What changed in this filing

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Item 1. Financial Statements

2026-07-31 compared with 2025-11-14 · 524 added, 2863 removed, 156 unchanged (96% of the section changed)

Financial Statements

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

OLENOX INDUSTRIES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

Current assets:

2 unchanged sentences

Contract assets 103,736 —

Inventories 329,978 329,978

Prepaid expenses and other current assets 447,039 383,439

Total current assets 1,216,918 1,458,525

Oil and gas, on the basis of full cost accounting, net

Non-current assets:

Oil and gas assets, on the basis of full cost accounting, net 3,923,164 4,004,589

Property, plant and equipment, net 4,672,024 4,730,505

Other non-current assets

Proved oil and gas reserves

Project development costs and other non-current assets 340,744 349,348

Right of use assets, net 218,934 309,013

Intangible assets, net 5,579,563 5,734,298

Investment in and advances to equity affiliates

Liabilities and Stockholders’ Equity (Deficit)

Goodwill 17,449,429 17,449,429

Certificate of deposit 2,000,000 2,000,000

Total non-current assets 34,183,858 34,577,182

Total Assets $ 35,400,776 $ 36,035,707

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable and accrued expenses $ 12,750,723 $ 12,068,509

Contract liabilities

Contract liabilities and deferred revenues 945,964 924,076

Lease liability, current maturities 179,476 138,217

Due to affiliates 1,242,772 1,498,205

Lines of credit 2,001,667 2,001,667

Derivative liabilities 72,157 70,802

Convertible notes payable 1,125,000 1,035,581

Current portion of long-term debt 4,866,664 4,866,664

Short-term notes payable, net 1,464,612 3,204,175

Total current liabilities 24,649,035 25,807,896

Long-term liabilities:

Long-term notes payable, net 636,904 610,336

Right-of-use liability 56,501 179,649

Asset retirement obligations 1,871,180 1,848,080

Total long-term liabilities 2,564,585 2,638,065

Total liabilities 27,213,620 28,445,961

Stockholders’ equity (deficit):

Commitments and contingencies (Note 11)

Stockholders’ equity:

Series A Preferred stock, $ 1.00 par value, 5,405,010 shares authorized;

3,848,640 and 0 issued and outstanding at September 30, 2025 and December 31, 2024, respectively

3,809,640 and 3,848,640 issued and outstanding at March 31, 2026 and December 31, 2025, respectively 3,809,640 3,848,640

Series B Preferred stock, $ 1.00 par value, 60,000 shares authorized;

60,000 and 0 issued and outstanding at September 30, 2025 and December 31, 2024, respectively

2,084 and 2,084 issued and outstanding at March 31, 2026 and December 31, 2025, respectively 2,084 2,084

Series C Preferred stock, $ 1.00 par value, 50,000 shares authorized;

4,589 and 4,500 issued and outstanding at March 31, 2026 and December 31, 2025, respectively 4,589 4,500

Common stock, $ 0.01 par value, 75,000,000 shares authorized;

763,434 issued and 763,382 outstanding as of September 30, 2025 and 99,829 issued and 94,350 outstanding as of December 31, 2024

1,000,352 issued and 1,000,347 outstanding as of March 31, 2026 and 646,796 issued and 646,791 outstanding as of December 31, 2025, respectively 10,002 6,467

Additional paid-in capital 124,471,234 121,172,724

Common stock to be issued

Treasury stock, at cost 3,371 shares as of September 30, 2025 and December 31, 2024

Treasury stock, at cost, 5 shares as of March 31, 2026 and December 31, 2025 ( 92,396 ) ( 92,396 )

Accumulated deficit ( 120,017,997 ) ( 117,352,273 )

( 111,168,493 )

( 98,532,083 )

Total stockholders’ equity (deficit)

( 12,460,308 )

Total Liabilities and Stockholders’ Equity (Deficit)

The accompanying notes are an integral

part of these condensed consolidated financial statements.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Total stockholders’ equity 8,187,156 7,589,746

Total Liabilities and Stockholders’ Equity $ 35,400,776 $ 36,035,707

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

OLENOX INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

September 30,

Construction services

Cost of revenue:

Construction services

Gross (loss) profit

( 1,626,395 )

FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

Revenues, net $ 285,313 $ 566,354

Cost of revenues 486,146 890,109

Gross loss ( 200,833 ) ( 323,755 )

Operating expenses:

2 unchanged sentences

Marketing and business development expenses 81,409 6,916

Total operating expenses 2,682,281 1,508,227

Operating loss ( 2,883,114 ) ( 1,831,982 )

( 2,507,726 )

( 2,241,085 )

( 8,027,488 )

( 5,021,927 )

Other income (expense):

Interest expense

( 2,092,176 )

( 2,404,277 )

Interest expense, net ( 365,757 ) ( 603,126 )

Loss on debt extinguishment ( 613,723 ) —

Gain on debt extinguishment 1,197,449 —

Change in fair value of derivatives ( 1,355 ) —

Change in fair value of equity-based investment — ( 311,560 )

( 5,590,666 )

Loss on disposition of equity-based investment

Loss on conversion of notes payable

( 4,915,209 )

Interest income

( 2,808,146 )

( 1,475,020 )

( 4,608,922 )

( 8,119,147 )

Other income 776 —

Total 217,390 ( 914,686 )

Loss before income taxes ( 2,665,724 ) ( 2,746,668 )

( 5,315,872 )

( 3,716,105 )

( 12,636,410 )

( 13,141,074 )

Income tax expense — —

Loss from continuing operations

( 5,315,872 )

( 3,716,105 )

( 12,636,410 )

( 13,141,074 )

Income from discontinued operations

( 5,315,872 )

( 3,716,105 )

( 12,636,410 )

( 10,456,396 )

Common stock deemed dividend – reduction in conversion rate

Common stock deemed dividend - inducement

( 1,162,436 )

Net loss ( 2,665,724 ) ( 2,746,668 )

Deemed dividend for preferred shareholders ( 395,967 ) —

Net loss attributable to common stockholders $ ( 3,061,691 ) $ ( 2,746,668 )

$ ( 5,315,872 )

$ ( 3,716,105 )

$ ( 12,636,410 )

$ ( 12,094,545 )

Net loss per share

Basic and diluted – continuing operations

Basic and diluted – discontinuing operations

Basic and diluted – total

Weighted average shares outstanding:

Basic and diluted

The accompanying notes are an integral part

of these condensed consolidated financial statements.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Condensed Consolidated Statements of Changes

in Stockholders’ Equity (Deficit) (Unaudited)

For The Three and Nine Months Ended September

30, 2025 and 2024

$1.00 Par Value

Preferred Stock

$1.00 Par Value

Net loss per share - basic and diluted $ ( 4.38 ) $ ( 286.83 )

Weighted average shares outstanding - basic and diluted 698,387 9,576

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

OLENOX INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

Preferred Stock

$0.01 Par Value

Stockholders’

Balance at June 30, 2025

$ 125,833,504

$ ( 105,852,621 )

Fractional share adjustment

Balance at December 31, 2025 646,791 $ 6,467 3,848,640 $ 3,848,640 2,084 $ 2,084 4,500 $ 4,500 $ 121,172,724 $ ( 92,396 ) $ ( 117,352,273 ) $ 7,589,746

Stock-based compensation 24,790 248 — — — — — — 221,818 — — 222,066

Issuance of common stock for services

Issuance of common stock – prefunded warrants

Conversion of notes payable and accrued interest

Forgiveness related party debt

Warrant to Preferred Stock Exchange

( 5,315,872 )

Balance at September 30, 2025

( 111,168,493 )

$1.00 Par Value

Preferred Stock

$1.00 Par Value

Settlement of short-term notes payable 84,948 849 — — — — — — 875,206 — — 876,055

Shares issued for settlement of due to affiliates 62,333 623 — — — — — — 616,590 — — 617,213

Exchange of Series A preferred stock for common stock 58,500 585 ( 39,000 ) ( 39,000 ) — — — — 38,415 — — —

Sale of preferred stock — — — — — — 1,800 1,800 1,546,000 — — 1,547,800

Conversion of preferred stock 122,990 1,230 — — — — ( 1,711 ) ( 1,711 ) 481 — — —

Net loss — — — — — — — — — — ( 2,665,724 ) ( 2,665,724 )

Balance at March 31, 2026 1,000,352 $ 10,002 3,809,640 $ 3,809,640 2,084 $ 2,084 4,589 $ 4,589 $ 124,471,234 $ ( 92,396 ) $ ( 120,017,997 ) $ 8,187,156

Preferred Stock

$0.01 Par Value

Stockholders’

Balance at December 31, 2024 9,435 $ 94 — $ — — $ — — $ — $ 86,164,077 $ ( 92,396 ) $ ( 98,532,083 ) $ ( 12,460,308 )

$ ( 98,532,083 )

$ ( 12,460,308 )

Fractional share adjustment

Stock-based compensation 89 1 — — — — — — 106,297 — — 106,298

Issuance of stock in connection with acquisition

Forgiveness related party debt

Issuance of stock in connection with acquisition, as restated (Note 3) — — 4,000,000 4,000,000 — — — — 14,800,000 — — 18,800,000

Forgiveness of related party debt — — — — — — — — 1,275,416 — — 1,275,416

Issuance of common stock in connection with debt issuance 459 5 — — — — — — 332,044 — — 332,049

Issuance of common stock, net of issuance costs

Issuance of Common stock for services

Issuance of Common stock – prefunded warrants

Conversion of notes payable and accrued interest

Issuance of stock for accrued interest

Preferred to common conversion

Warrant to Preferred Stock Exchange

( 12,636,410 )

Balance at September 30, 2025

$ 128,898,736

$ ( 111,168,493 )

The accompanying notes are an integral part

of these condensed consolidated financial statements.

$1.00 Par Value

Preferred Stock

$0.01 Par Value Common Stock

Additional Paid-in

Noncontrolling

Stockholders’ Equity

Balance at June 30, 2024

$ ( 84,217,910 )

$ ( 5,661,777 )

Issuance of stock for accounts payable settlement

Stock-based compensation and issuance of RSU’s

Prefunded warrant exercise

( 3,716,105 )

Balance of September 30, 2024

$ ( 87,934,015 )

$ ( 8,158,926 )

Balance at December 31, 2023

$ ( 75,839,470 )

$ ( 6,243,703 )

Stock-based compensation and issuance of RSU’s

Common stock deemed dividend – inducement

( 1,162,436 )

Common stock deemed dividend – reduction in conversion rate

Cashless warrant exercise

Prefunded warrant exercise

Issuance of stock upon inducement

Issuance of common stock and warrants for debt issuance

Conversion of debt and interest

Fractional share adjustment

Issuance of common stock under EP Adjustment

Issuance of stock for accounts payable settlement

SG DevCorp equity transactions

Deconsolidation of SG DevCorp

( 1,966,848 )

Issuance of common stock

( 10,456,396 )

Balance at September

$ ( 87,934,015 )

$ ( 8,158,926 )

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Condensed Consolidated Statements

of Cash Flows

September 30,

For the Nine Months

September 30,

Net loss — — — — — — — — — — ( 2,746,668 ) ( 2,746,668 )

Balance at March 31, 2025, as restated (Note 3) 9,983 $ 100 4,000,000 $ 4,000,000 — $ — — $ — $ 102,677,834 $ ( 92,396 ) $ ( 101,278,751 ) $ 5,306,787

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

OLENOX INDUSTRIES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

Cash flows from operating activities:

Net loss from continuing operations

$ ( 12,636,410 )

$ ( 13,141,074 )

Income from discontinued operations

Net loss $ ( 2,665,724 ) $ ( 2,746,668 )

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation expense

Depreciation, depletion and amortization 171,549 92,117

Amortization of intangible assets 154,735 15,058

Issuance of stock for services

Amortization of deferred license costs

Amortization of debt issuance costs and debt discount

Amortization of right of use asset

Gain on deconsolidation – SG DevCorp

( 4,637,013 )

Loss on conversion of notes payable

Loss on disposition of equity-based investment

Change in fair value of equity-based investment

Amortization of debt issuance costs 117,487 344,763

Accretion of asset retirement obligations 23,100 —

Loss on debt extinguishment 613,723 —

Gain on debt extinguishment ( 1,197,449 ) —

Change in fair value of derivatives 1,355 —

Change in right of use asset and lease liability 8,190 ( 66,821 )

Stock-based compensation 222,066 106,298

Change in fair value of equity-based investment — 311,560

Changes in operating assets and liabilities:

1 unchanged sentence

Contract assets ( 103,736 ) 2,536

Inventories — ( 20,181 )

Prepaid expenses and other current assets ( 63,600 ) 97,795

Intangible assets

Accounts payable and accrued expenses

Lease liability

( 1,139,751 )

Contract liabilities

Project development and other assets 8,604 ( 28,439 )

Due from affiliates

Net cash used in operating activities by continuing operations

( 3,817,995 )

( 8,322,569 )

Net cash used in operating activities by discontinued operations

Accounts payable and accrued expenses 766,331 1,072,116

Contract liabilities and deferred revenues

21,888 ( 427,219 )

Due to affiliates — ( 74,586 )

Net cash used in operating activities ( 1,909,521 ) ( 1,308,920 )

Cash flows from investing activities:

Cash paid for business combination – Sherman Oil

( 1,000,000 )

Cash paid for business combination – County Line

( 1,000,000 )

Purchase of property, plant and equipment ( 31,643 ) ( 73,676 )

Cash received in business combination - NAHD

Cash received from sale of equity-based investment

Project development costs

Cash received in business combination — 77,013

Investment in equity method investment — ( 186,000 )

Net cash used in investing activities by continuing operations

( 2,468,180 )

Net cash used in investing activities by discontinued operations

Net cash used in investing activities ( 31,643 ) ( 182,663 )

Cash flows from financing activities:

Repayment of short term notes payable

( 1,358,376 )

( 5,143,298 )

Borrowings on short-term notes payable

Proceeds from warrant inducement

Prefunded warrant exercise

Issuance of common stock from EP Agreement

Issuance of common stock for cash

Net cash provided by financing activities by continuing operations

Net cash provided by financing activities by discontinued operations

Net increase in cash and cash equivalents

Proceeds from short-term notes payable and warrants, net of debt issuance costs — 1,681,592

Payment of short-term notes payable ( 3,619 ) ( 335,373 )

Cash received from sale of common and preferred stock 1,547,800 —

Net cash provided by financing activities 1,544,181 1,346,219

Net decrease in cash and cash equivalents ( 396,983 ) ( 145,364 )

Cash and cash equivalents - beginning of period 427,866 375,873

Cash and cash equivalents - end of period $ 30,883 $ 230,509

Supplemental disclosure of non-cash operating activities:

Assets and liabilities effected in deconsolidation

Assets held for sale

Prepaid expenses and other current assets

Property and equipment, net

Project development costs and other assets

Intangible assets

Investments in equity-based investments

Accounts payable and accrued expenses

Contingent consideration payable

Short-term notes payable

Cashless warrant exercise

Fractional common share adjustment

Common stock deemed dividend – warrant inducement

Common stock deemed dividend – conversion rate change

Conversion of short-term notes payable to common stock

Fair value of warrants issued with debt

Common stock issuance for accounts payable adjustment

Supplemental disclosure of cash flow information:

Interest paid $ 137,424 $ —

Income taxes paid $ — $ —

Supplemental disclosure of non-cash investing and financing activities:

Forgiveness of related party debt and investment $ — $ 1,275,416

Common stock and warrants issued for debt

Common stock issued for conversion of accrued interest – related party

Common stock issued for conversion of preferred stock

Conversions of notes payable to common stock

Warrant to preferred stock exchange

The accompanying notes are an integral part

of these condensed consolidated financial statements.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Common stock and warrants issued for debt issuance $ — $ 332,049

Shares issued for settlement of short-term notes payable $ 1,738,323 $ —

Settlement of due to affiliates and accrued interest $ 339,550 $ —

Exchange of Series A preferred stock for common stock $ 39,000 $ —

Conversion of preferred stock $ 1,711 $ —

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

OLENOX INDUSTRIES INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

DESCRIPTION OF BUSINESS

Safe & Green Holdings Corp.

(collectively

with its subsidiaries, the “Company,” “we”, “us” or “our”) was previously known as

SG Blocks, Inc.

as well as CDSI Holdings, Inc., a Delaware corporation incorporated on December 29, 1993.

On November 4, 2011, CDSI Merger

Sub, Inc., the Company’s wholly-owned subsidiary, was merged with and into SG Building Blocks, Inc.

(“SG Building,”

formerly SG Blocks Inc.) (the “Merger”), with SG Building surviving the Merger and becoming a wholly-owned subsidiary of the

The Merger was a reverse merger that was accounted for as a recapitalization of SG Building, as SG Building was the accounting

On February 2, 2025, the Company entered

into an Agreement and Plan of Merger (the “Merger Agreement”) by and between the Company and New Asia Holdings, Inc., a Nevada

corporation (“NAHD”), pursuant to which NAHD will be merged into a to-be-formed subsidiary of the Company (the “Merger”).

Following the Merger, NAHD and its operating subsidiaries will be indirect, wholly owned subsidiaries of the Company.

As merger consideration,

the Company will issue four million ( 4,000,000 ) shares of Series A non-voting convertible preferred shares of the Company, par value $ 1.00

(the “Preferred Shares”), to NAHD’s shareholders, with each Preferred Share having the right to convert into fifteen

(15) shares of common stock of the Company, provided, however, that any such conversion is subject to the approval by the Company’s

common stockholders.

The Merger Agreement contains conditions to the completion of the Merger, including the filing of the articles of

incorporation and/or organization for the merger subsidiaries, and the adoption of board resolutions and/or sole member resolutions by

the merger subsidiaries approving the Merger.

On February 13, 2025, all of the closing conditions to the Merger Agreement were satisfied

or waived, the Preferred Shares have been issued to NAHD’s shareholders, and the transactions set forth in the Merger Agreement

have been fully completed and closed.

The Company operates in the following

four segments:

(i) construction;

(ii) medical;

(iii) oil and gas;

and (iv) environmental.

The construction segment designs and constructs

modular structures built in the Company’s factories.

In the medical segment, the Company uses its modular technology to (a) provide

turnkey solutions to medical testing and treatment and to generate revenue from the medical testing and point of care treatment in our

medical suites and (b) sell and lease medical suites and privacy pods.

The environmental segment consists of a sustainable medical and

waste management solution that collects waste and treats waste for safe disposal.

The building products developed with

the Company’s proprietary technology and design and engineering expertise are generally stronger, more durable, environmentally

sensitive, and erected in less time than traditional construction methods.

The use of the Company’s modules typically provides between four to six points

towards the Leadership in Energy and Environmental Design (“LEED”) certification levels, including reduced site disturbance,

resource reuse, recycled content, innovation in design and use of local and regional materials.

Due to the ability of the modules to satisfy

such requirements, the Company believes the products produced utilizing its technology and expertise is a leader in environmentally

sustainable construction.

There are three core product

offerings that utilize the Company’s technology and engineering expertise.

The first product offering involves GreenSteel™

modules, which are the structural core and shell of an SGBlocks building.

The Company procures the containers, engineers required openings

with structural steel enforcements, paints the SGBlocks and then delivers them on-site, where the customer or a customer’s general

contractor will complete the entire finish out and installation.

The second product offering involves replicating the process to create

the GreenSteel product and, in addition, installing selected materials, finishes and systems (including, but not limited to floors, windows,

doors, interior painting, electrical wiring and fixtures, plumbing outlets and bathrooms, roofing system) and delivering SGBlocks pre-fabricated

containers to the site for a third party licensed general contractor to complete the final finish out and installation.

Finally, the third

product offering is the completely fabricated and finished SGBlocks building (including but not limited to floors, windows, doors, interior

painting, electrical wiring and fixtures, plumbing outlets and bathrooms, roofing systems), including erecting the final unit on site

and completing any other final steps.

The building is ready for occupancy and/or use as soon as installation is completed.

administration and/or project management services are typically included in the Company’s product offerings.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Description of Business (continued)

The Company also provides engineering

and project management services related to the use and modification of modules in construction.

During 2020, the Company formed SG Echo,

LLC as a wholly owned subsidiary (“SG Echo”).

The Company acquired substantially all the assets of Echo DCL (“Echo”),

a Texas limited liability company, except for Echo’s real estate holdings for which the Company obtained a right of first refusal.

Echo is a container/modular manufacturer based in Durant, Oklahoma specializing in the design and construction of permanent modular and

temporary modular buildings and was one of the Company’s key supply chain partners.

Echo caters to the military, education, administration

facilities, healthcare, government, commercial and residential customers.

This acquisition has allowed the Company to expand its reach

for the modules and offer an opportunity to vertically integrate a large portion of the Company’s cost of goods sold, as well as

increase margins, productivity and efficiency in the areas of design, estimating, manufacturing and delivery and to become the manufacturer

of the Company’s core container and modular product offerings.

As of January 2021 and through the fourth

quarter of 2021, the Company’s consolidated financial statements include the accounts of Chicago Airport Testing LLC (“CAT”).

The Company had a variable interest in CAT as described further below.

CAT is in the business of marketing, selling, distributing, leasing

and otherwise commercially exploiting certain products and services in the COVID-19 testing and other medical industry.

during March 2023, the Company formed Safe and Green Medical Corporation.

The Company also entered into a joint venture with Clarity Lab

Solutions LLC., to provide clinical lab testing related to COVID-19, which ceased activities in 2022.

In connection with the Company’s

acquisition of NAHD the Company now operates in the oil and gas industry.

During 2024, NAHD acquired Olenox Corp.

a Wyoming corporation.

Olenox is an advanced energy company with three vertically integrated business units:

Oil & Gas Production,

Energy Services, and Energy Technologies.

The company specializes in acquiring and revitalizing underdeveloped energy assets, leveraging

proprietary plasma pulse and ultrasonic cleaning tools to enhance production efficiency while reducing environmental impact.

strategic focus on distressed oil and gas fields in Texas, Oklahoma, and Kansas has resulted in significant production growth, positioning

the company for long-term success in the energy sector.

Additionally, during 2024, NAHD acquired Machfu, Inc.

a Delaware corporation.

Machfu is a leader in industrial Internet of Things (“IoT”), with its flagship MachGateway® and

Edge-to-Enterprise™ software solutions enabling seamless connectivity between legacy systems and modern digital infrastructure.

With over 20,000 gateways deployed worldwide, Machfu’s technology enhances operational efficiency, predictive maintenance, and real-time

analytics for industries including oil & gas, utilities, and manufacturing.

Environmental

During 2022, SG Environmental Solutions

(“SG Environmental”) was formed and is focused on biomedical waste removal and plans to utilize a patented technology

that it licenses to shred and disinfect biomedical waste, rendering the waste disinfected, unrecognizable, and of no greater risk to the

public health than residential household waste.

Reverse Stock Split

On May 2, 2024, the Company effected

a 1-for-20 reverse stock split of its then-outstanding common stock (the “May Stock Split”).

All share and per share amounts

set forth in the consolidated financial statements of the Company have been retroactively restated to reflect the 1-for-20 reverse stock

split as if it had occurred as of the earliest period presented and unless otherwise stated, all other share and per share amounts for

all periods presented in this Quarterly Report on Form 10-Q for the period ended September 30, 2025 have been adjusted to reflect the

reverse stock split effected in May 2024.

On September 8, 2025, the Company effected

a 1-for-64 reverse stock split of its then-outstanding common stock (the “September Stock Split”).

All share and per share

amounts set forth in the consolidated financial statements of the Company have been retroactively restated to reflect the 1-for-64 reverse

stock split as if it had occurred as of the earliest period presented and unless otherwise stated, all other share and per share amounts

for all periods presented in this Quarterly Report on Form 10-Q for the period ended September 30, 2025 have been adjusted to reflect

the reverse stock split effected in September 2025.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Separation and Distribution

In December 2022, the Company and then

owner of 100 % of the issued and outstanding securities of SG DevCorp announced its plan to separate the Company and SG DevCorp into

two separate publicly traded companies (the “Separation”).

To implement the Separation, on September 27, 2023 (the “Distribution

Date”), the Company, effected a pro rata distribution to its stockholders of approximately 30 % of the outstanding shares of SG DevCorp’s

common stock (the “Distribution”).

In connection with the Distribution, each Company stockholder received 0.930886 shares

of SG DevCorp’s common stock for every five ( 5 ) shares of Company common stock held as of the close of business on September 8,

2023, the record date for the Distribution, as well as a cash payment in lieu of any fractional shares.

Immediately after the Distribution,

SG DevCorp was no longer a wholly owned subsidiary of the Company and the Company held approximately 70 % of SG DevCorp’s issued

and outstanding securities.

On September 28, 2023, SG DevCorp’s common stock began trading on the Nasdaq Capital Market under the

symbol “SGD.”

In connection with the Separation and

Distribution, SG DevCorp entered into a separation and distribution agreement and several other agreements with the Company.

These agreements

provide for the allocation between SG DevCorp and the Company of the assets, employees, liabilities and obligations (including, among

others, investments, property, employee benefits and tax-related assets and liabilities) of the Company and its subsidiaries attributable

to periods prior to, at and after the Separation and will govern the relationship between the Company and SG DevCorp subsequent to the

completion of the Separation.

In addition to the separation and distribution agreement, the other principal agreements entered into with

the Company included a tax matters agreement and a shared services agreement.

During 2024, the Company’s ownership

in SG DevCorp fell below 50 %, and the Company deconsolidated SG DevCorp from its financial statements (the “Deconsolidation”).

The decrease in ownership percentage resulted from additional equity transactions of SG DevCorp.

As of December 31, 2024, the Company

accounts for its investment in SG DevCorp on the equity method.

Upon deconsolidation, the Company recognized a gain of $ 4,637,013 which

resulted from the difference between the fair value of the Company’s investment upon deconsolidation, and the net assets and carrying

value of the non-controlling interest.

The gain is included in income (loss) from discontinued operations.

The fair value of the Company’s

investment in SG DevCorp upon deconsolidation amounted to $ 8,126,350 .

The Deconsolidation represents a strategic shift in the Company’s

operations and will have a major effect on the Company’s operations and financial results.

Prior year financial statements for 2024

have been restated to present the operations of SG DevCorp as a discontinued operation.

This transaction is further described in

Note 18 and 19.

Olenox Industries Inc., previously known as Safe & Green Holdings Corp., (collectively with its subsidiaries, the “Company,” “we”, “us” or “our”) is a vertically integrated energy company operating across multiple business lines, including oil and gas, energy services, and energy technologies.

The Company is focused on acquiring, optimizing, and scaling energy-related infrastructure and operating assets across key U.S.

On February 2, 2025, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and between the Company and New Asia Holdings, Inc., a Nevada corporation (“NAHD”), pursuant to which NAHD was merged into a subsidiary of the Company (the “Merger”).

Following the Merger, NAHD and its operating subsidiaries became indirect, wholly owned subsidiaries of the Company.

As merger consideration, the Company issued four million ( 4,000,000 ) shares of Series A non-voting convertible preferred shares of the Company, par value $ 1.00 (the “Series A Preferred Shares”), to NAHD’s shareholders, with each Series A Preferred Share having the right to convert into 640 shares of common stock of the Company, provided, however, that any such conversion is subject to the approval by the Company’s common stockholders.

The Merger Agreement contained conditions to the completion of the Merger, including the filing of the articles of incorporation and/or organization for the merger subsidiaries, and the adoption of board resolutions and/or sole member resolutions by the merger subsidiaries approving the Merger.

On February 13, 2025, all of the closing conditions to the Merger Agreement were satisfied or waived, the Preferred Shares were issued to NAHD’s shareholders, and the transactions set forth in the Merger Agreement have been fully completed and closed.

On January 7, 2026, the Company changed its name from Safe & Green Holdings Corp.

to Olenox Industries Inc.

by filing a Certificate of Amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware.

The Company operates in the following industries:

The Company creates purpose built, prefabricated modules from wood, steel, and shipping containers into new structures.

Olenox enables developers, architects, builders and owners to achieve greener construction, faster execution and stronger buildings of higher value and extended life.

The Company specializes in acquiring and revitalizing underdeveloped energy assets, leveraging proprietary plasma pulse and ultrasonic cleaning tools to enhance production efficiency while reducing environmental impact.

Olenox’s strategic focus on distressed oil and gas fields in Texas, Oklahoma, and Kansas has resulted in significant production growth, positioning it for long-term success in the energy sector.

The Company is a provider of industrial IoT solutions, specialized in secure, low-power edge-to-cloud connectivity and edge computing for critical infrastructure and industrial operations.

The Company delivers an integrated hardware and software ecosystem;

including its core Machfu Gateway, MACHREACTOR protocol translation engine, and fully managed, turnkey Industrial IoT Service that enables the seamless collection, translation, and transmission of data between legacy industrial controllers, sensors, and modern cloud environments.

Utilizing extended-range communication technologies like LoRa, alongside bandwidth-conserving protocols such as MQTT/SparkPlug B, the Company’s solutions allow utility, energy, and oil and gas operators to implement bi-directional monitoring and real-time data intelligence.

These services are designed to lower operating and connectivity costs, minimize operational downtime, and assist enterprise customers in meeting regulatory compliance and environmental, social, and governance (ESG) standards.

LIQUIDITY AND GOING CONCERN

As of September 30, 2025, the Company

had cash and cash equivalents of $ 3,021,757 and a backlog of $ 575,571 .

See Note 10 for a discussion of construction backlog.

Based on its conversations with key customers, the Company anticipates its backlog to convert to revenue over the following period:

Within 1 year

Total Backlog

The Company has incurred losses since its inception, has negative working

capital of $ 19,635,275 as of September 30, 2025 and has negative operating cash flows, which has raised substantial doubt about its ability

to continue as a going concern.

The accompanying financial statements do not include any adjustments to reflect the possible future effects

on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome

of the uncertainty concerning the Company’s ability to continue as a going concern.

The Company intends to meet its capital

needs from revenue generated from operations and by containing costs, entering into strategic alliances, as well as exploring other options,

including the possibility of raising additional debt or equity capital as necessary.

There is, however, no assurance the Company will

be successful in meeting its capital requirements prior to becoming cash flow positive.

The Company does not have any additional

sources secured for future funding, and if it is unable to raise the necessary capital at the times it requires such funding, it may need

to materially change its business plan, including delaying implementation of aspects of such business plan or curtailing or abandoning

such business plan altogether.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

The Company has incurred losses since its inception, has negative working capital of approximately $ 23.4 million and has negative operating cash flows, which raise substantial doubt about the Company’s ability to continue as a going concern.

The accompanying condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of the uncertainty concerning the Company’s ability to continue as a going concern.

The Company intends to address these conditions by increasing revenues from operations, containing costs, pursuing strategic alliances, and obtaining additional debt or equity financing as necessary.

There can be no assurance the Company will be successful in meeting its capital requirements.

The Company does not have any additional sources secured for future funding, and if it is unable to raise the necessary capital at the times it requires such funding, it may be required to delay, reduce or eliminate planned business activities.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation and principals

of consolidation – The accompanying unaudited condensed financial statements have been prepared in accordance with accounting

principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions

to the Quarterly Report on Form 10-Q and Article 8 Regulation S-X.

Accordingly, they do not include all of the information and notes required

by GAAP for annual financial statements.

The condensed financial statements and notes should be read in conjunction with the consolidated

financial statements and notes for the year ended December 31, 2024 included in the Company’s Annual Report on Form 10-K for the

year ended December 31, 2024, as filed with the Securities and Exchange Commission on April 1, 2025.

In the opinion of management, all

adjustments, consisting of normal accruals, considered necessary for a fair presentation of the interim financial statements have been

Results for the nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for

the year ending December 31, 2025.

Recently adopted accounting pronouncements

- New accounting pronouncements implemented by the Company are discussed below or in the related notes, where appropriate.

Basis of presentation and principles of consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X.

Accordingly, they do not include all of the information and footnotes required by U.S.

GAAP for complete financial statements.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the Company’s financial position as of March 31, 2026, and its results of operations and cash flows for the periods presented.

The results of operations for the three months ended March 31, 2026, are not necessarily indicative of the results to be expected for the full fiscal year or any other period.

These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission on June 30, 2026.

The condensed consolidated balance sheet as of December 31, 2025 was derived from the audited financial statements as of that date but does not include all disclosures required by U.S.

There have been no material changes to the Company’s significant accounting policies as described in the Annual Report on Form 10-K for the year ended December 31, 2025.

Restatement of Previously Issued Financial Statements

In February 2025, the Company completed the Merger with NAHD.

As consideration for the Merger, the Company issued 4,000,000 shares of its Series A Preferred Stock.

The Company initially recorded the consideration transferred at a fair value of $ 34,569,600 .

During the finalization of the Company’s December 31, 2025, financial statements, the acquisition-date fair value of the 4,000,000 shares of Series A Preferred Stock issued as consideration was restated down to $ 18,800,000 .

ASC 805, Business Combinations , requires the consideration transferred in a business combination, including equity interests issued by the acquirer, to be measured at fair value as of the acquisition date.

The $ 15,769,600 difference between the amount originally recorded and the acquisition-date fair value therefore represents an error in measurement in previously issued financial statements within the meaning of ASC 250, Accounting Changes and Error Corrections .

Because the identifiable assets acquired and liabilities assumed in the Merger were unchanged, the correction reduces the consideration transferred, and correspondingly goodwill, by $ 15,769,600 , and reduces by the same amount the value recorded in stockholders’ equity for the Series A Preferred Stock issued as consideration.

The correction does not change the number of shares of Series A Preferred Stock issued or outstanding, the rights and preferences of those shares, or the Company’s net loss, net loss per share, cash flows, or working capital for any period presented.

The correction to the March 31, 2025 financial statements is contained in the March 31, 2025 financial statements included herein.

Management is in the process of determining if the corrected financial statements for the three months ended March 31, 2025 will be filed in an additional filing.

The Merger was completed during the three months ended March 31, 2025.

Accordingly, the restatement has no effect on total stockholders’ equity as of December 31, 2024, and affects only the line items within the condensed consolidated statement of changes in stockholders’ equity and the condensed consolidated statement of cash flows reflecting the issuance of Series A Preferred Stock as consideration for the Merger, and the resulting balance as of March 31, 2025, June 30, 2025, and September 30, 2025.

The following table presents the effect of the revision on the affected line items of the condensed consolidated statement of changes in stockholders’ equity and condensed consolidated statement of cash flows for the three months ended March 31, 2025:

Line Item As Reported Revision As Restated

Total consideration transferred ( 4,000,000 shares of Series A Preferred Stock) $ 34,569,600 $ ( 15,769,600 ) $ 18,800,000

Goodwill $ 38,160,202 $ ( 15,769,600 ) $ 22,390,602

Series A Preferred Stock consideration recorded in stockholders’ equity $ 34,569,600 $ ( 15,769,600 ) $ 18,800,000

Supplemental disclosure of non-cash investing and financing activities:

Goodwill $ 38,160,202 $ ( 15,769,600 ) $ 22,390,602

In addition, the Company reclassified $ 6.8 million from goodwill to identifiable assets and liabilities for the year ended December 31, 2025, which is related to the finalization of the Company’s December 31, 2025 acquisition-date fair value of the 4,000,000 shares of Series A Preferred Stock.

This was not a correction of an error, as the purchase price allocation was provisional until that point and the amortization of said identifiable intangible assets was trued up.

Accounting estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgements

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 amount of revenues and expenses during the reporting period, together with amounts disclosed

in the related notes to the financial statements.

The Company’s estimates used in these financial statements include, but are

not limited to, revenue recognition, stock-based compensation, accounts receivable reserves, inventory valuations, goodwill, the valuation

allowance related to the Company’s deferred tax assets, the carrying amount of intangible assets, right of use assets and the recoverability

and useful lives of long-lived assets.

Certain of the Company’s estimates could be affected by external conditions, including those

unique to the Company and general economic conditions.

It is reasonably possible that these external factors could have an effect on the

Company’s estimates and could cause actual results to differ from those estimates.

Operating cycle –

The length of the Company’s contracts varies, but is typically between six to twelve months.

In some instances,

the length of the contract may exceed twelve months.

Assets and liabilities relating to contracts are included in current assets

and current liabilities, respectively, in the accompanying balance sheets as they will be liquidated in the normal course of contract

completion, which at times could exceed one year.

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments 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 amount of revenues and expenses during the reporting period, together with amounts disclosed in the related notes to the financial statements.

The Company’s estimates used in these condensed consolidated financial statements include, but are not limited to, revenue recognition, stock-based compensation, accounts receivable reserves, inventory valuations, embedded derivatives, the valuation allowance related to the Company’s deferred tax assets, the carrying amount of goodwill and intangible assets, right of use assets, oil and gas reserve estimates and the recoverability and useful lives of long-lived assets.

Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions.

It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates.

Revenue recognition

The Company determines, at contract inception, whether it will transfer control of a promised good or service over time or at a point

in time, regardless of the length of contract or other factors.

The recognition of revenue aligns with the timing of when promised goods

or services are transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange

for those goods or services.

To achieve this core principle, the Company applies the following five steps in accordance with its revenue

The Company determines, at contract inception, whether it will transfer control of a promised good or service over time or at a point in time, regardless of the length of contract or other factors.

The recognition of revenue aligns with the timing of when promised goods or services are transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

To achieve this core principle, the Company applies the following five steps in accordance with its revenue policy:

(1) Identify the contract with a customer

3 unchanged sentences

(5) Recognize revenue as performance obligations are satisfied

On certain contracts, the Company

applies recognition of revenue over time, which is similar to the method the Company applied under previous guidance (i.e., percentage

of completion).

Due to uncertainties inherent in the estimation process, it is possible that estimates of costs to complete a performance

obligation will be revised in the near-term.

For those performance obligations for which revenue is recognized using a cost-to-cost input

method, changes in total estimated costs, and related progress toward complete satisfaction of the performance obligation, are recognized

on a cumulative catch-up basis in the period in which the revisions to the estimates are made.

When the current estimate of total costs

for a performance obligation indicates a loss, a provision for the entire estimated loss on the unsatisfied performance obligation is

made in the period in which the loss becomes evident.

The Company recognizes revenue from

its interests in oil and gas properties when control of the commodity transfers to the purchaser, which typically occurs at the delivery

point designated in the sales contract.

Revenue is derived from the Company’s proportionate share of oil and gas production under

lease agreements.

The Company does not operate the properties but receives its share of production based on its working interest or royalty

The Company’s other revenue is related to subscription services, of which revenue is recognized over time as services

are provided.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Disaggregation of Revenues

The Company’s revenues are primarily

derived from construction related to modules projects.

The Company’s contracts are with customers in various industries.

recognized over time was $ 2,151,595 and $ 3,932,592 , respectively, for the nine months ended September 30, 2025 and 2024.

recognized over time was $ 925,528 and $ 1,753,223 , respectively, for the three months ended September 30, 2025 and 2024.

recognized at a point in time was $ 187,275 and $ 0 , respectively, for the nine months ended September 30, 2025 and 2024.

recognized at a point in time was $ 125,637 and $ 0 , respectively, for the three months ended September 30, 2025 and 2024.

The following tables provide further disaggregation of the Company’s revenues

by categories:

Three Months Ended September 30,

Revenue by Customer Type

Construction and Engineering Services:

Hotel/Hospitality

Total revenue by customer type

Nine Months Ended September 30,

Revenue by Customer Type

Construction and Engineering Services:

Hotel/Hospitality

Total revenue by customer type

Contract Assets and Contract Liabilities

Accounts receivable is recognized in

the period when the Company’s right to consideration is unconditional.

Accounts receivable is recognized net of an allowance for

credit losses.

A considerable amount of judgment is required in assessing the likelihood of realization of receivables.

The timing of revenue recognition may

differ from the timing of invoicing to customers.

Contract assets include unbilled amounts

from long-term construction services when revenue recognized under the cost-to-cost measure of progress exceeds the amounts invoiced to

customers, as the amounts cannot be billed under the terms of the Company’s contracts.

Such amounts are recoverable from customers

based upon various measures of performance, including achievement of certain milestones, completion of specified units or completion of

Contract assets are generally classified as current within the condensed consolidated balance sheets.

Contract liabilities from construction

and engineering contracts occur when amounts invoiced to customers exceed revenues recognized under the cost-to-cost measure of progress.

Construction Services

The Company applies recognition of revenue over time.

Due to uncertainties inherent in the estimation process, it is possible that estimates of costs to complete a performance obligation will be revised in the near-term.

For those performance obligations satisfied over time, the Company uses a cost-to-cost input method to recognize revenue with any changes in total estimated costs, and related progress toward complete satisfaction of the performance obligation being recognized on a cumulative catch-up basis in the period in which the revisions to the estimates are made.

The Company believes the cost-to-cost input method faithfully depicts the transfer of control to the customer because the costs incurred (principally labor, materials, and subcontractor costs) are incurred as the Company satisfies the performance obligation and are directly proportionate to the Company’s progress in transferring control of the promised goods or services to the customer.

As costs are incurred, control of the work in process - and the resulting asset or service - passes to the customer, so the ratio of costs incurred to total estimated costs reasonably represents the extent to which the performance obligation has been satisfied.

When the current estimate of total costs for a performance obligation indicates a loss, a provision for the entire estimated loss on the unsatisfied performance obligation is made in the period in which the loss becomes evident.

Contract assets include unbilled amounts from construction services when revenue recognized under the cost-to-cost measure of progress exceeds the amounts invoiced to customers, as the amounts cannot be billed under the related contract terms.

Such amounts are recoverable from customers based upon various measures of performance, including achievement of certain milestones, completion of specified units or completion of a contract.

Contract liabilities from construction and engineering contracts occur when amounts invoiced to customers exceed revenues recognized under the cost-to-cost measure of progress.

Contract liabilities additionally include advanced payments from customers on certain contracts.

Contract liabilities decrease as the

Company recognizes revenue from the satisfaction of the related performance obligation.

Contract liabilities are generally classified

as current within the condensed consolidated balance sheet.

Although the Company believes it

has established adequate procedures for estimating costs to complete on open contracts, it is at least reasonably possible that additional

significant costs could occur on contracts prior to completion.

The Company periodically evaluates and revises its estimates and makes

adjustments when they are considered necessary.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Business Combinations

- The Company accounts for business acquisitions using the acquisition method of accounting in accordance with Accounting Standards Codification

(“ASC”) 805 “Business Combinations”, which requires recognition and measurement of all identifiable

assets acquired and liabilities assumed at their fair value as of the date control is obtained.

The Company determines the fair value

of assets acquired and liabilities assumed based upon its best estimates of the acquisition-date fair value of assets acquired and liabilities

assumed in the acquisition.

Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable

intangible assets acquired.

Subsequent adjustments to fair value of any contingent consideration are recorded to the Company’s consolidated

statements of operations.

Costs that the Company incurs to complete the business combination are charged to general and administrative

expenses as they are incurred.

For acquisitions of assets that do not

constitute a business, any assets and liabilities acquired are recognized at their cost based upon their relative fair value of all asset

and liabilities acquired.

Variable Interest Entities

– The Company accounts for certain legal entities as variable interest entities (“VIE”).

When evaluating a VIE for consolidation,

the Company must determine whether or not there is a variable interest in the entity.

Variable interests are investments or other interests

that absorb portions of an entity’s expected losses or receive portions of the entity’s expected returns.

If it is determined

that the Company does not have a variable interest in the VIE, no further analysis is required and the VIE is not consolidated.

Company holds a variable interest in a VIE, the Company consolidates the VIE when there is a controlling financial interest in the VIE

and therefore are deemed to be the primary beneficiary.

The Company is determined to have a controlling financial interest in a VIE when

it has both the power to direct the activities of the VIE that most significantly impact the VIE economic performance and the obligation

to absorb losses or the right to receive benefits of the VIE that could potentially be significant to that VIE.

This determination is

evaluated periodically as facts and circumstances change.

Investment Entities – The

Company accounts for investment in SG DevCorp at fair value with any changes in value recorded to income or loss.

As of December

31, 2024, the Company held 276,425 shares of SG DevCorp (the “Shares”) which represented approximately 19 %

ownership and amounted to $ 738,056 .

On January 29, 2025, the Company entered into a mutual release and discharge agreement (the “Mutual

Release”) with SG DevCorp.

pursuant to SG DevCorp.

forgiving and releasing from our obligations to them under that certain promissory

note, dated August 9, 2023, in the principal amount of $ 908,323 and in respect of $ 793,590 of inter-company advances from SG

to the Company in exchange for the Company forgiving $ 394,329 of inter-company debt owed to the Company by the Company and

for SG DevCorp.(which has already been written off) transferring the Shares, with the Company no longer being a shareholder of SG

The Company recognized $ 311,560 in change in fair value of its investment in SG DevCorp for the period ended January 29,

In connection with the Mutual Release, the Company recorded $ 1,275,417 to additional paid in capital which resulted from the transactions

above and the Company’s investment in SG DevCorp write down of $ 426,496 .

The Company acquired an investment in

CycleAIM, Inc.(“CycleAIM”) through the NAHD Merger.

The Company has a 51 % ownership interest in this joint venture.

Company will analyze its underlying investment in CycleAim during the measurement period of the acquisition.

The Company acquired an investment in

Winchester LLC in the amount of $ 220,000 .

The Company currently holds a 49 % interest and accounts for its investment under the equity

There has been no activity in the underlying investment as of September 30, 2025.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Cash and cash equivalents –

The Company considers cash and cash equivalents to include all short-term, highly liquid investments that are readily convertible to known

amounts of cash and have original maturities of three months or less upon acquisition.

Cash and cash equivalents totaled $ 3,021,757 and $ 375,873

as of September 30, 2025, and December 31, 2024, respectively.

Short-term investment –

The Company classifies investments consisting of a certificate of deposit with a maturity greater than three months but less than one

year as short-term investment.

The Company had no short-term investment as of September 30, 2025 or December 31, 2024,

respectively.

Accounts receivable and allowance

for credit losses – Accounts receivable are receivables generated from sales to customers and progress billings on

performance type contracts.

Amounts included in accounts receivable are deemed to be collectible within the Company’s operating

The Company recognizes accounts receivable at invoiced amounts.

The Company adopted ASC 326, Current

Expected Credit Losses, on January 1, 2023, which requires the measurement and recognition of expected credit losses using a current expected

credit loss model.

The allowance for credit losses on expected future uncollectible accounts receivable is estimated considering forecasts

of future economic conditions in addition to information about past events and current conditions.

The allowance for credit losses reflects

the Company’s best estimate of expected losses inherent in the accounts receivable balances.

Management provides an allowance for

credit losses based on the Company’s historical losses, specific customer circumstances, and general economic conditions.

Periodically,

management reviews accounts receivable and adjusts the allowance based on current circumstances and charges off uncollectible receivables

when all attempts to collect have been exhausted and the prospects for recovery are remote.

Recoveries are recognized when they are received.

Actual collection losses may differ from the Company’s estimates and could be material to its consolidated financial position, results

of operations, and cash flows.

The Company accounts for the transfer

of accounts receivable to a third party under a factoring type arrangement in accordance with ASC 860, “Transfers and Servicing”.

ASC 860 requires that several conditions be met in order to present the transfer of accounts receivable as a sale.

In the case of factoring

type arrangements, the Company has isolated the transferred (sold) assets and has the legal right to transfer its assets (accounts receivable).

Inventory – Raw

construction materials (primarily shipping containers and fabrication materials) are valued at the lower of cost (first-in, first-out

method) or net realizable value.

Finished goods and work-in-process inventories are valued at the lower of cost or net realizable value,

using the specific identification method.

As of September 30, 2025 and December 31, 2024, there was inventory of $ 506,618

and $ 471,468 , respectively, for construction materials.

As of September, 30, 2025, there was inventory of $ 474,321 related

to Machfu business operations.

Goodwill – The

Company performs its impairment test of goodwill at the reporting unit level each fiscal year, or more frequently if events or circumstances

change that would more likely than not reduce the fair value of its reporting unit below it’s carrying values.

performs a goodwill impairment test by comparing the fair value of the reporting unit with it’s carrying value and recognizes an

impairment charge for the amount by which the carrying value exceeds the fair value, not to exceed the total amount of goodwill.

by which the carrying value of the goodwill exceeds its implied fair value, if any, is recognized as an impairment loss.

There were no

impairments during the September 30, 2025 or 2024.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Intangible assets –

Intangible assets consist of $ 75,050 of website costs that are being amortized over 5 years and patents of $ 812,938 that are

being recognized over 7 years.

The amortization expense for the nine months ended September 30, 2025 and 2024 was $ 67,015 and $ 10,251 ,

respectively.

The accumulated amortization as of September 30, 2025 and December 31, 2024 was $ 130,407 and $ 63,392 , respectively.

Property, plant and equipment

– Property, plant and equipment is stated at cost.

Depreciation is computed using the straight-line method over the estimated

lives of each asset.

Estimated useful lives for significant classes of assets are as follows:

computer and software 3 to 5 years, furniture

and other equipment 5 to 7 years, automobiles 2 to 5 years, buildings held for lease 5 to 7 years, building 40 years, and equipment 5

to 29 years .

Repairs and maintenance are charged to expense when incurred.

Oil and Gas Properties – The

Company uses the full cost method of accounting for its investment in oil and natural gas properties.

Under this method of accounting,

all costs associated with acquisition, exploration and development of oil and gas reserves, including directly related overhead costs,

are capitalized.

General and administrative costs related to production and general overhead are expensed as incurred.

All capitalized costs of oil and gas

properties, including the estimated future costs to develop proved reserves, are amortized on the unit of production method using estimates

of proved reserves.

Disposition of oil and gas properties are accounted for as a reduction of capitalized costs, with no gain or loss

recognized unless such adjustment would significantly alter the relationship between capitalized costs and proved reserves of oil and

gas, in which case the gain or loss is recognized in operations.

Unproved properties and major development projects are not amortized

until proved reserves associated with the projects can be determined or until impairment occurs.

If the results of an assessment indicate

that the properties are impaired, the amount of impairment is included in loss from operations before income taxes.

Limitation on Capitalized Costs

– Under the full-cost method of accounting, we are required, at the end of each reporting date, to perform a test to determine

the limit on the book value of our oil and natural gas properties (the “Ceiling” test).

If the capitalized costs of our oil

and natural gas properties, net of accumulated amortization and related deferred income taxes, exceed the Ceiling, this excess or impairment

is charged to expense.

The expense may not be reversed in future periods, even though higher oil and natural gas prices may subsequently

increase the Ceiling.

The Ceiling is defined as the sum of:

(a) the present value, discounted at 10 percent, and assuming continuation of existing economic conditions, of 1) estimated future gross revenues from proved reserves, which is computed using oil and natural gas prices determined as the unweighted arithmetic average of the first-day-of-the-month price for each month within the 12-month hedging arrangements pursuant to SAB 103, less 2) estimated future expenditures (based on current costs) to be incurred in developing and producing the proved reserves, plus

the cost of properties not being amortized;

the lower of cost or estimated fair value of unproven properties included in the costs being amortized, net of

the related tax effects related to the difference between the book and tax basis of our oil and natural gas properties.

Oil and Gas Reserves – Reserve

engineering is a subjective process that is dependent upon the quality of available data and the interpretation thereof, including evaluations

and extrapolations of well flow rates and reservoir pressure.

Estimates by different engineers often vary sometimes significantly.

addition, physical factors such as the results of drilling, testing and production subsequent to the date of an estimate, as well as economic

factors such as changes in product prices, may justify revision of such estimates.

Because proved reserves are required to be estimated

using recent prices of the evaluation, estimated reserve quantities can be significantly impacted by changes in product prices.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Depreciation, depletion, and Amortization

and Accretion – The estimates of proved reserves materially impact depreciation, depletion, amortization and accretion (“DD&A”)

If the estimates of proved reserves decline, the rate at which we record DD&A expense will increase, reducing future net

Such a decline may result from lower market prices, which may make it uneconomic to drill for and produce from higher-cost fields.

Asset retirement obligations

- The Company records a liability for Asset Retirement Obligations (“AROs”) associated with its oil and gas wells when those

assets are placed in service.

The corresponding cost is capitalized as an asset and included in the carrying amount of oil and gas properties

and is depleted over the useful life of the properties.

Subsequently, the ARO liability is accreted to its then-present value.

Inherent in the fair value calculation

of an ARO are numerous assumptions and judgments including the ultimate settlement amounts, inflation factors, credit adjusted discount

rates, timing of settlement, and changes in the legal, regulatory, environmental, and political environments.

To the extent future revisions

to these assumptions impact the fair value of the existing ARO liability, a corresponding adjustment is made to the oil and gas property

Settlements greater than or less than amounts accrued as ARO are recorded as a gain or loss upon settlement.

As of September 30, 2025, the asset retirement obligations amounted

to $ 316,995 and is included in accounts payable and accrued expense on the accompanying condensed consolidated balance sheet.

Additionally,

as of September 30, 2025 $ 185,074 is included in oil and gas, on the basis of full cost accounting, net on the accompanying condensed

consolidated balance sheet for the Company’s asset retirement obligation asset balance.

Proved Reserves – As of September 30, 2025, all of the Company’s oil and gas reserves

are proved reserves.

Such amount was acquired in the Merger.

Estimates of our proved reserves included in this report are prepared in

accordance with U.S.

SEC guidelines for reporting corporate reserves and future net revenue.

The accuracy of a reserve estimate is a function

the quality and quantity of available data;

the interpretation of that data;

the accuracy of various mandated economic assumptions;

the judgment of the persons preparing the estimate.

Our proved reserve information included

in this report was predominately based on estimates.

Because these estimates depend on many assumptions, all of which may substantially

differ from future actual results, reserve estimates will be different from the quantities of oil and gas that are ultimately recovered.

In addition, results of drilling, testing and production after the date of an estimate may justify material revisions to the estimate.

The estimated proved net recoverable

reserves include only those quantities that were expected to be commercially recoverable at prices and costs in effect at the balance

sheet dates under the then existing regulatory practices and with conventional equipment and operating methods.

All of the Company’s

Proved Reserves are located onshore in the continental United States of America.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Convertible instruments –

The Company bifurcates conversion options from their host instruments and accounts for them as free standing derivative financial instruments

according to certain criteria.

The criteria include circumstances in which (a) the economic characteristics and risks of the embedded

derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid

instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise

applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument

with the same terms as the embedded derivative instrument would be considered a derivative instrument.

Common stock purchase

warrants and other derivative financial instruments – The Company classifies as equity any contracts that (i) require

physical settlement or net-share settlement or (ii) provides a choice of net-cash settlement or settlement in the Company’s

own shares (physical settlement or net-share settlement) providing that such contracts are indexed to the Company’s own stock.

The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net

cash settle the contract if any event occurs and if that event is outside the Company’s control) or (ii) gives the

counterparty a choice of net-cash settlement or settlement shares (physical settlement or net-cash settlement).

assesses classification of common stock purchase warrants and other free-standing derivatives at each reporting date to determine

whether a change in classification between assets and liabilities or equity is required.

Contract liabilities decrease as the Company recognizes revenue from the satisfaction of the related performance obligation.

Although the Company believes it has established adequate procedures for estimating costs to complete on open contracts, it is at least reasonably possible that additional significant costs could occur on contracts prior to completion.

The Company periodically evaluates and revises its estimates and makes adjustments as considered necessary.

Industrial Connectivity and Monitoring Service

The Company has concluded that the hardware, embedded and hosted software, post-contract customer support, and related engineering and consulting services promised in its customer arrangements are not distinct within the context of the contract.

The goods and services are highly interdependent and interrelated, with the Company providing a significant integration service that combines them into a single, customer-specific industrial IoT solution.

Accordingly, the Company accounts for these services as a single performance obligation.

The Company recognizes these revenues over time with respect to this combined performance obligation, as the Company’s performance creates or enhances an asset that the customer controls and the Company’s performance does not create an asset with an alternative use to the Company together with an enforceable right to payment for performance completed to date.

Because the combined solution is delivered as a continuous service, the Company has determined that a time-elapsed output method faithfully depicts the transfer of control to the customer.

Revenue is therefore recognized ratably over the service period, commencing on the date the solution is made available to the customer and continuing through the term of the arrangement.

Oil and Gas Sales

The Company recognizes revenue from its interests in oil and gas properties when control of the commodity transfers to the purchaser, which typically occurs at the delivery point designated in the sales contract.

Revenue is derived from the Company’s proportionate share of oil and gas production under lease agreements.

The Company’s other revenue is related to subscription services, of which revenue is recognized over time as services are provided.

The following tables provide further disaggregation of the Company’s revenues by performance obligations:

Three Months Ended

Performance obligations satisfied over time $ 126,020 $ 566,354

Performance obligations satisfied at a point in time 159,293 —

Total Revenue $ 285,313 $ 566,354

Fair value measurements

Financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities are carried

at cost, which the Company believes approximates fair value due to the short-term nature of these instruments.

The Company measures the fair value

of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an

exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants

on the measurement date.

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring

The Company uses three levels of inputs

that may be used to measure fair value:

Quoted prices in active markets for identical assets or liabilities.

Quoted prices for similar assets and liabilities in active markets or inputs that are observable.

Inputs that are unobservable (for example, cash flow modeling inputs based on assumptions).

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

Transfer into and transfers out of the

hierarchy levels are recognized as if they had taken place at the end of the reporting period.

There have been no changes in Level

1, Level 2, and Level 3 and no changes in valuation.

The fair value of the Company’s equity-based investment in SG DevCorp was determined

based on Level 1 inputs.

The Company does not have any financial instruments in the Level 2 or Level 3 category.

Fair value measured as of September 30, 2025

September 30,

Significant other observable inputs

Significant unobservable inputs

Equity-based investment – SG DevCorp

The Company measures the fair value of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value.

The Company uses three levels of inputs that may be used to measure fair value:

Level 1 Quoted prices in active markets for identical assets or liabilities.

Level 2 Quoted prices for similar assets and liabilities in active markets or inputs that are observable.

Level 3 Inputs that are unobservable (for example, cash flow modelling inputs based on assumptions).

Transfer into and transfers out of the hierarchy levels are recognized as if they had taken place at the end of the reporting period.

There have been no changes in Level 1, Level 2, and Level 3 categorizations and no changes in valuation techniques.

The Company’s derivative liabilities are measured at fair value using Level 3 inputs.

The Company does not have any financial instruments categorized within Level 1 or Level 2.

Fair value measured as of March 31, 2026

Total (Level 1) (Level 2) (Level 3)

Derivative liabilities $ 72,157 $ — $ — $ 72,157

Fair value measured as of December 31, 2025

September 30,

Significant other observable inputs

Significant unobservable inputs

Equity-based investment – SG DevCorp

Share-based payments – The

Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award.

employees and directors, including non-employee directors, the fair value of a stock option award is measured on the grant date.

value amount is then recognized over the period services are required to be provided in exchange for the award, usually the vesting period.

The Company recognizes stock-based compensation expense on a graded-vesting basis over the requisite service period for each separately

vesting tranche of each award.

Stock-based compensation expense to employees and all directors are reported within payroll and

related expenses in the consolidated statements of operations.

Stock-based compensation expense to non-employees is reported within marketing

and business development expense in the condensed consolidated statements of operations.

Income taxes – The

Company accounts for income taxes utilizing the asset and liability approach.

Under this approach, deferred taxes represent the future

tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid.

The provision for income

taxes generally represents income taxes paid or payable for the current year plus the change in deferred taxes during the year.

taxes result from the differences between the financial and tax bases of the Company’s assets and liabilities and are adjusted for

changes in tax rates and tax laws when changes are enacted.

The calculation of tax liabilities involves

dealing with uncertainties in the application of complex tax regulations.

The Company recognizes liabilities for anticipated tax audit

issues based on the Company’s estimate of whether, and the extent to which, additional taxes will be due.

If payment of these amounts

ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when

the liabilities are no longer determined to be necessary.

If the estimate of tax liabilities proves to be less than the ultimate assessment,

a further charge to expense would result.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Summary of Significant Accounting Policies (continued)

2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, extending key provisions of the 2017 Tax Cuts and Jobs

Act including, but not limited to, the restoration of 100 % bonus depreciation, the introduction of new Section 174A permitting immediate

expensing of domestic research and experimental expenditures, modifications to Section 163(j) interest expense limitations, updates to

the rules governing global intangible low-taxed income, amendments to energy credit provisions, and the expansion of Section 162(m) aggregation

requirements.

The Company is currently assessing the impact of the OBBBA and an estimate of the impact on the Company’s consolidated

financial statements is not yet available.

Concentrations of credit risk

– Financial instruments, that potentially subject the Company to concentration of credit risk, consist principally

of cash and cash equivalents.

The Company places its cash with high credit quality institutions.

At times, such amounts may be in excess

of Federal Deposit Insurance Corporation insurance limits.

The Company has not experienced any losses in such account and believes that

it is not exposed to any significant credit risk on the account.

With respect to receivables, concentrations

of credit risk are limited to a few customers in the construction industry.

The Company performs ongoing credit evaluations of its customers’

financial condition and, generally, requires no collateral from its customers other than normal lien rights.

At September 30, 2025 and

December 31, 2024, 100 % of the Company’s gross accounts receivable were due from three customers.

Revenue relating to two and one

customer represented approximately 71 % and 84 % of the Company’s total revenue for the three months

ended September 30, 2025 and 2024, respectively.

Revenue relating to two and one customer represented approximately 65 % and 75 %, for the

nine months ended September 30, 2025 and 2024, respectively.

There were no vendors representing 10%

or more of the Company’s total cost of revenue for the three months or nine months ended September 30, 2025 and 2024.

believes it has access to alternative suppliers, with limited disruption to the business, should circumstances change with its existing

Other income –

In 2020, the World Health Organization publicly characterized COVID-19 as a pandemic.

The Company recognized a substantial amount of incremental

costs during the pandemic, including costs to compensate employees who were not able to work due to facility closures, reduced work schedules

or health related reasons.

The Coronavirus Aid, Relief, and Economic Security Act was signed into law in March 2020, which provided, among

other things, an employee retention credit to eligible employers who paid qualified wages to employees during the pandemic.

retention credit represents a government grant.

The Company’s policy is to recognize government grants when they are reasonably

assured of receipt.

The company recognized employee retention tax credits totaling $ 592,253 during the nine months ended September 30,

2025, after concluding the recognition threshold had been met.

All such credits were classified as other income.

Additionally, during the nine months

ended September 30, 2025, the Company received $ 2,000,000 from a legal settlement and disclosed in Note 15.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Total (Level 1) (Level 2) (Level 3)

Derivative liabilities $ 70,802 $ — $ — $ 70,802

The following table presents the roll forward of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended March 31, 2026:

Balance at December 31, 2025 $ 70,802

Settlements —

Change in fair value included in earnings 1,355

Transfers into (out of) Level 3 —

Balance at March 31, 2026 $ 72,157

All changes in the fair value of the embedded derivative conversion features are recorded within “Change in fair value of derivatives” on the condensed consolidated statements of operations.

There were no transfers into or out of Level 3 during either period.

Accounting Standards Recently Adopted

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and are adopted by the Company as of the specified effective date.

There have been no material changes to the Company’s significant accounting policies or recent accounting pronouncements adopted during the three months ended March 31, 2026, from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2025.

Recent Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU No.

2024-03, Disaggregation of Income Statement Expenses .

This guidance will require additional disclosures and disaggregation of certain costs and expenses presented on the face of the income statement.

The amendments are effective for annual reporting periods beginning after December 15, 2026 and interim reporting period beginning after December 15, 2027 with early adoption permitted.

The Company is currently evaluating the impact of this new guidance to its condensed consolidated financial statements.

The Company’s management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying condensed consolidated financial statements.

ACCOUNTS RECEIVABLE

At September 30, 2025 and December 31, 2024, the Company’s

accounts receivable consisted of the following:

Construction services

Total gross receivables

At March 31, 2026 and December 31, 2025, the Company’s accounts receivable, net consisted of the following:

2026 December 31,

Billed Construction services $ 707,056 $ 719,016

allowance for credit losses ( 401,774 ) ( 401,774 )

Total net receivables $ 305,282 $ 317,242

Receivables are evaluated for collectability

and allowances for potential losses are established or maintained on applicable receivables.

Changes in the Company’s allowance for credit losses for the three months ended March 31, 2026 and the year ended December 31, 2025 consisted of the following:

Beginning balance $ 401,774 $ 266,795

Recoveries of credit losses — —

Additional credit losses recognized — 134,979

Total allowance for credit losses $ 401,774 $ 401,774

CONTRACT ASSETS AND CONTRACT LIABILITIES

Costs and estimated earnings on uncompleted

contracts, which represent contract assets and contract liabilities, consisted of the following at September 30, 2025 and December

Costs and estimated earnings on uncompleted contracts, which represent contract assets and contract liabilities, consisted of the following:

2026 December 31,

Costs incurred on uncompleted contracts $ 558,692 $ 321,479

Provision for loss on uncompleted contracts

Estimated earnings to date on uncompleted contracts 153,649 243,977

( 1,266,645 )

Gross contract assets 712,341 565,456

billings to date ( 1,063,865 ) ( 937,032 )

( 2,105,654 )

( 3,066,938 )

Net contract liabilities on uncompleted contracts $ ( 351,524 ) $ ( 371,576 )

$ ( 222,797 )

$ ( 593,546 )

The above amounts are included in the

accompanying condensed consolidated balance sheets under the following captions at September 30, 2025 and December 31, 2024.

Contract assets

Contract liabilities

Net contract liabilities on uncompleted contracts

$ ( 222,797 )

$ ( 593,546 )

Although management believes it has

established adequate procedures for estimating costs to complete on open contracts, it is at least reasonably possible that additional

significant costs could occur on contracts prior to completion.

The Company periodically evaluates and revises its estimates and

makes adjustments when they are considered necessary.

Additionally, at September 30, 2025 contract liabilities include $ 552,500

of advanced payments from customers on certain contracts.

The total amount of contract liabilities amounted to $ 823,648 and $ 596,082 as

of September 30, 2025 and December 31, 2024, respectively.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Oil and Gas Properties and Property, plant and equipment

Oil and gas properties include the cost

of properties, equipment and facilities for oil and natural-gas producing activities, excluding any asset retirement obligations.

30, 2025, the Company’s oil and gas properties, net consisted of the following:

Oil and gas properties

accumulated depreciation

Included in oil and gas, on the basis of full cost accounting, net

on the accompanying condensed consolidated balance sheet is $ 185,074 for the Company’s asset retirement obligation asset balance.

Property, plant and equipment are stated

at cost less accumulated depreciation and amortization and depreciated using the straight-line method over their useful lives.

30, 2025 and December 31, 2024, the Company’s property, plant and equipment, net consisted of the following:

Computer equipment and software

Furniture and other equipment

Leasehold improvements

Equipment and machinery

Property, plant and equipment

accumulated depreciation

( 1,746,977 )

Depreciation expense for the nine

months ended September 30, 2025 and 2024 amounted to $ 518,563 and $ 189,869 , respectively.

Depreciation expense for the three

months ended September 30, 2025 and 2024 amounted to $ 119,720 and $ 105,191 , respectively.

Notes Payable

Authority Loan Agreement

On October 29, 2021, SG Echo entered into a Loan Agreement (the “Authority

Loan Agreement”) with the Durant Industrial Authority (the “Authority”) pursuant to which it issued to the Authority

a non-interest bearing Forgivable Promissory Note in the principal amount of $ 750,000 (the “Forgivable Note”) in exchange

for $ 750,000 to be used for renovation improvements related to the Company’s approximately 58,000 square-foot manufacturing facility

in Durant, Oklahoma.

The Forgivable Note is due on April 29, 2029 and guaranteed by the Company, provided that, if no event of default

has occurred under the Forgivable Note or the Authority Loan Agreement, one-third (1/3) of the balance of the Forgivable Note will be

forgiven on April 29, 2027, one-half (1/2) of the balance of the Forgivable Note will be forgiven on April 29, 2028, and the remainder

of the balance of the Forgivable Note will be forgiven on April 29, 2029.

The Loan Agreement includes a covenant by SG Echo to employ

a minimum of 75 full-time employees in Durant, Oklahoma and pay them no less than 1.5 times the federal minimum wage, and provides SG

Echo 24 months to comply with the provision.

As of September 30, 2025 and December 31, 2024 the outstanding balance amounted to $ 750,000 .

Additionally, as of September 30, 2025, the above requirements have not been met for the outstanding balance to be forgiven, however the

Company has a cure period of twenty four months.

See Note 15, for additional information

regarding litigation between the Company and Authority.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

Cash Advance Agreements

On July 31, 2024, SG Building entered

into a Cash Advance Agreement (the “July Cash Advance Agreement”) with Cedar Advance LLC (“Cedar”)pursuant to

which SG Building sold to Cedar $ 1,957,150 of its future receivables for a purchase price of $ 1,350,000 , less underwriting fees and expenses

paid and the repayment of prior amounts due Cedar, for net funds provided of $ 285,180 , which are net of repayment of prior Cedar Cash

Advance Agreements

Pursuant to the July Cash Advance Agreement,

Cedar is expected to withdraw $ 49,150 a week directly from SG Building until the $ 1,957,150 due to Cedar under the July Cash Advance Agreement

is paid in full.

In the event of a default (as defined in the July Cash Advance Agreement), Cedar, among other remedies, can demand payment

in full of all amounts remaining due under the July Cash Advance Agreement.

SG Building’s obligations under the July Cash Advance

Agreement have been guaranteed by SG Echo.

The July Cash Advance Agreement is currently in default.

As of September 30, 2025 and December

31, 2024 the outstanding balance amounted to $ 1,526,699 and $ 1,536,700 , respectively.

On August 27, 2024, SG Building entered

into a Cash Advance Agreement (the “Pawn Cash Advance Agreement”) with Pawn Funding (“Pawn”) pursuant to which

SG Building sold to Pawn $ 599,600 of its future receivables for a purchase price of $ 400,000 , less underwriting fees and expenses paid

and the repayment of prior amounts due Pawn, for net funds provided of $ 360,000 .

Pursuant to the Pawn Cash Advance Agreement, Pawn is

expected to withdraw $ 4,999.67 a week directly from SG Building until the $ 599,600 due to Pawn is paid in full.

In the event of a default

(as defined in the Pawn Cash Advance Agreement), Pawn, among other remedies, can demand payment in full of all amounts remaining due under

the Pawn Cash Advance Agreement.

As of September 30, 2025 and December 31, 2024 the outstanding balance amounted to $ 249,830 .

On December 17, 2024, SG Building entered

into a Cash Advance Agreement (the “December Cash Advance Agreement”) with Cedar pursuant to which SG Building sold to Cedar

$ 194,500 of its future receivables for a purchase price of $ 138,000 , less underwriting fees and expenses paid, for net funds provided

of $ 125,000 .

Pursuant to the Cedar Cash Advance Agreement, Cedar is expected to withdraw $ 4,900 a week directly from SG Building until

the $ 194,500 due to Cedar is paid in full.

In the event of a default (as defined in the Cedar Cash Advance Agreement), Cedar, among other

remedies, can demand payment in full of all amounts remaining due under the Cedar Cash Advance Agreement.

As of September 30, 2025

and December 31, 2024 the outstanding balance amounted to $ 57,272 and $ 184,700 , respectively.

On December 24, 2024, SG Building entered

into a Cash Advance Agreement (the “December Cash Advance Agreement 2”) with Cedar”) pursuant to which SG Building sold

to Cedar $ 203,000 of its future receivables for a purchase price of $ 140,000 , less underwriting fees and expenses paid, for net funds

provided of $ 126,000 .

Pursuant to the December Cedar Cash Advance Agreement 2, Cedar is expected to withdraw $ 5,000 a week directly from

SG Building until the $ 203,000 due to Cedar is paid in full.

In the event of a default (as defined in the Cedar Cash Advance Agreement),

Cedar, among other remedies, can demand payment in full of all amounts remaining due under the Cedar Cash Advance Agreement.

September 30, 2025 and December 31, 2024 the outstanding balance amounted to $ 132,898 and $ 203,000 , respectively.

On January 22, 2025, SG Building entered

into a Cash Advance Agreement (the “Core Cash Advance Agreement”) with Core Funding Source LLC (“Core”) pursuant

to which SG Building sold to Pawn $ 104,930 of its future receivables for a purchase price of $ 70,000 , less underwriting fees and expenses

paid, for net funds provided of $ 63,000 .

Pursuant to the Core Cash Advance Agreement, Core is expected to receive $ 2,998 a day directly

from SG Building until the $ 104,930 due to Core is paid in full.

In the event of a default (as defined in the Core Cash Advance Agreement),

Core, among other remedies, can demand payment in full of all amounts remaining due under the Core Cash Advance Agreement.

As of September

30, 2025 the outstanding balance amounted to $ 0 .

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

Enhanced Note

On September 20, 2024, SG Echo entered

into a Loan and Security Agreement (the “Enhanced Loan Agreement”) with Enhanced Capital Oklahoma Rural Fund, LLC (“Enhanced”)

pursuant to which SG Echo borrowed $ 4,000,000 (the “Principal”) from Enhanced, and whereby SG Echo executed and delivered

a Secured Promissory Note (the “Enhanced Note”) to Enhanced to evidence SG Echo’s obligations under the Enhanced Loan

The Enhanced Note shall bear interest at a rate equal to the greater of (i) the Secured Overnight Financing Rate (“SOFR”)

plus six and sixty-five tenths percent ( 6.65 %) and (ii) ten percent ( 10.0 %) per annum (the “Interest Rate”).

SG Echo shall

pay to Enhanced a closing fee of $ 80,000 , which shall be due and payable on October 1, 2025, unless such date shall be extended by Lender.

SG Echo’s obligations under the Enhanced Loan Agreement and the Enhanced Note have been guaranteed by the Company.

Pursuant to the terms of the Enhanced

Note, SG Echo shall make monthly payments of accrued interest on the first business day of each calendar month until December 31, 2025.

Commencing January 2026, SG Echo shall make monthly payments of accrued interest and additionally shall make a monthly principal payment

on the Note in an amount equal to $ 22,222.22 .

The maturity date of the Note shall be the sixty-month anniversary of the closing date (the

“Enhanced Maturity Date”).

All outstanding principal and accrued interest shall be due and payable on the Enhanced Maturity

Pursuant to the terms of the Enhanced

Loan Agreement, on the closing date, $ 360,000 (the “Interest Reserve”) will be deposited in a segregated deposit account in

SG Echo’s name, which account shall be subject to a Control Agreement in favor of the Lender (the “Interest Reserve Account”).

The monthly payments due under the Enhanced Note are withdrawn from the Interest Reserve Account until the Interest Reserve has been fully

SG Echo shall have no obligation to replenish amounts withdrawn from the Interest Reserve Account.

Pursuant to the terms of the Enhanced

Loan Agreement, SG Echo shall grant Enhanced a first priority mortgage on the real property located at 101 Waldron Rd., Durant, Oklahoma.

Additionally, SG Echo shall grant Lender a continuing security interest in, a general lien upon, collateral assignment of, and a right

of set-off against all of SG Echo’s right, title, and interest in and to all assets of SG Echo.

In the event of default (as defined

in the Enhanced Loan Agreement), Enhanced, among other remedies, can demand all amounts and/or liabilities owing from time to time by

SG Echo to Enhanced pursuant to the Enhanced Loan Agreement and the Enhanced Note (with accrued interest thereon) and all other amounts

owing under the Enhanced Loan Agreement due and payable.

As of September 30, 2025 and December 31, 2024 the outstanding balance amounted

to $ 4,000,000 .

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

Notes Payable (continued)

Galvin Promissory Note

On December 14, 2023, the Company entered

into a promissory note with Paul Galvin, the Company’s Chairman and CEO, for $ 75,000 (“Galvin Note Payable”).

shall not accrue interest, and the entire unpaid principal balance is due December 14, 2024.

During the three months ended March 31, 2024

the Company entered into an additional promissory note with Mr.

Galvin in the amount of $ 10,000 .

The note shall not accrue interest, and

the entire unpaid principal balance is due December 14, 2024.

During the three months ended, $ 0 in principal payments were made.

Galvin Note Payable is currently in default.

As of September 30, 2025 and December 31, 2024 the outstanding balance amounted to $ 17,805

and $ 17,000 , respectively.

1800 Diagonal Note

On March 5, 2024, the Company issued

a promissory note (the “1800 Diagonal Note”) in favor of 1800 Diagonal Lending LLC (“1800 Diagonal”)

in the aggregate principal amount of $ 149,500 pursuant to a Securities Purchase Agreement, dated March 5, 2024 (the “SPA”).

The 1800 Diagonal Note was purchased

by 1800 Diagonal for a purchase price of $ 130,000 , representing an original issue discount of $ 19,500 .

A one-time interest charge

of ten percent ( 10 %) (the “Interest Rate”) will be applied on the issuance date to the Principal.

Under the terms of the 1800

Diagonal Note, beginning on April 15, 2024, the Company is required to make nine monthly payments of accrued, unpaid interest and outstanding

principal, subject to adjustment, in the amount of $ 18,272,23 .

The Company shall have a five-business day grace period with respect to

each payment.

Any amount of principal or interest on this 1800 Diagonal Note which is not paid when due will bear interest at the rate

of 22 % per annum from the due date thereof until the same is paid (“Default Interest”).

The Company has right to accelerate

payments or prepay in full at any time with no prepayment penalty.

Among other things, an event of default

will be deemed to have occurred if the Company fails to pay the principal or interest when due on the 1800 Diagonal Note, whether at maturity,

upon acceleration or otherwise, if bankruptcy or insolvency proceedings are instituted by or against the Company or if the Company fails

to maintain the listing of its common stock on The Nasdaq Stock Market.

Upon the occurrence of an event of default, the 1800 Diagonal

Note will become immediately due and payable and the Company will be obligated to pay to the Investor, in satisfaction of its obligations

under the 1800 Diagonal Note, an amount equal to 200 % times the sum of the then outstanding principal amount of the 1800 Diagonal Note

plus accrued and unpaid interest on the unpaid principal amount of this 1800 Diagonal Note to the date of payment plus Default Interest,

After an event of default, at any time

following the six month anniversary of the 1800 Diagonal Note, 1800 Diagonal will have the right, to convert all or any

part of the outstanding and unpaid amount of the 1800 Diagonal Note into shares of the Company’s common stock at a conversion

price equal to the greater of $ 0.08 ($ 5.12 as adjusted for the September Stock Split) or 65 % multiplied by the lowest closing bid price

during the 10 trading days prior to the conversion date (representing a discount rate of 35 %).

The 1800 Diagonal Note may not be

converted into shares of the Company’s common stock if the conversion would result in 1800 Diagonal and its affiliates owning

an aggregate of in excess of 4.99 % of the then outstanding shares of the Company’s common stock.

In addition, unless the Company

obtains shareholder approval of such issuance, the Company shall not issue a number of shares of its common stock under 1800 Diagonal Note,

which when aggregated with all other securities that are required to be aggregated for purposes of Nasdaq Rule 5635(d), would exceed 19.99 %

of the shares of the Company’s common stock outstanding as of the date of definitive agreement with respect to the first of such

aggregated transactions (the “Conversion Limitation”).

Upon the occurrence of an event of default as a result of the Company

being delisted from Nasdaq, the Conversion Limitation shall no longer apply.

As of September 30, 2025 and December 31, 2024 the outstanding

balance amounted to $ 0 and $ 135,334 , respectively.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

On August 28, 2024, the Company issued

a promissory note (the “August 1800 Diagonal Note”) in favor of 1800 Diagonal in the principal amount of $ 290,000

for a purchase price of $ 250,000 , representing an original issue discount of $ 40,000 .

A one-time interest charge of twelve percent

( 12 %) be applied on the issuance date to the principal balance.

Under the terms of the August 1800 Diagonal Note, beginning

on February 28, 2025, the Company is required to make five monthly payments of accrued, unpaid interest and outstanding

principal, subject to adjustment, in the amount of $ 40,600 , with $ 162,400 being due on February 28, 2025.

The Company has right to accelerate

payments or prepay in full at any time with no prepayment penalty.

The connection with the August 1800 Diagonal Note, the Company incurred

$ 8,000 in debt issuance costs.

The August 1800 Diagonal Note has default terms similar to the 1800 Diagonal Note as described above.

of September 30, 2025 and December 31, 2024 the outstanding balance amounted to $ 0 and $ 290,000 , respectively.

On January 22, 2025, the Company issued

a promissory note (the “January 1800 Diagonal Note”) in favor of 1800 Diagonal in the principal amount of $ 143,750

for a purchase price of $ 125,000 , representing an original issue discount of $ 18,750 .

A one-time interest charge of twelve percent

(15%) be applied on the issuance date to the principal balance.

Under the terms of the January 1800 Diagonal Note, beginning

on February 28, 2025, the Company is required to make nine monthly payments of accrued, unpaid interest and outstanding

principal, subject to adjustment, in the amount of $ 18,368 , with $ 165,310 being due on February 28, 2025.

The Company has right to accelerate

payments or prepay in full at any time with no prepayment penalty.

The connection with the January 1800 Diagonal Note, the Company incurred

$ 8,000 in debt issuance costs.

The January 1800 Diagonal Note has default terms similar to the 1800 Diagonal Note as described above.

As of September 30, 2025 the outstanding balance amounted to $ 0 .

During the nine months ended September

30, 2025, 1800 Diagonal converted their entire remaining principal balance into 9,963 shares of common stock.

The conversions were not

within the terms of the underlying agreements and the Company recorded a loss on conversion of notes payable in the amount of $ 189,722

during the nine months ended September 30, 2025.

On February 12, 2025, the Company executed

and issued a Promissory Note (“Note”) in favor of Firstfire Global Opportunities Fund, LLC (the “Firstfire”) in

the aggregate principal amount of $ 360,000 (the “Firstfire Principal”), and an accompanying Securities Purchase Agreement,

executed on February 12, 2025 (the “Firstfire SPA”).

The Note was purchased by Firstfire

for a purchase price of $ 300,000 , representing an original issue discount of $ 60,000 .

The Note shall bear interest at a rate of fifteen

percent ( 15 %) per annum, with the understanding that the first twelve months of interest under the Note (equal to $ 54,000 ), shall be guaranteed

and earned in full as of February 12, 2025.

Any amount of Principal or interest due under the Note which is not paid when due shall bear

interest at eighteen percent ( 18 %) per annum (“Default Interest”).

The Note may not be prepaid in whole or in part except

as explicitly set forth in the Note.

Firstfire will have the right, on any

calendar day, at any time on or after the Issue Date, to convert all or any portion of the then-outstanding Principal and interest (including

any Default Interest) into fully paid and non-assessable shares of common stock, par value $ 0.01 per share, of the Company (the “Common

The per share conversion price into which the Principal, interest (including any Default Interest) shall be equal to $ 0.65

($ 7.80 as adjusted for the September Stock Split), subject to adjustment as provided in the Note (the “Conversion Price”).

If at any time the Conversion Price for any conversion would be less than the par value of the Common Stock, then at the sole discretion

of the Lender, the Conversion Price may equal such par value for such conversion, and the conversion amount shall be increased to include

Additional Principal (where “Additional Principal” means such additional amount to be added to the conversion amount to the

extent necessary to cause the number of conversion shares issuable upon such conversion to equal the same number of conversion shares

as would have been issued if the Conversion Price had not been adjusted by the Lender to the par value price.

The Lender shall be entitled

to deduct $ 1,750 from the conversion amount in each notice of conversion to cover Lender’s fees associated with each notice of conversion.

The Note may not be converted into shares of the Company’s common stock if the conversion would result in the Lender and its affiliates

owning an aggregate of in excess of 4.99 % of the then-outstanding shares of the Company’s common stock.

In connection with the issuance of the

Note and the SPA, the Company will issue to the Lender common stock purchase warrants (the “Warrant”), which shall be exercisable

into 450,000 shares of Common Stock ( 37,500 as adjusted for the September Stock Split).

The relative fair value of the warrants amounted

to $ 158,883 and are recorded as a debt discount to the underlying Note.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

Among others, the following shall be

considered events of default under the Note (“Event of Default”):

if the Company fails to pay the Principal Amount or interest

when due on the Note;

the Company fails to issue conversion shares to the Lender upon exercise by the Lender of the conversion rights

under the Note;

or the Company breaches any covenant, agreement, or other term or condition of the Note or the accompanying Securities

Purchase Agreement, Registration Rights Agreement, Irrevocable Transfer Agent Instructions, or Warrants.

After an Event of Default, in addition

to all other rights under the Note, the Lender shall have the right to convert any portion of the Note at any time at a price per share

equal to the Alternate Price.

The “Alternate Price” shall mean the lesser of (i) the applicable conversion price under the

Note, (ii) the closing price of the Common Stock on the date of the Event of Default, or (iii) $ 0.52 ($ 33.28 as adjusted for the September

Stock Split).

As of September 30, 2025 the outstanding balance amounted to $0 .

On March 6, 2025, the Company closed

and issued a promissory note (the “Note”) in favor of Tysadco Partners LLC (the “Tysadco”), with an effective

date of February 25, 2025, in the aggregate principal amount up to $ 1,875,000 (the “Principal”), and an accompanying Securities

Purchase Agreement (the “SPA”).

All outstanding Principal and interest shall be due on November 30, 2025 (the “Maturity

The Note was purchased for up to $ 1,500,000 , representing an original issue discount of twenty-five percent ( 25 %), equal

to $ 375,000 if the Note is fully funded.

The Note shall bear interest at twelve percent ( 12 %) interest per annum.

Tysadco has the right

to convert all or any portion of the then-outstanding Principal and interest into fully paid and non-assessable shares of common stock

of the Company, par value $ 0.01 per share (the “Conversion Shares”).

The per share conversion price into which the Principal

and interest converts shall be fifty cents ($ 0.50 ) per share ($ 32 as adjusted for the September Stock Split).

Among others, the following

shall be considered events of default under the Note (each an “Event of Default”):

if the Company fails to pay the Principal

or interest when due under the Note;

if the Company fails to issue Conversion Shares to Tysadco upon exercise by Tysadco of the conversion

rights under the Note;

or if the Company breaches any covenant, agreement, or other term or condition of the Note or the accompanying

Upon the occurrence of an Event of Default, then the outstanding balance shall immediately increase to 125 % of the outstanding balance

immediately prior to the occurrence of the Event of Default, and a daily penalty of $ 500 will accrue until the default is remedied.

If the Company has not obtained approval

from the holders of the Company’s Common Stock, as required by applicable rules and regulation of Nasdaq, the Company shall not

issue any number of shares of Common Stock under the Note that would exceed 4.99 % of the shares of Common Stock outstanding as of the

date of the Note.

Additionally, the Company shall not effect any conversion of the Note, and the Lender shall not have the right to convert

any portion of the Note or receive shares of Common Stock as payment of interest hereunder to the extent that after giving effect to such

conversion or receipt of such interest payment, the Lender, together with any affiliates thereof, would beneficially own in excess of

4.99 % of the number of shares of Common Stock outstanding immediately after giving effect to such conversion or receipt of shares as payment

In connection with the issuance of the

Note and the SPA, the Company will issue 294,000 shares of Common Stock ( 4,594 as adjusted for the September Stock Split) (the “Commitment

Shares”) as additional consideration for the purchase of the Note.

As of September 30, 2025 the outstanding balance amounted to

During the nine months ended September 30, 2025, Tysadco and the Company

entered into an agreement to convert their entire principal balance into 515,625 shares of common stock, of which 190,000 shares of common

stock were formally issued as of September 30, 2025 (“Tysadco Conversion”).

The Company recorded common stock to be issued

in the amount of $ 3,381,436 for the value of the remaining shares to be issued.

The conversion was not within the terms of the underlying

agreements and the Company recorded a loss on conversion of notes payable in the amount of $ 4,725,487 during the nine months ended September

On March 3, 2025, the Company executed

and issued a Promissory Note (“Note”) in favor of GS Capital Partners, LLC (the “GS”) in the aggregate principal

amount of $ 360,000 (the “Principal”), and an accompanying Securities Purchase Agreement (the “SPA”) and Registration

Rights Agreement (the “RRA”).

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

The Note was purchased by GSA for a

purchase price of $ 300,000 , representing an original issue discount of $ 60,000 .

The Note shall bear interest at a rate of fifteen percent

( 15 %) per annum, with the understanding that the first twelve months of interest under the Node (equal to $ 54,000 ), shall be guaranteed

and earned in full as of the Issue Date.

Any amount of Principal or interest due under the Note which is not paid when due shall bear

interest at eighteen percent ( 18 %) per annum (“Default Interest”).

The Note may not be prepaid in whole or in part except

as explicitly set forth in the Note.

The Company shall make monthly payments on the Note in the amount of $ 44,000 , due and payable on

the 3 rd of each month commencing on June 3, 2025, and ending on February 3, 2025, with a final payment due and payable

on March 3, 2026, in the amount equal to any remaining outstanding balance of the Note.

GSA will have the right to convert all

or any portion of the then-outstanding Principal and interest including any Default Interest (as defined in the Note) into fully paid

and non-assessable shares of common stock of the Company, par value $ 0.01 per share (the “Common Stock”).

Such conversion

right is wholly contingent and subject to the approval of such conversion by a sufficient amount of holders of the Company’s common

stock to satisfy the shareholder approval requirements for such action as provided in Nasdaq Rule 5635(d) (“Shareholder Approval”).

GSA may, on any calendar day, at any time after Shareholder Approval of such conversion, convert all or any portion of the then-outstanding

Principal and interest (including any Default Interest) into fully paid and non-assessable share of common stock, par value $ 0.01 per

share, of the Company (the “Common Stock”).

The per share conversion price into which the Principal, interest (including any

Default Interest) shall be equal to $ 0.65 ($ 41.60 as adjusted for the September Stock Split), subject to adjustment as provided in the

Note (the “Conversion Price”).

If at any time the Conversion Price for any conversion would be less than the par value of

the Common Stock, then at the sole discretion of GSA, the Conversion Price may equal such par value for such conversion, and the conversion

amount shall be increased to include Additional Principal (where “Additional Principal” means such additional amount to be

added to the conversion amount to the extent necessary to cause the number of conversion shares issuable upon such conversion to equal

the same number of conversion shares as would have been issued if the Conversion Price had not been adjusted by GSA to the par value price.

GSA shall be entitled to deduct $ 1,750 from the conversion amount in each notice of conversion to cover GSA’s fees associated with

each notice of conversion.

The Note may not be converted into shares of the Company’s common stock if the conversion would result

in GSA and its affiliates owning an aggregate of in excess of 4.99 % of the then-outstanding shares of the Company’s common stock.

Among others, the following shall be

considered events of default under the Note (“Event of Default”):

if the Company fails to pay the Principal Amount or interest

when due on the Note;

the Company fails to issue conversion shares to GSA upon exercise by GSA of the conversion rights under the Note;

or the Company breaches any covenant, agreement, or other term or condition of the Note or the accompanying Securities Purchase Agreement,

Registration Rights Agreement, Irrevocable Transfer Agent Instructions, or Warrants.

After an Event of Default, in addition

to all other rights under the Note, GSA shall have the right to convert any portion of the Note at any time at a price per share equal

to the Alternate Price.

The “Alternate Price” shall mean the lesser of (i) the applicable conversion price under the Note,

(ii) the closing price of the Common Stock on the date of the Event of Default, or (iii) $ 0.52 ($ 33.28 as adjusted for the September Stock

As of September 30, 2025 the outstanding balance amounted to $ 316,000 , and the note is in default.

Generating Alpha

On March 27, 2025, the Company executed

and issued a Promissory Note (“Note”) in favor of Generating Alpha Ltd.

(the “Generating”) in the aggregate principal

amount of $ 375,700 (the “Principal”), and an accompanying Securities Purchase Agreement (the “SPA”) and Registration

Rights Agreement (the “RRA”).

The Note was purchased by Generating

for a purchase price of $ 300,560 , representing an original issue discount of $ 75,140 .

The Note shall bear interest at a rate of fifteen

percent ( 15 %) per annum, with the understanding that the first twelve months of interest under the Node (equal to $ 56,355 ), shall be guaranteed

and earned in full as of March 27, 2025.

Any amount of Principal or interest due under the Note which is not paid when due shall bear

interest at eighteen percent ( 18 %) per annum (“Default Interest”).

The Company shall make monthly payments on the Note (each

an “Amortization Payment”) in the amount of $ 43,205.50 , due and payable on the 6 th of each month commencing

on June 6, 2025, and ending on March 6, 2026.

The Company may accelerate the payment date of any Amortization Payment by giving notice

to Generating.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

If the Company fails to pay any Amortization

Payment when due, in addition to all other rights under the Note, Generating shall have the right to convert at any time any portion of

the Note at a price per share equal to the Market Price.

“Market Price” shall mean the lesser of (i) the then applicable conversion

price under the Note or (ii) 80 % of the lowest closing price of the Company’s shares of common stock, par value $ 0.01 (“Common

Stock”) on any trading day during the ten trading days prior to the conversion date.

If an event of default occurs under the Note,

then, in addition to all other rights under the Note, the Lender shall have the right to convert at any time any portion of the Note at

a price per share equal to the Alternate Price.

“Alternate Price” shall mean the lesser of (i) the then applicable conversion

price, (ii) the closing price of the Common Stock on the date of the event of default (provided, however, that if such date is not a trading

day, then the next trading day after the event of default), or (iii) $ 0.52 ($ 33.28 as adjusted for the September Stock Split) (subject

to adjustment as provided in the Note).

The total cumulative number of shares

of Common Stock issued to Generating under the Note, together with the SPA and RRA, may not exceed the requirements of Nasdaq Listing

Rule 5635(d) (the “Nasdaq 19.99 % Cap”), except that is the number of shares of Common Stock issued to Lender reaches the Nasdaq

19.99 % Cap, the Company, at its election, will use reasonable commercial efforts to obtain stockholder approval of the Note and the issuance

of additional conversion shares, in accordance with the requirements of Nasdaq Listing Rule 5635(d) (the “Approval”).

Company is unable to obtain such Approval, any remaining outstanding balance of the Note must be repaid in cash.

Among others, the following shall be

considered events of default under the Note (“Event of Default”):

if the Company fails to pay an Amortization Payment when

due on the Note;

the Company fails to perform or observe any covenant, term, provision, condition, agreement, or obligation of the Company

under the Note, the SPA, or the RRA;

the Company shall make an assignment for the benefit of creditors, or apply for or consent to the

appointment of a receiver or trustee for it or for a substantial part of its property or business.

After an Event of Default, in addition to all other rights under the Note, Generating shall have the right to convert any portion of the Note at any time at a price per share equal to the Alternate Price.

The “Alternate Price” shall mean the lesser of (i) the applicable conversion price under the Note, (ii) the closing price of the Common Stock on the date of the Event of Default, or (iii) $ 0.52 ($ 33.28 as adjusted for the September Stock Split).

As of September 30, 2025 the outstanding balance amounted to $ 375,000 , and the note is in default.

On June 3, 2025 (the “Effective

Date”), Olenox entered into a Promissory Note (the “Note”) in favor of Prosperity Bank (the “Lender”) in

the aggregate principal amount of $ 2,000,000 (the “Principal”).

The Note evidences a revolving Line of Credit of Olenox with

Olenox received net loan proceeds of $ 1,960,000 through September 30, 2025.

The Note is secured by the Company’s Certificate

of Deposit held with the Lender with an approximate balance of $ 2,000,000 .

The Note shall bear interest at a rate

of five percent ( 5 %) per annum.

Interest shall be calculated based on a year of 360 days.

The Note shall be due in full immediately upon

Lender’s demand.

If no demand is made, Borrower will pay all outstanding principal and all accrued unpaid interest on June 2, 2026.

In addition, the Borrower will pay regular monthly payments of all accrued interest due as of each payment date, beginning July 2, 2025.

The Borrower may prepay all or a portion of the principal without penalty earlier than it is due.

If a payment is 10 days or more late,

the Borrower will be charged a late charge 5.00 % of the unpaid portion of the regular payment.

The Lender reserves a right of setoff in

all of the Borrower’s accounts with the Lender (whether checking, savings, or some other account).

The Borrower authorizes the Lender,

to the extent permitted by applicable law, to charge or setoff all sums owing on the indebtedness against any and all such accounts.

Note provides for a commercial guaranty by Michael McLaren.

Among others, the following shall constitute

an event of default under the Note (each an “Event of Default”):

if the Borrower fails to make any payment when due under

if the Borrower fails to comply with or to perform any other term, obligation, covenant, or condition contained in the Note

or any related documents;

any representation or statement made by the Borrower to the Lender is false or misleading in any material respect;

a change in ownership of twenty-five percent ( 25 %) or more of the common stock of the Borrower;

or a material adverse change in the Borrower’s

financial condition.

Upon an Event of Default, the interest rate on the Note shall be 18.00 %.

The Note contains covenants applicable

to the Borrower pertaining to the line of credit, including, among others, that the Borrower agrees to:

maintain books and records of

its operations (the “Books and Records”) to the need for the line of credit;

permit the Lender or any of the Lender’s

representatives, inspect and/or copy the Books and Records;

and to provide the Lender any documentation requested which support the reason

for making any advance under the line of credit.

Further, the Note provides that the Borrower shall furnish from time to time to the Lender,

upon the Lender’s request, copies of balance sheets of the Borrower, and copies of statements of income and cash flows of the Borrower.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Notes Payable (continued)

Acquisition Notes

The following notes were acquired in the acquisition of NAHD.

Note A - Note payable dated June 23,

2022 for $ 250,000 , with interest at 9.5 % per annum and due on September 23, 2022.

The Note is unsecured.

The Note is currently in default.

As of September 30, 2025 the outstanding balance amounted to $ 250,000 .

Note B - Note payable dated June 6,

2022 for $ 350,000 , with interest at 9.5 % per annum and due on September 23, 2022.

The Note is secured.

The Note is currently in default.

As of September 30, 2025 the outstanding balance amounted to $ 274,290 .

Note C - Note payable dated September

14, 2022 for $ 106,400 , with interest at 6.75 % per annum and due on September 23, 2023.

The Note is unsecured.

The Note is currently in

As of September 30, 2025 the outstanding balance amounted to $ 106,400 .

Note D - Note payable dated September

21, 2022 for $ 210,000 , with interest at 9.5 % per annum and due on November 21, 2022.

The Note is unsecured.

The Note is currently in default.

As of September 30, 2025 the outstanding balance amounted to $ 210,000 .

Note E - Note payable dated October

10, 2024 for $ 150,000 , with interest at 15.32 % per annum and due on October 8, 2029.

The Note is unsecured.

As of September 30, 2025 the

outstanding balance amounted to $ 130,469 .

Note F - Note payable dated February 6, 2022 for $ 125,000 , with interest

at 7 % per annum and due on August 6, 2022.

The Note is originally convertible at a price equal to fifty percent ( 50 %) of the 5 day average

closing price for the Common Stock of Olenox from the trading day immediately preceding the conversion.

The Note is in default.

September 30, 2025 the outstanding balance amounted to $ 125,000 .

Note G - Note payable dated October 4, 2022 for $ 65,000 , with interest

at 7 % per annum and due on April 4, 2023.

The Note is originally convertible at a price equal to fifty percent ( 50 %) of the 5 day average

closing price for the Common Stock of Olenox from the trading day immediately preceding the conversion.

The Note is in default.

September 30, 2025 the outstanding balance amounted to $ 65,000 .

Note H - Note payable of $ 500,000 on June 28, 2022, for cash of $ 500,000 ,

with interest at 10 % per annum and due June 28, 2024.

The Note is originally convertible at a conversion price equal to the lesser of

(i) the price paid per share for Equity Securities by the Investors in the Qualified Financing multiplied by 0.80, and (ii) the quotient

resulting from dividing $ 20,000,000.00 by the number of outstanding shares of common stock of Machfu immediately prior to the Qualified

The Note is currently in default.

As of September 30, 2025 the outstanding balance amounted to $ 500,000 .

Note I - Note payable of $ 250,000 on July 12, 2023, for cash of $ 250,000 ,

with interest at 10 % per annum and due July 12, 2025.

The Note is originally convertible at a conversion price equal to the lesser of

(i) the price paid per share for Equity Securities by the Investors in the Qualified Financing multiplied by 0.80, and (ii) the quotient

resulting from dividing $ 20,000,000.00 by the number of outstanding shares of common stock of Machfu immediately prior to the Qualified

As of September 30, 2025 the outstanding balance amounted to $ 250,000 .

Note J - Note payable dated April 30, 2023, for $ 125,000 , with interest

at 7 % per annum and due on April 30, 2024.

The Note is originally convertible at a price equal to fifty percent ( 50 %) of the 5 day average

closing price for the Common Stock of Olenox from the trading day immediately preceding the conversion.

The Note is in default.

This noteholder

is a related party.

As of September 30, 2025 the outstanding balance amounted to $ 12,000 .

Note K - Note payable of $ 98,231 during year-ended December 31, 2024,

for cash of $ 98,231 , with interest at 7 % per annum and due December 31, 2025.

The Note is originally convertible at a price equal to fifty

percent ( 50 %) of the 5 day average closing price for the Common Stock of Olenox from the trading day immediately preceding the conversion.

As of September 30, 2025 the outstanding balance amounted to $ 98,321 .

Note L - Note payable of

$ 1,574,096 dated Feb 23, 2023 with interest at 12 % per annum and due on Aug 23, 2023.

The Company assumed the convertible notes

payable, of which the note holder was the Chief executive officer, on an asset purchase agreement effective on February 23, 2023.

The note is due on demand.

The note is in default.

During the nine months ended September 30, 2025, $ 765,090 of principal balance

and $ 653,972 of accrued interest was converted into 109,313 shares of common stock (post September Stock Split).

The conversions

were within the terms of the underlying agreements and no gain or loss was recorded.

As of September 30, 2025 the outstanding

balance amounted to $ 909,006 .

Note M - Note payable to a related party of $ 33,722 on various

dates and due on demand.

There is no interest on the Note.

As of September 30, 2025 the outstanding balance amounted to $ 0 .

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

Notes Payable (continued)

As of September 30, 2025 and December

31, 2024, long term notes payable consisted of the following:

Authority Loan Agreement

Diagonal January 2025

July Cash Advance Agreement

Pawn Advance Agreement

Enhanced Note

1800 Diagonal Note

December Cash Advance Agreement

December Cash Advance Agreement 2

August 1800 Diagonal Note

Galvin Note Payable

Generating Alpha

debt discount and debt issuance costs

Total debt, net

current maturities, net

( 7,063,111 )

( 2,098,381 )

Long-term debt, net

Scheduled maturities of notes payable is as follows for the

years ending December 31,:

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Net Income (Loss) Per Share

Basic net income (loss) per share is

computed by dividing the net income (loss) for the period by the weighted average number of common shares outstanding during the period.

Diluted net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of common

and potentially dilutive common shares outstanding during the period.

Potentially dilutive common shares consist of the common shares

issuable upon the exercise of stock options and warrants.

Potentially dilutive common shares are excluded from the calculation if their

effect is antidilutive.

At September 30, 2025, there were

options, restricted stock units and warrants of 29, 6,992 and 97,752 , respectively, outstanding that could potentially dilute future net

income per share.

Additionally, there were 9,014 shares of common stock from the conversion of notes payable, an additional 325,625 shares

of common stock to be issued under the Tysado Conversion, 902,025 shares of common stock from the conversion of Series A Preferred Stock

and 4,687,500 shares of common stock from the conversion of Series B Preferred Stock that could potentially dilute net income per share

as of September 30, 2025.

Because the Company had a net loss as of September 30, 2025, it is prohibited from including potential common

shares in the computation of diluted per share amounts.

Accordingly, the Company has used the same number of shares outstanding to calculate

both the basic and diluted loss per share.

At September 30, 2024, there were options, restricted stock units and warrants of 28,

233 and 62,866 , respectively, outstanding that could potentially dilute future net income per share.

Although management believes it has established adequate procedures for estimating costs to complete on open contracts, it is at least reasonably possible that additional significant costs could occur on contracts prior to completion.

The Company periodically evaluates and revises its estimates and makes adjustments when they are considered necessary.

During the three months ended March 31, 2026, the Company recognized $ 4,989 of revenue related to its contract liabilities as of December 31, 2025.

As of March 31, 2025, the Company has contract assets of $ 103,736 and contract liabilities of $ 455,260 .

The Company’s contract liabilities are included within ‘contract liabilities and deferred revenue’ on the condensed consolidated balance sheets.

There have been no material changes to the Company’s outstanding debt or the terms thereof from those disclosed in Note 8 to the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, except as described below.

Cedar Advance LLC (“Cedar”)

In February 2026, the Company issued 50,000 shares of common stock in settlement of merchant cash advance obligations due to Cedar Advance LLC with an aggregate outstanding balance of $ 1,727,449 .

The shares issued were valued at $ 530,000 , and the Company recognized a gain on debt extinguishment of $ 1,197,449 .

Acquisition Note Settlement

In February 2026, the Company issued 34,948 shares of common stock in settlement of a note payable and accrued interest, with an aggregate outstanding balance of $ 10,883 .

The shares issued had a fair value of $ 346,055 based on the closing price of the Company’s stock on the settlement date, and the Company recognized a loss on debt extinguishment of $ 335,172 .

Due to Affiliates Settlement

In February 2026, the Company issued 62,333 shares of common stock in settlement of amounts due to affiliated entity controlled by the Company’s Chief Executive Officer, a related party, including accrued interest, with an aggregate outstanding balance of $ 338,662 .

The shares issued had a fair value of $ 617,213 , based on the closing price of the Company’s stock on the settlement date and the Company recognized a loss on debt extinguishment of $ 278,551 (see Note 12).

CONSTRUCTION BACKLOG

The following represents the backlog

of signed construction and engineering contracts in existence at September 30, 2025 and December 31, 2024, which represents the amount

of revenue the Company expects to realize from work to be performed on uncompleted contracts in progress and from contractual agreements

in effect at September 30, 2025 and December 31, 2024, respectively, on which work has not yet begun:

The following represents the backlog of signed construction and engineering contracts in existence at March 31, 2026 and December 31, 2025, which represents the amount of revenue the Company expects to realize from work to be performed on uncompleted contracts in progress and from contractual agreements in effect at such dates on which work has not yet begun:

Balance - beginning of period $ 271,128 $ 1,182,955

New contracts and change orders during the period 1,109,456 1,199,839

Adjustments and cancellations, net

Subtotal 1,380,584 2,382,794

contract revenue earned during the period ( 100,740 ) ( 2,111,666 )

( 1,840,518 )

( 4,976,618 )

Balance - end of period $ 1,279,844 $ 271,128

The Company’s remaining backlog

as of September 30, 2025 represents the remaining transaction price of firm contracts for which work has not been

performed and excludes unexercised contract options.

The Company expects to satisfy its backlog

which represents the remaining unsatisfied performance obligation on contracts as of September 30, 2025 over the following period:

Within 1 year

Total Backlog

Although backlog reflects business that

is considered to be firm, cancellations, deferrals or scope adjustments may occur.

Backlog is adjusted to reflect any known project cancellations,

revisions to project scope and cost and project deferrals, as appropriate.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Stockholders’ Equity

Issuance of common stock for debt

issuance – During the nine months ended September 30, 2025, the Company issued 294,000 shares of common stock ( 4,594 as

adjusted for the September Stock Split), and warrants for issuances of debt.

The value of the shares amounted to $ 332,049 , which was recorded

as a debt discount.

Restricted Stock Units –

During the nine months ended September 30, 2025, the Company issued 68,229 shares of common stock ( 1,066 as adjusted for the September

Stock Split) with a value of $ 318,894 for vested restricted stock units.

Forgiveness of related party debt – As

disclosed in Note 2, the Company entered into the Mutual Release with SG DevCorp.

As a result of the Mutual Release the Company recorded

$ 1,275,416 in additional paid in capital which resulted from the forgiveness of its debt along with the transfer of SG DevCorp shares.

Additionally, during the nine months ended September 30, 2025, the Company issued 1,216,000 shares of common stock ( 19,000 as adjusted

for the September Stock Split) for the forgiveness of accrued interest on a note payable from the Company’s chief executive officer.

The total amount amounted to $ 494,912 which has been recorded to additional paid in capital.

Additionally, during the nine months ended

September 30, 2025, the Company issued 90,313 shares of common stock for the forgiveness of the principal amount on outstanding notes

The total amounted to $ 778,938 .

Issuance of common stock for preferred

– During the nine months ended September 30, 2025, the Company issued

2,000,000 shares of common stock ( 31,250 as adjusted for the September Stock Split) for the relinquishment of 151,360 preferred shares,

which were issued in connection with the Merger of NAHD.

Such shares were issued to former stockholders of NAHD.

The transaction was accounted

for as an equity-to-equity exchange with a reduction to the preferred stock par value and a corresponding increase to common stock and

additional paid-in capital.

Issuance of common stock for

services – On July 1, 2025, the Company issued 4,017 restricted shares of common stock (post September Stock Split) of

the Company for services provided, with a total value of $ 14,803 .

Pre-funded warrant exercises –

Commencing on July 31, 2025, and ending on August 8, 2025, the Company received exercises notices for a total of 279,752 pre-funded warrants

and were correspondingly issued 279,752 shares of common stock (post September Stock Split) of the Company.

Conversions – During

the nine months ended the Company issued 199,963 (post September Stock Split from the conversion of $ 696,250 in outstanding notes payable.

The excess value of common stock resulted in a loss of $ 4,915,209 being recognized.

Common stock to be issued

– In connection with the Tysadco Conversion, the Company recorded common stock to be issued in the amount of $ 3,381,436 for the

value of the remaining shares to be issued.

Inducement - On March

8, 2024, the Company entered into a warrant inducement agreement (the “Inducement Agreement”) with a certain holder (the

“Holder”) of warrants to purchase shares of the Company’s common stock, par value $ 0.01 per share (the “Common

Stock”), issued in a private placement offering that closed on October 27, 2021 (the “Existing Warrants”).

to the Inducement Agreement, the Holder of the Existing Warrants agreed to exercise for cash the Existing Warrants to purchase up to

1,898,630 shares of common stock ( 94,932 as adjusted for the May Stock Split and 1,483 as further adjusted for the September Stock Split),

at an exercise price of $ 0.2603 per share ($ 5.206 as adjusted for the May Stock Split and $ 333.18 as further adjusted for the September

Stock Split).

The Company recognized common stock deemed dividends in the amount of $ 670,881 which resulted from the excess initial fair

value of the New Warrants Shares issued described below.

In addition, the Company incurred $ 454,867 of equity related costs which have

been netted with the net proceeds from the July 2022 Offering.

The Company received aggregate gross proceeds of approximately $ 494,213 ,

before deducting placement agent fees and other expenses payable by the Company.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Stockholders’ Equity (continued)

In consideration of the Holder’s

immediate exercise of the Existing Warrants, the Company issued unregistered warrants (the “New Warrants”) to purchase 3,797,260

shares of Common Stock ( 189,863 as adjusted for the May Stock Split and 2,967 as further adjusted for the September Stock Split) ( 200 %

of the number of shares of common stock issued upon exercise of the Existing Warrants) (the “New Warrant Shares”) to the Holder.

The issuance of the shares of Common

Stock underlying the Existing Warrants have been registered pursuant to an existing registration statement on Form S-1 (File No.

which was declared effective by the Securities and Exchange Commission (the “SEC”) on November 23, 2021.

In addition, pursuant to the Inducement

Agreement, the Company agreed not to issue any shares of Common Stock or Common Stock equivalents (as defined in the Inducement Agreement)

or to file any other registration statement with the SEC (in each case, subject to certain exceptions) until thirty ( 30 ) days after the

The Company has also agreed not to effect or agree to effect any Variable Rate Transaction (as defined in the Inducement Agreement)

until sixty ( 60 ) days after closing.

The Company agreed in the Inducement

Agreement to file a registration statement to register the resale of the New Warrant Shares (the “Resale Registration Statement”)

on or before thirty ( 30 ) days from the initial closing of the transactions contemplated by the Inducement Agreement, and to use commercially

reasonable efforts to have such Resale Registration Statement declared effective by the SEC within sixty ( 60 ) days (or, in the event of

a full review, ninety ( 90 ) calendar days) following the date of filing the Resale Registration Statement.

Under the Inducement Agreement, to the

extent required under the rules and regulations of the Nasdaq Stock Market, the Company agreed to hold a special or annual meeting of

shareholders no later than the 60th calendar date following the date of the Inducement Agreement for the purpose of seeking the Stockholder

Approval (as defined below).

If the Company does not obtain Stockholder Approval at the first meeting, the Company shall call a meeting

every ninety ( 90 ) days thereafter to seek Stockholder Approval until the earlier of the date Stockholder Approval is obtained or the New

Warrants are no longer outstanding.

The Company expects to use the net proceeds

from these transactions for working capital and other general corporate purposes.

Maxim served as the Company’s

financial advisor in connection with the transactions described in the Inducement Agreement, and the Company paid Maxim (i) a cash fee

equal to 7.0 % of the aggregate gross proceeds received from the Holder upon exercise of the Existing Warrants and the exercise of the

New Warrants, and (ii) $ 10,000 for legal fees and other out-of-pocket expenses.

May 2024 Private Placement

- On May 3, 2024, the Company entered into a Securities Purchase Agreement (the “May Securities Purchase Agreement”) for a

private placement (the “Private Placement”) with a single accredited institutional investor (the “Purchaser”).

Pursuant to the Securities Purchase Agreement, the Purchaser agreed to purchase 130,000 shares (the “Shares”) of the Company’s

common stock ( 2,031 as adjusted for the September Stock Split), par value $ 0.01 per share (the “Common Stock”), and pre-funded

warrants to purchase 1,249,310 shares of Common Stock ( 19,520 as adjusted for the September Stock Split) in lieu thereof (the “Pre-Funded

Warrants”) and common warrants (the “Common Warrants”) to purchase up to 2,758,620 shares of Common Stock ( 43,103 as

adjusted for the September Stock Split).

Pursuant to the May Securities Purchase Agreement, the combined offering price of each Share

and Common Warrant was set at $ 2.90 ($ 185.60 as adjusted for the September Stock Split) and the combined offering price of each Pre-Funded

Warrant and Common Warrant was set at $ 2.8999 ($ 185.59 as adjusted for the September Stock Split).

The Shares, the Pre-Funded Warrants,

the Common Warrants and the shares of Common Stock issuable upon exercise of the Pre-Funded Warrants and Common Warrants are collectively

referred to herein as the “Securities.”

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Stockholders’ Equity (continued)

The Pre-Funded Warrants are exercisable

immediately following the date of issuance, may be exercised at any time until all of the Pre-Funded Warrants are exercised in full, and

have an exercise price of $ 0.0001 per share.

The Common Warrants are exercisable immediately following the date of issuance, have a term

of five years from the effective date of the Registration Statement (as defined below) registering the Shares and the shares of Common

Stock issuable upon exercise of the Pre-Funded Warrants and the Common Warrants and have an exercise price of $ 2.65 per share ($ 169.60

as adjusted for the September Stock Split).

A holder may not exercise any Pre-Funded Warrants that would cause the aggregate number of

shares of common stock beneficially owned by the holder to exceed 9.99 % of the Company’s outstanding Common Stock immediately after

A holder may not exercise any Common Warrants that would cause the aggregate number of shares of common stock beneficially owned

by the holder to exceed 4.99 % of the Company’s outstanding Common Stock immediately after exercise.

The Pre-Funded Warrants and

the Common Warrants are subject to adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations,

reclassifications or similar events affecting the Common Stock and also upon any distributions for no consideration of assets to the Company’s

stockholders.

In the event of certain corporate transactions, the holders of the Pre-Funded Warrants and the Common Warrants will be entitled

to receive, upon exercise of the Pre-Funded Warrants and the Common Warrants, respectively, the kind and amount of securities, cash or

other property that the holders would have received had they exercised the Pre-Funded Warrants and the Common Warrants immediately prior

to such transaction.

The Pre-Funded Warrants and the Common Warrants do not entitle the holders thereof to any voting rights or any of

the other rights or privileges to which holders of common stock are entitled.

In the event of a “Fundamental

Transaction,” which term is defined in the Pre-Funded Warrants and the Common Warrants and generally includes (i) the Company, directly

or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person (as

defined in the Pre-Funded Warrants and Common Warrants) in which the Company is not the surviving entity (other than a reincorporation

in a different state, a transaction for changing the Company’s name, or a similar transaction pursuant to which the surviving company

remains a public company), (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance

or other disposition of all or substantially all of the Company’s assets in one or a series of related transactions (which, for

the avoidance of doubt, shall not include such transactions that do not require approval of the Company’s stockholders), (iii) any,

direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to

which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been

accepted by the holders of more than 50 % of the voting power of the common equity of the Company, (iv) the Company, directly or indirectly,

in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory

share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property other

than a stock split, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase

agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme

of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50 % of the voting power

of the common equity of the Company, the holders of the Pre-Funded Warrants and Common Warrants will be entitled to receive upon exercise

of the Pre-Funded Warrants and the Common Warrants the kind and amount of securities, cash or other property that the holders would have

received had they exercised such warrants immediately prior to such Fundamental Transaction.

Additionally, as more fully described in

the Common Warrants, in the event of certain Fundamental Transactions, the holders of the Common Warrants will be entitled to receive

consideration in an amount equal to the Black Scholes Value (as defined in the Common Warrants) of the remaining unexercised portion of

the Common Warrants on the date of consummation of such Fundamental Transaction.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Stockholders’ Equity (continued)

The Private Placement closed on May

The Company received net proceeds from the Private Placement of $ 3,590,386 .

Additionally, during the year ended December

31, 2024, 294,310 prefunded warrants ( 4,599 as adjusted for the September Stock Split) were exercised.

April Private Placement

- On April 14, 2025, the Company consummated a private placement (the “April Private Placement”) pursuant to a securities

purchase agreement (the “April Purchase Agreement”) with institutional investors (the “Purchasers”) for the purchase

and sale of approximately $ 8 million of shares of the Company’s common stock (the “Common Stock”) and investor warrants

at a price of $ 0.392 per Common Unit ($ 25.09 as adjusted for the September Stock Split).

The Company issued 2,504,000 shares of common

stock ( 39,126 as adjusted for the September Stock Split) in this transaction.

The entire transaction was priced at the market under Nasdaq

The offering consisted of the sale of Common Units (or Pre-Funded Units), each consisting of (i) one (1) share of Common Stock

or one (1) Pre-Funded Warrant (“April Pre-Funded Warrants”), (ii) one (1) Series A PIPE Common Warrant to purchase one (1)

share of Common Stock per warrant at an exercise price of $ 0.784 (the “Series A Warrant”) ($ 40.18 as adjusted for the September

Stock Split) and (iii) one (1) Series B PIPE Common Warrant to purchase one (1) share of Common Stock per warrant at an exercise price

of $ 0.98 ($ 62.72 as adjusted for the September Stock Split) (the “Series B Warrant” and together with the Series A Warrant,

the “Warrants”).

The initial exercise price of each Series

A Warrant is $ 0.784 per share of Common Stock ($ 50.18 as adjusted for the September Stock Split).

The Series A Warrants are exercisable

following stockholder approval and expire five (5) years thereafter.

The number of securities issuable under the Series A Warrant is subject

to adjustment as described in more detail in the Series A Warrant.

The initial exercise price of each Series B Warrant is $ 0.98 per share

of Common Stock ($ 62.72 as adjusted for the September Stock Split) or pursuant to an alternative cashless exercise option.

B Warrants are exercisable following stockholder approval and expire two and one-half ( 2.5 ) years thereafter.

The number of securities

issuable under the Series B Warrant is subject to adjustment as described in the Series B Warrant.

Each Pre-Funded Warrant is exercisable

for one share of Common Stock for $ 0.0001 immediately upon issuance until all of the Pre-Funded Warrants are exercised in full.

of Pre-Funded Warrant Shares are subject to adjustments for stock splits, recapitalizations, and reorganizations.

The shares of Common

Stock, shares underlying the Series A Warrants and shares underlying the Series B Warrants are collectively referred to as the “Securities”.

In connection with the April Private

Placement, the Company entered into a registration rights agreement with the Purchasers on April 14, 2025 (the “Registration Rights

Agreement”), pursuant to which the Company is required to file a registration statement covering the resale of the Securities by

April 30, 2025.

Pursuant to the terms of the letter

of engagement with D.

Boral Capital LLC (the “Placement Agent”), the Company paid the Placement Agent a placement agent commission

equal to 6.0 % of the aggregate gross proceeds from the offering, and an additional 1.0 % for non-accountable expenses.

In addition, the

Company agreed to reimburse the placement agent for certain of out-of-pocket expenses, including for reasonable legal fees and disbursements

for its counsel.

Additionally, pursuant to the Company’s letter of engagement with Aegis Capital Corp.

(“Aegis”), the

Company has agreed to pay Aegis a commission equal to 5.0 % of the aggregate gross proceeds from the offering.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Stockholders’ Equity (continued)

The Purchase Agreement contains customary

representations and warranties, indemnification rights, agreements and obligations, conditions to closing and termination provisions.

The offering closed on April 14, 2025.

The net proceeds to the Company from the Offering were $ 6,635,294 , after deducting placement agent

fees and the payment of other offering expenses associated with the offering that were payable by the Company.

On July 17, 2025, the Company entered into an

Exchange Agreement (the “ Exchange Agreement ”) by and among the Company and the Purchasers.

Pursuant to the Exchange

Agreement, the parties intended to effect a voluntary security exchange transaction (the “Exchange Transaction ”) whereby

the Purchasers will exchange the Series A and Series B Warrants previously purchased in the April Private Placement for an aggregate of

60,000 shares of Series B Preferred Stock (the “ Exchange Shares ”), with the New Series B Convertible Preferred Stock’s

rights and preferences being set forth on that certain certificate of designation (the “ Certificate of Designation ”)

of the Company, filed with the State of Delaware on July 17, 2025.

The Exchange Agreement contains other customary provisions including

representations and warranties for the Company and the Purchasers, governing law, and notice.

May ELOC - On May 29,

2025 the Company entered into a Stock Purchase Agreement (the “ELOC Purchase Agreement”) with Generating Alpha Ltd., a Saint

Kitts and Nevis Company (the “Purchaser”), whereby the Company shall issue and sell to the Purchaser, subject to the terms

and conditions of the ELOC Purchase Agreement, up to an aggregate of $ 100 million (the “Commitment Amount”) of newly issued

shares (the “ELOC Shares”) of the Company’s common stock, par value $ 0.01 per share (the “Common Stock”).

The Company does not have a right to

commence any sales of Common Stock to the ELOC Purchaser under the ELOC Purchase Agreement until the time when all of the conditions to

the Company’s right to commence sales of Common Stock to the ELOC Purchaser set forth in the ELOC Purchase Agreement have been satisfied,

including that a registration statement of such shares is declared effective by the SEC and the final form of prospectus is filed with

the SEC (the “Commencement Date”).

Over the period ending on the earlier of May 8, 2026, or the date on which the Purchaser

shall have purchased ELOC Shares pursuant to the ELOC Purchase Agreement for an aggregate purchase price of the Commitment Amount, the

Company will control the timing and amount of any sales of ELOC Shares to the ELOC Purchaser.

Actual sales of shares of Common Stock to

the ELOC Purchaser under the ELOC Purchaser Agreement will depend on a variety of factors to be determined by the Company from time to

time, including, among others, market conditions, the trading price of the Common Stock and determinations made by the Company as to appropriate

sources of funding.

The purchase price of the shares of

ELOC Shares that the Company elects to sell to the ELOC Purchaser pursuant to the ELOC Purchase Agreement will be equal to the lowest

traded price of Common Stock during the seven (7) trading days prior to the applicable closing date multiplied by 90 %.

As of September

30, 2025, no shares have been purchased under the ELOC Purchase Agreement.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Preferred Shares

As of September 30, 2025, the Company

had 60,000 shares of Series B Preferred Stock issued and outstanding.

The rights and privileges of the Series A Preferred Stock are as

- Dividends - Holders shall be entitled to receive, and the Company shall pay, dividends on shares of Preferred

Stock equal (on an as-if-converted-to-Common-Stock basis, disregarding for such purpose any conversion limitations hereunder) to and in

the same form as dividends actually paid on shares of the Common Stock when, as and if such dividends are paid on shares of the Common

No other dividends shall be paid on shares of Preferred Stock.

The Company shall not pay any dividends on the Common Stock unless

the Corporation simultaneously complies with this provision.

- Voting Rights.

Except as otherwise provided herein or as otherwise required by law, the issuance of preferred

stock has limited voting power, such that the preferred stock would vote as if converted at the “Nasdaq Minimum Price” as

defined in Listing Rule 5635(d)(1), on the date of issuance.

Notwithstanding the foregoing, the holders of the Series B Preferred Stock

shall not be permitted to vote in excess of 19.99 % until shareholder approval for the Series B Preferred Stock is obtained.

Additionally,

as long as any shares of Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of the Holders of at

least 67 % of the then-outstanding shares of the Preferred Stock, (a) alter or change adversely the powers, preferences or rights given

to the Preferred Stock or alter or amend this Certificate of Designation, (b) authorize or create any class of stock ranking as to dividends,

redemption or distribution of assets upon a Liquidation (as defined in Section 5) senior to, or otherwise pari passu with, the Preferred

Stock, (c) amend its certificate of incorporation or other charter documents in any manner that adversely affects any rights of the Holders,

(d) increase the number of authorized shares of Preferred Stock, or (e) enter into any agreement with respect to any of the foregoing.

- Liquidation.

Upon any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary

(a “Liquidation”), prior and in preference to the Junior Stock, the Holders shall be entitled to receive out of the assets,

whether capital or surplus, of the Corporation an amount in cash equal to the Stated Value, plus any accrued and unpaid dividends thereon

and any other fees or liquidated damages then due and owing thereon under this Certificate of Designation, for each share of Preferred

Stock, and if the assets of the Company shall be insufficient to pay in full such amounts, then the entire assets to be distributed to

the Holders shall be ratably distributed among the Holders in accordance with the respective amounts that would be payable on such shares

if all amounts payable thereon were paid in full.

The preference set forth in this Section 5 shall apply mutatis mutandis to any

distributions to be made upon the consummation of a Fundamental Transaction.

The Company shall mail written notice of any such Liquidation,

not less than 45 days prior to the payment date stated therein, to each Holder.

- Conversion.

- a) Conversions at Option

Each share of Preferred Stock shall be convertible, at any time and from time to time from and after the Original Issue Date

at the option of the Holder thereof, into that number of shares of Common Stock (subject to the limitations set forth in Section 6(d)

and Section 6(e)) determined by dividing the Stated Value of such share of Preferred Stock by the Conversion Price.

Holders shall effect

conversions by providing the Company with the form of conversion notice attached hereto as Annex A (a “Notice of Conversion”).

Each Notice of Conversion shall specify the number of shares of Preferred Stock to be converted, the number of shares of Preferred Stock

owned prior to the conversion at issue, the number of shares of Preferred Stock owned subsequent to the conversion at issue and the date

on which such conversion is to be effected, which date may not be prior to the date the applicable Holder delivers by .pdf via email such

Notice of Conversion to the Company (such date, the “Conversion Date”).

If no Conversion Date is specified in a Notice of

Conversion, the Conversion Date shall be the date that such Notice of Conversion to the Company is deemed delivered hereunder.

No ink-original

Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of

Conversion form be required.

The calculations and entries set forth in the Notice of Conversion shall control in the absence of manifest

or mathematical error.

To effect conversions of shares of Preferred Stock, a Holder shall not be required to surrender the certificate(s)

representing the shares of Preferred Stock to the Company unless all of the shares of Preferred Stock represented thereby are so converted,

in which case such Holder shall deliver the certificate representing such shares of Preferred Stock promptly following the Conversion

Date at issue.

Shares of Preferred Stock converted into Common Stock or redeemed in accordance with the terms hereof shall be canceled

and shall not be reissued.

b) Conversion Price.

The conversion price for the Preferred Stock shall equal the lesser of (i) $ 0.392 ($ 25.09

as adjusted for the September Stock Split), subject to adjustment herein (the “Set Price”) and (ii) the greater of (A) 90 %

of the lowest daily VWAP of the Common Stock during the ten (10) consecutive Trading Day period ending and including the Trading Day immediately

preceding the delivery or deemed delivery of the applicable Notice of Conversion and (B) $ 0.20 ($ 12.80 as adjusted for the September Stock

Split) subject to adjustment herein (the lower of (i) and (ii), the “Conversion Price”).

As of September 30, 2025, the Company

had 3,848,640 shares of Series A Preferred Stock issued and outstanding.

The rights and privileges of the Series A Preferred Stock are

the same as the Series B Preferred Stock as stated above, with the exception that the Series A Holders shall have no voting rights, and

each share of Preferred Stock has the right to convert into shares of common stock of the Company at a ratio of 1 for 0.234375, meaning

each 64 Preferred Shares will convert into 15 shares of common stock of the Company.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Segments and Disaggregated Revenue

The Company’s Chief Operating

Decision Maker (“CODM”) as defined under GAAP, who is the Company’s Chief Financial Officer and Chief Executive Officer ,

has determined that the Company is currently organized its operations into the segments as follows.

We have organized our operations into three segments:

Construction, Medical, Development and Environmental.

We allocate to segment results the operating expenses “Payroll and related

expenses,” “General and administrative, ” “Marketing and business development,” and “Pre-project”

based on usage, which is generally reflected in the segment in which the costs are incurred.

These segments reflect the way our executive

team evaluates the Company’s business performance and manages its operations.

The Construction segment includes the Company’s

manufacturing unit SG ECHO and other modules projects.

The Medical segment mainly consists of minimal expenses for this segment.

The Environmental

segment has had no activity through December 31, 2024.

Corporate and support consists of general corporate expenses such

as our executive office;

the corporate finance, accounting, audit, tax, human resources, risk management, information technology, marketing,

and legal groups;

The Company’s remaining backlog as of March 31, 2026 represents the remaining transaction price of firm contracts for which work has not been performed and excludes unexercised contract options.

The Company expects to satisfy its backlog, which represents the remaining unsatisfied performance obligation on contracts as of March 31, 2026, within one year.

The Company has elected the practical expedient that allows it to omit disclosure of remaining performance obligations for contracts with an original expected duration of one year or less.

Although backlog reflects business that is considered to be firm, cancellations, deferrals or scope adjustments may occur.

Backlog is adjusted to reflect any known project cancellations, revisions to project scope and cost and project deferrals, as appropriate.

SEGMENT REPORTING

The Company’s Chief Operating Decision Maker (CODM) as defined under GAAP, who is the Company’s Chief Financial Officer and Chief Executive Officer , has determined that the Company’s operations are currently organized into three segments:

Construction, Software-as-a-Service (“SaaS”) and Oil and Gas.

The Company allocates to segment results the operating expenses payroll and related expenses, general and administrative , marketing and business development, and pre-project costs based on usage, which is generally reflected in the segment in which the costs are incurred.

These segments reflect the way our CODM evaluates the Company’s business performance and manages its operations.

The Construction segment includes the Company’s manufacturing unit and other modular projects.

The SaaS segment consists primarily of Machfu and its related industrial IoT products and services.

The oil and gas segment reflects the operations of Olenox Corp.

Corporate consists of general corporate expenses such as our executive office;

the corporate finance, accounting, tax, human resources, risk management, information technology, marketing, and legal groups;

corporate overhead and other items not allocated to any of the Company’s segments.

From time to time, the

Company revises the measurement of each segment’s cost of revenue and operating expenses, including any corporate overhead allocations,

as determined by the information regularly reviewed by its executive team.

The CODM continually reviews a monthly statement of operations

separated by segment, along with an analysis of the significant segment expenses as described below.

Information for the Company’s

segments, as well as for Corporate and support, is provided in the following table:

Corporate and support

Three Months Ended September 30, 2025

From time to time, the Company revises the measurement of each segment’s cost of revenue and operating expenses, including any corporate overhead allocations, as determined by the information regularly reviewed by the CODM.

The CODM continually reviews a monthly statement of operations separated by segment, along with an analysis of the significant segment expenses as described below.

Information for the Company’s segments, as well as for Corporate and support, is provided in the following table:

Construction SaaS Oil and Gas Corporate Consolidated

Three Months Ended March 31, 2026

Revenue $ 100,471 $ 25,548 $ 159,293 $ — $ 285,313

Significant segment expenses:

Costs of revenue:

Allocated overhead

Other costs of revenue

Operating expenses:

Payroll and related

Professional fees

Other expenses

Operating loss

( 1,560,959 )

( 2,507,726 )

Other income (expense)

( 3,009,884 )

( 2,808,146 )

$ ( 4,570,843 )

$ ( 758,652 )

$ ( 5,315,872 )

Depreciation and amortization

Corporate and support

Three Months Ended September 30, 2024

Significant segment expenses:

Cost of revenue

Direct labor 6,746 — — 1,031 7,777

Materials 78,655 — — — 78,655

Allocated overhead 5,988 — — — 5,988

Other costs of revenue 43,998 10,158 — 99,744 153,900

Lease and well operating costs — — 239,826 — 239,826

Total costs of revenue 135,387 10,158 239,826 100,775 486,146

Operating expenses:

1 unchanged sentence

Professional fees — — — 516,098 516,098

Other expenses

General and administrative 115,519 196,686 — 1,161,598 1,473,803

Total operating expenses 190,372 217,295 — 2,274,614 2,682,281

Operating income (loss) ( 225,288 ) ( 201,905 ) ( 80,533 ) ( 2,375,388 ) ( 2,883,114 )

( 2,083,655 )

( 2,241,085 )

Other expense

$ ( 234,831 )

$ ( 3,471,262 )

$ ( 3,716,105

Other expense (income) 149,884 30,461 — ( 397,735 ) ( 217,390 )

Loss before income taxes ( 375,172 ) ( 232,366 ) ( 80,533 ) ( 1,977,653 ) ( 2,665,724 )

Provision for income taxes — — — — —

Net loss $ ( 375,172 ) $ ( 232,366 ) $ ( 80,533 ) $ ( 1,977,653 ) $ ( 2,665,724 )

Total assets $ 9,061,447 $ 19,077,273 $ 3,923,164 $ 3,338,892 $ 35,400,776

Depreciation and amortization $ 42,621 $ 121,846 $ 81,425 $ 80,392 $ 326,284

Capital expenditures $ 46,643 $ — $ — $ — $ 31,643

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Segments and Disaggregated Revenue (continued)

Nine Months Ended September 30, 2025

Construction Medical Corporate

and support Oil and Gas Consolidated

Three Months Ended March 31, 2025

Revenue $ 496,079 $ — $ — $ 70,275 $ 566,354

Significant segment expenses:

Costs of revenue:

Direct labor 188,093 — — — 188,093

Materials 144,874 — — — 144,874

Allocated overhead 480,348 — — — 480,348

Other costs of revenue 41,151 — — 35,643 76,794

Total costs of revenue 854,466 — — 35,643 890,109

Operating expenses:

2 unchanged sentences

Other expenses 1,066 827 140,285 207,669 349,847

Total operating expenses 1,066 827 1,182,796 323,538 1,508,227

Operating loss ( 359,453 ) ( 827 ) ( 1,182,796 ) ( 288,906 ) ( 1,831,982 )

Other income (expense)

Depreciation and amortization

Capital expenditure

Nine Months Ended September 30, 2024

Significant segment expenses:

Costs of revenue:

Allocated overhead

Other costs of revenue

Operating expenses:

Payroll and related

Professional fees

Other expenses

Operating income (loss)

( 5,126,860 )

( 5,021,927 )

Other expense ( 150,375 ) — ( 712,557 ) ( 51,754 ) ( 914,686 )

( 7,843,826 )

Income (loss) before income taxes

( 12,970,686 )

( 13,141,074 )

Common stock deemed dividend

( 1,638,149 )

Income from discontinued operations

Net income (loss) attributable to common stockholders

$ ( 11,924,157 )

$ ( 12,094,545 )

Net loss $ ( 509,828 ) $ ( 827 ) $ ( 1,895,353 ) $ ( 340,660 ) $ ( 2,746,668 )

Total assets, as restated (Note 3) $ 4,701,547 $ 1,406 $ 456,097 $ 28,236,577 $ 33,395,626

Depreciation and amortization $ 45,584 $ — $ 15,678 $ 45,913 $ 107,175

Capital expenditure

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

In conjunction with the June 2017 Public

Offering, the Company issued to certain affiliates of the underwriters, as compensation, warrants to purchase an aggregate of 4,313 shares

of common stock ( 216 shares as adjusted for the May Stock Split and 3 shares as further adjusted for the September Stock Split),

at an exercise price of $ 125.00 per share ($ 2,500 as adjusted for the May Stock Split and $ 160,000 as further adjusted for the September

Stock Split).

The warrants are exercisable at the option of the holder on or after June 21, 2018 and expire June 21, 2023 .The fair

value of warrants was calculated utilizing a Black-Scholes model and amounted to $ 63,796 .

The fair market value of the warrants as of

the date of issuance has been included in issuance costs in additional paid-in capital.

In conjunction with the Purchase Agreement

in April 2019, the Company also sold warrants to purchase up to an aggregate of 42,388 shares of common stock ( 2,119 shares

as adjusted for the May Stock Split and 33 shares as further adjusted for the September Stock Split), at an initial exercise price of

$ 27.50 per share ($ 550.00 as adjusted for the May Stock Split and $ 35,200 shares as further adjusted for the September Stock Split).

The warrants are exercisable at the option of the holder on or after October 29, 2019 and expire October 29, 2024 .

issued to certain affiliates of the underwriters, as compensation, warrants to purchase an aggregate of 4,239 shares of common stock ( 212

shares as adjusted for the May Stock Split and 3 shares as further adjusted for the September Stock Split), at an initial exercise price

of $ 27.50 per share ($ 550.00 as adjusted for the May Stock Split and $ 35,200 shares as further adjusted for the September Stock Split),

The warrants are exercisable at the option of the holder on or after October 29, 2019 and expire April 24, 2024 .

In conjunction with the Underwriting

Agreement in August 2019, the Company issued to the underwriter, as compensation, warrants to purchase an aggregate of 2,250 shares

of common stock ( 112 shares as adjusted for the May Stock Split and 2 shares as further adjusted for the September Stock Split),

at an initial exercise price of $ 21.25 per share ($ 425.00 as adjusted for the May Stock Split and $ 27,200 shares as further adjusted

for the September Stock Split), The warrants are exercisable at the option of the holder on or after February 1, 2020 and expire August

In conjunction with the Underwriting

Agreement in May 2020, the Company issued to the underwriter, as compensation, warrants to purchase an aggregate of 300,000 shares

of common stock ( 15,000 shares as adjusted for the May Stock Split and 234 shares as further adjusted for the September Stock Split),

at an initial exercise price of $ 3.14 per share ($ 62.80 as adjusted for the May Stock Split and $ 4,019.20 shares as further adjusted

for the September Stock Split), The warrants are exercisable at the option of the holder on or after November 6, 2020 and expire

May 5, 2025 .

During the year ended December 31, 2021, 226,300 ( 11,315 shares as adjusted for the May Stock Split and 177 shares as

further adjusted for the September Stock Split), warrants were exercised and converted into common stock of the Company.

has received proceeds of approximately $ 707,000 from the exercise of the warrants.

In conjunction with the Purchase

Agreement in October 2021, the Company also issued Series A warrants to purchase up to 1,898,630 shares of Common Stock ( 94,932

shares as adjusted for the May Stock Split and 1,483 shares as further adjusted for the September Stock Split), in a concurrent private

The warrants have an exercise price of $ 4.80 per share, ($ 96.00 as adjusted for the May Stock Split and

$ 6,144 shares as further adjusted for the September Stock Split), exercisable at the option of the holder on or after October 26,

2021 and will expire five years from the date of issuance.

These warrants were exercised in connection with the Inducement

Agreement during the three months ended March 31, 2024.

In conjunction with the issuance

of the Debenture in February 2023, the Company issued the Peak Warrant to purchase 500,000 shares of the Company’s common

stock ( 25,000 shares as adjusted for the May Stock Split and 391 shares as further adjusted for the September Stock Split).

Peak Warrant expires five years from its date of issuance.

The Peak Warrant is exercisable, at the option of the holder, at any

time, for up to 500,000 of shares of common stock ( 25,000 shares as adjusted for the May Stock Split and 391 shares as further

adjusted for the September Stock Split), of the Company at an exercise price equal to $ 2.25 (the “Exercise

Price”) ($ 45.00 as adjusted for the May Stock Split and $ 2,880 shares as further adjusted for the September Stock Split),

subject to adjustment for any stock splits, stock dividends, recapitalizations and similar events and in the event the Company, at

any time while the Peak Warrant is outstanding, issues, sells or grants any option to purchase, or sells or grants any right to

reprice, or otherwise disposes of, or issues common stock or other securities convertible into, exercisable for, or otherwise

entitle any person the right to acquire, shares of common stock, other than with respect to an Exempt Issuance (as defined in

the Debenture), at an effective price per share that is lower than the then Exercise Price.

In the event of any such anti-dilutive

event, the Exercise Price will be reduced at the option of the holder to such lower effective price of the dilutive event, subject

to a floor price of $ 0.40 per share ($ 8.00 as adjusted for the May Stock Split and $ 512 shares as further adjusted for the

September Stock Split) unless and until the Company obtains shareholder approval for any issuance below such floor price.

initial fair value of the Peak Warrant amounted to $ 278,239 and was recorded, in combination with common stock issued above, as a

debt discount of $ 354,329 at the time of issuance of the Debenture.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Warrants (continued)

In connection with the issuance of the

Holdings Debenture in January 2024, the Company issued the “Peak Warrant” #3 to purchase up to 375,000 shares of the

Company’s common stock ( 18,750 as adjusted for the May Stock Split and 293 shares as further adjusted for the September Stock Split)

to Peak One’s designee, as described in the January 2024 Purchase Agreement.

The PeakWarrant #3 expires five years from

its date of issuance.

The Peak Warrant #3 is exercisable, at the option of the holder, at any time, for up to 375,000 of shares of common

stock ( 18,750 as adjusted for the May Stock Split and 293 shares as further adjusted for the September Stock Split) of the Company at

an exercise price equal to $ 0.53 (the “Exercise Price”) ($ 10.60 as adjusted for the May Stock Split and $ 678.40 shares as

further adjusted for the September Stock Split), subject to adjustment for any stock splits, stock dividends, recapitalizations and similar

events, as well as anti-dilution price protection provisions that are subject to a floor price as set forth in the Peak Warrant #3.

Peak Warrant #3 provides for cashless exercise under certain circumstances.

The initial fair value of the Peak Warrant #3 amounted to

$ 109,161 and was recorded, in combination with common stock issued above, as a debt discount of $ 251,361 at the time of issuance of the

In connection with the Private Placement

in May 2024, the Company issued common warrants (the “Common Warrants”) to purchase up to 2,758,620 shares of the Company’s

common stock ( 43,103 as adjusted for the September Stock Split).

The Common Warrants are exercisable immediately following the date of

issuance, have a term of five years from the effective date of the corresponding registration statement registering the shares

of Company common stock and the shares of Company common stock issuable upon exercise of the Common Warrants and have an exercise price

of $ 2.65 per share ($ 169.60 as adjusted for the September Stock Split).

A holder may not exercise any Common Warrants that would

cause the aggregate number of shares of common stock beneficially owned by the holder to exceed 4.99 % of the Company’s

outstanding common stock immediately after exercise.

The Common Warrants are subject to adjustment in the event of certain stock dividends

and distributions, stock splits, stock combinations, reclassifications or similar events affecting the common stock and also upon any

distributions for no consideration of assets to the Company’s stockholders.

In the event of certain corporate transactions, the

holders of the Common Warrants will be entitled to receive, upon exercise of the Common Warrants, the kind and amount of securities, cash

or other property that the holders would have received had they exercised the Common Warrants immediately prior to such transaction.

Common Warrants do not entitle the holders thereof to any voting rights or any of the other rights or privileges to which holders of common

stock are entitled.

In connection with the issuance of debt

to Firstfire in February 2025, the Company issued warrants (the “Firstfire Warrants”) to purchase up to 450,000 shares of the

Company’s common stock ( 7,031 as adjusted for the September Stock Split).

The Firstfire Warrants are exercisable immediately following

the date of issuance, have a term of five years and have an exercise price of $ 0.80 per share ($ 51.20 as adjusted for the September Stock

A holder may not exercise any of the Firstfire Warrants that would cause the aggregate number of shares of common stock beneficially

owned by the holder to exceed 4.99 % of the Company’s outstanding common stock immediately after exercise.

The Firstfire

Warrants are subject to adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications

or similar events affecting the common stock and also upon any distributions for no consideration of assets to the Company’s stockholders.

In the event of certain corporate transactions, the holders of the Firstfire Warrants will be entitled to receive, upon exercise, the

kind and amount of securities, cash or other property that the holders would have received had they exercised the Common Warrants immediately

prior to such transaction.

The Firstfire Warrants do not entitle the holders thereof to any voting rights or any of the other rights or

privileges to which holders of common stock are entitled.

In connection with the April Private

Placement pursuant to a securities purchase agreement (the “April Purchase Agreement”) with institutional investors (the “Purchasers”)

for the purchase and sale of approximately $ 8 million of shares of the Company’s common stock (the “Common Stock”) and

investor warrants at a price of $ 0.392 per Common Unit.

The entire transaction was priced at the market under Nasdaq rules.

consisted of the sale of Common Units (or Pre-Funded Units), each consisting of (i) one (1) share of Common Stock or one (1) Pre-Funded

Warrant, (ii) one (1) Series A PIPE Common Warrant to purchase one (1) share of Common Stock per warrant at an exercise price of $ 0.784

(the “Series A Warrant”) and (iii) one (1) Series B PIPE Common Warrant to purchase one (1) share of Common Stock per warrant

at an exercise price of $ 0.98 (the “Series B Warrant” and together with the Series A Warrant, the “Warrants”).

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Warrants (continued)

The initial exercise price of each Series

A Warrant is $ 0.784 per share of Common Stock.

The Series A Warrants are exercisable following stockholder approval and expire five (5)

years thereafter.

The number of securities issuable under the Series A Warrant is subject to adjustment as described in more detail in

the Series A Warrant.

The initial exercise price of each Series B Warrant is $ 0.98 per share of Common Stock or pursuant to an alternative

cashless exercise option.

The Series B Warrants are exercisable following stockholder approval and expire two and one-half ( 2.5 ) years

The number of securities issuable under the Series B Warrant is subject to adjustment as described in the Series B Warrant.

Each Pre-Funded Warrant is exercisable

for one share of Common Stock for $ 0.0001 immediately upon issuance until all of the Pre-Funded Warrants are exercised in full.

of Pre-Funded Warrant Shares are subject to adjustments for stock splits, recapitalizations, and reorganizations.

The shares of Common

Stock, shares underlying the Series A Warrants and shares underlying the Series B Warrants are collectively referred to as the “Securities”.

In connection with the Exchange Agreement the

Purchasers will exchange the Series A and Series B Warrants previously purchased in the April Private Placement for the Exchange Shares.

Warrant activity for the nine months

ended September 30, 2025 are summarized as follows:

Warrants Number of

Warrants Weighted

Price Weighted

(Years) Aggregate

Outstanding and exercisable - January 1, 2025 90,721 $ 76.16 4.82 —

Granted 286,783 —

Exercised ( 279,752 )

Outstanding and exercisable – September 30, 2025 97,752 $ 72.10 4.00 $ —

The fair value of warrants granted during

the nine months ended September 30, 2025 were valued using a Black-Scholes Value model, with the following assumptions

Risk-free interest rate

Contractual term

Dividend yield

Expected volatility

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Share-based Compensation

On October 26, 2016, the

Company’s Board of Directors approved the issuance of up to 25,000 shares of the Company’s common stock ( 1,250

shares as adjusted for the May Stock Split), in the form of restricted stock or options (“2016 Stock Plan”).

Effective January 30, 2017, the 2016 Stock Plan was amended and restated as the SG Blocks, Inc.

Stock Incentive Plan,

as further amended effective June 1, 2018 as further amended on July 30, 2020, as further amended on August 18, 2021 and as

further amended effective October 5, 2023 (as amended, the “Incentive Plan”).

The Incentive Plan authorizes the issuance

of up to 8,625,000 shares of common stock ( 431,250 shares as adjusted for the May Stock Split and 6,738 as further adjusted for the September Stock Split).

It authorizes the issuance of

equity-based awards in the form of stock options, stock appreciation rights, restricted shares, restricted share units, other

share-based awards and cash-based awards to non-employee directors and to officers, employees and consultants of the Company

and its subsidiary, except that incentive stock options may only be granted to the Company’s employees and its

subsidiary’s employees.

The Incentive Plan expires on October 26, 2026, and is administered by the Company’s

Compensation Committee of the Board of Directors.

Each of the Company’s employees, directors, and consultants are eligible to

participate in the Incentive Plan.

As of March 31, 2025, there were — shares of common stock available for

issuance under the Incentive Plan.

Stock-Based Compensation Expense

Stock-based compensation expense is included in the condensed

consolidated statements of operations as follows:

Nine Months Ended

September 30,

Payroll and related expenses

Stock-Based Option Awards

The Company has issued no stock-based

options during the nine months ended September 30, 2025 or 2024.

Because the Company does not have significant

historical data on employee exercise behavior, the Company uses the “Simplified Method” to calculate the expected life of

the stock-based option awards granted to employees.

The simplified method is calculated by averaging the vesting period and contractual

term of the options.

The following table summarizes stock-based

option activities and changes during the nine months ended September 30, 2025 as described below:

Shares Weighted

Per Share Weighted

Share Weighted

(in years) Aggregate

Outstanding – December 31, 2024 29 $ 496.00 $ 1,574.20 4.34 —

Outstanding – September 30, 2025 29 $ 31,744 $ 100,748.80 3.59 —

Exercisable – December 31, 2024 29 31,744 100,748.80 —

Exercisable – September 30, 2025 —

Restricted Stock Units

During the nine months ended September

30, 2025, a total of 1,250 of restricted stock units were granted to the board of directors the Company, under the Company’s stock-based

compensation plan at a fair value of $ 60.16 per share, which represents the closing price of the Company’s common stock at the grant

The restricted stock units granted vest over two years.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Share-based Compensation (continued)

As of September 30, 2025, there was $ 157,382 unrecognized

compensation costs related to non-vested restricted stock units.

The following table summarized restricted stock unit activities

during the three months ended September 30, 2025:

Non-vested balance at January 1, 2025

Forfeited/Expired

Non-vested balance at September 30, 2025

EARNINGS PER SHARE

Basic net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of common shares outstanding during the period.

Diluted net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of common and potentially dilutive common shares outstanding during the period.

Potentially dilutive common shares consist of the common shares issuable upon the exercise of stock options and warrants.

Potentially dilutive common shares are excluded from the calculation if their effect is antidilutive.

Because the Company had a net loss for the three months ended March 31, 2026, it is prohibited from including potential common shares in the computation of diluted per share amounts.

Accordingly, the Company has used the same number of shares outstanding to calculate both the basic and diluted loss per share.

The table below reflect the potentially dilutive securities excluded from the Company’s earnings per share calculation:

2026 March 31,

Common stock options 3 3

Restricted common stock units 714 738

Common stock warrants 9,736 9,781

Preferred stock 141,639 —

Convertible notes payable 12,982 —

Total potentially dilutive securities 165,074 10,522

STOCKHOLDERS’ EQUITY

Sale of Series C Preferred Stock

During the three months ended March 31, 2026, the Company sold 1,800 shares of its Series C Convertible Preferred Stock, with a stated value of $ 1,000 per share, for aggregate net proceeds of $ 1,547,800 .

Conversions of Series C Preferred Stock

During the three months ended March 31, 2026, holders of the Company’s Series C Convertible Preferred Stock converted 1,711 shares of Series C Preferred Stock into an aggregate of 122,990 shares of common stock in accordance with the terms of the certificate of designations.

Exchange of Series A Preferred Stock

In February 2026, the Company issued 58,500 shares of common stock in exchange for the surrender of 39,000 shares of Series A Preferred Stock held by its Chief Executive Officer, a related party.

The reacquisition of the preferred stock was accounted for as an equity transaction, and no gain or loss was recognized in the condensed consolidated statements of operations.

The excess of the fair value of the common shares issued over the carrying amount of the preferred stock surrendered, amounting to $ 395,967 , was recorded as a deemed dividend and is deducted from net loss in computing net loss attributable to common stockholders.

Settlement of Notes Payable and Due to Affiliates

As described in Note 6, during the three months ended March 31, 2026, the Company issued an aggregate of 147,281 shares of common stock in settlement of notes payable and amounts due to affiliates.

Stock-Based Compensation

During the three months ended March 31, 2026, the Company recognized stock-based compensation expense of $ 222,066 , consisting of $ 28,215 related to the vesting of restricted stock units and $ 193,851 related to the issuance of 18,462 shares of common stock for services.

During the three months ended March 31, 2026, 6,328 shares of common stock were issued in connection with the vesting of restricted stock units.

During the three months ended March 31, 2025, the Company recognized stock-based compensation expense of $ 106,298 .

COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is subject to certain claims

and lawsuits arising in the normal course of business.

The Company assesses liabilities and contingencies in connection with outstanding

legal proceedings utilizing the latest information available.

Where it is probable that the Company will incur a loss and the amount of

the loss can be reasonably estimated, the Company records a liability in our consolidated financial statements.

These legal accruals may

be increased or decreased to reflect any relevant developments on a quarterly basis.

Where a loss is not probable or the amount of the

loss is not estimable, the Company does not record an accrual, consistent with applicable accounting guidance.

Based on information currently

available, advice of counsel, and available insurance coverage, the Company believes that the established accruals are adequate and the

liabilities arising from the legal proceedings will not have a material adverse effect on the consolidated financial condition.

in light of the inherent uncertainty in legal proceedings, there can be no assurance that the ultimate resolution of a matter will not

exceed established accruals.

As a result, the outcome of a particular matter or a combination of matters may be material to the results

of operations for a particular period, depending upon the size of the loss or the income for that particular period.

The Company is subject to certain claims and lawsuits arising in the normal course of business.

The Company assesses liabilities and contingencies in connection with outstanding legal proceedings utilizing the latest information available.

Where it is probable that the Company will incur a loss and the amount of the loss can be reasonably estimated, the Company records a liability in its condensed consolidated financial statements.

These legal accruals may be increased or decreased to reflect any relevant developments on a quarterly basis.

Where a loss is not probable or the amount of the loss is not estimable, the Company does not record an accrual, consistent with applicable accounting guidance.

Based on information currently available, advice of counsel, and available insurance coverage, the Company believes that the established accruals are adequate and the liabilities arising from the legal proceedings will not have a material adverse effect on its consolidated financial condition, results of operations and cash flows.

However, that in light of the inherent uncertainty in legal proceedings there can be no assurance that the ultimate resolution of a matter will not exceed established accruals.

As a result, the outcome of a particular matter or a combination of matters may be material to the results of operations and cash flows for a particular period, depending upon the size of the loss or the income for that particular period.

Pizzarotti Litigation

- On or about August 10, 2018, Pizzarotti, LLC (“Pizzarotti”) filed a complaint against the Company and Mahesh Shetty,

the Company’s former President and CFO, and others, seeking unspecified damages for an alleged breach of contract by the Company

and another entity named Phipps & Co.

On or about August 10, 2018, Pizzarotti, LLC (“Pizzarotti”) filed a complaint against the Company and Mahesh Shetty, the Company’s former President and CFO, and others, seeking unspecified damages for an alleged breach of contract by the Company and another entity named Phipps & Co.

The lawsuit was filed as Pizzarotti, LLC.

Phipps & Co., et al.,

Phipps & Co., et al., Index No.

653996/2018 and commenced in the Supreme Court of the State of New York for the County of New York.

On or about April 1, 2019,

Phipps filed cross-claims against the Company and Mr.

Shetty asserting claims for indemnification, contribution, fraud, negligence, negligent

misrepresentation, and breach of contract.

The Company has likewise cross claimed against Phipps for indemnification and contribution,

claiming that any damages to the Plaintiff were the result of the acts or omissions of Phipps and its principals.

Pizzarotti’s suit arose from a

contract dated April 3, 2018 that it executed with Phipps whereby Pizzarotti, a construction manager, engaged Phipps to perform stone

procuring and tile work at a construction project located at 161 Maiden Lane, New York 10038.

Pizzarotti’s claims against the Company

arise from a purported assignment agreement dated August 10, 2018, whereby Pizzarotti claims that the Company agreed to assume certain

obligations of Phipps under a certain trade contract between Pizzarotti and Phipps.

Phipps’ claims against the Company arise from

a purported assignment agreement, dated as of May 30, 2018, among Pizzarotti, Phipps and the Company (the “Assignment Agreement”),

pursuant to which, it is alleged, that the Company agreed to provide a letter of credit in connection with the sub-contracted work to

be provided by Phipps to Pizzarotti.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies (continued)

The Company believes that the Assignment

Agreement was void for lack of consideration and moved to dismiss the case on those and other grounds.

On June 17, 2020, the New York

Supreme Court entered an order dismissing certain claims against the Company brought by cross claimant Phipps.

Specifically, the court

dismissed Phipps’ claims for indemnification, contribution, fraud, negligence and negligent misrepresentation.

The court did not

dismiss Phipps’ claim for breach of the Assignment Agreement.

The issue of the validity of the Assignment Agreement, and the Company’s

defenses to the claims brought by the plaintiff Pizzarotti and cross claimant Phipps, are being litigated.

The Company maintains

that the Assignment Agreement, to the extent valid and enforceable, was properly terminated and/or there are no damages, and, consequently,

that the claims brought against the Company are without merit.

On or about April 1, 2019, Phipps filed cross-claims against the Company and Mr.

Shetty asserting claims for indemnification, contribution, fraud, negligence, negligent misrepresentation, and breach of contract.

SG Blocks has likewise cross claimed against Phipps for indemnification and contribution, claiming that any damages to the Plaintiff were the result of the acts or omissions of Phipps and its principals.

Pizzarotti’s suit arose from a contract dated April 3, 2018 that it executed with Phipps whereby Pizzarotti, a construction manager, engaged Phipps to perform stone procuring and tile work at a construction project located at 161 Maiden Lane, New York 10038.

Pizzarotti’s claims against the Company arise from a purported assignment agreement dated August 10, 2018, whereby Pizzarotti claims that the Company agreed to assume certain obligations of Phipps under a certain trade contract between Pizzarotti and Phipps.

Phipps claims against the Company arise from a purported Assignment Agreement, dated as of May 30, 2018, between Pizzarotti, Phipps and the Company (the “Assignment Agreement”), pursuant to which, it is alleged, that the Company agreed to provide a letter of credit in connection with the sub-contracted work to be provided by Phipps to Pizzarotti.

The Company believes that the Assignment Agreement was void for lack of consideration and moved to dismiss the case on those and other grounds.

On June 17, 2020, the New York Supreme Court entered an order dismissing certain claims against the Company brought by cross claimant Phipps.

Specifically, the court dismissed Phipps claims for indemnification, contribution, fraud, negligence and negligent misrepresentation.

However, the court did not dismiss Phipps claim for breach of the Assignment Agreement.

The issue of the validity of the Assignment Agreement, and the Company’s defenses to the claims brought by the plaintiff Pizzarotti and cross claimant Phipps, are being litigated.

The Company maintains that the Assignment Agreement, to the extent valid and enforceable, was properly terminated and/or there are no damages, and, consequently, that the claims brought against the Company are without merit.

The Company intends to continue to vigorously defend the litigation.

parties have engaged in written discovery but no depositions have been conducted as of yet.

By motion dated February 24, 2021, Pizzarotti

moved to stay the entire action pending the outcome of a separate litigation captioned Pizzarotti, LLC v.

The parties have engaged in written discovery but no depositions have been conducted as of yet.

By motion dated February 24, 2021, Pizzarotti moved to stay the entire action pending the outcome of a separate litigation captioned Pizzarotti, LLC v.

FPG Maiden Lane, LLC et.

1 unchanged sentence

651697/2019, involving some of the same parties (but excluding the Company).

Phipps cross moved to consolidate the

Phipps cross moved to consolidate the two actions.

The Company opposed both motions.

On April 26, 2021, the court denied both motions and directed the parties to meet and confer

concerning the scheduling of depositions.

On May 10, 2021, the parties jointly filed with the court a proposed order providing the completion

of depositions of all parties and nonparties by September 30, 2021.

On April 4, 2024, the court entered an order setting forth the following

dates for the completion of the parties depositions:

(1) deposition of plaintiff shall occur by May 31, 2024, (2) deposition of Phipps

shall occur by June 30, 2024, (3) deposition of the Company shall occur by July 20, 2024, (4) deposition of Mr.

Shetty shall occur by

August 9, 2024, (5) deposition of FPG Maiden Lane, & J.

Landau shall occur by August 30, 2024, and (6) depositions of non-parties

shall occur by September 30, 2024.

As of September 30, 2025, the Company cannot estimate any potential loss.

2.) CPF GP 2019-1, LLC (“CPF

GP”) Litigation – In September 2023, a suit was filed in the form of a declaratory judgment to say CPF GP did not owe

certain monies to the Company.

On April 26, 2021, the court denied both motions and directed the parties to meet and confer concerning the scheduling of depositions.

On May 10, 2021, the parties jointly filed with the court a proposed order providing the completion of depositions of all parties and non-parties by September 30, 2021.

On April 4, 2024, the court entered an order setting forth the following dates for the completion of the parties depositions:

(1) deposition of plaintiff shall occur by May 31, 2024, (2) deposition of Phipps shall occur by June 30, 2024, (3) deposition of the Company shall occur by July 20, 2024, (4) deposition of Mr.

Shetty shall occur by August 9, 2024, (5) deposition of FPG Maiden Lane, & J.

Landau shall occur by August 30, 2024, and (6) depositions of non-parties shall occur by September 30, 2024.

Litigation is subject to many uncertainties, and the outcome of this action is not predicted with assurance.

The Company is currently unable to predict the outcome or possible recovery or loss or range of loss, if any, associated with the resolution of this litigation, and, accordingly, the Company has made no provision related to this matter in the accompanying condensed consolidated financial statements.

CPF GP 2019-1, LLC Litigation

In September 2023, a suit was filed in the form of a declaratory judgment to say CPF GP did not owe certain monies to the Company.

The Company filed counterclaims for the amounts owed.

The case settled in February 2024 in exchange for

mutual dismissals and monthly payments of the balance due, which is $ 745,000 in total to the Company from CPF GP.

3.) Farnam Litigation – In

October 2023, Farnam Street Financial, Inc.

(“Farnam”) filed suit against the Company in the United States District Court

for the District of Minnesota (Case No.

23-CV-3212) alleging breaches by the Company under a certain lease agreement between Farnam

and the Company dated as of October 13, 2022.

The case settled in February 2024 in exchange for mutual dismissals and monthly payments of the balance due, which is $ 745,000 in total to the Company from CPF GP.

To date, the Company has not received monthly payments and has not recorded this gain.

Farnam Litigation

In October 2023, Farnam Street Financial, Inc.

(“Farnam”) filed suit against the Company in the United States District Court for the District of Minnesota (Case No.

23-CV-3212) alleging breaches by the Company under a certain lease agreement between Farnam and the Company dated as of October 13, 2021.

Farnam sought monies owed under such lease agreement.

On August 1, 2024, the Company, SG

Echo and SG Environmental Solutions Corp.

(“SG Environmental”), a wholly owned subsidiary of the Company, entered into a settlement

agreement (the “Settlement”) with Farnam to resolve the pending litigation.

Simultaneously with the execution of the Settlement,

(i) the Company, SG Environmental and Farnam entered into an assignment and assumption agreement, pursuant to which SG Environmental was

substituted for the Company as the lessee under the lease agreement, and (ii) SG Environmental and Farnam executed a new Lease Schedule

On August 1, 2024, the Company, SG Echo and SG Environmental Solutions Corp.

(“SG Environmental”), a wholly owned subsidiary of the Company, entered into a settlement agreement (the “Settlement”) with Farnam to resolve the pending litigation.

Simultaneously with the execution of the Settlement, (i) the Company, SG Environmental and Farnam entered into an assignment and assumption agreement, pursuant to which SG Environmental was substituted for the Company as the lessee under the lease agreement, and (ii) SG Environmental and Farnam executed a new Lease Schedule No.

001R (Schedule 1R), which replaced the prior schedule in its entirety.

The terms of the Settlement included

the following:

(i) SG Environmental will be the signatory under the “Lessee” under the lease;

(ii) the initial term (the “Initial

Term”) of Schedule 1R is 18 months;

The terms of the Settlement included the following:

(i) SG Environmental will be the signatory as the Lessee under the lease;

(ii) the initial term (the Initial Term) of Schedule 1R is 18 months;

(iii) the Commencement Date of Schedule 1R is August 1, 2024;

(iv) the original cost of the equipment subject to Schedule 1R is $ 1,556,163.00 ;

(v) so long as there has been no default under the

lease and Schedule 1R, SG Environmental shall have the option to purchase the equipment at the end of the Initial Term for thirty-five percent

( 35 %) of the original cost of the equipment, or $ 544,657.05 , plus applicable taxes;

(vi) the “Monthly Lease Charge” under

Schedule 1R is $ 65,880.95 , plus applicable taxes;

and (vii) SG Environmental shall provide a new security deposit under Schedule 1R

in the amount of $ 167,056.00 , which shall be paid on or before August 1, 2024.

Simultaneously with the execution of the Settlement, the

Company and SG Echo executed a guaranty, whereby each of the Company and SG Echo jointly and severally guarantee SG Environmental’s

full and prompt payment and performance under the lease and Schedule 1R.

Per the Settlement, Farnam shall retain as income all prior

payments from the Company (or any Company affiliate) under the lease, the prior schedule, or any other agreement with the Company or its

affiliates, including all monthly lease charges, interim rent, taxes, interest, fees, late charges, and any security deposits, including

the deposit under the prior schedule.

Under the terms of the Settlement, Farnam and the Company each agree to waive and release any and

all claims against the other, except with respect to each party’s performance under the Settlement and each party’s future

obligations under the lease, Schedule 1R and guaranty agreements.

The case remains ongoing as disputes have arisen post-Settlement

between the Company and Farnam.

As of September 30, 2025, the Company cannot estimate any potential loss, besides the original amounts

of approximately $ 1.5 million which are included in accounts payable and accrued expenses.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies (continued)

(v) so long as there has been no default under the lease and Schedule 1R, SG Environmental shall have the option to purchase the equipment at the end of the Initial Term for thirty-five percent ( 35 %) of the original cost of the equipment, or $ 544,657.05 , plus applicable taxes;

(vi) the Monthly Lease Charge under Schedule 1R is $ 65,880.95 , plus applicable taxes;

and (vii) SG Environmental shall provide a new security deposit under Schedule 1R in the amount of $ 167,056.00 , which shall be paid on or before August 1, 2024.

Simultaneously with the execution of the Settlement, the Company and SG Echo executed a guaranty, whereby each of the Company and SG Echo jointly and severally guarantee SG Environmentals’ full and prompt payment and performance under the lease and Schedule 1R.

Per the Settlement, Farnam shall retain as income all prior payments from the Company (or any Company affiliate) under the lease, the prior schedule, or any other agreement with the Company or its affiliates, including all monthly lease charges, interim rent, taxes, interest, fees, late charges, and any security deposits, including the deposit under the prior schedule.

Under the terms of the Settlement, Farnam and the Company each agree to waive and release any and all claims against the other, except with respect to each party’s performance under the Settlement and each partys future obligations under the lease, Schedule 1R and guaranty agreements.

The case remains ongoing as disputes have arisen post-Settlement between the Company and Farnam.

As of March 31, 2026, the Company cannot estimate any potential loss, besides the original amounts of approximately $ 1.5 million which are included in accounts payable and accrued expenses on accompanying condensed consolidated balance sheets.

American Express Litigation

In December 2023, American Express Travel Related Services Company, Inc.

(“AMEX”) filed suit against the Company in the Supreme

Court of the State of New York, County of New York (Case No.

162231/2023) alleging breaches of a commercial credit card agreement between

AMEX and the Company, dated as of November 8, 2022.

AMEX sought monies owed under the commercial credit card agreement, with a balance

of $ 232,218.94 as of the commencement of the action.

In August 2024, AMEX filed a Motion for Default Judgment, which was granted

by the court on or about September 19, 2024, for the amount of damages requested in AMEX’s motion.

As of September 30, 2024 the

estimated potential loss to the Company is approximately $ 232,000 which is included in accounts payable and accrued expenses.

(AMEX) filed suit against the Company in the Supreme Court of the State of New York, County of New York (Case No.

162231/2023) alleging breaches of a commercial credit card agreement between AMEX and the Company, dated as of November 8, 2022.

AMEX sought monies owed under the commercial credit card agreement, with a balance of $ 232,218.94 as of the commencement of the action.

In August 2024, AMEX filed a Motion for Default Judgment, which was granted by the court on or about September 19, 2024, for the amount of damages requested in AMEXs motion.

As of March 31, 2026, the estimated potential loss to the Company is approximately $ 232,000 which is included in accounts payable and accrued expenses on accompanying condensed consolidated balance sheets.

Choctaw Litigation

In March 2024, the Choctaw Nation of Oklahoma (“Choctaw Nation”) filed suit against SG Echo, LLC (“SG Echo”) and

the Company in the District Court of Bryan County, State of Oklahoma (Case No.

In March 2024, the Choctaw Nation of Oklahoma (“Choctaw Nation”) filed suit against SG Echo and the Company in the District Court of Bryan County, State of Oklahoma (Case No.

CJ-2024-41) alleging:

(a) breaches by SG Echo under a certain

commercial lease agreement between SG Echo and the Choctaw Nation related to commercial property located at 2917 Big Lots Road, Durant,

Oklahoma 74701;

and (b) declaratory and injunctive relief relating to certain cranes, declaring the Choctaw Nation to be the owner of

the cranes and not SG Echo.

The Company disputes the Choctaw Nation’s allegations.

As of September 30, 2025, the case remains pending.

As of September 30, 2025, the estimated potential loss to the Company is approximately $ 138,000 which is included in accounts payable

and accrued expenses.

(a) breaches by SG Echo under a certain commercial lease agreement between SG Echo and the Choctaw Nation related to commercial property located at 2917 Big Lots Road, Durant, Oklahoma 74701;

and (b) declaratory and injunctive relief relating to certain cranes, declaring the Choctaw Nation to be the owner of the cranes and not SG Echo.

The Company disputes the Choctaw Nations allegations.

As of March 31, 2026, the case remains pending.

As of March 31, 2026, the estimated potential loss to the Company is approximately $ 138,000 which is included in accounts payable and accrued expenses on accompanying condensed consolidated balance sheets.

Durant Industrial Authority Litigation

In November 2024, The Durant Industrial Authority (“DIA”) filed suit against the Company, SG Echo, LLC, among others, alleging

breaches by the Company and SG Echo under a certain forgivable promissory note executed between SG Echo as the borrower and the DIA as

the lender in the principal sum of $ 750,000 (the “Forgivable Note”).

The indebtedness under the Forgivable Note would

be forgiven in three separate phases based upon the schedule set forth in the Forgivable Note.

The DIA’s allegations include, among

others, that due to SG Echo’s alleged breaches, the Forgivable Note is no longer forgivable and has been accelerated and is due

The Company and SG Echo dispute the DIA’s allegations.

As of September 30, 2025, the case remains pending.

As of September

30, 2025, the Company cannot estimate any additional potential loss, however as of September 30, 2025 the $ 750,000 is included in

short-term notes payable.

In November 2024, the filed suit against the Company, SG Echo, and among others, alleging breaches by the Company and SG Echo under a certain forgivable promissory note executed between SG Echo as the borrower and the Authority as the lender in the principal sum of $ 750,000 , the Forgivable Note.

The indebtedness under the Forgivable Note would be forgiven in three separate phases based upon the schedule set forth in the Forgivable Note.

The Authority’s allegations include, among others, that due to SG Echos’ alleged breaches, the Forgivable Note is no longer forgivable and has been accelerated and is due in full.

The Company and SG Echo dispute the Authority’s allegations.

As of March 31, 2026, the case remains pending.

As of March 31, 2026, the Company cannot estimate any additional potential loss, however as of March 31, 2026, the $ 750,000 is included in short-term notes payable on the accompanying condensed consolidated balance sheets.

Rulien Litigation

In March, 2024, Rulien Advisors, LLC (“Rulien”) filed suit against the Company in the Supreme Court of the State of New York

Commercial Division, Kings County (Case No.

506426/2024) alleging breaches of a consulting agreement entered into by the Company and Rulien,

dated as of December 17, 2018 (the “Consulting Agreement”), whereby the Company engaged Rulien to act as a non-exclusive independent

sales representative to promote the sale of, and to solicit orders for, products and services offered for sale by the Company.

alleges that it has earned commissions for (a) the alleged sale of property located at 1900 American Drive, Lago Vista, Texas, and (b)

the Company’s spin-off of the Company’s wholly-owned subsidiary, Safe and Green Development Corporation, into a separate publicly

traded company listed on the Nasdaq stock exchange.

The Company disputes Rulien’s claims.

The case remains pending.

As of September

30, 2025, the Company cannot estimate any potential loss.

In March 2024, Rulien Advisors, LLC (“Rulien”) filed a lawsuit against the Company in the Supreme Court of the State of New York, Commercial Division, Kings County (Case No.

506426/2024), alleging breaches of a consulting agreement dated December 17, 2018 (the “Consulting Agreement”), pursuant to which the Company engaged Rulien as a non-exclusive independent sales representative to promote the sale of, and solicit orders for, the Company’s products and services.

Rulien alleges that it is entitled to commissions totaling $ 1,373,750 in connection with (i) the alleged sale of property located at 1900 American Drive, Lago Vista, Texas, and (ii) the Company’s spin-off of its wholly owned subsidiary, Safe and Green Development Corporation, into a separately publicly traded company.

On June 24, 2026, the court entered a default judgment against the Company.

The Company has retained litigation counsel and will shortly file a motion to vacate the default judgment.

The Company disputes Rulien’s claims and intends to vigorously defend the matter.

At this time, the Company is unable to reasonably estimate the possible loss or range of loss, if any, associated with this matter.

Accordingly, no liability has been recorded in the accompanying condensed consolidated financial statements.

Caliber Litigation

In June 2024, Caliber Corporate Advisers, LLC (“Caliber”) filed suit against the Company in the Supreme Court of the State

of New York, County of New York (Case No.

652893/2024) alleging breaches of a Consulting Services Agreement between Caliber and the Company

(the “Services Agreement”), alleging a balance owed of $ 46,350 .

The Company disputes Calibers claims, and claims that Caliber

failed to provide meaningful services as set forth in the Services Agreement.

As of September 30, 2025, the case remains pending.

September 30, 2025, the Company cannot estimate any potential loss.

In June 2024, Caliber Corporate Advisers, LLC (“Caliber”) filed suit against the Company in the Supreme Court of the State of New York, County of New York (Case No.

652893/2024) alleging breaches of a Consulting Services Agreement between Caliber and the Company (the “Services Agreement”), alleging a balance owed of $ 46,350 .

The Company disputes Caliber’s claims, and claims that Caliber failed to provide meaningful services as set forth in the Services Agreement.

As of March 31, 2026, the case remains pending.

As of March 31, 2026, the Company cannot estimate any potential loss.

MDisrupt Litigation

In August 2024, MDisrupt, Inc.

(“MDisrupt”) filed suit against Safe and Green Medical Corporation (“SG Medco”)

and the Company in the 353 rd District Court of Travis County, Texas (Case No.

D-1-GN-24-003213) alleging breaches of a

consulting services agreement between Medco and MDisrupt entered into on or about September 20, 2023 (the “Services Agreement”),

alleging a balanced owed of $ 183,901 .

Medco and the Company dispute MDisrupt’s allegations.

Further, the Company was not party to

the Services Agreement.

As of September 30, 2025, the case remains pending.

As of September 30, 2025, the estimated potential loss to

the Company is $ 183,901 which is included in accounts payable and accrued expenses.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial

Statements (Unaudited)

Commitments and Contingencies (continued)

Vendor Litigation

(“MDisrupt”) filed suit against Safe and Green Medical Corporation (“SG Medco”) and the Company in the 353rd District Court of Travis County, Texas (Case No.

D-1-GN-24-003213) alleging breaches of a consulting services agreement between SG Medco and MDisrupt entered into on or about September 20, 2023 (the “MDisrupt Services Agreement”), alleging a balanced owed of $ 183,901 .

SG Medco and the Company dispute MDisrupt’s allegations.

Further, the Company was not party to the MDisrupt Services Agreement.

As of March 31, 2026, the case remains pending.

As of March 31, 2026, the estimated potential loss to the Company is $ 183,901 which is included in accounts payable and accrued expenses on accompanying condensed consolidated balance sheets.

Prakash Chakravarthi Arbitration

In April 2026, Prakash Chakravarthi (“Prakash”) filed a complaint and demand for arbitration against NAHD, Olenox, and the Company in Dallas, Texas alleging breaches of the Plan and Agreement of Reorganization (“PAR Agreement”), dated November 8, 2024, by and among NAHD and the shareholders of Machfu, alleging unpaid bank loans and a credit card of Machfu of approximately $ 513,000 , of which Prakash is the personal guarantor.

The Company disputes Prakash’s claims and claims that Prakash breached the applicable representations and warranties set forth in the Agreement.

As of March 31, 2026, the estimated potential loss to the Company is $ 513,000 , which is included in accounts payable and accrued expenses on accompanying condensed consolidated balance sheets.

Machfu Employees Litigation

In April 2026, Prakash Chakravarthi, Minakshisundaran Anand, Bharath Kishan, Ajinkya Wakhale, Karen Shariati, and Stanislav Bobovych (collectively, the “Machfu Employees”) filed suit against Machfu, NAHD, Olenox., and the Company in the United States District Court for the District of Maryland (Case No.

26-cv-01614-PX) alleging unpaid wages, retaliatory termination, among others.

The Company disputes the claims made by the Machfu Employees.

The Company believes that Machfu has suffered significant harm as a direct result of the actions of Machfu Employees, resulting in lost revenues.

The Company is preparing its answer and counterclaims.

The estimated potential loss to the Company is $ 107,783.57 , which is included in accounts payable and accrued expenses on the condensed consolidated balance sheets.

Sara Garcia Litigation

In March 2026, Sara Garcia (“Ms Garcia”) filed a Statement of Claim against Giant and the Company in the Ontario Superior Court of Justice (Court File No.

CV-26-00005478-000) alleging wrongful dismissal in the amount of $ 186,666.67 , breach of contract, accrued vacation pay, among others.

The Company disputes Ms Garcia’s claims and shortly will be filing its statement of defence.

The Company acquired Giant on or about December 18, 2025.

Ms Garcia was an employee of Giant at the time of the acquisition.

Garcia was terminated on February 3, 2026 due to Ms Garcia’s performance failures, failure to cooperate with superiors, failure to turn over access and control of Giant’s essential accounts to the Company, including Giant’s bank accounts, Giant’s internal software accounts, Giant’s external software accounts, Giant’s accounting software, among others.

As of March 31, 2026, the Company cannot estimate any potential loss.

SG Blocks, Inc.

v HOLA Community Partners, et.

On April 13, 2020, Plaintiff SG Blocks,

(the “Company”) filed a Complaint against HOLA Community Partners (“HCP”), Heart of Los Angeles Youth, Inc.

(“HOLA” and together with HCP, the “HOLA Defendants”), and the City of Los Angeles (“City”)

in the United States District Court for the Central District of California, Case No.

On April 13, 2020, Plaintiff, SG Blocks, filed a Complaint against HOLA Community Partners (“HCP”), Heart of Los Angeles Youth, Inc.

(“HOLA”) (HCP and HOLA are collectively referred to as the “HOLA Defendants”), and the City of Los Angeles (the “City”) in the United States District Court for the Central District of California, Case No.

2:20-cv-03432-ODW (“HOLA Action”).

Company asserted seven claims against HOLA Defendants arising out of and related to the Heart of Los Angeles construction project in Los

Angeles (the “HOLA Project”), to wit, for:

The Company asserted seven claims against the HOLA Defendants arising out of and related to the Heart of Los Angeles construction project in Los Angeles (the “HOLA Project”), to wit, for:

(1) breach of contract;

(2) conversion;

(3) default and judicial foreclosure under

the original agreement between the Company and HOLA (“Agreement”) as a security agreement;

(4) misappropriation of trade secrets

under California Civil Code section 3426;

(3) default and judicial foreclosure under the Agreement as a security agreement;

(4) misappropriation of trade secrets under California Civil Code section 3426;

(5) misappropriation of trade secrets under 18 U.S.C.

and (6) intentional interference

with contractual relations.

On April 20, 2020, HOLA filed a separate action against the Company in the Los Angeles Superior Court arising

out of the HOLA Project, asserting claims of (1) negligence;

and (6) intentional interference with contractual relations.

On April 20, 2020, HOLA filed a separate action against the Company in the Los Angeles Superior Court arising out of the HOLA Project, asserting claims of (1) negligence;

(2) strict products liability;

(3) strict products liability, (4) breach

(3) strict products liability, (4) breach of contract;

(5) breach of express warranty;

(6) violation of Business and Professions Code 7031(b);

and (7) violation of California’s

unfair competition law, Business and Professions Code section 17200 (“UCL”) (“HOLA State Court Action”).

State Court Action was removed to the Central District of California and consolidated with the HOLA Action.

On January 22, 2021, the Company filed

a Third-Party Complaint in the HOLA Action against Third-Party Defendants Teton Buildings, LLC, Avesi Construction, LLC, and American

Home Building and Masonry Corp (“AHB”) for indemnity and contribution with respect to HOLA’s claims.

The Company has

also notified its general liability carrier Sompo International regarding coverage concerning HOLA’s claims On February 25, 2021,

the Court entered an order dismissing the Company’s claims for (1) breach of contract;

and (7) violation of California’s unfair competition law, Business and Professions Code section 17200 (UCL) (the “HOLA State Court Action”).

The HOLA State Court Action was removed to the Central District of California and consolidated with the HOLA Action.

On January 22, 2021, the Company filed a Third-Party Complaint in the HOLA Action against Third-Party Defendants Teton Buildings, LLC, Avesi Construction, LLC (Avesi Construction), and American Home Building and Masonry Corp for indemnity and contribution with respect to HOLAs claims.

The Company has also notified its general liability carrier, Sompo International (“Sompo”), regarding coverage concerning HOLAs claims On February 25, 2021, the court entered an order dismissing the Company’s claims for (1) breach of contract;

(2) conversion;

(3) default and judicial

foreclosure under the Agreement as a security agreement;

(3) default and judicial foreclosure under the Agreement as a security agreement;

(4) misappropriation of trade secrets under California Civil Code section 3426;

(5) misappropriation of trade secrets under 18 U.S.C.

but denied dismissal of the Company’s claims for intentional

interference with contractual relations.

The Court also denied the Company’s motion to dismiss HOLA’s claims.

On March 12, 2021, the HOLA Defendants

filed an answer to the Company’s complaint against it denying liability and asserting affirmative defenses.

On March 12, 2021, the

Company filed an answer to the HOLA Defendants’ First Amended Consolidated Complaint against it, denying liability and asserting

affirmative defenses.

On April 26, 2021, the Company and the

HOLA Defendants filed a Joint Stipulation to Dismiss HOLA Community Partners’ Sixth Claim for Relief (violation of California Business

and Professions Code §7031(b)), with prejudice, pursuant to Fed.

but denied dismissal of the Company’s claims for intentional interference with contractual relations.

The Court also denied the Company’s motion to dismiss HOLAs claims.

On March 12, 2021, the HOLA Defendants filed an answer to the Company’s complaint against it denying liability and asserting affirmative defenses.

On March 12, 2021, the Company filed an answer to the HOLA Defendants First Amended Consolidated Complaint against it, denying liability and asserting affirmative defenses.

On April 26, 2021, the Company and the HOLA Defendants filed a Joint Stipulation to Dismiss HOLA Community Partners Sixth Claim for Relief (violation of California Business and Professions Code 7031(b)), with prejudice, pursuant to Fed.

41(a)(1)(A)(ii).

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies (continued)

On July 23, 2021, the Company filed

a First Amended Third-Party Complaint adding the following additional third party defendants seeking, inter alia , contractual indemnity,

equitable indemnity;

On July 23, 2021, the Company filed a First Amended Third-Party Complaint adding the following additional third-party defendants seeking, inter alia, contractual indemnity, equitable indemnity;

and contribution:

American Home Building and Masonry Corp.

(“American Home”), Anderson Air Conditioning,

(“Anderson”).

Broadway Glass and Mirror, Inc.

(American Home), Anderson Air Conditioning, L.P.

(Anderson), Broadway Glass and Mirror, Inc.

(Broadway), Marne Construction, Inc.

The McIntyre Company (“McIntyre”), Dowell & Bradley Construction, Inc.

dba J R Construction (“JR Construction”)

Junior Steel Co.

(Marne), The McIntyre Company (McIntyre), Dowell & Bradley Construction, Inc.

dba J R Construction (JR Construction), Junior Steel Co.

(Junior Steel), Saddleback Roofing, Inc.

(“Saddleback”) Schindler Elevator Corporation (“Schindler”)

(Saddleback), Schindler Elevator Corporation (Schindler), U.S.

Smoke & Fire Corp.

Smoke), and FirstForm, Inc.

(“FirstForm”) (collectively the “Additional

Third Party Defendants”).

On September 2, 2021, Schindler Elevator

filed its answer to the First Amended Third-Party Complaint.

On September 3, 2021, Junior Steel Co.

filed its answer to the First

Amended Third-Party Complaint.

On September 7, 2021, Anderson Air Conditioning, L.P.

filed its answer to the First Amended Third-Party

On October 6, 2021, the McIntyre Group filed its answer to the First Amended Third-Party Complaint.

On February 7, 2022, the Company filed

a request for entry of a Clerk’s default against the following defendants:

American Home Building and Masonry Corp., Avesi Construction,

Marne Construction, Inc., FirstForm, Inc., Dowell & Bradley Construction, Inc, Saddleback Roofing, Inc., and US Smoke and Fire Corp.

On February 9, 2022, the court entered a clerk’s default pursuant to Federal Rule 55 against the following defendants:

Home Building and Masonry Corp.

Avesi Construction, Dowel & Bradley Construction, Inc., Saddleback Roofing Inc.

and US smoke and Fire

(FirstForm) (collectively the” Additional Third Party Defendants”).

On September 2, 2021, Schindler filed its answer to the First Amended Third-Party Complaint.

On September 3, 2021, Junior Steel filed its answer to the First Amended Third-Party Complaint.

On September 7, 2021, Anderson filed its answer to the First Amended Third-Party Complaint.

On October 6, 2021, the McIntyre filed its answer to the First Amended Third-Party Complaint.

On February 7, 2022, the Company filed a request for entry of a clerks default against the following defendants:

American Home, Avesi Construction, Marne, FirstForm, JR Construction, Saddleback, and US Smoke.

On February 9, 2022, the court entered a clerks default pursuant to Federal Rule 55 against the following defendants:

American Home, Avesi Construction, JR Construction, Saddleback and U.S.

The parties that have answered and appeared in the case are currently engaged in discovery.

The dispute between SG Blocks, Inc.,

HOLA Community Partners, and others in the above-described lawsuit settled, and a formal settlement agreement was executed in December

The dispute between SG Blocks, HCP, and others in the above-described lawsuit settled, and a formal settlement agreement was executed in December 2022.

In accordance with the settlement agreement, all funds to be paid were, in fact, paid.

On February 27, 2023, the settling parties

filed a Joint Stipulation to Dismiss All Causes of Action Against All Parties Except Avesi Construction, LLC (“Aveshi”), and

Saddleback Roofing, Inc.

(“Saddleback”).

The claims against the settling parties, pursuant to the settlement, were to be dismissed

and have since been dismissed.

SG Blocks, Inc.

had taken defaults against Aveshi and Saddleback, and is continuing to pursue default judgments

against same.

On February 17, 2025, the Company executed

a Settlement Agreement and Release with Saddleback, to release all claims between the parties.

As part of the settlement, Saddleback agreed

to pay a settlement payment of $ 400,000 .

All of the settlement proceeds were refunded to the Company’s Insurer Sompo, based on monies

already paid out by Sompo in the underlying matter.

As the matter is now settled, the parties will shortly move the court to dismiss the

Saddleback matter.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies (continued)

On February 27, 2023, the settling parties filed a Joint Stipulation to Dismiss All Causes of Action Against All Parties Except Avesi Construction and Saddleback.

The claims against the settling parties, pursuant to the settlement, were to be dismissed and have since been dismissed.

SG Blocks had taken defaults against Avesi Construction and Saddleback, and is continuing to pursue default judgments against same.

On February 17, 2025, the Company executed a Settlement Agreement and Release with Saddleback, to release all claims between the parties.

As part of the settlement, Saddleback agreed to pay a settlement payment of $ 400,000 .

All of the settlement proceeds were refunded to the Company’s insurer Sompo, based on monies already paid out by Sompo in the underlying matter.

As the matter is now settled, the parties will shortly move the court to dismiss the Saddleback matter.

SG Blocks, Inc.

EDI International, PC

On June 21, 2019, SG Blocks, Inc.

a lawsuit against EDI International, PC (“EDI”), a New Jersey corporation, in connection with the parties’ consulting

agreement, dated June 29, 2016, pursuant to which EDI, was to provide, for a fee, certain architectural and design services for the original

project between the Company and HOLA (“Project”).

On June 21, 2019, SG Blocks filed a lawsuit against EDI International, PC (“EDI”), a New Jersey corporation, in connection with the parties consulting agreement dated June 29, 2016, pursuant to which EDI was to provide, for a fee, certain architectural and design services for the original project between the Company and the HOLA Project.

The lawsuit is styled SG Blocks, Inc.

EDI et al., and was filed

in California Superior Court, for the County of Los Angeles, case no.

SG Blocks, Inc.

claims that EDI, tortiously interfered

with SG Blocks, Inc’s economic relationship with HCP and HOLA.

EDI et al., and was filed in California Superior Court, for the County of Los Angeles, case no.

SG Blocks claims that EDI, tortiously interfered with SG Blocks economic relationship with HCP and HOLA.

The complaint seeks in excess of $ 1,275,754 in damages.

a cross-complaint for alleged unpaid fees and tortious interference with EDI contractual relationship with HCP and HOLA.

EDI cross-complaint

seeks in excess of $ 30,428.71 in damages.

On July 8, 2020, SG Blocks, Inc.

added PVE LLC as a defendant in the lawsuit, claiming PVE LLC

is liable to the same extent as EDI.

In May 2021, the parties settled EDI affirmative claims, and its cross-complaint was dismissed

with prejudice on August 23, 2021.

On SG Blocks, Inc.’s remaining claims, trial is set for October 2024.

On or about November

15, 2024, the Company received a jury verdict in its favor in the amount of $ 1.274 million against EDI styled as SG Blocks, Inc.

et al, case no.

EDI may appeal the verdict, thus there remains uncertainty whether the verdict will be reduced to a final

Should the Company secure a final judgment, there remains uncertainty whether the Company will be able to collect on the judgment.

On September 11, 2025 the Company executed

a settlement agreement (the “Settlement”) with EDI to resolve pending litigation between EDI and the Company (the “EDI

Litigation”).

Per the Settlement, EDI will pay the Company the sum of $ 2,000,000 which the Company has received as of September

30, 2025 and recorded to other income.

Under the terms of the Settlement, within

seven (7) business days after the Company receives payment in full accordance with the terms of the Settlement, the Company shall serve

and file an acknowledgement of satisfaction of judgment in full.

Additionally, within seven (7) business days after the parties receive

a fully executed copy of this Settlement, the parties shall execute and file a stipulated request for dismissal with prejudice of all

appeals, with each party bearing their own costs on appeal.

Under the terms of the Settlement, EDI

and the Company each agree to waive and release any and all claims against the other, except with respect to each party’s performance

under the Settlement.

The foregoing descriptions of the Settlement is qualified in its entirety by reference to the full text of the Settlement,

a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein in its entirety by reference.

3.) Teton Buildings, LLC

(i) On January 1, 2019, the Company

commenced an action against Teton Buildings, LLC (“Teton”) in Harris County, Texas (“Teton Texas Action”) to recover

approximately $ 2,100,000 arising from defendant’s breach of the operative contract related to the HOLA Project entered

into on or about June 2, 2017.

The Petition brought claims of breach of contract, negligence, and breach of express warranty.

February 2022, the Company dismissed without prejudice the Teton Texas Action.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies (continued)

(ii) On or about September 12, 2018,

the Company entered into a Firm Price Quote and Purchase (the “GVL Contract”) with Teton to govern the manufacture and provision

of 23 shipping containers and modular units (the “Teton GVL Modules”) for the Four Oaks Gather GVL project in South Carolina

(the “GVL Project”).

The Company maintains that Teton breached the GVL Contract by (i) failing to timely deliver the Teton

GVL Modules, (ii) delivering Teton GVL Modules that were defective in their design and manufacture, (iii) otherwise failed to meet South

Carolina Building Code regulations and (iv) breached applicable warranties.

As a result of the breach and defects in performance, design

and manufacture by Teton, Company asserts that it has sustained $ 761,401.66 in actual and consequential damages, excluding attorney’s

On October 16, 2019, Teton filed for Chapter 11 in the United States Bankruptcy Court for Southern District of Texas, Houston Division

styled In re:

Teton Buildings, LLC and bearing the case number 19-35811.

On February 11, 2020, the Company filed a proof of claim again

Teton in the amount of $ 2,861,401.66 arising from the HOLA Project and the GVL Contract.

On or about March 16, 2020, the Bankruptcy

Court converted Teton’s Chapter 11 reorganization case to a Chapter 7 liquidation case.

On July 18, 2019, Ronald Sommers, the Chapter

7 Trustee, filed a Report of No Distribution stating that there is no property available for distribution to creditors.

On August 20,

2019, the Bankruptcy Court closed the Teton bankruptcy case.

As such, there is no prospect of any recovery against Teton.

On January 22, 2021, the Company filed

a third-party complaint against Teton in the United States District Court for the Central District of California, Case No.

2:20−cv−03432

in the HOLA Action (described above), seeking to determine Teton’s liability in its capacity as a bankruptcy debtor in order to

collect any damages payable from Teton’s liability insurance carrier or carriers.

On July 23, 2021, the Company filed a First Amended

Third-Party Complaint against Teton and other named third party defendants (see #2 below).

Teton has been served with the First Amended

Third-Party Complaint and on or about February 11, 2022, Teton filed an answer and affirmative defenses.

On or about December 31, 2022, the parties

who appeared in the HOLA Action, including Teton by and through its insurance carrier, executed a Settlement Agreement and Release.

February 28, 2023 the court “so ordered” the parties’ stipulation dismissing all causes of action against the parties

to the Settlement Agreement and Release.

Other Litigation

1.) SG Blocks, Inc.

Osang Healthcare

Company, Ltd.,

On April 14, 2021, the Company commenced

an action against Osang Healthcare Company, Ltd.

(“Osang”) in the United States District Court, Eastern District

of New York, Case No.

21-01990 (“Osang Action”).

The Company has asserted that Osang materially breached a certain Managed

Supply Agreement (“MSA”) entered into between the parties on October 12, 2020, pursuant to which the Company received on consignment

two million ( 2,000,000 ) units of Osang’s “Genefinder Plus RealAmp Covid-19 PCR Test” (the “Covid-19 Test”)

for domestic and international distribution.

The Company has also asserted that Osang breached the covenant of good faith and fair dealing,

fraudulently induced it to enter into the MSA, and violated §349 of the New York General Business Law’s prohibition of deceptive

business practices.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies (continued)

On June 18, 2021, Osang served a motion

to dismiss the Osang Action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.

On July 30, 2021, the Company served its

opposition to the motion to dismiss.

On September 22, 2022, the court entered an order granting in part and denying in part Osang’s

motion to dismiss.

The court denied that part of Osang’s motion that sought dismissal of the Company’s causes of action for

breach of contract (but denied recovery of lost profits) and fraud, but dismissed the Company’s causes of action for breach of implied

covenant of good faith and fair dealing, indemnification, accounting, and violation of the New York Unlawful and Deceptive Trade Practices

Act (GBL §349).

A status conference was held on November

16, 2022 at which time the Court entered a scheduling order for the conducting of discovery.

Discovery is ongoing.

A settlement conference

was held by the Court on March 14, 2023, of which the Company was granted $ 450,000 .

2.) John Williams Shaw and Leo Patrick

On March 15, 2023, a complaint was filed

against John Williams Shaw and Leo Patrick Shaw (the “Defendants”) in the United States District Court of the Southern District

of New York seeking damaged to recover short swing profits from the Defendants pursuant to Section 16(b) of the Exchange Act.

26, 2023, the matter was settled and on October 3, 2023, a Stipulation and Order of Dismissal with Prejudice was filed and so-ordered

by the assigned judge.

The Company is currently unable to predict the outcome or possible recovery, if any, associated with the resolution

of this litigation, and, accordingly, the Company has made no provision related to this matter in the consolidated financial statements.

On May 1, 2023, the Company appointed

Patricia Kaelin as the Company’s Chief Financial Officer and entered into an employment agreement with Patricia Kaelin (the “Kaelin

Employment Agreement”) to employ Ms.

Kaelin in such capacity for an initial term of two (2) years, which provides for an annual

base salary of $ 250,000 , a discretionary bonus of up to 20 % of her base salary upon achievement of objectives as may be determined by

the Company’s board of directors and severance in the event of a termination without cause on or after September 30, 2023 in amount

equal to equal to one year’s annual base salary and benefits.

The Kaelin Employment Agreement also provides for the grant to Ms.

Kaelin of a restricted stock grant under the Company’s Stock Incentive Plan, as amended and as available for grant, of 60,000 shares

of the Company’s common stock, vesting quarterly on a pro-rata basis over the next eighteen (18) months of continuous service.

Kaelin is subject to a one-year post-termination non-compete and non-solicit of employees and clients.

She is also bound by confidentiality

During July 2023, Ms.

Kaelin’s annual base salary was adjusted to $ 300,000 , retroactive to May 1, 2023.

On January 3, 2025, the Board of Directors

(the “Board”) of the Company approved the appointment of Michael McLaren as the Company’s Chief Executive Officer and

on January 5, 2025, the Company entered into an employment agreement with Mr.

McLaren (the “Employment Agreement”) to employ

McLaren in such capacity for an initial term of two ( 2 ) years, which Employment Agreement provides for an annual base salary

of $ 250,000 which shall be increased to $ 400,000 upon the closing of a capital event which cures the Company’s stockholders’

equity deficiency with Nasdaq, a signing bonus of $ 50,000 payable within thirty ( 30 ) days of the Employment Agreement’s

effective date, a long-term incentive bonus with a range of between two (2) to four (4) times Mr.

then-base salary, subject to approval by the Company’s Board of Directors.

On January 16, 2025, the Company appointed

Jim Pendergast as the Company’s Chief Operating Officer and entered into an employment agreement with Mr.

Pendergast (the “Employment

Agreement”) to employ Mr.

Pendergast in such capacity for an initial term of two (2) years, which Employment Agreement

provides for an annual base salary of $ 200,000 , a restricted stock grant under the Company’s Stock Incentive Plan for 200,000 shares

of the Company’s common stock, vesting quarterly on a pro-rata basis over the next eighteen (18) months of continuous

service, and an annual performance bonus of up to 20 % of Mr.

Pendergast’s then-base salary, payable in cash and/or equity,

as determined by Company’s by the Company’s Board of Directors.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

EDI, filed a cross-complaint for alleged unpaid fees and tortious interference with EDI contractual relationship with HCP and HOLA.

EDI cross-complaint seeks in excess of $ 30,428.71 in damages.

On July 8, 2020, SG Blocks added PVE LLC as a defendant in the lawsuit, claiming PVE LLC is liable to the same extent as EDI.

In May 2021, the parties settled EDI affirmative claims, and its cross-complaint was dismissed with prejudice on August 23, 2021.

On SG Blocks remaining claims, trial was set for October 2024.

On or about November 15, 2024, the Company received a jury verdict in its favour in the amount of $ 1.274 million against EDI styled as SG Blocks, Inc.

v EDI et al, case no.

19STCV21725, which has been secured to a judgment.

The case is currently proceeding through post-judgment motions and filings.

There remains uncertainty whether the Company will be able to collect on the judgment.

Crescendo Communications Litigation

In December 2025, Crescendo Communications, LLC (“Crescendo”) filed suit against the Company in the Supreme Court of the State of New York, County of Nassau (Case No.

626903/2025) alleging breach of contract, dated as of March 8, 2023.

On April 9, 2026, the court entered a default judgment dated January 30, 2026, in the amount of $ 243,521.69 .

The Company has retained litigation counsel and will shortly file a motion to vacate the default judgment.

The Company disputes Crescendo’s claims and intends to vigorously defend the matter.

At this time, the Company is unable to reasonably estimate the potential loss or range of loss, if any, associated with this matter.

Accordingly, no liability has been recorded in the accompanying condensed consolidated financial statements.

RELATED PARTY TRANSACTIONS

As disclosed in Note 8, on December

14, 2023, the Company and Mr.

Galvin entered into the Galvin Note Payable.

As of September 30, 2025, the Company

has accrued approximately $ 450,000 for amounts due to Paul Galvin, the former CEO, for deferred salary due to him.

As disclosed in Note 8, in connection

with the acquisition of NAHD, the Company acquired Note J, L and M, which are due to related parties.

As of September 30, 2025, $ 3,14,727

is due to related parties, which are a result of the acquisition of NAHD.

Certain shareholders and related parties paid operating expenses

and outstanding bills on behalf of the Olenox, including vendor obligations and setup-related costs.

These payments were made to support

the Olenox’s early-stage operations and reflect the ongoing financial backing from key stakeholders.

The amounts advanced by related

parties are recorded as related party liabilities.

Deconsolidation

As disclosed in Note 2, during 2024

the Company recognized the effects of the Deconsolidation, Prior to the Deconsolidation, SG DevCorp was consolidated in the Company’s

financial statements.

Upon the Deconsolidation, the Company accounts for its investment in SG DevCorp on the equity method.

of the Deconsolidation resulted in a derecognition of $ 12,274,844 of assets, $ 9,022,017 of liabilities, and $ 1,657,829 in the carrying

value of the non-controlling interest in SG DevCorp.

Additionally, upon the Deconsolidation, the Company reduced its previously amount

recorded as due from SG DevCorp in the amount of $ 394,329 and recorded an amount of $ 1,717,694 due to SG DevCorp which was previously

eliminated in consolidation.

The Company recognized a gain of $ 4,728,348 which resulted from the difference between the fair value of

the Company’s investment upon deconsolidation of $ 8,126,350 , and the net assets and carrying value of the non-controlling interest

as described above.

The gain is included in income (loss) from discontinued operations.

The assets and liabilities of SG DevCorp at the

time of Deconsolidation amounted to the following:

Assets held for sale

Prepaid expenses and other current assets

Total current assets

Property, plant and equipment, net

Project development costs and other non-current assets

Intangible assets, net

Investment in and advances to equity affiliates

Total long-term assets

Accounts payable and accrued expenses

Contingent consideration payable

Short-term notes payable, net

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Discontinued Operations

The financial results of SG DevCorp

are presented as income (loss) from discontinued operations.

The following table represents the financial results of SG DevCorp:

The financial results of SG DevCorp

are presented as income (loss) from discontinued operations.

The following table represents the financial results of SG DevCorp:

September 30,

Operating Expenses:

Payroll and related expenses

General and administrative expenses

Marketing and business development expenses

Operating loss

( 1,529,394 )

Other income (expense)

$ ( 1,952,335 )

The total income from discontinued operations for the three

months ended March 31, 2024, is comprised of the following:

Gain from Deconsolidation

Net loss from discontinued operations

( 1,952,335 )

Business Combinations

On February 2, 2025, the Company

entered into the Merger Agreement with NAHD.

Following the Merger, NAHD and its operating subsidiaries will be indirect, wholly

owned subsidiaries of the Company.

As merger consideration, the Company will issue four million ( 4,000,000 ) shares of Series A

non-voting convertible preferred shares of the Company, par value $ 1.00 (the “Preferred Shares”), to NAHD’s

shareholders, with each Preferred Share having the right to convert into fifteen ( 15 ) shares of common stock of the Company,

provided, however, that any such conversion is subject to the approval by the Company’s common stockholders.

As a result of

the September Stock Split, each Preferred Share will have the right to convert into shares of common stock of the Company at a ratio

of 1 for 0.234375, meaning each 64 Preferred Shares will convert into 15 shares of common stock of the Company, meaning the

4,000,000 Preferred Shares will convert into 937,500 shares of common stock of the Company, subject to approval of a majority of the

Company’s common shareholders The Merger Agreement contains conditions to the completion of the Merger, including the filing

of the articles of incorporation and/or organization for the merger subsidiaries, and the adoption of board resolutions and/or sole

member resolutions by the merger subsidiaries approving the Merger.

On February 13, 2025, all of the closing conditions to the

Merger Agreement have been satisfied or waived, the Preferred Shares have been issued to NAHD’s shareholders, and the

transactions set forth in the Merger Agreement have been fully completed and closed.

The purchase consideration amounted

to $ 34,569,600 , which is the fair value of the Preferred Shares.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Business Combinations (continued)

The following table summarizes the preliminary

allocation of the purchase price to the assets acquired and liabilities assumed for the Merger:

Cash and cash equivalents

Accounts receivable

Oil and gas, on the basis of full cost accounting

Property, plant and equipment

Intangible assets

Project development cost and other assets

Accounts payable and accrued expenses

( 1,912,111 )

Due to related parties

( 3,476,828 )

Contract liabilities

Long-term debt

( 3,765,596 )

Total consideration

$ ( 34,569,600 )

As of September 30, 2025, the Company

has not completed its measurement period with respect to the acquisition.

The amounts above represent provisional amounts recorded at

this time and are subject to adjustments once the measurement period has ended.

On April 8, 2025 (the “Effective

Date”), the Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) with County Line Industrial

LLC (“County Line”) to acquire all of the assets and operating business of County Line (the “Assets”) for a purchase

price of $ 1,000,000 (the “Purchase Price”).

The acquisition of County Line’s business includes the acquisition of all

of County Line’s existing customers and business pipeline, and the hiring of County Line’s existing employees, and the hiring

of County Line’s sole member, Carter Fields.

Pursuant to the Asset Purchase Agreement,

the Company will pay the Purchase Price as follows:

a cash payment in the amount of $ 125,000 due on or before April 15, 2025, a cash payment

in the amount of $ 100,000 due on or before May 15, 2025;

a cash payment in the amount of $ 250,000 due on or before July 15, 2025;

a cash payment in the amount of $ 525,000 due on or before January 31, 2026.

The payments will bear no interest.

In addition to the Purchase

Price, the Company shall pay its current payable due to County Line, in the amount of $ 76,000 , on or before May 1, 2025.

County Line shall

pay all obligations of its three vehicles for an approximate total amount of $ 92,000 .

The Asset Purchase Agreement contains

customary representations and warranties for this type of transaction, including but not limited to, County Line shall deliver all of

the Assets free and clear of all liabilities, liens, loans, and encumbrances, and shall ensure that the Assets are in good working condition,

subject to normal wear and tear.

The Company shall not assume or be responsible for any of County Line’s liabilities, debts, obligations,

whether presently existing or arising thereafter.

County Line and its sole member have agreed to customary restrictive covenants including

non-competition, non-circumvention, and non-solicitation for a period of two years.

The following table summarizes the preliminary

allocation of the purchase price to the assets acquired and liabilities assumed in the Asset Purchase Agreement:

Property, plant and equipment

Total consideration

As of September 30, 2025, the Company

has not completed its measurement period with respect to the acquisition.

The amounts above represent provisional amounts recorded at

this time and are subject to adjustments once the measurement period has ended.

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

Business Combinations (continued)

On May 28, 2025, the Company entered

into an asset purchase agreement (the “Second Asset Purchase Agreement”) with Sherman Oil Company LLC and its affiliates (“Sherman

Oil”), pursuant to which the Company will acquire approximately 1,600 acres of held-by-production oil leases for oil wells located

in Wichita County and Wilbarger County, Texas (the “Second Assets”) for a purchase price of $ 1,000,000 (the “Second

Purchase Price”).

The purchase of the Second Assets includes Sherman Oil’s operational equipment of the oil wells.

Pursuant to the Second Asset Purchase

Agreement, the Company will pay the Second Purchase Price as follows:

$ 250,000 in cash on the closing date, $ 250,000 in cash within 90

days of the closing date, $ 250,000 in cash within 180 days of the closing date, and $ 250,000 in cash within 240 days of the closing date.

The payments will bear no interest.

The Second Asset Purchase Agreement

contains customary representations, warranties, and covenants.

The Second Asset Purchase Agreement also contain conditions to the completion

of the Merger including the filing of the articles of incorporation and/or organization for the merger subsidiaries, and the adoption

of board resolutions and/or sole member resolutions by the merger subsidiaries approving the Merger.

There are no assurances that the

parties will satisfy all of the conditions to the merger.

The following table summarizes the preliminary

allocation of the purchase price to the assets acquired and liabilities assumed in the Second Asset Purchase Agreement:

Oil and gas properties

Total consideration

As of September 30, 2025, the Company

has not completed its measurement period with respect to the acquisition.

The amounts above represent provisional amounts recorded at

this time and are subject to adjustments once the measurement period has ended.

The following unaudited pro forma consolidated

results of operations for the three months ended September 30, 2025 and 2024 assume the acquisitions of NAHD, County Line and Sherman

Oil were completed on January 1, 2024:

September 30,

Pro-forma total revenues

Pro-forma net loss

$ ( 4,549,362 )

$ ( 4,505,436 )

The following unaudited pro forma consolidated

results of operations for the nine months ended September 30, 2024 assume the acquisitions of NAHD, County Line and Sherman Oil were completed

on January 1, 2024:

September 30,

Pro-forma total revenues

Pro-forma net loss

$ ( 7,117,796 )

$ ( 8,764,180 )

SAFE & GREEN HOLDINGS CORP.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

As disclosed in Note 6, certain of the Company’s notes payable are held by related parties.

As disclosed in Notes 6 and 10, during the three months ended March 31, 2026, the Company issued 62,333 shares of common stock in settlement of $ 338,662 of amounts due to affiliates of the Company’s chief executive officer, and issued 58,500 shares of common stock in exchange for 39,000 shares of Series A Preferred Stock held by the Company’s chief executive officer.

As of March 31, 2026 and December 31, 2025, $ 1,242,772 and $ 1,498,205 , respectively, was due to the Company’s chief executive officer and affiliated entities.

These advances are non-interest bearing and are payable upon demand.

As of March 31, 2026 and December 31, 2025, accounts payable and accrued expenses include $ 358,670 of relocation costs due to the Company’s chief executive officer

SUBSEQUENT EVENTS

During October 2025, the Company issued 528,625 and 4,396,496 shares

of common stock from the conversion of notes payable and conversion of preferred stock, respectively.

Reverse Stock Split.

On May 8, 2026, the Company effected a 1-for-10 reverse stock split of its then-outstanding common stock.

All share and per share amounts set forth in these condensed consolidated financial statements have been recast to reflect the reverse stock split as if it had occurred as of the earliest period presented.

Series C Preferred Stock Conversions.

Subsequent to March 31, 2026, holders of the Company’s Series C Convertible Preferred Stock converted an additional 250 shares of Series C Preferred Stock into an aggregate of 44,694 shares of common stock.

Series E Preferred Stock Conversions.

Subsequent to March 31, 2026, holders of the Company’s Series E Convertible Preferred Stock converted shares of Series E Preferred Stock into an aggregate of 216,000 shares of common stock.

SG Echo Chapter 11 Filing.

On April 28, 2026, SG Echo LLC, a wholly owned subsidiary of the Company, filed a voluntary petition for relief under Chapter 11 of the U.S.

Bankruptcy Code in the United States Bankruptcy Court for the Eastern District of Oklahoma.

SG Echo continues to operate its business as a debtor-in-possession while pursuing a court-supervised reorganization.

The Chapter 11 proceeding is limited to SG Echo and does not include the Company or its other subsidiaries.

The Chapter 11 filing triggered an event of default under certain SG Echo debt agreements, including approximately $ 4.0 million owed to Enhanced Capital Oklahoma Rural Fund, LLC.

On May 26, 2026, the Company acquired 100 % of the membership interests of CS Digital Ventures, LLC.

The purchase consideration consisted of $ 30.0 million of upfront consideration, including $ 14.0 million in Series D Preferred Stock and a $ 16.0 million unsecured promissory note, warrants to purchase 1,500,000 shares of the Company’s common stock, and contingent consideration of up to $ 20.0 million in additional Series D Preferred Stock upon the achievement of specified revenue and Adjusted EBITDA milestones.

Psylinks Neurotech Corp Acquisition.

On July 3, 2026, the Company acquired 100 % of the outstanding shares of Psylinks Neurotech Corp.

in exchange for 104,166 restricted shares of the Company’s common stock, valued at approximately $ 500,000 .

The son of the Company’s Chief Executive Officer was a 50 % owner of Psylinks Neurotech Corp.

and therefore this transaction represents a related party transaction.

The Company is evaluating the accounting for the acquisition under ASC 805, Business Combinations, and the purchase price allocation is preliminary.

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

What changed 10-Q

Item 1. Financial Statements