compared to $19,686 in fiscal 2025. The company's gain on investment in oil and gas properties – related party was $510,800 for fiscal 2025. The company's initial asset retirement obligation and related liability was $124,024 for fiscal 2025. The company's reclassification of contingent liability to convertible debt was $648,317 for fiscal 2025. The company's exercise of warrant in exchange for debt and related interest repayment was $628,814 for fiscal 2026. The company's sale of stock in exchange for debt and related interest repayment was $888,619 for fiscal 2026. The company's issuance of common stock in exchange for note payable was $50,000 for fiscal 2025. The company's proceeds from sale of common stock were $2,634,800 for fiscal 2026. The company's proceeds from exercise of warrants were $5,436 for fiscal 2026. The company's repayment of convertible debt was $119,706 for fiscal 2025. The company's proceeds from promissory notes were $1,275,000 for fiscal 2026, compared to $200,000 in fiscal 2025. The company's repayment of promissory notes was $99,750 for fiscal 2026. The company's proceeds from bridge notes were $200,000 for fiscal 2026, compared to $384,000 in fiscal 2025. The company's repayment of bridge notes was $399,614 for fiscal 2026, compared to $233,136 in fiscal 2025. The company's PPP loan repayments were $61,729 for fiscal 2026, compared to $66,682 in fiscal 2025. The company's proceeds from prefunded drilling costs were $2,250,000 for fiscal 2025. The company's repayment of prefunded drilling costs was $250,000 for fiscal 2026, compared to $1,250,000 in fiscal 2025. The company's net increase in cash and cash equivalents from continuing operations was $156,427 for fiscal 2026, compared to $171,785 in fiscal 2025. The company's cash and cash equivalents at beginning of period were $249,409 for fiscal 2026, compared to $127,624 in fiscal 2025. The company's net cash provided by operating activities from discontinued operations was $14,840 for fiscal 2026, compared to $1,598,143 in fiscal 2025. The company's net cash used in investing activities from discontinued operations was $2,379,643 for fiscal 2025. The company's net cash used in financing activities from discontinued operations was $731,500 for fiscal 2025. The company's net cash provided by discontinued operations was $14,840 for fiscal 2026, compared to $50,000 used in fiscal 2025. The company's cash and cash equivalents and restricted cash at end of period were $420,676 for fiscal 2026, compared to $249,409 in fiscal 2025. The company's oil and gas acquisition costs in accounts payable were $73,598 for fiscal 2025. The company's transfer of oil and gas assets to investment in entity – related party was $643,225 for fiscal 2026. The company's gain on sale of membership interest in HCC – related party was $272,892 for fiscal 2026. The company's relative fair value of warrants granted with debt was $204,716 for fiscal 2026, compared to $19,686 in fiscal 2025. The company's gain on investment in oil and gas properties – related party was $510,800 for fiscal 2025. The company's initial asset retirement obligation and related liability was $124,024 for fiscal 2025. The company's reclassification of contingent liability to convertible debt was $648,317 for fiscal 2025. The company's exercise of warrant in exchange for debt and related interest repayment was $628,814 for fiscal 2026. The company's sale of stock in exchange for debt and related interest repayment was $888,619 for fiscal 2026. The company's issuance of common stock in exchange for note payable was $50,000 for fiscal 2025. The company's total assets were $1,212,436 as of May 31, 2026, compared to $1,448,018 as of May 31, 2025. The company's total liabilities were $14,141,944 as of May 31, 2026, compared to $14,020,333 as of May 31, 2025. The company's total stockholders' deficit was $12,929,508 as of May 31, 2026, compared to $12,572,315 as of May 31, 2025. The company's current assets were $492,039 as of May 31, 2026, compared to $298,523 as of May 31, 2025. The company's current liabilities were $13,221,198 as of May 31, 2026, compared to $12,909,540 as of May 31, 2025. The company's noncurrent liabilities were $920,746 as of May 31, 2026, compared to $1,110,793 as of May 31, 2025. The company's property and equipment, net, was $67,172 as of May 31, 2026, compared to $1,109,495 as of May 31, 2025. The company's oil and gas acquisition and drilling costs were $0 as of May 31, 2026, compared to $1,001,209 as of May 31, 2025. The company's investment in entity – related party was $643,225 as of May 31, 2026. The company's other assets were $10,000 as of May 31, 2026, compared to $30,000 as of May 31, 2025. The company's accounts payable were $2,813,598 as of May 31, 2026, compared to $2,027,487 as of May 31, 2025. The company's accounts payable and accrued liabilities – related party were $604,243 as of May 31, 2026, compared to $402,344 as of May 31, 2025. The company's accrued payroll liabilities were $3,719,601 as of May 31, 2026, compared to $3,752,527 as of May 31, 2025. The company's accrued interest was $724,792 as of May 31, 2026, compared to $656,460 as of May 31, 2025. The company's deferred well development costs were $2,549,260 as of May 31, 2026, compared to $2,799,260 as of May 31, 2025. The company's convertible debt contributed for net working interest was $575,000 as of both May 31, 2026 and 2025. The company's bridge securities, net of debt discount, were $202,261 as of May 31, 2026, compared to $352,478 as of May 31, 2025. The company's promissory note, net of debt discount, was $0 as of May 31, 2026, compared to $181,349 as of May 31, 2025. The company's revolving note was $1,060,061 as of both May 31, 2026 and 2025. The company's note payable – related party was $292,099 as of both May 31, 2026 and 2025. The company's note payable – Alleghany, net of debt discount, was $617,934 as of both May 31, 2026 and 2025. The company's note payable, current portion, was $62,349 as of May 31, 2026, compared to $61,729 as of May 31, 2025. The company's asset retirement obligation was $157,394 as of both May 31, 2026 and 2025. The company's long-term note, net of current portion, was $763,352 as of May 31, 2026, compared to $825,701 as of May 31, 2025. The company's common stock, $0.0001 par value, 120,000,000 shares authorized, 84,244,558 and 74,771,476 issued and outstanding as of May 31, 2026 and 2025, respectively, was $8,424 and $7,477, respectively. The company's additional paid in capital was $20,939,108 as of May 31, 2026, compared to $13,275,577 as of May 31, 2025. The company's subscription paid in advance was $0 as of May 31, 2026, compared to $50,000 as of May 31, 2025. The company's accumulated deficit was $33,877,040 as of May 31, 2026, compared to $25,905,369 as of May 31, 2025. The company's total stockholders' deficit was $12,929,508 as of May 31, 2026, compared to $12,572,315 as of May 31, 2025. The company's total liabilities and stockholders' deficit were $1,212,436 as of May 31, 2026, compared to $1,448,018 as of May 31, 2025. The company's receivables - related party were $37,500 as of May 31, 2026. The company's prepaid expenses and other current assets were $33,863 as of May 31, 2026, compared to $21,156 as of May 31, 2025. The company's assets of discontinued operations were $0 as of May 31, 2026, compared to $27,958 as of May 31, 2025. The company's non-current assets of discontinued operations were $0 as of May 31, 2026, compared to $10,000 as of May 31, 2025. The company's liabilities of discontinued operations were $0 as of May 31, 2026, compared to $130,812 in current liabilities and $127,698 in noncurrent liabilities as of May 31, 2025. The company's total current assets were $492,039 as of May 31, 2026, compared to $298,523 as of May 31, 2025. The company's total property and equipment, net, was $67,172 as of May 31, 2026, compared to $1,109,495 as of May 31, 2025. The company's total assets were $1,212,436 as of May 31, 2026, compared to $1,448,018 as of May 31, 2025. The company's total current liabilities were $13,221,198 as of May 31, 2026, compared to $12,909,540 as of May 31, 2025. The company's total noncurrent liabilities were $920,746 as of May 31, 2026, compared to $1,110,793 as of May 31, 2025. The company's total liabilities were $14,141,944 as of May 31, 2026, compared to $14,020,333 as of May 31, 2025. The company's total stockholders' deficit was $12,929,508 as of May 31, 2026, compared to $12,572,315 as of May 31, 2025. The company's total liabilities and stockholders' deficit were $1,212,436 as of May 31, 2026, compared to $1,448,018 as of May 31, 2025.

The company faces substantial doubt about its ability to continue as a going concern, having incurred losses since inception and with an accumulated deficit of $33,877,040 as of May 31, 2026. The company's total debt outstanding was $3,573,056 as of May 31, 2026, including $617,934 owed to Alleghany that is in default and a $750,000 note payable to Cali Fields LLC that is in default. The company's conventional drilling operations have been unsuccessful, with five wells drilled in the Lustre and Midfork fields, none of which have been economically successful due to excess water. The company's UGD projects are still in the discussion phase, with no agreements consummated, and the company's ability to generate revenue is uncertain. The company's operations are subject to extensive government regulation and environmental laws, which increase costs and may result in substantial penalties. The company's internal control over financial reporting is ineffective due to a material weakness related to a lack of segregation of duties and limited accounting personnel. The company is also subject to legal proceedings, including judgments against Lustre for $354,267.29 plus interest and $326,650 plus interest, with ongoing payment arrangements.