What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-03-30 compared with 2025-03-28 · 721 added, 1063 removed, 354 unchanged (83% of the section changed)

ITEM 9A — CONTROLS

AND PROCEDURES

ITEM 9A — CONTROLS AND PROCEDURES

Disclosure Controls and Procedures:

controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under

the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms

and (ii) accumulated and communicated to our management, including our principal executive and principal financial officer, as appropriate

to allow timely decisions regarding required disclosures.

Because of its inherent limitations, internal control over financial reporting

may not prevent or detect misstatements.

Therefore, even those systems determined to be effective can provide only reasonable assurance

with respect to financial statement preparation and presentation.

Also, projections of any evaluation of effectiveness to future periods

are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the

policies or procedures may deteriorate.

Our management, with the participation of the individual who serves as our principal executive

and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules

13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of December 31, 2024.

Based on this

evaluation, that officer concluded that our disclosure controls and procedures were effective as of that date.

Management’s Annual Report on Internal

Control over Financial Reporting:

The management of the Company is responsible for establishing and maintaining adequate internal

control over financial reporting.

Our internal control over financial reporting is designed to provide reasonable assurance regarding

the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally

accepted accounting principles.

We conducted an evaluation of the effectiveness of the internal controls over financial reporting based

on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway

This evaluation included a review of the documentation of controls, evaluation of the design effectiveness of controls, testing

the operating effectiveness of the controls and a conclusion on this evaluation.

Also, projections of any evaluation of effectiveness

to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of

compliance with the policies or procedures may deteriorate.

This Annual Report does not include an attestation report from our independent

registered public accounting firm regarding internal control over financial reporting.

Management’s internal control report was

not subject to annual or quarterly attestation by our independent registered public accounting firm pursuant to rules of the Securities

and Exchange Commission that permit the Company to provide only management’s report.

Changes in Internal Controls over Financial

Our principal executive and principal financial officer and our Director of Finance and Administration periodically evaluate

any change in internal control over financial reporting which has occurred during the prior fiscal quarter.

We have concluded that there

was no change in our internal control over financial reporting that occurred during the quarter ended December 31, 2024 that has materially

affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B — OTHER

ITEM 9C — DISCLOSURE

REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our principal executive and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management, with the participation of the individuals who serves as our principal executive and principal financial officers, evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of December 31, 2025.

Based on this evaluation, those officers concluded that our disclosure controls and procedures were effective as of that date.

Management ’ s Annual Report on Internal Control over Financial Reporting:

Our management is responsible for establishing and maintaining adequate internal control over financial reporting.

Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

We conducted an evaluation of the effectiveness of the internal controls over financial reporting based on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

This evaluation included a review of the documentation of controls, evaluation of the design effectiveness of controls, testing the operating effectiveness of the controls and a conclusion on this evaluation.

This Annual Report does not include an attestation report from our independent registered public accounting firm regarding internal control over financial reporting.

Management’s internal control report was not subject to annual or quarterly attestation by our independent registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit the Company to provide only management’s report.

Changes in Internal Controls over Financial Reporting:

Our principal executive and principal financial officer and our Director of Finance and Administration periodically evaluate any change in internal control over financial reporting which has occurred during the prior fiscal quarter.

We have concluded that there was no change in our internal control over financial reporting that occurred during the quarter ended December 31, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ImmuCell Corporation

ITEM 9B — OTHER INFORMATION

ITEM 9C — DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not Applicable

ITEM 10 — DIRECTORS,

EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Executive Officers of the

Our executive officers as of March 21, 2025 were

BRIGHAM (Age:

64, Officer since

1991, Director since 1999) was appointed to serve as President and Chief Executive Officer in February 2000, while maintaining the titles

of Treasurer and Secretary, and was appointed to serve as a Director of the Company in March 1999.

He previously had been elected Vice

President of the Company in December 1998 and had served as Chief Financial Officer since October 1991.

He has served as Secretary since

December 1995 and as Treasurer since October 1991.

Prior to that, he served as Director of Finance and Administration since originally

joining the Company in September 1989.

Brigham served as a member of the Board of Directors of the United Way of York County from

2012 to 2019, serving as its Treasurer until June 2016 and as Chair of the Board of Directors for one year and as a member of its Executive

Brigham served as the Treasurer of the Board of Trustees of the Kennebunk Free Library from 2005 to 2011.

the Finance Committee of the library in 2012.

Prior to joining the Company, he was employed as an audit manager for the public accounting

firm of Ernst & Young.

Brigham earned his Masters in Business Administration from New York University in 1989 and a Bachelor of

Arts degree (with a double major in Economics and Spanish) from Trinity College in Hartford, Connecticut in 1983.

BOBBI JO BROCKMANN (Age:

48, Officer since

February 2015, Director since January 2018) served as a Director of the Company from March 2017 to September 2017 and from January 2018

to the present.

She was promoted to Vice President of Sales and Marketing in February 2015.

She joined the Company as Director of Sales

and Marketing in January 2010.

Prior to that, she had been employed as Director of Sales since May 2008 and Sales Manager from February

2004 to April 2008 at APC, Inc.

of Ankeny, Iowa, a developer and marketer of functional protein products for animal health and nutrition.

Prior to that, she held other sales and marketing positions at APC, W & G Marketing Company, Inc.

of Ames, Iowa, The Council

for Agricultural Science and Technology of Ames, Iowa and Meyocks Group Advertising of West Des Moines, Iowa after graduating from Iowa

State University.

Information with respect to our directors is incorporated

herein by reference to the section of our 2025 Proxy Statement titled “Election of the Board of Directors”, which we intend

to file with the Securities and Exchange Commission within 120 days after December 31, 2024.

There is no family relationship between any

director, executive officer, or person nominated or chosen by the Company to become a director or executive officer.

ITEM 11 — EXECUTIVE

Information regarding compensation paid to our executive

officers is incorporated herein by reference to the section of our 2025 Proxy Statement titled “Executive Officer Compensation”,

which we intend to file with the Securities and Exchange Commission within 120 days after December 31, 2024.

ITEM 12 — SECURITY

OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information regarding ownership of our common stock

by certain owners and management is incorporated herein by reference to the section of our 2025 Proxy Statement titled “Security

Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”, which we intend to file with the Securities

and Exchange Commission within 120 days after December 31, 2024.

ITEM 13 — CERTAIN

RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Information regarding certain relationships and

related transactions and director independence is incorporated herein by reference to the section of our 2025 Proxy Statement titled “Certain

Relationships and Related Transactions and Director Independence”, which we intend to file with the Securities and Exchange Commission

within 120 days after December 31, 2024.

ITEM 14 — PRINCIPAL

ACCOUNTANT FEES AND SERVICES

Information regarding our principal accounting fees

and services is incorporated by reference to the section of our 2025 Proxy Statement titled “Principal Accounting Fees and Services”,

which we intend to file with the Securities and Exchange Commission within 120 days after December 31, 2024.

ITEM 15 — EXHIBITS

AND FINANCIAL STATEMENT SCHEDULES

ITEM 10 — DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item with respect to directors, executive officers, and compliance with Section 16 (a) of the Exchange Act, our code of ethics and corporate governance is omitted from this Annual Report on Form 10 -K and, pursuant to Regulation 14A of the Exchange Act, is incorporated herein by reference from the sections entitled “Election of the Board of Directors,” “The Board of Directors and Its Committees,” “Code of Business Conduct and Ethics,” and “Section 16 (a) Beneficial Ownership Reporting Compliance” in the Company’s definitive Proxy Statement with respect to its 2026 Annual Meeting, which we intend to file with the SEC within 120 days after December 31, 2025.

We have adopted an insider trading policy, which we refer to as the Insider Trading Policy, and related procedures, which govern the purchase, sale and other dispositions of our securities by our directors, officers, employees and other covered persons, as well as by the Company itself.

We believe that our Insider Trading Policy and related procedures are reasonably designed to promote compliance with applicable insider trading laws, rules and regulations and the Nasdaq Stock Market listing standards applicable to us.

The Insider Trading Policy prohibits our directors, officers, employees and other covered persons from trading in our securities while in possession of material non-public information about us.

This Policy also generally prohibits disclosure of material non-public information about us to others, with some limited exceptions.

The foregoing summary of the Insider Trading Policy does not purport to be complete and is qualified in its entirety by reference to the full text of the Insider Trading Policy filed as Exhibit 19 to this Annual Report on Form 10 -K.

ITEM 11 — EXECUTIVE COMPENSATION

Information regarding compensation paid to our executive officers is incorporated herein by reference to the section entitled “Executive Compensation”, in the Company's definitive Proxy Statement, which we intend to file with the SEC within 120 days after December 31, 2025 .

ITEM 12 — SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information regarding ownership of our common stock by certain owners and management is incorporated herein by reference to the section of our 2026 Proxy Statement titled “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”, which we intend to file with the Securities and Exchange Commission within 120 days after December 31, 2025.

ITEM 13 — CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Information regarding certain relationships and related transactions and director independence is incorporated herein by reference to the section of our 2026 Proxy Statement titled “Certain Relationships and Related Transactions and Director Independence”, which we intend to file with the SEC within 120 days after December 31, 2025.

ITEM 14 — PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information regarding our principal accounting fees and services is incorporated by reference to the section of our 2026 Proxy Statement titled “Principal Accounting Fees and Services”, which we intend to file with the SEC within 120 days after December 31, 2025.

ITEM 15 — EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

At the Market Agreement between the Company and Craig-Hallum Capital Group LLC dated as of April 8, 2024 (incorporated by reference to Exhibit 1.1 of the Company’s Current Report on Form 8-K Filed on April 9, 2024).

5 unchanged sentences

Certificate of Amendment to the Company’s Certificate of Incorporation effective June 18, 2018 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on June 18, 2018).

ImmuCell Corporation

Certificate of Amendment to the Company’s Certificate of Incorporation effective June 11, 2020 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on June 11, 2020).

7 unchanged sentences

Amendment to the 2017 Stock Option and Incentive Plan of the Company (incorporated by reference to Exhibit 10.7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022).

ImmuCell Corporation

2025 Stock Option and Incentive Plan, as approved by the Board of Directors on November 7, 2025 and revised on March 26, 2026.

Form of Incentive Stock Option Agreement for 2025 Plan.

Form of Director Stock Option for 2025 Plan.

Amended and Restated Separation and Deferred Compensation Agreement between the Company and Michael F.

1 unchanged sentence

Fourth Amended and Restated Incentive Compensation Agreement between the Company and Bobbi Jo Brockmann dated as of March 27, 2024 (incorporated by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023).

Employment and Separation Agreement between the Company and Elizabeth L.

Williams dated as of December 6, 2024 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed December 9, 2024).

Incentive Compensation Agreement between the Company and Michael F.

1 unchanged sentence

Amended and Restated Incentive Compensation and Severance Agreement between the Company and Bobbi Jo Brockmann dated as of March 27, 2025.

Incentive Compensation Agreement between the Company and Timothy C.

Fiori dated as of April 4, 2025

Employment Agreement between the Company and Olivier te Boekhorst dated as of September 29, 2025

Confidential Information, Inventions and Noncompete Agreement between the Company and Olivier te Boekhorst, signed September 29, 2025 and effective upon commencement of employment

Development Services and Commercial Supply Agreement between the Company and Norbrook Laboratories Limited dated as of September 5, 2019 (incorporated by reference to Exhibit 99.2 of the Company’s Current Report on Form 8-K filed on September 11, 2019).

21 unchanged sentences

Term Note for $2,000,000 executed by ImmuCell Corporation in favor of Gorham Savings Bank dated July 17, 2023 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on July 21, 2023).

Loan Agreement, by and between ImmuCell Corporation and Gorham Savings Bank dated July 17, 2023 (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on July 21, 2023).

Economic Recovery/SSBCI Program Loan Promissory Note for $1,000,000 executed by ImmuCell Corporation in favor of the Finance Authority of Maine dated July 17, 2023 (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K filed on July 21, 2023).

Economic Recovery Loan Program Loan Agreement, by and between ImmuCell Corporation and the Finance Authority of Maine dated July 17, 2023 (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K filed on July 21, 2023).

Consent and First Amendment to Economic Recovery Loan Program Loan Agreement, by and between ImmuCell Corporation and the Finance Authority of Maine dated as of April 8, 2024 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on April 9, 2024).

Promissory Note executed by the Company in favor of Maine Community Bank dated as of August 7, 2025

Allonge to and Amendment of Line of Credit Loan between the Company and Maine Community Bank dated August 20, 2025

Fourth Amendment of Indenture of Lease for Premises Located in Portland, Maine between the Company and TVP, LLC dated as of June 11, 2024 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on June 14, 2024).

1 unchanged sentence

Code of Business Conduct and Ethics (incorporated by reference to Exhibit 14 of the Company’s Current Report on Form 8-K filed on March 20, 2014).

Insider Trading Policy of the Company adopted as of December 11, 2024.

Insider Trading Policy of the Company adopted as of December 11, 2024 (incorporated by reference to Exhibit 19 to the Company's Annual Report on Form 10-K for the year ended December 31, 2024).

Consent of Independent Registered Public Accounting Firm.

Power of Attorney (incorporated by reference to the signature page of this Form 10-K).

Certification Pursuant to Rule 13a-14(a).

Certification Pursuant to Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Certification of the President and Chief Executive Officer Pursuant to Rule 13a-14(a).

Certification of the Chief Financial Officer the Pursuant to Rule 13a-14(a).

Certification of the President and Chief Executive Officer Pursuant to Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Certification of the Chief Financial Officer Pursuant to Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

ImmuCell Corporation Clawback Policy (incorporated by reference to Exhibit 97.1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023).

XBRL Instance Document-the instance document does not appear in

the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

XBRL Instance Document-the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Inline XBRL Taxonomy Extension Schema Document.

3 unchanged sentences

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File-the cover page interactive data file

does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Cover Page Interactive Data File-the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Management contract or compensatory plan or arrangement.

2 unchanged sentences

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of ImmuCell

To the Stockholders and the Board of Directors of ImmuCell Corporation

Opinion on the Financial Statements

We have audited the accompanying balance

sheets of ImmuCell Corporation (the “Company”) as of December 31, 2024 and 2023, and the related statements of operations,

stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively

referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects,

the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each

of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States

We have audited the accompanying balance sheets of ImmuCell Corporation (the “Company”) as of December 31, 2025 and 2024, and the related statements of operations, stockholders’ equity, and cash flows for the years ended December 31, 2025 and 2024, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the years ended December 31, 2025 and 2024, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”)

and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable

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

We conducted our audits in accordance

with the standards of the PCAOB.

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

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

The Company is not required to have, nor were

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

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

understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the

Company’s internal control over financial reporting.

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures

to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that

respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as

evaluating the overall presentation of the financial statements.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Critical Audit Matter

The critical audit matter communicated

below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated

to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved

our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way

our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing

a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) related to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of the critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing a separate opinion on the critical audit matters or on the accounts or disclosures to which it relates.

Valuation of Inventory

Description of the Matter

At December 31, 2024, the Company’s inventory was $7,112,623.

At December 31, 2025 and 2024, the Company’s inventory was $9,267,369 and $7,112,623, respectively.

As discussed in Note 2 of the financial statements, inventory is recorded at the lower of cost or net realizable value.

Auditing management’s valuation of inventory is complex and highly judgmental because of the estimates and assumptions used by management to determine the cost accounting and because of the variability of the cost per dose due to fluctuations in the biological yield achieved.

How We Addressed the Matter In Our Audit

The primary procedures we performed to address this critical audit matter included the following:

How We Addressed the Matter In Our Audit The primary procedures we performed to address this critical audit matter included the following:

We obtained an understanding of the cost accounting developed by management and the related assumptions and estimates used.

1 unchanged sentence

We evaluated the effect of the variability of the cost per dose on the inventory value by comparing the biological yield to historical results and by performing a sensitivity analysis of the potential range in inventory value within a corridor of historical results based on minimum and maximum outcomes for the biological yield.

Impairment and Salvage Value of Property, Plant and Equipment

Description of the Matter During December 2025, the Company made the decision to focus on its First Defense ® product line and pause further investment in Re-Tain ® manufacturing.

As a result, the Company evaluated certain property, plant and equipment previously associated with Re-Tain ® for impairment.

Based on management’s analysis, certain assets that the Company intends to refit for its First Defense ® product line were deemed to not be impaired, while other assets that were found to no longer have a future use or future cash flows other than from their disposal were written down to their estimated salvage value of $200,000.

As a result of this write down, the Company recognized a $2,667,100 impairment charge on property, plant and equipment during the year ended December 31, 2025.

Auditing management’s impairment evaluation of property, plant and equipment and the related estimates of salvage value are complex and highly judgmental because of the estimates and assumptions utilized by management in these determinations, including the expected future use of the property, plant and equipment based on management’s intentions as well as the expected salvage value to be obtained upon disposal.

How We Addressed the Matter In Our Audit The primary procedures we performed to address this critical audit matter included the following:

We obtained a detailed listing of all Re-Tain ® manufacturing assets and conducted interviews with personnel to gain an understanding of the purpose and retrofit capabilities of the significant assets as well as the Company’s future intentions for such assets.

We also held conversations with a third party who specializes in equipment sales to understand the Company’s ability to sell select equipment and reasonable proceeds to be expected from such disposal.

In addition, we tested and recalculated management’s impairment calculations conducted for impacted property, plant and equipment.

/s/ WIPFLI LLP

4 unchanged sentences

BALANCE SHEETS

of December 31,

As of December 31,

CURRENT ASSETS:

Cash and cash equivalents

$ 3,806,831 $ 3,758,232

Trade accounts receivable

3,419,009 3,771,133

9,267,369 7,112,623

Prepaid expenses and other current assets

451,673 400,762

Total current assets

16,944,882 15,042,750

Property, plant and equipment, net

21,074,694 25,349,019

Operating lease right-of-use asset

4,379,628 4,560,679

95,557 95,557

Intangible assets, net

37,686 33,368

$ 42,532,447 $ 45,100,477

LIABILITIES AND STOCKHOLDERS’ EQUITY

1 unchanged sentence

Current portion of debt obligations

$ 1,610,185 $ 1,497,619

Current portion of operating lease liability

85,489 432,072

Accounts payable and accrued expenses

2,282,583 2,482,522

Total current liabilities

3,978,257 4,412,213

LONG-TERM LIABILITIES:

Debt obligations, net of current portion

7,488,922 9,040,975

Operating lease liability, net of current portion

4,009,788 4,129,102

Total long-term liabilities

11,498,710 13,170,077

TOTAL LIABILITIES

CONTINGENT LIABILITIES AND COMMITMENTS (See Note 10)

15,476,967 17,582,290

COMMITMENTS AND CONTINGENCIES (See Note 10)

STOCKHOLDERS’ EQUITY:

Common stock, $ 0.10 par value per share, with 15,000,000 shares authorized and 9,105,622 and 9,042,392 shares issued and 9,045,851 and 8,979,091 shares outstanding as of December 31, 2025 and 2024, respectively

910,563 904,240

Additional paid-in capital

41,479,430 40,916,155

Accumulated deficit

( 15,203,753 ) ( 14,163,726 )

Treasury stock, at cost, 59,771 and 63,301 shares as of December 31, 2025 and 2024, respectively

( 130,760 ) ( 138,482 )

Treasury stock, at cost, 63,301 shares as of both December 31, 2024 and 2023

Total stockholders’ equity

27,055,480 27,518,187

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

The accompanying notes are an integral part

of these financial statements.

$ 42,532,447 $ 45,100,477

The accompanying notes are an integral part of these financial statements.

ImmuCell Corporation

STATEMENTS OF OPERATIONS

the Years Ended

During the Years Ended

Product sales

4 unchanged sentences

Operating expenses

NET OPERATING LOSS

( 1,640,159 )

( 5,748,078 )

NET OPERATING INCOME (LOSS)

Other expenses, net

LOSS BEFORE INCOME TAXES

( 2,146,573 )

( 5,769,971 )

Income tax expense

$ ( 2,156,629 )

$ ( 5,774,598 )

Basic weighted average common shares outstanding

2 unchanged sentences

Diluted net loss per share

The accompanying notes are an integral part

of these financial statements.

The accompanying notes are an integral part of these financial statements.

ImmuCell Corporation

1 unchanged sentence

Treasury Stock

paid-in capital

Accumulated Deficit

Total Stockholders’ Equity

Stockholders’

December 31, 2023

$ ( 6,232,499 )

$ ( 147,233 )

( 5,774,598 )

Exercise of stock options

Stock-based compensation

At-the-Market Offering of common stock, net of $291,834 of issuance fees

Share-based compensation

December 31, 2024

$ ( 12,007,097 )

$ ( 138,482 )

( 2,156,629 )

At-the-Market Offering of common stock, net of $ 291,834 of offering costs

Stock-based compensation

Exercise of stock options

At-the-Market Offering of common stock, net of $67,880 of issuance fees

Share-based compensation

December 31, 2025

$ ( 14,163,726 )

$ ( 138,482 )

The accompanying notes are an integral part

of these financial statements.

The accompanying notes are an integral part of these financial statements.

ImmuCell Corporation

STATEMENTS OF CASH FLOWS

the Years Ended

During the Years Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 2,156,629 )

$ ( 5,774,598 )

Adjustments to reconcile net loss to net cash provided by (used for) operating activities:

Adjustments to reconcile net loss to net cash provided by operating activities:

Amortization of intangible assets

Amortization of debt issuance costs and debt discounts

Stock-based compensation

Amortization and write-off of debt issuance costs and debt discounts

Share-based compensation

Loss on disposal of property, plant and equipment

Non-cash rent (benefit) expense

Impairment charge related to property, plant and equipment

Non-cash rent benefit

Trade accounts receivable

( 1,585,750 )

( 1,773,302 )

Prepaid expenses and other current assets

Accounts payable and accrued expenses

Net cash provided by (used for) operating activities

( 4,674,236 )

Net cash provided by operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property, plant and equipment

( 1,892,513 )

Proceeds from sale of property, plant and equipment

Net cash used for investing activities

( 1,890,039 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from debt issuance

Proceeds from line of credit

Borrowings on bank debt

Repayments on bank debt

Payments of debt issuance costs and debt discounts

Proceeds from At-The-Market Offering

Debt principal repayments

( 1,468,338 )

( 1,185,774 )

Line of credit repayments

( 2,000,000 )

Payments of debt issuance costs

Payments of debt discounts

Payments of equity issuance fees

Proceeds from exercise of stock options

Net cash provided by financing activities

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

( 4,812,821 )

Net cash (used for) provided by financing activities

NET INCREASE IN CASH AND CASH EQUIVALENTS

BEGINNING CASH AND CASH EQUIVALENTS

ENDING CASH AND CASH EQUIVALENTS

accompanying notes are an integral part of these financial statements.

The accompanying notes are an integral part of these financial statements.

ImmuCell Corporation

1 unchanged sentence

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

the Years Ended

During the Years Ended

CASH PAID FOR:

NON-CASH ACTIVITIES:

Change in capital expenditures included in accounts payable and accrued expenses

Change in payments of debt discounts included in accounts payable and accrued expenses

Operating lease right-of-use asset and operating lease liability

The accompanying notes are an integral part

of these financial statements.

Change in capital expenditures incurred, but not paid

Refinance of debt obligation

The accompanying notes are an integral part of these financial statements.

ImmuCell Corporation

Notes to Audited Financial Statements

BUSINESS OPERATIONS

ImmuCell Corporation (the “Company”,

“we”, “us”, “our”) was originally incorporated in Maine in 1982 and reincorporated in Delaware in

1987, in conjunction with an initial public offering of common stock.

We are an animal health company whose purpose is to create scientifically

proven and practical products that improve the health and productivity of dairy and beef cattle.

We focus on the two most critical stages

of dairy productivity, those being the first 30 days of life and the first 30 days of lactation.

Our concentrated colostrum and purified

Nisin technologies offer unique animal health solutions during these periods when immunity is at its most vulnerable.

As disclosed in

Note 16, “Segment Information”, one of our business segments is dedicated to Scours and the other is focused on Mastitis.

We manufacture and market the First Defense ® product line, providing Immediate Immunity™ to prevent

scours in newborn dairy and beef calves.

We have expanded this line into four different products with formulations targeting E.

coronavirus and rotavirus pathogens.

We are also developing Re-Tain ® , a treatment for lactating dairy cows with

subclinical mastitis.

Mastitis is the most significant cause of economic loss to the dairy industry.

These products help reduce the need

to use traditional antibiotics in food producing animals.

We are subject to certain risks including dependence on key individuals and

third-party providers of critical goods and services, competition from other larger companies, the successful sale of existing products

and the development of new viable products with appropriate regulatory approvals, where applicable.

A combination of the conditions, trends

and concerns related to or arising from inflation, rising interest rates and potential recessionary conditions in the United States and/or

internationally, could have a corresponding negative effect on our business and operations.

We are experiencing price increases in key

components, supportive services, transportation and other supplies that are causing our costs of goods sold to increase.

We have experienced

contamination events from time to time in our production process, beginning in the third quarter of 2022, as disclosed previously.

implemented a production slowdown during 2023 to remediate this problem, which led to the recognition of lower sales and gross margin.

The last identified contamination event occurred during the first half of April of 2024, and we have been operating without further contamination

events since then and through the time of this filing on March 28, 2025.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of Presentation

We have prepared the accompanying audited financial

statements reflecting all adjustments (which are of a normal recurring nature) that are, in our opinion, necessary in order to ensure

that the financial statements are not misleading.

We follow accounting standards set by the Financial Accounting Standards Board (FASB).

The FASB sets Generally Accepted Accounting Principles (GAAP) that we follow to ensure we accurately report our financial condition, results

of operations, earnings per share and cash flows.

References to GAAP in these footnotes are to the FASB Accounting Standards Codification ™

(Codification).

THE COMPANY AND NATURE OF OPERATIONS

ImmuCell Corporation (the “Company”, “we”, “us”, “our”) is an animal health biologics company focused on the development, manufacture and commercialization of products intended to improve the survivability, health and long-term performance of neonatal dairy and beef calves.

We primarily manufacture and market the First Defense ® product line, providing Immediate Immunity™ to prevent scours in newborn dairy and beef calves.

Generally, our products are promoted to veterinarians as well as dairy and beef producers by our sales team and then sold through distributors.

Our primary market is North America although we do sell into other select international regions.

Beginning in the early 2000s, we initiated the development of Re-Tain ® , our purified Nisin treatment for sub-clinical mastitis in lactating dairy cows.

During late 2025, we made the decision to focus on First Defense ® and pause further investment in Re-Tain ® manufacturing.

BASIS OF PRESENTATION AND USE OF ESTIMATES AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Use of Estimates

We have prepared the accompanying audited financial statements in accordance with Generally Accepted Accounting Principles (GAAP), which requires us to reflect all adjustments (which are of a normal recurring nature) that are, in our opinion, necessary in order to ensure that the financial statements are not misleading.

References to GAAP in these footnotes are to the FASB Accounting Standards Codification ™ (ASC).

We believe that the disclosures are adequate to ensure that the information presented is not misleading.

(b) Cash and Cash Equivalents

We consider all highly liquid investment instruments

that mature within three months of their purchase dates to be cash equivalents.

Cash equivalents are principally invested in securities

backed by the U.S.

We hold no cash or cash equivalents in excess of Federal Deposit Insurance Corporation (FDIC) limits of

$ 250,000 per financial institution per depositor.

Accounts receivable are carried at the original

invoice amount less an estimate made for credit losses, when applicable.

Management determines the allowance for credit losses on a monthly

basis by identifying troubled accounts and by using historical experience applied to an aging of accounts and other relevant factors.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period.

Although we regularly assess these estimates, actual amounts could differ from those estimates and are subject to change in the near term.

Changes in estimates are recorded during the period in which they become known.

Significant estimates include our valuation of inventory, deferred tax assets, and the impairment of long-lived assets.

Significant Accounting Policies

Cash and Cash Equivalents

We consider all highly liquid investment instruments that mature within three months of their purchase dates to be cash equivalents.

Our cash equivalents are principally invested in securities backed by the U.S.

We hold no cash or cash equivalents in excess of Federal Deposit Insurance Corporation (FDIC) limits of $ 250,000 per financial institution per depositor.

Trade Accounts Receivable

Accounts receivable are carried at the original invoice amount less an estimate made for credit losses, when applicable.

Management determines the current estimate of expected credit losses on a monthly basis by identifying troubled accounts and by using historical experience applied to an aging of accounts and other relevant factors.

Accounts receivable are considered to be past due if a portion of the receivable balance is outstanding for more than 30 days.

accounts receivable are subject to an interest charge.

It was not necessary to charge interest on past due accounts during the years ended

December 31, 2024 or 2023 because the time past due was not significant, and there was no accrual for such interest charges as of December

31, 2024 or 2023.

Past due accounts receivable are subject to an interest charge.

We did not charge interest on past due accounts during the years ended December 31, 2025 or 2024 because the time past due was not significant, and there was no accrual for such interest charges as of December 31, 2025 or 2024 .

As of December 31, 2025 and 2024 , we determined that no allowance for credit losses was necessary.

Accounts receivable

are written off when deemed uncollectible.

Accounts receivable are written off when deemed uncollectible.

No accounts receivable were written off during the years ended December 31, 2025 or 2024 .

of accounts receivable previously written off are recorded as income when received.

No such recoveries were recorded during the years

ended December 31, 2024 or 2023.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

(d) Inventory

Inventory includes raw materials, work-in-process

and finished goods and is recorded at the lower of cost, on the first-in, first-out method, or net realizable value (determined as the

estimated selling price in the normal course of business, less reasonably predictable costs of completion, disposal and transportation).

Recoveries of accounts receivable previously written off are recorded as income when received.

No such recoveries were recorded during the years ended December 31, 2025 or 2024 .

See Note 3, "Trade Accounts Receivable".

Inventory includes raw materials, work-in-process and finished goods and is recorded at the lower of cost, on the first -in, first -out method, or net realizable value (determined as the estimated selling price in the normal course of business, less reasonably predictable costs of completion, disposal and transportation).

Work-in-process and finished goods inventories include materials, labor and manufacturing overhead.

At each balance sheet date, we evaluate

our ending inventories for excess quantities and obsolescence.

Inventories that we consider excess or obsolete are written down to estimated

net realizable value.

At each balance sheet date, we evaluate our ending inventories for excess quantities and obsolescence.

Inventories that we consider in excess, expired, or obsolete are written down to their estimated net realizable value.

Once inventory is written down and a new cost basis is established, it is not written back up.

We believe that supplies

and raw materials for the production of our products are available from more than one vendor or farm.

Our policy is to maintain more than

one source of supply for the components used in our products when feasible.

(e) Property, Plant and Equipment, net

We depreciate property, plant and equipment on the

straight-line method by charges to operations and costs of goods sold in amounts estimated to expense the cost of the assets from the

date they are first put into service to the end of the estimated useful lives of the assets.

The facility we have constructed at 33 Caddie

Lane to produce the Nisin Drug Substance (DS) for Re-Tain ® ( Building 33 ) is being depreciated over 39 years

from when a Certificate of Occupancy was issued during the fourth quarter of 2017.

We began depreciating the equipment for our Nisin DS

facility when it was placed in service during the third quarter of 2018.

Approximately 86 % of these assets are being depreciated over

We began depreciating the leasehold improvements to our new First Defense ® production facility at 175

Industrial Way ( Building 175A ) over the remainder of the 10 -year lease term beginning when a Certificate of Occupancy was issued

during the second quarter of 2020.

During August of 2022, this lease term was extended to January of 2043 in connection with a new lease

covering additional space at 175 Industrial Way ( Building 175B ).

As a result, the net book value of these leasehold improvements

as of August 31, 2022 is now being depreciated over the remainder of the extended lease term.

Significant repairs to property, plant and

equipment that benefit more than a current period are capitalized and depreciated over their useful lives.

Insignificant repairs are expensed

when incurred.

See Notes 2(h) and 6 for additional disclosures.

(f) Operating Leases

We account for our real estate leases using a

right-of-use model, which recognizes that at the date of commencement, a lessee has a financial obligation to make lease payments to the

lessor for the right to use the underlying asset during the lease term and recognizes a corresponding right-of-use (ROU) asset related

to this right.

ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of the future

lease payments over the expected lease term.

The ROU asset is also adjusted for any lease prepayments made, lease incentives received

and initial direct costs incurred.

For operating leases with lease payments that fluctuate over the lease term, the total lease costs

are recognized on a straight-line basis over the lease term.

Our leases, at times, may include options to extend the term of the lease.

When it is reasonably certain that we will exercise the option, we include the impact of the option in the lease term for purposes of

determining future lease payments.

For all underlying classes of assets, we made an accounting policy election to not recognize assets

or liabilities for leases with a term of twelve months or less and to account for all components in a lease arrangement as a single combined

lease component.

Short-term lease payments are recognized on a straight-line basis.

Certain of our lease agreements include variable rent

payments, consisting primarily of amounts paid to the lessor based on cost or consumption, such as maintenance and real estate taxes.

These costs are recognized in the period in which the obligation is incurred.

Because our leases do not specify an implicit rate, we use

an incremental borrowing rate based on information available at the lease commencement date to determine the present value of the lease

We evaluate our ROU asset for impairment when events or changes in circumstances indicate that the carrying value of the asset

may not be recoverable.

See Notes 2(h) and 11 for additional disclosures.

(g) Intangible Assets and Goodwill

We amortize intangible assets on the straight-line

method by charges to costs of goods sold in amounts estimated to expense the cost of the assets from the date they are first put into

service to the end of the estimated useful lives of the assets.

We have recorded intangible assets related to customer relationships,

non-compete agreements and developed technology, each with defined useful lives.

Amounts paid in excess of the fair value of the net assets

(including tax attributes) are recorded as goodwill under the acquisition method of accounting.

We assess the impairment of intangible

assets that have indefinite lives (when applicable) and goodwill (at the reporting unit level) on an annual basis (as of December 31 st )

and whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

We would record

an impairment charge if such an assessment were to indicate that the fair value of such assets was less than the carrying value.

is required in determining whether an event has occurred that may impair the value of goodwill or identifiable intangible assets.

that could indicate that an impairment may exist include significant under-performance relative to plan or long-term projections, significant

changes in business strategy and significant negative industry or economic trends.

Although we believe intangible assets and goodwill

are properly stated in the accompanying financial statements, changes in strategy or market conditions could significantly impact these

judgments and require an adjustment to the recorded balance in the future.

No goodwill impairments were recorded during the years ended

December 31, 2024 or 2023.

See Notes 2(h) and 7 for additional disclosures.

Our policy is to maintain more than one source of supply for the components used in our products, when feasible.

See Note 4, "Inventory".

Property, Plant and Equipment, Net

We record property, plant and equipment at cost, which we depreciate on the straight-line method by charges to operating expenses and costs of goods sold from the date they are first put into service to the end of the estimated useful lives of the assets.

Estimated Useful Lives (in years)

Laboratory and manufacturing equipment

Buildings and improvements

Office furniture and equipment 3 - 10

Leasehold improvements are depreciated over the shorter of their estimated useful lives or the remaining lease term.

Significant repairs to property, plant and equipment that benefit more than a current period are capitalized and depreciated over their useful lives.

Insignificant repairs and all maintenance are expensed when incurred.

See Note 6, "Property, Plant and Equipment, Net".

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

(h) Valuation of Long-Lived Assets

We periodically evaluate our long-lived assets,

consisting principally of property, plant and equipment, operating lease right-of-use asset and amortizable intangible assets, for potential

In accordance with the applicable accounting guidance for the treatment of long-lived assets, we review the carrying value

of our long-lived assets or asset group that is held and used, including intangible assets subject to amortization, for impairment whenever

events and circumstances indicate that the carrying value of the assets may not be recoverable.

Under the held for use approach, the asset

or asset group to be tested for impairment should represent the lowest level for which identifiable cash flows are largely independent

of the cash flows of other groups of assets and liabilities.

No impairment was recognized during the years ended December 31, 2024 or

(i) Fair Value Measurements

In determining

fair value measurements, we follow the provisions of Codification Topic 820, Fair Value Measurements and Disclosures .

Topic 820 defines fair value, establishes a framework for measuring fair value under GAAP and enhances disclosures about fair value measurements.

The topic provides a consistent definition of fair value which focuses on an exit price, which is the price that would be received to

sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

also prioritizes, within the measurement of fair value, the use of market-based information over entity-specific information and establishes

a three-level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of

the measurement date.

As of December 31, 2024 and 2023, the carrying amounts of cash and cash equivalents, accounts receivable, inventory,

prepaid expenses and other current assets, other assets, accounts payable and accrued expenses approximate fair value because of their

short-term nature.

The amount outstanding under our bank debt facilities is measured at carrying value in our accompanying balance sheets.

Our bank debt facilities are valued using Level 2 inputs.

Operating Leases

We account for our real estate leases under ASC 842 Leases , which requires us to recognize a lease liability and corresponding right-of-use (ROU) asset at lease commencement.

Our lease liability represents the present value of all non-cancellable fixed future lease payments.

Our leases, at times, may include options to extend the term of the lease.

When it is reasonably certain that we will exercise the option, we include the impact of the option in the lease term for purposes of determining future lease payments.

Because our leases do not specify an implicit rate, we use an incremental borrowing rate based on information available at the lease commencement date to determine the present value of the lease payments.

The incremental borrowing rate represents the rate for a secured loan with similar terms.

At the commencement date, we adjust the ROU asset for any lease prepayments made, lease incentives received and initial direct costs incurred, when applicable.

We evaluate our ROU asset for impairment when events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

For operating leases with lease payments that fluctuate over the lease term, the total lease costs are recognized on a straight-line basis over the lease term.

Certain of our lease agreements include variable rent payments, consisting primarily of amounts paid to the lessor based on cost or consumption, such as maintenance and real estate taxes.

For all underlying classes of assets, we made an accounting policy election to not recognize assets or liabilities for leases with a term of twelve months or less and to account for all components in a lease arrangement as a single combined lease component.

Short-term lease payments are insignificant during both the years ended December 31, 2025 and 2024.

These costs are recognized in the period in which the obligation is incurred.

See Note 11, "Operating Leases".

Intangible Assets and Goodwill

We amortize intangible assets using the straight-line method by charges to costs of goods sold in amounts estimated to expense the cost of the assets from the date they are first put into service to the end of the estimated useful lives of the assets.

We have recorded intangible assets related to customer relationships, non-compete agreements and developed technology, each with defined useful lives.

Amounts paid in excess of the fair value of the net assets (including tax attributes) are recorded as goodwill under the acquisition method of accounting.

We assess the impairment of intangible assets that have indefinite lives (when applicable) and goodwill (at the reporting unit level) on an annual basis (as of December 31 st ) and whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

We would record an impairment charge if such an assessment were to indicate that the fair value of such assets was less than the carrying value.

Judgment is required in determining whether an event has occurred that may impair the value of goodwill or identifiable intangible assets.

Factors that could indicate that an impairment may exist include significant under-performance relative to plan or long-term projections, significant changes in business strategy and significant negative industry or economic trends.

Although we believe intangible assets and goodwill are properly stated in the accompanying financial statements, changes in strategy or market conditions could significantly impact these judgments and require an adjustment to the recorded balance in the future.

No goodwill impairments were recorded during the years ended December 31, 2025 or 2024 .

See Note 7, "Intangible Assets".

Impairment of Long-Lived Assets

We periodically evaluate our long-lived assets, consisting principally of property, plant and equipment, net, operating lease ROU asset and amortizable intangible assets, for potential impairment.

In accordance with the applicable accounting guidance for the treatment of long-lived assets, we review the carrying value of our long-lived assets or asset group that is held and used, including intangible assets subject to amortization, for impairment whenever events and circumstances indicate that the carrying value of the assets may not be recoverable.

Under the held for use approach, the asset or asset group to be tested for impairment should represent the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.

If the carrying amount of a long-lived asset group exceeds the related undiscounted future cash flows, we recognize an impairment loss by the amount that the carrying value of the asset exceeds fair value.

See Note 6, "Property, Plant and Equipment, Net" for discussion of our impairment charge during the year ended December 31, 2025 as well as discussion of idle assets that are being monitored for potential impairment.

No other impairments were recognized during the year ended December 31, 2025.

There were no impairments recognized during the year ended December 31, 2024.

Fair Value Measurements

In determining fair value measurements, we follow the provisions of ASC 820, Fair Value Measurements and Disclosures .

The ASC provides a consistent definition of fair value which focuses on an exit price, which is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The topic also prioritizes, within the measurement of fair value, the use of market-based information over entity-specific information and establishes a three -level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date.

The three -level hierarchy is as follows:

Pricing inputs are quoted prices available in active markets for identical assets or liabilities as of the measurement date.

Pricing inputs are quoted prices for similar assets or liabilities, or inputs that are observable, either directly or indirectly, for substantially the full term through corroboration with observable market data.

Pricing inputs are unobservable for the assets or liabilities, that is, inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability.

In certain cases, the inputs used to measure fair

value may fall into different levels of the fair value hierarchy.

In such cases, the level of an asset or liability within the fair value

hierarchy is based on the lowest level of input that is significant to the fair value measurement.

Our assessment of the significance

of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment.

We also hold money market accounts in our bank account, which are classified as cash equivalents and measured at fair value.

value of these investments is based on their closing published net asset value.

Level 1 — Pricing inputs are quoted prices available in active markets for identical assets or liabilities as of the measurement date.

Level 2 — Pricing inputs are quoted prices for similar assets or liabilities, or inputs that are observable, either directly or indirectly, for substantially the full term through corroboration with observable market data.

Level 3 — Pricing inputs are unobservable for the assets or liabilities, that is, inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

We assess the levels of the investments at each

measurement date, and transfers between levels are recognized on the actual date of the event or change in circumstances that caused the

transfer in accordance with our accounting policy regarding the recognition of transfers between levels of the fair value hierarchy.

the years ended December 31, 2024 and 2023, there were no transfers between levels.

As of December 31, 2024 and 2023, our Level 1 assets

measured at fair value by quoted prices in active markets consisted of cash and money market accounts.

There were no assets or liabilities

measured at fair value on a nonrecurring basis as of December 31, 2024 or 2023.

The carrying values of our cash and money market accounts

as of December 31, 2024 and 2023 approximated their fair market values.

Due to inflation and the changing interest rate environment, the

carrying values of our fixed rate bank debt as of December 31, 2024 and 2023 differed from their fair market values.

These values are

reflected in the following tables :

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.

In such cases, the level of an asset or liability within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment.

We evaluate assets and liabilities subject to fair value measurements on a recurring and nonrecurring basis to determine the appropriate level at which to classify them for each reporting period.

Some nonfinancial assets are measured at fair value only in certain circumstances, including the event of impairment.

During the year ended December 31, 2025, we remeasured certain property, plant and equipment at fair value on a nonrecurring basis using Level 3 inputs.

The fair value of the manufacturing equipment was determined by estimating the amount of future discounted cash flows expected to be generated from the manufacturing equipment, which represented the current estimate of the salvage value of the manufacturing equipment, since we determined that the assets have no additional future use or related cash flows aside from the proceeds resulting from their disposal.

The salvage value estimates were determined based on quotes provided by an equipment broker.

This remeasurement resulted in a $ 2,667,100 impairment charge related to property, plant and equipment, which is included in other expenses, net on the statement of operation for the year ended December 31, 2025.

See Note 6, "Property, Plant and Equipment, Net" for further discussion.

There were no assets or liabilities measured at fair value on a nonrecurring basis as of December 31, 2024 .

As of December 31, 2025 and 2024 , the carrying amounts of accounts receivable, inventory, prepaid expenses and other current assets, other assets, accounts payable and accrued expenses approximate fair value because of their short-term nature.

These assets and liability measured at fair value on a recurring basis are reflected in the following tables:

As of December 31, 2025

Cash and money market accounts (1)

$ 3,806,831 $ — $ 3,806,831

Bank debt (2)

$ — $ 8,457,433 $ 8,457,433

As of December 31, 2024

Cash and money market accounts (1)

(j) Concentration of Risk

Concentration of credit risk with respect to

accounts receivable is principally limited to certain customers to whom we make substantial sales.

To reduce risk, we routinely assess

the financial strength of our customers and, as a consequence, believe that our accounts receivable credit risk exposure is limited.

maintain an allowance for potential credit losses when deemed necessary, but historically we have not experienced significant credit losses

related to an individual customer or groups of customers in any particular industry or geographic area.

Sales to significant customers

that amounted to 10% or more of total product sales are detailed in the following table:

$ 3,758,232 $ — $ 3,758,232

Bank debt (2)

$ — $ 9,465,500 $ 9,465,500

( 1 ) Cash and cash equivalents are stated at nominal value, which equals fair value.

A portion of our cash and cash equivalents is invested in money market accounts.

The fair value of these investments is based on their closing published net asset value.

( 2 ) Due to inflation and the changing interest rate environment, the carrying values of our fixed rate bank debt as of December 31, 2025 and 2024 differed from their fair market values.

The amount outstanding under our bank debt facilities is measured at carrying value in our accompanying balance sheets.

We assess the levels of the investments at each measurement date, and transfers between levels are recognized on the actual date of the event or change in circumstances that caused the transfer in accordance with our accounting policy regarding the recognition of transfers between levels of the fair value hierarchy.

During the years ended December 31, 2025 and 2024 , there were no transfers between levels.

We had no assets or liabilities measured at fair value using level 3 inputs as of December 31, 2025 and 2024

Concentration of Risk

Concentration of credit risk with respect to accounts receivable is principally limited to certain customers to whom we make substantial sales.

To reduce risk, we routinely assess the financial strength of our customers and, as a consequence, believe that our accounts receivable credit risk exposure is limited.

We maintain an allowance for potential credit losses when deemed necessary, but historically we have not experienced significant credit losses related to an individual customer or groups of customers in any particular industry or geographic area.

Sales to significant customers that amounted to 10% or more of total product sales are detailed in the following table:

During the Years Ended

Trade accounts receivable due from significant

customers that amounted to 10% or more of our total trade accounts receivable are detailed in the following table:

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

(k) Revenue Recognition

We recognize revenue in accordance with Codification

Topic 606, Revenue from Contracts with Customers (ASC 606) .

ASC 606 is a single comprehensive model for companies to use in accounting

for revenue arising from contracts with customers.

The core principle is that we recognize the amount of revenue to which we expect to

be entitled for the transfer of promised goods or services to customers when a customer obtains control of promised goods or services

in an amount that reflects the consideration we expect to receive in exchange for those goods or services.

In addition, the standard requires

disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.

We conduct our

business with customers through valid purchase orders or sales orders which are considered contracts and are not interdependent on one

Trade accounts receivable due from significant customers that amounted to 10% or more of our total trade accounts receivable are detailed in the following table:

Revenue Recognition

We recognize revenue in accordance with ASC 606, Revenue from Contracts with Customers (ASC 606 ) .

ASC 606 requires that we recognize the amount of revenue to which we expect to be entitled for the transfer of promised goods to customers when a customer obtains control of promised goods in an amount that reflects the consideration we expect to receive in exchange for those goods.

We conduct our business with customers through valid purchase orders or sales orders which are considered contracts and are not interdependent on one another.

A performance obligation is a promise in a contract to transfer a distinct product to the customer.

The transaction price is

the amount of consideration we expect to receive under the arrangement.

Revenue is measured based on consideration specified in a contract

with a customer.

The transaction price of a contract is allocated to each distinct performance obligation and recognized when or as the

customer receives the benefit of the performance obligation.

Product transaction prices on a purchase or sales order are discrete and

We recognize revenue when we satisfy a performance obligation in a contract by transferring control over a product to a customer

when product ships to a customer.

The transaction price is the amount of consideration we expect to receive under the arrangement.

Revenue is measured based on consideration specified in a contract with a customer.

The transaction price of a contract is allocated to each distinct performance obligation and recognized when or as the customer receives the benefit of the performance obligation.

Product transaction prices on a purchase or sales order are discrete and stand-alone.

We recognize revenue when we satisfy a performance obligation in a contract by transferring control over a product to a customer when product ships to a customer.

Amounts due are typically paid approximately 30 days from the time control is transferred.

and handling costs associated with outbound freight are accounted for as a fulfillment cost in costs of goods sold.

We do not bill for

or collect sales tax because our sales are generally made to distributors and thus our sales to them are not subject to sales tax.

generally have experienced an immaterial amount of product returns.

See Note 13 for additional disclosures.

(l) Expense Recognition

We do not incur costs in connection with product

sales to customers that are eligible for capitalization.

Advertising costs are expensed when incurred, which is generally during the month

in which the advertisement is published.

Shipping and handling costs associated with outbound freight are accounted for as a fulfillment cost in costs of goods sold.

We do not bill for or collect sales tax because our sales are generally made to distributors and thus our sales to them are not subject to sales tax.

We generally have experienced an immaterial amount of product returns.

See Note 13, "Revenue".

Expense Recognition

We do not incur costs in connection with product sales to customers that are eligible for capitalization.

Advertising costs are expensed when incurred, which is generally during the month in which the advertisement is published.

Advertising costs amounted to $ 109,506 and $ 35,696 during the years ended December 31, 2025 and 2024, respectively.

All product development expenses are expensed as incurred, as are all related patent costs.

capitalize costs to produce inventory during the production cycle, and these costs are charged to costs of goods sold when the inventory

is sold to a customer or is deemed to be in excess or obsolete.

(m) Income Taxes

for income taxes in accordance with Codification Topic 740, Income Taxes , which requires that we recognize a current tax liability

or asset for current taxes payable or refundable and a deferred tax liability or asset for the estimated future tax effects of temporary

differences and carryforwards to the extent they are realizable.

We consider future taxable income and feasible tax planning strategies

in assessing the need for a valuation allowance against our deferred tax assets at the end of each quarter.

If we determine that it is

more likely than not that we will realize our deferred tax assets in the future in excess of the net recorded amount over a reasonably

short period of time, a reduction of the valuation allowance would increase income in the period such determination was made.

if we determine that it is more likely than not that we will not realize all or part of our net deferred tax asset in the future, an

increase to the valuation allowance would be charged to income in the period such determination was made.

Topic 740-10 clarifies the accounting for income taxes by prescribing a minimum recognition threshold that a tax position must meet before

being recognized in the financial statements.

In the ordinary course of business, there are transactions and calculations where the ultimate

tax outcome is uncertain.

In addition, we are subject to periodic audits and examinations by the Internal Revenue Service and other taxing

We capitalize costs to produce inventory during the production cycle, and these costs are charged to costs of goods sold when the inventory is sold to a customer or is deemed to be expired or obsolete.

We account for income taxes in accordance with ASC 740, Income Taxes , which requires that we recognize a current tax liability or asset for current taxes payable or refundable and a deferred tax liability or asset for the estimated future tax effects of temporary differences and carryforwards to the extent they are realizable.

We consider future taxable income and feasible tax planning strategies in assessing the need for a valuation allowance against our deferred tax assets at the end of each quarter.

If we determine that it is more likely than not that we will realize our deferred tax assets in the future in excess of the net recorded amount over a reasonably short period of time, a reduction of the valuation allowance would increase income in the period such determination was made.

Likewise, if we determine that it is more likely than not that we will not realize all or part of our net deferred tax asset in the future, an increase to the valuation allowance would be charged to income in the period such determination was made.

ASC 740 - 10 clarifies the accounting for income taxes by prescribing a minimum recognition threshold that a tax position must meet before being recognized in the financial statements.

In the ordinary course of business, there are transactions and calculations where the ultimate tax outcome is uncertain.

In addition, we are subject to periodic audits and examinations by the Internal Revenue Service and other taxing authorities.

With few exceptions, we are no longer subject to income tax examinations by tax authorities for years before 2022.

evaluated the positions taken on our filed tax returns and have concluded that no uncertain tax positions existed as of December 31,

2024 or 2023.

We have evaluated the positions taken on our filed tax returns and have concluded that no uncertain tax positions existed as of December 31, 2025 or 2024 .

Although we believe that our estimates are reasonable, actual results could differ from these estimates.

(n) Stock-Based Compensation

We account for stock-based compensation in accordance

with Codification Topic 718, Compensation-Stock Compensation , which generally requires us to recognize non-cash compensation expense

for stock-based payments using the fair-value-based method.

The fair value of each stock option grant has been estimated on the date of

grant using the Black-Scholes option pricing model.

Accordingly, we recorded compensation expense pertaining to stock-based compensation

of $ 325,551 and $ 368,866 during the years ended December 31, 2024 and 2023, respectively.

(o) Net Loss Per Common Share

Net loss per common share has been computed in

accordance with Codification Topic 260-10, Earnings Per Share .

The net loss per share has been computed by dividing the net loss

by the weighted average number of common shares outstanding during the period.

All stock options have been excluded from the denominator

in the calculation of dilutive earnings per share when we are in a loss position because their inclusion would be anti-dilutive.

stock options that were not included in this calculation because the effect would be anti-dilutive amounted to 664,000 and 618,500 during

the years ended December 31, 2024 and 2023, respectively.

See Note 15, "Income Taxes".

Share-Based Compensation

We account for share-based compensation in accordance with ASC 718, Compensation-Stock Compensation , which generally requires us to recognize non-cash compensation expense for share-based payments using the fair-value-based method.

The expected life is calculated utilizing the simplified method, which uses the mid-point between the weighted average vesting period and the contractual term as the expected life.

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model and is recognized as compensation expense on a straight-line basis over the requisite service period for awards subject to time vesting conditions.

See Note 12, "Stockholders' Equity".

Earnings Per Share

Net income (loss) per common share has been computed in accordance with ASC 260, Earnings Per Share .

The basic net income per share has been computed by dividing net income by the weighted average number of common shares outstanding during the period.

The diluted net income per share has been computed by dividing net income by the weighted average number of shares outstanding during the period, plus all outstanding stock options with an exercise price that is less than the average market price of the common stock during the period, less the number of shares that could have been repurchased at this average market price with the proceeds from the hypothetical stock option exercises and proceeds from unrecognized compensation.

Stock options are excluded from the denominator in the calculation of dilutive earnings per share when their impact would be anti-dilutive.

Outstanding stock options that were not included in this calculation because the effect would be anti-dilutive amounted to 801,760 and 664,000 during the years ended December 31, 2025 and 2024 , respectively.

ImmuCell Corporation

3 unchanged sentences

Net loss attributable to stockholders

$ ( 1,040,027 ) $ ( 2,156,629 )

Weighted average common shares outstanding - Basic

9,026,130 8,167,244

Dilutive impact of share-based compensation awards (1)

Weighted average common shares outstanding - Diluted

Net loss per share:

(p) Use of Estimates

The preparation of financial statements in conformity

with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure

of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during

Although we regularly assess these estimates, actual amounts could differ from those estimates and are subject to change in

the near term.

Changes in estimates are recorded during the period in which they become known.

Significant estimates include our valuation

of inventory, deferred tax assets and costs of goods sold.

(q) New Accounting

Pronouncement Adopted

In November of 2023, the FASB issued ASU 2023-07,

Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment

disclosure requirements, primarily through enhanced disclosures about significant expenses.

The amendments require disclosure of significant

segment expenses that are regularly provided to our chief operating decision-maker and included within segment profit and loss.

of ASU 2023-07 did not have a material impact on our financial statements.

(r) New Accounting Pronouncements Not Yet Adopted

of 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , to provide disaggregated disclosures of specific

expense categories underlying all relevant income statement expense line items on an annual and interim basis.

The disclosure requirements

will be applied on a prospective basis, with the option to apply it retrospectively.

The effective date for the standard is for fiscal

years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

Early adoption is

9,026,130 8,167,244

( 1 ) All stock options are excluded from the dilutive impact of share-based compensation awards when we are in a loss position because their inclusion would be anti-dilutive.

New Accounting Pronouncement Adopted

In December of 2023, the Financial Accounting Standards Board (FASB) issued ASU 2023 - 09 , Income Taxes (Topic 740 ):

Improvements to Income Tax Disclosures , which improves the transparency of income tax disclosures requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction.

ASU 2023 - 09 also includes certain other amendments to improve the effectiveness of income tax disclosures.

We adopted ASU 2023 - 09 for the year ended December 31, 2025, and applied retrospective disclosures for all prior periods presented.

The adoption of ASU 2023 - 09 did not have a material impact on our financial statements.

New Accounting Pronouncements Not Yet Adopted

In November of 2024, the FASB issued ASU 2024 - 03, Disaggregation of Income Statement Expenses , to provide disaggregated disclosures of specific expense categories underlying all relevant income statement expense line items on an annual and interim basis.

The disclosure requirements will be applied on a prospective basis, with the option to apply it retrospectively.

The effective date for the standard is for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted.

We are evaluating ASU 2024 - 03 to determine its impact on our financial statements.

of 2023, the FASB issued ASU 2023-09 , Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which includes amendments

that enhance income tax disclosures, primarily through standardization and disaggregation of income tax rate reconciliation categories

and income taxes paid by jurisdiction.

The amendments are effective for annual periods beginning after December 15, 2024, with early

adoption permitted, and may be applied either prospectively or retrospectively.

We are currently evaluating ASU 2023-09 to assess the

impact on our financial statement disclosures and to determine the transition method in which the new guidance will be adopted.

TRADE ACCOUNTS RECEIVABLE

Trade accounts receivable amounted to $ 3,771,133

and $ 2,185,383 as of December 31, 2024 and 2023, respectively.

No allowance for credit losses or product returns was recorded as of December

31, 2024 or 2023.

We consider a broad range of information to estimate credit losses.

Historically, we have experienced a very low level

of credit loss expense, and most of our trade receivables are collected by the due date or within a few days of the due date.

We anticipate

no future events or conditions that would impact our ability to collect our accounts receivable.

Because of the generally short duration

from the balance sheet date to the date of collection, our collection rate is not expected to be significantly impacted by events occurring

after the balance sheet date.

The trade accounts receivable balances included $ 52,097 and $ 42,507 due from a related party as of December

31, 2024 and 2023, respectively.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

Historically, we have experienced a very low level of credit loss, and most of our trade receivables are collected by the due date or within a few days of the due date.

Because of the generally short duration from the balance sheet date to the date of collection, our collection rate is not expected to be significantly impacted by events occurring after the balance sheet date.

Accounts receivable past due more than 30 days are subject to an interest charge.

As of December 31, 2025 and 2024 , we determined that no allowance for credit losses or product returns was necessary.

Accounts receivable are written off when deemed uncollectible.

No accounts receivable were written off during the years ended December 31, 2025 or 2024 .

Recoveries of accounts receivable previously written off are recorded as income when received.

No such recoveries were recorded during the years ended December 31, 2025 or 2024 .

Inventory consisted of the following:

2 unchanged sentences

Raw materials

$ 1,650,778 $ 1,356,228

Work-in-process (1)

5,748,889 5,746,865

Finished goods

These inventory figures are net of write-offs of

scrapped inventory in the amounts of $ 406,565 and $ 527,133 during the years ended December 31, 2024 and 2023, respectively, that resulted

principally from contamination events and other production process losses.

1,867,702 9,530

$ 9,267,369 $ 7,112,623

( 1 ) Includes $ 3,402,201 and $ 3,590,628 of colostrum on hand as of December 31, 2025 and 2024, respectively.

PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consisted

of the following:

Prepaid expenses and other current assets consisted of the following:

December 31, 2025

1 unchanged sentence

Prepaid expenses

$ 420,496 $ 360,207

Other receivables

31,177 40,555

Prepaid expenses and other current assets

$ 451,673 $ 400,762

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment consisted of the following:

Property, plant and equipment, net consisted of the following:

December 31, 2025

1 unchanged sentence

Laboratory and manufacturing equipment (1)

$ 17,255,585 $ 21,234,259

Buildings and improvements

20,902,758 20,889,395

Office furniture and equipment

702,838 1,056,145

Construction in progress (1)

534,270 2,693,904

516,867 516,867

Property, plant and equipment, gross

Accumulated depreciation

39,912,318 46,390,570

Accumulated depreciation

( 18,837,624 ) ( 21,041,551 )

Property, plant and equipment, net (2)

As of December 31, 2024 and 2023, construction

in progress consisted principally of payments toward the First Defense ® production capacity expansion project and

equipment needed to bring the formulation and aseptic filling for Re-Tain ® in-house.

The costs associated with property,

plant and equipment disposals were $ 130,365 and $ 100,142 during the years ended December 31, 2024 and 2023, respectively.

expense was $ 2,668,077 and $ 2,697,897 during the years ended December 31, 2024 and 2023, respectively.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

$ 21,074,694 $ 25,349,019

( 1 ) We recognized $ 2,667,100 in non-cash impairment charges during the year ended December 31, 2025, related to the write down of machinery that we determined had no related future undiscounted cash flows other than the current estimated proceeds from its sale.

This determination was made after further delays in FDA regulatory approval of the Company's Re-Tain ® product in development.

As a result, we decided to focus on First Defense ® and pause further investment in Re-Tain ® manufacturing, leading to the Company no longer having a use for the machinery.

This impairment charge is included in other expense, net, in the accompanying statement of operations for the year ended December 31, 2025.

No similar impairment was recognized during the year ended December 31, 2024.

( 2 ) As of December 31, 2025, property, plant and equipment, net includes approximately $ 12,300,000 of idle assets, which primarily related to one of our manufacturing facilities that was previously utilized for Re-Tain ® that we now plan to refit for use in producing First Defense ® products.

We are monitoring these assets for impairment.

No impairment was recognized on these assets during the years ended December 31, 2025 or 2024.

As of December 31, 2025 and 2024 , construction in progress consisted principally of payments toward the First Defense ® production capacity expansion project.

Construction in progress also included $ 2,316,951 of equipment needed to bring the formulation and aseptic filling for Re-Tain ® in-house as of December 31, 2024, which has been written down to its fair value of $ 200,000 as of December 31, 2025.

The gross amounts associated with property, plant and equipment disposals were $ 3,076,911 and $ 130,365 as of December 31, 2025 and 2024, respectively, resulting in loss on disposal of property, plant and equipment of $ 106,350 and $ 15,391 during the years ended December 31, 2025 and 2024.

Depreciation expense was $ 2,710,497 and $ 2,668,077 during the years ended December 31, 2025 and 2024 , respectively.

INTANGIBLE ASSETS

Intangible assets of $ 191,040 were valued using

the relief from royalty method and are being amortized to costs of goods sold over their useful lives, which are estimated to be 10 years.

Intangible amortization expense was $ 19,104 during both of the years ended December 31, 2024 and 2023.

The net value of these intangibles

was $ 19,104 and $ 38,208 as of December 31, 2024 and 2023, respectively.

Intangible asset amortization expense is estimated to be $ 19,104

during the year ending December 31, 2025.

Intangible assets as of December 31, 2024 consisted

of the following:

Intangible assets were valued using the relief from royalty method and were amortized to costs of goods sold over their useful lives, which was estimated to be 10 years.

Intangible assets as of December 31, 2025 consisted of the following:

Developed technology

1 unchanged sentence

Customer relationships

1,300 ( 1,300 ) —

Non-compete agreements

5,640 ( 5,640 ) —

Intangible assets as of December 31, 2023 consisted

of the following:

$ 191,040 $ ( 191,040 ) $ —

Intangible assets as of December 31, 2024 consisted of the following:

Developed technology

1 unchanged sentence

Customer relationships

1,300 ( 1,170 ) 130

Non-compete agreements

5,640 ( 5,076 ) 564

$ 191,040 $ ( 171,936 ) $ 19,104

Amortization expense on intangible assets was $ 19,104 during both of the years ended December 31, 2025 and 2024 .

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consisted

of the following:

Accounts payable and accrued expenses consisted of the following:

December 31, 2025

1 unchanged sentence

Accounts payable – trade

$ 792,217 $ 934,883

Accounts payable – capital

Accrued payroll

1,032,479 1,195,703

Accrued professional fees

113,414 102,815

Accrued other

333,710 234,552

Income tax payable

Accounts payable and accrued expenses

$ 2,282,583 $ 2,482,522

Loans #1 and #2 :

During the first quarter

of 2020, we closed on a debt financing with Maine Community Bank (formerly known as Gorham Savings Bank) (MCB) aggregating $ 8,600,000 ,

which was comprised of a $ 5,100,000 mortgage note (Loan #1) that bears interest at a fixed rate of 3.50 % per annum (with a 10 -year term

and 25 -year amortization schedule and a balloon principal payment of $ 3,145,888 due during the first quarter of 2030) and a $ 3,500,000

note (Loan #2) that bears interest at a fixed rate of 3.50 % per annum (with a 7 -year term and amortization schedule).

The proceeds from

the 2020 debt refinancing were used to repay all bank debt outstanding at the time of closing and to provide some additional working capital.

During the first quarter of 2022, we closed on an additional $ 2,000,000 in mortgage debt, which bears interest at the fixed rate of 3.58 %

This was accomplished through an amendment of the original mortgage note (Loan #1) that increased the then outstanding principal

balance from $ 4,233,957 to $ 6,233,957 bearing interest at the blended fixed rate of 3.53 % per annum.

This increased the balloon payment

from $ 3,145,888 to $ 3,687,608 and extended the due date of the balloon payment from the first quarter of 2030 to the first quarter of

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

Line of Credit (LOC) :

Also during the first

quarter of 2020, MCB extended a $ 1,000,000 LOC to us that is available, as needed, through September 11, 2025.

Interest on borrowings

against the LOC is variable at the National Prime Rate per annum.

There was no outstanding balance under this LOC as of December 31, 2024

During the second quarter of 2020,

we received a loan from the Maine Technology Institute (MTI) in the aggregate principal amount of $ 500,000 .

The first 2.25 years of this

loan were interest-free with no interest accrual or required principal payments.

Beginning during the fourth quarter of 2022, Loan #3

became subject to quarterly principal and interest payments at a fixed rate of 5 % per annum over the final five years of the loan, through

the third quarter of 2027 if not repaid before then.

During the fourth quarter of 2020,

we closed on a $ 1,500,000 note with MCB that bears interest at a fixed rate of 3.50 % per annum (with a 7 -year term and amortization schedule).

Proceeds of $ 624,167 were used to prepay a portion of the outstanding principal on our mortgage note (Loan #1), which reduced the outstanding

balance to 80 % of the most recent appraised value of the property securing the debt, which allowed MCB to release the $ 1,400,000 that

had been held in escrow.

During the first quarter of 2020, we closed on a debt financing with Maine Community Bank (formerly known as Gorham Savings Bank) (MCB) aggregating $ 8,600,000 , which was comprised of a $ 5,100,000 mortgage note (Loan #1 ) that bears interest at a fixed rate of 3.50 % per annum (with a 10 -year term and 25 -year amortization schedule and a balloon principal payment of $ 3,145,888 due during the first quarter of 2030 ) and a $ 3,500,000 note (Loan #2 ) that bears interest at a fixed rate of 3.50 % per annum (with a 7 - year term and amortization schedule).

The proceeds from the 2020 debt refinancing were used to repay all bank debt outstanding at the time of closing and to provide some additional working capital.

During the first quarter of 2022, we closed on an additional $ 2,000,000 in mortgage debt, which bears interest at the fixed rate of 3.58 % per annum.

This was accomplished through an amendment of the original mortgage note (Loan #1 ) that increased the then outstanding principal balance from $ 4,233,957 to $ 6,233,957 bearing interest at the blended fixed rate of 3.53 % per annum.

This increased the balloon payment from $ 3,145,888 to $ 3,687,751 and extended the due date of the balloon payment from the first quarter of 2030 to the first quarter of 2032.

During the second quarter of 2020, we received a loan from the Maine Technology Institute (MTI) in the aggregate principal amount of $ 500,000 .

The first 2.25 years of this loan were interest-free with no interest accrual or required principal payments.

Beginning during the fourth quarter of 2022, Loan #3 became subject to quarterly principal and interest payments at a fixed rate of 5 % per annum over the final five years of the loan, through the third quarter of 2027 if not repaid before then.

During the fourth quarter of 2020, we closed on a $ 1,500,000 note with MCB that bears interest at a fixed rate of 3.50 % per annum (with a 7 -year term and amortization schedule).

Proceeds of $ 624,167 were used to prepay a portion of the outstanding principal on our mortgage note (Loan #1 ), which reduced the outstanding balance to 80 % of the most recent appraised value of the property securing the debt, which allowed MCB to release the $ 1,400,000 that had been held in escrow.

The remaining proceeds were available for general working capital purposes.

On June 30, 2021, we executed definitive

agreements covering a second loan from the MTI in the aggregate principal amount of $ 400,000 , proceeds from which were received in July

On June 30, 2021, we executed definitive agreements covering a second loan from the MTI in the aggregate principal amount of $ 400,000 , proceeds from which were received in July of 2021.

The first two years of this loan were interest-free with no interest accrual or required principal payments.

Principal and interest

payments at a fixed rate of 5 % per annum are due quarterly over the final 5.5 years of the loan, beginning during the third quarter of

2023 and continuing through the fourth quarter of 2028 if not repaid before then.

During the third quarter of 2023,

we closed on a $ 2,000,000 term loan bearing interest at a fixed rate of 7 % per annum from MCB.

The Finance Authority of Maine (FAME) provided

$ 1,000,000 of loan insurance to MCB.

This loan is repayable under a 7 -year amortization schedule with a balloon payment of $ 1,285,047

due during the third quarter of 2026.

Also during the third quarter of

2023, we closed on a $ 1,000,000 term loan bearing interest at a fixed rate of 8 % per annum from FAME.

The loan is repayable under a 7 -year

amortization schedule with a balloon payment of $ 649,259 due during the third quarter of 2026.

Loans #1, #2, #4, #6 and #7 are secured by liens

on substantially all of our assets and are subject to certain restrictions and financial covenants.

Loan #7 is subordinated to Loans #1,

#2, #4 and #6.

Reflecting our poor financial performance during 2023 and into the first nine months of 2024, the debt service covenant

(DSC) requirements for the twelve-month periods ended December 31, 2023, June 30, 2024, September 30, 2024 and December 31, 2024 were

waived pre-emptively by our lenders.

We are required to meet a minimum DSC ratio of 1.35 for the year ending December 31, 2025 and annually

In connection with these credit facilities, we incurred aggregate debt issuance and debt discount costs of $ 173,305 .

The amortization

of these debt issuance and debt discount costs is being recorded as a component of interest expense, included in other expenses, net,

and is being amortized on a straight-line basis over the underlying terms of the notes.

Loans #3 and #5 are unsecured and subordinated

to our indebtedness to MCB and FAME.

Failure to make timely payments of principal and interest, or otherwise to comply with the terms

of the agreements of Loans #3 and #5, would entitle the MTI to accelerate the maturity of such debt and demand repayment in full.

loans may be prepaid without penalty at any time.

Debt proceeds received and principal repayments

made (excluding our $ 1,000,000 line of credit) are reflected by loan during the periods as described in the tables below:

the Year Ended

December 31, 2024

the Year Ended

December 31, 2023

Debt Issuance

Debt Principal

Proceeds from

Debt Issuance

Debt Principal

Principal and interest payments at a fixed rate of 5 % per annum are due quarterly over the final 5.5 years of the loan, beginning during the third quarter of 2023 and continuing through the fourth quarter of 2028 if not repaid before then.

During the third quarter of 2023, we closed on a $ 2,000,000 term loan bearing interest at a fixed rate of 7 % per annum from MCB.

The Finance Authority of Maine (FAME) provided $ 1,000,000 of loan insurance to MCB.

This loan was repayable under a 7 -year amortization schedule with a balloon payment of $ 1,285,029 due during the third quarter of 2026.

This loan was refinanced during the year ended December 31, 2025, utilizing the proceeds from Loan #8 discussed below.

Also during the third quarter of 2023, we closed on a $ 1,000,000 term loan bearing interest at a fixed rate of 8 % per annum from FAME.

The loan was repayable under a 7 -year amortization schedule with a balloon payment of $ 649,267 due during the third quarter of 2026.

This loan was refinanced during the year ended December 31, 2025, utilizing the proceeds from Loan #8 discussed below.

During the year ended December 31, 2025, we refinanced some of our bank debt.

The principal amount of $ 1,525,852 outstanding as of the closing date under Loan #6 and the principal amount of $ 768,209 outstanding as of the closing date under Loan #7 were both refinanced into one MCB loan with a principal amount of $ 2,327,119 bearing interest at a fixed rate of 6.5 % per annum, a reduction from both Loan #6 and Loan #7.

This refinancing also removed the balloon principal payments that were due in July of 2026 under both Loans #6 and #7.

Principal and interest payments under the new loan of $ 45,637 per month are due over a five -year term ending during the third quarter of 2030.

Loans #1, #2, #4, and #8 are secured by liens on substantially all of our assets and are subject to certain restrictions and financial covenants.

As of December 31, 2025, we were required to meet a minimum debt service covenant (DSC) of 1.35 for the year and annually thereafter.

We are in compliance with these covenants as of December 31, 2025.

Loans #3 and #5 are unsecured and subordinated to our indebtedness to MCB.

Failure to make timely payments of principal and interest, or otherwise to comply with the terms of the agreements of Loans #3 and #5, would entitle the MTI to accelerate the maturity of such debt and demand repayment in full.

These loans may be prepaid without penalty at any time.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

Principal payments (net of debt issuance and debt

discount costs) due under bank loans outstanding as of December 31, 2024 (excluding our $ 1,000,000 line of credit) are reflected in the

following table by the year that payments are due:

During the Years Ending December 31,

Principal payments due under bank loans outstanding as of December 31, 2025 are reflected in the following table by the year that payments are due:

$ 1,622,434 $ 1,242,437 $ 821,163 $ 782,667 $ 642,988 $ 4,035,111 $ 9,146,800

Debt issuance cost (1)

( 9,585 ) ( 6,969 ) ( 5,062 ) ( 5,063 ) ( 4,442 ) ( 4,321 ) ( 35,442 )

Debt discount cost (1)

CONTINGENT LIABILITIES AND COMMITMENTS

Our bylaws, as amended, in effect provide that the

Company will indemnify its officers and directors against any liability arising from their responsibilities as officers and directors

to the maximum extent permitted by Delaware law.

In addition, we make similar indemnity undertakings with each director through a separate

indemnification agreement with that director.

The maximum payment that we may be required to make under such provisions is theoretically

unlimited and is impossible to determine.

We maintain directors’ and officers’ liability insurance, which may provide reimbursement

to the Company for payments made to, or on behalf of, officers and directors pursuant to the indemnification provisions.

Our indemnification

obligations were grandfathered under the provisions of Codification Topic 460 , Guarantees .

Accordingly, we have recorded no liability

for such obligations as of December 31, 2024 or 2023.

Since our incorporation, we have had no occasion to make any indemnification payment

to any of our officers or directors for any reason.

The development, manufacturing and marketing of

animal health care products entails an inherent risk that liability claims will be asserted against us during the normal course of business.

( 2,664 ) ( 2,664 ) ( 2,663 ) ( 2,663 ) ( 1,597 ) — ( 12,251 )

$ 1,610,185 $ 1,232,804 $ 813,438 $ 774,941 $ 636,949 $ 4,030,790 $ 9,099,107

( 1 ) In connection with these credit facilities, we incurred a total of both debt issuance and debt discount costs as of December 31, 2025 and 2024, of $ 97,522 and $ 173,305 , respectively.

The amortization of these debt issuance costs and debt discount costs is being recorded as a component of interest expense, included in other expenses, net, and is being amortized on a straight-line basis over the underlying terms of the notes.

We maintain a $ 1,000,000 line of credit (LOC) with MCB, which was extended during the third quarter of 2025 through September 11, 2026.

Interest on borrowings against the LOC is variable at the National Prime Rate per annum.

There was no outstanding balance under this LOC as of December 31, 2025 or 2024 .

COMMITMENTS AND CONTINGENCIES

Litigation and Regulatory

Our bylaws, as amended, in effect provide that the Company will indemnify its officers and directors against any liability arising from their responsibilities as officers and directors to the maximum extent permitted by Delaware law.

In addition, we make similar indemnity undertakings with each director through a separate indemnification agreement with that director.

The maximum payment that we may be required to make under such provisions is theoretically unlimited and is impossible to determine.

We maintain directors’ and officers’ liability insurance, which may provide reimbursement to the Company for payments made to, or on behalf of, officers and directors pursuant to the indemnification provisions.

Our indemnification obligations were grandfathered under the provisions of ASC 460 , Guarantees .

Accordingly, we have recorded no liability for such obligations as of December 31, 2025 or 2024 .

Since our incorporation, we have had no occasion to make any indemnification payment to any of our officers or directors for any reason.

The development, manufacturing and marketing of animal health care products entails an inherent risk that liability claims will be asserted against us during the normal course of business.

We are aware of no such claims against us as of the time of this filing on March 30, 2026.

We believe that we have reasonable levels of

liability insurance to support our operations.

We enter into agreements with third parties in the

ordinary course of business under which we are obligated to indemnify such third parties from and against various risks and losses.

precise terms of such indemnities vary with the nature of the agreement.

In many cases, we limit the maximum amount of our indemnification

obligations, but in some cases those obligations may be theoretically unlimited.

We have not incurred material expenses in discharging

any of these indemnification obligations and based on our analysis of the nature of the risks involved, we believe that the fair value

of the liabilities potentially arising under these agreements is minimal.

Accordingly, we recorded no liabilities for such obligations

as of December 31, 2024 or 2023.

We plan to purchase certain key parts (syringes)

and services (formulation, aseptic filling and final packaging) pertaining to Re-Tain ® Drug Product (DP), our Nisin-based

intramammary treatment of subclinical mastitis in lactating dairy cows, exclusively from contractors.

The contract for formulation, aseptic

filling and final packaging of DP terminated on November 30, 2024.

This contract was extended through March of 2026 for the purpose of

final packaging of existing DP inventory, but this contract extension does not anticipate the production of new DP inventory.

we initiated an investment in the necessary equipment to perform the DP formulation and aseptic filling services in-house, but this investment

has been paused at the present time.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

Effective March 28, 2022, we entered into an Amended

and Restated Separation and Deferred Compensation Agreement (the “Deferred Compensation Agreement”) with Mr.

President and CEO) that superseded and replaced in its entirety a March 2020 severance agreement between the Company and Mr.

Upon separation from the Company for any reason, Mr.

Brigham’s Deferred Compensation Agreement allows Mr.

Brigham to be paid, among

other amounts, all earned and unused paid time off.

Accordingly, an expense of $ 222,379 for earned and unpaid sick time was accrued during

the first quarter of 2022 and a related accrual of $ 230,162 was included in accounts payable and accrued expenses as of December 31, 2024

We enter into agreements with third parties in the ordinary course of business under which we are obligated to indemnify such third parties from and against various risks and losses.

The precise terms of such indemnities vary with the nature of the agreement.

In many cases, we limit the maximum amount of our indemnification obligations, but in some cases those obligations may be theoretically unlimited.

We have not incurred material expenses in discharging any of these indemnification obligations and based on our analysis of the nature of the risks involved, we believe that the fair value of the liabilities potentially arising under these agreements is minimal.

Accordingly, we recorded no liabilities for such obligations as of December 31, 2025 or 2024 .

Employee Compensation

Effective March 28, 2022, we entered into an Amended and Restated Separation and Deferred Compensation Agreement (the “Deferred Compensation Agreement”) with Mr.

Brigham (our former President and CEO) that superseded and replaced in its entirety a March 2020 severance agreement between the Company and Mr.

Upon separation from the Company during January of 2026, Mr.

Brigham’s Deferred Compensation Agreement allowed Mr.

Brigham to be paid, among other amounts, all earned and unused paid time off.

Accordingly, a related accrual of $ 239,369 and $ 230,162 was included in accounts payable and accrued expenses as of December 31, 2025 and 2024 , respectively.

Additionally, Mr.

Brigham was paid $ 300,000 in deferred compensation during the first quarter of 2025 (which was accrued over

the three-year period ending in December 2024).

This deferred compensation payment vested as to $ 300,000 , $ 200,000 and $ 100,000 on January

1, 2025, 2024 and 2023, respectively.

Deferred compensation of $ 300,000 and $ 200,000 was included in accounts payable and accrued expenses

on the accompanying balance sheets as of December 31, 2024 and 2023, respectively.

In addition, upon termination of Mr.

employment (a) by the Company other than for cause, (b) due to death or disability or (c) by Mr.

Brigham for good reason, in each case

as described and defined in the Deferred Compensation Agreement, the Company agrees to pay Mr.

Brigham 100 % of his then current annual

base salary and a lump sum payment equal to the employer portion of the costs of continued health benefits for Mr.

Brigham and his covered

dependents for a twelve-month period following termination, and certain equity incentive awards granted to Mr.

Brigham would continue

to vest following such termination in accordance with the terms of the Deferred Compensation Agreement.

compensation agreements may be entered into with Mr.

Brockmann (our Vice President of Sales and Marketing) and Ms.

(formerly our Vice President of Manufacturing Operations), which, at times, allow these executives to earn incentive compensation if certain

regulatory and financial objectives are met during the year to which the agreement relates, as specified in their agreements.

related to these incentive compensation agreements are accrued over the period they are earned (when it is probable that the amounts will

be earned) based on our best estimate of the amounts expected to be earned.

In addition to the commitments discussed above,

we had committed $ 67,000 to increase our production capacity for the First Defense ® product line, $ 1,629,000 to

the purchase of inventory and $ 686,000 to information technology services and other obligations as of December 31, 2024.

Brigham was paid $ 300,000 in deferred compensation during the first quarter of 2025, which was included in accounts payable and accrued expenses on the accompanying balance sheet as of December 31, 2024.

As of December 31, 2025, the Company had $ 100,000 recorded in accounts payable and accrued expenses related to a retention bonus and performance bonus in equal amounts, due to Mr.

Brigham in the first quarter of 2026.

As of September 29, 2025, we entered into an employment agreement with Mr.

te Boekhorst (effective upon commencement of employment as Company President and Chief Executive Officer starting November 1, 2025) under which he will receive an annual base salary of $ 450,000 .

He also will be entitled to earn annual cash bonuses of up to an additional $ 400,000 per year subject to the Company having achieved financial improvement targets from the prior year set in advance by the Company's Board of Directors or its Compensation and Stock Option Committee.

The targets for 2026 were negotiated between Mr.

te Boekhorst and the Compensation and Stock Option Committee in the first quarter of 2026.

He also received a one -time $ 100,000 signing bonus upon commencement of employment (subject to repayment by him in certain events involving cessation of employment within one year of commencement).

In the event the Company terminates Mr.

te Boekhorst's employment without cause or he terminates his employment for good reason (each as defined), he will become eligible for severance compensation consisting of one year's base annual salary, up to 12 months of COBRA cost reimbursement, up to 12 months of accelerated vesting of his outstanding stock options, and an extended period ( 24 months) within which to exercise his vested stock options.

Other Commitments

In addition to the commitments discussed above, we had committed $ 46,000 to increase our production capacity for the First Defense ® product line, $ 1,326,000 to the purchase of inventory, $ 269,000 to information technology services, $ 312,000 to cold storage services, and $ 527,000 for other obligations as of December 31, 2025.

ImmuCell Corporation

1 unchanged sentence

OPERATING LEASES

12, 2019, we entered into a lease covering approximately 14,300 square feet of office and warehouse space with a possession date of November

15, 2019 and a commencement date of February 13, 2020.

The property is located at 175 Industrial Way in Portland ( Building 175A ),

which is a short distance from our headquarters and manufacturing facility at 56 Evergreen Drive.

We renovated this space to meet our

needs in expanding our production capacity for the First Defense ® product line.

The original lease term was ten

years with a right to renew for a second 10 -year term and a right of first offer to purchase.

At the time we entered into this lease,

we were not reasonably assured that we would exercise this renewal option in place of other real estate options.

For that reason, a 10-year

period was reflected in the right-of-use (ROU) asset and lease liability on our balance sheet.

During the third quarter of 2022, we committed

to lease an additional 15,400 square feet of space at 175 Industrial Way ( Building 175B ), which is connected to the original space,

over a 20 -year term.

The ROU asset and lease liability for the committed space at Building 175B was recorded as of April 1, 2023

after construction of the building shell was completed in accordance with the lease agreement.

Monthly lease payments commenced as of

August 1, 2023.

In connection with the lease commitment for space at Building 175B ,

the term of the original lease for Building 175A was extended by approximately 13 years.

On November 14, 2023, June 11,

2024 and September 20, 2024, we amended this lease further to provide for certain tenant improvements on the leased premises to be paid

for by our landlord.

These improvements will provide heat to an unfinished space, provide additional warehouse space, and create a new

primary shipping and receiving facility.

As a result of these three amendments and in consideration for the landlord agreeing to pay

for the cost of those certain tenant improvements, we agreed to make additional rent payments of $ 20,000 per month from November of 2023

through June of 2025 and a one-time additional rent payment of $ 248,743 in July of 2025.

Because of these modifications to the lease

payments, the ROU asset and lease liability associated with the space at Building 175B were remeasured as of the modification

Our leases include variable non-lease components.

Such payments primarily include common area maintenance charges.

As of December

31, 2024, the balance of the operating lease ROU asset was $ 4,560,679 and the operating lease liability was $ 4,561,174 .

We have non-cancelable operating lease agreements for certain office and warehouse space through January of 2043.

Minimum lease payments include the fixed lease component of the agreement, as well as fixed rate increases that are initially measured at the lease commencement date.

Our lease agreements include variable components such as common area maintenance charges and real estate taxes.

Variable lease payments based on consumption and leases with terms less than twelve months are insignificant and expensed as incurred.

The following table presents our lease assets and liabilities by their balance sheet classification:

As of December 31,

31, 2023, the balance of the operating lease ROU asset was $ 4,571,149 and the operating lease liability was $ 4,721,385 .

The calculated

amount of the ROU asset and lease liability is impacted by the length of the lease term and the discount rate used for the present value

of the minimum lease payments.

We elected not to separate lease and non-lease components for all classes of underlying assets, and instead

to account for them as a single lease component.

Variable lease cost primarily represents variable payments such as real estate taxes

and common area maintenance.

Operating lease right-of-use asset

$ 4,379,628 $ 4,560,679

Lease liabilities

Current portion of operating lease liability (1)

$ 85,489 $ 432,072

Operating lease liability, net of current portion

$ 4,009,788 $ 4,129,102

( 1 ) During the year ended December 31, 2025, we made a balloon payment to our landlord in accordance with the terms of the lease agreement, resulting in the significant decrease in the current portion of our operating lease liability as of December 31, 2025.

The following tables describe our lease costs and other lease information:

2 unchanged sentences

Operating lease cost

Fixed lease cost

$ 404,529 $ 427,519

Variable lease cost

74,186 66,523

Total lease cost

Operating Lease

Cash paid for operating lease liabilities $ 577,260 $ 248,595

$ 478,715 $ 494,042

Weighted average remaining lease term (in years)

Weighted average discount rate (1)

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

Future lease payments required under non-cancelable

operating leases in effect as of December 31, 2024 were as follows:

6.56 % 6.60 %

( 1 ) We assess the incremental borrowing rate at the commencement date and any subsequent modification dates.

The following table presents supplemental cash and non-cash information:

During the Years

Ended December 31,

Cash paid for operating lease liabilities

$ 689,375 $ 577,260

Operating lease right-of-use assets obtained in exchange for operating lease liabilities

$ — $ 103,115

Future lease payments required under non-cancelable operating leases in effect as of December 31, 2025 were as follows:

During the years ending December 31,

Total lease payments (undiscounted cash flows)

imputed interest (discount effect of cash flows)

Total lease payments

imputed interest

( 2,867,480 )

2 unchanged sentences

Common Stock Issuances

From February of 2016 to April of 2021, we sold

the aggregate of 4,553,017 shares of common stock in six different transactions raising gross proceeds of $ 26,714,403 at the weighted

average price of $ 5.87 per share.

These funds have been essential to funding our business growth plans.

On April 9, 2024, our shelf registration on Form

S-3 relating to the offer, issuance and sale by the Company of up to $ 20,000,000 of securities was declared effective by the Securities

and Exchange Commission.

Also on April 9, 2024, we entered into an At-The-Market (ATM) Agreement with Craig-Hallum Capital Group LLC,

pursuant to which we may offer and sell up to $ 11,000,000 of shares of our common stock.

Legal, accounting and other fees in the amount

of $ 152,272 associated with the completion of the shelf registration and the ATM Agreement were initially capitalized and then were offset

against the initial proceeds received during the second quarter of 2024.

As of December 31, 2024, we have sold 1,228,227 shares under

the ATM Offering conducted pursuant to the ATM Agreement.

Net proceeds through December 31, 2024 from shares sold pursuant to the ATM

Agreement (net of the upfront legal, accounting and other fees), less sales commissions of $ 139,562 , were $ 4,356,188 .

Stock Option Plans

In June of 2010, our stockholders approved the 2010

Stock Option and Incentive Plan (the “2010 Plan”) pursuant to the provisions of the Internal Revenue Code of 1986, under which

employees and certain service providers may be granted options to purchase shares of the Company’s common stock at no less than

fair market value on the date of grant.

At that time, 300,000 shares of common stock were reserved for issuance under the 2010 Plan and

subsequently no additional shares have been reserved for the 2010 Plan.

Vesting requirements are determined by the Compensation and Stock

Option Committee of the Board of Directors on a case-by-case basis.

All options granted under the 2010 Plan expire no later than 10 years

from the date of grant.

The 2010 Plan expired in June of 2020, after which date no further options can be granted under the 2010 Plan.

However, options outstanding under the 2010 Plan at that time can be exercised in accordance with their terms.

There were 183,500 and

188,500 options outstanding under the 2010 Plan as of December 31, 2024 and 2023, respectively.

From February of 2016 to April of 2021, we sold the aggregate of 4,553,017 shares of common stock in six different transactions raising gross proceeds of $ 26,714,403 at the weighted average price of $ 5.87 per share.

On April 9, 2024, our shelf registration on Form S- 3 relating to the offer, issuance and sale by the Company of up to $ 20,000,000 of securities was declared effective by the Securities and Exchange Commission.

Also on April 9, 2024, we entered into an ATM Agreement with Craig-Hallum Capital Group LLC, pursuant to which we may offer and sell up to $ 11,000,000 of shares of our common stock.

Legal, accounting and other fees in the amount of $ 152,272 associated with the completion of the shelf registration and the ATM Agreement were initially capitalized and then were offset against the initial proceeds received during the second quarter of 2024.

Net proceeds through December 31, 2024 from 1,228,227 shares sold pursuant to the ATM Agreement (net of the upfront legal, accounting and other fees), less sales commissions of $ 139,562 , were $ 4,356,188 .

Net proceeds during the year ended December 31, 2025 from 63,230 shares sold pursuant to the ATM Agreement (net of legal, accounting and other fees), less sales commissions of $ 10,489 , were $ 281,446 .

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

In June of 2017, our stockholders approved the

2017 Stock Option and Incentive Plan (the “2017 Plan”) pursuant to the provisions of the Internal Revenue Code of 1986, under

which employees and certain service providers may be granted options to purchase shares of the Company’s common stock at no less

than fair market value on the date of grant.

At that time, 300,000 shares of common stock were reserved for issuance under the 2017 Plan.

An amendment to the 2017 Plan increasing the number of shares reserved for issuance under the 2017 Plan from 300,000 shares to 650,000

shares was approved by a vote of stockholders at the Annual Meeting of Stockholders in June of 2022.

Vesting requirements are determined

by the Compensation and Stock Option Committee of the Board of Directors on a case-by-case basis.

All options granted under the 2017 Plan

expire no later than 10 years from the date of grant.

The 2017 Plan expires in March of 2027, after which date no further options can

be granted under the 2017 Plan.

However, options outstanding under the 2017 Plan at that time can be exercised in accordance with their

As of December 31, 2024 and 2023, there were 480,500 and 430,000 options outstanding under the 2017 Plan, respectively.

Activity under the stock option plans described

above was as follows:

Stock Option Plans

Under the terms of the Company's 2010 Stock Option and Incentive Plan and the 2017 Stock Option and Incentive Plan, ("the Plans"), last amended and restated in June of 2022, the Company routinely grants service-based stock options to its employees and certain service providers as share-based compensation.

While vesting requirements may be determined by the Compensation and Stock Option Committee of the Board of Directors on a case-by-case basis, the majority become exercisable after three years as long as the employee remains employed by the Company.

Stock options expire no later than 10 years from the date of grant.

There were 101,000 shares available for grant under the 2017 Plan as of December 31, 2025.

In September of 2025, the Board of Directors authorized the award of stock options, in two separate installments, to Mr.

te Boekhorst as a material inducement to accept employment by the Company as President and Chief Executive Officer.

The first installment was granted to him by the Compensation and Stock Option Committee on September 16, 2025 ( concurrent with his signing an offer letter setting out preliminary terms of employment).

That award was in the form of non-qualified stock options for 75,983 shares of the Company's common stock, with an exercise price of $ 5.90 per share.

The second award is a mix of incentive stock options and non-qualified options granted by the Compensation and Stock Option Committee on November 7, 2025 under the 2025 Stock Option Plan, and was for 74,277 shares of common stock at an exercise price of $ 6.10 per share.

Neither grant of stock options is immediately exercisable, but instead will vest on the basis of continued employment, in three equal annual increments starting on the first anniversary of their respective grant dates (except that upon change in control, as defined, all then outstanding unvested equity awards, will immediately vest in full).

These two awards met the conditions of an inducement award under Nasdaq Listing Rule 5635 (c) and thus are exempt from the stockholder approval requirements under that Rule.

The Board of Directors, on November 7, 2025, adopted a new 2025 Stock Option and Incentive Plan (the "2025 Plan"), under which employees, directors and other service providers may be granted options to purchase shares of the Company's common stock at no less than fair market value on the date of grant.

At the time, 500,000 shares of common stock were reserved for issuance under the 2025 Plan.

The Board intends to submit the 2025 Plan to stockholders for approval at the 2026 Annual Meeting of Stockholders.

If for any reason the 2025 Plan is not approved by vote of the Company's stockholders within 12 months after the date of the 2025 Plan's adoption by the Board, then with limited expectations all stock options previously granted under the 2025 Plan would, by their terms and consistent with Nasdaq Listing Rules, lapse and become non-exercisable.

We recorded compensation expense pertaining to share-based awards of $ 295,871 and $ 325,551 during the years ended December 31, 2025 and 2024 , respectively.

Stock option activity during the year ended December 31, 2025, was as follows:

Contractual Term

Shares Price (in years) Value (1)

Outstanding as of December 31, 2024

664,000 $ 6.46

Terminations/forfeitures (2)

Outstanding as of December 31, 2023

288,260 $ 5.79

Terminations/forfeitures (2)

Terminated/forfeited (2)

( 135,500 ) $ 6.77

( 15,000 ) $ 4.81

Outstanding as of December 31, 2025

801,760 $ 6.20 5.61 $ ( 38,234 )

Vested as of December 31, 2024

Exercisable as of December 31, 2025

350,500 $ 7.27 3.10 $ ( 393,527 )

Vested and expected to vest as of December 31, 2024

Expected to vest as of December 31, 2025

451,260 $ 5.36 7.56 $ 355,293

Reserved for future grants

(1) Intrinsic value is the difference between the fair market

value of the underlying common stock as of the date indicated and as of the date of the option grant (which is equal to the option exercise

Intrinsic value is the difference between the fair market value of the underlying common stock as of December 31, 2025 and as of the date of the option grant (which is equal to the option exercise price).

Terminations and forfeitures are recognized when they occur.

The following table displays additional information about the stock

option plans described above:

Weighted Average

Fair Value at Grant Date

Non-vested stock options as of December 31, 2023

Non-vested stock options as of December 31, 2024

Stock options granted during the year ended December 31, 2024

Stock options that vested during the year ended December 31, 2024

Stock options that were terminated or forfeited during the year ended December 31, 2024

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

No stock options were exercised during the year

ended December 31, 2024.

During the year ended December 31, 2023, 4,000 stock options were exercised by one employee with $ 18,760 in cash.

The aggregate intrinsic value of options exercised during the year ended December 31, 2023 was $ 1,040 .

The weighted average remaining

life of the options outstanding under the 2010 Plan and the 2017 Plan as of December 31, 2024 was approximately 4 years and 10 months.

The weighted average remaining life of the options exercisable under these plans as of December 31, 2024 was approximately 2 years and

The exercise price of the options outstanding under these plans as of December 31, 2024, ranged from $ 3.60 to $ 10.04 per share.

The 86,000 stock options granted during the year ended December 31, 2024 had an average exercise price of $ 3.91 per share.

stock options granted during the year ended December 31, 2023 had an average exercise price of $ 5.16 per share.

The weighted-average grant

date fair values of options granted during the years ended December 31, 2024 and 2023 were $ 1.84 and $ 2.80 per share, respectively.

of December 31, 2024, total unrecognized stock-based compensation related to non-vested stock options aggregated $ 365,124 which will be

recognized over a weighted average remaining period of approximately 1 year and 3 months.

The fair value of each stock option grant has

been estimated on the date of grant using the Black-Scholes option pricing model, for the purpose discussed in Note 2(n), with the following

weighted-average assumptions:

As of December 31, 2025, total unrecognized share-based compensation expense related to stock options was $ 875,883 , which will be recognize over a weighted-average remaining term of 1.94 years.

The aggregate intrinsic value of options exercised during the year ended December 31, 2025 was insignificant.

There were no stock options exercised during the year ended December 31, 2024.

The fair value of each stock option grant has been estimated on the date of grant using the Black-Scholes option pricing model.

We may use different assumptions for options granted throughout the year since the assumptions may vary based on the grant date.

The following table presents the weighted-averages of the assumptions used for grants within each year:

During the Years

1 unchanged sentence

Risk-free interest rate (1)

3.81 % 3.77 %

Dividend yield (2)

Expected volatility (2)

Expected life (3) 4.6 years 6.2 years

Expected life in years (3)

The risk-free interest rate is based on U.S.

Treasury yields

for a maturity approximating the expected option term.

(2) The dividend yield and expected volatility are derived from

averages of our historical data.

(3) The expected life is calculated utilizing the simplified

method, which uses the mid-point between the vesting period and the contractual term as the expected life.

Common Stock Rights Plan

In September of 1995, our Board of Directors

adopted a Common Stock Rights Plan (the “Rights Plan”) and declared a dividend of one common share purchase right (a “Right”)

for each of the then outstanding shares of the common stock of the Company.

Each Right entitled the registered holder to purchase from

the Company one share of common stock at an initial purchase price of $ 70.00 per share, subject to adjustment.

The description and terms

of the Rights were set forth in a Rights Agreement between the Company and Equiniti Trust Company, LLC, as Rights Agent.

At various times

over the years, our Board of Directors, which has the authority to amend the Rights Plan, voted to authorize amendments to the Rights

Plan to extend the expiration date of the Rights Plan.

During 2024, our Board of Directors determined not to further extend the Rights

Plan because these plans are generally considered not to be stockholder friendly.

With no further extension, the Rights Plan expired as

of September 19, 2024.

No shares were issued under Rights Plan while it was in effect.

primarily offer the First Defense Ò product

line to dairy and beef producers to prevent scours in newborn calves.

Generally, our products are promoted to veterinarians as well as

dairy and beef producers by our sales team and then sold through distributors.

Our primary market is North America.

We do sell into select

international regions and may expand this international reach in the future.

There were no material changes between the allocation and

timing of revenue recognition during the years ended December 31, 2024 or 2023.

We do not have any contract assets for which we have satisfied

the performance obligations, but do not yet have the right to bill for, or contract liabilities such as customer advances.

All trade receivables

on our balance sheets are from contracts with customers.

We incur no material costs to obtain contracts.

The following table presents our product sales

disaggregated by geographic area:

Treasury yields for a maturity approximating the expected option term.

The dividend yield and expected volatility are derived from averages of our historical data.

The expected life is calculated for the Company's "plain vanilla" stock options utilizing the simplified method, which uses the mid-point between the vesting period and the contractual term as the expected life.

The weighted-average grant date fair value per share for December 31, 2025 and 2024 was $ 3.13 and $ 1.84 , respectively.

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

We primarily offer the First Defense ® product line to dairy and beef producers to prevent scours in newborn calves.

This line offers two distinct platforms:

i) veterinary biologics providing scours protection with USDA-approved claims against E.coli , coronavirus and rotavirus and ii) functional feed products delivering concentrated bioactive colostrum proteins.

Generally, our products are promoted to veterinarians as well as dairy and beef producers by our sales team and then sold through distributors.

We have determined that each unit within each purchase order we receive from our customers is distinct, can be used on its own, and is not combined with another promise.

As such, each unit constitutes a distinct performance obligation.

The transaction price is determined based on the pricing noted within each written contract or provided to customers via standard price lists and with payments typically due in full within 30 days of invoicing.

Our contracts do not include significant financing components.

We recognize revenue at a point in time, when we invoice at shipment, which is when the customer assumes legal title and we have the right to payment.

There were no material changes between the allocation and timing of revenue recognition during the years ended December 31, 2025 or 2024.

The following table presents our product sales disaggregated by geographic area:

During the Years Ended December 31,

United States

Total Product Sales

The following table presents our product sales disaggregated

by major product category:

During the Years Ended December 31,

Defense ® product line

Other animal health

$ 24,391,664 88 % $ 22,893,721 86 %

3,252,510 12 % 3,599,448 14 %

Total Product Sales

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

$ 27,644,174 100 % $ 26,493,169 100 %

All trade receivables on our balance sheet date are from contracts with customers.

As of January 1, 2024, trade accounts receivable (all of which relates to contracts with customers) totaled $ 2,185,383 .

We do not have any contract assets for which we have satisfied the performance obligation, but do not yet have the right to payment.

We do not have any contract liabilities such as upfront customer payments or deferred revenue.

We incur no material costs to obtain or fulfill contracts with customers.

OTHER EXPENSES, NET

3 unchanged sentences

Interest expense (1)

$ 493,384 $ 568,725

Loss on disposal of property, plant and equipment

106,350 15,391

Impairment charge related to property plant and equipment (2)

Interest income

( 158,709 ) ( 77,702 )

Insurance recoveries (3)

( 426,587 ) —

Income - other

Other expenses (income), net

(1) Interest expense includes amortization of debt issuance and

debt discount costs of $ 42,666 and $ 22,619 during the years ended December 31, 2024 and 2023, respectively.

(2) The income from insurance recoveries resulted from claim

benefits paid to us under our business interruption policy related to product contamination losses (in the amount of $ 250,000 ) and a

recovery from a vendor’s policy related to an equipment malfunction (in the amount of $ 115,127 ).

Our income tax expense aggregated $ 10,056 and $ 4,627

(amounting to less than 1 % of our loss before income taxes) during the years ended December 31, 2024 and 2023, respectively.

As of December

31, 2024, we had federal net operating loss carryforwards of $ 17,647,250 of which $ 15,935,343 do not expire and of which $ 1,711,907 expire

in 2034 through 2037 (if not utilized before then) and state net operating loss carryforwards of $ 5,194,515 that expire in 2037 through

2038 (if not utilized before then).

Additionally, we had federal general business tax credit carryforwards of $ 842,565 that expire in

2027 through 2042 (if not utilized before then) and state tax credit carryforwards of $ 777,459 that expire in 2025 through 2042 (if not

utilized before then).

The provision for income taxes is determined using

the asset and liability approach of accounting for income taxes.

Under this approach, deferred taxes represent the estimated future tax

effects of temporary differences between book and tax treatment of assets and liabilities and carryforwards to the extent they are realizable.

During the second quarter of 2018, we assessed our historical and near-term future profitability and recorded $ 563,252 in non-cash income

tax expense to create a full valuation allowance against our net deferred tax assets (which consist largely of net operating loss carryforwards

and federal and state credits) based on applicable accounting standards and practices.

At that time, we had incurred a net loss for six

consecutive quarters, had not been profitable on a year-to-date basis since the nine-month period ended September 30, 2017 and projected

additional net losses for some period going forward before returning to profitability.

Should future profitability be realized at an adequate

level, we would be able to release this valuation allowance (resulting in a non-cash income tax benefit) and realize these deferred tax

assets before they expire.

We will continue to assess the need for the valuation allowance at each quarter and, in the event that actual

results differ from these estimates, or we adjust these estimates in future periods, we may need to adjust our valuation allowance.

we adjust the valuation allowance at the end of each quarter to reduce the value of our deferred tax assets to zero .

Net operating loss carryforwards, credits, and other

tax attributes are subject to review and possible adjustment by the Internal Revenue Service.

Section 382 of the Internal Revenue Code

contains provisions that could place annual limitations on the future utilization of net operating loss carryforwards and credits in the

event of a change in ownership of the Company, as defined.

We file income tax returns in the U.S.

federal jurisdiction

and several state jurisdictions.

We currently have no tax examinations in progress.

We also have not paid additional taxes, interest or

penalties as a result of tax examinations nor do we have any unrecognized tax benefits for any of the periods in the accompanying audited

financial statements.

Other expenses, net

$ 2,677,762 $ 506,414

Interest expense includes amortization of debt issuance and debt discount costs of $ 54,348 and $ 42,666 during the years ended December 31, 2025 and 2024 , respectively.

During the year ended December 31, 2025, we determined that certain machinery previously assigned to the Re-Tain ® business no longer had a future use to the Company or any specific undiscounted cash flows other than estimated proceeds from the expected sale.

As a result, we recognized an impairment charge on the machinery to write-down their cost to their estimated fair value.

( 3 ) The income from insurance recoveries resulted from claim benefits paid to us under our business interruption policy related to inventory product losses occurring in previous periods.

Our income tax expense aggregated $ 11,570 and $ 10,056 (amounting to 1 % and less than 1 % of our loss before income taxes) during the years ended December 31, 2025 and 2024 , respectively.

As of December 31, 2025 , we had federal net operating loss carryforwards of $ 17,496,754 of which $ 16,055,226 do not expire and of which $ 1,441,528 expire in 2034 through 2037 (if not utilized before then) and state net operating loss carryforwards of $ 7,670,528 of which $ 7,513,712 do not expire and of which $ 156,816 expire in 2037 through 2038 (if not utilized before then).

Additionally, we had federal general business tax credit carryforwards of $ 901,466 that expire in 2028 through 2045 (if not utilized before then) and state tax credit carryforwards of $ 745,316 that expire in 2031 through 2039 (if not utilized before then).

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

The income tax provision consisted of the following:

The provision for income taxes is determined using the asset and liability approach of accounting for income taxes.

Under this approach, deferred taxes represent the estimated future tax effects of temporary differences between book and tax treatment of assets and liabilities and carryforwards to the extent they are realizable.

During the second quarter of 2018, we assessed our historical and near-term future profitability and recorded $ 563,252 in non-cash income tax expense to create a full valuation allowance against our net deferred tax assets (which consist largely of net operating loss carryforwards and federal and state credits) based on applicable accounting standards and practices.

At that time, we had incurred a net loss for six consecutive quarters, had not been profitable on a year-to-date basis since the nine -month period ended September 30, 2017 and projected additional net losses for some period going forward before returning to profitability.

Should future profitability be realized at an adequate level, we would be able to release this valuation allowance (resulting in a non-cash income tax benefit) and realize these deferred tax assets before they expire.

We will continue to assess the need for the valuation allowance at each quarter and, in the event that actual results differ from these estimates, or we adjust these estimates in future periods, we may need to adjust our valuation allowance.

Currently, we adjust the valuation allowance at the end of each quarter to reduce the value of our deferred tax assets to zero.

Net operating loss carryforwards, credits, and other tax attributes are subject to review and possible adjustment by the Internal Revenue Service.

Section 382 of the Internal Revenue Code contains provisions that could place annual limitations on the future utilization of net operating loss carryforwards and credits in the event of a change in ownership of the Company, as defined.

We file income tax returns in the U.S.

federal jurisdiction and several state jurisdictions.

We currently have no tax examinations in progress.

We also have not paid additional taxes, interest or penalties as a result of tax examinations nor do we have any unrecognized tax benefits for any of the periods in the accompanying financial statements.

As described in Note 2, "Basis of Presentations and Use of Estimates and Significant Accounting Policies", additional disclosures below are presented pursuant to the requirements of ASU 2023 - 09.

Amounts as of and for the year ended December 31, 2024, where applicable, were recast to conform with the year ended December 31, 2025, presentation.

The income tax expense consisted of the following:

During the Years

Ended December 31,

11,570 10,056

Current subtotal

11,570 10,056

( 220,758 ) ( 500,927 )

( 111,888 ) ( 59,032 )

Deferred subtotal, gross

1 unchanged sentence

Valuation allowance

332,646 559,959

Deferred subtotal, net

Income tax expense

The actual income tax expense differs from the

expected tax computed by applying the U.S.

federal corporate tax rate of 21 % to the loss before income taxes during the years ended December

31, 2024 and 2023 respectively, as follows:

the Years Ended December 31,

Computed expected income tax expense rate

$ 11,570 $ 10,056

The components of loss before taxes are as follows:

During the Years

Ended December 31,

$ ( 1,028,457 ) $ ( 2,146,573 )

State income taxes, net of federal expense

Loss before income taxes

$ ( 1,028,457 ) $ ( 2,146,573 )

Income taxes paid, net of refunds received, by jurisdiction consists of the following:

During the Years

Ended December 31,

State and Local — California

State and Local — Michigan

State and Local — Minnesota

State and Local — New York

State and Local — Pennsylvania

State and Local — Texas

State and Local — Other

State and Local

International — Other

International

Total income taxes paid

$ 10,691 $ 7,293

ImmuCell Corporation

Notes to Audited Financial Statements (continued)

The following table reconciles income tax expense computed at the federal statutory rate with income tax expense as reported by category.

Additionally, categories of at least 5% of the expected tax expense are disaggregated by nature or jurisdiction:

During the Years Ended December 31,

Amount Percent Amount Percent

Computed tax at Federal Statutory Rate (21%)

$ ( 215,976 ) ( 21.00 )% $ ( 450,780 ) ( 21.00 )%

State and local income taxes, net of federal benefit (1)

( 79,693 ) ( 7.75 )% ( 36,681 ) ( 1.71 )%

Foreign tax effects

— 0.00 % — 0.00 %

Effect of changes in tax laws/rates

— 0.00 % — 0.00 %

Effect of cross-border tax laws

— 0.00 % — 0.00 %

Research and experimental tax credits

( 58,901 ) ( 5.73 )% ( 116,091 ) ( 5.41 )%

Changes in valuation allowance

332,646 32.34 % 559,959 26.09 %

Nontaxable/nondeductible items

5,280 0.51 % 4,619 0.22 %

Share-based compensation

Valuation allowance

Income tax expense/rate

The significant components of our deferred tax

assets, net, consisted of the following:

Property, plant and equipment

28,214 2.75 % 49,030 2.28 %

Changes in unrecognized tax benefits

— 0.00 % — 0.00 %

Income tax expense

$ 11,570 1.12 % $ 10,056 0.47 %

( 1 ) State taxes in California, New York, Pennsylvania, and Minnesota made up the majority of the tax effect in this category.

The following table presents qualitative disclosure of state and local income taxes, net of federal benefit:

During the Years Ended December 31,

$ ( 16,720 ) 20.98 % $ ( 17,422 ) 47.50 %

— 0.00 % ( 6,456 ) 17.60 %

( 7,070 ) 8.87 % — 0.00 %

( 15,018 ) 18.85 % ( 7,158 ) 19.51 %

( 16,164 ) 20.28 % ( 5,364 ) 14.62 %

( 26,380 ) 33.10 % ( 6,187 ) 16.87 %

1,659 (2.08) % 5,906 (16.10) %

State and local income taxes, net of federal benefit

$ ( 79,693 ) 100.00 % $ ( 36,681 ) 100.00 %

The significant components of our deferred tax assets, net, consisted of the following:

Property, plant and equipment

$ ( 950,593 ) $ ( 1,833,727 )

Federal general business tax credits

901,466 842,565

Federal net operating loss carryforwards

3,674,316 3,705,923

State tax credits and net operating loss carryforwards

927,108 900,569

§174 R & D expenditures

39,034 727,410

Deferred compensation

52,872 82,370

Prepaid expenses and other

74,110 24,718

54,047 22,443

Incentive compensation

Valuation allowance

154,275 121,718

Valuation allowance

( 4,926,635 ) ( 4,593,989 )

3 unchanged sentences

SEGMENT INFORMATION

Our business operations (being the development,

manufacture and sale of products that improve the health and productivity of dairy and beef cattle) are described in Note 1.

to Codification Topic 280, Segment Reporting , we operate in the following two reportable business segments:

i) Scours and ii) Mastitis.

The Scours segment consists of the First Defense ® product line.

The core technology underlying the Scours segment

is focused on polyclonal antibodies.

The Mastitis segment includes our products, CMT and Re-Tain ® .

is projected to be the driver of this segment when approved for sale.

The core technology underlying the Mastitis segment is

focused on a bacteriocin called Nisin.

The category we define as “Other” includes unallocated administrative and overhead

expenses and other products.

The significant accounting policies of these segments are described in Note 2.

Product sales are the primary

factor we use in determining our reportable segments.

The governing regulatory authority (Center for Veterinary Biologics, U.S.

of Agriculture for First Defense ® or Center for Veterinary Medicine, U.S.

Food and Drug Administration for Re-Tain ® )

is also a factor in determining our reportable segments.

Management monitors and evaluates segment performance from sales to net operating

income (loss) closely.

We are not organized by geographic region.

No segments have been aggregated.

The revenues and expenses allocated

to each segment are in some cases direct and in other cases involve reasonable and consistent estimations by management.

Each operating

segment is defined as the component of our business for which financial information is available and evaluated regularly by our chief

operating decision-maker in deciding how to allocate resources and in assessing performance.

Our chief operating decision-maker is our

President and CEO.

Our business operations (being the development, manufacture and sale of products that improve the health and productivity of dairy and beef cattle) are described in Note 1, "The Company and Nature of Operations".

Our chief operating decision-maker (CODM), our President and CEO, regularly evaluates two operating segments:

i) Scours and ii) Mastitis for purposes of deciding how to allocate resources and assess performance.

Our CODM primarily evaluates performance based on product sales as well as net operating income (loss).

No operating segments have been aggregated;

therefore, our two operating segments are the Company's two reportable segments.

Scours segment - consists of the First Defense ® product line.

The core technology underlying the Scours segment is focused on polyclonal antibodies.

Mastitis segment - includes our CMT product line, consisting of reagents and equipment used for rapid cow-side testing to identify mastitic quarters by detecting elevated somatic cell counts.

This segment also includes our Re-Tain ® product in development for the treatment of subclinical mastitis based on the bacteriocin nisin.

On December 23, 2025, we made the decision to cease our focus on obtaining FDA approval of Re-Tain ® and instead continue the stability and investigational testing related to Re-Tain ® .

Other - includes unallocated administrative and overhead expenses and other products.

The revenues and expenses allocated to each segment are in some cases direct and in other cases involve reasonable and consistent estimations by management.

The significant accounting policies of these segments are the same as those described in Note 2, "Basis of Presentation and Use of Estimates and Significant Accounting Policies".

During the Year Ended December 31, 2025

Product sales

$ 27,447,786 $ 196,388 $ — $ 27,644,174

Costs of goods sold

16,029,844 169,127 — 16,198,971

11,417,942 27,261 — 11,445,203

Product development expenses

362,548 2,559,849 119,483 3,041,880

Sales and marketing expenses

3,164,951 388,424 — 3,553,375

Administrative expenses

Operating expenses

NET OPERATING INCOME (LOSS)

— — 3,200,643 3,200,643

Operating expenses

3,527,499 2,948,273 3,320,126 9,795,898

NET OPERATING INCOME (LOSS)

$ 7,890,443 $ ( 2,921,012 ) $ ( 3,320,126 ) $ 1,649,305

the Year Ended December 31, 2023

During the Year Ended December 31, 2024

Product sales

$ 26,314,251 $ 178,918 $ — $ 26,493,169

Costs of goods sold

18,382,949 169,176 — 18,552,125

7,931,302 9,742 — 7,941,044

Product development expenses

243,578 3,493,298 161,706 3,898,582

Sales and marketing expenses

2,909,799 556,273 — 3,466,072

Administrative expenses

Operating expenses

NET OPERATING INCOME (LOSS)

— — 2,216,549 2,216,549

Operating expenses

3,153,377 4,049,571 2,378,255 9,581,203

NET OPERATING INCOME (LOSS)

$ 4,777,925 $ ( 4,039,829 ) $ ( 2,378,255 ) $ ( 1,640,159 )

Total Assets as of December 31, 2025 (1)

$ 38,245,418 $ 134,138 $ 4,152,891 $ 42,532,447

Total Assets as of December 31, 2024

$ 24,644,294 $ 16,523,048 $ 3,933,135 $ 45,100,477

Depreciation and amortization expense during the year ended December 31, 2025

$ 1,458,046 $ 1,256,656 $ 69,247 $ 2,783,949

Depreciation and amortization expense during the year ended December 31, 2024

$ 1,373,815 $ 1,277,218 $ 78,814 $ 2,729,847

Capital Expenditures during the year ended December 31, 2025

$ 1,168,428 $ 74,883 $ 7,128 $ 1,250,439

Capital Expenditures during the year ended December 31, 2024

$ 409,696 $ 53,721 $ 2,308 $ 465,725

( 1 ) As of December 31, 2025, property, plant and equipment, net includes approximately $ 12,300,000 of idle assets, which primarily related to one of our manufacturing facilities that was previously utilized for Re-Tain ® that we now plan to refit for use in producing First Defense ® products.

We are not organized by geographic region.

ImmuCell Corporation

1 unchanged sentence

RELATED PARTY TRANSACTIONS

Tomsche (Chair of our Board of Directors) is a controlling owner of Leedstone Inc., a domestic distributor of our products (the First

Defense Ò product

line and CMT ).

His affiliated company purchased $ 567,114 and $ 231,405 of products from us during the years ended December 31, 2024

and 2023, respectively, all on terms consistent with those offered to other distributors of similar status.

Our accounts receivable (subject

to standard and customary payment terms) due from this affiliated company aggregated $ 52,097 and $ 42,507 as of December 31, 2024 and 2023,

respectively.

Tomsche (Chair of our Board of Directors) is a controlling owner of Leedstone Inc., a domestic distributor of our products (the First Defense ® product line and CMT).

His affiliated company purchased $ 802,407 and $ 567,114 of products from us during the years ended December 31, 2025 and 2024 , respectively, all on terms consistent with those offered to other distributors of similar status.

Our accounts receivable (subject to standard and customary payment terms) due from this affiliated company aggregated $ 0 and $ 52,097 as of December 31, 2025 and 2024 , respectively.

EMPLOYEE BENEFITS

We have a 401(k) savings plan (the Plan) in which

all employees completing one month of service with the Company are eligible to participate.

Participants may contribute up to the maximum

amount allowed by the Internal Revenue Service.

We currently match 100 % of the first 3 % of each employee’s salary that is contributed

to the Plan and 50 % of the next 2 % of each employee’s salary that is contributed to the Plan.

Under this matching plan, we paid

$ 203,756 and $ 178,150 into the Plan for the years ended December 31, 2024 and 2023, respectively.

We have a 401 (k) savings plan (the Plan) in which all employees completing one month of service with the Company are eligible to participate.

Participants may contribute up to the maximum amount allowed by the Internal Revenue Service.

We currently match 100 % of the first 3 % of each employee’s salary that is contributed to the Plan and 50 % of the next 2 % of each employee’s salary that is contributed to the Plan.

Under this matching plan, we paid $ 189,398 and $ 203,756 into the Plan for the years ended December 31, 2025 and 2024 , respectively.

SUBSEQUENT EVENTS

We have evaluated subsequent events through the

time of this filing on March 28, 2025.

First, in January of 2025, we settled a long outstanding insurance claim related to previously

disclosed contamination events in our production process incurred from late 2022 through April of 2024.

As a result of the settlement,

we received $ 426,587 during January of 2025, which is in addition to the $ 250,000 that was previously received on this claim and recognized

for financial statement purposes during the third quarter of 2023.

Second, net proceeds from January 1, 2025 through March 21, 2025 from

3,532 shares sold pursuant to our ATM Agreement (less sales commissions of $ 584 ) were $ 18,849 .

As of the time of this filing on March

28, 2025, there were no additional material, reportable subsequent events.

Pursuant to the requirements of Section 13 or 15(d)

of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto

duly authorized.

We have evaluated subsequent events through the time of this filing on the date we have issued this Annual Report on Form 10 -K.

Employee Compensation

Effective as of January 27, 2026, the Company entered into new employment agreements with Timothy C.

Fiori, the Company’s Chief Financial Officer, and Bobbi Jo Brockmann, the Company’s Senior Vice President of Sales and Marketing.

Pursuant to the new employment agreements, Mr.

Fiori will be compensated at an annual base salary of $ 315,000 and Ms.

Brockmann will be compensated at an annual base salary of $ 300,000 .

Starting with the fiscal year ending December 31, 2026, each of Mr.

Fiori and Ms.

Brockmann will be eligible to earn a formulaic annual cash bonus if various preset financial and strategic targets are achieved.

The target cash bonus amount is 50 % of base salary (potentially 60 % if all targets are exceeded by at least 20 %).

The financial and strategic targets for 2026 were approved by the Compensation and Stock Option Committee of the Company’s Board of Directors (the “Committee”).

Per the employment agreements, the annual financial and strategic targets thereafter will be set each year by the Company’s CEO in consultation with the Committee;

for targets that are qualitative in nature, the extent to which the qualitative target was achieved is to be determined each year by the Committee.

As with other incentive-based compensation, payouts of annual cash bonuses are subject to possible retroactive clawback if and to the extent mandated by Company policy or applicable laws or listing requirements.

Stock Option Plans

In connection with the employment agreements described above, the Committee also approved grants under the "2025 Plan" of a stock option to Mr.

Fiori to purchase up to 120,000 shares of the Company’s common stock and a stock option to Ms.

Brockmann to purchase up to 100,000 shares of the Company’s common stock.

Both options vest in three equal annual installments starting in January of 2027, are exercisable at a price of $ 6.26 per share, and expire 10 years from the date of grant.

Consistent with the new employment agreements for these officers, vesting of each stock option is subject to potential acceleration upon a change of control or certain terminations of employment.

Effective as of January 27, 2026, the Committee issued a Compensation Letter to Olivier te Boekhorst, the Company’s CEO, which included a grant to Mr.

te Boekhorst under the 2025 Plan of a performance-based stock option to purchase up to 110,000 shares of the Company’s stock.

The option vests only if and when the Company’s net operating income for four consecutive calendar quarters equals or exceeds 300 % of the Company’s audited net operating income for its 2025 fiscal year, is exercisable at a price of $ 6.26 per share, and expires 10 years from the date of grant.

Consistent with Mr.

te Boekhorst’s employment agreement with the Company, vesting of this performance stock option is subject to potential acceleration upon a change of control or certain terminations of employment.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

ImmuCell Corporation

March 30, 2026

/s/ Michael F.

Brigham President, Chief Executive Officer and Principal Financial Officer

/s/ Timothy C.

Fiori, Chief Financial Officer and Principal Financial Officer

POWER OF ATTORNEY

We, the undersigned directors and employees of ImmuCell

Corporation, hereby severally constitute and appoint Michael F.

Brigham our true and lawful attorney-in-fact and agent with full power

of substitution and re-substitution, for us and in our stead, in any and all capacities, to sign any and all amendments to this report

and all documents relating thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with

the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each

and every act and thing necessary or advisable to be done in and about the premises, as fully to all intents and purposes as he might

or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitute or substitutes, may

lawfully do or to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange

Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates

We, the undersigned directors and employees of ImmuCell Corporation, hereby severally constitute and appoint Timothy C.

Fiori our true and lawful attorney-in-fact and agent with full power of substitution and re-substitution, for us and in our stead, in any and all capacities, to sign any and all amendments to this report and all documents relating thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing necessary or advisable to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Gloria J.

1 unchanged sentence

/s/ Michael F.

President, Chief Executive Officer,

March 30, 2026

Principal Financial Officer and Director

/s/ Bobbi Jo Brockmann

Vice President of Sales and Marketing and Director

Senior Vice President of Sales and Marketing and Director

March 30, 2026

Bobbi Jo Brockmann

/s/ Timothy C.

Chief Financial Officer and Director

March 30, 2026

/s/ Steven T.

March 30, 2026

/s/ Olivier te Boekhorst

President, Chief Executive Officer, and Director

March 30, 2026

Olivier te Boekhorst

March 30, 2026

/s/ Elizabeth S.

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-K

Item 9A. Controls and Procedures