What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-03-31 compared with 2025-03-31 · 413 added, 446 removed, 497 unchanged (63% of the section changed)

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Notes to Financial Statements

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

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Going Concern Matter

The accompanying financial statements have

been prepared assuming that the Company will continue as a going concern.

As discussed in Note 2 to the financial statements, the Company

has suffered recurring losses from operations that raises substantial doubt about its ability to continue as a going concern.

plans in regard to these matters are also described in Note 2.

The financial statements do not include any adjustments that might result

from the outcome of this uncertainty.

The accompanying financial statements

have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 2 to the financial statements, the

Company has suffered recurring losses from operations that raises substantial doubt about its ability to continue as a going concern.

Management's plans in regard to these matters are also described in Note 2.

The financial statements do not include any adjustments that

might result from the outcome of this uncertainty.

Basis for Opinion

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rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with

the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we

engaged to perform, an audit of its internal control over financial reporting.

We conducted our audits in accordance

with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether

the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were

we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required to obtain an understanding

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We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

Critical audit matters are matters arising

from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,

subjective, or complex judgments.

We determined that there are no critical audit matters.

/s/ MaloneBailey, LLP

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Total Stockholders' Equity (Deficit)

( 4,432,115 )

Total Liabilities and Stockholders' Equity (Deficit)

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Other income (expenses):

Other expense

Interest income

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Loss per share - basic

$ ( 12,509.11 )

Loss per share - diluted

$ ( 12,509.11 )

Weighted average shares outstanding - basic

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Stockholders'

Equity (Deficit)

Balance December 31, 2023

$ ( 69,566,903 )

Common stock issued for cash, net

Exercise of warrants

$ ( 4,432,115 )

Common stock issued for cash and warrants, net

Exercise of warrants, net

Stock-based compensation

Shares issued for license agreement

Stock issued for stock split rounding

( 14,857,801 )

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( 84,424,704 )

( 4,432,115 )

Common stock issued for cash and warrants, net

Exercise of warrants, net

Stock repurchase during stock split rounding

Stock-based compensation

Shares issued for license agreement

Stock issued for stock split rounding

( 15,850,564 )

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$ 104,797,191

$ ( 100,275,268 )

See accompanying notes to the financial statements.

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Common stock issued for license agreement

Loss on disposal of fixed assets

Loss (gain) on disposal of fixed assets

Changes in operating assets and liabilities:

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Payments on notes payable

Stock repurchased during stock split rounding

Proceeds from subscription receivable

Proceeds from exercise of warrants

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Net change in cash and cash equivalents

( 9,506,686 )

Cash and cash equivalents, at beginning of period

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CNS Pharmaceuticals, Inc.

(“we”, “our”, the

“Company”) is a clinical pharmaceutical company organized as a Nevada corporation on July 27, 2017 to focus on the development

of anti-cancer drug candidates.

(“we”, “our”,

the “Company”) is a biotechnology company organized as a Nevada corporation in July 2017.

We are focused on building a high-value

pipeline for neurology and oncology indications that have the potential to be best-in-class.

We are leveraging our executive team’s

experiences in these therapeutic areas to execute our new corporate strategy, which also includes pivoting from a singular focus on glioblastoma

multiforme and exploring out-licensing opportunities for our legacy assets TPI 287 and Berubicin for which we have intellectual property

rights under license agreement with Cortice and own pursuant to a collaboration and asset purchase agreement with Reata.

On April 30, 2024, the stockholders of the Company approved an amendment

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financial statements and footnotes.

On July 22, 2025, the Company effected a reverse stock split on a 1-for-12

basis without any change in the par value per share, which remained at $0.001.

The reverse stock split has been retroactively adjusted

throughout these financial statements and footnotes.

The number of authorized shares of common stock was also proportionately reduced

from 300,000,000 to 25,000,000 , while the number of authorized shares of preferred stock was proportionately reduced from 5,000,000 to

On November 20, 2025, following approval by shareholders, the Company

filed a Certificate of Amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada

to increase the number of the Company’s authorized shares of common stock from 25,000,000 shares to 300,000,000

shares and to increase the total number of authorized shares of preferred stock from 416,667 shares to 5,000,000 shares.

Note 2 – Summary of Significant Accounting Policies

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Actual results could differ from those estimates.

Liquidity and Going Concern - These financial statements have

been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in

the normal course of business.

The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain

equity financings to continue operations.

The Company has a history of and expects to continue to report negative cash flows from operations

and a net loss.

Management believes that the cash on hand, combined with aggressive working

capital management, will allow us to continue operating Within one year after the date that the financial statements are issued.

These factors raise substantial doubt regarding the Company’s ability to

and Going Concern - These financial statements have been prepared on a going concern basis, which assumes the Company

will continue to realize its assets and discharge its liabilities in the normal course of business.

The continuation of the Company

as a going concern is dependent upon the ability of the Company to obtain equity financings to continue operations.

The Company has

a history of and expects to continue to report negative cash flows from operations and a net loss.

For the year ended December 31,

2025, we recorded a net loss of approximately $ 15.9 million and used cash in operations for approximately $ 13.8 million .

factors raise substantial doubt regarding the Company’s ability to continue as a going concern within one year after the date

that the financial statements are issued.

These financial statements do not include any adjustments to the recoverability and

classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to

continue as a going concern.

These financial statements do not include any adjustments to the recoverability and classification of recorded

asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Company may seek additional funding through a combination of equity offerings, debt financings, government or other third-party funding,

commercialization, marketing and distribution arrangements, other collaborations, strategic alliances and licensing arrangements and delay

planned cash outlays or a combination thereof.

Management cannot be certain that such events or a combination thereof can be achieved.

The Company may seek additional funding through a combination of equity offerings, debt financings,

government or other third-party funding, commercialization, marketing and distribution arrangements, other collaborations, strategic

alliances and licensing arrangements and delay planned cash outlays or a combination thereof.

Management cannot be certain that such

events or a combination thereof can be achieved.

Cash and Cash Equivalents - The Company considers all highly

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Fair Value of Financial Instruments - The carrying value of

short-term instruments, including cash and cash equivalents, accounts payable and accrued expenses, and short-term notes approximate

fair value due to the relatively short period to maturity for these instruments.

short-term instruments, including cash and cash equivalents, accounts payable and accrued expenses, and short-term notes approximate fair

value due to the relatively short period to maturity for these instruments.

Fair value is defined as the exchange price that would be received

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settlement with the tax authorities in the tax jurisdictions in which it operates.

Stock-based Compensation - Employee and non-employee share-based

Stock-based Compensation - Under ASC 718, employee and non-employee share-based

compensation is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service

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our performance against predefined share price targets and the achievement of Positive Interim, Clinical Data as defined by the Board.

Warrants - The Company evaluates all freestanding and

embedded warrants to determine whether they meet the criteria for equity classification under ASC 815-40, Derivatives and Hedging—Contracts

in Entity’s Own Equity , or if they must be classified as liabilities under ASC 480 or ASC 815-10.

The Company evaluated

the warrants and concluded they are indexed to the Company's common stock and meet the equity classification criteria under ASC 815-40,

as they are settleable in shares, and the Company has sufficient shares authorized.

The warrants were recorded at fair value upon issuance

within stockholders' equity

Loss Per Common Share - Basic loss per common share is computed

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units of 5 and options for 70 common shares, respectively.

Research and Development Costs - Research and

development costs are expensed as incurred.

The Company recognized the benefit of refundable research and development tax credits as

a reduction of research and development expenses when there is reasonable assurance that the amount claimed will be recovered.

The Company manages its operations as a

single segment for the purpose of assessing performance and making operating decisions.

The Company’s Chief Operating Decision

Maker (“CODM”) is its Chief Executive Officer.

The CODM allocates resources and evaluates the performance of the Company

using information about combined net income from operations.

All significant operating decisions are based upon an analysis of the

Company as one operating segment, which is the same as its reporting segment.

See statement of operations for information

about combined net income from operations.

Research and Development Costs - Research and development costs

are expensed as incurred.

The Company recognized the benefit of refundable research and development tax credits as a reduction of research

and development expenses when there is reasonable assurance that the amount claimed will be recovered.

Segments Reporting

The Company manages its operations as a single segment for the purpose

of assessing performance and making operating decisions.

The Company’s Chief Operating Decision Maker (“CODM”) is its

Chief Executive Officer.

The CODM allocates resources and evaluates the performance of the Company using information about combined net

income from operations.

All significant operating decisions are based upon an analysis of the Company as one operating segment, which

is the same as its reporting segment.

See statement of operations for information about combined net income from operations.

Recent Accounting Pronouncements

In November 2023, the FASB issued ASU No.

“Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosure.” The ASU updates reportable segment disclosure

requirements, primarily through requiring enhanced disclosures about significant segment expenses and information used to assess segment

The amendments do not change how segments are determined, aggregated, or how thresholds are applied to determine reportable

In December 2023, the FASB issued Accounting Standards Update (“ASU”)

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”).

ASU 2023-09 requires

enhanced disclosures surrounding income taxes, particularly related to rate reconciliation and income taxes paid information.

In particular,

on an annual basis, companies will be required to disclose specific categories in the rate reconciliation and provide additional information

for reconciling items that meet a quantitative threshold.

Companies will also be required to disclose, on an annual basis, the amount

of income taxes paid, disaggregated by federal, state, and foreign taxes, and also disaggregated by individual jurisdictions above a quantitative

The standard is effective for the Company for annual periods beginning January 1, 2025 on a prospective basis, with retrospective

application permitted for all prior periods presented.

We adopted ASU No.

2023-07 during the year ended December 31, 2024.

In November 2024, the FASB issued ASU No.

2024-03, “Income Statement—Reporting

Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses” to

improve disclosures about the nature of expenses in commonly presented financial statement captions.

ASU 2024-03 is effective for all

public business entities for annual reporting periods beginning after December 15, 2026, on either a prospective or retrospective basis.

Early adoption permitted.

Management is currently evaluating the impact of this accounting standard update on its consolidated financial

statements and related disclosures.

2023-09 during the year ended December 31, 2025, with no material

impact to the Company’s financial statements or results of operations.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued Accounting Standards Update No.

Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”).

ASU 2024-03 requires specified information about certain costs and expenses be disclosed in the notes to the financial statements, including

the expense caption on the face of the income statement in which they are disclosed, in addition to a qualitative description of remaining

amounts not separately disaggregated.

Entities will also be required to disclose their definition of “selling expenses” and

the total amount in each annual period.

The standard is effective for the Company for annual periods beginning January 1, 2027 and for

interim periods beginning January 1, 2028, with updates applied either prospectively or retrospectively.

Early adoption is permitted.

The Company is currently evaluating the impact of this guidance on its disclosures.

Credit Losses

In July 2025, the FASB

issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract

Assets, which provides updates related to CECL guidance for certain short-term receivables.

The ASU is effective for fiscal years beginning

after December 15, 2025.

The Company is currently evaluating the impact of this guidance on its disclosures.

Note 3 – Note Payable

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On November 28, 2024, the Company entered into a short-term note payable

for an aggregate of $ 329,571 ,

bearing interest at 9.74 %

per year to finance certain insurance policies.

Principal and interest payments related to the note will be repaid over an 11-month period

with the final payment due on October

As of December 31, 2024 and 2023, the Company’s note payable balance was $ 0

and $ 300,806 ,

respectively.

for an aggregate of $ 326,072 , bearing interest at 9.24 % per year to finance certain insurance policies.

Principal and interest payments

related to the note will be repaid over an 11-month period with the final payment due on October 8, 2025 .

As of December 31, 2025 and

2024, the Company’s note payable balance was $ 0 and $ 326,072 , respectively.

Note 4 – Equity

The Company has authorized 75,000,000 shares of common stock having

a par value of $ 0.001 per share.

In addition, the Company authorized 5,000,000 shares of preferred stock to be issued having a par value

The Company has authorized 300,000,000

shares of common stock having a par value of $ 0.001

In addition, the Company authorized 5,000,000

shares of preferred stock to be issued having a par value of $ 0.001 .

The specific rights of the preferred stock shall be determined by the board of directors.

On May 2, 2024, the Company filed

a Certificate of Amendment to its Amended and Restated Articles of Incorporation with the Secretary of State of the State of Nevada to

increase the number of the Company’s authorized shares of common stock from 75,000,000 shares to 300,000,000 shares.

On April 30, 2024, the stockholders of the Company approved an amendment

to the Company’s amended and restated articles of incorporation (the “Amendment”) to effect the reverse stock split

at a ratio in the range of 1-for-2 to 1-for-50, with such ratio to be determined in the discretion of the Company’s board of directors

and with such reverse stock split to be effected at such time and date, if at all, as determined by the Company’s board of directors

in its sole discretion prior to the one-year anniversary of the annual meeting.

Pursuant to such authority granted by the Company’s stockholders,

the Company’s board of directors approved a one-for-fifty (1:50) reverse stock split of the Company’s common stock and the

filing of the Amendment to effectuate the reverse split.

The reverse stock split became effective on June 4, 2024 on a 1-for-50 basis

without any change in the par value per share, which remained at $0.001.

The reverse stock split has been retroactively adjusted throughout

these financial statements and footnotes.

On April 30, 2024, the Company held its scheduled 2024 Annual Meeting

of Stockholders at which the Company’s stockholders approved amendments to the Company's 2020 Equity Plan (the “2020 Plan”)

including an increase in the number of shares of common stock, par value $0.001 per share, authorized for issuance under the 2020 Plan

by 1,400 shares.

As amended, the number of shares of the common stock that may be issued under the 2020 Plan is 1,739 shares (this includes

the 1,400 share increase).

On November 26, 2024, the stockholders of the Company approved an amendment

to the Company’s amended and restated articles of incorporation (the “Amendment”) to effect the reverse stock split

at a ratio in the range of 1-for-2 to 1-for-50, with such ratio to be determined in the discretion of the Company’s board of directors

and with such reverse stock split to be effected at such time and date, if at all, as determined by the Company’s board of directors

in its sole discretion prior to the one-year anniversary of the annual meeting.

Pursuant to such authority granted by the Company’s stockholders,

the Company’s board of directors approved a one-for-fifty (1:50) reverse stock split of the Company’s common stock and the

filing of the Amendment to effectuate the reverse split.

The reverse stock split became effective on February 21, 2025 on a 1-for-50 basis

without any change in the par value per share, which remained at $0.001.

The reverse stock split has been retroactively adjusted throughout

these financial statements and footnotes.

On July 26, 2024, the Company entered into a Sales Agreement (the “AGP

ATM Sales Agreement”) with A.G.P./Alliance Global Partners (“AGP”).

Pursuant to the terms of the AGP ATM Sales Agreement,

the Company originally was permitted to sell from time to time through AGP, as sales agent or principal, shares of the Company’s

common stock, par value $0.001 per share with initial aggregate sales price of up to $5.2 million.

On July 30, 2024, the Company increased

the aggregate sales price of common shares that may be sold under the AGP ATM Sales Agreement to $25.0 million (not including the original

$5.2 million).

On March 20, 2025, the Company increased the aggregate sales price of common shares that may be sold under the AGP ATM

Sales Agreement to $43.5 million (which amount includes $6.4 million remaining from the $30.2 million set forth above).

On September 19,

2025, the Company decreased the sales price of common shares that may be sold under the AGP ATM Sales Agreement to $1.76 million, which

amount does not include any shares of common stock sold prior to such date.

During the year ended December 31, 2025, the Company sold

185,521 shares of common stock pursuant to the AGP ATM Sales Agreement for net proceeds of approximately $ 9.5 million.

As of December

31, 2025, the Company has sold 268,169 shares of common stock pursuant to the AGP ATM Sales Agreement for net proceeds of approximately

$ 23.2 million.

On May 13, 2025, the Company entered into a placement agency agreement

(the “Placement Agency Agreement”) with A.G.P./Alliance Global Partners (the “Placement Agent”) for the public

offering by the Company of (i) 27,084 shares of the Company’s common stock, (ii) pre-funded warrants to purchase 302,295 shares

of common stock (the “Pre-Funded Warrants”);

and (iii) Series F Warrants to purchase up to an aggregate of 329,381 shares

of common stock (the “Common Warrants”).

The Common Warrants and Pre-Funded Warrants are collectively referred to herein as

the (“Warrants”).

The combined purchase price of one share of Common Stock and one accompanying Common Warrant was $15.18

and the combined purchase price of one Pre-Funded Warrant and one accompanying Common Warrant was $15.17.

Subject to certain ownership limitations, the Warrants are exercisable

immediately upon issuance.

Each Pre-Funded Warrant is exercisable into one share of Common Stock at a price per share of $0.001 and expire

once such Pre-Funded Warrants are fully exercised.

The Common Warrants are exercisable into one share of Common Stock at a price per share

of $13.68 and expire five years from Initial Exercise Date.

The gross proceeds to the Company from the offering were approximately $ 5

million, before deducting the Placement Agent’s fees and other offering expenses.

The closing of this offering occurred on May 14,

On January 29, 2024, the Company entered into a placement agency agreement

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in lieu thereof) and accompanying June 14 Common Warrant was $2,250.00.

The closing of this offering and private placement occurred on June

The closing of this offering and private placement occurred on

June 17, 2024.

Subject to certain ownership limitations, each of the June 14 Common

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June 26 Common Warrant was $1,470.00.

The closing of the offering and private placement occurred on June 27, 2024 (the “Closing Date”).

The closing of the offering and private placement occurred on June 27, 2024 (the “Closing

Subject to certain ownership limitations, each of the June 26 Common

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Warrants is immediately exercisable, has an exercise price of $756.00 per share, and expire five years from the date of issuance.

proceeds to the Company from the offering were approximately $ 1.98 million , before deducting the financial advisor fees and other estimated

offering expenses payable by the Company, and excluding the proceeds, if any, from the exercise of the Common Warrants.

After payment

of commissions and expenses, the proceeds received by the Company was $ 1,787,000 .

On July 26, 2024, the Company entered into a Sales Agreement (the “AGP

ATM Sales Agreement”) with A.G.P./Alliance Global Partners (“AGP”).

Pursuant to the terms of the AGP ATM Sales Agreement,

the Company originally was permitted to sell from time to time through AGP, as sales agent or principal, shares of the Company’s

common stock, par value $0.001 per share with initial aggregate sales price of up to $5.2 million.

On July 30, 2024, the Company increased

the aggregate sales price of common shares that may be sold under the AGP ATM Sales Agreement to $25.0 million (not including the original

$5.2 million).

On March 20, 2025, the Company increased the aggregate sales price of common shares that may be sold under the AGP ATM

Sales Agreement to $43.5 million (including $6.4 million remaining from the previous increase).

As of December 31, 2024, the Company has

sold 991,773 Shares pursuant to the AGP ATM Sales Agreement for net proceeds of approximately $ 13.7 million .

$ 882,539 of the net proceeds

was deposited on January 10, 2025.

As of December 31, 2024, the Company recorded a subscription receivable for $ 882,539 .

gross proceeds to the Company from the offering were approximately $ 1.98 million, before deducting the financial advisor fees and other

estimated offering expenses payable by the Company, and excluding the proceeds, if any, from the exercise of the Common Warrants.

payment of commissions and expenses, the proceeds received by the Company was $ 1,787,000 .

Pursuant to the terms of the AGP ATM Sales Agreement entered into on

July 26, 2024, during the year ended December 31, 2024, the Company has sold 82,648 Shares pursuant to the AGP ATM Sales Agreement for

net proceeds of approximately $ 13.7 million.

$ 882,539 of the net proceeds was deposited on January 10, 2025.

As of December 31, 2024,

the Company recorded a subscription receivable for $ 882,539 .

On October 23, 2024, the Company entered into securities purchase agreements

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Pursuant to the Cortice Agreements, the Company agreed to issue Cortice

11,468 shares of the Company’s common stock upon the closing of the transaction, which occurred on July 29, 2024, and 867 shares

of Company common stock upon the receipt of shareholder approval of such issuance as required by the rules of the Nasdaq Stock Market.

The Company also agreed to make milestone payments to Cortice in either cash or shares of Company common stock (at Cortice’s option)

(i) meeting the primary endpoint a pivotal trial for a licensed product – either $15.0 million or 8,223 shares of Company

956 shares of the Company’s common stock upon the closing of the transaction, which occurred on July 29, 2024, and 73 shares of

Company common stock upon the receipt of shareholder approval of such issuance as required by the rules of the Nasdaq Stock Market.

Company also agreed to make milestone payments to Cortice in either cash or shares of Company common stock (at Cortice’s option)

(i) meeting the primary endpoint a pivotal trial for a licensed product – either $15.0 million or 686 shares of Company common

(ii) FDA acceptance of an New Drug Application for a licensed product – either $30.0 million or 1,371 shares of Company common

(iii) the first commercial sale in the United States of a licensed product – either $45.0 million or 2,056 shares of Company

common stock;

(ii) FDA acceptance of an New Drug Application for a licensed product – either $30.0 million or 16,446 shares of Company

and (iv) the first commercial sale in Japan of a licensed product – either $10.0 million or 343 shares of Company

common stock.

(iii) the first commercial sale in the United States of a licensed product – either $45.0 million or 24,668 shares

of Company common stock;

and (iv) the first commercial sale in Japan of a licensed product – either $10.0 million or 4,112 shares

of Company common stock.

The Company’s obligation to pay the above milestones in Company common stock is subject to the receipt

of shareholder approval as required by the rules of the Nasdaq Stock Market.

The Company also agreed to pay Cortice royalties on sales

of licensed products of between 3.0%-7.5%.

Finally, to the extent Cortice is required to pay any milestone payments to the original holder

of the intellectual property rights licensed, the Company has agreed to make such payments to Cortice.

As of December 31, 2024, there

were no accruals related to the milestone payments and the Company issued 11,468 Shares with a fair value of $ 596,303 pursuant to the

Cortice Agreement.

Pursuant to the terms of the Capital on Demand™

Sales Agreement with JonesTrading Institutional Services LLC and Brookline Capital Markets, a division of Arcadia Securities, LLC (collectively,

the “Agent”), the Company may sell from time to time, through the Agent, shares of the Company’s common stock with an

aggregate sales price of up to $20.0 million.

During the year ended December 31, 2023, the Company sold 342 shares of common stock to

the Agent for net proceeds of $ 2,317,599 .

During the year ended December 31, 2023, the Company issued 1,497 shares

of common stock from the exercise of warrants.

The Company’s obligation to pay the above milestones in Company common stock is subject to the receipt of shareholder

approval as required by the rules of the Nasdaq Stock Market.

The Company also agreed to pay Cortice royalties on sales of licensed products

of between 3.0%-7.5%.

Finally, to the extent Cortice is required to pay any milestone payments to the original holder of the intellectual

property rights licensed, the Company has agreed to make such payments to Cortice.

As of December 31, 2024 and 2025, there were no accruals

related to the milestone payments and the Company issued 956 Shares with a fair value of $ 596,303 pursuant to the Cortice Agreement.

Stock Options

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The 2017 Plan allows for the Board of Directors to grant various forms of incentive

awards for up to 27 shares of common stock.

awards for up to three shares of common stock.

In 2020, the Board of Directors of the Company approved the CNS Pharmaceuticals,

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The 2020 Plan allows for the Board of Directors to grant various forms of incentive

awards for up to 40 shares of common stock.

awards for up to four shares of common stock.

The 2020 Plan was amended effective as of August 9, 2023, which was approved by the Company’s

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The amendment increased the 2020 Plan by 25 shares of common

On November 17, 2025, the Company held its scheduled 2025 Annual Meeting

of Stockholders at which the Company’s stockholders approved amendments to the Company's 2020 Equity Plan including an increase

in the number of shares of common stock, par value $ 0.001 per share, authorized for issuance under the 2020 Plan by 114,916 shares.

amended, the number of shares of the common stock that may be issued under the 2020 Plan is 115,061 shares (this includes the 114,916

share increase).

On March 11, 2025, the Board of Directors approved grants of 21,965

options to officers and employees.

The options have a ten-year term at an exercise price of $ 30.00 .

The options were approved by the Company’s

stockholders at the Company’s annual meeting held on November 17, 2025.

The options vest as follows:

(i) 50% on the six month anniversary

of the issuance date;

(ii) 25% on the 12-month anniversary of the issuance date;

and (iii) 25% on the 18-month anniversary of the issuance

The total fair value of these option grants at issuance was $ 123,614 .

On November 17, 2025, the Company held its scheduled 2025 Annual Meeting

of Stockholders at which the Company’s stockholders approved grants of 7,585 options to board members.

The options have a ten-year

term at an exercise price of $ 12.12 .

The options vest in four quarterly installments over a one-year period commencing on the stockholder

approval date.

The total fair value of these option grants at issuance was $ 44,786 .

On January 19, 2024, the Board of Directors of the Company approved

the issuance of 5 options to Ms.

the issuance of 1 option to Ms.

Mahery as compensation for her appointment to our Board of Directors.

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The options have a ten-year term at an exercise price of $ 7,758.00 .

Of the 108 options issued,

35 options vest on the first anniversary or at the time of the 2025 shareholder meeting, whichever occurs first and 73 options vest in

36 equal monthly installments over 3 years.

The total fair value of these option grants at issuance was $ 58,335 .

On March 29, 2023, the Board of Directors approved, based upon the

recommendation of the Compensation Committee, cash bonuses totaling $ 550,750 to the officers of the Company.

In addition, the officers

and an employee were awarded a total of 12 options with a ten-year term at an exercise price of $ 2,490 .

Of the options issued, 50% vest

over 2 years and 50% vest upon the Company’s common stock price exceeding various closing prices ranging from $6.00 - $24.00 per

The total fair value of these option grants at issuance was $ 25,820 .

On May 3, 2023, the Board of Directors of the Company appointed Bettina

Cockroft, M.D., M.B.A as an independent member of the Company’s Board of Directors.

Cockroft was granted a ten-year option

to purchase 1 share of Company common stock at an exercise price of $ 4,175 vesting in 36 equal monthly installments succeeding the issuance

The total fair value of these option grants at issuance was $ 3,514 .

On August 4, 2023, the Board of Directors approved the issuance of

3 options to Dr.

The options have a ten-year term at an exercise price of $ 5,675 and vest in 36 equal monthly installments succeeding

the issuance date .

The total fair value of these option grants at issuance was $ 12,771 .

On August 27, 2023, the Board of Directors approved the issuance of

79 options to the board of directors.

The options have a ten-year term at an exercise price of $ 4,750 and vest on the first anniversary

date of issuance .

Of the 13 options

issued, five options vest on the first anniversary or at the time of the 2025 shareholder meeting, whichever occurs first and 8 options

vest in 36 equal monthly installments over 3 years.

The total fair value of these option grants at issuance was $ 58,335 .

During the years ended December 31, 2024 and 2023, the Company recognized

$ 684,181 and $ 949,982 of stock-based compensation, respectively, related to outstanding stock options.

At December 31, 2024, the Company

had $ 94,968 of unrecognized expenses related to options.

The following table summarizes the stock option activity for the years

6 unchanged sentences

Exercisable, December 31, 2025

The aggregate fair value of the options measured during the years

ended December 31, 2024 and 2023 were calculated using the Black-Scholes option pricing model based on the following assumptions:

The aggregate fair value of the options measured during the years ended

December 31, 2025 and 2024 were calculated using the Black-Scholes option pricing model based on the following assumptions:

Schedule of black-scholes option assumptions

2 unchanged sentences

Fair value of common stock on measurement date

$632.50 to $646.50 per share

$6.70 per share

$7,590.00 to $7,758.00 per share

1 unchanged sentence

3.80 % to 4.39 %

3.38 % to 4.37 %

Volatility (2)

11 unchanged sentences

there were no awards remaining to be issued under the 2017 Plan and 85,429 awards remaining to be issued under the 2020 Plan.

As of December 31, 2023, the outstanding stock options have a weighted

average remaining term of 8.54 years and the aggregate intrinsic value of options vested and outstanding was $ 8,217 .

During the years ended December 31, 2025 and 2024, the Company recognized

$ 133,142 and $ 684,181 of stock-based compensation, related to outstanding options, respectively.

At December 31, 2025, the Company had

$ 86,875 of unrecognized expenses related to outstanding options.

Stock Warrants

1 unchanged sentence

ended December 31, 2025 and 2024:

Schedule of stock warrant

Weighted-Average Exercise Price

2 unchanged sentences

Outstanding, December 31, 2025

On October 16, 2023, the Company entered into a warrant exercise inducement

offer letter (the “Inducement Letter”) with a holder of certain existing warrants (“Holder”) to receive new warrants

to purchase up to a number of shares of common stock equal to 200% (the “Inducement Warrants”) of the number of warrant shares

issued pursuant to the exercise of such certain existing warrants to purchase shares of common stock (the “Existing Warrants”)

pursuant to which the Holder agreed to exercise for cash their Existing Warrants to purchase up to 751 shares of the Company’s common

stock, at a Reduced Exercise Price (as defined below), in exchange for the Company’s agreement to issue the Inducement Warrants

to purchase up to 1,502 shares of the Company’s common stock (the “Inducement Warrant Shares”).

The Existing Warrants

(i) warrants, originally issued on December 22, 2020 and amended on December 5, 2022;

(ii) warrants, originally issued on

January 10, 2022 and amended on December 5, 2022;

and (iii) warrants issued on December 5, 2022.

Pursuant to the Inducement Letter, the

exercise price for such Existing Warrants was reduced to $3,200 per share (the “Reduced Exercise Price”).

In connection with

the warrant inducement, the Company estimated the fair value of the warrants based on the Black-Scholes option pricing model and recorded

a deemed dividend to additional paid in capital of $ 5,571,694 .

The aggregate fair value of the warrants measured during the year ended

December 31, 2023 were calculated using the Black-Scholes option pricing model based on the following assumptions:

Schedule of black-scholes option assumptions

December 31, 2023

Fair value of common stock on measurement date

$4,000 per share

Risk free interest rate (1)

Volatility (2)

Dividend yield (3)

Expected term (in years)

The risk-free interest rate was determined by management using the market yield on U.S.

Treasury securities with comparable terms as of the measurement date.

The trading volatility was determined by calculating the volatility of the Company.

The Company does not expect to pay a dividend in the foreseeable future.

During the year ended December 31, 2025, the Company received $ 3,627

in net cash proceeds from the exercise of 4,448 warrants issued at an exercise price of $2.5, 14 warrants issued at an exercise price

of $750 and 279,944 warrants issued at an exercise price of $0.05.

in net cash proceeds from the exercise of 302,295 warrants issued at an exercise price of $0.01.

As of December 31, 2025, the remaining weighted average term for the

1 unchanged sentence

During the year ended December 31, 2024, the Company received $ 21,325

in net cash proceeds from the exercise of 753 warrants issued at an exercise price of $3,200, 96 warrants issued at an exercise price

of $7,575 and 650 warrants previously issued at an exercise price of $2.5.

As of December 31, 2023 the outstanding and exercisable warrants have

a weighted average remaining term of 4.64 years and an intrinsic value of $ 15,245 .

in net cash proceeds from the exercise of 371 warrants issued at an exercise price of $30, 2 warrants issued at an exercise price of $9,000

and 23,329 warrants issued at an exercise price of $0.60.

Restricted Stock Units

1 unchanged sentence

to officers, employees, and board of directors.

Of the 108 RSUs issued, 35 RSUs vest on the first anniversary or at the time of the 2025

shareholder meeting, whichever occurs first and 73 RSUs vest in 8 equal quarterly installments over 2 years.

Of the 9 RSUs issued, three RSUs vest on the first anniversary or at the time of the 2025

shareholder meeting, whichever occurs first and six RSUs vest in 8 equal quarterly installments over 2 years.

The Company valued the RSUs

14 unchanged sentences

$ 0 and $ 100,362 related to outstanding stock PUs, respectively.

At December 31, 2024, the Company had $ 0 of unrecognized expenses

related to PUs.

At December 31, 2025, the Company had $ 0 of unrecognized expenses related

The following table summarizes the PUs activity

12 unchanged sentences

On September 1, 2020, the Company entered into an amendment to the employment agreement

The amendment extends the term of employment under the Employment Agreement, which was originally for a three-year period,

for additional twelve-month periods, unless and until either the Company or Mr.

Climaco provides written notice to the other party not

less than sixty days before such anniversary date that such party is electing not to extend the term.

If the Company provides notice of

its election not to extend the term, Mr.

Climaco may terminate his employment at any time prior to the expiration of the term by giving

written notice to the Company at least thirty days prior to the effective date of termination, and upon the earlier of such effective

date of termination or the expiration of the term, Mr.

Climaco shall be entitled to receive the same severance benefits as are provided

upon a termination of employment by the Company without cause.

Pursuant to the Amendment, the severance benefits shall be twelve months

Climaco’s base salary.

Such severance payment shall be made in a single lump sum sixty days following the termination, provided

Climaco has executed and delivered to the Company and has not revoked a general release of the Company.

Pursuant to the employment

agreement, the compensation committee of the board of directors reviews the base salary payable to Mr.

Climaco annually during the term

of the agreement.

On March 6, 2025, the compensation committee of the board of directors set Mr.

Climaco’s annual base salary to

On June 28, 2019, we entered into employment letters with Drs.

and Picker pursuant to which Dr.

Silberman agreed to commit 50% of her time to our matters;

Picker agreed to commit 25% of his

time to our matters.

On March 6, 2025, the compensation committee of the board of directors set Drs.

Silberman and Picker annual base

salaries to $ 247,000 and $ 120,000 , respectively.

The amendment extended the term of employment under the employment agreement, which was originally for a three-year

period, for additional twelve-month periods, unless and until either the Company or Mr.

Climaco provides written notice to the other party

not less than sixty days before such anniversary date that such party is electing not to extend the term.

On December 16, 2025, John Climaco resigned from his positions as chief

executive officer of the Company and as a member of the Company’s Board of Directors.

The Company and Mr.

Climaco entered into a

Separation and Severance Agreement dated as of December 16, 2025 (the “Separation Agreement”), which memorializes the terms

of his resignation and separation from service with the Company.

Pursuant to the Separation Agreement, subject to Mr.

timely execution, non-revocation, and compliance with the agreement’s terms, the Company will provide severance benefits, including

(i) severance equal to twelve months of Mr.

Climaco’s current annualized base salary, paid in twelve equal monthly installments,

and payment of his base salary through December 31, 2025;

(ii) payment of Mr.

Climaco’s 2025 cash bonus in the total amount of $ 319,000 ,

paid in twelve equal monthly installments;

and (iii) payment by the Company of the employer portion of premiums for Mr.

continued group medical coverage under COBRA for twelve months following the Separation Date.

On December 16, 2025, the Company entered into an employment agreement

Rami Levin pursuant to which Mr.

Levin agreed to serve as Chief Executive Officer and President of the Company commencing on

Pursuant to the employment agreement, the compensation committee of the board of directors reviews the base salary payable

Levin annually during the term of the agreement.

Commencing on January 1, 2026, the compensation committee of the board of directors

Levin’s 2026 annual base salary to $ 580,000 .

For each full fiscal year during the term, the Executive will be entitled to

receive an annual bonus, within ninety days of the completion of such year.

On January 1, 2026, the Executive was awarded a grant of restricted

stock units (the “RSU Grant”) equal to 19,000 shares of the Company’s common stock.

The RSU Grant shall vest as follows:

(i) 25% on the six-month anniversary of the Effective Date;

(ii) 25% on the twelve-month anniversary of the Effective Date;

the remaining 50% in twelve (12) quarterly installments, provided Executive remains continuously employed by Company through each such

vesting date.

If Executive’s employment is terminated, by the Company without cause or by Executive for Good Reason, Executive shall

be entitled to receive:

(i) Executive’s target annual bonus for the period of time between the end of the last fiscal year and the

termination date;

(ii) accelerated vesting of all unvested equity previously granted to Executive;

and (ii) a severance payment equal

to twelve months of Executive’s Base Salary in effect at the time of termination plus Executive’s target annual bonus.

In March 2025, the Board of Directors approved, based upon the recommendation

of the Compensation Committee, cash bonuses totaling $ 240,608 to the officers of the Company payable upon completion of a subsequent round

of financing and a determination by the Board that such financing is sufficient for the Company's needs after payment of such bonus.

On March 6, 2025, the Board of Directors approved, based upon the recommendation

of the Compensation Committee, cash bonuses totaling $ 631,243 to the officers of the Company.

Scientific Advisory Board

The Scientific Advisory board is consisted of one member, Dr.

Hsu receives annual cash compensation of $68,600.

As of December 31, 2024 and 2023, the Company has accrued $ 177,309 and $ 168,734 ,

respectively, for Mr.

On July 15, 2021, our Board approved the following compensation

policy for the Scientific Advisory Board members, which consisted at the time of Dr.

Waldemar Priebe, our founder, and Dr.

Under this compensation policy, each scientific advisory board member was to receive annual cash compensation of $68,600.

August 25, 2022, Dr.

Waldemar Priebe was no longer a member of the Scientific Advisory Board.

On March 14, 2024, the Board of

Directors terminated the cash compensation program for the Scientific Advisory Board.

As of March 14, 2024, Dr.

Hsu was no longer a

member of the Scientific Advisory Board.

As of December 31, 2025, the Company has accrued $ 177,309

related to Dr.

Hsu’s Scientific Advisory Board compensation.

WP744 Portfolio (Berubicin)

On November 21, 2017, the Company entered into a Collaboration and

Asset Purchase Agreement with Reata Pharmaceuticals, Inc.

Through this agreement, the Company purchased all of

Reata’s rights, title, interest and previously conducted research and development results in the chemical compound commonly known

as Berubicin.

In exchange for these rights, the Company agreed to pay Reata an amount equal to 2.25% of the net sales of Berubicin for

a period of 10 years from the Company’s first commercial sale of Berubicin plus $10,000.

Reata also agreed to collaborate with the

Company on the development of Berubicin, from time to time.

On December 28, 2017, the Company entered into a Technology Rights

and Development Agreement with Houston Pharmaceuticals, Inc.

HPI is affiliated with Dr.

Waldemar Priebe, our founder.

Pursuant to this agreement, the Company obtained a worldwide exclusive license to the chemical compound commonly known as WP744.

for these rights, the Company agreed to pay consideration to HPI as follows:

(i) a royalty of 2% of net sales of any product utilizing

WP744 for a period of ten years after the first commercial sale of such;

and (ii) $100,000 upon beginning Phase II clinical trials (paid

and (iii) $200,000 upon the approval by the FDA of a New Drug Application for any product utilizing WP744;

and (iv) a series

of quarterly development payments totaling $750,000 beginning immediately after the Company’s raise of $7,000,000 of investment

In addition, the Company issued 3 shares of the Company’s common stock valued at $3,375 per share to HPI upon execution

of the agreement.

On November 13, 2019, the Company closed its IPO, thereby fulfilling all conditions precedent and completing the acquisition

of the intellectual property discussed in the HPI agreement.

During the years ended December 31, 2024 and 2023, the Company recognized

$ 50,000 and $ 50,000 , respectively, related to this agreement.

Unrelated to this agreement, from time to time, the Company purchases pharmaceutical

products from HPI which are necessary for the manufacturing of Berubicin API and drug product.

During the years ended December 31, 2024

and 2023, the Company expensed $ 0 related to the purchase of pharmaceutical products from HPI.

This agreement was terminated March 23,

On August 30, 2018, we entered into a sublicense agreement with WPD

Pharmaceuticals, Inc.

Pursuant to the agreement, the Company granted WPD an exclusive sublicense, even as to us,

for the patent rights we licensed pursuant to the HPI License within the following countries:

Poland, Estonia, Latvia, Lithuania, Belarus,

Ukraine, Moldova, Romania, Bulgaria, Serbia, Macedonia, Albania, Armenia, Azerbaijan, Georgia, Montenegro, Bosnia, Croatia, Slovenia,

Slovakia, Czech Republic, Hungary, Chechnya, Uzbekistan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Greece, Austria, and Russia.

The sublicense agreement provides that WPD must use commercially reasonable development efforts to attempt to develop and commercialize

licensed products in the above mentioned territories, which means the expenditure of at least $2.0 million on the development, testing,

regulatory approval or commercialization of the licensed products during the three year period immediately following the date of the sublicense

In the event that WPD fails to use commercially reasonable development efforts by the foregoing three-year deadline, we have

the right to terminate this sublicense agreement.

As of December 31, 2021, the Company has received reports of the WPD expenditures related

to this agreement, has conducted due inquiry into validating those expenditures, and has determined that WPD has exercised commercially

reasonable development efforts and has therefore fulfilled the terms of the agreement necessary to secure their rights under the sublicense

in perpetuity subject to the ongoing obligations of the sublicense.

In consideration for the rights granted under the sublicense agreement,

to the extent we are required to make any payments to HPI pursuant to the HPI License as a result of this sublicense agreement, WPD agreed

to advance us such payments, and to pay us a royalty equal to 1% of such payments.

WPD is a Polish corporation and was affiliated with

This agreement was terminated March 23, 2025.

On November 21, 2022, CNS entered into an Investigational Medicinal

Product Supply Agreement with Pomeranian Medical University (“PUM”) in Szczecin, Poland.

CNS agreed to sell berubicin hydrochloride

drug product (and related reference standards) to PUM at a discount to the historical cost of manufacturing so that PUM may conduct an

investigator-initiated clinical trial of Berubicin in CNS lymphomas.

PUM agreed to pay CNS the following payments:

(i) PLN 5,870 upon

delivery of 2 vials each of berubicin and berubicinol reference standards, (ii) PLN 873,201 upon delivery of a first batch of 150 berubicin

drug product vials, and (iii) PLN 873,201 upon delivery of a second batch of 150 berubicin drug product vials.

As of December 31, 2022,

the reference standards were delivered, and the Company recognized $ 1,302 in accounts receivable and as a reduction to research and development

In April 2023, the first batch of berubicin drug product vials were delivered, and the Company recognized $ 196,303 in accounts

receivable and as a reduction to research and development expense.

As of December 31, 2023, the outstanding accounts receivable balance

of $ 197,605 was collected in full.

On August 31, 2018, the Company entered into a sublicense agreement

with Animal Life Sciences, LLC (“ALI”), pursuant to which we granted ALI an exclusive sublicense, even as to us, for the patent

rights we licensed pursuant to the HPI License solely for the treatment of cancer in non-human animals through any type of administration.

In consideration for the rights granted under the sublicense agreement, ALI agreed to issue us membership interests in ALI equal to 1.52%

of the outstanding ALI membership interests.

As additional consideration for the rights granted, to the extent we are required to make

any payments to HPI pursuant to the HPI License as a result of this sublicense agreement, ALI agreed to advance us such payments, and

to pay us a royalty equal to 1% of such payments.

Waldemar Priebe was an affiliate of ALI.

This agreement was terminated March 23,

On June 10, 2020, the FDA granted Orphan Drug Designation (“ODD”)

for Berubicin for the treatment of malignant gliomas.

ODD from the FDA is available for drugs targeting diseases with less than 200,000

cases per year.

ODD may enable market exclusivity of 7 years from the date of approval of an NDA in the United States.

During that period

the FDA generally could not approve another product containing the same drug for the same designated indication.

Orphan drug exclusivity

will not bar approval of another product under certain circumstances, including if a subsequent product with the same active ingredient

for the same indication is shown to be clinically superior to the approved product on the basis of greater efficacy or safety, or providing

a major contribution to patient care, or if the company with orphan drug exclusivity is not able to meet market demand.

The ODD now constitutes

our primary intellectual property protections although the Company is exploring if there are other patents that could be filed related

to Berubicin to extend additional protections.

On July 24, 2021, the Company received Fast Track Designation from

the FDA for Berubicin.

Fast Track Designation is designed to facilitate the development and expedite the review of drugs to treat

serious conditions and fill an unmet medical need.

WP1244 Portfolio

On January 10, 2020, Company entered into a Patent and Technology License

Agreement (the “WP1244 Agreement”) with The Board of Regents of The University of Texas System, an agency of the State of

Texas, on behalf of The University of Texas M.

Anderson Cancer Center (“UTMDACC”).

Pursuant to the WP1244 Agreement, the

Company obtained a royalty-bearing, worldwide, exclusive license to certain intellectual property rights, including patent rights, related

to the Company’s recently announced WP1244 drug technology.

In consideration, the Company must make payments to UTMDACC including

an up-front license fee, annual maintenance fee, milestone payments and royalty payments (including minimum annual royalties) on sales

of licensed products developed under the WP1244 Agreement.

The term of the WP1244 Agreement expires on the last to occur of:

(a) the expiration

of all patents subject to the WP1244 Agreement, or (b) fifteen years after execution;

provided that UTMDACC has the right to terminate

this WP1244 Agreement in the event that the Company fails to meet certain commercial diligence milestones.

The commercial diligence milestones

are as follows (i) initiated PC toxicology to support filing of Investigational New Drug Application (“IND”) or New Drug Application

(“NDA”) for the Licensed Product within the eighteen (18) month period following the Effective Date (ii) file and IND for

the Licensed Product within three (3) year period following the Effective Date and (iii) Commencement of Phase I Study within the five

(5) year period following the Effective Date.

The Company has not met the commercial diligence milestones and has not paid the annual

maintenance fee required as of the date hereof.

On May 25, 2024 the WP1244 Agreement was terminated.

There are no termination penalty

provisions in the Agreement.

During the year ended December 31, 2024 and 2023, the Company paid $ 52,537 and $ 55,092 , respectively.

Cortice Biosciences, Inc.

7 unchanged sentences

product in any of the included territories, which begins upon the first commercial sale in such territory and ends on the latest of (i)

ten years after such sale, (ii) the expiration of regulatory or marketing exclusivity for such licensed product in such country, or (c)

ten years after such sale, (ii) the expiration of regulatory or marketing exclusivity for such licensed product in such country, or (iii)

the expiration of the last to expire valid patent claim in such country covering such licensed product.

Pursuant to the Cortice Agreements,

the Company agreed to issue Cortice 11,468 shares of the Company’s common stock upon the closing of the transaction, which occurred

on July 29, 2024, and 867 shares of Company common stock upon the receipt of shareholder approval of such issuance as required by the

rules of the Nasdaq Stock Market.

The Company also agreed to make milestone payments to Cortice in either cash or shares of Company common

stock (at Cortice’s option) upon:

(i) meeting the primary endpoint a pivotal trial for a licensed product – either $15.0 million

or 8,223 shares of Company common stock;

(ii) FDA acceptance of an New Drug Application for a licensed product – either $30.0 million

or 16,446 shares of Company common stock;

(iii) the first commercial sale in the United States of a licensed product – either $45.0

million or 24,668 shares of Company common stock;

and (iv) the first commercial sale in Japan of a licensed product – either $10.0

million or 4,112 shares of Company common stock.

The Company’s obligation to pay the above milestones in Company common stock is

subject to the receipt of shareholder approval as required by the rules of the Nasdaq Stock Market.

The Company also agreed to pay Cortice

royalties on sales of licensed products of between 3.0%-7.5%.

Finally, to the extent Cortice is required to pay any milestone payments

to the original holder of the intellectual property rights licensed, the Company has agreed to make such payments to Cortice.

As of December

31, 2024, there were no accruals related to the milestone payments and the Company issued 11,468 Shares with a fair value of $ 596,303

the Company agreed to issue Cortice 956

shares of the Company’s common stock upon the closing of the transaction, which occurred on July 29, 2024, and 73

shares of Company common stock upon the receipt of shareholder approval of such issuance as required by the rules of the Nasdaq Stock

The Company also agreed to make milestone payments to Cortice in either cash or shares of Company common stock (at Cortice’s

option) upon:

(i) meeting the primary endpoint of a pivotal trial for a licensed product – either $15.0 million or 686 shares of

Company common stock;

(ii) FDA acceptance of a New Drug Application for a licensed product – either $30.0 million or 1,371 shares

of Company common stock;

(iii) the first commercial sale in the United States of a licensed product – either $45.0 million or 2,056

shares of Company common stock;

and (iv) the first commercial sale in Japan of a licensed product – either $10.0 million or 343

shares of Company common stock.

The Company’s obligation to pay the above milestones in Company common stock is subject to the

receipt of shareholder approval as required by the rules of the Nasdaq Stock Market.

The Company also agreed to pay Cortice royalties

on sales of licensed products of between 3.0%-7.5%.

Finally, to the extent Cortice is required to pay any milestone payments to the original

holder of the intellectual property rights licensed, the Company has agreed to make such payments to Cortice.

During the year ended December

31, 2024, the Company issued 956

shares of common stock with a fair value of $ 596,303

pursuant to the Cortice Agreement.

As of December 31, 2025, there were no accruals related to the milestone payments.

Note 6 – Income Taxes

11 unchanged sentences

Provision for income taxes

The Company adopted ASC 2023-09 during the year ended December 31, 2025

prospectively.

A reconciliation setting forth the differences between the effective tax rates and the U.S.

federal statutory tax rate

is as follows:

Year Ended December 31, 2025

US federal statutory tax rate

Changes in valuation allowances

Nontaxable or nondeductible items

Effective income tax rate

Significant components of the Company’s deferred tax assets and

20 unchanged sentences

Note 7 – Subsequent Events

On November 26, 2024, the stockholders of the Company approved the

granting to the Company’s board of directors of the discretion to effect the reverse stock split at a ratio in the range of 1-for-2

Upon the approval of the Company’s board of directors, The reverse stock split became effective on February 21, 2025

on a 1-for-50 basis without any change in the par value per share, which remained at $0.001.

The reverse stock split has been retroactively

adjusted throughout these financial statements and footnotes.

On March 11, 2025, the Company approved the issuance of options to

purchase 263,537 shares of common stock to the management group, subject to approval of an increase in the Company’s equity plan

by the Company’s shareholders.

Each of the options will vest as follows:

(i) 50% on the six month anniversary of the issuance date;

(ii) 25% on the 12 month anniversary of the issuance date;

and (iii) 25% on the 18 month anniversary of the issuance date.

price of the option is $2.50, the closing price on the date of the Board’s approval of the compensation plan.

On March 20, 2025, the Company increased the aggregate sales price

of common shares that may be sold under the AGP ATM Sales Agreement to $43.5 million.

Subsequent to December 31, 2024, the Company

has sold 1,530,985 Shares pursuant to the AGP ATM Sales Agreement for net proceeds of approximately $9.9 million.

On February 10, 2026, the Company entered into an employment agreement

with Steve O’Loughlin to serve as the Company’s Chief Financial Officer effective March 2, 2026.

The employment agreement

provides for an initial annual base salary of $450,000.

The employment agreement also provides for an initial grant of 9,500 restricted

stock units, vesting as follows:

25% on the six-month anniversary of the effective date, 25% on the twelve-month anniversary of the effective

date, and the remaining 50% in twelve quarterly installments thereafter, subject to continued employment.

Under the employment agreement,

O’Loughlin’s employment is terminated by the Company without cause or by Mr.

O’Loughlin for good reason, he will

be entitled to (i) severance equal to six months of base salary, payable over six months, (ii) his target annual bonus for the period

of time between the end of the last fiscal year and the termination date;

and (iii) accelerated vesting of all unvested equity previously

granted, in each case subject to his timely execution and non-revocation of a release of claims and continued compliance with applicable

On February 13, 2026, the Company entered into an employment agreement

with Christopher Downs, the Company’s current Chief Financial Officer, pursuant to which Mr.

Downs agreed to resign as Chief Financial

Officer effective March 2, 2026 and to serve as the Company’s Senior Vice President – Finance effective March 2, 2026.

employment agreement provides for an initial annual base salary of $350,000.

Under the employment agreement, if Mr.

Downs’s employment

is terminated by the Company without cause or by Mr.

Downs for good reason, he will be entitled to severance equal to six months of base

salary, payable over six months.

On February 26, 2026, the Company entered into an employment agreement

with Lynne Kelley to serve as the Company’s Chief Medical Officer effective March 2, 2026.

The employment agreement provides for

an initial annual base salary of $450,000.

The employment agreement also provides for an initial grant of 9,500 restricted stock units,

vesting as follows:

25% on the six-month anniversary of the effective date, 25% on the twelve-month anniversary of the effective date,

and the remaining 50% in twelve quarterly installments thereafter, subject to continued employment.

Under the employment agreement, if

Kelley’s employment is terminated by the Company without cause or by Dr.

Kelley for good reason, she will be entitled to (i)

severance equal to six months of base salary, payable over six months, (ii) her target annual bonus for the period of time between the

end of the last fiscal year and the termination date;

and (iii) accelerated vesting of all unvested equity previously granted.

On February 27, 2026, the Company and Dr.

Sandra Silberman, the Company’s

former Chief Medical Officer, entered into a Separation and Severance Agreement (the “Separation Agreement”), which memorializes

the terms of Dr.

Silberman’s separation from service with the Company.

Pursuant to the Separation Agreement, the Company will provide

severance benefits, equal to three months of Dr.

Silberman’s current annualized base salary, paid in three equal monthly installments.

On March 2, 2026, the Company entered into an employment agreement

with Dylan Wenke to serve as the Company’s Chief Business Officer effective March 2, 2026.

The employment agreement provides for

an initial annual base salary of $415,000.

The employment agreement also provides for an initial grant of 9,500 restricted stock units,

vesting as follows:

25% on the six-month anniversary of the effective date, 25% on the twelve-month anniversary of the effective date,

and the remaining 50% in twelve quarterly installments thereafter, subject to continued employment.

Under the employment agreement, if

Wenke’s employment is terminated by the Company without cause or by Dr.

Wenke for good reason, she will be entitled to (i) payment

of a prorated earned bonus, (ii) accelerated vesting of all unvested equity awards previously granted to the Executive, (iii) a severance

payment equal to six months of base salary plus target bonus, and (iv) Company paid COBRA continuation at active-employee rates for up

to six months.

On March 2, 2026, the Company entered into an employment agreement with

Eric Faulkner to serve as the Company’s Chief Technology Officer effective March 2, 2026.

The employment agreement provides

for an initial annual base salary of $450,000.

The employment agreement also provides for an initial grant of 9,500 restricted stock units,

vesting as follows:

25% on the six-month anniversary of the effective date, 25% on the twelve-month anniversary of the effective date,

and the remaining 50% in twelve quarterly installments thereafter, subject to continued employment.

Under the employment agreement, if

Faulkner’s employment is terminated by the Company without cause or by Dr.

Faulkner for good reason, she will be entitled to

(i) payment of a prorated earned bonus, (ii) accelerated vesting of all unvested equity awards previously granted to the Executive, (iii)

a severance payment equal to six months of base salary plus target bonus, and (iv) Company paid COBRA continuation at active-employee

rates for up to six months.

In March 2026, the Board of Directors approved, based upon the recommendation

of the Compensation Committee, cash bonuses totaling $418,800 to the officers of the Company.

Pursuant to the terms of the May 13, 2025 AGP ATM Sales Agreement,

the Company is permitted to sell from time to time through AGP, as sales agent or principal, shares of the Company’s common stock.

Subsequent to December 31, 2025, the Company has sold 178,933 Shares pursuant to the AGP ATM Sales Agreement for gross proceeds of approximately

Changes in and Disagreements with Accountants on Accounting and Financial Disclosures.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data