OTC: OZSC

On
December 11, 2020, the Company formed Ozop Energy Systems, Inc. (“OES”), a Nevada corporation and a wholly owned subsidiary
of the Company. OES was formed to be a manufacturer and distributor of renewable energy products.

On
August 19, 2021, the Company formed Ozop Capital Partners, Inc. (“Ozop Capital”), a Delaware corporation and a wholly owned
subsidiary of the Company. Brian Conway was appointed as the sole officer and director of Ozop Capital and has voting control of Ozop
Capital.

On
October 29, 2021, EV Insurance Company, Inc. (“EVCO”) was formed as a captive insurance company in the State of Delaware.
EVCO is a wholly owned subsidiary of Ozop Capital. On January 7, 2022, EVCO filed with New Castle County, Delaware DBA OZOP Plus.

On
February 25, 2022, the Company formed Ozop Engineering and Design, Inc. (“OED”) a Nevada corporation, as a wholly owned subsidiary
of the Company. OED was formed to become a premier engineering and lighting control design firm. OED offers product and design support
for lighting and solar projects with a focus on fast lead times and technical support. OED and our partners are able to offer the resources
needed for lighting, solar and electrical design projects. OED will provide customers systems to coordinate the understanding of electrical
usage with the relationship between lighting design and lighting controls, by developing more efficient ecofriendly designs. We work
with architects, engineers, facility managers, electrical contractors and engineers.

On
May 5, 2023, the Board of Directors of the Company approved to amend the Company’s Articles of Incorporation (the 2023 “Amendment”)
to increase the authorized capital stock of the Company to 7,000,000,000 shares, of which 6,990,000,000 shall be authorized as common
shares and 10,000,000 shall be authorized as preferred shares. The Company filed the 2023 Amendment with the State of Nevada on June
23, 2023.

On
June 4, 2024, the Board of Directors of the Company approved to amend the Company’s Articles of Incorporation (the “2024
Amendment”) to increase the authorized capital stock of the Company to 9,000,000,000 shares, of which 8,990,000,000 shall be authorized
as common shares and 10,000,000 shall be authorized as preferred shares. The Company filed the 2024 Amendment with the State of Nevada
on July 22, 2024.

On
June 11, 2024, the Company formed Automated Room Controls, Inc. (“ARC”) a Nevada corporation, as a wholly owned subsidiary
of the Company. ARC was created to address a significant need in the lighting controls industry. ARC’s personnel has extensive
experience in lighting controls since 2012, bringing together IT specialists and lighting control experts. We believe that easy deployment
and creative applications can transform lighting controls into essential tools for enhancing the utility and ambiance of any space. The
Company’s mission is to deliver cutting-edge technology that simplifies complex control needs, ensuring seamless integration and
exceptional performance.

On
March 4, 2025, the Board of Directors of the Company approved to amend the Company’s Articles of Incorporation (the “March
2025 Amendment”) to increase the authorized capital stock of the Company to 16,000,000,000 shares, of which 15,990,000,000 shall
be authorized as common shares and 10,000,000 shall be authorized as preferred shares. The Company filed the March 2025 Amendment with
the State of Nevada on April 10, 2025.

On
May 21, 2025, the Board of Directors of the Company approved to amend the Company’s Articles of Incorporation (the “May 2025
Amendment”) to increase the authorized capital stock of the Company to 26,000,000,000 shares, of which 25,990,000,000 shall be
authorized as common shares and 10,000,000 shall be authorized as preferred shares. The Company filed the May 2025 Amendment with the
State of Nevada on July 1, 2025.

4

Corporate
Matters

On
July 7, 2020, the Company filed an Amended and Restated Certificate of Designation with the State of Nevada of the Company’s Series
C Preferred Stock. Under the terms of the Amendment to Certificate of Designation of Series C Preferred Stock, 50,000 shares of the Company’s
preferred remain designated as Series C Preferred Stock. The holders of Series C Preferred Stock have no conversion rights and no dividend
rights. For so long as any shares of the Series C Preferred Stock remain issued and outstanding, the Holder thereof, voting separately
as a class, shall have the right to vote on all shareholder matters equal to sixty-seven (67%) percent of the total vote. On July 10,
2020, pursuant to the SPA with PCTI, the Company issued 47,500 shares of Series C preferred Stock to Chis. On July 13, 2021, the Company
purchased 47,500 shares of the Company’s Series C Preferred Stock held by Chis (see below). As of December 31, 2025, and 2024,
there were 2,500 shares, respectively, of Series C Preferred Stock issued and outstanding, all owned by Mr. Conway.

On
July 7, 2020, the Company filed a Certificate of Designation with the State of Nevada of the Company’s Series D Preferred Stock.
Under the terms of the Certificate of Designation of Series D Preferred Stock, 20,000 shares of the Company’s preferred stock have
been designated as Series D Convertible Preferred Stock. The holders of the Series D Convertible Preferred Stock shall not be entitled
to receive dividends. The holders as a group may, at any time convert all of the shares of Series D Convertible Preferred Stock into
a number of fully paid and nonassessable shares of common stock determined by multiplying the number of issued and outstanding shares
of common stock of the Company on the date of conversion, by 3. Except as provided in the Certificate of Designation or as otherwise
required by law, no holder of the Series D Convertible Preferred Stock shall be entitled to vote on any matter submitted to the shareholders
of the Company for their vote, waiver, release or other action. The Series D Convertible Preferred Stock shall not bear any liquidation
rights. On July 10, 2020, pursuant to the SPA with PCTI, the Company issued 18,667 shares of Series D preferred Stock to Chis, and on
August 28, 2020. Pursuant to Mr. Conway’s employment agreement, the Company issued 1,333 shares of Series D Preferred Stock to
Mr. Conway. On July 13, 2021, the Company purchased 18,667 shares of the Company’s Series D Preferred Stock held by Chis (see below).

On
July 13, 2021, the Company entered into a Definitive Agreement (the “Agreement”) with Chis to purchase the 47,500 shares
of the Company’s Series C Preferred Stock held by Chis and the 18,667 shares of the Company’s Series D Preferred Stock held
by Chis for the total purchase price of $11,250,000. In conjunction with the Agreement, Chis resigned from any and all positions held
in the Company’s wholly owned subsidiary, PCTI. Further, Chis agreed that upon her resignation and for a period of five years thereafter
(the “Restriction Period”), she shall not, directly or indirectly, solicit the employment of, assist in the soliciting of
the employment of, or hire any employee or officer of the Company, including those of any of its present or future subsidiaries, or induce
any person who is an employee, officer, agent, consultant or contractor of the Company to terminate such relationship with the Company.
Additionally, Chis agrees that during the Restriction Period, she shall not compete with the Company or PCTI anywhere worldwide or be
employed by any competitor of the Company.

On
July 27, 2021, the Company filed with the Secretary of State of the State of Nevada an Amended and Restated Certificate of Designation
of Series D Preferred Stock (the “Series D Amendment”). Under the terms of the Series D Amendment, 4,570 shares of the Company’s
preferred stock will be designated as Series D Convertible Preferred Stock. The holders of the Series D Convertible Preferred Stock shall
not be entitled to receive dividends. Any holder may, at any time convert any number of shares of Series D Convertible Preferred Stock
held by such holder into a number of fully paid and nonassessable shares of common stock determined by multiplying the number of issued
and outstanding shares of common stock of the Company on the date of conversion, by 1.5 and dividing that number by the number of shares
of Series D Convertible Preferred Stock being converted. Except as provided in the Series D Amendment or as otherwise required by law,
no holder of the Series D Convertible Preferred Stock shall be entitled to vote on any matter submitted to the shareholders of the Company
for their vote, waiver, release or other action. The Series D Convertible Preferred Stock shall not bear any liquidation rights. On July
28, 2021, the Company closed on a Stock and Warrant Purchase Agreement (the “Series D SPA”). Pursuant to the terms of Series
D SPA, an investor in exchange for $13,200,000 purchased one share of Series D Preferred Stock, and a warrant to acquire 3,236 shares
of Series D Preferred Stock. As of December 31, 2025, and 2024, there were 1,334 shares, respectively, of Series D Preferred Stock issued
and outstanding and warrants to purchase 3,236 shares of Series D Preferred Stock are outstanding as of December 31, 2025. Mr. Conway
owns 1,333 shares of Series D Preferred Stock as of December 31, 2025, and 2024.

On
July 7, 2020, the Company filed a Certificate of Designation with the State of Nevada of the Company’s Series E Preferred Stock.
Under the terms of the Certificate of Designation of Series E Preferred Stock, 3,000 shares of the Company’s preferred stock have
been designated as Series E Preferred Stock. The holders of the Series E Convertible Preferred Stock shall not be entitled to receive
dividends. No holder of the Series E Preferred Stock shall be entitled to vote on any matter submitted to the shareholders of the Corporation
for their vote, waiver, release or other action, except as may be otherwise expressly required by law. At any time, the Corporation may
redeem for cash out of funds legally available therefor, any or all of the outstanding Preferred Stock (“Optional Redemption”)
at $1,000 (one thousand dollars) per share. The shares of Series E Preferred Stock have not been registered under the Securities Act
of 1933 or the laws of any state of the United States and may not be transferred without such registration or an exemption from registration.
As of December 31, 2025, and 2024, there were -0- shares, respectively, of Series E Preferred Stock issued and outstanding.

5

On
May 2, 2023, the Company entered into an Equity Financing Agreement (the “Financing Agreement”) and Registration Rights Agreement
(the “Registration Rights Agreement”) with GHS Investments LLC (“GHS”). Under the terms of the Financing Agreement,
GHS has agreed to provide the Company with up to $10,000,000 of funding upon effectiveness of a registration statement on Form S-1. Pursuant
to the effectiveness of the registration statement on July 19, 2023, the Company has the right to deliver puts to GHS and GHS will be
obligated to purchase shares of our common stock based on the investment amount specified in each put notice. The maximum amount that
the Company shall be entitled to put to GHS in each put notice will not exceed two hundred fifty percent (250%) of the average of the
daily trading dollar volume of the Company’s common stock during the ten (10) trading days preceding the put, so long as such amount
does not exceed 4.99% of the outstanding shares of the Company. Pursuant to the Financing Agreement, GHS and its affiliates will not
be permitted to purchase, and the Company may not put shares of the Company’s common stock to GHS that would result in GHS’s
beneficial ownership equaling more than 4.99% of the Company’s outstanding common stock. The price of each put share shall be equal
to eighty percent (80%) of the lowest daily volume weighted average price of the Company’s common stock for the ten (10) consecutive
trading days preceding the date on which the applicable put is delivered to GHS. No put will be made in an amount equaling less than
$10,000 or greater than $750,000. Puts may be delivered by the Company to GHS until the earlier of twenty-four (24) months after the
effectiveness of the registration statement on Form S-1 or the date on which GHS has purchased an aggregate of $10,000,000 worth of put
shares. During the year ended December 31, 2024, the Company sold GHS 29,304 post reverse split (146,517,693 prior to the reverse split)
shares of common stock for proceeds of $172,117 net of offering costs.

On
January 26, 2024, the Company receive a Notice of Effectiveness for the sale of up to 200,000 post reverse split (1,000,000,000 prior
to the reverse split) shares of the Company’s common stock to GHS, pursuant to the May 2, 2023, Financing Agreement and Registration
Rights Agreement. The terms and conditions are similar to the terms and conditions of the July 19, 2023, registration statement. During
the year ended December 31, 2024, the Company sold to GHS 200,000 post reverse split (1,000,000,000 prior to the reverse split) shares
of common stock and received $760,160, net of offering costs.

On
July 30, 2024, the Company receive a Notice of Effectiveness for the sale of up to 400,000 post reverse split (2,000,000,000 prior to
the reverse split) shares of the Company’s common stock to GHS, pursuant to the May 2, 2023, Financing Agreement and Registration
Rights Agreement. The terms and conditions are similar to the terms and conditions of the July 19, 2023, registration statement. During
the year ended December 31, 2025, the Company sold to GHS 272,919 post reverse split (1,364,594,180 prior to the reverse split) shares
of common stock respectively for proceeds of $295,965 net of offering costs. During the year ended December 31, 2024, the Company sold
to GHS 91,598 post reverse split (457,990,649 prior to the reverse split) shares of common stock and received $280,094, net of offering
costs.

On
April 11, 2025, the Company entered into an Equity Financing Agreement (the “2025 Financing Agreement”) and Registration
Rights Agreement (the “2025 Registration Rights Agreement”) with GHS. Under the terms of the Financing Agreement, GHS has
agreed to provide the Company with up to $10,000,000 (the “Commitment Amount”) of funding upon effectiveness of a registration
statement on Form S-1. Pursuant to the effectiveness of the registration statement the Company has the right to deliver puts to GHS and
GHS will be obligated to purchase shares of our common stock based on the investment amount specified in each put notice. The maximum
amount that the Company shall be entitled to put to GHS in each put notice will not exceed three hundred percent (300%) of the average
of the daily trading dollar volume of the Company’s common stock during the ten (10) trading days preceding the put, so long as
such amount does not exceed 4.99% of the outstanding shares of the Company. Pursuant to the 2025 Financing Agreement, GHS and its affiliates
will not be permitted to purchase, and the Company may not put shares of the Company’s common stock to GHS that would result in
GHS’s beneficial ownership equaling more than 4.99% of the Company’s outstanding common stock. The price of each put share
shall be equal to eighty percent (80%) of the lowest daily volume weighted average price of the Company’s common stock for the
ten (10) consecutive trading days preceding the date on which the applicable put iso GHS. No put will be made in an amount equaling less
than $10,000 or greater than $1,000,000. Puts may be delivered by the Company to GHS until the earlier of thirty-six (36) months after
the effectiveness of the registration statement on Form S-1 or the date on which GHS has purchased an aggregate of $10,000,000 worth
of put shares. The Company also agreed to issue to the investor as an equity incentive shares (the “Commitment Shares”) equal
to one quarter of one percent (0.25%) of the Commitment Amount, priced at a fixed price equaling ninety-five (95%) of the VWAP for the
trading day preceding the execution of Agreements. This equates to $25,000, and as of the filing date of this quarterly report the shares
have not been issued. On May 7, 2025, the Company receive a Notice of Effectiveness for the sale of up to 800,000 post reverse split
(4,000,000,000 prior to the reverse split) shares of the Company’s common stock to GHS, pursuant to the April 11, 2025, Financing
Agreement and Registration Rights Agreement. For the year ended December 31, 2025, the Company sold GHS 223,244 post reverse split (1,116,220,813
prior to the reverse split) shares of common stock for proceeds of $96,203, net of offering costs. Subsequent to December 31, 2025, the
Company sold GHS 439,796 post reverse split shares of common stock for proceeds of $47,068 net of offering costs and $5,000 of note payables
paid.

6

Discontinued
Operations

In
accordance with ASC 205-20 Presentation of Financial Statements: Discontinued Operations, a disposal of a component of an entity
or a group of components of an entity is required to be reported as discontinued operations if the disposal represents a strategic shift
that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meet the
criteria in paragraph 205-20-45-10. In the period in which the component meets held-for-sale or discontinued operations criteria the
major current assets, other assets, current liabilities, and noncurrent liabilities shall be reported as components of total assets and
liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations,
less applicable income taxes (benefit), shall be reported as components of net income (loss) separate from the net income (loss) of continuing
operations.

On
September 1, 2022, the BOD of the Company authorized the filing of a Chapter 7 proceeding which meets the definition of a discontinued
operation. Accordingly, the operating results of PCTI are reported as income from discontinued operations in the accompanying consolidated
financial statements for the years ended December 31, 2025, and 2024.

Business
Overview

Ozop
Energy Systems

OES
operates in the renewable, electric vehicle (“EV”), energy storage and energy resiliency sectors. We are engaged in multiple
business lines that include project development as well as equipment distribution.

Equipment
Distributor: In April 2021, the Company signed a five-year lease (beginning June 1, 2021) of approximately 8,100 SF in California,
for office and warehouse space to support the sales and distribution of our west coast operations. On February 22, 2023, with an effective
date of March 1, 2023, the Company entered into a Sublease for a Single Subleasee Agreement (the “Sublease”) with the landlord
and a third party for the office and warehouse in Carlsbad California. Pursuant to the Sublease agreement, the third party will be responsible
for all of the Company’s lease obligations through May 31, 2026, the lease termination date. The Company and the subleasee have
agreed to work together regarding any existing Company inventory in the facility.

Modular
Energy Distribution System: The NeoVolt™ System comprises the design engineering, installation, and operational
methodologies as well as the financial arbitrage of how we produce, capture and distribute electrical energy for the EV markets. Our
NeoVoltTM System offers (1) charging locations that can be installed with reduced delays, restricted areas or load
limits and (2) EV charger electricity that is produced from renewable sources claiming little to no carbon footprint.

The
Company has developed a business plan for NeoVolt™, a scalable battery storage solution that aims to relieve the stress on existing
grid infrastructure by providing distributed energy storage. With the first stage of engineered technical drawings completed, we are
advancing to stage two and preparing to construct the initial prototype or proof of concept (PoC). NeoVolt™ is designed with advanced
features, including automatic adoption of connected devices and dynamic load balancing through a master-slave configuration. These capabilities
enable NeoVolt™ to seamlessly integrate with and manage energy flows across multiple devices. Furthermore, the PoC is contingent
upon recent advancements in EV charging and discharging standardizations, including on-board inverters and bi-directional capabilities,
to ensure compatibility and efficiency in both residential and commercial applications.

7

OZOP
Plus

Ozop
Plus markets vehicle service contracts (VSC’s”) for electric vehicles (EV’s) that offer consumers to be able to purchase
additional months and miles above the manufacturer’s warranty and to also bring added value to EV owners by utilizing our partnerships
and strengths in the energy market to offer unique and innovative services. EVCO has agreements with others whereby the battery premium
associated with any EV VSC will be ceded to EVCO. OZOP Plus markets vehicle service contracts (“VSC’s”) for electric
vehicles (EV’s) that offer consumers to be able to purchase additional months and miles above the manufacturer’s warranty
and to also bring added value to EV owners by utilizing our partnerships and strengths in the energy market to offer unique and innovative
services. Among EV owners’ concerns are the EV battery repair and replacement costs, range anxiety, environmental responsibilities,
roadside assistance, and the accelerated wear on additional components that EV vehicles experience. Management believes that the OZOP
Plus marketed VSC’s will give “peace of mind” to the EV buyer. On October 23, 2024, Ozop Capital Partners, Inc. entered
into an agreement with Empire Auto Protect (“Empire”). Under the agreement, Empire will white label Royal Administration’s
Fully Charged VSC, to be marketed as Empire Plus. OZOP Plus will be ceded the battery premium portion of all of the Empire Plus VSC’s
contracted.

Ozop
Engineering and Design

OED
was formed to become a premier engineering and lighting control design firm. OED offers product and design support for lighting and solar
projects with a focus on fast lead times and technical support. OED and our partners are able to offer the resources needed for lighting,
solar and electrical design projects. OED provides its’ customers systems to coordinate the understanding of electrical usage with
the relationship between lighting design and lighting controls, by developing more efficient ecofriendly designs by working with architects,
engineers, facility managers, electrical contractors and engineers. OED specializes in lighting commissioning services. On September
27, 2024, OED signed an agreement with Leviton Manufacturing Co, Inc., to serve as a field service technician for their advanced lighting
control systems.

Automated
Room Controls (ARC)

ARC
is developing products to be an advanced lighting controls system, intricately engineered to integrate sophisticated wired and wireless
technologies. At its core, it employs a hybrid network topology that facilitates both resilient wired connections and flexible wireless
communications, making it suitable for complex infrastructural environments. The system is equipped with an array of sensors and control
nodes, enabling precise light management and energy usage monitoring. With support for protocols such as DALI and Zigbee, alongside the
capability for seamless integration with IoT platforms, ARC offers a comprehensive solution for intricate lighting networks. This system
is designed not just for control and efficiency, but also for adaptability to diverse architectural and electrical layouts, embodying
a technical solution for advanced, energy-conscious lighting management.

Sales
and marketing

The
Company markets its products through its websites as well as attending industry-specific trade shows. Additionally, OZOP Plus markets
the EV VSC in conjunction with Royal Administration Services, Inc. (“Royal”) through Royal’s agents and the Company
also will begin marketing the product through various third-party websites and portals for additional direct to consumer marketing to
EV owners.

Competition

We
compete with many companies in the various application segments including larger, more established companies with substantial capabilities,
personnel and financial resources. Many of our competitors have a larger presence in global markets.

Employees

As
of the date of this filing, the Company employs 1 full time and 3 part-time employees. Ozop also has contracts with various independent
contractors and consultants to fulfil additional needs, including accounting, investor relations, business development, permitting, and
other corporate functions, and may increase staff further as we expand activities and bring new projects online.

8