NASDAQ: MGRX

As
of December 31, 2025, we had $16,089,573 in total assets, $890,568 in total liabilities, working capital of $0.7 million and a total
accumulated deficit of $39.4 million.

We
have mainly relied on related party loans, funds raised through the sale of securities, mainly through the private placement offerings,
our initial public and our subsequent follow on offering, discussed below, and revenues generated from sales of our Pharmaceutical Products,
to support our operations since inception. We have primarily used our available cash to pay operating expenses. We do not have any material
commitments for capital expenditures.

We
have experienced recurring net losses since inception. We believe that we will continue to incur substantial operating expenses in the
foreseeable future as we continue to invest to market and sell our Pharmaceutical Products and to attract customers, expand the product
offerings and enhance technology and infrastructure. These efforts may prove more expensive than we anticipate, and we may not succeed
in generating commercial revenues or net income to offset these expenses. Accordingly, we may not be able to achieve profitability, and
we may incur significant losses for the foreseeable future. Our independent registered public accounting firm included an explanatory
paragraph in its report on our consolidated financial statements as of December 31, 2025. As of December 31, 2025, our current
capital resources, combined with the net proceeds from the offering, are not expected to be sufficient for us to fund operations for
the next 12 months. We need to raise funding to support our operations in the future. We may also seek to acquire additional businesses
or assets in the future, which may require us to raise funding. We currently anticipate such funding being raised through the offering
of debt or equity. Such additional financing, if required, may not be available on favorable terms, if at all. If debt financing is available
and obtained, our interest expense may increase and we may be subject to the risk of default, depending on the terms of such financing.
If equity financing is available and obtained it may result in our shareholders experiencing significant dilution. If such financing
is unavailable, we may be forced to curtail our business plan, which may cause the value of our securities to decline in value. Additionally,
we may receive funding upon the exercise of outstanding warrants from time to time, which exercises may cause dilution to existing shareholders.

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To
support our existing operations or any future expansion of business, including the ability to execute our growth strategy, we must have
sufficient capital to continue to make investments and fund operations. We have plans to pursue an aggressive growth strategy for the
expansion of operations through marketing to attract new customers for our Pharmaceutical Products.

Cash
Flows

Year ended

December 31, 2025

Year ended

December 31, 2024

Cash (used in)provided by:

Operating activities
$(5,850,255)
$(4,863,776)

Investing activities
—
65,000

Financing activities
7,270,855
4,128,268

Net increase (decrease) in cash equivalents
$1,420,600
$(670,508)

Net
cash used in operating activities was $5,850,255 for the year ended December 31, 2025, which was mainly due to $20,643,455
of net loss, offset by $10,716,692 of common stock issued for services, $1,168,280 of options vested for stock-based compensation,
$600,552 of amortization of licensing agreement, $1,122,639 of amortization of intangible assets and impairment of license agreement of $1,239,942.

Net
cash used in operating activities was $4,863,776 for the year ended December 31, 2024, which was mainly due to $8,707,226 of
net loss, offset by $2,106,265 of common stock issued for services, and $696,736 of accounts payable and accrued liabilities related
parties.

There
was no net cash used in investing activities for the year ended December 31, 2025. For the year ended December 31,
2024, net cash provided by investing activities of $65,000 was solely due to the sale of assets.

Net cash provided by financing activities was $7,270,855 for the year ended
December 31, 2025, which was mainly due to $4,625,355 of proceeds from sales of common stock, $927,000 of proceeds from exercise of warrants,
$1,150,000 of proceeds from collection of subscriptions receivable, $100,000 from the sale of Series B Convertible preferred stock for
cash, $175,000 borrowed from our Chief Executive Officer and Chairman, Jacob Cohen, and a note payable with a third party for $500,000.

Net
cash provided by financing activities of $4,128,268 for the year ended December 31, 2024, was due to $2,650,000 of proceeds
from the sale of Series B Convertible Preferred Stock, $1,328,268 of proceeds from the sale of common stock and $150,000 from proceeds
from borrowings on notes payable.

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Related
Party Loans and Advances

During
the year ended December 31, 2025, Mr. Cohen used his personal credit card for payments to a third-party vendor for services
rendered to the Company. The total amount outstanding as of December 31, 2025 was $0.

On
May 2, 2025, the Company borrowed $100,000 from The Tiger Cub Trust, which trust is controlled by the Company’s Chief Executive
Officer and Chairman, Jacob D. Cohen, and entered into a Promissory Note with Tiger Cub to evidence such loan, as discussed in greater
detail above

The
Tiger Cub Note has a principal balance of $100,000. The Tiger Cub Note bears interest at a rate of 18% per annum, compounded monthly,
and matures on the earliest of (i) May 2, 2026, (ii) acceleration upon an event of default at the option of the holder, or (iii) five
business days following the closing of a Qualified Financing, as discussed below.

The
Tiger Cub Note includes customary terms for promissory notes, including payment hierarchy, prepayment, default events, and remedies,
and customary representations and warranties of the parties and covenants of the Company.

The
Company may prepay the Tiger Cub Note at any time prior to maturity; however, any such prepayment will require a prepayment premium equal
to the Make Whole Amount (defined below), minus any accrued interest as of the prepayment date, which is also payable upon prepayment.
The “Make Whole Amount” is defined as an amount equal to the original principal amount of the Promissory Note, multiplied
by the standard interest rate (18%), designed to approximate the holder’s expected return over the full term of the Promissory
Note.

The
Tiger Cub Note also includes a mandatory prepayment provision requiring repayment of the entire outstanding amount, together with accrued
interest and a make-whole premium, within five business days following the closing of a Qualified Financing. A “Qualified Financing”
is defined in the Tiger Cub Note as any fundraising transaction completed after the Tiger Cub Note’s effective date, other than
a sale of notes on substantially similar terms as the Tiger Cub Note, undertaken primarily for the purpose of raising capital.

In
the event of default, including nonpayment, material breaches, insolvency events, or material adverse effects, the holder may declare
the outstanding obligations under the Tiger Cub Note immediately due and payable (in the event of bankruptcy such repayment obligation
is immediate, without notice) and immediately upon the occurrence of an event of default, without any required notice of, or action by,
holder, the principal amount of the Tiger Cub Note automatically increases to an amount equal to the then outstanding balance of the
Tiger Cub Note, plus the Make Whole Amount.

On,
and effective on July 21, 2025, the Company entered into an Agreement to Amend Promissory Note, with Tiger Cub, pursuant to which (a)
Tiger Cub and the Company agreed to amend and restate the Tiger Cub Note into an Amended and Restated Convertible Promissory Note; and
(b) the Company granted Tiger Cub warrants to purchase 50,000 shares of common stock. The Agreement to Amend included certain representations
and warranties to Tiger Cub. The A&R Tiger Cub Note amended and restated the Tiger Cub Note to (a) provide Tiger Cub the option to
convert the principal and accrued interest under the note into shares of common stock of the Company at a conversion price each to the
greater of (x) (1) $1.50; (2) if the A&R Tiger Cub Note was entered into prior to the close of market on the date entered into, the
greater of (i) the consolidated closing bid price, and the (ii) closing price, of the common stock of the Company on the last trading
day prior to the date the A&R Tiger Cub Note was entered into, plus $0.125; and (3) if the A&R Tiger Cub Note was entered into
after the close of market on the date entered into, the greater of (i) the consolidated closing bid price, and the (ii) closing price,
of the common stock of the Company on the date the A&R Tiger Cub Note was entered into, plus $0.125, and (y) the lowest price per
share of common stock which would not, under applicable rules of the Nasdaq Capital Market, require stockholder approval for such issuance
of common stock in connection with a conversion, taking into account all securities issuable in connection therewith—which conversion
price was $1.785; and (b) remove the Mandatory Prepayment requirement.

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The
Tiger Cub Warrants have an exercise price of $1.815 per share, a term through July 21, 2028 and cash only exercise rights.

On
December 4, 2025, the Company borrowed $75,000 from The Tiger Cub Trust, which trust is controlled by the Company’s Chief Executive
Officer and Chairman, Jacob D. Cohen, and entered into a Promissory Note with Tiger Cub to evidence such loan.

The
Promissory Note has a principal balance of $75,000. The Promissory Note bears interest at a rate of 18% per annum, compounded monthly,
and matures on the earliest of (i) December 4, 2026, (ii) acceleration upon an event of default at the option of the holder, or (iii)
five business days following the closing of a Qualified Financing, as discussed below.

The
Promissory Note includes customary terms for promissory notes, including payment hierarchy, prepayment, default events, and remedies,
and customary representations and warranties of the parties and covenants of the Company.

The
Company may prepay the Promissory Note at any time prior to maturity; however, any such prepayment will require a prepayment premium
equal to the Make Whole Amount (defined below), minus any accrued interest as of the prepayment date, which is also payable upon prepayment.
The “Make Whole Amount” is defined as an amount equal to the original principal amount of the Promissory Note, multiplied
by the standard interest rate (18%), designed to approximate the holder’s expected return over the full term of the Promissory
Note.

The
Promissory Note also includes a mandatory prepayment provision requiring repayment of the entire outstanding amount, together with accrued
interest and a make-whole premium, within five business days following the closing of a Qualified Financing. A “Qualified Financing”
is defined in the Promissory Note as any fundraising transaction completed after the Promissory Note’s effective date, other than
a sale of notes on substantially similar terms as the Promissory Note, undertaken primarily for the purpose of raising capital.

In
the event of default, including nonpayment, material breaches, insolvency events, or material adverse effects, the holder may declare
the outstanding obligations under the Promissory Note immediately due and payable (in the event of bankruptcy such repayment obligation
is immediate, without notice) and immediately upon the occurrence of an event of default, without any required notice of, or action by,
holder, the principal amount of the Promissory Note automatically increases to an amount equal to the then outstanding balance of the
Promissory Note, plus the Make Whole Amount.

Convertible
Debt

On
December 13, 2024, Cohen Enterprises entered into a Note Purchase Agreement with Mill End Capital Ltd. Pursuant to the Note Purchase,
Mill End Capital Ltd. (“Mill End”) purchased all of Cohen Enterprises rights under the Cohen Note, issued by the Company
as borrower, to Cohen Enterprises, Inc., which entity is owned by Jacob D. Cohen, the Chairman and Chief Executive Officer of the Company
(“Cohen Enterprises”), as lender, in the original amount of $150,000, in consideration for $150,000. The terms of
the note remain unchanged; however, the note was no longer considered a related party note.

On
January 15, 2025, the Company entered into a Debt Conversion Agreement with Mill End. Pursuant to the Debt Conversion Agreement, the
Company and Mill End agreed to convert the entire $150,000 owed by the Company under the Promissory Note, into an aggregate of 100,000
shares of restricted common stock of the Company, based on an agreed conversion price of $1.50 per share. Pursuant to the Debt Conversion
Agreement, which included customary representations and warranties of the parties, Mill End agreed that the shares of common stock issuable
in connection therewith were in full and complete satisfaction of amounts owed under the Converted Note.

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On
January 27, 2025, the Company entered into a First Amendment to Payment Plan Letter Agreement (the “1st Amendment”)
with MAAB Global Ltd. (“MAAB”). MAAB had previously purchased rights to $500,000 owed by the Company to Barstool Sports,
Inc. (“Barstool” and the “Debt”) on January 10, 2025, which amount was non-interest bearing, and
due pursuant to the terms of a Payment Plan Letter Agreement entered into between Barstool and the Company on August 27, 2024.

Pursuant
to the 1st Amendment, the Company and MAAB agreed to amend the terms of the Debt to allow MAAB the right, exercisable
at any time, to convert the $500,000 of Debt into shares of the Company’s common stock at a conversion price of $1.50 per share.

As
a result of the conversion of the Promissory Note, pursuant to the terms of the Debt Conversion Agreement, at a conversion price of $1.50
per share, the exercise price of those certain common stock warrants issued by the Company in connection with its December 2025 Series
B Convertible Preferred Stock offering (warrants to purchase up to 1,650,000 shares of common stock with exercise prices from between
$2.59 and $2.71 per share); and those certain common stock warrants to purchase 320,000 shares of common stock granted to the Purchaser
in connection with the SPA (with an exercise price of $2.53 per share), were automatically re-priced pursuant to the anti-dilutive terms
thereof, to have an exercise price equal to the Conversion Price of the Debt Conversion Agreement, $1.50 per share, effective upon the
date of the Debt Conversion Agreement.

Additionally,
as a result of the conversion of the Promissory Note, pursuant to the terms of the Debt Conversion Agreement, at a conversion price of
$1.50 per share, the conversion price of the Company’s Series B Preferred Stock was automatically adjusted, pursuant to the designation
of such Series B Preferred Stock, to have a conversion price of $2.25 per share, the floor price thereunder, effective upon the date
of the Debt Conversion Agreement.

On
April 2, 2025, MAAB converted the Debt into 333,333 shares of the Company’s common stock, at a conversion price of $1.50 per share,
pursuant to the terms of such Debt, as amended on January 27, 2025. The principal balance of the note as of September 30, 2025 is $-0-.

As
discussed in greater detail above, the Indigo Note was amended effective on May 27, 2025, to allow Indigo to convert such note into shares
of common stock of the Company at a conversion price of $1.50 per share and on July 16, 2025, Indigo converted the principal amount of
the A&R Indigo Note, and accrued interest due through maturity of $90,000, into an aggregate of 393,333 shares of common stock of
the Company at a conversion price of $1.50 per share, as set forth in the A&R Indigo Note.

As
discussed in greater detail above, on July 21, 2025, the Company and Tiger Cub agreed to amend the $100,000 principal Tiger Cub Note
to allow the conversion thereof into shares of common stock of the Company at a conversion price of $1.785 per share.

Funding
Arrangements

Follow
On Offering

On
December 15, 2023, we entered into an underwriting agreement (the “Underwriting Agreement”) with Boustead Securities,
LLC (“Boustead”), as representative of the underwriters named on Schedule 1 thereto (the “Underwriters”),
relating to a public offering of 266,667 shares of the Company’s common stock to the Underwriters at a purchase price to the public
of $4.50 per share and also granted to the Underwriters a 45-day option to purchase up to 40,000 additional shares of its common stock,
solely to cover over-allotments, if any, at the public offering price less the underwriting discounts (the “Follow On Offering”).

The
Follow On Offering closed on December 19, 2023. As a result, the Company sold 266,667 shares of its common stock for total gross proceeds
of $1.2 million.

The
net proceeds to the Company from the Offering, after deducting the underwriting discounts and commissions and offering expenses, were
approximately $1.0 million. The Company used the net proceeds from the Offering to finance the marketing and operational expenses associated
with its Mango ED and GROW hair growth products, to hire additional personnel to build organizational talent, to develop and maintain
software, and for working capital and other general corporate purposes.

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On
December 19, 2023, pursuant to the Underwriting Agreement, the Company issued a common stock purchase warrant to Boustead for the purchase
of 18,667 shares of common stock at an exercise price of $5.70, subject to adjustments. The warrant is exercisable at any time and from
time to time, in whole or in part, until December 14, 2029, and may be exercised on a cashless basis.

On
January 18, 2024, the Underwriters notified the Company that they were exercising their over-allotment option in full to purchase an
additional 40,000 shares of common stock, which sale closed on January 22, 2024. The net proceeds to the Company from the sale of the
40,000 shares of common stock, after deducting underwriting discounts and expenses, was approximately $160,000. Inclusive of the full
exercise of the over-allotment option, a total of 306,667 shares of common stock were issued and sold in the Offering.

On
January 22, 2024, pursuant to the Underwriting Agreement, the Company also issued a common stock purchase warrant to Boustead for the
purchase of 2,800 shares of common stock at an exercise price of $5.625, subject to adjustments. The warrant is exercisable at any time
and from time to time, in whole or in part, until December 14, 2028, and may be exercised on a cashless basis.

April
2024 Securities Purchase Agreement

Effective
April 5, 2024, the Company entered into a Securities Purchase Agreement (the “April 2024 SPA”) with an institutional
accredited investor (the “April 2024 Purchaser”), pursuant to which the Company agreed to sell up to 1,500 shares
of Series B Convertible Preferred Stock and warrants to purchase up to 220,000 shares of common stock for a total purchase price of $1.5
million, in multiple tranches, subject to certain conditions precedent. The initial closing included the sale of 500 shares of Series
B Convertible Preferred Stock and warrants to purchase up to 220,000 shares of common stock for $500,000. The April 2024 SPA was later
amended to revise the schedule of closings and amounts, expanding the total purchase amount to $2.5 million and the total value of preferred
stock to $2.75 million (2,500 shares of Series B Convertible Preferred Stock), and up to 320,000 warrants to purchase shares of common
stock.

Subsequent
closings occurred through mid-2024: the Company completed a second closing in two parts, receiving $250,000 for 250 shares of Series
B Convertible Preferred Stock in April and May 2024; on June 28, 2024, the Company conducted the third closing, selling 750 shares of
Series B Convertible Preferred Stock for $750,000 and issuing additional (a) warrants to purchase up to 66,667 shares of common stock
at an exercise price of $7.50 per share; and (b) warrants to purchase up to 33,333 shares of common stock at an exercise price of $15.00
per share. The warrants were subject to automatic price adjustments in case of stock splits or similar corporate actions, and their price
was ultimately adjusted to $1.50 per share due to such events.

Partial
closings of the fourth tranche occurred in August 2024 (500 shares of Series B Convertible Preferred Stock for $500,000) and September
2024 (250 shares of Series B Convertible Preferred Stock for $250,000), and finally in January 2025 (250 shares of Series B Convertible
Preferred Stock for $250,000), totaling an additional 1,000 shares of Series B Convertible Preferred Stock for $1 million.

Boustead
Securities, LLC served as the Company’s financial advisor in connection with the April 2024 SPA and related transactions.

During
the quarter ended June 30, 2024, the April 2024 Purchaser converted a total of 355 shares of Series B Convertible Preferred Stock into
128,245 shares of common stock, pursuant to the terms of the designation of the Series B Convertible Preferred Stock. These conversions
occurred at conversion prices at $3.05 per share.

During
the quarter ended September 30, 2024, the April 2024 Purchaser converted a total of 285 shares of Series B Convertible Preferred Stock
into 85,927 shares of common stock, pursuant to the terms of the designation of the Series B Convertible Preferred Stock. These conversions
occurred at conversion prices of between $3.21 and $4.90 per share.

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During
the quarter ended December 31, 2024, the April 2024 Purchaser converted a total of 390 shares of Series B Convertible Preferred Stock
into 160,222 shares of common stock, at conversion prices ranging from $2.36 to $3.12 per share, pursuant to the terms of the Series
B Convertible Preferred Stock.

During
the quarter ended March 31, 2025, holders of the Series B Convertible Preferred Stock converted 1,438 shares of Series B Convertible
Preferred Stock into 623,333 shares of common stock at a conversion price of $1.00 per share, pursuant to the terms of the Series B Convertible
Preferred Stock.

During
the quarter ended June 30, 2025, holders of the Series B Convertible Preferred Stock converted 850 shares of Series B Convertible Preferred
Stock into 1,001,733 shares of common stock at a conversion prices between $1.50 and $2.25 per share, pursuant to the terms of the Series
B Convertible Preferred Stock.

On
March 17, 2025, with the approval of the shareholders of the Company at the special meeting of shareholders held on the same date, the
Company submitted to the Secretary of the State of Texas, an amendment to the Certificate of Designations, Preferences and Rights of
Series B Convertible Preferred Stock of Mangoceuticals, Inc. (the “Series B Designation”), to: (a) reduce the conversion
price set forth therein to a fixed price of $1.50 per share (subject to customary adjustments for stock splits) (compared to having a
fixed conversion price of $2.25 prior to the amendment)(the “Conversion Price”); (b) reduce the floor price set forth
therein from $2.25 to $1.50 per share (subject to customary adjustments for stock splits)(the “Floor Price”); (c)
remove the dividend rights set forth therein (except for standard participatory rights for dividends declared on the Company’s
common stock); and exclude the Company’s current wholly-owned subsidiary, Mango & Peaches Corp. (“Mango & Peaches”),
from the definition of Change of Control Transaction thereunder (as a result, the issuance of securities of Mango & Peaches to Mr.
Jacob Cohen, the Company’s Chief Executive Officer and Chairman, will not be a Change of Control Transaction, trigger an event
of default under the Series B Preferred Stock or be deemed an Equity Condition (as defined in the designation of the Series B Preferred
Stock)(the “Designation Amendment”).

The
Company’s Series B Convertible Preferred Stock currently have the following rights and privileges:

●
Dividends:
Holders participate in dividends or distributions on common stock on an as-converted basis, excluding distributions solely of common
stock.

●
Prohibitions
on Variable Rate Transactions: The Company is restricted from entering into most variable rate transactions involving equity
securities while Series B Convertible Preferred Stock is outstanding, with limited exceptions such as equity lines of credit.

●
Liquidation
Preference: In a liquidation, holders of Series B Convertible Preferred Stock are entitled to the Stated Value of the Series
B Convertible Preferred Stock (initially, $1,100, subject to increases as discussed below) plus accrued dividends and other amounts,
prior to payments upon liquidation to junior securities.

●
Conversion
Rights: Shares of Series B Convertible Preferred Stock are convertible at the option of the holder at a fixed price of $1.50
per share.

●
Conversion
Limits: Holders cannot convert if such conversion would result in beneficial ownership exceeding 4.99% of the Company’s
outstanding common stock.

●
Limited
Voting Rights: The Series B Convertible Preferred Stock have no general voting rights, except as to specific protective provisions
requiring majority holder consent for certain corporate actions (e.g., amendments to rights, changes to Series B Convertible Preferred
Stock share count, and adverse charter amendments).

●
Events
of Default: Events of default under the designation of the Series B Convertible Preferred Stock include failure to deliver
conversion shares timely, insufficient reserved shares, breaches of covenants, bankruptcy, significant unsatisfied judgments, and
delisting or trading suspensions. Upon default, the Stated Value increases by 17.5%.

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●
Optional
Redemption: The Company may redeem 50% of outstanding Series B Convertible Preferred Stock shares and, with holder consent,
an additional 50%, subject to certain pricing thresholds based on timing from issuance (110%–120% of Stated Value plus accrued
amounts). Such redemptions may only take place of certain equity conditions are met, including that there must be a valid way for
holders to receive and resell shares (through a registration statement, Rule 144, or Section 3(a)(9)); shares must be actively trading
and expected to continue; enough authorized shares must be available; share issuance must not breach ownership limits; no uncompleted
major corporate changes should be pending; and the holder must not possess material non-public information from the Company.

ELOC

On
April 5, 2024, the Company entered into a $25 million Equity Purchase Agreement (the “ELOC”) with the April 2024 Purchaser,
under which the April 2024 Purchaser committed to buy up to $25 million of the Company’s common stock over a two-year period ending
no later than April 4, 2026. In exchange, for such commitment, the Company issued 66,667 commitment shares to the April 2024 Purchaser.

Following
the effectiveness of a Form S-1 registration statement on May 9, 2024, the Company may, from time to time, issue advance notices to sell
shares of common stock (the “Advance Shares”) to the April 2024 Purchaser. Each advance may be up to 100% of the average
daily trading volume over the prior five trading days, and priced at 90% of the April 2024 Purchaser’s resale proceeds from the
shares during the three-day valuation period after notice.

Sales
are subject to various conditions, including compliance with the agreement, no trading suspension, maintaining DWAC eligibility, a share
price above $0.15, and keeping the April 2024 Purchaser’s beneficial ownership below 4.99%. The Company is not obligated to issue
any shares and may terminate the ELOC at any time that the April 2024 Purchaser does not hold any Advance Shares.

On
June 10, 2025, the Company delivered Advance Notices to the Platinum Point Capital and sold Platinum Point Capital 261,667 shares of
common stock pursuant to the terms of the ELOC ranging from $1.43 to $1.79 per share for a total of $366,830, net of fees, discounts
and expenses.

As
of December 31, 2025, the Company has sold 666,667 shares of common stock under the ELOC for $1,787,580 in gross proceeds, and there
are no more shares remains available under the ELOC.

The
April 2024 Purchaser is prohibited from short selling during the commitment period, and the Company agreed to indemnify the April 2024
Purchaser and cover related expenses under the associated registration rights agreement.

Additional
Private Sales of Series B Preferred Stock and Common Stock

Effective
on December 18, 19, and 31, 2024 and January 3, 6 and 6, 2025, we agreed to definitive terms on Securities Purchase Agreements (the “December
2024 SPAs”), with certain institutional accredited investors (the “Purchasers”), pursuant to which the Company
sold the Purchasers, and the Purchasers purchased from the Company, 250 shares of Series B Preferred Stock for $250,000, and warrants
to purchase 330,000 shares of common stock with an exercise price of $2.71 per share, 100 shares of Series B Preferred Stock for $100,000,
and warrants to purchase 132,000 shares of common stock with an exercise price of $2.57 per share, 50 shares of Series B Preferred Stock
for $50,000, and warrants to purchase 60,000 shares of common stock, with an exercise price of $2.57 per share; 300 shares of Series
B Preferred Stock for $300,000, and warrants to purchase 396,000 shares of common stock with an exercise price of $2.61 per share; 500
shares of Series B Preferred Stock for $500,000, and warrants to purchase 660,000 shares of common stock with an exercise price of $2.59
per share; and 50 shares of Series B Preferred Stock for $50,000, and warrants to purchase 66,000 shares of common stock with an exercise
price of $2.59 per share, respectively. Each of the December 2024 SPAs closed on the dates they were entered into, and the warrants were
granted on the same dates.

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If
at any time following the Initial Exercise Date (as defined below) of the warrants, there is no effective registration statement registering,
or the prospectus contained therein is not available for the shares of common stock issuable upon exercise of the warrants, the warrants
can be exercised on a cashless basis as described in greater detail in the Common Share Purchase Warrants entered into to evidence the
warrants (the “Warrant Agreements”). The warrants are exercisable on or after 180 days from their grant date (“Initial
Exercise Date”), and for five years thereafter.

The
warrants contain provisions that prohibit exercise if the holder thereof, together with its affiliates, would beneficially own in excess
of 4.99% of the number of the Company’s shares of common stock outstanding immediately after giving effect to such exercise. A
holder of the warrants may increase or decrease this percentage, but not in excess of 9.99%, by providing at least 61 days’ prior
notice to the Company. In the event of certain corporate transactions, a holder of the Warrants will be entitled to receive, upon exercise
of the warrants, the kind and amount of securities, cash or other property that the holder would have received had it exercised the warrants
immediately prior to such transaction.

If
the Company or any subsidiary at any time while the warrants are outstanding, shall sell, enter into an agreement to sell or grant any
option to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any
option to purchase or other disposition) any common stock or common stock equivalents, at an effective price per share less than the
exercise price of the warrants then in effect (such lower price, the “Base Share Price” and such issuances collectively,
a “Dilutive Issuance”) then simultaneously with the consummation (or, if earlier, the announcement) of each Dilutive
Issuance the exercise price shall be reduced and only reduced to equal the Base Share Price. No adjustment however is to be made for
certain customary Exempt Issuances (as defined in the SPAs).

The
warrants also include customary buy-in rights in the event the Company fails to timely deliver the shares of common stock issuable upon
exercise thereof.

If
at any time the warrants are outstanding there occurs any share split, share dividend, share combination recapitalization or other similar
transaction involving the common stock (each, a “Share Combination Event”, and such date thereof, the “Share
Combination Event Date”) and the Event Market Price (defined below) is less than the then exercise price then in effect, then
on the sixth trading day immediately following such Share Combination Event Date, the exercise price then in effect on such sixth trading
day is automatically reduced (but in no event increased) to the Event Market Price. The “Event Market Price” means,
with respect to any Share Combination Event Date, the quotient determined by dividing (x) the sum of the volume weighted average price
of the common stock for each of the five trading days ending and including the trading day immediately preceding the sixth trading day
after such Share Combination Event Date, divided by (y) five.

As
a result of a dilutive issuance, the exercise price of the warrants was automatically reduced to $1.50 per share.

On
February 3, 2025, the Company entered into a Subscription Agreement with an accredited investor and sold 70,000 shares of the Company’s
restricted common stock for a total of $105,000, $1.50 per share. The Subscription Agreement included customary representations and warranties
of the purchaser and the Company.

On
February 7, 2025, the Company entered into a Subscription Agreement with an accredited investor and sold 155,555 shares of the Company’s
restricted common stock for a total of $350,000 (or $2.25 per share). The Subscription Agreement included customary representations and
warranties of the purchaser and the Company.

On
March 20, 2025, the Company entered into a Subscription Agreement pursuant to which the purchaser agreed to purchase 80,000 shares of
common stock of the Company’s restricted common stock from the Company for a total of $200,000 (or $2.50 per share). The Subscription
Agreement included customary representations and warranties of the Purchaser and the Company.

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On
May 23, 2025, the Company entered into two Subscription Agreements with two accredited investors (the “Investors”),
pursuant to which the Investors purchased an aggregate of 70,454 units, each consisting of one share of common stock and one half of
one warrant to purchase one share of common stock, for a total of $1.65 per unit. As a result of the subscriptions, the Company, in consideration
for $116,249 received from the Investors, issued 70,454 shares of common stock and warrants to purchase 35,227 shares of common stock
(the “Investor Warrants”) to the Investors. The Subscription Agreements included customary representations and warranties
of the Investors and the Company.

The
Investor Warrants have an exercise price of $3.00 per share, a term through May 23, 2028 and cash only exercise rights. The Investor
Warrants include a 4.999% beneficial ownership limitation, which may be increased to not more than 9.999% with not less than 61 days
prior written notice from each holder. The Investor Warrants also provide that the Company has the right to accelerate the expiration
of the Investor Warrants if the volume-weighted average price (VWAP) of the Company’s common stock on Nasdaq reaches or exceeds
$3.00 per share for five consecutive trading days, with written notice to the warrant holder within two trading days. The notice must
specify the trigger date, the relevant VWAP data, and an accelerated expiration date that is at least 30 calendar days from the date
the notice is given. If the Investor Warrants are not exercised by 5:00 p.m. (New York time) on the accelerated expiration date, they
will automatically expire and be of no further effect. In the event that the Company fails to provide an acceleration notice within two
trading days after the applicable acceleration trigger date, the rights of the Company continue to apply to future acceleration trigger
events, if any.

April
2025 Securities Purchase Agreement

On
April 11, 2025, the Company agreed to definitive terms on a Securities Purchase Agreement (the “April 2025 SPA”),
with an institutional accredited investor (the “April 2025 Purchaser”), pursuant to which the Company sold the April
2025 Purchaser, and the April 2025 Purchaser purchased from the Company: 100 shares of Series B Convertible Preferred Stock of the Company
(“Series B Preferred Stock”) for $100,000.

The
April 2025 SPA closed on April 11, 2025, and provided that until the 18th month anniversary of the closing date of the
April 2025 SPA, the April 2025 Purchaser has the right to participate in any issuance by the Company or any of its subsidiaries of common
stock or common stock equivalents or any offering of debt or any other type of financing, or a combination thereof (other certain customary
exempt issuances)(each a “Subsequent Financing”), in an amount not to exceed the amount of the April 2025 Purchaser’s
subscription, on the same terms, conditions and price provided for in the Subsequent Financing.

The
April 2025 SPA contains customary representations, warranties and covenants by the Company (including a restriction on entering into
any variable rate transaction for a period of 180 days from the closing date of the April 2025 SPA), customary conditions to closing,
indemnification obligations of the Company and the April 2025 Purchaser, other obligations of the parties and termination provisions.

December
2025 Securities Purchase Agreement

On
December 18, 2025, the Company entered into a securities purchase agreement (the “December 2025 SPA”) with an institutional
investor (the “December 2025 Investor”), pursuant to which the Company agreed to issue and sell to such investor (a)
in a registered direct offering, (A) 1,430,502 shares of common stock of the Company, at an offering price of $1.295 per share, and (B)
500,000 pre-funded warrants (the “Pre-Funded Warrants”) in lieu of shares of common stock, at an offering price of
$1.29499 per Pre-Funded Warrant (such registered direct offering, the “December 2025 Offering”), and (b) in a concurrent
private placement, common stock purchase warrants (the “Private Placement Warrants”), exercisable for an aggregate
of up to 1,930,502 shares of common stock, at an exercise price of $1.4245 per warrant share for aggregate gross proceeds of approximately
$2.5 million.

The
Pre-Funded Warrants were immediately exercisable and may be exercised at an exercise price of $0.00001 per warrant share at any time
until all of the Pre-Funded Warrants are exercised in full.

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The
Private Placement Warrants are exercisable upon issuance and expire on the fifth anniversary of the issuance date of the Private Placement
Warrants. Once issued, the Private Placement Warrants may be exercised, in certain circumstances, on a cashless basis pursuant to the
formula contained in the Private Placement Warrants. The Private Placement Warrants and the Pre-Funded Warrants contain ownership limitations
pursuant to which a holder does not have the right to exercise any portion of their warrants if it would result in the holder (together
with its affiliates) beneficially owning more than 4.99% (or, upon election by the holder prior to the issuance of any warrants, 9.99%)
of the Company’s outstanding common stock.

In
connection with the December 2025 Offering, the Company also entered into a placement agency agreement (the “Placement Agency
Agreement”) with Aegis Capital Corp. (the “Placement Agent”), pursuant to which the Company paid the Placement
Agent a cash fee equal to 7% of the aggregate gross proceeds of the December 2025 Offering and reimbursed the Placement Agent for certain
expenses and legal fees.

On
December 18, 2025, the Company and the December 2025 Investor entered into a registration rights agreement (the “Registration
Rights Agreement”), pursuant to which the Company agreed to file a registration statement (the “Resale Registration
Statement”), providing for the resale of the shares of common stock issued and issuable upon exercise of the Private Placement
Warrants within 30 days of the closing of the December 2025 Offering, to have such registration statement declared effective within 15
days of the filing date (or 45 days, if the Securities and Exchange Commission conducts a full review), and to maintain the effectiveness
of such registration statement.

The
common stock shares and the Pre-Funded Warrants were offered pursuant to a “shelf” registration statement on Form S-3 (File
No. 333-288039) that was declared effective by the Commission on June 24, 2025.

The
Resale Registration Statement was timely filed and was timely declared effective on January 28, 2025.

The
Company received gross proceeds of approximately $2.5 million from the December 2025 Offering, before deducting December 2025 Offering
expenses payable by the Company, including the Placement Agent’s commissions and fees. The Company intends to use the net proceeds
from the Offering for working capital and general corporate purposes.

Need
for Future Funding

As
discussed above, our current capital resources are not expected to be sufficient for us to fund operations for the next 12 months. We
believe we will need to raise additional funding to support our operations in the future. We may also seek to acquire additional businesses
or assets in the future, which may require us to raise funding. We currently anticipate such funding, if required, being raised through
the offering of debt or equity. Such additional financing, if required, may not be available on favorable terms, if at all. If debt financing
is available and obtained, our interest expense may increase and we may be subject to the risk of default, depending on the terms of
such financing. If equity financing is available and obtained it may result in our shareholders experiencing significant dilution. If
such financing is unavailable, we may be forced to curtail our business plan, which may cause the value of our securities to decline
in value.

Critical
Accounting Policies and Estimates

The
preparation of the Company’s financial statements in accordance with accounting principles generally accepted in the United States
of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets,
liabilities and expenses. “Note 2 - Summary of Significant Accounting Policies” to the unaudited financial statements
included in “Part I, Item 1. Financial Statements”, above describes the significant accounting policies used in the
preparation of the financial statements. Certain of these significant accounting policies and estimates have a higher degree of inherent
uncertainty and require significant judgments. Accordingly, actual results could differ from those estimates. To the extent that there
are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of
operations and cash flows will be affected.

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A
critical accounting policy is defined as one that is both material to the presentation of our financial statements and requires management
to make difficult, subjective or complex judgments that could have a material effect on our financial condition and results of operations.
Specifically, critical accounting estimates have the following attributes: (1) we are required to make assumptions about matters that
are highly uncertain at the time of the estimate; and (2) different estimates we could reasonably have used, or changes in the estimate
that are reasonably likely to occur, would have a material effect on our financial condition or results of operations.

Estimates
and assumptions about future events and their effects cannot be determined with certainty. We base our estimates on historical experience
and on various other assumptions believed to be applicable and reasonable under the circumstances. These estimates may change as new
events occur, as additional information is obtained and as our operating environment changes. These changes have historically been minor
and have been included in the financial statements as soon as they became known. Based on a critical assessment of our accounting policies
and the underlying judgments and uncertainties affecting the application of those policies, management believes that our consolidated
financial statements are fairly stated in accordance with GAAP and present a meaningful presentation of our financial condition and results
of operations. We believe the following critical accounting policies reflect our more significant estimates and assumptions used in the
preparation of our consolidated financial statements:

Share-Based
Compensation - Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of
Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718,
which requires recognition in the consolidated financial statements of the cost of employee and director services received in
exchange for an award of equity instruments over the shorter of period the employee or director is required to perform the services
in exchange for the award or the vesting period. ASC 718 also requires measurement of the cost of employee and director services
received in exchange for an award based on the grant-date fair value of the award. Pursuant to ASC 505-50, for share-based payments
to non-employees, compensation expense is determined at the “measurement date.” The expense is recognized over
the service period of the award. Until the measurement date is reached, the total amount of compensation expense remains uncertain.
The Company initially records compensation expense based on the fair value of the award at the reporting date. Additionally, we used
this same methodology when determining the fair value of our restricted common stock issuances to managers and other related
parties.

Estimating
the Fair Value of Common Stock - We are required to estimate the fair value of the common stock underlying our stock-based
awards and warrants when performing the fair value calculations using the Black-Scholes option pricing model

Our
determination of the fair value of stock options with time-based vesting on the date of grant utilizes the Black-Scholes option pricing
model, and is impacted by our common stock price as well as other variables including, but not limited to, expected term that options
will remain outstanding, expected common stock price volatility over the term of the option awards, risk-free interest rates and expected
dividends. Estimating the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes
option pricing model, is affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect
the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require
significant analysis and judgment to develop.

Warrants
- In accordance with ASC 480, the Company classifies as equity any contracts that (i) require physical settlement or
net-share settlement or (ii) gives the Company a choice of net-cash settlement in its own shares. The Company classifies as
liabilities any contracts that (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event
occurs and if that event is outside the control of the Company) or (ii) give the counterparty a choice of net-cash settlement or
settlement in shares.

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The
Company accounts for its currently issued warrants in conjunction with the Company’s ordinary shares in permanent equity. These
warrants are indexed to the Company’s stock and meet the requirements of equity classification as prescribed under ASC 815-40.
Warrants classified as equity are initially measured at fair value, and subsequent changes in fair value are not recognized so long as
the warrants continue to be classified as equity. The value of the warrant is based on accepted valuation procedures and practices that
rely substantially on the third-party professional’s use of numerous assumptions and its consideration of various factors that
are relevant to the operation of the Company.

JOBS
Act and Recent Accounting Pronouncements

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, 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. We have elected to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act,
for complying with new or revised accounting standards that have different effective dates for public and private companies until the
earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition
period provided in Section 7(a)(2)(B) of the Securities Act.

We
have implemented all new accounting pronouncements that are in effect and may impact our financial statements and we do not believe that
there are any other new accounting pronouncements that have been issued that might have a material impact on our financial position or
results of operations.

Recently
Issued Accounting Pronouncements

From
time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are
adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards,
which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

In
November 2023, the FASB issued Accounting Standards Update (ASU) No. 2023-07, Improvements to Reportable Segment Disclosures (Topic 280).
This ASU updates reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that
are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of
a segment’s profit or loss. This ASU also requires disclosure of the title and position of the individual identified as the CODM
and an explanation of how the CODM uses the reported measures of a segment’s profit or loss in assessing segment performance and
deciding how to allocate resources. The ASU is effective for annual periods beginning after December 15, 2023, and interim periods within
fiscal years beginning after December 15, 2024. Adoption of the ASU should be applied retrospectively to all prior periods presented
in the financial statements. Early adoption is also permitted. This ASU will likely result in us including the additional required disclosures
when adopted. There was no material effect on the consolidated financial statements for the year ended December 31,
2025.

In
December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information
about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is
effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial
statements that have not yet been issued or made available for issuance. This ASU will result in the required additional disclosures
being included in our consolidated financial statements, once adopted.