What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-14 compared with 2025-08-13 · 231 added, 179 removed, 28 unchanged (94% of the section changed)

Management’s Discussion and Analysis

of Financial Condition and Results of Operations

Management’s Discussion and Analysis of Financial

Condition and Results of Operations

Readers are advised to

review the following discussion and analysis of our financial condition and results of operations together with our consolidated financial

statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements

and related notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2024.

Some of the information contained in

this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy

for our business, includes forward-looking statements that involve risks and uncertainties.

See “Cautionary Note Regarding Forward-Looking

You should review the “Risk Factors” section of our Annual Report for the fiscal year ended December 31,

2024 for a discussion of important factors that could cause actual results to differ materially from the results described in or implied

by the forward-looking statements contained in the following discussion and analysis .

are a robotics company developing advanced robotics and drone-based systems.

Our advanced robotic system enables remote, real-time, pinpoint

accurate firing of small arms and light weapons that can achieve pinpoint accuracy regardless of the movement of the weapons platform

or the target.

We also introduced an insulator cleaning drone, which is a drone technology for conducting routine maintenance of critical

infrastructure for cleaning electric utility cable insulators.

were founded in 2014 as Unlimited Aerial Systems, LLP (“UAS LLP”), and until the consummation of the Share Exchange Agreement

(as hereinafter defined), we were a developer and manufacturer of commercial unmanned aerial systems, or drones, intending to provide

a superior Quadrotor aerial platform at an affordable price point in the law enforcement and first responder markets.

March 9, 2020, we closed on the Share Exchange Agreement (the “Share Exchange Agreement”), under which Duke Robotics, Inc.,

a Delaware corporation (“Duke Inc.”) became our majority-owned subsidiary (the “Share Exchange”).

date is referred to as the “Effective Time.” As a result of the Share Exchange, the Company adopted the business plan of Duke

April 29, 2020, we, Duke Inc., and UAS Acquisition Corp., a Delaware corporation and our wholly-owned subsidiary (“UAS Sub”),

executed an Agreement and Plan of Merger (the “Merger Agreement”), under which UAS Sub was to merge, upon the satisfaction

of customary closing conditions, with and into Duke Inc., with Duke Inc.

surviving as our wholly-owned subsidiary (the “Short-Form

Under the Merger Agreement, we intended to acquire the remaining outstanding shares of Duke Inc.

held by those certain

shareholders who did not participate in the Share Exchange.

statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (the “Quarterly Report”) and

the consolidated financial statements and related notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2024.

Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information

with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties.

“Cautionary Note Regarding Forward-Looking Statements”.

You should review the “Risk Factors” section of our Annual

Report for the fiscal year ended December 31, 2024, for a discussion of important factors that could cause actual results to differ materially

from the results described in or implied by the forward-looking statements contained in the following discussion and analysis .

We are a robotics company

developing advanced robotics and drone-based systems.

Our advanced robotic system enables remote, real-time, pinpoint accurate firing

of small arms and light weapons that can achieve pinpoint accuracy regardless of the movement of the weapons platform or the target.

also introduced an insulator cleaning drone, which is a drone technology for conducting routine maintenance of critical infrastructure

for cleaning electric utility cable insulators.

We were founded in 2014 as

Unlimited Aerial Systems, LLP (“UAS LLP”), and until the consummation of the Share Exchange Agreement (as hereinafter defined),

we were a developer and manufacturer of commercial unmanned aerial systems, or drones, intending to provide a superior Quadrotor aerial

platform at an affordable price point in the law enforcement and first responder markets.

On March 9, 2020, we closed

on the Share Exchange Agreement (the “Share Exchange Agreement”), under which Duke Robotics, Inc., a Delaware corporation

(“Duke Inc.”) became our majority-owned subsidiary (the “Share Exchange”).

Such closing date is referred to as

the “Effective Time.” As a result of the Share Exchange, the Company adopted the business plan of Duke Inc.

On April 29, 2020, we, Duke

Inc., and UAS Acquisition Corp., a Delaware corporation and our wholly-owned subsidiary (“UAS Sub”), executed an Agreement

and Plan of Merger (the “Merger Agreement”), under which UAS Sub was to merge, upon the satisfaction of customary closing

conditions, with and into Duke Inc., with Duke Inc.

surviving as our wholly-owned subsidiary (the “Short-Form Merger”).

the Merger Agreement, we intended to acquire the remaining outstanding shares of Duke Inc.

held by those certain Duke Inc.

who did not participate in the Share Exchange.

On June 25, 2020, Duke Inc.

filed a Certificate of Merger with the

State of Delaware, and consequently, Duke Inc.

filed a Certificate of Merger with the State of Delaware, and

consequently, Duke Inc.

became our wholly-owned subsidiary and the Short-Form Merger was consummated.

January 29, 2021, we, through Duke Airborne Systems Ltd.

(“Duke Israel”), and Elbit Systems Land Ltd., an Israeli corporation

(“Elbit”), entered into a collaboration agreement (the “Collaboration Agreement”) for the global marketing and

sales, and the production and further development by Elbit of our developed advanced robotic system mounted on a UAS, armed with lightweight

firearms, which we then marketed under the commercial name “TIKAD.” On April 2, 2025 we and Elbit executed a supplement letter

(the “Supplement Letter”) to the Collaboration Agreement relating to the stabilized weapons drone system technology that Elbit

has been marketing and deploying under the brand name “Birds of Prey”.

Pursuant to the Supplement Letter, we and

Elbit have agreed to expand their collaboration to allow us to market the system to military, defense, home-land security and

para-military customers, in coordination with Elbit.

We will be entitled to a commission fee, in the mid-single figure percentage

range, from any proceeds resulting from its marketing activities, in addition to the royalties it is entitled to as part of the Collaboration

August 15, 2022, Duke Israel introduced the Insulator Cleaning (“IC”) Drone, a drone technology for conducting routine maintenance

of critical infrastructure, and has signed an agreement with Israel Electric Corporation (the “IEC”) to provide drone-enabled

systems for cleaning electric utility cable insulators.

During October 2023, we completed our obligations under the agreement with

This was followed in August 2024, by a new agreement with the IEC to utilize our innovative IC Drone system for cleaning electric

On January 29, 2021, we, through

Duke Airborne Systems Ltd.

(“Duke Israel”), and Elbit Systems Land Ltd., an Israeli corporation (“Elbit”), entered

into a collaboration agreement (the “Collaboration Agreement”) for the global marketing and sales, and the production and

further development by Elbit of our developed advanced robotic system mounted on a UAS, armed with lightweight firearms, which we then

marketed under the commercial name “TIKAD.” On April 2, 2025 we and Elbit executed a supplement letter (the “Supplement

Letter”) to the Collaboration Agreement relating to the stabilized weapons drone system technology that Elbit has been marketing

and deploying under the brand name “Birds of Prey”.

Pursuant to the Supplement Letter, we and Elbit have agreed to expand

their collaboration to allow us to market the system to military, defense, home-land security and para-military customers, in coordination

We will be entitled to a commission fee, in the mid-single figure percentage range, from any proceeds resulting from its marketing

activities, in addition to the royalties it is entitled to as part of the Collaboration Agreement.

On August 15, 2022, Duke Israel

introduced the Insulator Cleaning (“IC”) Drone, a drone technology for conducting routine maintenance of critical infrastructure

and signed an agreement with Israel Electric Corporation (the “IEC”) to provide drone-enabled systems for cleaning electric

utility cable insulators.

On May 12, 2025, we announced the successful commencement of our 2025 insulator cleaning activity

in Israel with the IEC under our previously announced service agreement.

On June 10, 2025, we announced the launch of our next-generation

IC Drone System - the ICDS2 - representing a significant technological advancement in our innovative utility maintenance drone solution.

The ICDS2 features several key technological advancements over its predecessor, featuring extended flight time, higher payload capacity,

enhanced stability, advanced radar and improved cleaning durability.

It has been successfully deployed at the start of the insulator cleaning

season in May 2025, marking a full-season operational timeline compared to 2024’s mid-season commencement.

has a wholly-owned

subsidiary, Duke Israel, which was formed under the laws of the State of Israel in March 2014 and became the sole subsidiary of Duke Inc.

During October 2023, we completed our obligations under the agreement with the IEC.

This was followed in

August 2024, by a new agreement with the IEC to utilize our innovative IC Drone system for cleaning electric utility cable insulators.

May 12, 2025, we announced the successful commencement of our 2025 insulator cleaning activity in Israel with the IEC under our previously

announced service agreement.

On June 10, 2025, we announced the launch of our next-generation IC Drone System - the ICDS2 - representing

a significant technological advancement in our innovative utility maintenance drone solution.

The ICDS2 features several key technological

advancements over its predecessor, featuring extended flight time, higher payload capacity, enhanced stability, advanced radar and improved

cleaning durability.

It has been successfully deployed at the start of the insulator cleaning season in May 2025, marking a full-season

operational timeline compared to 2024’s mid-season commencement.

has a wholly-owned subsidiary, Duke Israel, which was formed

under the laws of the State of Israel in March 2014 and became the sole subsidiary of Duke Inc.

after its incorporation.

Our mailing address is 10 HaRimon Street, Mevo Carmel Science and Industrial Park, Israel 2069203, and our telephone

number is 011-972-4-8124101.

Our mailing address

is 10 HaRimon Street, Mevo Carmel, Israel 3903212, and our telephone number is +972-054-5707050.

Our website address is https://dukeroboticsys.com/.

as of October 22, 2020, our Common Stock began to be quoted on the OTCQB tier Venture Market, under the symbol “USDR”.

October 28, 2024, we filed a certificate of amendment (the “Certificate of Amendment”) to our Articles of Incorporation with

the Nevada Secretary of State to change the Company’s corporate name from UAS Drone Corp.

Effective as of October 22,

2020, our Common Stock began to be quoted on the OTCQB tier Venture Market, under the symbol “USDR”.

On October 28, 2024, we filed

a certificate of amendment (the “Certificate of Amendment”) to our Articles of Incorporation with the Nevada Secretary of

State to change the Company’s corporate name from UAS Drone Corp.

to DUKE Robotics Corp.

effective as of

November 4, 2024.

connection with the Certificate of Amendment, we also filed an issuer notification form with the Financial Industry Regulatory Authority

(“FINRA”) reflecting our name change and requesting a change in our trading symbol from “USDR” to “DUKR”.

Effective as of market open on Monday, November 4, 2024, the name changed to DUKE Robotics Corp.

and the transition of our OTCQB ticker

symbol from “USDR” to “DUKR” took effect.

February 18, 2025, we announced that we established Duke Robotics Hellas M I.K.E (“Duke Greece”), a wholly owned subsidiary,

formed under the laws of Greece, and on February 24, 2025 we appointed Mrs.

Alexandra Papaconstantinou to provide management services

as the Managing Director of Duke Greece.

effective as of November 4, 2024.

In connection with the Certificate

of Amendment, we also filed an issuer notification form with the Financial Industry Regulatory Authority (“FINRA”) reflecting

our name change and requesting a change in our trading symbol from “USDR” to “DUKR”.

Effective as of market open

on Monday, November 4, 2024, the name changed to DUKE Robotics Corp.

and the transition of our OTCQB ticker symbol from “USDR”

to “DUKR” took effect.

On February 18, 2025, we announced

that we established Duke Robotics Hellas M I.K.E (“Duke Greece”), a wholly owned subsidiary, formed under the laws of Greece,

and on February 24, 2025 we appointed Mrs.

Alexandra Papaconstantinou to provide management services as the Managing Director of Duke

On October 15, 2025, we filed a certificate of amendment to our Articles

of Incorporation with the Nevada Secretary of State to increase our authorized Common Stock from 100,000,000 shares of Common Stock,

$0.0001 par value per share, to 350,000,000 shares of Common Stock, $0.0001 par value per share, and permit the issuance of up to

10,000,000 shares of blank-check preferred stock, effective as of October 15, 2025.

Critical Accounting Policies

In connection with the preparation

of our financial statements, we were required to make assumptions and estimates about future events and apply judgments that affect the

reported amounts of assets, liabilities, revenue, expenses, and related disclosures.

We base our assumptions, estimates, and judgments

on historical experience, current trends, and other factors that management believes to be relevant at the time our consolidated financial

statements are prepared.

Regularly, management reviews the accounting policies, assumptions, estimates, and judgments to ensure that our

financial statements are presented fairly and by accounting principles generally accepted in the United States of America.

However, because

future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and

such differences could be material.

Please see Note 2 of Part

I, Item 1 of this Quarterly Report on Form 10-Q for the summary of significant accounting policies.

In addition, reference is made to

Part I, Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operation” of our Annual

Report on Form 10-K for the year ended December 31, 2024 (filed on March 20, 2025) concerning our Critical Accounting Policies and Estimates.

connection with the preparation of our financial statements, we were required to make assumptions and estimates about future events and

apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures.

We base our assumptions,

estimates, and judgments on historical experience, current trends, and other factors that management believes to be relevant at the time

our consolidated financial statements are prepared.

Regularly, management reviews the accounting policies, assumptions, estimates, and

judgments to ensure that our financial statements are presented fairly and by accounting principles generally accepted in the United States

However, because future events and their effects cannot be determined with certainty, actual results could differ from our

assumptions and estimates, and such differences could be material.

see Note 2 of Part I, Item 1 of this Quarterly Report on Form 10-Q for the summary of significant accounting policies.

In addition, reference

is made to Part I, Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operation of our Annual Report

on Form 10-K for the year ended December 31, 2024 (filed on March 20, 2025) concerning our Critical Accounting Policies and Estimates.

Results of Operations

Comparison of the three months ended June 30, 2025 and 2024

Revenues for the three months ended June 30, 2025 amounted to $143,000, compared to no revenues during the three months ended June

The primary reason for the increase in revenues is attributable to revenues from our IC Drone insulator cleaning

Initial revenues from royalties for sales of the “Birds of Prey” stabilized weapons drone systems, through

our Collaboration Agreement with Elbit, contributed for the first time to our revenues for the period, while the majority of the

revenues for the period continued to be generated from our IC Drone insulator cleaning activities.

Comparison of the three months ended September 30, 2025 and 2024

for the three months ended September 30, 2025, totaled $216,000, compared to $72,000 during the three months period ended September 30,

The increase in revenues was primarily attributable to the expansion of our IC Drone service operations, following the successful

launch of the full cleaning season in May 2025.

During 2024, the Company commenced its cleaning operations midway through the season,

which limited revenue generation for that period.

The increase in revenues during the three months ended September 30, 2025 was partially

offset by temporary disruptions to our regular business operations during the quarter, resulting from the ongoing military operations

in the Gaza Strip.

Cost of revenues .

Our cost of revenues for the three months ended June 30, 2025, amounted to $55,000, compared to no cost of revenues for the three

months ended June 30, 2024.

The increase in cost of revenues was mainly due to the costs associated with our IC Drone insulator cleaning

cost of revenues for the three months ended September 30, 2025, totaled $93,000, compared to $41,000 during the three months period ended

September 30, 2024.

The increase in cost of revenues was mainly due to the costs associated with

the increase in our IC Drone service operations.

Research and Development.

Our research and

development expenses for the three months ended June 30, 2025, amounted to $24,000, compared to $78,000 for the three months ended June

The decrease in research and development expenses was mainly due to allocating more resources to the execution of our IC Drone

insulator cleaning activities, and less on development activities.

Our research and development expenses for the three months ended September

30, 2025, amounted to $34,000, compared to $20,000 for the three months ended September 30, 2024.

The increase in research and development

expenses was mainly due to an increase in subcontracting expenses.

General and Administrative.

Our general and administrative expenses for the three months ended June 30, 2025, which consisted primarily of professional services,

stock-based compensation expenses and legal expenses, amounted to $314,000, compared to $215,000 for the three months ended June 30, 2024.

The increase in general and administrative expenses for the three months ended June 30, 2025 was mainly due to an increase in professional

services and in stock-based compensation expenses.

Our general and administrative expenses for the three months ended

September 30, 2025, which consisted primarily of professional services, stock-based compensation expenses and legal expenses, amounted

to $302,000, compared to $229,000, for the three months ended September 30, 2024.

The increase in general and administrative expenses

for the three months ended September 30, 2025, was mainly due to an increase in stock-based compensation expenses offset by a decrease

in professional services.

Financial Income (expenses),

For the three months ended June 30, 2025, we had financial expenses of $8,000 compared to financial income of $15,000 for the

three months ended June 30, 2024.

The reason for the decrease in financial income for the three months ended June 30, 2025, was mainly

due to the decrease in our cash bank deposits which resulted in a decrease in interest income.

a net loss of $269,000 for the three months ended June 30, 2025 as compared to a net loss of $278,000 for the three months ended June

For the three months ended September 30, 2025, we had financial expenses

of $17,000 compared to financial income of $7,000 for the three months ended September 30, 2024.

The reason for the increase in financial

expenses for the three months ended September 30, 2025, was mainly due to the decrease in the balance of our cash bank deposits which

resulted in a decrease in interest income.

a net loss of $230,000 for the three months ended September 30, 2025, as compared to $211,000 for the three months ended September 30,

2024, for the reasons set forth above.

Comparison of the six months ended June 30, 2025 and 2024

Revenues for the six months ended June 30, 2025 amounted to $143,000, compared to no revenues during the six months ended June 30,

The primary reason for the increase in revenues is attributable to revenues from our IC Drone insulator cleaning

Initial revenues from royalties for sales of the “Birds of Prey” stabilized weapons drone systems, through

our Collaboration Agreement with Elbit, contributed for the first time to our revenues for the period, while the majority of the

revenues for the period continued to be generated from our IC Drone insulator cleaning activities.

Comparison of the nine months ended September 30, 2025 and 2024

Revenues for the nine months ended September 30, 2025 totaled $359,000,

compared to $72,000 in revenues during the nine months period ended September 30, 2024.

The increase in revenues was primarily attributable

to the expansion of our IC Drone service operations, following the successful launch of the full cleaning season in May 2025.

the Company commenced its cleaning operations midway through the season, which limited revenue generation for that period.

in revenues for the nine months ended September 30, 2025 was partially offset by temporary disruptions to our regular business operations

during the third quarter of 2025, resulting from the ongoing military operations in the Gaza Strip.

Revenues also reflect the initial

recognition of revenues from royalties derived from sales of the “Bird of Prey” stabilized weapons drone systems, through

our Collaboration Agreement with Elbit, which contributed for the first time to our revenues for the period, while the majority of the

revenues for the period continued to be generated from our IC Drone service activities.

Cost of revenues .

cost of revenues for the six months ended June 30, 2025, amounted to $63,000, compared to $0 for the six months ended June 30,

The increase in cost of revenues was mainly due to our IC Drone insulator cleaning activities.

Our cost of revenues for the nine months ended September 30, 2025,

totaled to $156,000, compared to $41,000 in revenues during the nine months period ended September 30, 2024.

The increase is attributable

the increase in our IC Drone service activities.

Research and Development.

Our research and development expenses for the six months ended June 30, 2025, amounted to $45,000, compared to $117,000 for the six months

ended June 30, 2024.

The decrease in research and development expenses was mainly due to allocating more resources to the execution of

our IC Drone insulator cleaning activities, and less on development activities.

Our research and development expenses for the nine months ended September 30, 2025, amounted to $79,000, compared to $137,000 for the

nine months ended September 30, 2024.

The decrease in research and development expenses was mainly due to allocating more resources to

the execution of our IC Drone insulator service activities, and less on development activities.

General and Administrative.

Our general and administrative expenses for the six months ended June 30, 2025, which consisted primarily of professional services, stock-based

compensation expenses and legal expenses, amounted to $573,000, compared to $406,000 for the six months ended June 30, 2024.

in general and administrative expenses for the six months ended June 30, 2025 was mainly due to an increase in professional services and

in stock-based compensation expenses.

Financial Income, net.

For the six months ended June 30, 2025, we had financial income of less than $1,000 compared to financial income of $36,000 for the six

months ended June 30, 2024.

The reason for the decrease in financial income for the six months ended June 30, 2025, was mainly due to

the decrease in our cash bank deposits which resulted in a decrease in interest income.

a net loss of $548,000 for the six months ended June 30, 2025 as compared to a net loss of $487,000 for the six months ended June 30,

Our general and administrative expenses for the nine months ended September 30, 2025, which consisted primarily of professional services,

stock-based compensation expenses and legal expenses, amounted to $875,000, compared to $636,000 for the nine months ended September 30,

The increase in general and administrative expenses for the nine months ended September 30, 2025, was mainly due to an increase

in professional services and in stock-based compensation expenses.

Financial Income (expenses),

For the nine months ended September 30, 2025, we had financial expenses

of $17,000 compared to financial income of $44,000 for the nine months ended September 30, 2024.

The reason for the increase in financial

expenses for the nine months ended September 30, 2025, was mainly due to the decrease in the balance of our cash bank deposits which resulted

in a decrease in interest income.

a net loss of $778,000 for the nine months ended September 30, 2025, as compared to a net loss of $698,000 for the nine months ended September

30, 2024, for the reasons set forth above.

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We had $361,000 in cash on

June 30, 2025 versus $ 1,766,000 in cash on June 30, 2024.

The reason for the decrease in our cash balance was due to the operating expenses

described above.

Cash used in operations for the six months ended June 30, 2025 was $578,000 as compared to cash used in operations of

$514,000 for the six months ended June 30, 2024.

The reason for the increase in cash used in operations is mainly related to increase

in our operating expenses described above.

Net cash used in investing activities was $96,000

for the six months ended June 30, 2025, as compared to net cash used in investing activities of $0 for the six months ended June 30, 2024.

September 30, 2025, versus $1,436,000 in cash on September 30, 2024.

The reason for the decrease in our cash balance was due to the operating

expenses described above.

Cash used in operations for the nine months ended September 30, 2025, was $741,000 as compared to cash used

in operations of $739,000 for the nine months ended September 30, 2024.

Net cash used in investing

activities was $152,000 for the nine months ended September 30, 2025, as compared to net cash used in investing activities of $76,000

for the nine months ended September 30, 2024.

The increase is mainly related to purchase of property and equipment.

On May 11, 2021, we entered

into securities purchase agreements with eight (8) non-U.S.

Investors, pursuant to which we, in a private placement offering, agreed to

issue and sell to investors an aggregate of:

May 11, 2021, we entered into securities purchase agreements with eight (8) non-U.S.

Investors, pursuant to which we, in a private placement

offering, agreed to issue and sell to investors an aggregate of:

(i) 12,500,000 shares of our Common Stock at a price of $0.40 per share;

and (ii) warrants

to purchase 12,500,000 of our Common Stock.

The warrants were exercisable immediately and for a term of 18 months and have an exercise

price of $0.40 per share.

The aggregate gross proceeds from the offering were approximately $5,000,000 and the offering closed on May

On April 5, 2022, we entered into an agreement with the Investors pursuant to which we extended the term of the warrants, to

expire on November 11, 2023.

On November 1, 2023, we and the Investors executed a second extension agreement, such that the term of the

warrants was extended to expire on November 11, 2024.

On June 20, 2024, we entered into a Warrant Amendment Agreement with the Investors

to amend the terms of the warrants issued in connection with the May 11, 2021 securities purchase agreements.

Under the Warrant Amendment

Agreement, we and the Investors agreed to:

and (ii) warrants to purchase 12,500,000 of our Common Stock.

The warrants were exercisable immediately and for a term of 18 months and

have an exercise price of $0.40 per share.

The aggregate gross proceeds from the offering were approximately $5,000,000 and the offering

closed on May 11, 2021.

On April 5, 2022, we entered into an agreement with the Investors pursuant to which we extended the term of the

warrants, to expire on November 11, 2023.

On November 1, 2023, we and the Investors executed a second extension agreement, such that the

term of the warrants was extended to expire on November 11, 2024.

On June 20, 2024, we entered into a Warrant Amendment Agreement with

the Investors to amend the terms of the warrants issued in connection with the May 11, 2021 securities purchase agreements.

Warrant Amendment Agreement, we and the Investors agreed to:

(i) extend the warrant exercise term to May 11, 2026;

(ii) amend the warrant exercise price,

increasing it from $0.40 per share to $0.65 per share;

and (iii) include a beneficial ownership blocker that limits the exercise of such

warrants if the exercise would result in the holder beneficially owning more than 19.99% of the Company’s common stock immediately

following the exercise.

believe that we have sufficient cash to fund our operations for at least the next 12 months.

Readers are advised that available resources

may be consumed more rapidly than currently anticipated, resulting in the need for additional funding sooner than expected.

occur, we will need to seek additional capital earlier than anticipated in order to fund (1) further development and, if needed (2) expenses

which will be required in order to expand manufacturing of our products, (3) sales and marketing efforts and (4) general working capital.

Such funding may be unavailable to us on acceptable terms, or at all.

Our failure to obtain such funding when needed could create a negative

impact on our stock price or could potentially lead to the failure of our company.

This would particularly be the case if we are unable

to commercially distribute our products and services in the jurisdictions and in the timeframes we expect.

(ii) amend the warrant

exercise price, increasing it from $0.40 per share to $0.65 per share;

and (iii) include a beneficial ownership blocker that limits the

exercise of such warrants if the exercise would result in the holder beneficially owning more than 19.99% of the Company’s common

stock immediately following the exercise.

Since our incorporation, we

incurred losses from operations and net cash outflows from operating activities as reflected in the consolidated statements of operations

and cash flows.

As of September 30, 2025, we had an accumulated deficit of $11,940,000, and we expect to incur losses for the foreseeable

We have historically financed our operations primarily through fundraising from various investors and the revenues that were generated

from our operations to date were not sufficient to cover our losses.

As a result, we remain dependent upon external sources to finance

our operations.

There can be no assurance that we will succeed in obtaining the necessary financing to continue our operations.

factors raise substantial doubt about our ability to continue as a going concern through at least twelve months from the date of this

Quarterly Report.

We currently believe that

our existing capital resources will be sufficient to support our operating plan through the second quarter of 2026.

To support our planned

growth, strategic initiatives and general working capital needs, we will likely seek to raise additional capital through the issuance

of debt, equity, or a combination thereof.

There can be no assurance we will be successful in raising additional capital on favorable

terms, or at all.

Although we are actively pursuing

opportunities to increase revenues, including the potential expansion of commercial sales in additional jurisdictions, some of these efforts

remain at an early stage while other initiatives have progressed to more advanced stages of discussion.

However, because none of these

initiatives have resulted in binding agreements or firm commitments, there can be no assurance that any of them will materialize within

our expected timeframes.

If we are unable to successfully proceed with these initiatives, our need for additional capital may accelerate.

As a result, there is substantial

doubt about our ability to continue as a going concern.

If we are unable to obtain sufficient amounts of additional capital, we may be

required to reduce the scope of our operations, delay or discontinue development activities, limit our manufacturing or commercial expansion

plans, or take other actions that could materially harm our business, financial condition, and operating results.

If we obtain additional

funds by selling any of our equity, the percentage ownership of our stockholders will be reduced, stockholders may experience additional

dilution, or the equity securities may have rights preferences or privileges senior to the common stock.

If we issue debt securities,

there may be negative covenants which may restrict our company’s activities.

If adequate funds are not available to our company

when needed on satisfactory terms, we may be required to cease operating or otherwise modify our business strategy.

The financial statements

included in this Quarterly Report do not include adjustments for measurement or presentation of assets and liabilities, which may be required

should we fail to operate as a going concern.

Off-Balance Sheet Arrangements

As of June 30, 2025, we did

not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

As of September 30, 2025,

we did not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

Quantitative and Qualitative Disclosures About Market Risk.

2 unchanged sentences

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-Q

Item 2. Management’s Discussion and Analysis