What changed in this filing

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Item 1. Financial Statements

2025-08-18 compared with 2025-05-15 · 365 added, 268 removed, 655 unchanged (49% of the section changed)

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Current assets:

Cash and cash equivalents

Prepaid expenses

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Notes payable

Other liabilities

Total current liabilities

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Preferred stock, par value $ 0.0001 , 100,000,000 shares authorized;

0 issued and outstanding

500 and 0 issued and outstanding as of June 30, 2025 and December 31, 2024, respectively

Common stock, par value $ 0.0001 , 1,000,000,000 shares authorized;

28,510,632 and 15,130,393 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively

52,703,070 and 27,080,915 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

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OF OPERATIONS

Three Months Ended

March 31, 2025

March 31, 2024

For the Three Months Ended

For the Six Months Ended

Operating expenses:

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General and administrative

Research and development

Share-based compensation

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( 1,892,852 )

( 3,479,820 )

Other income (expense):

Interest Expense

( 1,760,025 )

( 2,313,962 )

Change in fair value of warrant liability

2 unchanged sentences

Total other income (expense)

( 2,200,379 )

( 2,847,393 )

Net loss before income taxes

2 unchanged sentences

( 1,123,683 )

$ ( 4,093,231 )

$ ( 451,639 )

$ ( 6,327,213 )

$ ( 1,123,683 )

Net loss per share:

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Preferred Stock

Stockholder’s

(Series B, C and D)

Stockholder’s

Balance, January 1, 2024*

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$ ( 4,597,632 )

Preferred Stock

Stockholder’s

(Series B, C and D)

Share-based compensation

Adjustment from reverse merger application*

$ ( 1,780,834 )

( 1,474,758 )

Public warrants assumed from SPAC

Private warrants assumed from SPAC

Balance at June 30, 2024

$ ( 5,536,110 )

$ ( 1,551,395 )

Balance, January 1, 2025

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$ ( 12,796,781 )

as a result of the business combination as recast, the shares of the Company’s common stock prior to the Business Combination (refer

to Note 1) have been retrospectively recast to reflect the change in the capital structure as a result of the Business Combination on

Share-based compensation

Issuance of common shares in connection with note conversions

Issuance of common shares in connection with warrant exercises

Issuance of common shares in connection with stock subscriptions

Termination of shares issued during merger under FPA agreement

Issuance of Preferred B stock for cash

Deemed dividend - warrant modification

( 1,530,910 )

( 4,093,231 )

Balance at June 30, 2025

$ ( 16,890,012 )

as a result of the business combination as recast, the shares of the Company’s common stock prior to the Business Combination (refer to Note 1) have been retrospectively recast to reflect the change in the capital structure as a result of the Business Combination on 6/21/24.

See accompanying notes to the unaudited condensed

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OF CASH FLOWS

For the Three Months Ended March 31,

For the Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

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Changes in fair value of warrant liability

Commitment fee

Interest expense

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$ ( 3,522,178 )

$ ( 929,399 )

CASH FLOWS FROM INVESTING ACTIVITIES:

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CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from convertible promissory note

Payments for deferred financing cost

Proceeds from FPA purchase by a third party

Payments on financed director and officer insurance

Proceeds from convertible promissory note, net of issuance cost

Proceeds from sales of stocks and warrants, net

Proceeds from stock subscriptions

Proceeds from sale of preferred B shares

Payments on notes payable

( 2,730,182 )

Payments for deferred financing costs

Proceeds from FPA settlement

Payments on financed director and officer insurance

Merger proceeds net of transaction cost

Net cash provided by financing activities

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Note payable settled with issuance of common stock

Reversal of OID

Non-cash directors and officers insurance

Non-cash PIPE Funds used for merger transaction close

Commitment fee paid in stock

Assumed income tax payable from merger

Assumed warrant liability from merger

Interest payable settled with issuance of common stock

Issuance of warrants

Repurchase of warrants

SUPPLEMENTAL CASH FLOW INFORMATION:

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Combination Agreement and after giving effect to the redemptions of shares of Redwoods Common Stock:

total consideration paid at Closing (the “Merger Consideration”) by Redwoods to ANEW Medical, Inc.

security holders was 6,000,000

shares of the Company common stock valued at $ 60 million (the “Consideration Shares”), based on an implied ANEW equity value

of $ 60,000,000 valued at $ 10 per share;

share of ANEW Medical Common Stock, if any, that was owned by Redwoods, Merger Sub, ANEW Medical, Inc.

or any other affiliate of Redwoods

immediately prior to the effective time of the Merger (the “Effective Time”) was automatically cancelled and retired without

any conversion or consideration;

share of Merger Sub common stock, par value $ 0.0001 per share (“Merger Sub Common Stock”), issued and outstanding immediately

prior to the Effective Time was converted into one newly issued share of Common Stock of the Surviving Corporation.

● The total consideration paid at Closing (the “Merger Consideration”) by Redwoods to ANEW Medical, Inc.

security holders was 6,000,000 shares of the Company common stock valued at $ 60 million (the “Consideration Shares”), based on an implied ANEW equity value of $ 60,000,000 valued at $ 10 per share;

Each share of ANEW Medical Common Stock, if any, that was owned by Redwoods, Merger Sub, ANEW Medical, Inc.

or any other affiliate of Redwoods immediately prior to the effective time of the Merger (the “Effective Time”) was automatically cancelled and retired without any conversion or consideration;

● Each share of Merger Sub common stock, par value $ 0.0001 per share (“Merger Sub Common Stock”), issued and outstanding immediately prior to the Effective Time was converted into one newly issued share of Common Stock of the Surviving Corporation.

In connection with the Merger, the Company

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conditions being met:

(i) 1,000,000

Contingent Consideration Shares upon the Company’s common stock achieving a closing price equal to or exceeding $ 15.00 for 10 trading

days within a 20 -day trading period in the first three years following the Closing;

(ii) 1,000,000

Contingent Consideration Shares upon the Company’s common stock achieving a closing price equal to or exceeding $ 20.00 for 10 trading

days within a 20 -day trading period in the first five years following the Closing.

(i) 1,000,000 Contingent Consideration Shares upon the Company’s common stock achieving a closing price equal to or exceeding $ 15.00 for 10 trading days within a 20 -day trading period in the first three years following the Closing;

(ii) 1,000,000 Contingent Consideration Shares upon the Company’s common stock achieving a closing price equal to or exceeding $ 20.00 for 10 trading days within a 20 -day trading period in the first five years following the Closing.

In accordance with guidance applicable to these

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Going Concern

The accompanying unaudited condensed consolidated

financial statements have been prepared as if the Company will continue as a going concern.

The Company has incurred significant operating

losses and negative cash flows from operations since inception.

As of March 31, 2025, the Company had cash of approximately $ 566,000 and

an accumulated deficit of approximately $ 12.8 million.

The Company has incurred recurring losses, has experienced recurring

negative operating cash flows, and requires significant cash resources to execute its business plans.

The Company is dependent on obtaining

additional working capital funding from the sale of equity and/or debt securities in order to continue to execute its development plans

and continue operations.

Without additional funding, there is substantial doubt about the Company’s ability to continue as a going

concern for twelve months from the date of these financial statements.

The accompanying unaudited condensed consolidated financial statements

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

The Company has incurred significant operating losses and negative

cash flows from operations since inception.

As of June 30, 2025, the Company had cash of approximately $ 8.4 million and an accumulated

deficit of approximately $ 16.9 million.

The Company has incurred recurring losses, has experienced recurring negative operating

cash flows, and requires significant cash resources to execute its business plans.

The Company is dependent on obtaining additional working

capital funding from the sale of equity and/or debt securities in order to continue to execute its development plans and continue operations.

Without additional funding, there is substantial doubt about the Company’s ability to continue as a going concern for twelve months

from the date of these financial statements.

Basis of Presentation and Principles of Consolidation

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Depository Insurance Coverage of $ 250,000 .

As of March 31, 2025, the Company has not experienced losses on this account and management

As of June 30, 2025, the Company has not experienced losses on this account and management

believes the Company is not exposed to significant risks on such account.

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Fair value measurements at reporting date using:

Quoted prices in active markets for identical liabilities (Level 1)

Quoted prices in active markets

for identical

liabilities (Level 1)

Significant other

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Significant unobservable inputs

Representative warrant liabilities, March 31, 2025

Cash equivalents, June 30, 2025

Cash equivalents, December 31, 2024

Representative warrant liabilities, June 30, 2025

Representative warrant liabilities, December 31, 2024

The following tables present a reconciliation

of the Level 3 Private Warrants liabilities:

The following tables present a reconciliation of the Level 3 Representative

Warrants liabilities:

Three Months Ended

Representative warrant liabilities, April 1

Change in fair value

Representative warrant liabilities, June 30

Representative warrant liabilities, January 1

Change in fair value

Representative warrant liabilities, March 31

Representative warrant liabilities, June 30

Intangible Assets

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For the Three Months Ended

For the Six Months Ended

$ ( 4,093,231 )

$ ( 451,639 )

$ ( 6,327,213 )

$ ( 1,123,683 )

Weighted-average common shares outstanding, basic and diluted

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from the calculation of weighted average common shares outstanding, because their inclusion would have been anti-dilutive:

For the Three Months Ended

As of June 30,

Preferred Shares B

Total potentially dilutive shares

Research and Development Cost

Research and development (R&D) costs are expensed

Research and development (R&D) costs are expensed as incurred.

R&D costs are related to the Company’s internally funded development of the Company medical licenses and patents.

Company R&D costs were $ 0 for the three and Three Months ended March 31, 2025 and 2024, respectively.

R&D costs were $ 238,700 and $0 for the three and six months ended June 30, 2025 and 2024, respectively.

Share-based Compensation

The Company accounts for share-based compensation

in accordance with the fair value recognition provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards

Codification (“ASC”) No.

The Company issues restricted stock to employees and consultants for their services.

Cost for these transactions are measured at the fair value of the equity instruments issued at the date of grant.

These shares are considered

fully vested and the fair market value is recognized as an expense in the period granted.

The Company recognized consulting expenses and

a corresponding increase to additional paid-in-capital related to stock issued for services.

For agreements requiring future services,

the consulting expense is to be recognized ratably over the requisite service period.

The Company recorded share-based compensation

of $ 495,500 and $ 278,251 for the Three Months ended March 31, 2025, and 2024, respectively.

As of March 31, 2025, the fair value of the Representative

The Company accounts for share-based

compensation in accordance with the fair value recognition provisions of the Financial Accounting Standards Board

(“FASB”) Accounting Standards Codification (“ASC”) No.

The Company issues restricted stock

and stock options to employees and consultants for their services.

Costs for these transactions are measured at the fair value of

the equity instruments issued at the date of grant.

These shares are considered fully vested and the fair market value is recognized

as an expense in the period granted.

The Company recognized consulting expenses and a corresponding increase to additional

paid-in-capital related to stock issued for services.

For agreements requiring future services, the consulting expense is to be

recognized ratably over the requisite service period.

The Company recorded share-based compensation of $ 390,195 and $ 37,514

for the three months ended June 30, 2025, and 2024, respectively.

The Company recorded share-based compensation of $ 885,695 , and $ 37,514

for the six months ended June 30, 2025 and 2024, respectively.

As of June 30, 2025, the fair value of the Representative

Warrant liabilities was $ 132,447 based on the closing price of the warrants on The Nasdaq Capital Market.

The fair value of the Representative

Warrants was approximately $ 0.02 per Representative Warrant, which was based on the relative fair value to the Public Warrants.

the three months ended March 31, 2025, the fair value of the Representative warrants decreased by $ 13,515 .

Warrants was approximately $ 0.25 per Representative Warrant as of June 30, 2025, which was based on the relative fair value to the Public

During the three months ended June 30, 2025, the fair value of the Representative warrants increased by $ 121,476 .

six months ended June 30, 2025, the fair value of the Representative warrants increased by $ 107,961 .

Related Parties

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Segment Information

Operating segments are defined as components of an enterprise for which

separate discrete information is available for evaluation by the Chief Operating Decision Maker (“CODM”) or decision-making

group in deciding how to allocate resources and in assessing performance.

The Company views its operations and manages its business as

one operating and reporting segment, which is the business of research and development of essential medicines for the treatment of chronic

diseases – cancer, cardiovascular, and neurodegenerative disorders.

See Note 11 Segment Information for additional information.

Operating segments are defined as components of

an enterprise for which separate discrete information is available for evaluation by the Chief Operating Decision Maker (“CODM”)

or decision-making group in deciding how to allocate resources and in assessing performance.

The Company views its operations and manages

its business as one operating and reporting segment, which is the business of research and development of essential medicines for the

treatment of chronic diseases – cancer, cardiovascular, and neurodegenerative disorders.

See Note 11 Segment Information for additional

Recent Accounting Pronouncements

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Prepaid expenses consist of prepayment of the

premium on Directors and Officers insurance.

As of March 31, 2025 and December 31, 2024, prepaid expenses totaled $ 121,843 and $ 94,070 ,

respectively, in the accompanying condensed consolidated balance sheets.

premium on Directors and Officers insurance, NASDAQ annual fees, association membership fees, and Delaware franchise taxes.

30, 2025 and December 31, 2024, prepaid expenses totaled $ 115,386 and $ 94,070 , respectively, in the accompanying condensed consolidated

balance sheets.

NOTE 4 — INTANGIBLE ASSETS

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Intangible assets are as follows:

● Non-Exclusive

License Agreement ($ 179,821 ) – On March 5, 2023, the Company signed a Non-Exclusive License Agreement with Heidelberg University

to grant non-exclusive rights to various licenses owned and under development by the university.

The licenses include the use of modified

AAV capsid polypeptides for treatment of muscular diseases.

The terms include a € 50,000 ($ 56,325 ) fee for signing the agreement

and € 100,000 ($ 112,650 ) payment within 60 days of the anniversary of signing the agreement.

The Company will pay € 1,000,000

($ 1,126,500 ) for each assignment of a right to a license owned by the university.

For new licenses, the Company will make standard commercial

development-based milestone payments for the various stages of license development and regulatory approval.

The Company will make 2 %

royalty payments by January 31 st each year during the term of the agreement for each licensed product for the proceeding

calendar year.

The value of the licenses was $ 179,821 at March 31, 2025 and December 31, 2024, respectively.

Generic Drugs ($ 736,983 ) - During 2015, the Company acquired two licenses for biosimilar biologic therapies to treat cancer and

autoimmune diseases.

The value of the licenses was $ 736,983 at March 31, 2025 and December 31, 2024, respectively.

Generic Drugs (Encore) ($ 1,308,270 ) – On September 12, 2022, the Company acquired four market-approved anti-cancer

drugs approved for sale in Germany for $ 1,308,270 .

The purchase price represents the fair value of the intangible asset based on

the net present value of the projected gross profit to be generated by the licenses.

The value of the licenses was $ 1,308,270 at March

31, 2025 and December 31, 2024.

● Needleless Syringe License ($ 26,060 ) – On December 1, 2023, the Company signed a license agreement with TransferTech

Sherbooke for the rights to develop and commercialize the technology of a “Needleless Syringe.” Under the terms of the agreement,

the Company paid a $ 26,060 upfront fee and royalty fees on the license income.

● Non-Exclusive License Agreement ($ 179,821 ) – On March 5, 2023, the Company signed a Non-Exclusive License Agreement with Heidelberg University to grant non-exclusive rights to various licenses owned and under development by the university.

The licenses include the use of modified AAV capsid polypeptides for treatment of muscular diseases.

The terms include a € 50,000 ($ 56,325 ) fee for signing the agreement and € 100,000 ($ 112,650 ) payment within 60 days of the anniversary of signing the agreement.

The Company will pay € 1,000,000 ($ 1,126,500 ) for each assignment of a right to a license owned by the university.

For new licenses, the Company will make standard commercial development-based milestone payments for the various stages of license development and regulatory approval.

The Company will make 2 % royalty payments by January 31 st each year during the term of the agreement for each licensed product for the proceeding calendar year.

The value of the licenses was $ 179,821 at June 30, 2025 and December 31, 2024, respectively.

● Various Generic Drugs ($ 736,983 ) - During 2015, the Company acquired two licenses for biosimilar biologic therapies to treat cancer and autoimmune diseases.

The value of the licenses was $ 736,983 at June 30, 2025 and December 31, 2024, respectively.

● Four Generic Drugs (Encore) ($ 1,308,270 ) – On September 12, 2022, the Company acquired four market-approved anti-cancer drugs approved for sale in Germany for $ 1,308,270 .

The purchase price represents the fair value of the intangible asset based on the net present value of the projected gross profit to be generated by the licenses.

The value of the licenses was $ 1,308,270 at June 30, 2025 and December 31, 2024.

● Needleless Syringe License ($ 26,060 ) – On December 1, 2023, the Company signed a license agreement with TransferTech Sherbooke for the rights to develop and commercialize the technology of a “Needleless Syringe.” Under the terms of the agreement, the Company paid a $26,060 upfront fee and royalty fees on the license income.

The Company has not commenced developing the technology.

The amount paid under the agreement is $ 26,060 at March 31, 2025 and December 31, 2024, respectively.

● Patents ($ 48,420 ) – Through its licensing arrangements, the Company acquires the right

to patents for Alzheimer, ALS, and other items.

Once the patents are declared effective, patents are amortized using the straight-line

method over their estimated useful lives or statutory lives, whichever is shorter, and will be reviewed for impairment upon any triggering

event that may impact the assets’ ultimate recoverability as prescribed under the guidance related to impairment of long-lived assets.

Costs incurred to acquire patents, including legal costs, are also capitalized as long-lived assets and amortized on a straight-line

basis with the associated patent.

The patent value, which is part of licenses in the accompanying condensed consolidated balance sheet,

as of March 31, 2025 and December 31, 2024, was $ 48,420 , respectively.

● Exclusive World-wide License Agreement - On January 24, 2022, the Company signed an exclusive, world-wide License

Agreement with the University of Barcelona for a cell and/or gene therapy that has shown compelling activity in animal models of human

Alzheimer’s disease and amyotrophic lateral sclerosis (“ALS” or “Lou Gehrig’s disease”).

therapy will also be applied to age-related diseases and rare (“Orphan”) diseases.

Beginning on December 15, 2022, the annual

license fee is 10,000 Euros.

In addition, the Company will pay a Royalty equal to 3 % of net sales of finished products once the license

As of March 31, 2025 and December 31, 2024, the Company owed $ 0 under the agreement.

The amount paid under the agreement is $ 26,060 at June 30, 2025 and December 31, 2024, respectively.

● Patents ($ 48,420 ) – Through its licensing arrangements, the Company acquires the right to patents for Alzheimer, ALS, and other items.

Once the patents are declared effective, patents are amortized using the straight-line method over their estimated useful lives or statutory lives, whichever is shorter, and will be reviewed for impairment upon any triggering event that may impact the assets’ ultimate recoverability as prescribed under the guidance related to impairment of long-lived assets.

Costs incurred to acquire patents, including legal costs, are also capitalized as long-lived assets and amortized on a straight-line basis with the associated patent.

The patent value, which is part of licenses in the accompanying condensed consolidated balance sheet, as of June 30, 2025 and December 31, 2024, was $ 48,420 , respectively.

● Exclusive World-wide License Agreement - On January 24, 2022, the Company signed an exclusive, world-wide License Agreement with the University of Barcelona for a cell and/or gene therapy that has shown compelling activity in animal models of human Alzheimer’s disease and amyotrophic lateral sclerosis (“ALS” or “Lou Gehrig’s disease”).

The gene therapy will also be applied to age-related diseases and rare (“Orphan”) diseases.

Beginning on December 15, 2022, the annual license fee is 10,000 Euros.

In addition, the Company will pay a Royalty equal to 3 % of net sales of finished products once the license is in use.

As of June 30, 2025 and December 31, 2024, the Company owed $ 0 under the agreement.

These licenses and patents are not currently in

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NOTE 5 — ACCOUNTS PAYABLE AND ACCRUED

Accounts payable and accrued expenses consist

of professional fees.

The accounts payable and accrued expenses as of March 31, 2025 and December 31, 2024 were $ 547,565 and $ 975,781 ,

respectively, in the accompanying condensed consolidated balance sheet.

Accounts payable and accrued expenses consist of professional fees.

The accounts payable and accrued expenses as of June 30, 2025 and December 31, 2024 were $ 62,962 and $ 975,781 , respectively, in the accompanying

condensed consolidated balance sheet.

NOTE 6 — NOTES PAYABLE TO RELATED PARTIES

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The promissory note accrued interest at

a one-time interest fee of $ 2,460 , which was paid off in full as of March 31, 2025.

a one-time interest fee of $ 2,460 , which was paid off in full as of June 30, 2025.

The unpaid principal balance was $0 and $ 31,000 at

March 31, 2025 and December 31, 2024, respectively.

June 30, 2025 and December 31, 2024, respectively.

NOTE 7 — NOTES PAYABLE

Upper Clapton Convertible Promissory Note

On September 12, 2022, the Company issued a $ 1,308,270 promissory note

used to acquire four market-approved anti-cancer drugs.

See Note 4 – Intangible Assets for further discussion.

On September 12, 2022, the Company issued a $ 1,308,270

promissory note used to acquire four market-approved anti-cancer drugs.

See Note 4 – Intangible Assets for

further discussion.

The promissory note bore interest at 6 % and had a maturity date of June 30, 2023 .

Pursuant to the agreement, the interest stopped accruing

at June 30, 2023.

As of December 31, 2023, the Company made interest payments of $ 78,496 to fully satisfy the interest obligation under

the promissory note.

The note was converted into the Company’s common shares and fully settled as part of the merger that closed

on June 21, 2024.

The outstanding principal balance of the note was $ 0 at March 31, 2025 and December 31, 2024, respectively.

Pursuant to the agreement, the interest

stopped accruing at June 30, 2023.

As of December 31, 2023, the Company made interest payments of $ 78,496 to fully satisfy the interest

obligation under the promissory note.

The note was converted into the Company’s common shares and fully settled as part of the merger

that closed on June 21, 2024.

The outstanding principal balance of the note was $ 0 at June 30, 2025 and December 31, 2024, respectively.

Redwoods PIPE Investor Convertible Promissory

On March 4, 2024, in connection with the Merger, Public ANEW entered

into a convertible promissory note that bore an interest of 10 % and Securities Purchase Agreement (“SPA”) with certain accredited

investors (the “Redwoods PIPE Investors”) for an aggregate purchase price of up to $ 2,000,000 (the “Redwoods PIPE

Financing”), which included 750,000 bonus shares of common stock.

Upon the closing of the Redwoods PIPE Financing (funded

and closed in connection with the closing of the Merger on June 21, 2024), which totaled $ 1,950,000 , of which $ 1,768,661

was used by the Company to settle transaction costs.

On March 4, 2024, in connection with the Merger,

Public ANEW entered into a convertible promissory note that bore an interest of 10 % and Securities Purchase Agreement (“SPA”)

with certain accredited investors (the “Redwoods PIPE Investors”) for an aggregate purchase price of up to $ 2,000,000

(the “Redwoods PIPE Financing”), which included 750,000 bonus shares of common stock.

Upon the closing of the Redwoods

PIPE Financing (funded and closed in connection with the closing of the Merger on June 21, 2024), which totaled $ 1,950,000 ,

of which $ 1,768,661 was used by the Company to settle transaction costs.

The Company received approximately $ 181,339 in net cash proceeds.

The note and related

interest were converted into the Company’s common shares and fully settled as of September 30, 2024.

The outstanding principal balance

as of March 31, 2025 and December 31, 2024 was $ 0 , respectively.

The note and related interest were converted into the Company’s common shares and fully settled as of September 30, 2024.

The outstanding

principal balance as of June 30, 2025 and December 31, 2024 was $ 0 , respectively.

ANEW PIPE Investors Convertible Promissory

On April 22, 2024, prior to the closing of the Business Combination

Agreement, ANEW Medical (Wyoming) entered into a convertible promissory note that bore an interest of 10 % and Securities Purchase Agreement

(“SPA”) with certain accredited investors (the “ANEW PIPE Investors”) for an aggregate purchase price of

up to $ 2,000,000 (the “ANEW PIPE Financing”), which included 900,000 bonus shares of common stock.

On April 22, 2024, prior to the closing of the

Business Combination Agreement, ANEW Medical (Wyoming) entered into a convertible promissory note that bore an interest of 10 % and Securities

Purchase Agreement (“SPA”) with certain accredited investors (the “ANEW PIPE Investors”) for an aggregate purchase

price of up to $ 2,000,000 (the “ANEW PIPE Financing”), which included 900,000 bonus shares of common stock.

Upon the closing of the

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and fully settled as of September 30, 2024.

The outstanding principal balance as of March 31, 2025 and December 31, 2024 was $ 0 , respectively.

Meteora Agreement

On June 13, 2024, RWOD and Klotho entered into

a forward purchase agreement with (i) Meteora Capital Partners, LP (“MCP”), (ii) Meteora Select Trading

Opportunities Master, LP (“MSTO”), and (iii) Meteora Strategic Capital, LLC (“MSC” and, collectively

with MCP and MSTO, the “Seller”) (the “Forward Purchase Agreement”).

Redwoods is the holder of the asset and Sponsor

and is also a counterparty to Klotho.

Upon Closing of the merger on June 21, 2024 and on September 30, 2024, the value of the contract

was $ 0 as the contract created no receivable or obligation for the Company.

On September 19, 2024, the Company modified the settlement

amount price of the contract to $ 2.00 and allowed the shares held with Meteora to be sold at Meteora’s sole discretion, with the

reset price subject to weekly changes.

Meteora sold and terminated on behalf of the Company 100,000 shares at a reset price of $ 0.4610 ,

for a total proceeds to Klotho in the amount of $ 46,100 .

The outstanding principal balance as of June 30, 2025 and December 31, 2024 was $ 0 , respectively.

Austria Capital LLC Convertible Promissory

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note is December 4, 2025.

The note has an original issue discount of $ 200,000 and deferred financing costs related to legal fees of $ 73,000 .

In addition, the note offered the investor an equity inducement of two million shares, which were issued to the Investor and valued at

The total of the original issue discount, deferred financing costs and equity inducement, exceeded the principal balance by

approximately $ 51,000 , which was expensed as an interest expense on the condensed consolidated statements of operations.

Total amortization

of these costs recognized as contra-liabilities to be presented net with the principal liability on the condensed consolidated balance

sheets was $ 100,000 at December 31, 2024.

The net liability as of March 31, 2025 and December 31, 2024 was approximately $ 400,000 and

$ 100,000 , respectively.

The note bears no interest, has a $ 200,000 original

issuance discount, is an unsecured obligation of the Company and will rank equal in right of payment with the Company’s existing

and future unsecured indebtedness.

The note bears no interest, has an original issue discount of $ 200,000 and deferred financing costs related

to legal fees of $ 73,000 .

In addition, the note offered the investor an equity inducement of two million shares, which were issued to

the Investor and valued at $ 978,000 .

The total of the original issue discount, deferred financing costs and equity inducement, exceeded

the principal balance by approximately $ 51,000 , which was expensed as an interest expense on the condensed consolidated statements of

Total amortization of these costs recognized as contra-liabilities to be presented net with the principal liability on the

condensed consolidated balance sheets was $ 100,000 at December 31, 2024.

At any time after the approval by the Company’s

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Such shares were issued in reliance upon Section 4(a)(2) of the Securities Act in a transaction not involving any public

The note was paid off in full as of June 30, 2025

and net liability as of June 30, 2025 and December 31, 2024 was approximately $ 0 and $ 100,000 , respectively.

Red Road Holdings Promissory Note

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The net liability

presented on the condensed consolidated balance sheet was $ 181,722 as of March 31, 2024 as a result of amortization of $ 17,515 recognized

in interest expense on the condensed consolidated statement of operations for the year ended March 31, 2025.

The net liability presented

on the condensed consolidated balance sheet was $ 199,237 as of December 31, 2024 as a result of amortization of $ 4,087 recognized in interest

expense on the condensed consolidated statement of operations for the year ended December 31, 2024.

presented on the condensed consolidated balance sheet was $ 181,722 as of June 30, 2024 as a result of amortization of $ 17,515 recognized

in interest expense on the condensed consolidated statement of operations for the year ended June 30, 2025.

As of June 30, 2025, the net

liability presented on the condensed consolidated balance sheet was $ 0 as the note was paid off in full, including interest expense composed

of $ 21,784 interest, $ 25,040 original issue discount, and related legal fees of $ 6,500 .

On January 3, 2025, the Company signed a loan

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The note is convertible to shares in the event of default.

The net liability presented on the condensed

consolidated balance sheet was $ 127,593 as of March 31, 2025 as a result of amortization of $ 10,122 recognized in interest expense on

the condensed consolidated statement of operations for the period ended March 31, 2025.

As of June 30, 2025, the net liability presented

on the condensed consolidated balance sheet was $ 0 as the note was paid off in full, including interest expense composed of $ 14,755 interest,

$ 16,960 original issue discount, and related legal fees of $ 6,000 .

On April 4, 2025, the Company signed a loan agreement

with Red Road Holdings in the amount of $ 106,534 , including guaranteed interest of $ 11,414 .

In connection with the note issuance, an original

issue discount of $ 13,120 was recognized.

as well as deferred financing costs related to legal fees of $ 7,000 .

The promissory note is

due on January 30, 2026.

The note is convertible to shares in the event of default.

As of June 30, 2025, the net liability presented on

the condensed consolidated balance sheet was $ 0 as the note was paid off in full, including interest expense composed of $ 11,414 interest,

$ 13,120 original issue discount, and related legal fees of $ 7,000 .

3i LP Institutional Investor Securities Purchase

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to the terms and conditions set forth in the Purchase Agreement.

On the Closing Date, a closing was held for the

purchase by the Investor of the first Note in the principal amount of $ 1,086,957 (the “First Note”) and the first Warrant

(the “First Warrant”) to purchase up to 2,000,000 shares of Common Stock, for an aggregate purchase price of $ 1,000,000 .

Upon effectiveness of the registration rights agreement (the “Registration

Rights Agreement”) executed by the Company and the Investor on the Closing Date, the Company filed a registration statement with

the Securities and Exchange Commission (“SEC”) to register the shares of Common Stock issuable to the Investor upon any conversion

of the Notes or exercise of the Warrants, within 15 days of the Closing Date.

Pursuant to the Purchase Agreement, upon the registration

statement being declared effective by the SEC on February 10, 2025, the Investor purchased a second Note in the principal amount of $ 1,086,957

and a second Warrant exercisable for up to an aggregate of 2,000,000 shares of Common Stock, for an aggregate purchase price of $ 1,000,000

on February 13, 2025.

The Notes mature on the anniversary of their date

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repayment of all outstanding principal such as certain events of bankruptcy, insolvency and reorganization involving the Company.

The Warrants expire five years from their respective

dates of issuance.

The Warrants are exercisable, at the option of the holder, at any time, for up to an aggregate of 4,000,000 shares

of Common Stock of the Company at an exercise price equal to $ 0.50 , subject to adjustment for any stock splits, stock dividends, recapitalizations,

and similar events.

The Warrants provide for cashless exercise under certain circumstances.

The Warrants contain the same Maximum Percentage

restrictions on exercise.

Upon effectiveness of the registration rights

agreement (the “Registration Rights Agreement”) executed by the Company and the Investor on the Closing Date, the Company

filed a registration statement with the Securities and Exchange Commission (“SEC”) to register the shares of Common Stock

issuable to the Investor upon any conversion of the Notes or exercise of the Warrants, within 15 days of the Closing Date.

the Purchase Agreement, upon the registration statement being declared effective by the SEC on February 10, 2025, the Investor purchased

a second Note in the principal amount of $ 1,086,957 and a second Warrant exercisable for up to an aggregate of 2,000,000 shares of Common

Stock, for an aggregate purchase price of $ 1,000,000 on February 13, 2025.

During the quarter ended March 31, 2025, investors

converted convertible promissory notes related to 3i totaling $ 348,913 , including $ 326,087 of principal and $ 22,826 related to interest

and make whole, through the issuance of 1,429,717 shares of common stock that were issued and outstanding as of March 31, 2025.

The Warrants expire five years from their respective dates of issuance.

The Warrants were exercisable, at the option of the holder, at any time, for up to an aggregate of 4,000,000 shares of Common Stock of

the Company at an exercise price equal to $ 0.50 , subject to adjustment for any stock splits, stock dividends, recapitalizations, and similar

On April 30, 2025, the Company made installment

payments in cash totaling $ 232,608 on both 3i Notes or $ 116,304 for each 3i note, including principal, interest and make whole.

was paid off in full as of June 30, 2025 and net liability as of June 30, 2025 and December 31, 2024 was approximately $ 0 , respectively.

As of June 30, 2025, investors converted convertible promissory notes

related to Austria Capital totaling $ 650,000 through the issuance of 2,600,000 shares of common stock that were issued and outstanding

as of June 30, 2025.

As of June 30, 2025, investors converted convertible promissory notes related to 3i totaling $ 881,085 through the

issuance of 5,413,474 shares of common stock that were issued and outstanding as of June 30, 2025.

During 2024, investors converted convertible promissory

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The promissory note accrued interest at a one-time interest fee of $ 2,460 , which was paid off as of September

The unpaid principal balance was $ 0 and $ 31,000 at March 31, 2025 and December 31, 2024, respectively.

At March 31, 2025 and December 31, 2024, the aggregate

The unpaid principal balance was $ 0 and $ 31,000 at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025 and December 31, 2024, the aggregate

related party payable was $0 and $ 31,000 , respectively.

NOTE 9 — STOCKHOLDER’S EQUITY

On June 21, 2024, the Business Combination was completed.

The transaction

was accounted as a reverse recapitalization in accordance with GAAP.

Under this method of accounting, Redwoods was treated as the

“acquired” company for financial reporting purposes.

Accordingly, for accounting purposes, the financial statements of the

Combined Company represent a continuation of the financial statements of Klotho with the Transactions treated as the equivalent of Klotho

issuing shares for the net assets of Redwoods, accompanied by a recapitalization.

Accordingly, for accounting purposes, the Merger was

treated as the equivalent of the Company issuing shares for the net assets of Redwoods, accompanied by a recapitalization.

The net assets of Redwoods were stated at historical cost with no goodwill or other intangible assets recorded.

See “NOTE 1 — Organization

and Business Description” for detail.

On June 21, 2024, the Business Combination was

The transaction was accounted as a reverse recapitalization in accordance with GAAP.

Under this method of accounting,

Redwoods was treated as the “acquired” company for financial reporting purposes.

Accordingly, for accounting purposes, the

financial statements of the Combined Company represent a continuation of the financial statements of Klotho with the Transactions treated

as the equivalent of Klotho issuing shares for the net assets of Redwoods, accompanied by a recapitalization.

Accordingly, for accounting

purposes, the Merger was treated as the equivalent of the Company issuing shares for the net assets of Redwoods,

accompanied by a recapitalization.

The net assets of Redwoods were stated at historical cost with no goodwill or other intangible

assets recorded.

See “NOTE 1 — Organization and Business Description” for detail.

Equity Incentive Plan

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executive officers and from time to time may grant equity incentive awards to them.

During the three months ended March 31, 2025,

the Company granted 180,000 options and 0 shares as part of the Equity Incentive Plan and the share-based compensation expense totaled

$ 495,500 related to options grants and vesting.

During the three months ended June 30, 2025, the Company initiated

a warrant exercise inducement program, reducing the exercise price from $ 3.49 to $ 1.35 for certain outstanding warrants.

The Company accounted

for the inducement as a modification of the original warrants in accordance with ASC 505-10 - Equity.

The incremental fair value was recorded

as a deemed dividend of $ 0.3 million in accumulated deficit on the condensed consolidated balance sheets.

During the three months ended

June 30, 2025, holders of common stock warrants exercised a total of 11.0 million warrants for gross proceeds of $ 11.4 million.

Austria Note Conversion

During the three months ended June 30, 2025, $ 650,000 of principal

related to the Austria Capital LLC Convertible Promissory Note was converted into 2,600,000 shares of common stock at a conversion price

The remainder of the note in the amount of $ 550,000 was settled in cash.

Therefore, the Company de-recognized the remaining

unamortized original issue discount of $ 85,554 and deferred financing costs of $ 438,471 , which were recognized in interest expense on

the condensed consolidated statements of operations.

3i Note Conversion

During the six months ended June 30, 2025, $ 823,444 of principal and

$ 57,641 of interest and make whole related to 3i convertible notes was converted into 5,413,474 shares of common stock at conversion prices

ranging from $ 0.12 to $ 0.25 .

Investor Share Purchase

On June 5, 2025, the Company entered into a securities purchase agreement

an accredited investor pursuant to Regulation D of the Securities Act of 1933, as amended.

Under the terms of the agreement, the Company

issued 6,250,000 shares of its common stock at a purchase price of $ 0.08 per share, for total gross proceeds of $ 500,000 .

were allocated to common stock based upon their par value of the common stock and the remainder in recorded to additional paid in capital

on the condensed consolidated balance sheets.

Preferred B Shares

On June 9, 2025, the Company conducted a private

offering and issued 500 preferred B shares at $ 0.0001 par value per share for a total of $ 500,000 .

The 500 preferred shares are convertible

into 6,250,000 common shares.

Meteora Agreement

On June 13, 2024, RWOD and Klotho entered into a forward purchase agreement

with (i) Meteora Capital Partners, LP (“MCP”), (ii) Meteora Select Trading Opportunities Master, LP (“MSTO”),

and (iii) Meteora Strategic Capital, LLC (“MSC” and, collectively with MCP and MSTO, the “Seller”) (the

“Forward Purchase Agreement”).

Redwoods is the holder of the asset and Sponsor and is also a counterparty to Klotho.

Closing of the merger on June 21, 2024 and on September 30, 2024, the value of the contract was $ 0 as the contract created no receivable

or obligation for the Company.

On September 19, 2024, the Company modified the settlement amount price of the contract to $ 2.00 and allowed

the shares held with Meteora to be sold at Meteora’s sole discretion, with the reset price subject to weekly changes.

quarter ending March 31, 2025, Meteora sold and terminated on behalf of the Company 100,000 shares at a reset price of $ 0.4610 , for total

proceeds to Klotho in the amount of $ 46,100 .

On May 15, 2025, Meteora terminated additional 550,214 shares at a reset price of $ 0.1717

for total proceeds of $ 94,472 , thereby reducing the number of shares per the agreement to 10,000 shares remaining.

NOTE 10 — COMMITMENTS AND CONTINGENCIES

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other claims will have a material effect on the Company’s business, financial condition, results of operations or cash flows.

Acquisition of SB Security Holdings, LLC

Termination of acquisition agreement of SB

Security Holdings, LLC

On March 26, 2025, the Company entered into a

7 unchanged sentences

including mutual agreement as to the legal transaction structure, approval by the Company’s stockholders, and Nasdaq approval.

June 13, 2025, the Company terminated the SEA.

NASDAQ Deficiencies

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10 consecutive business days.

On October 15, 2024, the Company

received a delinquency notification letter (the “Notice”) from Nasdaq due to the Company’s non-compliance with Nasdaq

Listing Rule 5450(a)(1).

The Notice cited the fact that the bid price of the Company’s common stock had closed at less than $ 1 per

share over the previous 30 consecutive business days.

On March 31, 2025, subsequent to a Nasdaq Listing

On October 15, 2024, the Company received a delinquency

notification letter (the “Notice”) from Nasdaq due to the Company’s non-compliance with Nasdaq Listing Rule 5450(a)(1).

The Notice cited the fact that the bid price of the Company’s common stock had closed at less than $ 1 per share over the previous

30 consecutive business days.

On June 30, 2025, subsequent to a Nasdaq Listing

Qualifications Hearing conducted on March 28, 2025, the Company received notice from the Nasdaq Listing Qualifications Panel that the

Panel had granted the Company’s request to continue its listing on The Nasdaq Stock Market (“Nasdaq” or the “Exchange”)

subject to completing the Acquisition of SB Security Holdings, LLC no later than August 13, 2025.

subject to becoming compliant by August 13, 2025.

The Company received a letter of compliance on July 14, 2025.

NOTE 11 — SEGMENT INFORMATION

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are used in assessing performance of the segment.

The following table is representative of the significant expense categories

regularly provided to the CODM when managing the Company’s single reporting segment.

A reconciliation to the consolidated net loss

for the period ended March 31, 2025 and 2024 is included at the bottom of the table below.

For the Three Months Ended March 31,

The following table is representative of the significant

expense categories regularly provided to the CODM when managing the Company’s single reporting segment.

A reconciliation to the

consolidated net loss for the periods ended June 30, 2025 and 2024 is included at the bottom of the table below.

For the Three Months Ended

For the Six Months Ended

Significant segment expenses

General and administrative (1)

Research and development

Professional fees - Licenses and Patents

1 unchanged sentence

Share-based compensation expense

Interest expense

Interest expense (income)

Other segment items

4 unchanged sentences

1) Excluding share-based compensation expense

NOTE 12 — SUBSEQUENT

NOTE 12 — SUBSEQUENT EVENTS

The Company has evaluated subsequent events pursuant

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that the following subsequent event exists:

Red Road Holdings Promissory Note

On April 4, 2025, the Company signed a loan agreement

with Red Road Holdings in the amount of $ 106,534 , including guaranteed interest of $ 11,414 .

In connection with the note issuance, an original

issue discount of $ 13,120 was recognized.

The promissory note is due on January 30, 2026 .

The note is convertible to shares in the event

3i Installments

On April 30, 2025, the Company made installment payments totaling $ 232,608 ,

including principal, interest and make whole, on the 3i Notes.

On May 12, 2025, investors converted convertible promissory notes related

to 3i totaling $ 232,608 , including $ 217,392 of principal and $ 15,218 related to interest and make whole, through the issuance of 1,653,602

shares of common stock that were issued and outstanding as of May 12, 2025.

On May 14, 2025, investors converted convertible promissory

notes related to 3i totaling $ 183,259 , including $ 171,270 of principal and $ 11,989 related to interest and make whole, through the issuance

of 1,503,354 shares of common stock that were issued and outstanding as of May 14, 2025.

Nasdaq Deficiencies

On April 15, 2025, the Company received written

notice from Nasdaq stating that the Company had not regained compliance with Nasdaq Listing Rule 5450(a)(1)

for minimum bid price of $ 1 .

On April 22, 2025, the Company provided a written update to the Nasdaq Hearings Panel reiterating its plan

for Bid Price Rule compliance by August 13, 2025.

On July 3, 2025, the U.S.

Food and Drug Administration (FDA) granted

Orphan Drug Designation to the company’s novel secreted-Klotho (s-KL) promoter, gene and delivery system (KLTO-202, or s-KL-AAV.myo)

for the treatment of ALS.

The Orphan Drug Designation provides certain incentives to the Company, such as tax credits, toward the cost

of human clinical trials and a waiver for the payment of the GDUFA User Fee for market applications.

Additionally, Orphan Drug Designation

of the product provides developers with seven years of US market exclusivity and independent from the Company’s intellectual property

On July 3, 2025, the Company entered into a sales agreement with A.G.P./Alliance

Global Partners (“A.G.P.”) relating to the sale of newly issued shares of the Company’s common stock.

In accordance

with the terms of the sales agreement, the Company may offer and sell shares of its common stock having an aggregate offering price of

up to $ 50,000,000 from time to time through A.G.P., acting as the Company’s sales agent or principal.

The Company intends to use

the net proceeds from the offering for working capital and for general corporate purposes.

On July 7, 2025, the Company filed a Form S-3 Registration Statement

with the U.S.

Securities Exchange Commission (“SEC”) that allows the Company to offer shares of common stock, preferred stock,

warrants to purchase common stock or preferred stock, and/or units to purchase any of such securities, either individually or in combination

with other securities described in this prospectus, in one or more offerings from time to time, with a total value of up to $ 100,000,000 .

The Form S-3 was declared effective on July 25, 2025.

On July 8, 2025, the Board of Directors determined that the Company

had met the criteria set forth in the Business Combination Agreement for the release of 2,000,000 contingent shares to the pre-closing

stockholders of ANEW Medical.

The 2,000,000 shares were issued on August 5, 2025.

In addition, the Board of Directors approved the issuance

of 408,691 from in the Company’s Equity Incentive Plan to Jeffrey LeBlanc, the Company’s CFO.

On July 14, 2025, the Nasdaq Hearings Panel (the

“Panel”) issued a letter to the Company that the Panel finds the Company in compliance with Listing Rules 5550(a)(1) and 5550(b)(1),

the “Bid Price” and “Equity Rules,” respectively.

On July 16, 2025, the Company issued a press release announcing

that the Company regained compliance with the Nasdaq listing requirements.

In addition, on July 14.

2025, Nasdaq approved the Company’s

application to “phase down” the listing of its common stock and warrants from the Nasdaq Global Market to the Nasdaq Capital

The Company’s common stock will continue to trade under the symbol “KLTO” and the Company’s warrants will

continue to trade under the symbol “KLTOW.”

On July 21, 2025, the Company signed a one-year lease in the amount

of $ 8,400 for an office space in Charlotte, NC.

On July 28, 2025, the Company filed with the SEC a Supplemental Prospectus

under the Form S-3 Registration Statement to register for resale an aggregate 12,500,000 Shares of Common Stock of the Company, which

consists of 6,250,000 shares of Common Stock previously sold to two investors in a transaction exempt from the registration requirements

of the Securities Act and 6,250,000 shares of Common Stock issuable upon the conversion of shares of the Company’s Series B Preferred

Stock sold to an investor in a transaction exempt from the registration requirements of the Securities Act.

On July 28, 2025, the Company filed with the SEC a Supplemental Prospectus

under the Form S-3 Registration Statement to register for the offer and sell shares of up to $ 50,000,000 in common stock, from time to

time, through A.G.P., acting as the Company’s sales agent or principal.

The sales of the common stock, if any, under the prospectus

supplement will be made at market prices by any method deemed to be an “at the market offering.”

On August 6, 2025, Klotho Neurosciences, Inc.

(the “Company”)

entered into a Letter Agreement (“Agreement”) with AAVnerGene Inc.

(“AAVnerGene”) for the manufacturing and development

of its KLTO-202 gene therapy candidate using the AAVnerGene platform technology.

AAVnerGene is an innovation-driven biotech renowned for

its transformative technologies in adeno-associated viruses (AAV) manufacturing and tissue-targeted delivery.

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 1. Financial Statements